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2013/07/03 - Agenda Packet
�• - i city of ANCHO ( , 10500 Civic Center Drive - Rancho Cucamonga, CA 91730-3801 City Office: (909) 477-2700 AGENDAS FIRE PROTECTION DISTRICT BOARD PUBLIC FINANCING AUTHORITY CITY COUNCIL REGULAR MEETINGS 1st and 3rd Wednesdays 4- 7:00 P.M. JULY 3, 2013 ORDER OF BUSINESS CLOSED SESSION Tapia Conference Room 5:00 P.M. Call to Order Public Communications Conduct of Closed Session City Manager Announcements REGULAR MEETINGS Council Chambers 7:00 P.M. MEMBERS MAYOR L. Dennis Michael MAYOR PRO TEM Sam Spagnolo COUNCIL MEMBERS William Alexander Marc Steinorth Diane Williams CITY MANAGER John R. Gillison twit; CITY ATTORNEY James L. Markman CITY CLERK Janice C. Reynolds Pii 1411 Clan cJC` /*IR INFORMATION FOR THE PUBLIC •._.• Cf'.,.:;t ii,,C.-6cAMONliA TO ADDRESS THE FIRE BOARD, AUTHORITY BOARD AND CITY COUNCIL The Fire Board, Authority Board and City Council encourage free expression of all points of view. To allow all persons to speak, given the length of the Agenda, please keep your remarks brief. If others have already expressed your position,you may simply indicate that you agree with a previous speaker. If appropriate,a spokesperson may present the views of your entire group. To encourage all views and promote courtesy to others, the audience should refrain from clapping, booing or shouts of approval or disagreement from the audience. The public may address the Fire Board.Authority Board or City Council by filling out a speaker card and submitting it to the City Clerk. The speaker cards are located on the wall at the back of the Chambers, at the front desk behind the staff table and at the City Clerk's desk. If as part of your presentation, you would like to display audio or visual material,please see the City Clerk before the meeting commences. Any handouts for the Fire Board, Authority Board or City Council should be given to the City Clerk for distribution. During"Public Communications,"your name will be called to speak on any item listed or not listed on the agenda in the order in which it was received. The "Public Communications" period will not exceed one hour prior to the commencement of the business portion of the agenda. During this one hour period, all those who wish to speak on a topic contained in the business portion of the agenda will be given priority, and no further speaker cards for these business items (with the exception of public hearing items)will be accepted once the business portion of the agenda commences. Any remaining "Public Communications" which have not concluded during this one hour period may resume after the regular business portion of the agenda has been completed. Comments are to be limited to five minutes per individual or less,as deemed necessary by the Chair, depending upon the number of individuals desiring to speak. If you are present to speak on an "Advertised Public Hearing" Item or on an "Administrative Hearing Item(s)," your name will be called when that item is being discussed, in the order in which it was received. Comments are to be limited to five minutes per individual or less, as deemed necessary by the Chair, depending upon the number of individuals desiring to speak. AGENDA BACK-UP MATERIALS - Staff reports and back-up materials for agenda items are available for review at the City Clerk's counter,the City's Public Library(-ies)and on the City's website. A complete copy of the agenda is also available at the desk located behind the staff table during the Council meeting. LIVE BROADCAST- Fire Board,Authority Board and City Council meetings are broadcast live on Channel 3 for those with cable television access. Meetings are rebroadcast on the second and fourth Wednesdays of each month at 11:00 a.m. and 7:00 p.m. The City has added the option for customers without cable access to view the meetings "on- demand"from their computers. The added feature of "Streaming Video On Demand"is available on the City's website at www.cityofrc.us/cityhafl/council/videos.asp for those with Hi-bandwidth (DSUCable Modem)or Low-bandwidth (Dial-up) Internet service. The Fire Board, Authority Board and City Council meet regularly on the first and third Wednesday of the month at 7:00 p.m. in the Council Chambers located at 10500 Civic Center Drive. Members of the City Council also sit as the Fire District Board and the Public Financing Authority Board. Copies of the agendas and minutes can be found @ www.cityofrc.us If you need special assistance or accommodations to participate in this meeting. please contact the City Clerk's office at (909) 477-2700. Notification of 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility. Listening devices are available for the hearing impaired. Please turn off all cellular phones and pagers while the meeting is in session. AMENDED AGENDA , 1 FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY AND CITY COUNCIL AGENDA JULY 3, 2013 To be Added to the Agenda: N. CITY MANAGER'S STAFF REPORT The following item has no legal publication or posting requirements. N4. Presentation of San Bernardino County Grand Jury Report for FY 2012/13 regarding the Animal Care and Adoption Center. (Oral Report) I, Debra L. McNay, Assistant City Clerk/Records Manager. of the City of Rancho Cucamonga, or my designee, hereby certify that a true, accurate copy of the foregoing amended agenda was posted on June 28, 2013, seventy-two (72) hours prior to the meeting per Government Code 54954.2 at 10500 Civic Center Drive. WU-RATIO*OF POSTING of arIEMDA Aat`c,,A bait‘G' Natty end declares as follows: I presently am,and at to times mentioned herein have been.the Rss,SsiC n k- Cr4 G' ( 4. of the City of Rancho Acting In that capacity,on 20 13 ,4/42)a rcrocx,I posted a true and correct copy of the ta VW-Meeting Agenda dated. 3 J 1 y 3� 20 /3 .at 10500 Civic Certer Drive,Rancho Cucamonga. I declare under penalty of perjury�the foregoing ta true and correct and that this declaration was executed on orif L .�- 2 B , 20 re. at Rancho Cucamonga. CITY CLERKS OFf10E AMENDED AGENDA : . . 1 J . FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY AND CITY COUNCIL AGENDA JULY 3, 2013 To be Added to the Agenda: N. CITY MANAGER'S STAFF REPORT The following item has no legal publication or posting requirements. N4. Presentation of San Bernardino County Grand Jury Report for FY 2012/13 regarding the Animal Care and Adoption Center. (Oral Report) I, Debra L. McNay, Assistant City Clerk/Records Manager, of the City of Rancho Cucamonga, or my designee, hereby certify that a true, accurate copy of the foregoing amended agenda was posted on June 28, 2013, seventy-two (72) hours prior to the meeting per Government Code 54954.2 at 10500 Civic Center Drive. AMENDED AGENDA FIRE PROTECTION DISTRICT, 1 • _•. PUBLIC FINANCING AUTHORITY AND CITY COUNCIL AGENDA JULY 3, 2013 ADDING TO THE AGENDA N4. A. 5:00 P.M. - CLOSED SESSION CALL TO ORDER - TAPIA CONFERENCE ROOM 1. Roll Call: Mayor Michael Mayor Pro Tern Spagnolo Council Members Alexander, Steinorth and Williams CLOSED SESSION CALLED TO ORDER AS THE FIRE PROTECTION DISTRICT AND CITY COUNCIL. B. ANNOUNCEMENT OF CLOSED SESSION ITEM(S) IC. PUBLIC COMMUNICATIONS ON CLOSED SESSION ITEM(S) CONDUCT OF CLOSED SESSION - TAPIA CONFERENCE ROOM I D1. CONFERENCE WITH LABOR NEGOTIATOR CHRIS PAXTON PER GOVERNMENT CODE SECTION 54954.2 REGARDING LABOR NEGOTIATIONS WITH SAN BERNARDINO PUBLIC EMPLOYEES ASSOCIATION. THE MID-MANAGER, SUPERVISORY/PROFESSIONAL GROUP, THE GENERAL LABOR GROUP, THE EXECUTIVE MANAGEMENT EMPLOYEES. THE RANCHO CUCAMONGA FIREFIGHTER ASSOCIATION LOCAL 227, THE FIRE SUPPORT GROUP AND THE FIRE MANAGEMENT GROUP— CITY, FIRE D2. CONFERENCE WITH PROPERTY NEGOTIATORS FOR THE CITY PER GOVERNMENT CODE SECTION 54956.8 FOR PROPERTY LOCATED AT NORTHWEST CORNER OF BASE LINE AND DAY CREEK BOULEVARD IN THE CITY OF RANCHO CUCAMONGA AND IDENTIFIED AS APN 1089-031-14, -15, -16, AND 1089-031-35: NEGOTIATING PARTIES: LINDA D. DANIELS, ASSISTANT CITY MANAGER, CITY OF RANCHO CUCAMONGA. AND RANDALL LEWIS, LEWIS GROUP OF COMPANIES REGARDING PRICE AND TERMS—CITY D3. CONFERENCE WITH PROPERTY NEGOTIATORS PER GOVERNMENT CODE SECTION 54956.8 FOR TWO PROPERTIES LOCATED ON THE EAST SIDE OF GROVE AVENUE, NORTH OF 8T" STREET AND MORE COMMONLY KNOWN AS 8837 GROVE AVENUE, AND THE SECOND PROPERTY IS SOUTH OF ARROW HIGHWAY. EAST OF ARCHIBALD AVENUE, AND MORE COMMONLY KNOWN AS 8590 MALVEN AVENUE: NEGOTIATING PARTIES: LINDA DANIELS, ASSISTANT CITY MANAGER AND RYAN COBB REPRESENTING NATIONAL CORE REGARDING PRICE AND TERMS — CITY E. CITY MANAGER ANNOUNCEMENTS FIRE PROTECTION DISTRICT, ••••• .- PUBLIC FINANCING AUTHORITY AND 2 • ace •_*„ CITY COUNCIL AGENDA JULY 3, 2013 lF. RECESS II CLOSED SESSION TO RECESS TO THE REGULAR FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY BOARD AND CITY COUNCIL MEETINGS AT 7:00 P.M. IN THE COUNCIL CHAMBERS AT CITY HALL, LOCATED AT 10500 CIVIC CENTER DRIVE, RANCHO CUCAMONGA, CALIFORNIA. G. REGULAR MEETING CALL TO ORDER - 7:00 P.M. COUNCIL CHAMBERS THE REGULAR MEETINGS OF THE FIRE PROTECTION DISTRICT, PUBLIC FINANCE AUTHORITY BOARD AND CITY COUNCIL WILL BE CALLED TO ORDER. IT IS THE INTENT TO CONCLUDE THE MEETINGS BY 10:00 P.M., UNLESS EXTENDED BY CONCURRENCE OF THE FIRE BOARD, AUTHORITY BOARD AND CITY COUNCIL. G1. Pledge of Allegiance G2. Roll Call: Mayor Michael Mayor Pro Tern Spagnolo Council Members Alexander, Steinorth and Williams H. ANNOUNCEMENTS/PRESENTATIONS 1 H1. 4'h of July Safety tips. I. PUBLIC COMMUNICATIONS I This is the time and place for the general public to address the Fire Protection District, Public Finance Authority Board and City Council on any item listed or not listed on the agenda. State law prohibits the Fire Protection District, Public Finance Authority Board and City Council from addressing any issue not previously included on the Agenda. The Fire Board, Public Finance Authority Board and City Council may receive testimony and set the matter for a subsequent meeting. Comments are to be limited to five minutes per individual or less, as deemed necessary by the Chair, depending upon the number of individuals desiring to speak. All communications are to be addressed directly to the Fire Board, Authority Board or City Council not to the members of the audience. This is a professional business meeting and courtesy and decorum are expected. Please refrain from any debate between audience and speaker, making loud noises, or engaging in any activity which might be disruptive to the decorum of the meeting. The public communications period will not exceed one hour prior to the commencement of the business portion of the agenda. During this one hour period, all those who wish to speak on a topic contained in the business portion of the agenda will be given priority, and no further speaker cards for these business items (with the exception of public hearing items) will be accepted once the business portion of the agenda commences. Any other public communications which have not concluded during this one hour period may resume after the regular business portion of the agenda has been completed. FIRE PROTECTION DISTRICT, •• PUBLIC FINANCING AUTHORITY AND 3 ;'r` CITY COUNCIL AGENDA JULY 3, 2013 CONSENT CALENDARS: The following Consent Calendar items are expected to be routine and non-controversial. They will be acted upon by the Fire Board/Authority Board/Council at one time without discussion. Any item may be removed by an Fire Board/Authority Board/Council Member for discussion. J. CONSENT CALENDAR - FIRE PROTECTION DISTRICT J1. Approval of Minutes: June 19, 2013 (Regular Meeting) -__ May 30, 2013 (Special Meeting) J2. Approval of Check Register dated June 12, 2013 through June 25, 2013 for the total 1 amount of$94,618.11. IL.IL CONSENT CALENDAR - PUBLIC FINANCING AUTHORITY K1. Approval of Minutes: June 19, 2013 (Regular Meeting) L. CONSENT CALENDAR - SUCCESSOR AGENCY L1. Accept the City Yard Expansion Project, Contract No. 11-068/RA11-009 as complete; 6 Release the Faithful Performance Bond; Accept a Maintenance Bond; Release the Labor and Materials Bond; Approve a Resolution Authorizing the Public Works Services Director to File a Notice of Completion; Release the Retention 35 Days after Acceptance and Approve the Final Contract Amount of$11,455,397.00 8 RESOLUTION NO. 13-096 A RESOLUTION OF THE CITY COUNCIL AND THE SUCCESSOR AGENCY OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ACCEPTING THE CITY YARD EXPANSION PROJECT, CONTRACT, NO. 11-068/RA11-009 AND AUTHORIZING THE FILING OF A NOTICE OF COMPLETION FOR THE WORK. M. CONSENT CALENDAR - CITY COUNCIL Ml. Approval of Minutes: June 19, 2013 (Regular Meeting) --- May 30, 2013 (Special Meeting) --- M2. Approval of Check Register dated June 12, 2013 through June 25, 2013 and payroll ending 10 June 25, 2013 for the total amount of$3,151,377.31. M3. Accept the City Yard Expansion Project, Contract No. 11-068/RA11-009 as complete; 44 release the Faithful Performance Bond; accept a Maintenance Bond; release the Labor and Materials Bond; approve a Resolution authorizing the Public Works Services Director to file a Notice of Completion; release the retention 35 Days after acceptance and approve the final contract amount of$11,455,397.00. FIRE PROTECTION DISTRICT, -••:a` PUBLIC FINANCING AUTHORITY AND 4 I.. .�• ;'• CITY COUNCIL AGENDA JULY 3, 2013 RESOLUTION NO. 13-096 46 A RESOLUTION OF THE CITY COUNCIL AND THE SUCCESSOR AGENCY OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ACCEPTING THE CITY YARD EXPANSION PROJECT, CONTRACT, NO. 11-068/RA11-009 AND AUTHORIZING THE FILING OF A NOTICE OF COMPLETION FOR THE WORK. M4. Authorization to award the purchase of one (1) Urban Forestry Aerial Chipper truck to Altec 48 Industries, Inc, of Dixon, California, in accordance with Request for Bid ("RFB") #13/14-001 (Replacing units #1517/10506) in the amount of $126,582.60 from Acct. No. 1 71 2001-5604 (Equipment and Vehicle Replacement). M5. Approval to accept and to allocate $1,000 grant awarded by Dollar General into Library 49 Revenue Account 1290000-4740/0-3736 and appropriate $1,000 into expenditure account 1290606-5200/0-3736 for Dollar General "Back 2 Basics Grant." M6. Approval to allocate $85,000 awarded by the California State Library into Library Revenue 50 Account 1291000-4740/0-3737 and appropriate $4,000 into expenditure account 1291602- 5010/0-3737, $1,000 into expenditure account 1291602-5030/0-3737, $25,000 into expenditure account 1291602-5200/0-3737, and $55,000 into expenditure account 1291602-5300/0-3737, for"Pop Up RC" project. M7 Release of Maintenance Guarantee Bond No. 71245393-M in the amount of $5,159.00 for 52 the Victoria Gardens Cultural Center LED Sign Project, Contract No. 12-017. M8. Consideration of approval of Resolutions ordering the preparation of the annual Engineer's 54 reports to initiate proceedings to levy annual assessments, preliminarily approve the annual Engineer's reports, declaring the City Council's Intention to levy annual assessments within Street Lighting Maintenance District Nos. 1 Through 8, inclusive, for Fiscal Year 2013/14 and setting the time and place for a public hearing thereon. No increase of assessment rate is proposed or permitted. RESOLUTION NO. 13-097 57 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORTS PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN STREET LIGHTING MAINTENANCE DISTRICT NOS. 1 THROUGH 8, INCLUSIVE, FOR FISCAL YEAR 2013/14 RESOLUTION NO. 13-098 59 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORTS FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN STREET LIGHTING MAINTENANCE DISTRICT NOS. 1 THROUGH 8, INCLUSIVE, FOR FISCAL YEAR 2012-13 FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY AND 5 •• CITY COUNCIL AGENDA JULY 3, 2013 RESOLUTION NO. 13-099 61 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2013/14 IN STREET LIGHTING MAINTENANCE DISTRICT NOS. 1 THROUGH 8. INCLUSIVE, AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON M9. Consideration of approval of Resolutions ordering the preparation of the annual Engineer's 210 reports to initiate proceedings to levy annual assessments, preliminarily approve the annual Engineer's reports, declaring the City Council's Intention to levy annual assessments within Landscape Maintenance District Nos. 1, 3A, 3B, 4-R, 5, 6-R. 7, 8, 9 and 10 for Fiscal Year 2013/14 and setting the time and place for a public hearing thereon. RESOLUTION NO. 13-100 213 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORTS PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN LANDSCAPE MAINTENANCE DISTRICT NOS. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8. 9, AND 10 FOR FISCAL YEAR 2013/14 215 RESOLUTION NO. 13-101 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORTS FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN LANDSCAPE MAINTENANCE DISTRICTS NOS. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9, AND 10 FOR FISCAL YEAR 2013/14 RESOLUTION NO. 13-102 217 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2012-13 IN LANDSCAPE MAINTENANCE DISTRICT NOS. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9. AND 10 AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON M10. Consideration of approval of Resolutions ordering the preparation of the annual Engineer's 447 reports to initiate proceedings to levy annual assessments. preliminarily approve the annual Engineer's reports, declaring the City Council's Intention to levy annual assessments within Park and Recreation Improvement District No. PD-85 for Fiscal Year 2013/14 and setting the time and place for a public hearing thereon. No increase of assessment rate for FY 2013/14 is proposed or permitted. FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY AND 6 - '= 'J CITY COUNCIL AGENDA JULY 3, 2013 RESOLUTION NO. 13-103 449 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORT PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 FOR FISCAL YEAR 2013-14 RESOLUTION NO. 13-104 451 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORT FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 FOR FISCAL YEAR 2013-14 RESOLUTION NO. 13-105 453 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2013-2014 PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON M11. Approval to accept a Rider to the substitute Improvement Security for remaining work to be 468 completed by Tract Map 18096, located at the southwest corner of East Avenue and Via Veneto Drive, submitted by Rancho Victoria Meadows, LLC. 471 RESOLUTION NO. 13-106 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING A RIDER TO THE EXISTING IMPROVEMENT SECURITY FOR TRACT MAP 18096 AND RELEASING THE CURRENT IMPROVEMENT SECURITY M12. Ordering the annexation to Landscape Maintenance District No. 3B and Street Lighting 472 Maintenance District Nos. 1 and 6 for DRC2012-00932, located at the southeast corner of Arrow Route and Grove Avenue, submitted by Bechara and Bernadette Mitri. RESOLUTION NO. 107 475 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA. ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO LANDSCAPE MAINTENANCE DISTRICT NO. 3B (COMMERCIAL INDUSTRIAL MAINTENANCE DISTRICT) FOR DRC2012-00932 RESOLUTION NO. 108 480 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 1 (ARTERIAL STREETS) FOR DRC2012-00932 .y' FIRE PROTECTION DISTRICT, � ': :•• ` PUBLIC FINANCING AUTHORITY AND 7 • '�•' CITY COUNCIL AGENDA JULY 3, 2013 RESOLUTION NO. 109 485 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 6 (COMMERCIAL/INDUSTRIAL) FOR DRC2012-00932 M13. Approval to receive and file Animal Center Statistics and Animal Center Outcome Report 490 for the month of May 2013. M14. Approval to accept a 2-year First 5 San Bernardino contract extension in the amount of 501 $651.367 and allocate Fiscal Year 2013-2014 funds in the amount of $319,264 into Healthy RC Revenue Account No. 1218000-4905 and appropriate $82,194 into Account No. 1218102-500, $15,850 into Account No. 1218102-5010, $39,995 into Account No. 1218102-5030, $103,725 into Account No. 1218102-5200, and $77,500 into Account No. 1218102-5300 for costs associated with the development and coordination of various Healthy RC programs and activities. N. CITY MANAGER'S STAFF REPORT The following item has no legal publication or posting requirements. Item N4. was added to the Agenda. N1. Approval of a Resolution authorizing the issuance of bonds for Community Facilities District No. 2003-01 Designated Improvement Area No. 1 Special Tax Refunding Bonds, Series 503 2013 in an aggregate principal amount not to exceed $15,000,000 (Fifteen million dollars) and the defeasance and refunding of prior special tax bonds. RESOLUTION NO. 13-110 505 A RESOLUTION OF THE CITY COUNCIL OF CITY OF RANCHO CUCAMONGA AUTHORIZING THE ISSUANCE OF BONDS OF COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $15.000.000. AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS OF SUCH DISTRICT ISSUED FOR IMPROVEMENT AREA NO. 1 THEREOF, APPROVING THE FORM OF A FISCAL AGENT AGREEMENT AND AUTHORIZING NEGOTIATION OF TERMS OF THE SALE OF SAID BONDS, APPROVING A PRELIMINARY OFFICIAL STATEMENT, AUTHORIZING PREPARATION OF A FINAL OFFICIAL STATEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS N2. Approval of a Resolution authorizing the issuance of bonds for Community Facilities District 710 No. 2003-01 Designated Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013 in an aggregate principal amount not to exceed $3,100,000 (Three million, one hundred thousand dollars) and the defeasance and refunding of prior special tax bonds. FIRE PROTECTION DISTRICT, PUBLIC FINANCING AUTHORITY AND 8 r• •-• CITY COUNCIL AGENDA JULY 3, 2013 RESOLUTION NO. 13-111 712 A RESOLUTION OF THE CITY COUNCIL OF CITY OF RANCHO CUCAMONGA AUTHORIZING THE ISSUANCE OF BONDS OF COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS. SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $3.100,000, AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS OF SUCH DISTRICT ISSUED FOR IMPROVEMENT AREA NO. 2 THEREOF, APPROVING THE FORM OF A FISCAL AGENT AGREEMENT AND AUTHORIZING NEGOTIATION OF TERMS OF THE SALE OF SAID BONDS, APPROVING A PRELIMINARY OFFICIAL STATEMENT, AUTHORIZING PREPARATION OF A FINAL OFFICIAL STATEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS N3. Adoption of a '`Permit Parking District" for the residential area identified as ''Almond Street" 902 generally located east of Sapphire Street. RESOLUTION NO. 13-112 908 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ESTABLISHING A PERMIT PARKING DISTRICT IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER 10.50 OF THE RANCHO CUCAMONGA MUNICIPAL CODE. N4. Presentation of San Bernardino County Grand Jury Report for FY 2012/13 regarding the 915 Animal Care and Adoption Center. (Oral Report) 0. COUNCIL BUSINESS I The following items have been requested by the City Council for discussion. Oral 01. INTER-AGENCY UPDATES (Update by the City Council to the community on the Report(s) meetings that were attended.) 02. COUNCIL ANNOUNCEMENTS (Comments to be limited to three minutes per Council Reports) Member.) P. IDENTIFICATION OF ITEMS FOR NEXT MEETING I Q. ADJOURNMENT I I, Debra L. McNay, Assistant City Clerk/Records Manager, of the City of Rancho Cucamonga, or my designee, hereby certify that a true, accurate copy of the foregoing agenda was posted on June 27, 2013, seventy-two (72) hours prior to the meeting per Government Code 54954.2 at 10500 Civic Center Drive. June 19, 2013 RANCHO CUCAMONGA CITY COUNCIL, FIRE PROTECTION DISTRICT, SUCCESSOR AGENCY CLOSED SESSION AND REGULAR MEETINGS MINUTES A. CALL TO ORDER The Rancho Cucamonga City Council and Fire Protection District held a closed session on Wednesday, June 19, 2013 in the Tapia Room at the Civic Center located at 10500 Civic Center Drive, Rancho Cucamonga, California. The meeting was called to order at 5:00 p.m. by Mayor L. Dennis Michael. Present were Council/Fire Protection District Members: Bill Alexander, Diane Williams, Marc Steinorth, Mayor Pro TemNice President Sam Spagnolo and Mayor/President L. Dennis Michael. Also present were: John Gillison, City Manager; City Attorney James Markman, Linda Daniels, Assistant City Manager; Lori Sassoon, Deputy City Manager/Administrative Services and Jeff Bloom. Deputy City Manager/Economic and Community Development. fB. ANNOUNCEMENT OF CLOSED SESSION ITEM(S) The following closed session items were considered: D1. CONFERENCE WITH LABOR NEGOTIATOR CHRIS PAXTON PER GOVERNMENT CODE SECTION 54954.2 REGARDING LABOR NEGOTIATIONS WITH SAN BERNARDINO PUBLIC EMPLOYEES ASSOCIATION, THE MID-MANAGER, SUPERVISORY/PROFESSIONAL GROUP, THE GENERAL LABOR GROUP, THE EXECUTIVE MANAGEMENT EMPLOYEES, THE RANCHO CUCAMONGA FIREFIGHTER ASSOCIATION LOCAL 227. THE FIRE SUPPORT GROUP AND THE FIRE MANAGEMENT GROUP— CITY. FIRE D2. CONFERENCE WITH LEGAL COUNSEL - ANTICIPATED LITIGATION PURSUANT GOVERNMENT CODE SECTION 54956.9(B) — NUMBER OF CASES (2) - CITY D3. CONFERENCE WITH PROPERTY NEGOTIATORS FOR THE CITY PER GOVERNMENT CODE SECTION 54956.8 FOR PROPERTY LOCATED AT 13349 BASELINE AVENUE, 13451 BASELINE AVENUE, AND 13479 BASELINE AVENUE IN THE CITY OF FONTANA AND IDENTIFIED AS APN 1100-771-02, -03, AND -09; NEGOTIATING PARTIES: KIRSTEN R. BOWMAN, ATTORNEY AT LAW, AND JASON WELDAY, TRAFFIC ENGINEER, CITY OF RANCHO CUCAMONGA; AND PROPERTY OWNERS, PACIFIC/COSTANZO/ LEWIS- FONTANA. A CALIFORNIA GENERAL PARTNERSHIP AND PACIFIC DEVELOPMENT GROUP AND THEIR DESIGNATED REPRESENTATIVES REGARDING REAL PROPERTY INTERESTS TO BE ACQUIRED AS PART OF THE INTERSTATE 15 AND BASE LINE ROAD INTERCHANGE PROJECT- CITY D4. CONFERENCE WITH PROPERTY NEGOTIATORS PER GOVERNMENT CODE SECTION 54956.8 FOR TWO PROPERTIES LOCATED ON THE EAST SIDE OF GROVE AVENUE, NORTH OF 8TH STREET AND MORE COMMONLY KNOWN AS 8837 GROVE AVENUE, AND THE SECOND PROPERTY IS SOUTH OF ARROW HIGHWAY, EAST OF ARCHIBALD AVENUE, AND MORE COMMONLY KNOWN AS 8590 MALVEN AVENUE: NEGOTIATING PARTIES: LINDA DANIELS, ASSISTANT CITY MANAGER AND RYAN COBB REPRESENTING NATIONAL CORE REGARDING PRICE AND TERMS. * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013 - Page 1 of 12 IC. PUBLIC COMMUNICATIONS ON CLOSED SESSION ITEM(S) No persons were present wishing to speak. E. CITY MANAGER ANNOUNCEMENTS No announcements were made. F. RECESS The closed session recessed at 6:00 p.m. with no action taken. G. REGULAR MEETING CALL TO ORDER - 7:00 P.M. COUNCIL CHAMBERS The meetings of the Rancho Cucamonga Fire Protection District, Successor Agency, Financing Authority and City Council reconvened in the Council Chambers of the Civic Center located at 10500 Civic Center Drive, Rancho Cucamonga, California. President/Chairman/Mayor L. Dennis Michael called the meeting to order at 7:00 p.m. Present were Board Members/Board Members/Council Members: Bill Alexander, Marc Steinorth, Diane Williams, Vice President/Vice Chairman/Mayor Pro Tem Sam Spagnolo and President/Chairman/Mayor L. Dennis Michael. Also present were: John Gillison, City Manager; James Markman, City Attorney; Linda Daniels, Assistant City Manager; Lori Sassoon, Assistant City Manager/Administrative Services; Jeff Bloom, Assistant City Manager/Economic & Community Development; Bill Wittkopf, Public Works Services Director; Mark Steuer, City Engineer; Candyce Burnett, Planning Manager; Nettie Neilson, Community Services Director; Robert Karatsu, Library Services Director; Veronica Fincher, Animal Care and Services Director; Fire Chief Mike Bell; Police Chief Mike Newcombe; Debra McNay, Assistant City Clerk/Records Manager and Adrian Garcia, Assistant City Clerk. H. ANNOUNCEMENTS/PRESENTATIONS H1. Animal Center Information. Veronica Fincher, Animal Care and Services Director and Robert Karatsu, Library Director presented an update regarding the Animal Care and Services Center. I. PUBLIC COMMUNICATIONS 11. Cynthia Stukey spoke about the amount of effort necessary to place a dog in a rescue. She noted that there are only a few legitimate rescues that were willing to take on older animals and pointed out that it takes cooperation from both staff and volunteers to make this happen. 12. Richard Collins expressed safety concerns for three areas in the City: People are parking and walking in the street in an area designated as No Parking at Los Osos High School; People are * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting—June 19, 2013 - Page 2 of 12 jaywalking and park and leave their car doors open on Haven Avenue north of Wilson; The right turn lane is not clearly marked at Haven Avenue going south onto Wilson. 13. Janet Walton offered a prayer for the City Council and the audience. 14. Tom Donahue spoke about the services provided by the Family Service Organization and indicated that they will be the new senior nutrition provider at the senior center. 15. Marla Tauscher stressed the importance of having a knowledgeable Director at the Animal Care and Services Center. She noted that it was illegal to euthanize animals surrendered by the owner yet 79 animals have been euthanized. Ms. Tauscher displayed the Euthanasia Log, noting that it was improperly kept. Lastly, she noted that it was not legal to keep animals in crates. 16. Vicky Reust addressed the alleged death threat that was posted on Facebook. She noted that the employees are blaming the group for breaking into cars, which is not the case. Ms. Reust stressed that animals are being euthanized unnecessarily and noted that this needs to stop. 17. Dana Keithly spoke about Leah, who was euthanized last year. She expressed a concern with the dog being kept in a quarantine kennel for several weeks and wondered how the Center could indicate that everything possible was done. Ms. Keithly noted that if the volunteers had been there, they would have saved her. 18. Allison Kreider indicated that kitten season starts in March/April and ends in October. She noted that the Center should be aware of this and plan for it. Kittens have been euthanized as the Center did not have enough foster care homes for them. Ms. Kreider wondered why the free help was fired, especially the Foster Care Volunteer of the Year for 2011. 19. Susan Keithly wondered on the inability to get beyond this matter. All the group wants is to help the animals. She requested that a meeting be organized. 110. Ondra Gilbertson noted that the same mistakes are being made over and over and indicated that there is not a dedicated program to display animals to the public. Ms. Gilbertson inquired if the new trailer in the back bay of the Center was properly approved and discussed. The money spent on this trailer should be spent to promote the No Kill philosophy at the Center. 111.Jerry Vincent provided information about the H. Martin Foundation and spoke about the creation of a H. Martin Global Community Center in the City. 112. Larry Henderson, representing the Alta Loma Riding Club, invited the Council and the audience to the St. Jude Benefit Ride on June 29, 2013. 113. Luana Hernandez spoke in support of Item L4 (Mills Act application). She invited the City Council and the audience to the Route 66 Car Show on June 29, 2013 at the Magic Lamp Inn. L14. Eugene Moy, Co-Chair of the China House Coalition, reported that the China House has been identified as one of the most 11 endangered places in the United States. He appreciated the Council's assistance and looked forward to working together to preserve this structure. L15. James McGuire expressed concerns with the comments that are being made regarding the Animal Care and Adoption Center. He noted that after all of this time, the Center has not yet reached the goal of finding homes for all the animals received. Mr. McGuire noted that the people who connected him with his dog, Tanya, have been removed from the shelter. L16. Les Davies pointed out that over 3 million dollars has been spent at this group's insistence and yet they are still not happy. She noted that enough money and time has been spent on this * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting—June 19, 2013- Page 3 of 12 situation. Ms. Davies indicated that the Director was interviewed, screened and is doing a very good job at the Center. L17. Diane Davis noted that these volunteers finally encountered a Director who can stand up to bullies. She wondered what organization in their right mind would reinstate them as they are hateful and violent. Ms. Davies noted that anyone wanted to assist an animal could adopt them or take them out for private medical treatment. L18. Terri Jacobs noted that these volunteers were not terminated for speaking out; they were terminated for creating a hostile working environment for everyone else. She noted that the Center was stagnant and no progress was being made. Ms. Jacobs indicated that Mr. Winograd concurs with the use of 501(c)3 facilities. L19. Suzanne Buquet noted that the City was very fortunate to find the current Animal Care and Adoption Center Director. She noted that the previous Director was very intimidated by these volunteers. Currently, the group is burying the Center in paperwork and wants to tell the Director how to do her job. L20. Royce Bordes, founder of the Angels and Paws Rescue, noted that she has a network of people who find dogs who are going to be put down and spoke about a transport group that she started. L21. David Dykstra noted the need to resolve this matter as there are good people on both sides. He agreed that more foster families are needed. L22. Nicole Myerchin asked that the appropriate policies and procedures be agendized and that these volunteers be allowed back in the Center. CONSENT CALENDARS: The following Consent Calendar items are expected to be routine and non-controversial. They will be acted upon by the Fire Board/Successor Agency/Authority Board/Council at one time without discussion. Any item may be removed by a Fire Board/Successor Agency/Authority Board/Council Member for discussion. J. CONSENT CALENDAR - FIRE PROTECTION DISTRICT J1. Approval of Minutes: June 5, 2013 (Regular and Special Meetings) June 6, 2013 (Special Meeting) June 13, 2013 (Special Meeting) J2. Approval of Check Register dated 5/29/13 through 6/11/13 for the total of $359,013.80. J3. Approval to receive and file current Investment Schedule as of May 31, 2013. J4. Approval to authorize an increase to Contract No. FD12-002 in the amount of $30,000 to WLC Architects, Inc. and approve Amendment No. 02 for the expansion of original architectural design services for the Fire District Capital Maintenance Projects performed at the Amethyst Fire Station, in accordance with the proposal dated March 8, 2013, funded from Account No. 3289501-5300. J5. Approval of a Resolution adopting Fiscal Year 2013/2014 Salary Schedules for Fire District Job Classifications. RESOLUTION NO. FD 13-031 * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting—June 19, 2013 - Page 4 of 12 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE RANCHO CUCAMONGA FIRE PROTECTION DISTRICT, RANCHO CUCAMONGA, CALIFORNIA, APPROVING THE SALARY SCHEDULES FOR FISCAL YEAR 2013/2014 MOTION: Moved by Spagnolo, seconded by Williams, to approve the staff recommendations in the staff reports. Motion carried 5-0. K. CONSENT CALENDAR - PUBLIC FINANCING AUTHORITY K1. Approval of Minutes: June 5, 2013 (Regular Meeting) MOTION: Moved by Alexander, seconded by Williams, to approve the minutes of the meeting. Motion carried 5-0. L. CONSENT CALENDAR - CITY COUNCIL L1. Approval of Minutes: June 5, 2013 (Regular and Special Meetings) June 6, 2013 (Special Meeting) June 13, 2013 (Special Meeting) L2. Approval of Check Register dated 5/29/13 through 6/11/13 and payroll ending 6/11/13 for the total of $5,866,432.34. L3. Approval to receive and file current Investment Schedule as of May 31, 2013. L4. Consideration of Mills Act Application DRC2013-00384 (CO 13-148) for Route 66 IECA to implement the use of the Mills Act to reduce property tax for the Cucamonga Service Station, a designated Historic Landmark, in the Specialty Commercial District within the Foothill Boulevard Overlay Zoning District located at 9670 Foothill Boulevard — APN: 0208- 153-05. RESOLUTION NO. 13-095 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING MILLS ACT AGREEMENT NO. DRC2013-00384 (ARTICLE 12, SECTION 50280 OF THE CALIFORNIA GOVERNMENT CODE) FOR THE HISTORIC LANDMARK PROPERTY, LOCATED AT 9670 FOOTHILL BOULEVARD, APN: 0208-153-05. L5. Approval to award the purchase of VMWare software support renewals (CO 13-127) to Insight Public Sector in the amount of $61,455, utilizing US Communities IT Products and Services contract 4400001195. L6. Approval to purchase Cisco Smartnet Maintenance (CO 13-128) through Nexus IS, Inc., utilizing competitively bid County of Riverside contract number RIVCO-20120-002-5/13 in an amount not to exceed $101,200. L7. Approval to Purchase Replacement Play Equipment from Landscape Structures, Inc., for the Golden Oak Park and the Mountain View Park Playgrounds, utilizing a competitively bid Cooperative Agreement awarded by Houston-Galveston Area Council (HGAC Contract No. PR 11-12), and authorize the expenditure of $42,588.39, plus $7,412.00, contingency to be funded from Account No. 1120401-5650/180120-0 (Park Development * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013- Page 5 of 12 - Golden Oak Park) and $149,552.04, plus $448.00, contingency to be funded from Account No. 1134303-5650/1833134-0 (LMD 4R - Mountain View Park). L8. Accept the bids received and award and authorize the execution of the contract (CO 13- 129) in the amount of $64,635.00, to the lowest responsive bidder, RSB Group Inc., and authorize the expenditure of a 10% contingency in the amount of $6,463.50, for the 24'h Street at Deer Creek Channel—Bridge Repair Project to be funded from Drainage Funds, Account No. 11123035650/1812112-0. L9. Accept the bids received and award and authorize the execution of the contract (CO 13- 130) in the amount of $218,479.80, to the lowest responsive bidder, DD Systems Inc. dba Ace CD Inc., and authorize the expenditure of a 10% contingency in the amount of $21,847.98, for the Deer Creek Channel Bike Trail improvements from Base Line Road to Highland Avenue to be funded from Safe Routes to School and Beautification Funds, Account Nos. 12343035650/1709234-0 and 1110316-5650/1709110-0. L10. Accept the bids received and award and authorize the execution of the contract (CO 13- 131) in the amount of $144,970.00, to the lowest responsive bidder, J.D.C. Inc., and authorize the expenditure of a 10% contingency in the amount of $14,497.00, for the Etiwanda Avenue sidewalks, curb and gutter, ramps, and flashing beacons, adjacent to Grapeland Elementary School and Etiwanda Intermediate School, to be funded from Safe Routes to School Grant, Gas Tax and Citywide Infrastructure Funds, Account Nos. 1234303-5650/1837234-0, 1174303-5650/1685174-0 and 1198303-5650/1837198-0. L11. Approval of Professional Services Agreements with Ninyo & Moore (CO 13-132), Salem Engineering Group, Inc. (CO 13-133), Leighton Consulting, Inc. (CO 13-134) and Converse Consultants (CO 13-135) to provide annual soils and materials testing services for FY 2013/2014, with an option to renew annually up to an additional two years, for proposed capital improvement projects throughout the City as approved in the budget. L12. Approval of Professional Services Agreements with CSD Land Surveying, Inc. (CO 13- 136), Dawson Surveying, Inc. (CO 13-137), L.E.H. & Associates (CO 13-138), Westland Group, Inc. (CO 13-139) and Madole & Associates (CO 13-140) to provide annual survey services for FY 2013/2014, with an option to renew annually up to an additional two years, for proposed capital improvement projects throughout the City as approved in the budget. L13. Approval of Professional Services Agreements with Aufbau Corporation (CO 13-141), Dan Guerra & Associates (CO 13-142) and Onward Engineering (CO 13-143) to provide annual public works inspection/construction support and engineering support services for FY 2013/2014, with an option to renew annually up to an additional two years, for proposed capital improvement projects throughout the City as approved in the budget and including a provision for development plan check. L14. Approval to renew Professional Services Agreement (CO#12-075) with International Line Builders, Inc. for Operation and Maintenance of the Arbors substation and the Municipal Utilities Electrical Distribution System within the Rancho Cucamonga Municipal Utility Services Area for FY 2013/14 to be funded from 17053035309 and 17053035603 Municipal Utility Fund. L15. Approval to renew Professional Services Agreement (CO#12-077) with Butsko Utility Design, Inc. for Technical Electrical Engineering Support within the Rancho Cucamonga * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013 - Page 6 of 12 Utility Services Area for FY 2013/14 to be funded from 17053035309 Municipal Utility Fund. L16. Approval to renew Professional Services Agreement (CO#12-078) with Applied Metering Technologies, Inc. for Installation, Configuration and Meter Reading Services within the Rancho Cucamonga Municipal Utility Services Area for FY 2013/14 to be funded from 17053035309 Municipal Utility Fund. L17. Accept Improvements, release the Faithful Performance Bond, and file a Notice of Completion for improvements for DRC2010-00348, located on the south east corner of Haven and Valencia Avenues, submitted by Ralph's Grocery Company. RESOLUTION NO. 13-084 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ACCEPTING THE PUBLIC IMPROVEMENTS FOR DRC2010-00348 AND AUTHORIZING THE FILING OF A NOTICE OF COMPLETION FOR THE WORK L18. Approval for an expenditure of $102,600.00 to Econolite Control Products, Inc., (CO 13- 144) for the purchasing of software and licenses for the Traffic Management Center Upgrade Project Citywide, to be funded from Transportation Fund, Account No. 11243035650/1831124-0. L19. Approval of Map, Improvement Agreement, Improvement Securities, Monumentation Cash Deposit and ordering the Annexation to Landscape Maintenance District No. 7 and Street Light Maintenance District Nos. 1 and 7 for Tract 18744, located on the north side of SR-210 Freeway west bound off ramp at Day Creek Boulevard and west side of Stable Falls Avenue, submitted by Lennar Homes of California, Inc. RESOLUTION NO. 13-085 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING THE FINAL MAP, IMPROVEMENT AGREEMENT, IMPROVEMENT SECURITIES AND MONUMENTATION CASH DEPOSIT FOR TRACT 18744 RESOLUTION NO. 13-086 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO LANDSCAPE MAINTENANCE DISTRICT NO. 7 (NORTH ETIWANDA) FOR TRACT 18744 RESOLUTION NO. 13-087 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 1 (ARTERIAL STREETS) FOR TRACT 18744 RESOLUTION NO. 13-088 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19. 2013 - Page 7 of 12 CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 7 (NORTH ETIWANDA) FOR TRACT 18744 L20. Approval of Map, Improvement Agreement, Improvement Securities, Monumentation Cash Deposit and ordering the Annexation to Landscape Maintenance District No. 4-R and Street Light Maintenance District Nos. 1 and 4 for Tract 18856, located on the south side of Church Street between Mayten Avenue and Malaga Drive, submitted by Homecoming V at Terra Vista, LLC. RESOLUTION NO. 13-089 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING THE FINAL MAP, IMPROVEMENT AGREEMENT, IMPROVEMENT SECURITIES AND MONUMENTATION CASH DEPOSIT FOR TRACT 18856 RESOLUTION NO. 13-090 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO LANDSCAPE MAINTENANCE DISTRICT NO. 4-R (TERRA VISTA PLANNED COMMUNITY) FOR TRACT 18856 RESOLUTION NO. 13-091 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 1 (ARTERIAL STREETS) FOR TRACT 18856 RESOLUTION NO. 13-092 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 4 (TERRA VISTA PLANNED COMMUNITY) FOR TRACT 18856 L21. Ratify Resolution No. 13-093 for the emergency acquisition of materials and contract labor forces necessary to effect the required roofing repairs to the Etiwanda Pacific Electric Depot in the amount of $102,654 and to appropriate $102,654 from Community Development Block Grant Funds Account Number 12043145650-1389. RESOLUTION NO. 13-093 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA RATIFYING AND AUTHORIZING THE EMERGENCY PROCUREMENT OF GOODS AND SERVICES WITHOUT COMPETITIVE BIDDING. * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013 - Page 8 of 12 L22. Accept the bids received for the Central Park Carpeting Project and award and authorize the execution of a contract (CO 13-145) for the base bid plus bid additives 2 through 5, in the amount of $91,101.17, to the lowest responsive bidder, G & S Carpet Mills, and authorize the expenditure of a contingency in the amount of $3,890.00, from Account No. 1025001-5602. L23. Accept the bids received for the Central Park Pavilion Project and award and authorize the execution of a contract (CO 13-146) for the base bid and bid additives 1 through 4, in the amount of $251,998.00, to the lowest responsive bidder, AToM Engineering, and authorize the expenditure of a 7% contingency in the amount of $17,640.00; $220,365.00 to be funded from Account No. 120401-5650/1834120-0, and $49,273.00 from Account No. 120401-5650/1803120-0 (Park Development). L24. Approval of a recommendation from the Park and Recreation Commission regarding proposed fee modifications for program activities and facilities operated by the Community Services Department. L25. Approval of a Resolution adopting Fiscal Year 2013/2014 salary schedules for City job classifications. RESOLUTION NO. 13-094 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING THE SALARY SCHEDULES FOR FISCAL YEAR 2013/2014, INCLUDING CITY COUNCIL BENEFITS L26. Approval of License Agreement renewal (CO 13-147) with San Bernardino County for roof space at the County Courthouse for Public Safety Video Network communications equipment. L27. Approval of Police Department's application of funding from the 2013/14 Edward Byne Memorial Justice Application Grant using the County of San Bernardino Law and Justice Group as the grant administrator for the Public Safety Video Camera Project. MOTION: Moved by Williams, seconded by Spagnolo. to adopt the recommendations in the staff reports. Motion carried 5-0. M. CONSENT ORDINANCES The following Ordinances have been introduced for first reading. Second readings are expected to be routine and non-controversial. The Fire Board, or Council will act upon them at one time without discussion. The City Clerk will read the title. Any item can be removed for discussion by a Board Member, or Council Member. M1. DEVELOPMENT CODE AMENDMENT DRC2013-00101 AND ADDENDUM TO GENERAL PLAN FINAL PROGRAM ENVIRONMENTAL IMPACT REPORT (FPEIR) (SCH #2000061027) - CITY OF RANCHO CUCAMONGA - A supplement to Development Code Update (DRC2010-00571) amending Title 17 (Development Code) of the Rancho Cucamonga Municipal Code to clarify definitions and administrative procedures, correct prior errors and omissions, and regulate cottage food operations and ancillary equipment in industrial zones. An addendum to the General Plan FPEIR has been prepared for this project. * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013 - Page 9 of 12 ORDINANCE NO. 860 (SECOND READING) AN ORDINANCE OF THE CITY COUNCIL OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING DEVELOPMENT CODE AMENDMENT DRC2013-00101, A SUPPLEMENTAL UPDATE TO THE DEVELOPMENT CODE, AND MAKING FINDINGS IN SUPPORT THEREOF. The Assistant City Clerk/Records Manager read the title of Ordinance No. 860. MOTION: Moved by Spagnolo, seconded by Williams, to adopt Ordinance No. 860 for second reading. Motion carried 5-0. N. ADVERTISED PUBLIC HEARINGS FIRE PROTECTION DISTRICT The following items have been advertised and/or posted as public hearings as required by law. The Chair will open the meeting to receive public testimony. N1. Adoption of Development Services Fees and Disposition of Inspection and Permit Fees. RESOLUTION NO. FD 13-032 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE RANCHO CUCAMONGA FIRE PROTECTION DISTRICT, RANCHO CUCAMONGA, CALIFORNIA, ESTABLISHING FEES AND CHARGES FOR VARIOUS FIRE DISTRICT DEVELOPMENT SERVICES, INCLUDING PLAN CHECK, INSPECTION AND PERMIT FEES; ESTABLISHING PROCEDURES FOR ANNUAL WAIVER OF SPECIFIC FEES; AND WAIVER OF SPECIFIC FEES FOR FISCAL YEAR 2013-14 Rob Ball, Fire Marshall, presented the staff report. President Michael opened the public hearing. With no one wishing to speak, President Michael closed the public hearing. MOTION: Moved by Steinorth, seconded by Alexander, to adopt Resolution No. FD 13-032. Motion carried 5-0. 0. CITY MANAGER'S STAFF REPORT I The following item has no legal publication or posting requirements. 01. Development Code/Specific Change analysis and recommendations for the Foothill Boulevard Bus Rapid Transit Study DRC201 2-0061 0—Compass Blueprint Project. May Nakajima, Assistant Planner and members of the Terra Nova consultant team presented the staff report. Mayor Michael inquired if other cities are participating in this process. In response, it was noted that while only Rancho Cucamonga is doing an independent analysis, all the cities are discussing * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting—June 19, 2013 - Page 10 of 12 it. Council Member Alexander indicated that the study was very difficult to read and noted that he had many questions. For instance, the concept for housing above retail had generated many questions on the type of restrictions that would cause. Mayor Pro Tern Spagnolo was concerned on how this concept would work for the entire City. For instance, Foothill was designed to efficiently move traffic. To work effectively, many people will need to change their personal habits. Also, Mayor Pro Tern Spagnolo noted that many areas are currently developed. He appreciated the work and the concepts raised in the report. Council Member Steinorth noted that many assumptions are made in the report. He was surprised that traffic is not projected to be more of an increase. While the Council Member was not convinced that the market was there now, he recognized that with the anticipated population growth and the projected traffic, something will need to be done. Council Member Steinorth appreciated the work but noted that many questions remain. Council Member Williams was pleased with the suggestion that the Metrolink Station be moved. She recently visited Seattle and appreciated the transit system in that City. The Council Member stressed the need to plan for the future. She noted that there is only a limited amount of open space left and stressed the need to keep these concepts in mind when development occurs. Mayor Michael liked the live/work concept and the idea of boarding a bus on Haven Avenue and travelling down to Victoria Gardens. He stressed the need to move forward and look at the opportunities to implement these concepts when they are presented. Mayor Michael thanked staff and the Terra Nova consultants for their report. P. COUNCIL BUSINESS The following items have been requested by the City Council for discussion. P1. CONSIDERATION OF CITY COUNCIL COMMUNITY SERVICES SUBCOMMITTEE'S RECOMMENDATION REGARDING APPOINTMENTS TO THE COMMUNITY & ARTS FOUNDATION BOARD OF DIRECTORS. Mayor Pro Tem Spagnolo reported that the Community Service Subcommittee is recommending the reappointment of Jim Harrington and the appointment of Rod LeMond. MOTION: Moved by Williams, seconded by Alexander, to reappoint Jim Harrington and appoint Rod LeMond to the Community Foundation Board of Directors, each for a four year term, to expire in June, 2017. Motion carried 5-0. P2. INTER-AGENCY UPDATES (Update by the City Council to the community on the meetings that were attended.) No updates were presented. P3. COUNCIL ANNOUNCEMENTS (Comments to be limited to three minutes per Council Member.) No announcements were made. Q. IDENTIFICATION OF ITEMS FOR NEXT MEETING * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting —June 19, 2013 - Page 11 of 12 No items were identified. R. ADJOURNMENT Mayor Michael adjourned the meeting at 9:18 p.m. Respectfully submitted, Debra L. McNay, MMC Assistant City Clerk/Records Manager Approved: * * * * * * DRAFT * Fire Protection District, Financing Authority, City Council Minutes Regular Meeting—June 19, 2013- Page 12 of 12 May 30, 2013 CITY OF RANCHO CUCAMONGA CITY COUNCIL MINUTES FIRE PROTECTION DISTRICT MINUTES SPECIAL MEETING i A. CALL TO ORDER A special meeting of the Rancho Cucamonga City Council and Fire Protection District was held on Thursday, May 30, 2013, in the Tri-Communities Room at the Civic Center located at 10500 Civic Center Drive, Rancho Cucamonga, California. Mayor/President L. Dennis Michael called the meeting to order at 5:00 p.m. Present were Council Members/Board Members: Bill Alexander, Marc Steinorth, Diane Williams, Mayor Pro TemNice President Sam Spagnolo and Mayor/President L. Dennis Michael. Also present were: John Gillison, City Manager; Linda Daniels, Assistant City Manager; Lori Sassoon, Deputy City Manager/Administrative Services; Tamara Layne, Finance Director; Chris Paxton, Human Resources Director; Jeff Bloom, Deputy City Manager/Economic and Community Development; Candyce Burnett, Planning Manager; Mark Steuer, Director of Engineering Services; Bill Wittkopf, Public Works Services Director; Robert Karatsu, Library Director; Nettie Nielson, Community Services Director; Trang Huynh, Building and Safety Services Director; Chief Mike Bell, Rancho Cucamonga Fire Protection District; Veronica Fincher, Animal Services Director, Police Chief Mike Newcombe and Debra L. McNay, Assistant City Clerk/Records Manager. . . . « . . I B. PUBLIC COMMUNICATIONS I No communication was made from the public. I C. ITEMS OF DISCUSSION Cl. DISCUSSION AND CONSIDERATION OF PROPOSED BUDGETS FOR FISCAL YEAR 2013/14 John Gillison, City Manager made a PowerPoint presentation on the proposed budgets for Fiscal Year 2013/14. He indicated that Fiscal Year 2013/14 marks the first budget since Fiscal Year 2009/10 that will actually experience mostly overall positive growth. While the revenue growth remains modest, costs are on the rise again also. The economic outlook, although cautious, is at least headed in a positive direction. Mr. Gillison indicated that there are still challenges at the Federal level with the debt ceiling, the budget deficit and Federal tax reform. Also, he noted that State finances are far from certain and continued encroachment into local revenue remains a distinct possibility. Local issues include pension costs, financial challenges in some landscaping and street lighting districts and the need to rebuild reserves. Mr. Gillison noted that the City is starting to restore services that were cut in prior years. Also, there is a continuation of the restructuring and reorganization of City staff. The City's revenues, which are largely based on sales taxes, will rise as unemployment drops and job growth picks up. * DRAFT * Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 1 of 4 In response to Council Member Alexander, Mr. Gillison noted that it is too soon to know what the impact to sales tax revenues will be as a result of sales tax being collected from Internet sales. Mr. Gillison discussed in more detail the principal challenges for Fiscal Year 2013/14. These include finishing the adjustment to the permanent loss of RDA funding and the programs, projects, services, and personnel that were supported with those funds. There is a need to begin the negotiations on new MOU's for all employee groups to manage the continuing increase in PERS rates, which will place emphasis on employee cost sharing. Also, there is a need to continue to address the fiscal challenges in key special districts, such as PD 85 and LMD 1. The goal to offset rising utility and fuel costs with increased efficiencies, cost savings in other areas, technology improvements, or new revenues was identified. Also, the goals to balance the City's operating budget without using reserves; the desire to eliminate various temporary budget stabilization practices and to rebuild reserves was discussed. Mr. Gillison also highlighted the need to initiate construction on the Base Line / 1-15 interchange project as well as the creation of a new Economic Development Plan and strategy for the City considering the loss of redevelopment and the changing nature of the marketplace. Fiscal Year 2013/14 budget highlights were identified. Mr. Gillison spoke about the proposed Increased expenditure, from General Fund monies, for infrastructure replacement and funding of missing sidewalk segments and street repaving and/or replacement projects in the Capital Improvement Program. Also funding is proposed to address necessary reclassifications, position upgrades and/or consolidations, etc. Lastly, Mr. Gillison discussed the impact of the Affordable Care Act on part-time staff. Council Member Alexander noted the reference to private contracts. He noted that the City should consider if hiring additional employees would be more cost effective. In response to the funding for personnel adjustments, Mayor Michael noted that $600,000 in revenue was needed to balance these costs. Council Member Steinorth inquired about the impact of the Affordable Care Act on part-time staffing levels. As the number of hours is proposed to be reduced for some positions, he inquired if the time to train new employees and the subsequent loss of knowledge was taken into consideration. Mr. Gillison confirmed that this had been specifically studied for each position. A cut in hours could be accommodated in many positions. However, there are some specialized positions in which this alternative may not be recommended. These positions are currently being reviewed. In response to Mayor Michael, Mr. Gillison addressed the available alternatives to adjusting to the Affordable Care Act. One alternative would be to provide affordable health care to all part time staff working 25 hours of more. Staff has reviewed the guidelines and determined that a $400 per month per position would be needed. Another alternative would be to pay a fine for not providing the coverage. The compromise proposed is to reduce the hours for most part time positions with affordable health care being provided for the remainder. Which alternative to choose is a policy decision to be made by the City Council. In response to Mayor Pro Tern Spagnolo, Mr. Gillison confirmed that there is no provision in the Affordable Care Act for part time employees to use existing insurance. The City Manager noted; however, in the future the law may be amended to further define what part time status is. This may eventually require the City to choose to provide affordable health care insurance to everyone. Mr. Gillison continued with the Fiscal Year 2013/14 budget highlights. He reported that the proposed budget includes an increase to the Sheriff's contract. As there are future anticipated cost increases, he will be conducting an analysis of the cost of contract law enforcement services. Mr. Gillison reported that community clean-ups will be increased from one to three events per year; there is a restoration of hours at the Household Hazardous Waste site and a restoration of book budgets, event supplies, and special event programming. Funding has also been included to enhance senior transportation. The City Manager reported that work continues toward ensuring long-term fiscal sustainability in landscape and street lighting districts citywide. He noted that Landscape Maintenance District No. 2 is currently * DRAFT * Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013 - Page 2 of 4 undergoing a property owner mail ballot, with the results being decided on June 5, 2013. If the mail ballot process passes, there will be an increased assessment and if it fails, services and maintenance should be reduced. In response to Mayor Michael, Mr. Gillison indicated an estimated 1.4 million dollars would be needed to cover the total deficit for all Districts per year. Mr. Gillison noted that the preliminary budget includes funding for the Metrolink Station. He expected that the next districts to be considered for a rate increase would be PD 85 and LMD 1 as both are currently operating at a deficit. Also discussed various legal issues which impact the City. The Public Employee Pension Reform Act enacted new, much lower pension benefit tiers and other changes for new employees hired after January 1, 2013. Mr. Gillison noted that the City is well-positioned to recognize an optimum amount of savings from PEPRA. He noted that the Public Employees' Retirement System has implemented additional reform measures to help ensure financial stability of the pension system. While this is a positive step for the long term viability of the system, Mr. Gillison expected that pension costs would rise by 6-11%of pay over the next several years. Also discussed was the Property Tax Administration Fees. The County's increased fees were challenged by many local agencies and the California Supreme Court sided with local agencies in this dispute. In response to Mayor Pro Tern Spagnolo, Mr. Gillison noted that the refund amount due to the City is still be litigated. Mr. Gillison discussed the waste and storm water related regulation, noting that the MS4 permit now has 31 new requirements that are impacting the City. The budget proposes adding a full-time position in the Environmental Programs section to help stay in compliance with the regulations. In response to Mayor Michael, Mr. Gillison confirmed that the MS4 permit is a Federal requirement, which mandates regular inspections by the City. Funding for special events was discussed. Mr. Gillison noting that the budget proposes a dedicated line item of $89,000 for public sector costs to properly manage the Thoroughbred Holiday Light Display. In response to Council Member Alexander, Mr. Gillison estimated that $66,000 was spent in 2012. He noted; however, that the cost to manage this event will fluctuate due to the number of weekends before Christmas and the weather. In response to Council Member Alexander, Mr. Gillison confirmed that the General Fund would pay for this expense. Council Member Alexander noted that this is not dissimilar to the budgetary needs of Landscape Maintenance District#2, but in that case the property owners in that District pay. Mayor Michael noted that there has been discussion about decorating homes for Halloween. He suggested that staff explore options to ensure that a light display like this not happen again. In response, Mr. Gillison indicated that a permit could be required along with specific requirements. Council Member Williams inquired if a business license and a permit from the Health Department would be obtained during the Thoroughbred Holiday Light Display. Mr. Gillison confirmed that these permits would be needed. Mr. Gillison discussed the proposed operating budgets for Fiscal Year 2013/14 and compared them to prior years. He addressed the key revenues for the City General Fund, which consists of sales tax, vehicle license fees, franchise fees, property tax, development fees, business licenses and transient occupancy taxes. In response to Council Member Williams, Mr. Gillison noted that the number of foreclosures and short sales have returned back down to their historical level and did not anticipate that much of the property tax is being received on a one time basis. The revenue sources for the Fire District and Library funds were also discussed. Mr. Gillison discussed the changes in the operating budgets and the reserve levels over the years. Council Member Steinorth wondered if the City is doing all it should to enhance its reserves. In response, Mr. Gillison noted that it is a balancing act that would require the City to keep cutting services to fully repay the reserves. He noted that these reserves were built over time. Also, what is not spent at the remainder of the fiscal year is placed back into the reserve. This is how all of the reserves were historically built. Mayor Michael noted the need to rebuild the reserves lost with the elimination of the redevelopment agency. In response, Mr. Gillison noted that for the first time, it is proposed to place $508,000 into the City's capital reserve. * DRAFT * Proposed Budgets for Fiscal Year 2013/14 Fire Protection District, City Council Minutes May 30, 2013- Page 3 of 4 Mr. Gillison presented an operating fund analysis for the City General Fund and the Fire District. Mayor Michael noted a proposed use of reserves for CFD 85-1. This is due to CAP allocation and revenue reductions. In response to Mayor Michael, Mr. Gillison noted that non-CFD property tax revenue growth from the RDA elimination continues and should help to eliminate the use of reserves. Mr. Gillison presented an operating fund analysis for the Library Budget. Property tax growth has enabled the Library to partially restore operating budget cuts from the prior year. However, he noted that $180,000 has been lost from the CLSA Direct Loan and Public Library Foundation programs. Consequently, the Library has been maintaining certain vacancies and implementing successful grant programs that have helped shore-up services. Lastly, Mr. Gillison discussed the proposed Capital Improvement Program. There is an ongoing investment in pavement rehabilitation, Americans with Disabilities Act projects, park and playground repairs, and facilities improvements. Planned capital improvements include the 1-15/Base Line interchange, the development of the second floor design for the Biane Library, the final design of Southwest Cucamonga Park, LED street light enhancement project in Street Light District 8 and two utility underground projects. RCMU is doing a line extension along Church Street from Bass Pro to Etiwanda Avenue; there are five sidewalk improvement projects planned and nineteen street improvement projects. Also, he noted that City Hall will be reroofed and the fueling infrastructure at the City Yard will be improved. In summary, Mr. Gillison reported that the City remains committed to maintaining its 30+ year tradition of fiscal stability and providing the highest quality services within budgetary constraints for the community. Looking ahead, he noted that careful plans should be laid in order to ensure high development standards are kept, the infrastructure is properly maintained and that long-term fiscal sustainability of the organization remains at the forefront. Mr. Gillison noted that a second budget workshop has been scheduled for June 6, 2013 at 5:00 p.m. Mayor Michael encouraged the City Council members to meet with the City Manager with their specific questions so that policy decisions, if needed, could be made at the next meeting. I E. ADJOURNMENT I The meeting adjourned at 6:35 p.m. Respectfully submitted, Debra L. 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(0 E c 3 4.1 c I= a) 0 at TO LOB '&10 en, -= E L O 4= 3 E L lw O L L O a) ra = H �• � � � OC � �— c� s > to) k ... ri. . u) 0 d f IY!, . c.., J. a4S *R '' d F U17) C...) 4r _,., C...)t24 90 t � LE a) 1 0' RANCHO CUCAMONGA FIRE PROTECTION DISTRICT P1 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337373 2013/06/191 ACE WEED ABATEMENT INC 190.00 AP 00337373 2013/06/19 I ACE WEED ABATEMENT INC 545.00 AP 00337373 2013/06/19 I ACE WEED ABATEMENT INC 580.00 AP 00337373 2013/06/191 ACE WEED ABATEMENT INC 670.00 AP 00337373 2013/06/19( ACE WEED ABATEMENT INC 670.00 AP 00337373 2013/06/19( ACE WEED ABATEMENT INC 705.00 AP 00337373 2013/06/19( ACE WEED ABATEMENT INC 1,205.00 AP 00337373 2013/06/19( ACE WEED ABATEMENT INC 295.00 AP 00337373 2013/06/19( ACE WEED ABATEMENT INC 545.00 AP 00337373 2013/06/191 ACE WEED ABATEMENT INC 190.00 AP 00337383 2013/06/191 ALL CITIES TOOLS 71.28 AP 00337398 2013/06/191 BURTON'S FIRE INC 393.06 AP 00337398 2013/06/191 BURTON'S FIRE INC 193.59 AP 00337404 2013/06/19( CARQUEST AUTO PARTS 81.98 AP 00337404 2013/06/19 CARQUEST AUTO PARTS 40.37 AP 00337413 2013/06/191 COSTELLO, MIKE 20.64 AP 00337413 2013/06/191 COSTELLO, MIKE 152.08 AP 00337431 2013/06/191 GOLDEN STATE RISK MANAGEMENT AUTHORI" 1,026.00 AP 00337451 2013/06/19 I LARKIN, DAVID W 370.30 AP 00337456 2013/06/19( LOWES COMPANIES INC. 53.70 AP 00337456 2013/06/19( LOWES COMPANIES INC. 43.43 AP 00337456 2013/06/19( LOWES COMPANIES INC. 89.86 AP 00337456 2013/06/19( LOWES COMPANIES INC. 10.24 AP 00337456 2013/06/19( LOWES COMPANIES INC. 93.37 Ap 00337456 2013/06/191 LOWES COMPANIES INC. 168.60 Ap 00337456 2013/06/191 LOWES COMPANIES INC. -16.38 AP 00337456 2013/06/191 LOWES COMPANIES INC. 40.91 AP 00337456 2013/06/191 LOWES COMPANIES INC. 32.75 AP 00337456 2013/06/191 LOWES COMPANIES INC. 30.75 AP 00337456 2013/06/19 I LOWES COMPANIES INC. 51.19 AP 00337456 2013/06/19 I LOWES COMPANIES INC. 9.17 AP 00337456 2013/06/19( LOWES COMPANIES INC. 8.18 AP 00337456 2013/06/19( LOWES COMPANIES INC. 42.02 AP 00337456 2013/06/19( LOWES COMPANIES INC. 65.52 AP 00337456 2013/06/19( LOWES COMPANIES INC. 154.44 AP 00337473 2013/06/191 PHYSIO CONTROL INC 15,110.04 AP 00337474 2013/06/191 PLUMMER,JACQUES 200.00 AP 00337474 2013/06/191 PLUMMER,JACQUES 50.00 AP 00337477 2013/06/19 I PROBST,GARY 10.05 AP 00337478 2013/06/19( PROGRESSIVE MEDICAL INTERNATIONAL 3,457.69 AP 00337502 2013/06/19( SNAWDER, RICK 20.00 AP 00337502 2013/06/19( SNAWDER, RICK 20.00 AP 00337502 2013/06/191 SNAWDER, RICK 50.00 AP 00337502 2013/06/191 SNAWDER, RICK 399.00 AP 00337507 2013/06/191 SOUTHERN CALIFORNIA EDISON 1,862.01 User: VLOPEZ-VERONICA LOPEZ Page: I Current Date: 06/26/: Report:CKAGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:2 RANCHO CUCAMONGA FIRE PROTECTION DISTRICT P2 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amoum AP 00337507 2013/06/19( SOUTHERN CALIFORNIA EDISON 1,862.01 AP 00337513 2013/06/19( SWIFTY SIGN 168.48 AP 00337516 2013/06/19( TECOTZKY, RALPH 50.00 AP 00337518 2013/06/19( TOLL, RICHARD 50.00 AP 00337536 2013/06/19( WALKER, ROBERT 250.00 AP 00337538 2013/06/19( WATSON,TINA 20.00 AP 00337540 2013/06/19( WELLS, ERIC 200.00 AP 00337547 2013/06/20( AIRGAS USA LLC 19.72 AP 00337547 2013/06/20( AIRGAS USA LLC 39.85 AP 00337559 2013/06/20( UNIFIRST UNIFORM SERVICE 87.30 AP 00337559 2013/06/20( UNIFIRST UNIFORM SERVICE 57.88 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 295.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 295.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 190.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 420.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 420.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 545.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 190.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 190.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 190.00 AP 00337123 2013/06/12( ACE WEED ABATEMENT INC 1,830.00 AP 00337129 2013/06/121 AIR& HOSE SOURCE INC. 79.29 AP 00337131 2013/06/12( ALL CITIES TOOLS 117.72 AP 00337142 2013/06/121 AT&T MOBILITY 41.45 AP 00337153 2013/06/121 BOUND TREE MEDICAL LLC. 2,108.08 AP 00337155 2013/06/121 BURNS, BRYAN 19.90 AP 00337173 2013/06/121 CAPITAL ONE COMMERCIAL 310,67 AP 00337174 2013/06/121 CARNES, SANDY 31.97 AP 00337174 2013/06/121 CARNES, SANDY 36.52 AP 00337175 2013/06/121 CARQUEST AUTO PARTS 75.62 AP 00337182 2013/06/121 CHIEF SUPPLY 46.01 AP 00337182 2013/06/121 CHIEF SUPPLY 314.80 AP 00337182 2013/06/121 CHIEF SUPPLY 155.04 AP 00337182 2013/06/121 CHIEF SUPPLY 93.44 AP 00337183 2013/06/121 CLARKE PLUMBING SPECIALTIES INC. 183.06 AP 00337186 2013/06/121 CLF WAREHOUSE 206.72 AP 00337186 2013/06/121 CLF WAREHOUSE 101.81 AP 00337194 2013/06/12( DANIELS TIRE SERVICE 386.06 AP 00337194 2013/06/12( DANIELS TIRE SERVICE 190.14 AP 00337194 2013/06/12( DANIELS TIRE SERVICE -338.76 AP 00337194 2013/06/12( DANIELS TIRE SERVICE -166.84 AP 00337194 2013/06/12( DANIELS TIRE SERVICE 90.00 AP 00337202 2013/06/121 EIGHTH AVENUE ENTERPRISE LLC 64.80 AP 00337202 2013/06/121 EIGHTH AVENUE ENTERPRISE LLC 495.20 AP 00337203 2013/06/12 1 FAILSAFE TESTING 82.08 User: VLOPEZ-VERONICA LOPEZ Page: 2 Current Date; 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:2 RANCHO CUCAMONGA FIRE PROTECTION DISTRICT p3 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337203 2013/06/12( FAILSAFE TESTING 40.42 AP 00337203 2013/06/12( FAILSAFE TESTING 1,285.81 AP 00337203 2013/06/121 FAILSAFE TESTING 2,610.59 AP 00337206 2013/06/121 FIREMASTER 1,956.99 AP 00337206 2013/06/121 FIREMASTER 963.89 AP 00337208 2013/06/121 FORCIBLE ENTRY EQUIPMENT 4,985.00 AP 00337209 2013/06/121 FRANKLIN TRUCK PARTS 96.39 AP 00337209 2013/06/12 1 FRANKLIN TRUCK PARTS 47.47 AP 00337209 2013/06/12 1 FRANKLIN TRUCK PARTS -129.60 AP 00337210 2013/06/12 I FRASURE,JULIE 50.00 AP 00337221 2013/06/121 GRACIANO,TAMMIE 199.00 AP 00337222 2013/06/12( GRAINGER 23.72 AP 00337222 2013/06/12( GRAINGER 77.71 AP 00337222 2013/06/12( GRAINGER 54.78 AP 00337226 2013/06/121 HARTRICK, PATRICK 20.00 AP 00337229 2013/06/121 HOLT, DANNY 160.37 AP 00337232 2013/06/121 HOSE MAN INC 156.16 AP 00337232 2013/06/121 HOSE MAN INC 85.64 AP 00337232 2013/06/121 HOSE MAN INC 42.17 AP 00337232 2013/06/12 1 HOSE MAN INC 46.21 AP 00337232 2013/06/12 1 HOSE MAN INC 76.91 AP 00337232 2013/06/12 1 HOSE MAN INC 152.30 AP 00337232 2013/06/12 I HOSE MAN INC 75.00 AP 00337233 2013/06/12( HOYT LUMBER CO., SM 57.74 AP 00337233 2013/06/12( HOYT LUMBER CO., SM 24.45 AP 00337233 2013/06/12( HOYT LUMBER CO., SM 16.68 AP 00337239 2013/06/121 INLAND EMPIRE PROPERTY SERVICES INC 1,070.00 AP 00337239 2013/06/121 INLAND EMPIRE PROPERTY SERVICES INC 830.00 AP 00337239 2013/06/121 INLAND EMPIRE PROPERTY SERVICES INC 2,330.00 AP 00337239 2013/06/121 INLAND EMPIRE PROPERTY SERVICES INC 955.00 AP 00337239 2013/06/121 INLAND EMPIRE PROPERTY SERVICES INC 500.00 AP 00337252 2013/06/121 LAWSON PRODUCTS INC 524.13 AP 00337252 2013/06/12( LAWSON PRODUCTS INC 258.15 AP 00337254 2013/06/12( LIFE ASSIST INC 581.47 AP 00337268 2013/06/121 NATIONAL CONSTRUCTION RENTALS INC 170.19 AP 00337269 2013/06/121 NEXTEL 162.97 AP 00337274 2013/06/121 OFFICE DEPOT 124.16 AP 00337288 2013/06/121 PLUMMER,JACQUES 150.00 AP 00337288 2013/06/121 PLUMMER,JACQUES 100.00 AP 00337288 2013/06/121 PLUMMER,JACQUES -100.00 AP 00337288 2013/06/12( PLUMMER,JACQUES 79.20 AP 00337291 2013/06/12( PROGRESSIVE MEDICAL INTERNATIONAL 2,615.42 AP 00337294 2013/06/12( RAULS AUTO TRIM INC 65.67 AP 00337294 2013/06/121 RAULS AUTO TRIM INC 133.33 AP 00337301 2013/06/121 SAFE-ENTRY TECHNICAL INC 225.00 User: VLOPEZ-VERONICA LOPEZ Page: 3 Current Date: 06/26/: Report CK_AGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:2 RANCHO CUCAMONGA FIRE PROTECTION DISTRICT P4 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337308 2013/06/12( SC FUELS 1,295.30 AP 00337308 2013/06/12( SC FUELS 1,682.86 AP 00337308 2013/06/12( SC FUELS 1,007.93 AP 00337308 2013/06/121 SC FUELS 1,007.93 AP 00337308 2013/06/121 SC FUELS 1,227.92 AP 00337315 2013/06/121 SIGN SHOP,THE 1,425.60 AP 00337321 2013/06/12 l SOUTHERN CALIFORNIA EDISON 234.08 AP 00337321 2013/06/121 SOUTHERN CALIFORNIA EDISON 730.71 AP 00337321 2013/06/121 SOUTHERN CALIFORNIA EDISON 721.18 AP 00337326 2013/06/121 TERMINIX PROCESSING CENTER 42.00 AP 00337326 2013/06/121 TERMINIX PROCESSING CENTER 75.00 AP 00337326 2013/06/121 TERMINIX PROCESSING CENTER 81.00 AP 00337326 2013/06/121 TERMINIX PROCESSING CENTER 73.00 AP 00337326 2013/06/121 TERMINIX PROCESSING CENTER 65.00 AP 00337336 2013/06/121 VALLEY POWER SYSTEMS INC 423.04 AP 00337336 2013/06/121 VALLEY POWER SYSTEMS INC 208.36 AP 00337336 2013/06/12( VALLEY POWER SYSTEMS INC -96.79 AP 00337336 2013/06/12( VALLEY POWER SYSTEMS INC -47.66 AP 00337339 2013/06/121 VERIZON CALIFORNIA 536.20 AP 00337339 2013/06/12( VERIZON CALIFORNIA 478.20 AP 00337339 2013/06/12( VERIZON CALIFORNIA 129.67 AP 00337339 2013/06/12( VERIZON CALIFORNIA 20.16 AP 00337340 2013/06/12( VERIZON WIRELESS- LA 164.16 AP 00337342 2013/06/12( VORTEX INDUSTRIES INC 2,274.64 AP 00337342 2013/06/12( VORTEX INDUSTRIES INC 267.60 AP 00337342 2013/06/121 VORTEX INDUSTRIES INC 785.84 AP 00337342 2013/06/12 ( VORTEX INDUSTRIES INC 191.94 AP 00337342 2013/06/12( VORTEX INDUSTRIES INC 671.00 AP 00337342 2013/06/121 VORTEX INDUSTRIES INC 686.91 Ap 00337342 2013/06/12( VORTEX INDUSTRIES INC 956.00 AP 00337343 2013/06/121 WALKER, ROBERT 20.00 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 29.24 AP 00337344 2013/06/12( WALTERS WHOLESALE ELECTRIC CO 749.73 AP 00337345 2013/06/12( WAXIE SANITARY SUPPLY 547.66 AP 00337345 2013/06/12( WAXIE SANITARY SUPPLY 547.66 AP 00337345 2013/06/12( WAXIE SANITARY SUPPLY 182.56 AP 00337347 2013/06/12( WINZER CORPORATION 342.54 AP 00337347 2013/06/12( WINZER CORPORATION 168.71 AP 00337347 2013/06/121 WINZER CORPORATION 175.14 AP 00337347 2013/06/121 WINZER CORPORATION 86.25 AP 00337351 2013/06/131 AIRGAS USA LLC 106.89 AP 00337351 2013/06/13 ( AIRGAS USA LLC 58.27 AP 00337354 2013/06/13 l CITRUS MOTORS ONTARIO INC 662.59 AP 00337354 2013/06/13 ( CITRUS MOTORS ONTARIO INC 326.34 AP 00337354 2013/06/13 ( CITRUS MOTORS ONTARIO INC 103.42 User: VLOPEZ-VERONICA LOPEZ Page: 4 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:2 RANCHO CUCAMONGA FIRE PROTECTION DISTRICT P5 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amount AP 00337354 2013/06/131 CITRUS MOTORS ONTARIO INC 135.02 AP 00337354 2013/06/13 1 CITRUS MOTORS ONTARIO INC 66.49 AP 00337354 2013/06/13 ( CITRUS MOTORS ONTARIO INC 107.18 AP 00337358 2013/06/131 CUCAMONGA VALLEY WATER DISTRICT 938.05 AP 00337358 2013/06/131 CUCAMONGA VALLEY WATER DISTRICT 308.73 AP 00337358 2013/06/131 CUCAMONGA VALLEY WATER DISTRICT 55.20 AP 00337360 2013/06/13 ( EMCOR SERVICE 937.64 AP 00337363 2013/06/13 1 GENERATOR SERVICES CO 760.75 AP 00337363 2013/06/13 ( GENERATOR SERVICES CO 548.52 AP 00337363 2013/06/13 ( GENERATOR SERVICES CO 657.96 AP 00337363 2013/06/13 ( GENERATOR SERVICES CO 747.26 AP 00337363 2013/06/13 ( GENERATOR SERVICES CO 510.43 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 60.67 AP 00337371 2013/06/13 1 UNIFIRST UNIFORM SERVICE 81.04 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 27.07 Ap 00337371 2013/06/131 UNIFIRST UNIFORM SERVICE 27.18 AP 00337371 2013/06/131 UNIFIRST UNIFORM SERVICE 67.87 AP 00337371 2013/06/131 UNIFIRST UNIFORM SERVICE 41.68 AP 00337371 2013/06/131 UNIFIRST UNIFORM SERVICE 27.07 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 57.19 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 68.56 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 58.19 AP 00337371 2013/06/13 ( UNIFIRST UNIFORM SERVICE 39.36 EP 00003406 2013/06/12( BANTAU, VICTORIA 816.87 Total for Entity: 94,618.11 User: VLOPEZ-VERONICA LOPEZ Page: 5 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:2 P6 STAFF REPORT JPUBLIC WORKS SERVICES DEPARTMENT RANC HO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council Chairman and Members of the Successor Agency John R. Gillison, City Manager. From: William Wittkopf, Public Works Services Director By: Ty Quaintance, Facilities Maintenance Superintendent Kenneth Fung, Assistant Engineer Subject: ACCEPT THE CITY YARD EXPANSION PROJECT, CONTRACT NO. 11-068/RA11- 009 AS COMPLETE; RELEASE THE FAITHFUL PERFORMANCE BOND; ACCEPT A MAINTENANCE BOND; RELEASE THE LABOR AND MATERIALS BOND; APPROVE A RESOLUTION AUTHORIZING THE PUBLIC WORKS SERVICES DIRECTOR TO FILE A NOTICE OF COMPLETION; RELEASE THE RETENTION 35 DAYS AFTER ACCEPTANCE AND APPROVE THE FINAL CONTRACT AMOUNT OF $11,455,397.00 RECOMMENDATION It is recommended that the City Council and the Successor Agency accept the City Yard Expansion Project, Contract No. 11-068/RA11-009, as complete, release the Faithful Performance Bond, accept a Maintenance Bond; authorize the release of the Labor and Materials Bond in the amount of $10,800,000.00 six months after the recordation of said notice if no claims have been received, approve a resolution authorizing the Public Works Services Director to file a Notice of Completion, authorize the release of the retention in the amount of $571,189.01, 35 days after acceptance and approve the final contract amount of $11,455,397.00. BACKGROUND/ANALYSIS The subject project has been completed in accordance with the approved plans and specifications and to the satisfaction of the Public Works Services Director. The City Yard Expansion Project scope of work consisted of the construction of a Public Works Services building, the construction of an all-weather Household Hazardous Waste collection facility, a new vehicle wash rack facility plus associated parking, drainage and landscape improvements. Pertinent information of the project is as follows: Budgeted Amount (and Account $1,944,360.00 (1188313-5650/1525188-0) Numbers): $3,172,527.00 (1025001-5650/1650025-0) $5,685,113.00 (2660801-5650/1650660-0) Engineer's Estimate: $11,500,000.00 City Council Approval to Advertise: March 2, 2011 P7 CITY COUNCIL AND SUCCESSOR AGENCY STAFF REPORT Re: CITY YARD EXPANSION PROJECT- NOTICE OF COMPLETION July 3, 2013 Page 2 Publish dates for local paper: March 8, 2011 and March 15, 2011 > Bid Opening: April 26, 2011 > Contract Award Date: June 1, 2011 • Low Bidder: Oakview Constructors, Inc. of Calimesa • Contract Amount: $10,802,000.00 • Contingency: $194,436.00 (1188313-5650/1525188-0) $885,764.00 (2660801-5650/1650660-0) • Final Contract Amount: $11,455,397.00 • Difference in Contract Amount: $653,397.00 (6.05%) The net increase in the total cost of the project is a result of nine (9) Contract Change Orders (CCO). The Contract Change Orders were a mixture of changes requested by the City such as the Storm Drain Truck Dump Station and revisions to the type of metal roofing system (CCO #009), additional work required by utilities such as the SCE required revisions to the project's electrical services (CCO #004) and items that were not covered in the original contract such as the construction of an on-site storm drain diversion channel due to the delay in the construction of the Hellman Storm Drain (CCO #002), associated with the State taking of RDA funds. Respectfully submitted, William Wittkopf Public Works Services Director W W/TQ:kf P8 RESOLUTION NO. 13-096 A RESOLUTION OF THE CITY COUNCIL AND THE SUCCESSOR AGENCY OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ACCEPTING THE CITY YARD EXPANSION PROJECT, CONTRACT NO. 11-068/RA11-009 AND AUTHORIZING THE FILING OF A NOTICE OF COMPLETION FOR THE WORK WHEREAS, the City Yard Expansion Project, Contract No. 11-068/RA11- 009, has been completed to the satisfaction of the Public Works Services Director; and WHEREAS, a Notice of Completion is required to be filed, certifying the work complete. NOW, THEREFORE, the City Council and the Successor Agency of the City of Rancho Cucamonga hereby resolves, that the work is hereby accepted and the Public Works Services Director is authorized to sign and file a Notice of Completion with the County Recorder of San Bernardino County. 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CITY OF RANCHO CUCAMONGA P10 Agenda Cheek Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amoum AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/191 ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 25.00 AP 00337377 2013/06/191 ADOBE ANIMAL HOSPITAL 25.00 AP 00337377 2013/06/191 ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/191 ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337377 2013/06/19( ADOBE ANIMAL HOSPITAL 50.00 AP 00337385 2013/06/19( ALPHAGRAPHICS 68.04 AP 00337385 2013/06/191 ALPHAGRAPHICS 1,225.11 AP 00337385 2013/06/19 I ALPHAGRAPHICS 368.33 AP 00337387 2013/06/191 ANIMAL HEALTH& SANITARY SUPPLY 194.40 AP 00337387 2013/06/191 ANIMAL HEALTH& SANITARY SUPPLY 1,139.20 AP 00337392 2013/06/191 AUTO AND RV SPECIALISTS INC. 36.94 AP 00337394 2013/06/191 BARBARA'S ANSWERING SERVICE 588.63 AP 00337399 2013/06/191 BYRNE,CHELSEA 15.00 AP 00337399 2013/06/19( BYRNE, CHELSEA 100.00 AP 00337402 2013/06/19( CALIFORNIA VETERINARY SPECIALISTS 209.74 AP 00337411 2013/06/191 COMMERCIAL CLAIMS INC. 25.00 AP 00337416 2013/06/19( DATA ARC LLC 2,460.05 AP 00337418 2013/06/19( DELTA CARE USA 1,687.64 Ap 00337421 2013/06/19( DREAM SHAPERS 450.00 AP 00337426 2013/06/191 FIERRO,ALEX 576.26 AP 00337436 2013/06/191 HALO BRANDED SOLUTIONS 359.98 AP 00337441 2013/06/191 IBM CORPORATION 297.36 AP 00337443 2013/06/19( INLAND VALLEY EMERGENCY PET CLINIC 52.50 AP 00337443 2013/06/19( INLAND VALLEY EMERGENCY PET CLINIC 52.50 AP 00337443 2013/06/19( INLAND VALLEY EMERGENCY PET CLINIC 500.00 AP 00337450 2013/06/19( LAIRD CONSTRUCTION CO 5,852.56 AP 00337453 2013/06/191 LITTLE BEAR PRODUCTIONS 285.00 AP 00337453 2013/06/191 LITTLE BEAR PRODUCTIONS 450.00 AP 00337453 2013/06/19( LITTLE BEAR PRODUCTIONS 150.00 AP 00337453 2013/06/191 LITTLE BEAR PRODUCTIONS 2,475.00 AP 00337453 2013/06/19( LITTLE BEAR PRODUCTIONS 1,300.00 AP 00337453 2013/06/19( LITTLE BEAR PRODUCTIONS 870.00 AP 00337457 2013/06/19( MAIN STREET SIGNS 1,457.08 AP 00337460 2013/06/191 MIDWEST TAPE 15.19 AP 00337460 2013/06/191 MIDWEST TAPE 15.19 User: VLOPEZ- VERONICA LOPEZ Page: 1 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P11 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337461 2013/06/19( MOUNTAIN VIEW SMALL ENG REPAIR 15.10 AP 00337461 2013/06/191 MOUNTAIN VIEW SMALL ENG REPAIR 53.05 AP 00337461 2013/06/19( MOUNTAIN VIEW SMALL ENG REPAIR 68.03 AP 00337461 2013/06/191 MOUNTAIN VIEW SMALL ENG REPAIR 38.58 AP 00337467 2013/06/191 OFFICE DEPOT 26.98 AP 00337467 2013/06/191 OFFICE DEPOT 13.61 AP 00337467 2013/06/191 OFFICE DEPOT 19.89 AP 00337467 2013/06/191 OFFICE DEPOT 25.86 AP 00337467 2013/06/191 OFFICE DEPOT 57.18 AP 00337467 2013/06/191 OFFICE DEPOT 548.02 AP 00337467 2013/06/191 OFFICE DEPOT 4.23 AP 00337467 2013/06/191 OFFICE DEPOT 317.23 AP 00337467 2013/06/191 OFFICE DEPOT 173.28 AP 00337467 2013/06/191 OFFICE DEPOT 38.31 AP 00337467 2013/06/191 OFFICE DEPOT 46.05 AP 00337467 2013/06/191 OFFICE DEPOT 8.93 AP 00337467 2013/06/191 OFFICE DEPOT 3.30 AP 00337467 2013/06/191 OFFICE DEPOT 22.95 AP 00337467 2013/06/19( OFFICE DEPOT 8.49 AP 00337467 2013/06/19( OFFICE DEPOT 10.88 AP 00337467 2013/06/19( OFFICE DEPOT 228.74 AP 00337467 2013/06/191 OFFICE DEPOT 76.72 AP 00337467 2013/06/19( OFFICE DEPOT 61.52 AP 00337467 2013/06/19( OFFICE DEPOT 249.42 AP 00337467 2013/06/191 OFFICE DEPOT 60.46 AP 00337467 2013/06/191 OFFICE DEPOT 125.45 AP 00337467 2013/06/19( OFFICE DEPOT -21.19 AP 00337467 2013/06/191 OFFICE DEPOT 88.96 AP 00337467 2013/06/191 OFFICE DEPOT 81.49 AP 00337481 2013/06/191 QUEENSBORO SHIRT COMPANY 858.76 AP 00337481 2013/06/19( QUEENSBORO SHIRT COMPANY 45.65 AP 00337487 2013/06/19( RED WING SHOE STORE 136.07 AP 00337491 2013/06/19( RIM DESIGN GROUP INC 21,347.85 AP 00337493 2013/06/191 ROADRUNNER PHARMACY 196.88 AP 00337493 2013/06/19( ROADRUNNER PHARMACY 797.58 AP 00337501 2013/06/19( SIR SPEEDY 61.56 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 8,747.36 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 5,981.10 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 22,279.61 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 16,439.72 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 3,663,43 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 14,221.73 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 34.88 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 123.02 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 4,377.83 User: VLOPEZ-VERONICA LOPEZ Page: 2 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P12 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 43,977.72 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 22,279.61 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 1,741.30 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 11,141.69 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 4,405.04 AP 00337508 2013/06/19( SOUTHERN CALIFORNIA EDISON 4,775.33 AP 00337508 2013/06/191 SOUTHERN CALIFORNIA EDISON 14,506.61 AP 00337515 2013/06/19( TANNER RECOGNITION COMPANY,0 C 219.10 Ap 00337524 2013/06/191 UNITED PACIFIC SERVICES INC 4,700.00 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 53.99 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 169.89 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 85.52 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 121.81 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 912.97 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 137.32 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 12,237.62 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 127.57 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 499.46 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 1,225.36 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 115.71 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 718.29 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 731.94 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 245.05 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 147.86 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 67.27 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 167.01 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 135.65 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 140.61 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 331.41 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 209.93 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 251.09 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 392.08 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 50.94 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 125.36 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 74.07 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 70.52 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 287.07 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 54.20 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 44.42 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 135.72 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 1,526.70 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 719.63 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 54.20 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 65.63 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 150.34 User: VLOPEZ- VERONICA LOPEZ Page: 3 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P13 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amount AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 219.66 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 1,138.82 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 1,185.07 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 241.23 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 944.98 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 830.64 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 174.29 AP 00337549 2013/06/20( CUCAMONGA VALLEY WATER DISTRICT 417.80 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 208.29 AP 00337549 2013/06/201 CUCAMONGA VALLEY WATER DISTRICT 201.71 AP 00337549 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Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P30 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amoum Ap 00337558 2013/06/20( TRUGREEN LANDCARE 4,569.60 AP 00337558 2013/06/20( TRUGREEN LANDCARE 14,406.68 AP 00337558 2013/06/201 TRUGREEN LANDCARE 1,075.68 AP 00337560 2013/06/24 1 BENEFIT SERVICE CENTER INC 324.00 AP 00337126 2013/06/121 AEI-CASC CONSULTING 13,154.72 AP 00337128 2013/06/12( AGUSTIN,MARIA 500.00 AP 00337132 2013/06/121 ALL CITY MANAGEMENT SERVICES INC. 19,888.96 AP 00337133 2013/06/121 ALL WELDING 2,628.80 AP 00337133 2013/06/121 ALL WELDING 1,000.00 AP 00337133 2013/06/121 ALL WELDING 60.00 AP 00337139 2013/06/121 ARBOR NURSERY PLUS 90.72 AP 00337143 2013/06/121 AUFBAU CORPORATION 2,744.00 AP 00337143 2013/06/121 AUFBAU CORPORATION 2,156.00 AP 00337143 2013/06/121 AUFBAU CORPORATION 8,526.00 AP 00337143 2013/06/121 AUFBAU CORPORATION 4,263.00 AP 00337145 2013/06/121 AYUDA,ADRIANA'S DECISION 250.00 AP 00337157 2013/06/121 CADET TIRE COMPANY INC. 4,694.20 AP 00337158 2013/06/121 CAL POLY POMONA FOUNDATION INC. 2,250.00 AP 00337167 2013/06/121 CALIFORNIA FRANCHISE TAX BOARD 150.00 AP 00337168 2013/06/121 CALIFORNIA SHOPPING CART RETRIEVAL CORI 45.00 AP 00337187 2013/06/121 COAST FITNESS QUALITY SALES& SERVICE 6,858.00 AP 00337199 2013/06/121 DUVAL,TERRI A 500.00 AP 00337201 2013/06/121 ECONOLITE CONTROL PRODUCTS INC 5,298.48 AP 00337216 2013/06/121 GALLS RETAIL CA LOCK BOX 109.18 AP 00337216 2013/06/121 GALLS RETAIL CA LOCK BOX 109.18 AP 00337224 2013/06/121 GREEN ROCK POWER EQUIPMENT 60.32 AP 00337224 2013/06/121 GREEN ROCK POWER EQUIPMENT 177.96 AP 00337224 2013/06/121 GREEN ROCK POWER EQUIPMENT 73.35 AP 00337227 2013/06/121 HERITAGE EDUCATION GROUP 231.00 AP 00337227 2013/06/121 HERITAGE EDUCATION GROUP 203.00 AP 00337237 2013/06/121 IMPRESSIONS GOURMET CATERING 180.90 AP 00337237 2013/06/12( IMPRESSIONS GOURMET CATERING 180.90 AP 00337250 2013/06/12( LAKESHORE LEARNING MATERIALS 475.87 AP 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CUCAMONGA VALLEY WATER DISTRICT 81.06 Al, 00337361 2013/06/13 ( EWING IRRIGATION PRODUCTS 167.08 AP 00337366 2013/06/13 l INLAND VALLEY DAILY BULLETIN 1,400.24 AP 00337366 2013/06/13 l INLAND VALLEY DAILY BULLETIN 1,391.00 AP 00337366 2013/06/13 l INLAND VALLEY DAILY BULLETIN 1,354.04 Ap 00337366 2013/06/131 INLAND VALLEY DAILY BULLETIN 1,354.04 AP 00337366 2013/06/13 1 INLAND VALLEY DAILY BULLETIN 600.98 AP 00337366 2013/06/131 INLAND VALLEY DAILY BULLETIN 328.40 AP 00337366 2013/06/131 INLAND VALLEY DAILY BULLETIN 605.60 User: VLOPEZ- VERONICA LOPEZ Page: 24 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P34 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amount AP 00337384 2013/06/19( ALL CITY MANAGEMENT SERVICES INC. 7,154.43 AP 00337388 2013/06/19( ANTECH DIAGNOSTICS 527.31 AP 00337388 2013/06/19( ANTECH DIAGNOSTICS 631.80 AP 00337388 2013/06/19( ANTECH 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AP 00337339 2013/06/12( VERIZON CALIFORNIA 44.11 AP 00337339 2013/06/12( VERIZON CALIFORNIA 19.61 AP 00337339 2013/06/12( VERIZON CALIFORNIA 44.11 AP 00337339 2013/06/12 ( VERIZON CALIFORNIA 46.16 AP 00337339 2013/06/12( VERIZON CALIFORNIA 45.49 AP 00337339 2013/06/121 VERIZON CALIFORNIA 220.79 AP 00337339 2013/06/121 VERIZON CALIFORNIA 44.11 AP 00337339 2013/06/121 VERIZON CALIFORNIA 45.51 AP 00337339 2013/06/12( VERIZON CALIFORNIA 92.09 AP 00337339 2013/06/12 1 VERIZON CALIFORNIA 45.49 AP 00337339 2013/06/121 VERIZON CALIFORNIA 19.61 AP 00337339 2013/06/121 VERIZON CALIFORNIA 44.11 AP 00337339 2013/06/121 VERIZON CALIFORNIA 185.10 AP 00337339 2013/06/121 VERIZON CALIFORNIA 45.49 AP 00337339 2013/06/121 VERIZON CALIFORNIA 44.77 AP 00337339 2013/06/121 VERIZON CALIFORNIA 88.23 AP 00337339 2013/06/12 ( VERIZON CALIFORNIA 176.48 AP 00337339 2013/06/12( VERIZON CALIFORNIA 136.49 AP 00337339 2013/06/121 VERIZON CALIFORNIA 47.61 AP 00337339 2013/06/121 VERIZON CALIFORNIA 24.76 AP 00337339 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Date: 06/26/: Report: CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P38 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337532 2013/06/19( VERIZON WIRELESS- LA 31.94 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 84.89 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 31.94 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 36.71 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 36.71 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 38.01 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 34.67 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 39.58 AP 00337532 2013/06/191 VERIZON WIRELESS- LA 38.01 AP 00337532 2013/06/19( VERIZON WIRELESS - LA 38.05 AP 00337532 2013/06/19( VERIZON WIRELESS- LA 38.03 AP 00337532 2013/06/19( VERIZON WIRELESS- LA 36.71 AP 00337532 2013/06/19( VERIZON WIRELESS- LA - 101.77 AP 00337532 2013/06/19( VERIZON WIRELESS- LA 67.61 AP 00337532 2013/06/19( VERIZON WIRELESS- LA 36.71 AP 00337532 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00337185 2013/06/121 CLEARWATER GRAPHICS INC 891.00 AP 00337190 2013/06/121 CROP PRODUCTION SERVICES INC 1,759.86 AP 00337190 2013/06/121 CROP PRODUCTION SERVICES INC 610.78 User: VLOPEZ-VERONICA LOPEZ Page: 30 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P40 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amount AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 26.38 AP 00337205 2013/06/12 I FEDERAL EXPRESS CORP 20.64 AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 31.43 AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 26.69 AP 00337205 2013/06/12 I FEDERAL EXPRESS CORP 48.55 AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 20.64 AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 33.36 AP 00337205 2013/06/121 FEDERAL EXPRESS CORP 23.85 AP 00337214 2013/06/121 G AND M BUSINESS INTERIORS 2,603.16 AP 00337220 2013/06/121 GOOD YEAR WHOLESALE 396.84 AP 00337231 2013/06/12( HOOD, KARYE 93.56 AP 00337234 2013/06/12( HUGHES,RANCE 36.73 AP 00337241 2013/06/12( INTEGRITY DOOR& HARDWARE INC 801.21 AP 00337242 2013/06/12( INTERNATIONAL EZ UP INC 2,149.20 AP 00337256 2013/06/12( LUCKY FEET SHOES INC 151.15 AP 00337257 2013/06/12 1 MAIN STREET SIGNS 49.63 AP 00337257 2013/06/121 MAIN STREET SIGNS 694.66 AP 00337257 2013/06/12 1 MAIN STREET SIGNS 178.20 AP 00337257 2013/06/121 MAIN STREET SIGNS 647.57 AP 00337257 2013/06/121 MAIN STREET SIGNS 1,165.75 AP 00337259 2013/06/121 MARIPOSA HORTICULTURAL ENT INC 1,818.32 AP 00337259 2013/06/121 MARIPOSA HORTICULTURAL ENT INC 1,581.61 AP 00337259 2013/06/121 MARIPOSA HORTICULTURAL ENT INC 1,621.61 AP 00337259 2013/06/12( MARIPOSA HORTICULTURAL ENT INC 1,422.89 AP 00337262 2013/06/121 MIDWEST TAPE 57.38 AP 00337262 2013/06/12( MIDWEST TAPE 51.96 AP 00337262 2013/06/12( MIDWEST TAPE 54.96 AP 00337262 2013/06/12( MIDWEST TAPE 26.98 AP 00337262 2013/06/12( MIDWEST TAPE 83.54 AP 00337262 2013/06/121 MIDWEST TAPE 91.97 AP 00337262 2013/06/121 MIDWEST TAPE 26.98 AP 00337262 2013/06/121 MIDWEST TAPE 83.14 AP 00337262 2013/06/121 MIDWEST TAPE 105.36 AP 00337262 2013/06/121 MIDWEST TAPE 289.53 AP 00337263 2013/06/12( MIJAC ALARM COMPANY 102.00 AP 00337263 2013/06/12( MIJAC ALARM COMPANY 168.00 AP 00337264 2013/06/12 ( MILLER,GARY 2,529.00 AP 00337264 2013/06/12( MILLER,GARY 16,142.00 AP 00337271 2013/06/121 NWOSU,LORETHA 30.51 AP 00337272 2013/06/12( OCLC INC 47.66 AP 00337295 2013/06/121 RBM LOCK AND KEY SERVICE 3.78 AP 00337295 2013/06/12( RBM LOCK AND KEY SERVICE 3.78 AP 00337295 2013/06/12( RBM LOCK AND KEY SERVICE 23.22 AP 00337296 2013/06/121 RED WING SHOE STORE 137.33 AP 00337311 2013/06/12( SHERIFFS COURT SERVICES 30.51 User: VLOPEZ-VERONICA LOPEZ Page: 31 Current Date: 06/26/: Report CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P41 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337323 2013/06/121 STERLING COFFEE SERVICE 199.00 • AP 00337323 2013/06/121 STERLING COFFEE SERVICE 52.06 AP 00337324 2013/06/121 STOVER SEED COMPANY 1,398.61 AP 00337327 2013/06/121 THOMPSON BUILDING MATERIALS 55.11 AP 00337328 2013/06/121 TICKETS COM INC 9,664.80 AP 00337328 2013/06/121 TICKETS COM INC 1,105.00 AP 00337330 2013/06/121 TYPECARE 121.60 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 29.96 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 145.72 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 653.65 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 463.63 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 285.90 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 324.20 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 2.43 AP 00337344 2013/06/121 WALTERS WHOLESALE ELECTRIC CO 25.92 AP 00337345 2013/06/121 WAXIE SANITARY SUPPLY 1,008.12 AP 00337345 2013/06/121 WAXIE SANITARY SUPPLY 256.90 AP 00337345 2013/06/121 WAXIE SANITARY SUPPLY 98.71 AP 00337345 2013/06/121 WAXIE SANITARY SUPPLY 836.31 AP 00337346 2013/06/121 WERNER INTERNATIONAL ENTERPRISES INC 479.01 AP 00337346 2013/06/121 WERNER INTERNATIONAL ENTERPRISES INC 19.90 AP 00337348 2013/06/121 WRIGHT, PATRICIA 160.00 AP 00337352 2013/06/131 AUTO BODY 2000 1,836.22 AP 00337369 2013/06/13 1 PENNY PLUMBING 2,871.12 AP 00337369 2013/06/13 1 PENNY PLUMBING 1,025.40 AP 00337369 2013/06/131 PENNY PLUMBING 3,161.60 AP 00337396 2013/06/191 BLAINE WINDOW HARDARE INC. 687.25 AP 00337452 2013/06/191 LEW EDWARDS GROUP,THE 10,000.00 AP 00337466 2013/06/19 1 OCCUPATIONAL HEALTH CTRS OF CA 174.50 AP 00337466 2013/06/191 OCCUPATIONAL HEALTH CTRS OF CA 668.00 AP 00337466 2013/06/191 OCCUPATIONAL HEALTH CTRS OF CA 68.62 AP 00337466 2013/06/191 OCCUPATIONAL HEALTH CTRS OF CA 56.93 AP 00337472 2013/06/19( PHENIX ENTERPRISES INC 527.04 AP 00337527 2013/06/19( VAN SCOYOC ASSOCIATES INC 4,000.00 AP 00337118 2013/06/12( Al AUTOMOTIVE 158.88 AP 00337179 2013/06/12( CELEBRATION SENSATION INC. 500.00 AP 00337179 2013/06/12( CELEBRATION SENSATION INC. 522.00 AP 00337180 2013/06/12( CHARTER COMMUNICATIONS 109.99 AP 00337202 2013/06/12( EIGHTH AVENUE ENTERPRISE LLC 671.97 AP 00337219 2013/06/12( GILLISON,JOHN 500.00 AP 00337222 2013/06/12( GRAINGER 343.86 AP 00337222 2013/06/12( GRAINGER 24.78 AP 00337222 2013/06/121 GRAINGER 797.90 AP 00337222 2013/06/121 GRAINGER -8.43 AP 00337222 2013/06/121 GRAINGER 37.61 User: VLOPEZ- VERONICA LOPEZ Page: 32 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK: Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P42 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337222 2013/06/12( GRAINGER 755.05 AP 00337222 2013/06/12( GRAINGER 276.33 AP 00337222 2013/06/12( GRAINGER 152.06 AP 00337222 2013/06/121 GRAINGER 99.92 AP 00337222 2013/06/12( GRAINGER 1,226.88 AP 00337222 2013/06/121 GRAINGER 68.94 AP 00337222 2013/06/121 GRAINGER 125.51 AP 00337222 2013/06/12( GRAINGER 3.22 AP 00337222 2013/06/121 GRAINGER 126.65 AP 00337222 2013/06/121 GRAINGER 185.90 AP 00337244 2013/06/12( JOHN DEERE LANDSCAPES 10.22 AP 00337244 2013/06/12( JOHN DEERE LANDSCAPES 333.07 AP 00337244 2013/06/121 JOHN DEERE LANDSCAPES 13.91 AP 00337244 2013/06/121 JOHN DEERE LANDSCAPES 524.79 AP 00337244 2013/06/121 JOHN DEERE LANDSCAPES 746.92 AP 00337244 2013/06/121 JOHN DEERE LANDSCAPES 166.33 AP 00337289 2013/06/12( PRE-PAID LEGAL SERVICES INC 11.40 AP 00337289 2013/06/12( PRE-PAID LEGAL SERVICES INC 116.07 AP 00337310 2013/06/12( SHERIFFS COURT SERVICES 25.00 AP 00337349 2013/06/12( WYCOFF, LAURA 112.00 AP 00337400 2013/06/19( CAL PERS LONG TERM CARE 480.34 AP 00337405 2013/06/19( CDW GOVERNMENT INC. 275.04 AP 00337425 2013/06/19( FEDERAL EXPRESS CORP 20.27 AP 00337439 2013/06/19( HLP INC. 28,740.00 AP 00337439 2013/06/191 HLP INC. 28,800.00 AP 00337485 2013/06/19( RANCHO CUCAMONGA COMMUNITY&ARTS F( 110.00 AP 00337519 2013/06/191 TOOMOTH, DR MICHELE PERSON 102.83 AP 00337137 2013/06/121 AMTECH ELEVATOR SERVICES 220.24 AP 00337137 2013/06/121 AMTECH ELEVATOR SERVICES 270.46 AP 00337137 2013/06/121 AMTECH ELEVATOR SERVICES 250.37 AP 00337162 2013/06/121 CALIFORNIA FRANCHISE TAX BOARD 50.00 AP 00337204 2013/06/12( FASTENAL COMPANY 10.07 AP 00337204 2013/06/121 FASTENAL COMPANY 59.08 AP 00337204 2013/06/12( FASTENAL COMPANY 5.34 AP 00337230 2013/06/12( HOME DEPOT CREDIT SERVICES 645 -95.35 AP 00337230 2013/06/12( HOME DEPOT CREDIT SERVICES 645 53.97 AP 00337230 2013/06/12( HOME DEPOT CREDIT SERVICES 645 86.36 AP 00337230 2013/06/121 HOME DEPOT CREDIT SERVICES 645 64.17 AP 00337230 2013/06/121 HOME DEPOT CREDIT SERVICES 645 1,577.07 AP 00337230 2013/06/12( HOME DEPOT CREDIT SERVICES 645 9.63 AP 00337261 2013/06/12( MCMASTER CARR SUPPLY COMPANY 70.16 AP 00337261 2013/06/12( MCMASTER CARR SUPPLY COMPANY 117.14 AP 00337312 2013/06/12( SHERIFFS COURT SERVICES 150.00 AP 00337353 2013/06/13 ( BRODART BOOKS 16,193.52 AP 00337353 2013/06/13 ( BRODART BOOKS 18,506.88 User: VLOPEZ-VERONICA LOPEZ Page: 33 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC-CK:Agenda Check Register Portrait Layout Time: 15:1 CITY OF RANCHO CUCAMONGA P43 Agenda Check Register 6/12/2013 through 6/25/2013 Check No. Check Date Vendor Name Amouni AP 00337368 2013/06/13 l NEC CORPORATION OF AMERICA 14,057.01 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 12,608.55 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 657.09 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 507.43 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 3,085.69 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 2,767.73 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 2,924.89 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 13,324.51 AP 00337368 2013/06/13 ( NEC CORPORATION OF AMERICA 1,280.00 EP 00003408 2013/06/12( RCPFA 9,534.06 EP 00003409 2013/06/12( SHELL ENERGY NORTH AMERICA 11,100.00 EP 00003410 2013/06/12( EXELON GENERATION CO. LLC. 26,517.40 EP 00003412 2013/06/19( VIASYN INC 3,184.00 EP 00003412 2013/06/19( VIASYN INC 205.73 EP 00003407 2013/06/12( CALIF GOVERNMENT VEBA/RANCHO CUCAMOI 1,480.00 EP 00003407 2013/06/12( CALIF GOVERNMENT VEBA/RANCHO CUCAMOI 7,075.00 EP 00003411 2013/06/19( FORTISTAR METHANE GROUP LLC 96,177.68 Total for Entity: 2,077,194.84 User: VLOPEZ- VERONICA LOPEZ Page: 34 Current Date: 06/26/: Report:CK_AGENDA_REG_PORTRAIT_RC- CK: Agenda Check Register Portrait Layout Time: 15:1 // P44 STAFF REPORT K PUBLIC WORKS SERVICES DEPARTMENT RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council Chairman and Members of the Successor Agency John R. Gillison, City Manager From: William Wittkopf, Public Works Services Director By: Ty Quaintance, Facilities Maintenance Superintendent Kenneth Fung, Assistant Engineer Subject: ACCEPT THE CITY YARD EXPANSION PROJECT, CONTRACT NO. 11-068/RA11- 009 AS COMPLETE; RELEASE THE FAITHFUL PERFORMANCE BOND; ACCEPT A MAINTENANCE BOND; RELEASE THE LABOR AND MATERIALS BOND; APPROVE A RESOLUTION AUTHORIZING THE PUBLIC WORKS SERVICES DIRECTOR TO FILE A NOTICE OF COMPLETION; RELEASE THE RETENTION 35 DAYS AFTER ACCEPTANCE AND APPROVE THE FINAL CONTRACT AMOUNT OF $11,455,397.00 RECOMMENDATION It is recommended that the City Council and the Successor Agency accept the City Yard Expansion Project, Contract No. 11-068/RA11-009, as complete, release the Faithful Performance Bond, accept a Maintenance Bond; authorize the release of the Labor and Materials Bond in the amount of $10,800,000.00 six months after the recordation of said notice if no claims have been received, approve a resolution authorizing the Public Works Services Director to file a Notice of Completion, authorize the release of the retention in the amount of $571,189.01, 35 days after acceptance and approve the final contract amount of $11,455,397.00. BACKGROUND/ANALYSIS The subject project has been completed in accordance with the approved plans and specifications and to the satisfaction of the Public Works Services Director. The City Yard Expansion Project scope of work consisted of the construction of a Public Works Services building, the construction of an all-weather Household Hazardous Waste collection facility, a new vehicle wash rack facility plus associated parking, drainage and landscape improvements. Pertinent information of the project is as follows: > Budgeted Amount (and Account $1,944,360.00 (1188313-5650/1525188-0) Numbers): $3,172,527.00 (1025001-5650/1650025-0) $5,685,113.00 (2660801-5650/1650660-0) > Engineer's Estimate: $11,500,000.00 > City Council Approval to Advertise: March 2, 2011 P45 CITY COUNCIL AND SUCCESSOR AGENCY STAFF REPORT Re: CITY YARD EXPANSION PROJECT- NOTICE OF COMPLETION July 3, 2013 Page 2 > Publish dates for local paper: March 8, 2011 and March 15, 2011 > Bid Opening: April 26, 2011 > Contract Award Date: June 1, 2011 > Low Bidder: Oakview Constructors, Inc. of Calimesa > Contract Amount: $10,802,000.00 > Contingency: $194,436.00 (1188313-5650/1525188-0) $885,764.00 (2660801-5650/1650660-0) > Final Contract Amount: $11,455,397.00 • Difference in Contract Amount: $653,397.00 (6.05%) The net increase in the total cost of the project is a result of nine (9) Contract Change Orders (CCO). The Contract Change Orders were a mixture of changes requested by the City such as the Storm Drain Truck Dump Station and revisions to the type of metal roofing system (CCO #009), additional work required by utilities such as the SCE required revisions to the project's electrical services (CCO #004) and items that were not covered in the original contract such as the construction of an on-site storm drain diversion channel due to the delay in the construction of the Hellman Storm Drain (CCO #002), associated with the State taking of RDA funds. IRespectfully submitted, l - William Wittkopf Public Works Services Director WW/TQ:kf P46 RESOLUTION NO. 13-096 A RESOLUTION OF THE CITY COUNCIL AND THE SUCCESSOR AGENCY OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ACCEPTING THE CITY YARD EXPANSION PROJECT, CONTRACT NO. 11-068/RA11-009 AND AUTHORIZING THE FILING OF A NOTICE OF COMPLETION FOR THE WORK WHEREAS, the City Yard Expansion Project, Contract No. 11-068/RA11- 009, has been completed to the satisfaction of the Public Works Services Director; and WHEREAS, a Notice of Completion is required to be filed, certifying the work complete. NOW, THEREFORE, the City Council and the Successor Agency of the City of Rancho Cucamonga hereby resolves, that the work is hereby accepted and the Public Works Services Director is authorized to sign and file a Notice of Completion with the County Recorder of San Bernardino County. RIM CI IFINI7 Ira 1:=12 g - i it Ad igiall Sep 0 pia!ik ' G 1..,_ L � ~ O I muVn F. no r1111111 .21 . J .m ili ummilEl LT_ I;ll i C� r= =_ ri�1,,.mom u. el�Ir��11 ap%s41 y� r�`lti�? ,, iC=:��i.".:r,,, 11 Taut ic�i►o�w .E E ms"' far it '11" !`..�7_a :11 rip- rr� 441,16-i �r n •;.iJ L•I�.�411, - try".1 A ?l_ �Inl� wem!r�n„I h�` .�L�iU•;r'�-tom : 'FM 1.7.riM a_. En IIIIIVIANIr MIN.. 1 KAMM WT. c v N IL/iwin v o �:,+ten 97: 11 i i ._.. 1 Imo„ 1 I/l �ki�,. .�il� �L�iii i°GI '�\.,r gI r� 1p 1r, i' 1 li I1 miluilm el - . slig, ' '. 4, 11/Al --- ...12-topil se■-'," .1.1.-Ma Fils.,i0A.Ar7riiiiiilli Ai Eftrf.(2411-m-iiirdmil or. ,I a 9th St. Ian`r`' N�. i! � . , Project Limit ' ■.■� al. 1=1-� y E. glin,� i CITY OF RANCHO CUCAMONGA --401 Ifs CITY YARD EXPANSION PROJECT gill' 1 1 Irk,44 4r VICINITY MAP •`w N.T.S. P48 STAFF REPORT J4- PUBLIC WORKS SERVICES DEPARTMENT fit`(- ^ Date: July 3, 2013 RANCHO CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: William Wittkopf, Public Works Services Director By: Ernest Ruiz, Streets, Storm Drains, and Fleet Superintendent Keri Hinojos, CPPB, Senior Buyer Subject: AUTHORIZATION TO AWARD THE PURCHASE OF ONE (1) URBAN FORESTRY AERIAL CHIPPER TRUCK TO ALTEC INDUSTRIES, INC., OF DIXON, CALIFORNIA, IN ACCORDANCE WITH REQUEST FOR BIDS ("RFB") #13/14-001 (REPLACING UNITS #1517/10506) IN THE AMOUNT OF $126,582.60 FROM ACCT. NO. 1712001-5604 (EQUIPMENT AND VEHICLE REPLACEMENT) RECOMMENDATION It is recommended that the City Council authorize the purchase of one (1) Urban Forestry Aerial Chipper Truck to Altec Industries, Inc., of Dixon, California, in accordance with Request for Bids ("RFB") #13/14-001 (replacing units #1517/10506) in the amount of $126,582.60 from account number 1712001-5604 (Equipment and Vehicle Replacement). BACKGROUND/ANALYSIS City Council approved the purchase of one (1) Urban Forestry Aerial Chipper Truck in the adopted FY 2013/14 budget as a part of the Equipment and Vehicle Replacement Fund. The Public Works Services Department provided specifications to the Purchasing Division for the purchase of this vehicle. Purchasing prepared and posted to the City's bid system, RFB #13/14-001. Thirty-eight (38) vendors were notified; fourteen (14) vendors downloaded the RFB, and one (1) response was received. After analysis of the bid response by the Fleet Supervisor, Streets, Storm Drains and Fleet Superintendent and Purchasing Staff, it has been determined to be in the City's best interest to recommend an award to Altec Industries, Inc., of Dixon, California, for one (1) Urban Forestry Aerial Chipper Truck, as the most responsive, responsible bidder that met the specifications required by the Public Works Services Department. All applicable bid documentation is on file in the Purchasing Department and can be downloaded from the City's Bid system. Respectfully -ubmitte•, ...1 Wittkopf :•w William Wittkopf Public Works Services Director WW/ER:kh P49 STAFF REPORT k , Lt J RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Robert Karatsu, Library Director Subject: APPROVAL TO ACCEPT AND TO ALLOCATE $1,000 GRANT AWARDED BY DOLLAR GENERAL INTO LIBRARY REVENUE ACCOUNT 1290000-4740/0- 3736 AND APPROPRIATE $1,000 INTO EXPENDITURE ACCOUNT 1290606- 5200/0-3736 FOR DOLLAR GENERAL "BACK 2 BASICS GRANT." RECOMMENDATION Staff recommends that the City Council accept and allocate $1,000 received from Dollar General into Library revenue account 1290000-4740/0-3736 and appropriate $1,000 into expenditure account 1290606-5200/0-3736 for Dollar General "Back 2 Basics Grant." BACKGROUND/ANALYSIS In May 2013, Library staff successfully applied for a grant from Dollar General. Funds from this grant will be used to purchase materials for the Back 2 Basics after school tutoring program, a program that is designed to help school-age children who are reading below their grade level to improve their reading and comprehension skills. FISCAL IMPACT No net impact on the Library Fund or General Fund as the grant does not have any City matching requirements and fully funds the items listed above. Respectfully submitted,- ,� . Robert Karatsu Library Director C;� P50 STAFF REPORT J RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Robert Karatsu, Library Director Subject: APPROVAL TO ALLOCATE $85,000 AWARDED BY THE CALIFORNIA STATE LIBRARY INTO LIBRARY REVENUE ACCOUNT 1291000-4740/0-3737 AND APPROPRIATE $4,000 INTO EXPENDITURE ACCOUNT 1291602-5010/0- 3737, $1,000 INTO EXPENDITURE ACCOUNT 1291602-5030/0-3737, $25,000 INTO EXPENDITURE ACCOUNT 1291602-5200/0-3737 AND $55,000 INTO EXPENDITURE ACCOUNT 1291602-5300/0-3737, FOR "POP UP RC" PROJECT. RECOMMENDATION Staff recommends that the City Council approve and allocate $85,000 received from the State Library "Pop Up RC" Project Grant into Library revenue account 1291000-4740/0- 3737 and appropriate into Library expenditure accounts in the following manner: 1291602-5010/0-3737 Part Time Salaries $ 4,000 1291602-5030/0-3737 Fringe Benefits $ 1,000 1291602-5200/0-3737 Operations and Maintenance $ 25,000 1291602-5300/0-3737 Contract Services $ 55,000 BACKGROUND/ANALYSIS In June of 2013, the Library successfully applied for a competitive grant from the California State Library entitled "Pop Up RC." This grant, funded by the California State Library, is envisioned as a way to provide mobile City services to the residents of Rancho Cucamonga. The City already provides a service like this with the Library's Bookmobile. This grant will allow the City to take this mobile service concept to a different level. In addition to having books, computers, and story times, this grant will allow for the repurposing of an existing City trailer that will also offer such City services such as sidewalk CPR classes, recreation programs, being a wifi hotspot, environmental programs, pet micro chipping and much more. P51 APPROVAL TO ALLOCATE $85,000 AWARDED BY THE CALIFORNIA STATE LIBRARY INTO PAGE 2 LIBRARY REVENUE ACCOUNT 1291000-4740/0-3737 AND APPROPRIATE $4,000 INTO EXPENDITURE ACCOUNT 1291602-5010/0-3737, $1,000 INTO EXPENDITURE ACCOUNT 1291602-5030/0-3737, $25,000 INTO EXPENDITURE ACCOUNT 1291602-5200/0-3737 AND $55,000 INTO EXPENDITURE ACCOUNT 1291602-5300/0-3737, FOR"POP UP RC" PROJECT. JULY 3, 2013 In partnership with the City Manager's Office, Community Services, Fire District, Animal Center, Police Department, Community Development, Administrative Services and the Library will work with all City departments to create a "pop up" plan of service and then get this new service implemented and on the road by February, 2014. Respectfully submitted, Robert Karatsu Library Director P52 :- STAFF REPORT h t CONI\IUNITY SERVICES DEPARTMENT L J RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Nettie Nielsen, Community Services Director By: Karen McGuire-Emery, Senior Park Planner Shelley Hayes, Assistant Engineer Subject: RELEASE OF MAINTENANCE GUARANTEE BOND NO. 71245393-M IN THE AMOUNT OF $5,159.00, FOR THE VICTORIA GARDENS CULTURAL CENTER LED SIGN PROJECT, CONTRACT NO. 12-017 RECOMMENDATION It is recommended that the City Council authorize the City Clerk to release the Maintenance Guarantee Bond No. 71245393-M in the amount of $5,159.00, for the Victoria Gardens Cultural Center LED Sign Project, Contract No. 12-017. BACKGROUND/ANALYSIS The required one-year maintenance period has ended and the improvements remain free from defects in materials and workmanship. Contractor: Fortex Construction Inc. 231 E. Imperial Hwy., Ste. 250 Fullerton, CA 92835 • Respectfully submitted, Nettie Nielsen Community Services Director I�GTO ,o 44'7.f Ier ¼ \hI NDRs� � 'ARK 3� .� \i .4 F� VICTORIA i �'���� �� �` Lwnrroor .15p/ t..., E/EMEIRARY sc io 9NTAGE �� .�,��� PARK �J 1".in —111. .ww. rwr. J ELLEN O O� I ill_ `/ PARK 0 r 0IS id _ (� `7T _' 7 r �� `' BASE LINE RI • • ._S----c'-'E-5'•-..../\\q 'a i� TERRA �PB J CT LOCATION VISTA ELEMENTARY v_.) J Z SCHOOL MI )� W r# MTN VIE is PARK J J 1r JA1,714EN R J PARK ^ _ — V—_._. ' VICTORIA aY — `i J J GARDENS CULTURAL / W I Z CO CENTER =211e lit Z Y . NV Q W I W El 0 CC VICTORIA �„�+►:4^ ' ›— GARDENS I c W Q fir, _—____--ni --111 VICTORIA us e% Q 0 6 6 4,_,_V.: • 4 A i 9 I' 1 D A UL T � SPORTS COMPLE _ CITY OF RANCHO CUCAMONGA *{4I,4,r�. VICTORIA GARDENS Iiirr �l►'� CULTURAL CENTER 1111110 - P54 STAFF REPORT Sit ADMINISTRATIVE SERVICES GROUP L s�- RANCHO CUCAMONGA Date: July 3, 2013 To: Mayor and Members of the City Council John R. Gillison, City Manager From: Lori E. Sassoon, Deputy City Manager/Administrative Services By: Ingrid Y. Bruce, GIS/Special Districts Manager Subject: CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMENTS, PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN STREET LIGHTING MAINTENANCE DISTRICT NO. 1 THROUGH 8, INCLUSIVE, FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC HEARING THEREON. NO INCREASE OF ASSESSMENT RATES IS PROPOSED OR PERMITTED. RECOMMENDATION: It is recommended that the City Council approve the Resolutions initiating the proceedings to levy annual assessments, preliminarily approve the Annual Engineer's Reports, declaring the City Council's intention to levy annual assessments within Street Lighting Maintenance District No. 1, 2, 3, 4, 5, 6, 7 and 8. There is no increase, proposed or permitted, to the current rates in these districts for Fiscal Year 2013/2014. The Engineer's Reports are also on file in the City Clerk's Office. BACKGROUND/ANALYSIS: The City of Rancho Cucamonga has eight (8) Street Lighting Maintenance Districts that provide street light coverage throughout the general city and planned communities. Each year the assessments received are earmarked for the maintenance and operation of street lights, traffic signals and appurtenant facilities. This maintenance and operation includes the cost and supervision of street lighting maintenance, including repair, removal or replacement of all or any part of any improvement providing for illumination of the subject area in connection with said Districts. The City utilizes prior year carryovers along with current year assessment revenues, supplemented with limited amounts of restricted Gas Tax revenues in some cases, to meet the districts' annual expenses. When the SLDs were established, they were in conjunction with the new development coming into the City, and were intentionally designed to ensure that each district bore the costs of the maintenance of the infrastructure that provides special benefit to the property owners. It has been over 16 years since there was an assessment increase in the SLDs, and certain districts will soon require an assessment increase in order to remain financially self-sustaining while continuing to provide a high level of maintenance. No rate increase, however, can occur unless the City Council P55 CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF PAGE 2 THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMEN 1S,PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CPl'Y COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN STREET LIGHTING MAINTENANCE DISTRICT NO. 1 THROUGH 8,INCLUSIVE, FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC 1-TEARING TI-HEREON. NO INCREASE OF ASSESSMENT RATE IS PROPOSED. JULY 3,2013 authorizes a Proposition 218 assessment ballot process to give the property owners the opportunity to express their support for, or opposition to, an increase in such assessment. Staff has been working on plans to bring these issues before the City Council and the community, for a more detailed discussion and direction, sometime during the first two quarters of the upcoming fiscal year. As stated in the Street Lighting Maintenance Districts Fiscal Year 2013/2014 Engineer's Reports, the assessment rates shall remain unchanged from the previous FY 2012/2013 rates. The assessment rate and district description for each Street Lighting Maintenance District is as follows: Street Lighting Maintenance District No. 1 assessments pay for energy and maintenance for streetlights on arterial streets. The current assessment rate is $17.77 per single-family residence. The commercial rate is $35.54 per acre. This district will require a rate increase in future years to maintain service levels. Street Lighting Maintenance District No. 2 assessments pay for energy and maintenance for streetlights on residential streets. The current assessment rate is $39.97 per single-family residence. The commercial rate is $79.94 per acre. This district will require a rate increase in future years to maintain service levels. Street Lighting Maintenance District No. 3 assessments pay for energy and maintenance for streetlights within the Victoria Planned Community. The current assessment rate is $47.15 per single-family residence. The commercial rate is $94.30 per acre. Street Lighting Maintenance District No. 4 assessments pay for energy and maintenance for streetlights within the Terra Vista Planned Community. The current assessment rate is $28.96 per single-family residence, the multi-family rate is $14.48 per dwelling unit and the commercial rate is $57.92 per acre. This district will require a rate increase in future years to maintain service levels. Street Lighting Maintenance District No. 5 assessments pay for energy and maintenance for streetlights within the Caryn Planned Community. The current assessment rate is $34.60 per single-family residence. This district will require a rate increase in future years to maintain service levels. It is noted that reserves for SLD 5 will be completely depleted at the end of FY13/14. Staff anticipates that SLD 5 will be addressed as an urgent matter in conjunction with PD-85 and other similarly situated districts. Street Lighting Maintenance District No. 6 assessments pay for energy and maintenance for streetlights within the commercial and industrial area of the City. The current assessment rate is $51.40 per acre for commercial property. Street Lighting Maintenance District No. 7 assessments pay for energy and maintenance for streetlights within the Etiwanda Highlands Community. The current assessment rate is $33.32 per single-family residence. This district is operating at a significant deficit and is being funded with Gas Tax funds to provide services. This district will require a rate increase in future years to maintain service levels. Street Lighting Maintenance District No. 8 assessments pay for energy and maintenance for streetlights in South Etiwanda. The current assessment rate is $30.60 per single-family residence. P56 CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF PAGE 3 THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS LEVY ANNUAL ASSESSMENTS,PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CITY COUNCIL'S IN 1 ENTION TO LEVY ANNUAL ASSESSMENTS WITHIN STREET LIGHTING MAINTENANCE DISTRICT NO. 1 THROUGH 8,INCLUSIVE, FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC HEARING THEREON. NO INCREASE OF ASSESSMENT RATE IS PROPOSED. Juix3,2013 Attachments Resolutions Engineer's Reports P57 RESOLUTION NO. 13-097 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORTS PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN STREET LIGHTING MAINTENANCE DISTRICT NO. 1, 2, 3, 4, 5, 6, 7 AND 8, INCLUSIVE, FOR FISCAL YEAR 2013/14 WHEREAS, the City Council of the City of Rancho Cucamonga, California, previously undertaken proceedings to form and has formed certain maintenance districts pursuant to pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act"), known and designated as Street Lighting Maintenance District No. 1, 2, 3, 4, 5, 6, 7 and'8, inclusive (each, a "District" and collectively, the "Districts"); and WHEREAS, at this time the City Council desires to initiate proceedings pursuant to Chapter 3 of the 1972 Act to provide for the annual levy of assessments for the next ensuing fiscal year to provide for the annual costs for maintenance and servicing of improvements within the Districts; and WHEREAS, the proceedings for the annual levy of assessments shall relate to the fiscal year commencing July 1, 2013, and ending June 30, 2014 ("Fiscal Year 2013/14"). NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. New Improvements or Substantial Changes in Existing Improvements. No new improvements are proposed to be added to the improvements to be maintained and serviced and no substantial changes in the existing improvements are proposed to be made for Fiscal Year 2013/14. SECTION 3. Annual Engineer's Reports. The City Engineer is hereby ordered to prepare and file with this City Council an Annual Engineer's Report for each District relating to such annual assessment and levy in such District in accordance with the provisions of Article 3 of Chapter 1 of the 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"). SECTION 4. Filing of the Annual Engineer's Reports. Upon completion, the Annual Engineer's Report for each District shall be filed with the City Clerk, who shall then submit the same to this City Council for its consideration pursuant to the Assessment Law. P58 PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk • P59 RESOLUTION NO. 13-098 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORTS FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN STREET LIGHTING MAINTENANCE DISTRICT NO. 1, 2, 3, 4, 5, 6, 7 AND 8, INCLUSIVE, FOR FISCAL YEAR 2013/14 WHEREAS, the City Council of the City of Rancho Cucamonga, California, pursuant to the provisions of Division 15, Part 2 of the Streets and Highways Code of the State of California (the "1972 Act"), Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), did, by previous Resolution, order the preparation of a separate report for the annual levy of assessments for Fiscal Year 2013/2014 (each, an "Annual Engineer's Report") in certain maintenance assessment districts known and designated as Street Lighting Maintenance District No. 1, 2, 3, 4, 5, 6, 7 and 8, inclusive (each, a "District" and collectively, the "Districts"); and WHEREAS, there has now been presented to this City Council a separate Annual Engineer's Report for each District as required by the Assessment Law and as previously directed by Resolution; and WHEREAS, this City Council has now examined and reviewed each Annual Engineer's Report as presented, and is satisfied with each and all of the items and documents as set forth in each report, and is satisfied that the assessments on a preliminary basis, have been spread within each District in accordance with the special benefits received from the improvements to be maintained and serviced, as set forth in the applicable Annual Engineer's Report. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Annual Engineer's Reports. The Annual Engineer's Report for each District as presented, consisting of the following: A. Plans and specifications describing the general nature, location and extent of the improvements to be maintained and serviced and the extent of such maintenance; B. An estimate of the cost of the maintenance of the improvements for the District for Fiscal Year 2013/14; C. A diagram for such District, showing the area and properties proposed to be assessed; and P60 D. . An annual assessment for Fiscal Year 2013/2014 of the estimated costs of the maintenance and servicing of those improvements to be maintained and serviced during such Fiscal Year, assessing the net amount upon all assessable lots and/or parcels within such District in proportion to the special benefits received is hereby approved on a preliminary basis and is ordered to be filed in the Office of the City Clerk as a permanent record and to remain open to public inspection. SECTION 3. The City Clerk shall certify to the passage and adoption of this Resolution, and the minutes of this meeting shall so reflect the presentation of the Annual Engineer's Reports. PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P61 RESOLUTION NO. 13-099 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2013/2014 IN STREET LIGHTING MAINTENANCE DISTRICT NO. 1, 2, 3, 4, 5, 6, 7 AND 8, INCLUSIVE, AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed certain maintenance districts and authorized the levy of assessments therein pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972," being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act") in what are known and designated as Street Lighting Maintenance District No. 1, 2, 3, 4, 5, 6, 7 and 8, inclusive (each a "District" and collectively, the "Districts"); and WHEREAS, this City Council has initiated proceedings to provide for the annual levy of assessments for Fiscal Year 2013/14, to finance the costs and expenses necessary for continued maintenance and servicing of improvements within each District; and WHEREAS, at this time, there has been presented and approved by this City Council, a separate report for each District identified by the distinctive designation of such District and entitled "Fiscal Year 2013/14 Annual Engineer's Report" (each, an "Annual Engineer's Report" and collectively, the "Annual Engineer's Reports") as required pursuant to Article 4 of Chapter 1 of the 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), and this City Council desires to conduct the proceedings to authorize the levy of the annual assessments within each District; and WHEREAS, the annual assessments for Fiscal Year 2013/14 proposed to be levied within each District as set forth in the applicable Annual Levy Report do not exceed the annual assessments as previously authorized to be levied within such District and, therefore, the proposed levy of assessments for Fiscal Year 2013/2014 within such District are not deemed to be "increased" over the maximum authorized annual assessments. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Improvements and Maintenance and Servicing Thereof. The public interest and convenience requires, and it is the intention of this City Council, to undertake proceedings for the annual levy and collection of assessments within each District for the continual maintenance and servicing of the improvements authorized to be maintained and serviced within each such District. P62 The improvements include, but are not limited to, street lights, traffic signals and appurtenant facilities related thereto. A description of the specific improvements to be maintained and serviced within each District is set forth in Appendix A attached hereto and incorporated herein by this reference. The maintenance of the improvements includes the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement. Service includes the furnishing of electric current or energy, gas, or other illuminating agent for any improvement. Reference is made to the applicable Annual Engineer's Report for further information regarding the improvements to be maintained and serviced for each District and the scope of such maintenance and service. SECTION 3. Annual Engineer's Reports. The Annual Engineer's Reports regarding the annual levy for each District for Fiscal Year 2013/2014 have been preliminarily approved and directed to be filed in the Office the City Clerk. Reference is made to the applicable such report for each District for a full and detailed description of the improvements to be maintained and serviced, the boundaries of such District and any zones therein, and the proposed assessments upon assessable lots and parcels of land within such District. SECTION 4. Assessment. The public interest and convenience requires, and it is the intention of this City Council to order the annual levy of assessments for each District as set forth and described in the applicable Annual Engineer's Report, and further it is determined to be in the best public interest and convenience to levy and collect annual assessments to pay the costs and expenses of such maintenance and service as estimated in such Annual Engineer's Report. SECTION 5. Boundaries of Districts. The proposed maintenance and service work as described in the Annual Engineer's Report for each District is, in the opinion of this City Council, of special benefit to the properties within the boundaries of such District, and this City Council makes the costs and expenses of such maintenance and service chargeable upon each such District, which District said City Council hereby declares to be the District specially benefited by such maintenance and service, and to be further assessed pursuant to the Assessment Law to pay the costs and expenses thereof. Each such District shall include each and every parcel of land within the boundaries thereof; as such District is shown on a map or maps as approved by this City Council and on file in the Office of the City Clerk, and so designated by the name of such District. SECTION 6. Public Hearing. Notice is hereby given that a public hearing will be held the 17th day of July, 2013 at the hour of 7:00 o'clock p.m. or as soon thereafter as the matter may be heard, in the regular meeting of the City Council, being in the Council Chambers located at 10500 Civic Center Drive, Rancho Cucamonga, California, which is the time and place fixed by this City Council for the hearing of protests or objections in reference to the annual levy of assessments, to the extent of the maintenance, by any interested person and any other matters contained in this resolution. Any persons who wish to object to the proceedings for the annual levy should file a written protest with the City Clerk prior to the time set and scheduled for said public hearing. P63 SECTION 7. For Information Regarding Proceedings. For any and all information relating to the proceedings, protest procedure, any documentation and/or information of a procedural or technical nature, your attention is directed to the below listed person at the City: Ingrid Bruce GIS/Special Districts Manager City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, CA 91730 (909) 477-2700, Ext 2575 SECTION 8. Notice. The City Clerk is hereby authorized and directed to publish, pursuant to Government Code Section 6061, a copy of this Resolution in the Inland Valley Daily Bulletin, a newspaper of general circulation within said City, said publication shall be made one time and not less than ten (10) days before the date set for the Public Hearing. PASSED, APPROVED AND ADOPTED this day of July, 2013 AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P64 APPENDIX A DESCRIPTION OF IMPROVEMENTS This Appendix A contains general descriptions of the improvements to be maintained and serviced within each of the Districts. Please refer to the Annual Levy Reports for a full and complete description of the maintenance and service to be provided for each District. Street Lighting Maintenance District No. 1 The installation/maintenance of street lights and traffic signals on arterial streets that are throughout the City. Street Lighting Maintenance District No. 2 The installation/maintenance of street lights and traffic signals on local streets that are generally west of Haven Avenue. Street Lighting Maintenance District No. 3 The installation/maintenance of street lights and traffic signals located within the Victoria Planned Community. Street Lighting Maintenance District No. 4 The installation/maintenance of street lights and traffic signals located within the Terra Vista Planned Community. Street Lighting Maintenance District No. 5 The installation/maintenance of street lights and traffic signals located within the Caryn Planned Community. Street Lighting Maintenance District No. 6 The installation/maintenance of street lights and traffic signals located on commercial and industrial streets throughout the City but that are not within an existing local maintenance district. This area is located generally south of Foothill Boulevard. Street Lighting Maintenance District No. 7 The installation/maintenance of street lights and traffic signals on local streets within this area of the City is known as "North Etiwanda". This area is located generally east of Day Creek Channel and north of Highland Avenue. Street Lighting Maintenance District No. 8 The installation/maintenance of street lights and traffic signals on local streets within this area of the City is known as "South Etiwanda". This area is located generally east of Etiwanda Avenue, north of Foothill Boulevard and south of Highland Avenue. P65 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 1 (Arterial) P66 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 1 (ARTERIAL) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P67 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P68 ENGINEER'S LETTER WHEREAS, on July 3, 2013 the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Lighting Maintenance District No. 1 (Arterial) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 787,000.00 Less Anticipated Delinquencies (8,060.00) Total Estimated Revenue $ 778,940.00 Plus Reserve Fund Contribution 73.180.00 Total Expenditure Budget $ 852,120.00 Total District EBU Count 44,288.36 Actual Assessment per EBU $ 17.77 Maximum Allowable Assessment per EBU $ 17.77 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P69 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P70 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P71 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P72 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as the entire City of Rancho Cucamonga. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P73 b1/£TOZJIeame3sid 9 auoweonD opueb 4o ATIJ— t •oN 13IJisIc aJueualuIew 51-1il1]5i1 laaalS Z • < iv' J y O c U ` C to U w W al AV AHM3HJ 9 1 a Q1 •I Z J 0 ) . J i' .,. m _. iih„„,,,c.,, = 1 `s .z y, y 75F3 W Z N o 2 1.or vs i I 1 Q 0 w+.p,e u3 Q Z � �nV VaKbMJl 'J 'AV VC1NVMi13 � r'�•F"'3 3 fn E lfl J13383 lVa ,,e ,„ V C AV a31S3H3oa II 1111111 .CD O4 i Sd,{J OZf r W Q u„,„,eI c 47 O AV N3NI11IW it C o 11%1* w CO• a ,.- c o•C dLV. _ ...0 ...-.. ,t, , 0 A uaAeH Ad��3AYH a^„H O Tri CA J S CC esou„a w J CD V H *0 m ,ow,aH t7) II AV VSOYV2l3H ima gi J o x J CO y rgFgn�,� I Z o Ole 9�4�M CO LL D LL NAV d lV81H-, �, w _ I < v x AV VIYll3H k ”" uewlaH<"/U"-41'.F1 Z 1S 10199.1, j m rs uuiawe0 41111114-0 CC O Iii i M M $l�g Y$ 9� 5 R' 3� I G V.AO,� 31lb$isls5g 4sbz gg a bbL: `t b b 9 Y L e 2' C G S a L M m ` r� l'atr�$gtEdd,a _, S = 1111!Yi9r8�3,s$i� ...... oc� z a a again _ae ra P74 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget • Estimated 2013/14 Budget Personnel Services Regular Payroll $ 13,170.00 Part-time Salaries 0.00 Fringe Benefits 6.190.00 Subtotal Personnel $ 19,360.00 Operations and Maintenance Training $ 180.00 Membership Dues 4,030.00 Operations and Maintenance 4,940.00 Equip Operations & Maintenance 500.00 Contract Services 0.00 Utilities Telephone Utilities 1,030.00 Electric Utilities 628,470.00 Assessment Administration 160,190.00 General Overhead 33,420.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 832,760.00 Capital Expenditures Capital Proiects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 852,120.00 Total Estimated Assessment $ 787,000.00 Less Anticipated Delinquencies (8,060.00) Total Estimated Revenue $ 778,940.00 • Plus Operating Reserve Fund Contribution 73,180.00 Total Expenditure Budget $ 852,120.00 Total Estimated Assessment $ 787,000.00 Total District EBU Count 44,288.36 Actual Assessment per EBU — Fiscal Year 2013/14 $ 17.77 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 17.77 *Includes rounding as each parcel's annual assessment must be rounded down to the nearest even cent for County tax roll purposes. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P75 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 1,081,890.00 Operating Reserve Contribution — Fiscal Year 2013/14 (73,180.00) Operating Reserve Collection — Fiscal Year 2013/14 L00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 1,008,710.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA dues. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Telephones: This item includes the costs for master controllers for dial-in data lines for uploading, downloading and observing system operations for traffic signals. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P76 Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P77 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P78 • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1984, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 19.96/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P79 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Benefit Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Parcel Multi-Family Residential 1.00 Unit Non Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $17.77 $17.77 27,785.00 27,785.00 Multi-Family Residential 17.77 17.77 10,313.00 10,313.00 Non Residential 17.77 17.77 3,095.18 6,190.36 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P80 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No. 1—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bL/£IOZ JeaA IeDs!J P81 eSuoweon o oue Jo�l I —O a }O I 'ON ��J�si a�ueua�uie �ui� �i �aaJ� 4 � .0 W . u .l 5 Y•+ in (.) *or E .` ` J o O Q w J 5 ' Ay AJJay3 (..) : lI a31 ?It AI a, N o co o 0 C ^y lSe3 = L` ny epuenn!j3 Cri .1.r Q} lad AV J91s01.40O6 Ay Japa oo 4 my uamIiW ny uajill!w ny uaneN ny uaneH Ay esowJeH ° AV esoWJaH Ay Pleq!uoJy AV Pleq!40JV Ay uewllaH — Ay uewllaH co !-c .c if nv pJenau!n IS ue!lawe3 } tslL• gCL1 ct ti l iri3Ay 0A0.10 d ad c m E _ !pi J = t o 2 cO S it � a _ T Q o Q - Pip s C c m t £• i_21- 0 m En iD p Y I; gL 2•' •� i } i � pi a#. ; a P82 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $17.77 27,785.00 27,785.00 $493,739.45 Multi-Family Residential 17.77 10,313.00 10,313.00 183,262.01 Non Residential 17.77 3,095.18 6,190.36 110,002.70 TOTALS 41,154.38 44,212.76 $787,004.16 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexations are effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code) 0227-131-03 1/18/2012 TR 18806 33.00 33.00 Single-Family Residential 0207-022-56 3/07/12 DRC2011- 1.00 1.00 Single-Family Residential 00645 • 0225-161-65 & 4/18/12 TR 18096 32.00 32.00 Single-Family Residential 71 Single-Family 0210-062-08 5/16/12 TR 18804 65.00 65.00 Residential/Multi-Family Residential 0225-011-37 11/07/12 PM 19043 2.00 2.00 Single-Family Residential • 0226-081-17 11/21/12 PM 19367 2.00 2.00 Single-Family Residential • Street lighting Maintenance District No. 1—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P83 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 2 (Local Streets) P84 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 2 (LOCAL STREETS) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P85 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P86 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 2 (Local Streets) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 351,350.00 Less Anticipated Delinquencies (7,930.00) Total Estimated Revenue $ 343,420.00 Less Reserve Fund Collection (22,490.00) Total Expenditure Budget $ 320,930.00 Total District EBU Count 8,790.32 Actual Assessment per EBU $ 39.97 Maximum Allowable Assessment per EBU $ 39.97 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P87 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. . In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P88 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P89 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the.District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P90 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as the entire City west of Haven Avenue. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 5 Fiscal Year 2013/14 VT/ETOZ-wail lepsj P91 9 e2uoweonj otpuea Jo Allj—Z 'oN ppilsla auueualulew 8ullgTl- laa)1$ Zy rn Z < o = m • L N as 4� w 0 w 0) 0) 0 CO I . it_ _......."......1 'NAL I . 0 I I / -'—i I IT 'rs` g m r�il. � II �� : v7 _ 3 +�+ {T_ ' i�� �� LL V 19¢3 N EI nvasv3 G at M epoewy I Onot s'. ' I .• --X4:9, a t it Z AV -•1 I , y�s w Av vanniMIL9 /,\ _ ...pue a N V 0 I c � L��' ��°�� a 91 qev en y �� \}�� LV °Laves 1 1 :ma � ���� 0 • Q` y ° • Cmg 19:N33N�,AdO 111 `' ti 2 N _ r r tcU. __• A �� fr ,',_ a c_ ■ )Q -_' h •V rgeaYaa. �' li - - �:i:;:iL - ��" 911 U C ' - 1 x°'1'1 a EuL_ :nv a3is3HOOri if= Q) I WI h� AV. .1•• . off ' •�_ 319:4308 )a k u wJ1�, it. . .2 V -_. _ 4 LLQIL y' [ °j Mal ' --a ua;gpW . Z -O (nv Narvivi ®I p ,i w2J1`.w+ ). jig O(� ,v:i:L: 'CMG ^ �� uane 0 J L eao4waH iW I 1 _ _ I *iCO _s Ok4 �.AV.VSOW 3H is . A :..m 4; - -ow+aH Ncu Mp19.4 : lath g' -e �� ro ESE' " E' AV ON91HOLIV, __ ¢ga0y N• .. Cu It v i9 131nv r"Niel.5 _ - _ = ,ry ueugaH • I jys:to E .1-.',". -.r-.1rf AVN.VW.l1l3H (VueWlaH -llsl'r�a3l a, t4 — = s Yt I I a I vv A _# c• is NtlIl3NUV0 „.,,,j !`� :• „, , :i Of m Pi q rpm;I e • t _ - yli 7!diII_S 1111!` m m yaen49 ?'fig Hd Fay a�•• •e $ 3 y aue.i.l'- iAidlila ap 4 al so lIllIIilluIh,_� u8 Sb ?99t55ie8ah:6 P92 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 0.00 Part-time Salaries 0.00 Fringe Benefits 0.00 Subtotal Personnel $ 0.00 Operations and Maintenance Training $ 0.00 Membership Dues 0.00 Operations and Maintenance 0.00 Equip Operations & Maintenance 0.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 280,870.00 Assessment Administration 37,110.00 General Overhead 2,950.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 320,930.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 320,930.00 Total Estimated Assessment $ 351,350.00 Less Anticipated Delinquencies (7,930.00) Total Estimated Revenue $ 343,420.00 Less Operating Reserve Fund Contribution (22,490.00) Total Expenditure Budget $ 320,930.00 Total Estimated Assessment $ 351,350.00 Total District EBU Count 8,790.32 Actual Assessment per EBU — Fiscal Year 2013/14 $ 39.97 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 39.97 Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P93 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 50,040.00 Operating Reserve Contribution — Fiscal Year 2013/14 0.00 Operating Reserve Collection — Fiscal Year 2013/14 22,490.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 72,530.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA dues. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Telephones: This item includes the costs for master controllers for dial-in data lines for uploading, downloading and observing system operations for traffic signals. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P94 Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's admihistrative structure. Capital Expenditures: Capital Proiects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P95 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P96 • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1983, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 19.96/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P97 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Parcel Multi-Family Residential 1.00 Unit Non Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $39.97 $39.97 6,721.00 6,721.00 Multi-Family Residential 39.97 39.97 1,989.00 1,989.00 Non Residential 39.97 39.97 40.16 80.32 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P98 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bT/£TOZ yea,, Ieps!U P99 VI eBuoweDn0 oyouea 40 AID— Z •0N P3!a1s!a aDueualu!eW 2ully2!1 laaJTS N w CU co a -- lad E �" N .� s` 0 `J Cli Q ji i o 1. 1 ny ti�aya 0 c1. .._.._.. ! .., -a _./ ,.r O in li Fa ii o CD 1 ,r a) = I m o 0 ny Ise3 in `fir I v L IC i ny epueMijj ny epuenniig .a) ! lr i i9 leaio Aea Jalsayooa ! n Ja;sa o0 V) i y y i� i + ny ua)I!II!W r—.._.._.._.._._ ny L18)I!II!W Ay uaneH ny uaneH ny esowJaH ((J ny esowieH AV Pleq! °Jy' ny Pleq!yoiy ny uewpaH — ny uewllaH to (r) r s v ny p eAau !/\ IS ue!fauwea v td!{ti; int cc AV 8A0.10 s P€ � 1�� S co lI41 1D C Cn CO m lW4;� 1112 P100 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $39.97 6,721.00 6,721.00 $268,638.37 Multi-Family Residential 39.97 1,989.00 1,989.00 79,500.33 Non Residential 39.97 40.16 80.32 3,210.39 TOTALS 8,750.16 - 8,790.32 , $351,349.09 "'Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU".. A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexations are effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code) 0207-022-56 03/07/12 DRC2011- 1.00 1.00 Single-Family 00645 Residential 0210-062-08 05/16/12 TR 18804 65.00 65.00 Single-Family/Multi- Family Residential Street Lighting Maintenance District No. 2—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P101 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 3 (Victoria Planned Community) P102 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 3 (VICTORIA PLANNED COMMUNITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P103 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 6 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 8 District Budget Definitions of Budget Items Method of Assessment 11 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 14 Assessment Roll 16 Assessment Roll Annexations P1O4 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 3 (Victoria Planned Community) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 350,020.00 Plus Anticipated Delinquencies 1,810.00 Total Estimated Revenue $ 351,830.00 Less Reserve Fund Collection (39,800.00) Total Expenditure Budget $ 312,030.00 Total District EBU Count 7,434.16 Actual Assessment per EBU $ 47.15 Maximum Allowable Assessment per EBU $ 47.15 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P105 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P106 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P107 If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P108 If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P109 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga. The boundaries of the District are generally described as that area located south of the 1-210 Freeway, west of Etiwanda Avenue, southwest of the 1-15 Freeway and east of Haven Avenue, also known as the Victoria Planned Community, and are more particularly in the diagram of the District included herein. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. 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Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 13,170.00 Part-time Salaries 0.00 Fringe Benefits 6.190.00 Subtotal Personnel $ 19,360.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 11,440.00 Equip Operations & Maintenance 0.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 240,770.00 Assessment Administration 35,360.00 General Overhead 4,890.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 292,670.00 Capital Expenditures Capital Proiects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 312,030.00 Total Estimated Assessment $ 350,520.00 Plus Anticipated Delinquencies 1,810.00 Total Estimated Revenue $ 351,830.00 Less Operating Reserve Fund Collection (39,800.00) Total Expenditure Budget $ 312,030.00 Total Estimated Assessment $ 350,520.00 Total District EBU Count 7,434.16 Actual Assessment per EBU — Fiscal Year 2013/14 $ 47.15 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 47.15 Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P112 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 1,123,610.00 Operating Reserve Contribution — Fiscal Year 2013/14 (0.00) Operating Reserve Collection — Fiscal Year 2013/14 39.800.00 Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 1,163,410.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA Certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Telephones: This item includes the costs for master controllers for dial-in data lines for uploading, downloading and observing system operations for traffic signals. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P113 Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P114 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) (of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P115 • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1982, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Dwelling Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P116 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Parcel Multi-Family Residential 1.00 Unit Non Residential 2.00 Acre The use of the latest County Assessors Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $47.15 $47.15 6,346.00 6,346.00 Multi-Family Residential 47.15 47.15 589.00 589.00 Non Residential 47.15 47.15 249.58 499.16 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P117 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 14 Fiscal Year 2013/14 vi/Eioz I P118 Jea A ens!J ST e?uouweanj otpuei 40 A1!0-E oN PIJTs!Q aDueualu!ew 2u!lytl1 laaJ1S Mco I 'i ,= >'• J (• J c U c) 11111r) 0 I 5 �4 Ay /Jain ci-i ` cc CV 1,7'i j r 3 1 Av Ise3 in w I F i L-_-_ C Mll3 i iq I C 18 maaio Aea � �_...-.ny Jalsayao8..'� I i i I, ny Jelsayooel I I AV ua)llllllN f._..—.._.._--- I Ay ua>!!II! J i i i i i tt i Ay uaneH I a i I iAy uaAeH i iI i AV esowJa I I te I ny esouJJOH I i AV Pleq!yoJy1' I I Ay pleciapty t i Ay uew aH I Ay ueuJllaH I L v I I e Ay pJ I Aau!n IS uellauJe3 I i ! .400 ji.,..-"""1— I 111111;fril _ Ay aAOJ0 it!iHthuil S -6 ,- lilliillill as ill 1!:114 u) QS ;1111 4 e ia 1 = rn3j #i � ; eis.21!Sit it I:60. 11 t j!,i l fl P119 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $47.15 6,346.00 6,346.00 $299,213.90 Multi-Family Residential 47.15 589.00 589.00 _ 27,771.35 Non Residential 47.15 249.58 499.16 23,535.40 TOTALS 7,179.25 7,435.50 $350,520.65 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Street Lighting Maintenance District No. 3—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P120 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 4 (Terra Vista Planned Community) P121 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 4 (TERRA VISTA PLANNED COMMUNITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P122 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P123 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 4 (Terra Vista Planned Community) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 159,510.00 Plus Anticipated Delinquencies 1,060.00 Total Estimated Revenue $ 160,570.00 Plus Reserve Fund Contribution 4,580.00 Total Expenditure Budget $ 165,150.00 Total District EBU Count 5,508.06 Actual Assessment per EBU $ 28.96 Maximum Allowable Assessment per EBU $ 28.96 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 4—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P124 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer • Street Lighting Maintenance District No.4—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P125 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the repair, removal or replacement of all or any part of any improvement. Servicing means the furnishing of services and materials for the ordinary and usual maintenance, operating and servicing of any improvement. Servicing shall also include vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the Street Lighting Maintenance District No.4—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P126 matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No.4—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P127 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City known as the Terra Vista Planned Community, which is located north of Foothill Boulevard, west of Rochester Avenue, east of Haven Avenue, south of Base Line Road and includes the northeast corner of Base Line Road and Haven Avenue. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No.4—City of Rancho Cucamonga 5 Fiscal Year 2013/14 I VVETOZ JeaA peDsi j P128 9 auowean0 oyauej Jo Ali0—b ON Paialsia aJueualuIew Sum 2n oa.r;s d� --1 1 1 - 1 1 1 1 1 1 Pr -.4 -1-1C.... 1 •s 2t‘3 • • d 2i31S3H302! ROC■- C p •0115 iin Aii II- m D r cn b o m I1L • �J O _ e 0 U u9i 1: 0 - o • j z� 1 a • • • 11411'.. yet • e— o z •-4 o , a) L— N E j, N 0 • O cu 1 • Z- �.. V^ c -�� • Y Y ct 0) J Q• c � �— .. V AV N 3)1I 111W o •• , O •C CU a Lo 2 i_ w cn w m r� , .. 0. —IN V/ 4,." �K • • =a a LO %� • oQa W E UU • m I W J L _ r O .. ,,, ,.,,,. , , • it e4\ 3 °t JIiijiJd1I11IjH • 10PP ^ ..4.. 4*, iiiitilliii g' &01fr x 1. sat ;2,11s-ie_es ge• —� • 40 ♦• • g 4•p:i42 c egEera J % • ..-31.0!iij `la! 956= • •, • HAVEN 7_ I AV N3 P129 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 1 2013/14 Budget Personnel Services Regular Payroll $ 13,170.00 Part-time Salaries 0.00 Fringe Benefits 6,190.00 Subtotal Personnel $ 19,360.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 6,440.00 Equip Operations & Maintenance 500.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 111,900.00 Assessment Administration 22,970.00 General Overhead 3,770.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 145,790.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 165,150.00 Total Estimated Assessment $ 159,510.00 Plus Anticipated Delinquencies 1.060.00 Total Estimated Revenue $ 160,570.00 Plus Operating Reserve Fund Contribution 4.580.00 Total Expenditure Budget $ 165,150.00 Total Estimated Assessment $ 159,510.00 Total District EBU Count 5,508.06 Actual Assessment per EBU — Fiscal Year 2013/14 $ 28.96 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 28.96 Street Lighting Maintenance District No. 4—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P13O The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2012 Reserve Fund Balance $ 492,250.00 Operating Reserve Contribution — Fiscal Year 2013/14 (4,580.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 487,670.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Telephones: This item includes the costs for master controllers for dial-in data lines for uploading, downloading and observing system operations for traffic signals. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Street Lighting Maintenance District No. 4—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P131 Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 4—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P132 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No.4—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P133 • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1984, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 19.96/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Dwelling Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No.4—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P134 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier • Single Family Residential 1.00 Parcel Multi-Family Residential 0.50 Unit Non Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $28.96 $28.96 2,652.00 2,652.00 Multi-Family Residential 28.96 28.96 4,726.00 2,363.00 Non Residential 28.96 28.96 246.53 493.06 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No.4—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P135 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No.4—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bT/EtOZ-JeaA leJsid P136 Pr eSuoweDnj opuej jo Al!0—17•0N 4 !a1s!Q aDueua4u!elJ 2uUyg!1 TaaJils lit u) a) U Lo 'i y J Cl > V r 1 C O cn 0 CA C pi -71�, _ it w 1 r C m O O Z i I nv ise3 in +}C� i ny epuerNiD `__� ny epuenn!13• .CJ I i t mind . le algal° AeQ.._.. ny Japayooej 1 I ny Jaisapoel ny uaal!II!W f —_.._..— I ny uaal!II!W Ill i i i i i i I ny uaneH I I my uaneH I i ny esowJaH I Oil I ny esowie AV PIe9!4oJy I 1 ny PleglgoJy ny uewllaH 1 ny uewllaH I t � 1 !ny pJeAau!n is ue!laweo i 1 I E1 a� 1111144111 "---%—.._..----•!. _..._.._..�"r✓_ (� L O a0 c-a-- I:Fez C CO LL ill I i1: 4 -a >-, 1113 I cn al III °° 1IiIi!IHIU 0;:... ` as j i P137 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $28.96 2,652.00 2,652.00 $76,801.92 Multi-Family Residential 28.96 4,726.00 2,363.00 68,432.48 Non Residential 28.96 246.53 493.06 14,279.02 TOTALS 7,624.53 5,508.06 $159,513.42 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexation is effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code) 1077-422-21, 22 04/06/11 TR 18782 192 Units 96.00 Multi-Family Residential and 1077-422-25 Street Lighting Maintenance District No. 4—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P138 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 5 (Caryn Planned Community) P139 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 5 (CARYN PLANNED COMMUNITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P140 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P141 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 5 (Caryn Planned Community) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2613/14 Total Estimated Assessment $ 44,150.80 Less Anticipated Delinquencies (1,000.00) Total Estimated Revenue $ 43,150.00 Plus Reserve Fund Contribution 24,330.00 Total Expenditure Budget $ 67,480.00 Total District EBU Count 1,276.00 Actual Assessment per EBU $ 34.60 Maximum Allowable Assessment per EBU $ 34.60 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P142 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P143 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the repair, removal or replacement of all or any part of any improvement. Servicing means the furnishing of services and materials for the ordinary and usual maintenance, operating and servicing of any improvement. Servicing shall also include. vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P144 matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P145 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga. The boundaries of the District are generally described as that area located north of the 1-210 Freeway, south of Banyan Street, west of Rochester Avenue and east of Milliken Avenue, also known as the Caryn Planned Community. The boundaries also include Tract No. 13835 east of Rochester Avenue and Tracts No. 13748, 13857 & 13858 west of Milliken Avenue. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 5 Fiscal Year 2013/14 bT/£TOZ JeaA lepsid P146 g e2uowepn0 oipuej Jo AlD—S 'ON 13!a1s!a aDueualuiew 2uilu2i1 laaalS Z � hiO O m W ), 0 C� J (i) 0 (i) • • • •--Tet • •• • [I • • • •1. . • • • • j • • • • • • • • • • opm....... AV 2131ST-1008 U) • • •• • • • 4:16 --- _ • • • •• •• • ILO 0 ••.• • • • • • • .0 —- -- ---t_-.�J • {I•• V L • • • •? • • C7 co• •M E Q • •I • • 4 % A,. N• o CI 0 03 ---/-...../40.„ • i • • • • 1 • c ..e. • • r 4 • • • N ciS cu 04.>73_0_,...4 • • / Z Fri vi • • I\ LU . H • o • a N p • 0 et • Atl N3)IIllWI JIL• •• - • • • 0/ 1 .132.; 1 'Tv g.'Sr.4g • , • 4 • e •• .40.4r-•—A, O.p LL liiig9t��LrQi e momiiiiiiiiiiicr.. P147 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 4,140.00 Part-time Salaries 0.00 Fringe Benefits 1,950.00 Subtotal Personnel $ 6,090.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 7,440.00 Equip Operations & Maintenance 0.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 45,390.00 Assessment Administration 7,020.00 General Overhead 1,330.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 61,390.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 67,480.00 Total Estimated Assessment $ 44,150.80 Less Anticipated Delinquencies (1,000.00) • Total Estimated Revenue $ 43,150.00 Plus Operating Reserve Fund Contribution 24,330.00 Total Expenditure Budget $ 67,480.00 Total Estimated Assessment $ 44,150.00 Total District EBU Count 1,276.00 Actual Assessment per EBU — Fiscal Year 2013/14 $ 34.60 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 34.60 Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P148 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 25,200.00 Operating Reserve Contribution — Fiscal Year 2013/14 (24,330.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 870.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Telephones: This item includes the costs for master controllers for dial-in data lines for uploading, downloading and observing system operations for traffic signals. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P149 Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: • Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. III Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P150 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement' (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P151 • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1986, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P152 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units IProperty Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Parcel The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $34.60 $34.60 1,276 1,276 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P153 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 13 Fiscal Year 2013/14 ga l...I 1 1 I = v 1144/14,1 11!! D o co = a o 21;94101! = r L. 1:11,:t#1 t U' 7JJ CO z (n ' 1,111110 17 Grove Av ;_.._..---•-»1.._r- _._.., f1,imait a i IA :Ij#i#i j ! Carnelian St Vineyard Av j ' rn 1 Hellman Av r I Hellman Av I 1 Archibald Ay! j i 1 Archibald Av 1 ! Hermosa Av• Hermosa Av I j Haven Av1 i i Haven Av j I j I j j Milliken Av I �_.._.._.._.._.J Milliken Av I I Rochester Av Rochester Av ' .� .-..-..Day Creek BI al I i j I i I— r^. Etiwanda Av I__..—_ Etiwanda Av i Zs A 1 I tioi East Av 1. \ ' 1 0 o co ( I .y, co o Tl W r— /! 1 CD = r /ZA` N CD W o ti::.) N Cherry Av ti r - CD IIIIII r- o V), 3 Pak CP C) it K r Ilk 0 Ch Street Lighting Maintenance District No. 5-City of Rancho Cucamonga 14 VS L Fiscal Year 2013/14 P155 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $34.60 1,276 1,276 $44,149.60 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Street Lighting Maintenance District No. 5—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P156 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 6 (Commercial/Industrial) P157 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 6 (COMMERCIAL/INDUSTRIAL) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P158 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P159 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 6 (Commercial/Industrial) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 129,400.00 Less Anticipated Delinquencies 0.00 Total Estimated Revenue $ 129,400.00 Less Reserve Fund Collection (11,390.00) Total Expenditure Budget $ 118,010.00 Total District EBU Count 2,517.62 Actual Assessment per EBU $ 51.40 Maximum Allowable Assessment per EBU $ 51.40 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P160 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P161 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the repair, removal or replacement of all or any part of any improvement. Servicing means the furnishing of services and materials for the ordinary and usual maintenance, operating and servicing of any improvement. Servicing shall also include vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the . assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P162 matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and ' assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P163 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as the commercial and industrial area of the City which is generally bounded by Foothill Boulevard on the north, 4th Street on the South, East Avenue on the east and Grove Avenue on the west. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 5 Fiscal Year 2013/14 VT/ETOZ JeaA lepsIi P164 g OuoweanO oyauea;o AID—9 •oN 13PIsic aaueualulew 8ui;y2ii lawis Z < w rE o cm m a_ m (D Al W I ys'� AVAaa3Ha UU) 0 3 C , . I 0 c r, o a 0 11 s O co w w m.e";e 1ONVMIl3 �%\\ 1 I :y ,� .� aNVM113 .3 pi i i[ �1� .-(a.it up ityrywriit ca.:;,,, C L�A _+_ r°TQAq-H33Hagal+�i7 a`— N W a mr co m tla« o dl — M1 �-:--w;4. 919 C C jtt4IiIij°$ Y [ ir I cu V C e _. _ N {� O V.N3NIplIW 'ems b6 o iisk1I!r� ,,,), kir of.r E Rr[III E sl i r C1 ' 11:, tan _ nbtlsowa3H ■'7 1 ■ o Nr Leo_H Tree.'MI gilillli, 0 Mp "1 O\t,il ilm- `J j — LLL J.,'� 1b altviHoaV � . Iegw pv ` GL■� W ed U_Et�il � N f m rya' wJ•-r �i ��� _ L1AVNVWll3H J' A I I, i . . �t E 11� . TI Mid, ��� f • .1 v a,¢Y .inir g Flit' 1S WVIl3Hi r e N1 ig' \r pyI a 2945 nag =�r 1S 38IHdd\S lr B NI �^.7 alga isil z'°dga1 co ea'• 3°Eeg ll1li1iffi°ll:"1nt=9gi i e9y'I .'c s §sg g a9 °i"611,1 to-2'1$Y 3 li= JI1i1!llihillhII':1�� P165 ESTIMATE OF COSTS • The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 13,170.00 Part-time Salaries 0.00 Fringe Benefits 6.190.00 Subtotal Personnel $ 19,360.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 6,940.00 Equipment Operations & Maintenance 400.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 82,370.00 Assessment Administration 5,590.00 General Overhead 3,140.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 98,650.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 118,010.00 Total Estimated Assessment $ 129,400.00 Less Anticipated Delinquencies 0.00 Total Estimated Revenue $ 129,400.00 Plus Operating Reserve Fund Contribution (11,390.00) Total Expenditure Budget $ 118,010.00 Total Estimated Assessment $ 129,400.00 Total District EBU Count 2,517.62 Actual Assessment per EBU — Fiscal Year 2013/14 $ 51.40 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 51.40 Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P166 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 357,130.00 Operating Reserve Contribution — Fiscal Year 2013/14 0.00 Operating Reserve Collection — Fiscal Year 2013/14 11,390.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 368,520.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P167 District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. • Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P168 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P169 • improving the livability, safety, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1987, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 19.96/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P170 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Non Residential 1.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Non Residential $51.40 $51.40 2,517.62 2,517.62 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P171 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 13 Fiscal Year 2013/14 VILE-10Z JeaA leJs P172 !d VI e2uoweonj otpuea Jo AiD—9 ON PPu4s!Q aDueualu!evJ 2u!lgS!1 TaanS tO a tea r w U) 4 o o CI >5 i ny Ai eqo iT C- c i I, m r o "i~ i N L CO Z i my peg in .= i ny epuenn!ts nv epuenn!y .ft. i J i �.,, a) is paio Aea ny iatsayooa ! n to y j �atsa o0 y y 8 j 1 AV ua)l!II!IN t._.._.._.."..._._ AV ua)l!II!W ■ AV uaneH ny uaneH ny esowJOH ° ny esowjaH AV Pleq!yaiy AV Pleq!yaJtJ ny uewllaH — ny uewllaH co (/) L L , ny pieAau!A is ue!lawe3 Iiiiiil iMi a t Alf 111!)11111° eii ny anal°c m EE_ N hill s it t J _ L t VE _ CF1 L O co I f•t�`�r ii Q N m u_ }ii Ca i 1 ie !ig li t ' i fill/10Y ?td:ti1 •!li P173 ASSESSMENT ROLL Assessment Roll _ The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable _ (County Use Code) per EBU Units/Acres EBUs Assessment Non Residential $51.40 2,517.62 2,517.62 $129,405.67 TOTALS 2,517.62 2,517.62 $129,405.67 "Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Street Lighting Maintenance District No. 6—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P174 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 7 (North Etiwanda) P175 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 7 (NORTH ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P176 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P177 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 7 (North Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 120,120.00 Less Anticipated Delinquencies (13,650.00) Total Estimated Revenue $ 106,470.00 Plus Gas Tax Contribution 94,420.00 Total Expenditure Budget $ 200,890.00 Total District EDU Count 3,605.00 Actual Assessment per EDU $ 33.32 Maximum Allowable Assessment per EDU $ 33.32 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P178 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P179 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the repair, removal or replacement of all or any part of any improvement. Servicing means the furnishing of services and materials for the ordinary and usual maintenance, operating and servicing of any improvement. Servicing shall also include vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P180 matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P181 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City known as North Etiwanda, which is generally bounded by Highland Avenue on the south, Day Creek Channel on the west and City limits on the east and north. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 5 Fiscal Year 2013/14 bT/£TOZ aeaA Ieas!3 P182 9 e8uoweanj oyauea 40 AT!)—L 'ON Ta!TS!O aaueua;u!ew Sunif21 Taaljs Z � �� \ .- dby�stj ` \ Z'. L J 03 e — ca c co-14.\\ x� N c 7 V w m ` Hcc w t n m . _ \ W H to 0 — I ti C , \ I .{(o .� N ` ,cp-s I1 - Z > rr, �,;i �3r. v i tplr � 1,cfk - ei. 4N 10 Vi... fa Lc;r ''''A\ 1 O 1 ■I y Z/hG 'l ', 4` I tI .�. 3rd I,g< ����\ ��I ��% I/I , au moot 8 NVwaaVM t. \ I. i ^1 - d C i __I „«tt, 8 . . - C �v , — — il�.,l--I� �I iiri q• N � h "I ri ... V ► _ 1 ;F �- _. u1 f- : 1- . ▪C - --- - ---- ----- _ ,,., 111 _ rt{r 1 _ - .i 1 I �,I I I 1 .1 11 _ I 1t 'I ` 1 I.` r Itf�L i viSH3 p', t Ht ▪ as -- -I v - 11 r t-1 ? aI . . • m �; E r �- = ,il in1 CD �, f _.r il'i 't o rE - 4+ Atl.VaNVMIL3'' ' AV VaNVMI13 f AV.VONVMII3 w1 tll ifjIit 111 CO - ■ I ir . j I k i4 - -9. ` 14-1 I i.W- -1 r:F i^{7 y m/r!'i I .=RV-L t vI I Lu- ^> i 1�4 ` 1- I' 1 i I I�� '` \ 1 t o afY F _-o--:- s q^ 3--gra T E .11 ` ,.Pv =r'-1-tf 1\i4., �/VW 7 2 X14 1 C lie I AC r 1 j E, It, ; arN g3 ? ` 1 1 I F I III ,: { �1ie1�l33aAVa ul i{IiIII�) 1 1�'�' �y x r { i Rya I��I[�'!II'i'i1i�l I a ..i..«1_ ,, r, ,,,y am -_z_ ?� T<. .A._ _.w...� ,, •,,,, I {ti i 11)lIk!I1 , 12;./g f N 11 111;l1 Iliilli►1�1• 1 �Lj _I . 1 I I) i �i Iil;[II{t, 30II• n5' - nr'+[h •.1-14 1-I+-1-1 P183 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 13,170.00 Part-time Salaries 0.00 Fringe Benefits 6.190.00 Subtotal Personnel $ 19,360.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 4,940.00 Equipment Operations & Maintenance 4,940.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 152,950.00 Assessment Administration 19,840.00 General Overhead 3,590.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 181,530.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 200,890.00 Total Estimated Assessment $ 120,120.00 Less Anticipated Delinquencies (13,650.00) Total Estimated Revenue $ 106,470.00 Plus Gas Tax Contribution 94.420.00 Total Expenditure Budget $ 200,890.00 Total Estimated Assessment $ 120,120.00 Total District EDU Count 3,605.00 Actual Assessment per EDU — Fiscal Year 2013/14 $ 33.32 Maximum Allowable Assessment per EDU — Fiscal Year 2013/14 $ 33.32 Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P184 The maximum allowable assessment per EDU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EDU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 63,900.00 Operating Reserve Fund Contribution — Fiscal Year 2013/14 0.00 Operating Reserve Collection — Fiscal Year 2013/14 10.210.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 74,110.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P185 District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P186 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P187 • improving the livability, safety, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1990, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Dwelling Unit ("EDU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Dwelling Unit (EDU). Every other land-use is converted to EDUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P188 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EDU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EDU Value Multiplier Single Family Residential 1.00 Parcel Multi-family Residential 0.50 Unit Non Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EDU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EDU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EDU Units/Acres EDUs per EDU Single Family Residential $33.32 $33.32 3,605.00 3,605.00 Multi-family Residential 33.32 33.32 0.00 0.00 Non Residential 33.32 33.32 0.00 0.00 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P189 ASSESSMENT DIAGRAM • An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. • Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bt/£ZOZ aeeA leos!i P190 bT e2uowe3n0 oypuea jo ATID–L ON 1.P1-1TslG apueualu!elN 2u!4yS!1 TaaJTS I\ a) *MO in 0 US .12 J N. r Q Q c U (..) g -44 Fir rit c o Ru.) Z ►b■ C J m E. o as w us L ,= m o O 'Inv Ise3 6 1:),\ I L *.I E i AV epuemg3 C I ...4 i vow I I ny Jalsayooa i n oo ler 0 i I y salsa y a Ay ua)l!II!W t._.._.._..-.-..? i nv ua>l!II!W i i i i i ny uaneH i i my uaneH I i ny esowJek I i Ay ESOWJa 1 I i AV PIe9!yo-It! I 4111 I !Ay Pleq!yoltf t ny uewlleH I I Ay uewllOH I s t I I ny p BAawn IS ue!lawe3 i i 6 i ...•���—. i NIPAilit!ii i i tr.._..: o: –r'1"-----.._.._r ny OAOJO ` s ; in ° I. L J _ 3 L I „s F 0 E6 a 6 ca 0 Q 111111111W 73 c = CD tilliFily: 1 qiiallitieg4 'hi Pill 0..:::::...I i ;I; .4....ifig P191 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EDU Units/Acres EDUs Assessment Single Family Residential $33.32 3,605.00 3,605.00 $120,118.60 Multi-family Residential 33.32 0.00 0.00 0.00 Non Residential 33.32 0.00 0.00 0.00 TOTALS 3,605.00 3,605.00 $120,118.60 *Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexations are effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code) 0225-011-37 11/7/2012 PM 19043 2.00 2.00 Single-Family Residential 0226-081-17 11/21/2012 PM 19367 2.00 2.00 Single-Family Residential Street Lighting Maintenance District No. 7—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P192 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Street Lighting Maintenance District No. 8 (South Etiwanda) P193 CITY OF RANCHO CUCAMONGA STREET LIGHTING MAINTENANCE DISTRICT NO. 8 (SOUTH ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P194 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 6 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 23 District Budget Definitions of Budget Items Method of Assessment 26 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 30 Assessment Roll 32 Assessment Roll Annexations P195 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga (the "City"), under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-097, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Street Light Maintenance District No. 8 (South Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed NBS to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 68,690.00 Plus Anticipated Delinquencies 25,150.00 Total Estimated Revenue $ 93,840.00 Plus Reserve Fund Contribution 998,950.00 Total Expenditure Budget $ 1,092,790.00 Total District EBU Count 2,244.78 Actual Assessment per EBU $ 30.60 Maximum Allowable Assessment per EBU $ 30.60 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P196 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P197 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the repair, removal or replacement of all or any part of any improvement. Servicing means the furnishing of services and materials for the ordinary and usual maintenance, operating and servicing of any improvement. Servicing shall also include vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the Street Lighting Maintenance District No.8—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P198 matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. • Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P199 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City known as South Etiwanda, which is generally bounded by Etiwanda Avenue on the west, Highland Avenue on the north and Foothill Boulevard on the south. The southern portion of the District is bounded by East Avenue on the east and the northern portion of the District is bounded by the 1-15 Freeway on the east. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of street lights, traffic signals and appurtenant facilities throughout the District. The maintenance and servicing includes, but is not limited to, furnishing electric current for public lighting facilities including street lights and traffic signals, and associated appurtenant facilities. Services include personnel, materials, contracting services, utilities, and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in operational and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, in order to lower expenses of the District. Map of Improvements The following page shows the map of street light and traffic signal improvements to be maintained using District funds. Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 5 Fiscal Year 2013/14 - ' ;- I�� ri '1�[ - -`1,-�j \:,),-ilL__ 1 rui.trJ . ir_-. I ,.'_/ \ ' X00 l Street Lighting Maintenance District No. 8 -° 1- Street Lights and Traffic Signals Improvements c caum.°t _al, � / 1 iI \ ', / ll5�_l `___ L _— _-- __ -� I I AMP - LF 121D FW Lll rl � ' ,1 -P250 WEST-R _u- ;.Alikk 1)2.101FWr—Iy 5rS0 'Rehr AND`AV I IGHIANDAV"l -- - MRAM? 715th. �v 11 I77 I n rinTi \i I ■J 1 I I ` 1 1 1 1 1 1 I I 11 \ \\I I I I' ��R��Rims /� f1� . II ,, - 1 - r, -a**stew I L1i 1 I ♦ ••�.••• I 1•-•'-• I 1 r T 00, r . 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I'i 111'1i'l'I 11 F. i5 I Iir_f• a!`�-k ;'1 R PT? '}+.- 4-1171—C)l fn it .�1 1,- _ - S� k LII. �•_ +�lwl_ 111 ii ,-% ���. � The maps,data and geographic information('Inform anon') I�=ie j` •.• r•\N yr '� � aailable by and through the Gty of Rambo Cucamonga u1-II7Tri--<d �l�tl ImT It - �•+a•i , Tl L • •- are Resented as apublic resource ofgmeralinformton. ' .•� I!u Attlee. Tic h ty o Rancho Cucamonga makes nor lmphes no !f''IIII fl 1 L waran representation or tee as to the content. I o 'n- — tl Cfr T?t,1 c ce.aoozm guarantee 1-'�<t{L C i li -- S•.‘.•'.4-....., 7E1,11, - sequence,accuracy completeness or timeliness of any �\uzzn YYY �e /I / f!- {1111 a Infonthe on provided to you herein The user should not rely yL/RC' 1)H / •�?I��111 Ian ffZ ' l � �- upon the lnformati on for my reason and is directed to 1 r. 1 .s MILLER AV Its Lund" independently yeti fy any and all lnfoenatiun presented herein. \ __. I 7.74;17'–.1,;,,.1 The City of Rancho Cucamonga explicitly ad without limitation I disclaims any and all rspresmuions old warrantees, ma-ch s,ivctudiari ,��SS ,i I+lIJA e ,L I�•� but not limited to,the implied warannes of merchantability and •a11a.t -M • Mums for a particular purpose The City of Ranch Cucanonga / "t1''+I■t•l1,- shall neither accept nor assume any liability,regardless of the T'1'I ll Ii_ ♦♦ ■ • causation for(I)my mars omissions or inaccuracies in��I I) 11111:;t �'I j• ' any information provided and/or(i)my action or inaction / 1y t-j]j'F• }}� ocmthle due to any pesonsreliace upon the Information / 1-1 T •;),..t...;.,,,..I � -1.1-c- .r. : % available herein. Hi f 1=' 411a0Rm1RMRn ,0.Q I_ fa'iJH'=,�T !-{- � _ >;5: if SCE Streetlights rr , `\ I °">`" '= Traffic Signal Lights 1 I �-L� � ! Ifl1 -' I 0141 FOOTHILL BL — _ 111. g g • 1S _o__I 1 H I qrJ .4.wl/l c' / 1•1I,r 11 ii _7_S I SLD8 Boundary . 0 0.225 0.45 0.9 Mile City Boundary _--_- I --'-'7 I Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P201 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 11,780.00 Part-time Salaries 0.00 Fringe Benefits 5,540.00 Subtotal Personnel $ 17,320.00 Operations and Maintenance Training $ 180.00 Membership Dues 30.00 Operations and Maintenance 5,540.00 Equipment Operations & Maintenance 0.00 Contract Services 0.00 Utilities Telephone Utilities 0.00 Electric Utilities 55,750.00 Assessment Administration 9,750.00 General Overhead 4,220.00 Interfund Allocation 0.00 Subtotal Operations and Maintenance $ 75,470.00 Capital Expenditures Capital Projects $ 1,000,000.00 Subtotal Capital Expenditures $ 1,000,000.00 Total District Expenditure Budget $ 1,092,790.00 Total Estimated Assessment $ 68,690.00 Plus Estimated Prior Year Delinquencies & Interest 25,150.00 Total Estimated Revenue $ 93,840.00 Plus Operating Reserve Fund Contribution 998,950.00 Total Expenditure Budget $ 1,092,790.00 Total Estimated Assessment $ 68,690.27 Total District EBU Count 2,244.78 Actual Assessment per EBU — Fiscal Year 2013/14 $ 30.60 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 30.60 Street Lighting Maintenance District No.8—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P202 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the total amount of funds needed to maintain the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 2,433,460.00 Operating Reserve Contribution — Fiscal Year 2013/14 (998,950.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 1,434,510.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Training: International Municipal Signal Association (ISMA) Certification. The cost is split evenly between all of the City's Street Light Maintenance Districts. Membership Dues: ISMA certification. The cost is split evenly between all of the City's Street Light and Maintenance Districts. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the street lights and traffic signals. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P2O3 District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P204 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D, all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the public lighting facilities, including traffic signals. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly • distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P205 • improving the livability, safety, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing for safe vehicular and pedestrian access for properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. General Benefit In addition to the special benefits received by parcels within the District, there are derivative general benefits that are conferred on parcels outside the boundaries of the District which include: • the safety and visual enhancement of the area to persons or vehicles that may travel through the District However it has been determined that these benefits are derivative and do not provide a direct benefit to parcels outside of the district that are not being assessed. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1990, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific Street Lighting Maintenance District No.8—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P206 development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Parcel Multi-family Residential 0.50 Unit Non Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $193.75 $30.60 1,114.00 1,114.00 Multi-family Residential 193.75 30.60 1,057.00 1,057.00 Non Residential 193.75 30.60 31.89 63.78 Church 193.75 30.60 5.00 10.00 TOTAL 2,207.89 2,244.78 The total amount of maintenance and incidental costs for maintaining the street lights and traffic signals is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Street Lighting Maintenance District No.8—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P207 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Street Lighting Maintenance District No.8—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bZ/£ZOZ Jea), leis!j P208 VT e8uowe3nO oq ueo Jo AT!O—8 'oN TD!J s!p aaueualulelj 8u!11.18!1 laa.i}S 00 a) V •ft, N Cl) v -� co .,.� >` a J 4 c c U 0 LI i V - - (�'` ny tiJ8143 r r s i I _ o w i s .0 I m o CD i u_ Q —i^y ISe3 L lea i ..1 I..._�_.. .L i ny epuerwl3 i Ay epueM!13 0 0 4188.0 Aep , I + AV Jalsayo08 i 1 n Ja sa oO i y 14 a rj i my ua)l!II!W r._.._.._.._.._.? j^y ual!II!W 1 'i 1 I i i ny uaneH i i i my uaneH f ii i Ay esowJaH I (✓4 i ny esowJo i i AV Pleq!4 �b o i i ^y PIe9!4oay i d Ay uewIlaH N ny uewllaH te°°(— -fr I i Ay pJeAau!A IS uellauJeo i i i i r l :ie + gr+ �.._.._ 2 —r-1.— .._.._.._.._r Ay anal° Ei sgnt11 c m fY 6 1110 � ;i : .000...000 cni _ V� , ,, Q i a c� °o Q IN €s 21111 cc I co L.L. ° i l" 10 c to m i i!�tfsi'0 E ` ` ` i1gi 0i !esti! at P209 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $193.75 1,114.00 1,114.00 $215,837.50 Multi-family Residential 193.75 1,057.00 1,057.00 204,793.75 Non Residential 193.75 31.89 63.78 12,357.38 Church 193.75 5.00 10.00 1,937.50 TOTALS 2,207.89 2,244.78 $434,926.13 Actual Property Type Assessment Rate Total Total Actual (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $30.60 1,114.00 1,114.00 $34,088.40 Multi-family Residential 30.60 1,057.00 1,057.00 32,344.20 Non Residential 30.60 31.89 63.78 1,951.67 Church 30.60 5.00 10.00 306.00 TOTALS 2,207.89 2,244.78 $68,690.27 A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexations are effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code) 0227-131-03 1/18/12 TR 18806 33.00 33.00 Single-Family Residential 0225-161-65 & 71 4/18/12 TR 18096 33.00 33.00 Single-Family Residential Street Lighting Maintenance District No. 8—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P210 As STAFF REPORT y ADMINISTRATIVE SERVICES GROUP bilge j RANCHO CUCAMONGA Date: July 3, 2013 To: Mayor and Members of the City Council John R. Gillison, City Manager From: Lori E. Sassoon, Deputy City Manager/Administrative Service& By: Ingrid Y. Bruce, GIS/Special Districts Manager Subject: CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMENTS, PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN LANDSCAPE MAINTENANCE DISTRICT NO. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 AND 10 FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC HEARING THEREON. RECOMMENDATION: It is recommended that the City Council approve the Resolutions ordering the preparation of the Annual Engineer's Reports to initiate the proceedings to levy annual assessments, preliminarily approve the Annual Engineer's Reports and, declaring the City Council's intention to levy annual assessments within Landscape Maintenance District No. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 and 10. The Engineer's Reports are also on file in the City Clerk's Office. BACKGROUND/ANALYSIS: This year, the City will place on the County Tax Roll eleven (10) Landscape Maintenance Districts (LMDs). The assessments received for each of these Districts are utilized for the maintenance and operation of parks and other landscaping. Maintenance and operation includes but is not limited to turf, ground cover, planter beds, shrubs, plants and trees, landscape lighting, irrigation systems, electrical energy for irrigation controllers, insect/disease control, graffiti removal, hardscapes, entry signs, sound walls and all associated appurtenant facilities. The City utilizes prior year carryovers along with current year assessment revenues to meet the district's annual expenses. When the LMDs were established, they were in conjunction with new development coming into the City, and were intentionally designed to ensure that each district bore the costs of the maintenance of the infrastructure that provides special benefit to the property owners. It has been over 16 years since there was an assessment increase in most of the LMDs, and certain districts will soon require an assessment increase in order to remain financially self-sustaining while continuing to provide a high level of maintenance in the parks, paseos, and other landscaped areas. No rate increase can occur, however, unless the City Council authorizesa Proposition 218 ballot process to give the property owners the opportunity to express their support for, or in opposition to, an increase in such assessment. Over the last several years, Prop 218 election processes were P211 CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF PACic 2 THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL., ASSESSMENTS,PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN LANDSCAPE MAINTENANCE DISTRICT NO. 1,3A,3B,4—R,5,6—R,7,8,9 AND 10 FOR FISCAL YEAR 2013/14 AND SE'ITING T1-LE TIME AND PLACE FOR A PUBLIC HEARING THEREON. Juix3,2013 held in LMDs 2, 4-R, 6-R and 8. Updated assessments were approved by the property owners in those districts, with the exception of LMD 8, where maintenance levels were significantly reduced. The assessment rates and descriptions for each of the Landscape Maintenance Districts are as follows. Note that LMD 2 is not included here as Council has already taken action in that district as part of the recent ballot process. Landscape Maintenance District No. 1 assessments pay for the on-going maintenance of parkways. The current assessment rate is $92.21 per single-family residence, and the multi-family is $46.11 per dwelling unit. This district has a significant structural deficit, and will require a rate increase in the very near future to maintain service levels. Staff is working with our assessment enginer to evaluate alternate ways of restructuring this district, including the possibility of creating multiple smaller districts to replace the larger LMD 1. This will be discussed as an urgent matter in conjunction with PD 85 in the FY 2013-14 fiscal year. Landscape Maintenance District No. 3A assessments pay for the on-going maintenance of parkways on Hyssop Drive. The current assessment rate is $413.74 per acre for commercial property. Landscape Maintenance District No. 3B assessments pay for the on-going maintenance of parkways within the commercial and industrial area of the City. The current assessment rate is $352.80 per acre for commercial property. This district will require a rate increase in the future to maintain service levels. Landscape Maintenance District No. 4-R assessments pay for the on-going maintenance of parkways, paseos and parks within the Terra Vista Planned Community. The current assessment rate is $380.00 per single-family residence, the condominium rate is 304.00 per dwelling unit and the multi-family rate is $266.00 per dwelling unit. The commercial rate is $1,235.00 per acre, and the vacant rate is $95.00 per acre. Landscape Maintenance District No. 5 assessments pay for the on-going maintenance of a Tot Lot located on the southwest corner of Andover Place and Bedford Drive. The Fiscal Year 2013/14 actual assessment rate is reduced from the prior year due to the City having reserve funds that are more than sufficient to cover an estimated six months' worth of maintenance and servicing costs for the District. When there are excess funds in the District's reserve account, the excess can be used to lower the annual levy to property owners within the District. The City will continue to annually review the estimated costs and expenses for the District as well as reserve fund levels, in order to determine if future levies can be reduced as well. The assessment rate is being reduced from $113.29 to $56.65 per single-family residence. Landscape Maintenance District No. 6-R assessments pay for the on-going maintenance of parkways and paseos within the Caryn Planned Community. The assessment rate for Fiscal Year 2013/14 will increase to $390.65 per single-family residence Zone 1 and to $292.99 per single family residence Zone 2. These rates include a CPI increase of 2.22% per Equivalent Benefit Unit as compared to Fiscal Year 2012/13. P212 CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF PACT?3 THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMENTS,PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORTS, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN LANDSCAPE MAINTENANCE DISTRICT NO. 1,3A,3B,4-It,5,6-R,7,8,9 AND 10 FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC 1-TEARING THEREON. JUI.v 3,2013 Landscape Maintenance District No. 7 assessments pay for the on-going maintenance of parkways and paseos within the Etiwanda Highlands Community. The current assessment rate is $307.05 per single-family residence. This district will require a rate increase in the future to maintain service levels. Landscape Maintenance District No. 8 assessments pay for the on-going maintenance of parkways in South Etiwanda. The current assessment rate is $151.45 per single-family residence. Landscape Maintenance District No. 9 assessments pay for the on-going maintenance of parkways and Garcia Park in South Etiwanda. The Fiscal Year 2013/14 actual assessment rate is reduced from the prior year due to the City having reserve funds that are more than sufficient to cover an estimated six months' worth of maintenance and servicing costs for the District. When there are excess funds in the District's reserve account, the excess can be used to lower the annual levy to property owners within the District. The City will continue to annually review the estimated costs and expenses for the District as well as reserve fund levels, in order to determine if future levies can be reduced as well. The reduced assessment rate is being reduced from $187.00 to $80.00 per single-family residence. Landscape Maintenance District No. 10 assessments pay for the on-going maintenance of parkways, trails and parks in the District. The current assessment rate is $616.20 per single-family residence and $1,232.40 per acre for commercial property. Attachments Resolutions Engineer's Reports P213 RESOLUTION NO. 13-100 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORTS PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN LANDSCAPE MAINTENANCE DISTRICT NO. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 AND 10, INCLUSIVE, FOR FISCAL YEAR 2013/14 WHEREAS, the City Council of the City of Rancho Cucamonga, California, previously undertaken proceedings to form and has formed certain maintenance districts pursuant to pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act"), known and designated as Landscape Maintenance District No. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 and 10, inclusive (each, a "District" and collectively, the "Districts"); and WHEREAS, at this time the City Council desires to initiate proceedings pursuant to Chapter 3 of the 1972 Act to provide for the annual levy of assessments for the next ensuing fiscal year to provide for the annual costs for maintenance and servicing of improvements within the Districts; and WHEREAS, the proceedings for the annual levy of assessments shall relate to the fiscal year commencing July 1, 2013, and ending June 30, 2014 ("Fiscal Year 2013/14"). NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. New Improvements or Substantial Changes in Existing Improvements. No new improvements are proposed to be added to the improvements to be maintained or serviced and no substantial changes in the existing improvements are proposed to be made for Fiscal Year 2013/14. SECTION 3. Annual Engineer's Reports. The City Engineer is hereby ordered to prepare and file with this City Council an Annual Engineer's Report for each District relating to such annual assessment and levy in such District in accordance with the provisions of 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"). SECTION 4. Filing of the Annual Engineer's Reports. Upon completion, the Annual Engineer's Report for each District shall be filed with the City Clerk, who shall then submit the same to this City Council for its consideration pursuant to the Assessment Law. P214 PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P215 RESOLUTION NO. 13-101 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORTS FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN LANDSCAPE MAINTENANCE DISTRICTS NO. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 AND 10, INCLUSIVE, FOR FISCAL YEAR 2013/14 WHEREAS, the City Council of the City of Rancho Cucamonga, California, pursuant to the provisions of Division 15, Part 2 of the Streets and Highways Code of the State of California (the "1972 Act"), Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), did, by previous Resolution, order the preparation of a separate report for the annual levy of assessments for Fiscal Year 2013/2014 (each, an "Annual Engineer's Report") in certain maintenance assessment districts known and designated as Landscape Maintenance District No. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 and 10, inclusive (each, a "District" and collectively, the "Districts"); and WHEREAS, there has now been presented to this City Council a separate Annual Engineer's Report for each District as required by the Assessment Law and as previously directed by Resolution; and WHEREAS, this City Council has now examined and reviewed each Annual Engineer's Report as presented, and is satisfied with each and all of the items and documents as set forth in each such report, and is satisfied that the assessments on a preliminary basis, have been spread within each District in accordance with the special benefits received from the improvements to be maintained and serviced, as set forth in the applicable Annual Engineer's Report. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Annual Engineer's Reports. The Annual Engineer's Report for each District as presented, consisting of the following: A. Plans and specifications describing the general nature, location and extent of the improvements to be maintained and serviced and the extent of such maintenance; B. An estimate of the cost of the maintenance of the improvements for the District for Fiscal Year 2013/14; • C. A diagram for such District, showing the area and properties proposed to be assessed; and P216 D. An annual assessment for Fiscal Year 2013/14 of the estimated costs of the maintenance and servicing of those improvements to be maintained and serviced during such Fiscal Year, assessing the net amount upon all assessable lots and/or parcels within such District in proportion to the special benefits received is hereby approved on a preliminary basis and is ordered to be filed in the Office of the City Clerk as a permanent record and to remain open for public inspection. SECTION 3. The City Clerk shall certify to the passage and adoption of this Resolution, and the minutes of this meeting shall so reflect the presentation of the Annual Engineer's Reports. PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P217 RESOLUTION NO. 13-102 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2013/2014 IN LANDSCAPE MAINTENANCE DISTRICT NO. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 AND 10, INCLUSIVE, AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed certain maintenance districts and authorized the levy of assessments therein pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972," being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act") in what are known and designated as Landscape Maintenance District No. 1, 3A, 3B, 4-R, 5, 6-R, 7, 8, 9 and 10, inclusive (each a "District" and collectively, the "Districts"); and WHEREAS, this City Council has initiated proceedings to provide for the annual levy of assessments for Fiscal Year 2013/14, to finance the costs and expenses necessary for continued maintenance and servicing of improvements within each District; and WHEREAS, at this time, there has been presented and approved by this City Council, a separate report for each District identified by the distinctive designation of such District and entitled "Fiscal Year 2013/14 Annual Engineer's Report" (each, an "Annual Engineer's Report" and collectively, the "Annual Engineer's Reports") as required pursuant to Article 4 of Chapter 1 of the 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), and this City Council desires to conduct the proceedings to authorize the levy of the annual assessments within each District; and WHEREAS, the annual assessments for Fiscal Year 2013/14 proposed to be levied within each District as set forth in the applicable report do not exceed the annual assessments as previously authorized to be levied within such District and, therefore, the proposed levy of assessments for Fiscal Year 2013/2014 within such District are not deemed to be "increased" over the maximum authorized annual assessments. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Improvements and Maintenance and Servicing Thereof. The public interest and convenience requires, and it is the intention of this City Council, to undertake proceedings for the annual levy and collection of assessments within each District for the continual maintenance and servicing of the improvements authorized to be maintained and serviced within each such District. The improvements include, but are not limited to, turf, ground cover, planter beds, shrubs, plants and trees, landscape lighting, irrigation systems, electrical energy for irrigation P218 controllers, hardscapes, entry signs, sound walls, and all associated appurtenant facilities. A description of the specific improvements to be maintained and serviced within each District is set forth in Appendix A attached hereto and incorporated herein by this reference. "Maintenance" may include the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including: (a) repair, removal, or replacement of all or any part of any improvement; (b) providing for the life, growth, health, and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; (c) the removal of trimmings, rubbish, debris, and other solid waste; (d) the cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti. "Service" may include the furnishing of: (a) electric current or energy, gas, or other illuminating agent for the lighting or operation of any improvements; and, (b) water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. Reference is made to the applicable Annual Engineer's Report for further information regarding the improvements to be maintained and serviced for each District and the scope of such maintenance and service. SECTION 3. Annual Engineer's Reports. The Annual Engineer's Reports regarding the annual levy for each District for Fiscal Year 2013/2014 have been preliminarily approved and directed to be filed in the Office the City Clerk. Reference is made to the applicable such report for each District for a full and detailed description of the improvements to be maintained and serviced, the boundaries of such District and any zones therein, and the proposed assessments upon assessable lots and parcels of land within such District. SECTION 4. Assessment. The public interest and convenience requires, and it is the intention of this City Council to order the annual levy of assessments for each District as set forth and described in the applicable Annual Engineer's Report, and further it is determined to be in the best public interest and convenience to levy and collect annual assessments to pay the costs and expenses of such maintenance and service as estimated in such Annual Engineer's Report. SECTION 5. Boundaries of Districts. The proposed maintenance and service work as described in the Annual Engineer's Report for each District is, in the opinion of this City Council, of special benefit to the properties within the boundaries of such District, and this City Council makes the costs and expenses of such maintenance and service chargeable upon each such District, which District said City Council hereby declares to be the District specially benefited by such maintenance and service, and to be further assessed pursuant to the Assessment Law to pay the costs and expenses thereof. Each such District shall include each and every parcel of land within the boundaries thereof; as such District is shown on a map or maps as approved by this City Council and on file in the Office of the City Clerk, and so designated by the name of such District. SECTION 6. Public Hearing. Notice is hereby given that a public hearing will be held the 17th day of July, 2013 at the hour of 7:00 o'clock p.m. or as soon thereafter as the matter may be heard, in the regular meeting of the City Council, being in the Council Chambers located at 10500 Civic Center Drive, Rancho Cucamonga, California, which is the time and place fixed by this City Council for the hearing of protests or objections in reference to the annual levy of P219 assessments, to the extent of the maintenance, by any interested person and any other matters contained in this resolution. Any persons who wish to object to the proceedings for the annual levy should file a written protest with the City Clerk prior to the time set and scheduled for said public hearing. SECTION 7. For Information Regarding Proceedings. For any and all information relating to the proceedings, protest procedure, any documentation and/or information of a procedural or technical nature, your attention is directed to the below listed person at the City: Ingrid Bruce GIS/Special Districts Manager City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, CA 91730 (909) 477-2700, Ext 2575 SECTION 8. Notice. The City Clerk is hereby authorized and directed to publish, pursuant to Government Code Section 6061, a copy of this Resolution in the Inland Valley Daily Bulletin, a newspaper of general circulation within said City, said publication shall be made one time and not less than ten (10) days before the date set for the Public Hearing. PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this , at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P220 Appendix A Descriptions of Improvements This Appendix A contains general descriptions of the improvements to be maintained and serviced within each of the Districts. Please refer to the Annual Levy Reports for a full and complete description of the maintenance and service to be provided for each District. Landscape Maintenance District No. 1 Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Paseos Street Trees Entry Monuments Community Trails Parks: (Parks within LMD No. 1 include: Bear Gulch Park, East and West Beryl Park, Old Town Park, Church Street Park, Golden Oaks Park, Hermosa Park, Lions Park, Don Tiburcio Tapia Park and the Rancho Cucamonga Adult Sports Complex) Landscape Maintenance District No. 3A Landscaping: Parkways (includes ground cover only) Landscape Maintenance District No. 3B Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Street Trees Entry Monuments Landscape Maintenance District No. 4-R Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Paseos Street Trees Parks (Parks within LMD No. 4-R include: Spruce Park, Mountain View Park, Ralph M. Lewis Park, Coyote Canyon Park, Milliken Park and West Greenway Park) Landscape Maintenance District No. 5 Landscaping: Tot Lot at Andover and Bedford (includes ground cover only) Landscape Maintenance District No. 6-R • Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Paseos Street Trees Community Trails A - 1 P221 Landscape Maintenance District No. 7 Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Paseos Street Trees Community Trails Parks (Parks within LMD No. 7 include: Etiwanda Creek Community Park) Landscape Maintenance District No. 8 Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Paseos Street Trees Community Trails Landscape Maintenance District No. 9 Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Street Trees Parks (Parks within LMD No. 9 include: Garcia Park) Landscape Maintenance District No. 10 Landscaping: Parkways (includes turf and ground cover) Median Islands (includes turf and ground cover) Street Trees Community Trails Parks (Parks within LMD No. 10 include: Day Creek Park) A - 2 P222 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 1 (General City) P223 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 1 (GENERAL CITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P224 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 21 District Budget Definitions of Budget Items Method of Assessment 24 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 28 Assessment Roll 30 Assessment Roll Annexations P225 ENGINEER'S LETTER WHEREAS, on July 3, 2013 the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 1 (General City) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 1,195,450.00 Less Anticipated Delinquencies (13,490.00) Total Estimated Revenue $ 1,181,960.00 Plus Reserve Fund Contribution 220,560.00 Total Expenditure Budget $ 1,402,520.00 Total District EBU Count 12,964.46 Actual Assessment per EBU $ 92.21 Maximum Allowable Assessment per EBU $ 92.21 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 1—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P226 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 1—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P227 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 1—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P228 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, or opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 1—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P229 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City which is not located within the City's planned development communities. The District is made up of various landscaped sites throughout the City. As such, the parcels within the District do not represent a distinct district area as do the other LMDs within the City. Typically parcels have been annexed to the District as they have developed. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout the District. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Bear Gulch Park, East and West Beryl Park, Old Town Park, Church Street Park, Golden Oaks Park, Hermosa Park, Lions Park, Don Tiburcio, and Tapia Park. Site# Descriptive Location A-1 The north and south side of Wilson from Hellman to Amethyst. Ground Cover area: 22,982 square feet Hardscape area: 5,694 square feet A-2 The east side of Hellman from 326 feet south of Pepperidge to 73 feet north of Pepperidge. Ground Cover area: 5,810 square feet Hardscape area: 1,600 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P230 A-3 The south side of 19th Street from 62 feet east of Mayberry to 173 feet east of Mayberry. Ground Cover area: 1,680 square feet Hardscape area: 440 square feet A-4 The south side of Wilson from Amethyst to Archibald; the planters and cutouts on the west side of Archibald from Wilson to 105 feet south of Cottonwood. Ground Cover area: 5,625 square feet A-5 The north and south side of Diamond Court from Klusman to Diamond Ave. Ground Cover area: 3,143 square feet Hardscape area: 1,864 square feet A-6 The parkway on the north side of Wilson from 348 feet east of Morning Canyon to Alder Ridge. Ground Cover area: 5,700 square feet Hardscape area: 4,760 square feet A-7 The cutouts and vines on the south side of Wilson from the Alta Loma Channel to 240 feet east of Zapata. Ground Cover area: 911 square feet A-8 The east side of Broken Star from 80 feet south of Highland to Highland; the north side of Highland from Amethyst to Broken Star including wood chip area north of sidewalk, the south side of Highland from Broken Star to Amethyst; the west side of Amethyst from 140 feet south of Highland to 265 feet south of Highland. Ground Cover area: 6,545 square feet Hardscape area: 2,554 square feet Mulchscape area: 14,005 square feet A-9 The south side of Highland from Hellman to Broken Star. Ground Cover area: 7,865 square feet A-10 The south side of 19th from 170 feet west of Pilgrim to 167 feet east of Pilgrim. Ground Cover area: 1,808 square feet Hardscape area: 1,084 square feet A-11 The east side of Amethyst from Lemon to 230 feet north of Apricot. Ground Cover area: 2,115 square feet Hardscape area: 3,438 square feet A-12 The west side of Sapphire from 710 feet north of Hillside to Hillside. Landscape Maintenance District No. 1—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P231 Ground Cover area: 4,500 square feet A-13 The south side of Victoria from 110 feet west of London to Ramona. Ground Cover area: 2,705 square feet Hardscape area: 3,480 square feet A-14 The west side of Archibald from 273 feet north of La Gloria to Lemon; the La Gloria median from Archibald to Jadeite; the north and south side of La Gloria from Archibald to 53 feet east of Jadeite; the north side of Lemon from Archibald to 55 feet east of Klusman. Ground Cover area: 12,880 square feet Hardscape area: 12,030 square feet A-15 The planters and cutouts on the east side of Archibald from 610 feet south of Cottonwood to Wilson; the south side of Wilson from Archibald to Alta Loma Channel. Ground Cover area: 2,110 square feet A-16 The cutouts and planters on the east side of Archibald from Banyan to 190 feet north of Sunflower. Ground Cover area: 1,580 square feet A-17 The cutouts and planters on the west side of Archibald from 225 feet south of Wilson to Banyan. Ground Cover area: 2,362 square feet A-18 The cutouts and planters on the north side of Banyan from Jadeite to 410 feet west of Jadeite. Ground Cover area: 216 square feet A-19 The cutouts and planters on the east side of Amethyst from 192 feet south of Sunflower to Manzanita. Ground Cover area: 4,325 square feet A-20 The west side of Archibald from 210 feet north of La Colina to 230 feet south of Almond; the south side of La Colina from Archibald to Jadeite. Ground Cover area: 17,120 square feet A-21 The planter adjacent to the equestrian trail from Riverwood to Raspberry north of the County flood retention basin that is west of Chaffey College. Ground Cover area: 22,832 square feet A-22 The west side of Haven from Carrari to Vista Grove. Ground Cover area: 4,572 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P232 A-23 The west side of Haven from 434 feet north of Manzanita to 258 feet south of Manzanita. Ground Cover area: 48,390 square feet Turf area: 5,868 square feet Hardscape area: 4,581 square feet A-24 The south side of 19th from 286 feet east of Amethyst to 166 feet west of Klusman. Ground Cover area: 5,904 square feet Hardscape area: 2,938 square feet A-24 The south side of 19th from 286 feet east of Amethyst to 166 feet west of Klusman. Ground Cover area: 5,904 square feet Hardscape area: 2,938 square feet A-25 The equestrian trail and planters on the east side of Hermosa from 421 feet south of Whispering Forest to Sun Valley. Ground Cover area: 17,529 square feet A-26 The west side of Haven from 630 feet north of Wilson to Wilson; the parkway on the north side of Wilson from Haven to Mayberry; the parkway on the east side of Mayberry from Wilson to 382 feet north of Poplar, and the east and west side of Cartilla from Wilson. Ground Cover area: 10,243 square feet Mulchscape area: 25,297 square feet A-27 The north side of 19th from Mayberry to 93 feet east of Castle Gate. Ground Cover area: 5,145 square feet Hardscape area: 2,870 square feet A-28 The east side of Hermosa from 360 feet south of Manzanita to Manzanita, and the south side of Manzanita from Hermosa to Raspberry. Ground Cover area: 7,421 square feet Hardscape area: 4,712 square feet A-29 The south side of Wilson from 240 feet west of Timbermist to Hermosa; the west side of Hermosa from Wilson to 213 feet south of Oak Grove. Ground Cover area: 11,184 square feet A-30 The equestrian trail and plant material from the curb to the tract wall on the west side of Hermosa from 118 feet south of Hillside to 160 feet south of Waterford. Ground Cover area: 12,132 square feet A-31 The south side of Lemon from London to Calle Hermosa. Landscape Maintenance District No. 1—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P233 Ground Cover area: 4,404 square feet Hardscape area: 1,800 square feet A-32 The north side of Lemon from the Alta Loma Channel to London; the east side of London from Lemon to Cypress. Ground Cover area: 4,463 square feet Hardscape area: 3,375 square feet A-33 The parkway on the east side of London from 158 feet north of banyan to 310 feet north of Banyan. Ground Cover area: 1,029 square feet Hardscape area: 1,160 square feet A-34 The south side of Alta Loma from Mayberry to Revere. Ground Cover area: 2,772 square feet Note: 1,512 square feet of ground cover deleted from this site on 7-00. A-35 The west side of Hermosa from Lemon to 125 feet north of Highland, the parkway on the south side of Lemon from 621 feet west of Hermosa to Hermosa. Ground Cover area: 10,494 square feet Hardscape area: 9,207 square feet Mulchscape area: 2,370 square feet A-36 The south side of Lemon from 385 feet west of Mayberry to Cartilla. Ground Cover area: 4,850 square feet Hardscape area: 4,915 square feet A-37 The south side of Hillside north and south of the equestrian trail from Beryl to 203 feet east of Eastwood. Ground Cover area: 4,900 square feet A-38 The median in the 9200 block of Monte Vista. Ground Cover area: 500 square feet Hardscape area: 1,380 square feet A-39 The south side of Almond from Henry to Sapphire; the west side of Sapphire from Almond to 255 feet south of Bella Vista. Ground Cover area: 6,926 square feet A-40 The parkway on the east side of Jasper from Hunter to Highland; the parkway on the south side of Highland from Jasper to Carnelian; the west side of Carnelian from Highland to 210 feet south of Highland. Ground Cover area: 14,858 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P234 Hardscape area: 6,040 square feet A-41 The west side of Sapphire from 236 feet north of Thoroughbred to Banyan. Ground Cover area: 1,784 square feet Hardscape area: 812 square feet A-42 The parkway on the west side of Beryl from 132 feet north of Sunflower to 23 feet north of Sunflower; and from Sunflower to Banyan. Ground Cover area: 4,735 square feet Hardscape area: 5,772 square feet A-43 The north side of Base Line from Topaz to the Cucamonga Creek Channel. Ground Cover area: 4,563 square feet Hardscape area: 1,890 square feet A-44 The cutouts on the west side of Sapphire from Banyan to Marble. Ground Cover area: 7,300 square feet A-45 The mainline for this site was connected to A-46 9-8-99. A-46 The south side of Banyan from North Star to Zircon. Ground Cover area: 7,448 square feet Hardscape area: 7,890 square feet A-47 The cutouts and vines on the north side of Banyan from 180 feet east of Zircon to 186 feet west of Vineyard. Ground Cover area: 1,300 square feet A-48 The parkway on the west side of Beryl from 452 feet north of Cielito; 158 feet south of Cielito and the easement between 9063 and 9073 Cielito from Cielito to 170 feet south of Cielito. Ground Cover area: 6,916 square feet Hardscape area: 2,440 square feet A-49 The east side of Carnelian from 662 feet south of Banyan to Banyan; the south side of Banyan from Carnelian to Northstar. Ground Cover area: 5,906 square feet Hardscape area: 6,972 square feet A-50 The north side of Almond from Sapphire to Crest View; the east and west side of Skyline from Almond to 595 feet north of Almond. Ground Cover area: 17,600 square feet Hardscape area: 8,680 square feet Landscape Maintenance District No.1—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P235 A-51 The planter adjacent to the equestrian trail; from haven to Riverwood, north of County flood retention basin, west of Chaffey College. The west side of Haven from 400 feet north of Amber to 270 feet south of Amber. Ground Cover area: 37,977 square feet Hardscape area: 5,458 square feet A-52 The east side of Riverwood, from 188 feet south of Charwood to 193 feet north of Charwood. Ground Cover area: 2,750 square feet Hardscape area: 5,458 square feet A-53 The west side of Jasper from Hunter to Highland. The south side of Highland from Jasper to 308 feet west of Sard. The east and west side of Sard from Highland to Hunter. Ground Cover area: 7,445 square feet Hardscape area: 4,740 square feet A-54 The west side of Beryl from 233 feet north of Mignonette to Mignonette. Ground Cover area: 2,637 square feet Hardscape area: 932 square feet A-55 The north side of 19th from Cartilla to Mayberry. The east side of Mayberry from 19th to Heather. Ground Cover area: 8,410 square feet Hardscape area: 5,060 square feet A-56 The east side of Beryl from 410 feet north of Wilson to Wilson. The north side of Wilson from Beryl to 731 feet west of Buckthorn. The south side of Wilson from Buckthorn to Beryl. Ground Cover area: 19,708 square feet Hardscape area: 5,436 square feet A-57 The east side of Hermosa from 115 feet north of Coca to 451 feet north of Coca. The trail north of water retention basin from Hermosa to 619 feet east of Hermosa. Ground Cover area: 9,406 square feet Hardscape area: 6,794 square feet A-58 The west side of Haven from 510 feet south of Victoria to 1005 feet south of Victoria. Ground Cover area: 7,301 square feet Hardscape area: 4,790 square feet A-59 The east side of Archibald from 820 feet south of Lemon to 448 feet south of Lemon and continues from 275 feet south of Lemon to 185 south of Lemon. Landscape Maintenance District No.1—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P236 Ground Cover area: 4,777 square feet Hardscape area: 5,041 square feet A-60 The south side of Lemon from 290 feet east of Archibald to London. The west side of London from Lemon to Orange. Ground Cover area: 2,569 square feet Hardscape area: 4,122 square feet A-61 The north side of Carrari from Archibald to London. Ground Cover area: 25,152 square feet Hardscape area: 1,698 square feet A-62 The east side of Archibald from Carrari to 505 feet north of Meadowood. Ground Cover area: 8,626 square feet Hardscape area: 1,824 square feet A-63 The south side of Almond street from Carriage to Almond. Ground Cover area: 3,342 square feet • Hardscape area: 3,600 square feet A-64 The east side of Beryl from Cottonwood to Wilson. The south side of Wilson from Beryl to 437 feet east of Beryl. The north side of Wilson from Cousins to 474 feet east of Cousins. Ground Cover area: 11,973 square feet Hardscape area: 9,949 square feet A-65 The east side of Archibald from La Gloria to 328 feet north of La Gloria. Ground Cover area: 2,279 square feet Hardscape area: 2,411 square feet A-66 The east side of Hermosa from Waterford to 500 feet north of Waterford. Ground Cover area: 4,695 square feet Hardscape area: 5,947 square feet A-67 The south side of 19th from 220 feet east of Sapphire to Via Serena. Ground Cover area: 3,208 square feet Hardscape area: 4,158 square feet A-68 The west side of Haven from Hillside to 783 feet south of Hillside. Ground Cover area: 3,492 square feet A-69 The north side of Hillside from 27 feet west of Mayberry to 191 feet west of Mayberry. Ground Cover area: 1,002 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P237 Hardscape area: 1,605 square feet A-70 The south side of 19th from 365 feet west of Amethyst to Amethyst. The west side of Amethyst from 19th to Hedges. Ground Cover area: 6,435 square feet Hardscape area: 7,015 square feet A-71 The west side of Archibald from Hillside to Wilson Avenue. The north side of Wilson, south of the trail fence area from Archibald to 467 feet west of Archibald. Ground Cover area: 9,265 square feet Hardscape area: 2,609 square feet A-72 The south side of Banyan from 420 feet west of Archibald to Archibald. The west side of Archibald from Banyan to 389 feet south of Banyan. Ground Cover area: 10,270 square feet Hardscape area: 6,673 square feet A-73 The west side of Beryl from 300 feet north of San Simeon Drive to 130 feet north of San Simeon Drive. Ground Cover area: 1,200 square feet Hardscape area: 600 square feet A-74 The south side of Highland Ave from Beryl St to Hellman Ave. Ground Cover area: 11,603 square feet A-75 The south side of Highland Ave from Amethyst St to 612 feet east of Archibald Ave Ground Cover area: 106,409 square feet Hardscape area: 60,608 square feet A-76 The west side of Archibald from 635 feet north of Hillside to Hillside. The north side of Hillside from Archibald to 770 feet west of Archibald. Ground Cover area: 8,859 square feet Hardscape area: 1,389 square feet A-77 The east side of Carnelian from Brilliant Ln to Wilson including the irrigation cut-outs along trail. The south side of Wilson from Carnelian to 745 feet east of Arabian Dr. The irrigation cut-outs on the north side of Wilson from Carnelian to 775 feet east of Arabian Dr. Ground Cover area: 5,101 square feet Hardscape area: 11,322 square feet • B-1 The median on Blue Gum from Etiwanda to Blue Gum Court. Ground Cover are: 5,100 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P238 B-2 The north side of 19th from Highland to Palm; the west and east side of Alameda fro 19th to Ring; the east side of Palm from 19th to Ring. Ground Cover area: 47,397 square feet Hardscape area: 26,285 square feet B-3 The paseo from Sutter Ct. to Deer Creek Channel. Ground Cover area: 294 square feet Hardscape area: 400 square feet B-4 The north side of Banyan from Deer Creek Channel to 355 feet west of Fredericksburg. Ground Cover area: 9,200 square feet Hardscape area: 3,834 square feet B-5 The north side of Lemon from Semillion to 188 feet west of Terracina. Ground Cover area: 14,472 square feet Hardscape area: 3,894 square feet B-6 The north side of Lemon from Barsac to Semillion. Ground Cover area: 15,784 square feet Hardscape area: 3,780 square feet B-7 The south side of Banyan from Cabernet to 414 feet east of Cabernet. Ground Cover area: 18,814 square feet B-8 The south side of Banyan from Callaway to Muscat. Ground Cover area: 10,505 square feet • B-9 The east side of Haven from Banyan to 240 feet north of Banyan; the north side of Banayan from Haven to Merlot. Ground Cover area: 24,975 square feet Hardscape area: 1,356 square feet B-10 The east side of Haven from 400 feet south of Banyan to Banyan; the south side of Banyan from Haven to Callaway. Ground Cover area: 14,548 square feet Hardscape area: 6,348 square feet B-11 The south side of Banyan from Muscat to Cabernet. Ground Cover area: 33,282 square feet B-12 The north side of Lemon from Barsac to 135 feet east of Valinda. • Landscape Maintenance District No. 1—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P239 Ground Cover area: 13,464 square feet Hardscape area: 4,098 square feet B-13 The south side of 19th from Inyo to 585 feet east of San Benito; the parkways on the east and west side of San Benito from 19th to San Mateo; the east side of Inyo from 19th to paseo south of 19th and the paseo running east from Inyo to Sonora. Ground Cover area: 17,563 square feet Turf area: 3,387 square feet Hardscape area: 14,192 square feet B-14 The paseo from San Benito and Sonora to the Deer Creek Channel. Ground Cover area: 2,000 square feet Hardscape area: 540 square feet B-15 The paseo from Stanislaus and Lavine to the Deer Creek Channel. Ground Cover area: 1,040 square feet Hardscape area: 428 square feet B-16 The paseo from Inyo to Mendocino. Ground Cover area: 225 square feet Hardscape area: 184 square feet B-17 The paseo from Yuba Ct to Deer Creek Channel. Ground Cover area: 918 square feet Hardscape area: 420 square feet B-18 The south side of Wilson from 377 feet west of Canistel to 1032 feet east of Canistel. Ground Cover area: 6,762 square feet Hardscape area: 8,454 square feet B-19 The east side of Haven from the Southern Pacific Railroad to 341 feet south of Victoria. Ground Cover area: 6,415 square feet Hardscape area: 8,865 square feet B-20 The east side of Haven from 341 feet south of Victoria to Victoria; the south side of Victoria from Haven to 237 feet east of Mango. Ground Cover area: 16,900 square feet Hardscape area: 8,767 square feet B-21 The south side of 19th from Valinda to Inyo Ground Cover area: 3,900 square feet Hardscape area: 3,700 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P240 B-22 The south side of Lemon south of the sidewalk from 188 feet west of Terracina to 284 feet north of Marbella. The parkway on the south side of Lemon from 188 feet west of Terracina to 517 feet north of Marbell. The turf in the parkway at the end of the cul- de-sac on Sonterra Court. The parkway on the north side of Lemon from 188 feet west of Terracina to 526 feet south of Terracina. The north side of Lemon north of the sidewalk from 188 feet west of Terracina to 562 feet south of Terracina. The turf in the parkway at the end of the cul-de-sac at Serena Street. Ground Cover area: 17,688 square feet Turf area: 6,390 square feet Hardscape area: 4,928 square feet B-23 The parkway on the east side of Lemon from 129 feet south of Marbella to 526 feet south of Terracina. The slope on the east side of Lemon east of the sidewalk from 129 feet south of Marbella to 562 feet south of Terracina. The west side of Lemon west of the sidewalk from 284 feet north of Marbella to 129 feet south of Marbell. The parkway on the west side of Lemon from 517 feet north of Marbella to 129 feet south of Marbell. Ground Cover area: 22,531 square feet Hardscape area: 4,468square feet Note: There was 11,844 square feet of ground cover deleted from this site 7-1-00 B-24 The south side of Highland from 327 feet west Deer Creek Channel to Deer Creek Channel. The paseo from Los Osos to Deer Creek Channel. Ground Cover area: 4,946 square feet Hardscape area: 2,099 square feet B-25 The south side of Banyan from 152 feet west of Cantabria to 930 feet east of Cantabria. Ground Cover area: 16,693 square feet B-26 The north side of Wilson from 590 feet west of High Meadow Place to 187 feet east of High Meadow Place. Ground Cover area: 4,628 square feet Hardscape area: 390 square feet B-27 The east side of Haven from 467 feet north of 19th St to 650 feet north of 19th St. Ground Cover area: 3,483 square feet Hardscape area: 6,235 square feet C-1 The north side of 26th from Andover to Hermosa; the east side of Hermosa from 26th to 331 feet north of Concord. Ground Cover area: 12,804 square feet Turf area: 9,423 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P241 Hardscape area: 5,532 square feet C-2 The entry monument on the north east and north west corners of 4th and Archibald. Ground Cover area: 6,337 square feet Hardscape area: 3,998 square feet Note: Decreased turf 5,546 sq ft, increased ground cover 477 sq ft and increased hardscape 2,156 sq ft. 1/15/13 C-3 The south side of Base Line from Ramona to 128 feet east of Cambridge. Ground Cover area: 17,262 square feet Hardscape area: 4,865 square feet C-4 The south side of Base Line from 440 feet west of Ramona to Ramona. Ground Cover area: 6,198 square feet Hardscape area: 2,200 square feet C-5 The south side of Base Line from 340 feet west of Center to 103 feet east of Center. Ground Cover area: 8,850 square feet Hardscape area: 2,215 square feet C-6 The south side of Base Line from Ivy to 105 feet west of Marine. Ground Cover area: 8,080 square feet Hardscape area: 2,475 square feet C-7 The parkway on the north side of Church from 142 feet east of Teak to 230 feet west of Teak. Ground Cover area: 1,813 square feet Hardscape area: 1,650 square feet C-8 The west side of Hermosa from 524 feet north of Palo Alto to 142 feet south of Palo Alto. Ground Cover area: 2,650 square feet Hardscape area: 3,996 square feet C-9 The parkway on the west side of Hermosa from 163 feet north of Ironwood to 145 feet south of Ironwood. Ground Cover area: 1,500 square feet Hardscape area: 1,848 square feet C-10 The entry monument parkway on the south side of Base Line from the western city limit to Alta Cuesta. Ground Cover area: 9,756 square feet Hardscape area: 4,380 square feet Landscape Maintenance District No. 1—City of Rancho Cucamonga 17 Fiscal Year 2013/14 P242 C-11 The parkway on the east side of Beryl from Alder to 135 feet north of Culpepper. Ground Cover area: 3,400 square feet Hardscape area: 3,600 square feet C-12 The parkway on the east side of Hellman from Tryon to 665 feet north of Tryon. Ground Cover area: 8,280 square feet Hardscape area: 3,325 square feet C-13 The parkway on the west side of Hellman from 500 feet north of Church to Church. Ground Cover area: 2,416 square feet Hardscape area: 3,000 square feet C-14 The east side of Archibald from 196 feet north of Palo Alto to 530 feet north of Palo Alto. Ground Cover area: 4,262 square feet Hardscape area: 1,374 square feet C-15 The north side of San Bernardino from Summerlin to 225 feet west of Summerlin. Ground Cover area: 1,660 square feet Hardscape area: 710 square feet C-16 The south side of Base Line from 286 feet west of Hermosa to Hermosa. The raised planter on the southwest corner of Base Line and Hermosa. Ground Cover area: 4,190 square feet Hardscape area: 2,320 square feet C-17 The east side of Hellman from 775 feet south of 6th St to 6th St. The south side of 6th St from Hellman to Golden Oak Rd. The west side of Golden Oak Rd from 6th St to Foxbrook Dr. Ground Cover area: 9,058 square feet Hardscape area: 6,387 square feet D-1 The east side of Rochester from Church to Base Line. Ground Cover area: 11,126 square feet Turf area: 16,794 square feet Hardscape area: 17,301 square feet D-2 The east side of Rochester from 146 feet south of Chervil to Church St. Ground Cover area: 11,908 square feet Turf area: 9,950 square feet Hardscape area: 13,263 square feet D-3 The south side of Baseline from Rochester to 600 feet east of Rochester. Landscape Maintenance District No. 1—City of Rancho Cucamonga 18 Fiscal Year 2013/14 P243 Ground Cover area: 2,180 square feet Hardscape area: 4,121 square feet D-4 The north and south sides of Church St from Rochester to 150 feet east of Hyssop Dr. Ground Cover area: 6;340 square feet Hardscape area: 8,887 square feet H-9 The Haven median from the 210 freeway to Alta Loma. Ground Cover area: 2,207 square feet H-10 The Haven median from entrance of Haven Village to Amber Lane. Ground Cover area: 6,968 square feet Converted 5,131 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 1. An equal amount is maintained by General Fund. 3/25/13 H-11 The Haven median from Amber Lane to Olive Street. Ground Cover area: 5,026 square feet Converted 3,475 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 1. An equal amount is maintained by General Fund. 3/25/13 H-12 The Haven median from Olive Street to 712 feet north of Wilson. Ground Cover area: 6,734 square feet Converted 3,933 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 1. An equal amount is maintained by General Fund. 3/25/13 H-13 The Haven median from 19th St to the 210 freeway. Ground Cover area: 12,514 square feet FH-18 The Foothill median from East Avenue to 453 feet east of Cornwall Avenue. Ground Cover area: 5,450 square feet Ground cover, shrubs and turf areas that make up parkways, median islands and paseos are maintained under contract by a private landscape maintenance company. Parks are maintained by the City's Park Maintenance Crews. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 1—City of Rancho Cucamonga 19 Fiscal Year 2013/14 P244 4T/£i0Z Jea)less OZ e2uoweonj ogauea yo A 10-L '0N pif1si0 aDueua;wew adempuei . g E W W Z ...11; C. .t z Q w a U J 0 w N H .c Z W rty 2 z0 N O Q (Q >" �•N. Cr Q Cu- Q V) CO I Q a;/l < ct d ct a _J 2 cr ) to - `I 0-'`. o rei • \ g E _ ILJ r - _„„se3 to;O p.k\ts., i znbepue/NG n�P 9 III e VGW� . N a. h.. q,maeyx — 911 U •bt ,us/111N1 m I L � � 1",N N f�0 �mm N O �e Ti b Ncm:O T IU�O '.m] Q Q'm N .�l.�_ N—m':.--C ♦b uaeeH C7 al ¢ m�',2t> { n _ I■■ ■ b oaael{ _ a .. /�/� N N91�m . N 1V Q a C< ¢yy NC` 109 I' .0 ar 0�/� M E"s GimaH ,4lw p�N < Q Vi s0w40H YI r4r 1 .10 aV 4.. TS Q Q- YQ 0 QA 11 V v V Q ¢ ¢ ; 1 4VU U `_{� q'PS914aM p ¢ � `9 ¢ 4�V �,.IV9!4aq J"— N 0 A �Qy hN 6S & .� \ III■,u G---.:C—ca4cQ QQ `..c O.N O Q ebueupay{ .q"Tea-¢� _� '�" uewlleH . ! ,6 a Fr�Q U V v • S e 4 <CIL 4 - Is ueilaweo 6 e 'MI r ai Fe a e rI✓�� E°lg'^ 9a °LIc Q L 1 �- e?a;6`SYE35y19'a- CcV G„:Ev„r F:es_ o; .N a ..4 Q iS J _ gaewg 3319: 3.i}y s_qqa Fegfi Q Q Q Q P $ s; In 2i5"Ai6<c_6S�CU>e^' m E G �2° vu�1 yy3 ccp•° i.I,E a LL g3e- :sgs':gei:ae31 .. i 7 Zoe;et A Y:.S s . P:g3iy iy ' : ; 1 arzat Se?:°-n e: P245 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 150,990.00 Part-time Salaries 22,400.00 Fringe Benefits 73.430.00 Subtotal Personnel $ 246,820.00 Operations and Maintenance Operations and Maintenance $ 70,570.00 O & M Facilities 6,500.00 Vehicle Operations and Maintenance 2,000.00 Emergency Equipment& Vehicle Rental 800.00 Equipment Operations and Maintenance 3,800.00 Depreciation of Computer Equipment 0.00 Contract Services 492,600.00 Contract Services/Facilities 5,000.00 Tree Maintenance 50,000.00 Utilities Telephone Utilities 2,550.00 Water Utilities 317,640.00 Electric Utilities 68,630.00 Assessment Administration 65,870.00 General Overhead 67,040.00 Subtotal Operations and Maintenance $ 1,153,000.00 Capital Expenditures Capital Outlay— Equipment $ 2,700.00 Capital Outlay—Vehicles 0.00 Subtotal Capital Expenditures $ 2,700.00 Total Expenditure Budget $ 1,402,520.00 Total Estimated Assessment $ 1,195,450.00 Less Anticipated Delinquencies (13,490.00) Total Estimated Revenue $ 1,181,960.00 Plus Operating Reserve Fund Contribution 220,560.00 Total Expenditure Budget $ 1,402,520.00 Total Estimated Assessment $ 1,195,450.00 Total District EBU Count 12,964.46 Actual Assessment per EBU — Fiscal Year 2013/14 $ 92.21 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 92.21 Landscape Maintenance District No. 1—City of Rancho Cucamonga 21 Fiscal Year 2013/14 P246 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund $ 436,250.00 Balance Operating Reserve Contribution — Fiscal Year 2013/14 (220,560.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund $ 215,690.00 Balance Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Landscape Maintenance District No. 1—City of Rancho Cucamonga 22 Fiscal Year 2013/14 P247 Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 1—City of Rancho Cucamonga 23 Fiscal Year 2013/14 P248 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIIID of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 1—City of Rancho Cucamonga 24 Fiscal Year 2013/14 P249 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the District and were installed to create a common landscape theme and neighborhood identity for parcels within the District. The improvements are situated within the public rights-of-way of the internal local street network within the District which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the District and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. Landscape Maintenance District No. 1—City of Rancho Cucamonga 25 Fiscal Year 2013/14 P25O When the District was formed in 1979, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit.Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. Vacant parcels are assigned an EBU value of 0.25 per acre because they receive a lesser benefit from the improvements until such time as development occurs. The following table provides the weighting factors applied to various land-use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Benefit Unit Multi-Family Residential 0.50 Benefit Unit Non-Residential 2.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type (County Use Maximum Allowable Actual Total Total Code) Assessment Rate Assessment Units/Acres EBUs per EBU Rate per EBU Single Family Residential $92.21 $92.21 7,880.00 7,880.00 Multi-Family Residential 92.21 92.21 10,141.00 5,070.50 Non-Residential 92.21 92.21 6.98 13.96 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the Landscape Maintenance District No. 1—City of Rancho Cucamonga 26 Fiscal Year 2013/14 P251 District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No. 1—City of Rancho Cucamonga 27 Fiscal Year 2013/14 P252 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 1—City of Rancho Cucamonga 28 Fiscal Year 2013/14 bT/£TOZ JeaA'emu P253 6Z e2uownno opuea;o AID—T IN 1JIJ1sla aDueuaauleW adempue1 0 a V .� -- w ,� 1 64 CD ° J1— ® Z C ' U _ o Q � L1J o C c J 0 C --- . ._ ' D, J VPs c ar la ! J m CD I I 53 .c O 2 li Q RI i ` n Ise rn L ..._(/) C jny epuen:qA ny epuennila X19 51aaJO Aea I ^ ny Japayooa AV Jalsayooqd AV umlill!W 3.• ••••.■•••••1 AV uaiwi IW AV uaneH ny uaneH AV esoWJaH ny esowJaH AV PIe4IU3Jv AV PIeciwoiv AV uewllaH ny uewIlaH L L V (O ny pieAauln Is uepuJe3 I i�i `' ! � �a) m ny anal ';:ijj1 ,1 41 t o c0 Ilc ftj7€'' ar a m u_ {f:#IiIfilli 111.Ei1I.! P254 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Maximum Property Type Allowable Total Total Allowable (County Use Code) Assessment Rate Units/Acres EBUs Assessment per EBU Single Family $92.21 7,880.00 7,880.00 $726,614.80 Residential Multi-Family 92.21 10,141.00 5,070.50 467,550.81 Residential Non-Residential 92.21 6.98 13.96 1,287.25 TOTALS 18,027.98 12,964.46 $1,195,452.86 "Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexation is effective for the 2013/14 Fiscal Year: Assessor's Annexation Total Total Property Type Parcel Project p yp Number Date Units/Acres EBUs (County Use Code) 0207-022- DRC2011- Single- Family 56 03/07/12 00645 1.00 1.00 Residential 0210-062- 05/16/12 TR18804 65.00 60.00 SFD/MULTI 08 Landscape Maintenance District No. 1—City of Rancho Cucamonga 30 Fiscal Year 2013/14 P255 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 3A (Hyssop) P256 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 3A (HYSSOP) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P257 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations P258 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13— 102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 3A (Hyssop Maintenance District) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $3,720.00 Plus Anticipated Interest Earnings 460.00_ Total Estimated Revenue $4,180.00 Plus Reserve Fund Contribution 2.010.00 Total Expenditure Budget $6,190.00 Total District EBU Count 9.00 Actual Assessment per EBU $413.74 Maximum Allowable Assessment per EBU $413.74 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No.3A—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P259 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. • Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No.3A—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P260 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No.3A—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P261 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No.3A—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P262 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City South and East of Hyssop Drive south of 6th Street. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout the District. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Site# Descriptive Location J-1 The west side of Hyssop from south of 6th street to the south end of the cul-de-sac. Ground Cover area: 6,050 square feet Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No.3A—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P263 bT/£TOZ aeaA lexli 9 auowepnj ogJueb 10 Ali0-y£ ON TD!Jlsia aJueua}uiew adeDspue1 ' a Z _ z w W 4 J W 1- Z Z IX ------1 f d J O N r N f . LT O 1 N 1— I I a EE I I I ii x ---I I 1 4Z% CS � l Z V Um. CD -� j I 10 5►flNRP Q Z co • y+ mA SL I 290 Sl 1 cv co MA S 4 1 °lwa et, daNO si i ii 01 RI o Z \ 6`a II '� 01.1,..% `� aE'`£E E; .03e+ei;'.' .pa 4 ^ii vt . Gu L E,.,:i. ..4£i,2 �- r ,g3:!alit,-ih: . �Q.eo, _,, r4. 14• i,r _. - ----- - - ,;E4.%-' _as-Z7P74! CID i i g 1 y t 4 c.8 i_.Z%8 i P264 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 0.00 Part-time Salaries 0.00 Fringe Benefits 0.00 Subtotal Personnel $ 0.00 Operations and Maintenance Operations and Maintenance $ 800.00 Contract Services 3650.00 Utilities Water Utilities 900.00 Electric Utilities 600.00 Assessment Administration 50.00 General Overhead 190.00 Subtotal Operations and Maintenance $ 6,190.00 Capital Expenditures Capital Outlay—Vehicles $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 6,190.00 Total Estimated Assessment $ 3,720.00 Plus Anticipated Interest Earnings 460.00 Total Estimated Revenue $ 4,180.00 Plus Operating Reserve Fund Contribution 2.010.00 Total Expenditure Budget $ 6,190.00 Total Estimated Assessment $ 3,723.66 Total District EBU Count 9.00 Actual Assessment per EBU — Fiscal Year 2013/14 $ 413.74 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 413.74 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund Landscape Maintenance District No.3A—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P265 balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 42,280.00 Operating Reserve Contribution — Fiscal Year 2013/14 (2,010.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 40,270.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Landscape Maintenance District No.3A—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P266 Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No.3A—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P267 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No.3A—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P268 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the District and were installed to create a common landscape theme and neighborhood identity for parcels within the District. The improvements are situated within the public rights-of-way of the internal local street network within the District which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the District and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. Landscape Maintenance District No.3A—City of Rancho Cucamonga 11 Fiscal Year 2013/14 • P269 When the District was formed in 1979, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. Vacant parcels are assigned an EBU value of 0.25 per acre because they . receive a lesser benefit from the improvements until such time as development occurs. The following table provides the weighting factors applied to various land-use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Non-Residential 1.00 Parcel The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: p Maximum Allowable Actual Property Type Assessment Rate Assessment Total Total (County Use Code) Units/Acres EBUs per EBU Rate per EBU Non-Residential $413.74 $413.74 9 9 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No.3A—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P270 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No.3A—City of Rancho Cucamonga 13 Fiscal Year 2013/14 bT/ETOZ meaA IeDs!A P271 VI eSuoweDnj oyDue8Io Alp—yE'oN pulsra aDueualu!ew adempueq 3 to VW E a T.. Q►; J el U 0 2 4M = riI Co d o ` �� �. i lor to i Iii CD r J m O A, co W co i ye m o Q o Ii- Q LC 1 I ® 1 AV 1883 m, t a.AV epuenNl3 — — CD I / I Ay epuen13 1s Co ( y g Neal°Aid" C Av Jatsayooa I i - -- n ie sa o0 I t d 1 y b 1 ra ? Av ua>i!II!yY — (r ` I I Av ua>I!II!W AV U8ARH • —41 ------ I AV UOABH Ay esoweH • --—,.(a.1 — — AV BSOWJOH AV Pley!4oit1 -- {l I AV pley!yoiy AV uewllaH —_. I - ,---�— ny uewl!eH C = L Q e IS uelleweO — - - 1- I Ay pJneu!n,off L� 3i iF L.""��.. c m m I�a;!(>;1#"Pfd e9 i�1011. !•§ a) c 6 !ii ii}eud N l0 ii i it 1/11411111! = 1— 1, ijtsa Sti it?1.1{r_!i . p c; ligivFP.1/ P272 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Non-Residential $413.74 9 9 $3,723.66 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No.3A—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P273 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 3B (Commercial Industrial) P274 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 3B (COMMERCIAL INDUSTRIAL) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 • CITY COUNCIL L. Dennis Michael, Mayor • Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P275 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 10 District Budget Definitions of Budget Items Method of Assessment 13 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 16 Assessment Roll 18 Assessment Roll Annexations P276 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13 — 102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 3B (Commercial Industrial) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 979,260.00 Less Anticipated Delinquencies (8,350.00) Total Estimated Revenue $ 970,910.00 Plus Reserve Fund Contribution 148,170.00 Total Expenditure Budget $ 1,119,080.00 Total District EBU Count 2,775.68 Actual Assessment per EBU $ 352.80 Maximum Allowable Assessment per EBU $ 352.80 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No.3B—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P277 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No.3B—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P278 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No.3B—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P279 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No.3B—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P280 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as the commercial and industrial area of the City which is generally bounded by Foothill Boulevard on the north, 4th Street on the South, East Avenue on the east and Grove Avenue on the west. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Site # Descriptive Location J-2 The monument at the northeast corner of Haven and 4th Street. Ground Cover area: 5,715 square feet Hardscape area: 6,068 square feet J-3 The 6th Street median from Milliken to Pittsburg. Ground Cover area: 3,300 square feet J-4 The entry monuments on the east and west side of 4th and Milliken. Ground Cover area: 19,771 square feet Hardscape area: 9,060 square feet J-5 The Milliken median from Arrow to Jersey. Landscape Maintenance District No.3B—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P281 Ground Cover area: 10,220 square feet J-6 The Spruce median from Foothill to White Oak. Ground Cover area: 4.300 square feet J-7 The 6th Street median from Pittsburg to Richmond. Ground Cover area: 5,114 square feet J-8 The 6th Street median from Richmond to Buffalo. Ground Cover area: 2,476 square feet J-9 The Milliken railroad underpass. Ground Cover area: 165,633 square feet, 12-12-01 added 5199 sq feet Turf area: 4,897 square feet J-10 The 6th Street median from Cleveland to 1,820 feet east of Cleveland. Ground Cover area: 13,310 square feet J-11 The 6th Street median from Buffalo to Rochester. Ground Cover area: 12,400 square feet J-12 The Milliken median from Arrow to Century. Ground Cover area: 13,855 square feet J-13 The Milliken median from Century to Foothill Blvd. Ground Cover area: 3,330 square feet J-14 The 6th Street median from Utica to Cleveland. Ground Cover area: 8,559 square feet J-15 The 6th Street median from Haven to Utica. Ground Cover area: 7,680 square feet J-16 Day creek median from Church to Foothill. Ground Cover area: 8,466 square feet J-17 The Day Creek medians south of Foothill including the traffic circle. Ground Cover area: 6,490 square feet H-1 The Haven median from 4th Street to 6th Street. Ground Cover area: 21,205 square feet 3/25/13: Converted 8,935 sq ft of turf to ground cover effective 4/1/13 Landscape Maintenance District No.3B—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P282 H-2 The Haven medians from 6th Street to the underpass bridge. The east and west side parkways and slopes on Haven from Acacia Street to underpass bridge. Ground Cover area: 54,720 square feet 3/25/13: Converted 2,960 sq ft of turf to ground cover effective 4/1/13 H-3 The Haven medians from underpass bridge to Arrow Route. The east and west side parkways and slopes on Haven from the underpass bridge to Jersey Blvd. Ground Cover area: 56,210 square feet 3/25/13: Converted 3,029 sq ft of turf to ground cover effective 4/1/13 H-4 The Haven median from Arrow Route to Foothill. Ground Cover area: 15,156 square feet 3/25/13: Converted 6,808 sq ft of turf to ground cover effective 4/1/13 H-5 The Haven median from Foothill to Church. Ground Cover area: 11,502 square feet 3/25/13: Converted 10,572 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 3B. An equal amount is maintained by LMD 4R. FH-1 The Foothill median from Spruce to Haven. Ground Cover area: 4,571 square feet The total square footage for the improvement is 9,141; however, due to the location of the improvement the other half is maintained by LMD 4-R. FH-2 The Foothill median from Spruce to Milliken. Ground Cover area: 7,940 square feet The total square footage for the improvement is 15,879; however, due to the location of the improvement the other half is maintained by LMD 4-R. FH-3 The Foothill median from 790 feet west of Market Place to Market Place. Ground Cover area: 4,434 square feet FH-4 The Foothill median from Market Place to Etiwanda. Ground Cover area: 10,392 square feet FH-5 The Foothill median from 360 feet west of Masi Dr to 516 feet west of Masi Dr. Ground Cover area: 800 square feet The total square footage for the improvement is 1,600; however, due to the location of the improvement the other half is maintained by LMD 4-R. FH-6 The Foothill median from Masi Plaza to Rochester. Ground Cover area: 800 square feet The total square footage for the improvement is 1,600; however, due to the location of the improvement the other half is maintained by LMD 4-R. Landscape Maintenance District No.3B—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P283 FH-7 The Foothill boulevard median from Vineyard to Orchard Plaza. Ground Cover area: 2,605 square feet FH-8 The Foothill boulevard median from Orchard Plaza to Lion Street. Ground Cover area: 344 square feet FH-9 The Foothill boulevard median from Hellman to Malachite and from Malachite to Archibald. Ground Cover area: 21,474 square feet FH-10 The Foothill boulevard median from Archibald to Ramona. Ground Cover area: 4,770 square feet FH-11 The Foothill boulevard median from Ramona to Hermosa. Ground Cover area: 5,210 square feet FH-12 The Foothill boulevard median from Hermosa to Center. Ground Cover area: 6,329 square feet FH-13 The Foothill boulevard median from Center to Haven. Ground Cover area: 6,286 square feet FH-14 The Foothill boulevard median from Rochester to 600 feet east of Rochester. Ground Cover area: 1,356 square feet Site reduced to 5,979 square feet due to median renovation. FH-15 The Foothill boulevard median from 1,225 feet west of Day Creek. Ground Cover area: 4,905 square feet FH-16 The Foothill boulevard median from Day Creek to the 15 freeway. Ground Cover area: 9,808 square feet Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No.3B—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P284 bT/£TOZ leaA(eDsij 6 eBuoweDno opuea jo Alit—8£ ON 3pulsia aJueualuiew adeJspuei J Z ""<iiiC. o a s. d cA U 2 W Cc '� 0- W .1 U W Z H Z J Q: W >_ 0 : i — m c ZZ ce Q ry - — a aa.. - U.. ® off likk■-cl dn i I 2 ilia MillW smii. emmr.---Tv:b-E'3 M .J epue.•g3 • 0 II x �_ LL Z e A . _ co 2 L II ry rA CL I I � It/Jeisatpod v s�+ IC) 13 H*a I.!C ii LL? •I:�..Y .tq ,say)oy CO V C II 'co N ; • N C CD LL! _ _ 1 Cr) 7 ny uaYIPW uay116Y si ,....s/1 iy LL �� ; �u w+ I ��O. 2 E _ cu .,u.„kHI LL It udnc-H Q x x 11? N r • Bey,esowiaH yp - ow,aH � ' N MI ti CO "d ple9�4UM — 'le V4'M CI I III,,• AV ueWlaH I r'? -� �r �.uewlldH If a ± rII 2 p e auk LL IS uegawe_i _ fi c • : ci° fio,e .s ZFc;i€^G 8 c yanOJJ :u E5f' •8iEs' Q5 rfi asiG;o m .. , " . 6 o m 2mai«°�.=o2IFCoS CS TS a' "tdg.2z'•'� i.jev: 6 a c Sf.31". ItgtEL4.,Z.ai • .. s€a'ty .3. < cr U E7vu. Efi� 1r3 3 P285 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 269,050.00 Overtime Salaries 2,630.00 Part-time Salaries 42,100.00 Fringe Benefits 132,090.00 Subtotal Personnel $ 445,870.00 Operations and Maintenance Operations and Maintenance $ 59,200.00 Operations and Maintenance/Facilities 0.00 Vehicle Operations and Maintenance 1,500.00 Emergency Equipment and Vehicle Rental 2,000.00 Equipment Operations and Maintenance 12,000.00 Contract Services 410,450.00 Contract Services/Facilities 0.00 Tree Maintenance 21,850.00 Telephone Utilities 0.00 Water Utilities 84,720.00 Electric Utilities 15,490.00 Assessment Administration 6,270.00 General Overhead 59,730.00 Subtotal Operations and Maintenance $ 673,210.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 1,119,080.00 Total Estimated Assessment $ 979,260.00 Less Anticipated Delinquencies (8,350.00) Total Estimated Revenue $ 970,910.00 Plus Operating Reserve Fund Contribution 148,170.00 Total Expenditure Budget $ 1,119,080.00 Total Estimated Assessment $ 979,260.00 Total District EBU Count 2,775.68 Actual Assessment per EBU — Fiscal Year 2013/14 $ 352.80 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 352.80 Landscape Maintenance District No.3B—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P286 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 588,430.00 Operating Reserve Contribution — Fiscal Year 2013/14 (148,170.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 440,260.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Landscape Maintenance District No.3B—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P287 Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No.3B—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P288 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement' (Sec. 22547). Article XIIID, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIIID also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIIID of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No.38—City of Rancho Cucamonga 13 Fiscal Year 2013/14 • P289 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the District and were installed to create a common landscape theme and neighborhood identity for parcels within the District. The improvements are situated within the public rights-of-way of the internal local street network within the District which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the District and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. Landscape Maintenance District No.3B—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P290 When the District was formed in 1979, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units IProperty Type (County Use Code) EBU Value Multiplier Non-Residential 1.00 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Total Total (County Use Code) Assessment Rate Assessment Units/Acres EBUs per EBU Rate per EBU Non-Residential $352.80 $352.80 2,775.68 2,775.68 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No.3B—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P291 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No.3B—City of Rancho Cucamonga 16 Fiscal Year 2013/14 vi/EIO 1eaA'emu P292 LI eSuoweDnD oynueb Jo AiO—8£ ON 1J!J1s!Q a3ueua;u!e J adempue1 W a) M Lo Imo V E co Q , Z^ o k AV A1ayO = i `p� •V J m Q O N W I cti _c 75 3 = i 1° Q 03 i \ Ay ise3 in w i Ay epuenn l3 ny epuenn!l3 CO i V i p9 Naa'o Ikea CI = ny lalsayooa i ny lalsayooa i J ;..: AV ua�!!II!W r_.._.._.._.._._ AV ua)j!II!AJ ny uaneH ny ueneH ny esowlaH KIM ny esowlaH Ay Pleq!4oitl Ay Pleq!4oN ny uewlleH N ny uewllaH (/) L L AV piEAaUTA is ue!lewea 14 iii1;1191 cliiilEtllb 6 , E ix _ Ay OAO10s¢t4 N m O:c y111:2401 6 J gi 75 .c O co leliiiIseZ � P CC c CO � aiiiEi . i w w ccvc `411:1111101!ii 1 z 1 CO !' ._ c; i2!stilts!li P293 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Maximum Property Type Allowable Total Total Allowable (County Use Code) Assessment Rate Units/Acres EBUs Assessment per EBU Non-Residential $352.80 2,775.68 2,775.68 $979,259.90 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. • Landscape Maintenance District No. 3B—City of Rancho Cucamonga 18 Fiscal Year 2013/14 P294 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 4-R (Terra Vista Planned Community) P295 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 4-R (TERRA VISTA PLANNED COMMUNITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P296 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 10 District Budget Definitions of Budget Items Method of Assessment 13 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 17 Assessment Roll 19 Assessment Roll Annexations P297 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13 — 102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 4-R (Terra Vista Planned Community) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 2,548,110.00 Less Anticipated Delinquencies (37,850.00) Total Estimated Revenue $ 2,510,260.00 Less Operating Reserve Collection (181,360.00) Total Expenditure Budget $ 2,328,900.00 Total District EBU Count 6,705.54 Actual Assessment per EBU $ 380.00 Maximum Allowable Assessment per EBU $ 405.60 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P298 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. .Q1/07. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P299 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P300 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. • The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P301 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area located north of Foothill Boulevard, west of Rochester Avenue, east of Haven Avenue, south of Base Line Road and includes the northeast corner of Base Line Road and Haven Avenue. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of the paseos, parkways, median islands, street trees, parks, landscaped sites and appurtenant facilities that are throughout the Terra Vista Planned Community. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest • control, removal of trash/debris, and irrigation of the trees, shrubs, vines; ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Spruce Park, Mountain View Park, Ralph M. Lewis Park, Coyote Canyon Park, Milliken Park and West Greenway Park The street trees within the residential parkways and tree maintenance easements to be maintained by the District are on the following streets, located within the boundaries of the District: Amiata Dr Clarisa PI Danner Ct Bastia Ct Corsica Ct De Anza Dr Blackhorse Ct (Countryview to Milliken) Derby PI Brandywine PI Countryview Downing Ct Bunkerhill Dr (Mt. View to Palacio) Ellena Wy Cedarbrook PI Covington PI (s/o Terra Vista to Chesterton Dr Danbury Dr Fitzpatrick) Landscape Maintenance District No.4-R—City of Rancho Cucamonga 5 Fiscal Year 2013/14 • P302 Emery PI Potomac Ct Terra Vista Pky Fitzpatrick Dr Radcliff PI (Church to Brandywine) Fulbourn Ct Regent Dr Wellington PI Hinton Ct Rockingham Ct Yorktown Ct Linaro Rd Saranza PI Meyers Dr Southhampton Ct The breakdown of maintained areas is as follows: Site # Descriptive Location TV-1 The Base Line median from Haven to the Deer Creek Channel. Ground Cover area: 16,613 square feet Turf area: 19,030 square feet Hardscape area: 10,630 square feet Due to the location of the improvements, an additional 2,769 square feet of ground cover area and 1,478 square feet of turf area of the median are maintained by the City, however that portion is not fnded by the District and instead funded by the City's General Fund. TV-2 The Base Line median from Spruce to the Deer Creek Channel. Ground Cover area: 13,504 square feet Turf area: 16,109 square feet Hardscape area: 12,575 square feet Due to the location of the improvements, an additional 2,749 square feet of ground cover area and 1,598 square feet of turf area of the median are maintained by the City, however that portion is not fnded by the District and instead funded by the City's General Fund. TV-3 The Base Line median from Spruce to Milliken. Ground Cover area: 8,418 square feet Turf area: 13,573 square feet Hardscape area: 16,567 square feet Due to the location of the improvements, an additional 5,247 square feet of ground cover area and 4,289 square feet of turf area of the median are maintained by the City, however that portion is not funded by the District and instead funded by the City's General Fund. TV-4 The south side of Base Line from 800 feet east of Spruce to Milliken. The cul-de-sac at the north end of Cascade. Ground Cover area: 9,278 square feet Turf Cover area: 12,659 square feet Hardscape area: 7,950 square feet TV-5 The north side of Terra Vista Parkway form Belpine to 112 feet west of Butterfield; Terra Vista Parkway median from Spruce to Milliken and the south side of Terra Vista Landscape Maintenance District No.4-R—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P303 Parkway from 164 feet west of Belpine to Belpine. Ground Cover area: 13,411 square feet Turf area: 6,555 square feet Hardscape area: 12,978 square feet TV-6 The north side of Terra Vista Parkway from Spruce to 175 feet north of countryside and Terra Vista Parkway median from Church to Spruce. Ground Cover area: 17,991 square feet Turf area: 11,413 square feet Hardscape area: 11,452 square feet TV-7 The north side of Church from the Deer Creek Channel to Terra Vista Parkway. The west side of Terra Vista Parkway from Church to 175 feet north of Countryside. Ground Cover area: 9,924 square feet Turf area: 5,378 square feet Hardscape area: 6,426 square feet TV-8 The southeast corner of Church and Haven; the Church median from Haven to Terra Vista Parkway and the wash end on the Northwest corner of the Deer Creek Channel and Church. Ground Cover area: 26,876 square feet Hardscape area: 2,306 square feet Hardscape area: 2,788 square feet TV-9 The Church median from Terra Vista Parkway to Elm. Ground Cover area: 7,829 square feet Hardscape area: 6,605 square feet TV-10 The east side of Valencia from Base Line to the pre-school; the south side of Augusta from Valencia to Meadow Lark and the west side of Summerfield from Valencia to Evergreen. Ground Cover area: 20,818 square feet Turf area: 18,634 square feet Hardscape area: 8,666 square feet TV-11 The paseo at Parkside and Clover from Parkside to the Deer Creek Channel. Ground Cover area: 2,795 square feet Hardscape area: 1,049 square feet TV-12 The east side of Haven from the pre-school to the Southern Pacific Railroad. Ground Cover area: 6,170 square feet Turf area: 2,091 square feet Hardscape area: 1,060 square feet Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P304 TV-13 The east side of Spruce from Elm to Mountain View; the north and south sides of Norfolk from Spruce to Cardiff; the south side of Mountain View from Spruce to 290 feet east of Belvedere and the paseo from Spruce to Countryview. Ground Cover area: 8,459 square feet Turf area: 3,355 square feet Hardscape area: 8,886 square feet TV-14 The south side of Mountain View from 290 feet east of Belvedere to 590 feet east of Fairhaven; the paseo south of Mountain View between Belvedere and Fairhaven to Country View and from Countryview Drive to West Greenway Corridor. Ground Cover area: 19,030 square feet Turf area: 8,430 square feet Hardscape area: 9,262 square feet TV-15 The north side of Mountain View from 634 feet west of Biarritz to Milliken. Ground Cover area: 4,571 square feet Turf area: 4,738 square feet Hardscape area: 5,104 square feet TV-16 The west Greenway Corridor form the northeast corner of Elm and Spruce to West Greenway. Ground Cover area: 15,529 square feet Turf area: 20,884 square feet Hardscape area: 20,626 square feet TV-17 The west side of Milliken from 585 feet north of Mountain View to Mountain View. Ground Cover area: 5,835 square feet Turf area: 3,564 square feet Hardscape area: 2,340 square feet TV-18 The south side of Mountain View from approximately 250 feet west of Claridge to Terra Vista Parkway. The south side of Terra Vista Parkway from Mountain View to East Greenway Corridor. Terra Vista Parkway from Mountain View to East Greenway Corridor. Ground Cover area: 18,316 square feet Turf area: 5,944 square feet Hardscape area: 23,800 square feet TV-19 The Terra Vista Parkway median from Milliken to Mountain View. The north side of Terra Vista Parkway from 68 feet north of Addison to Mountain View. The west side of Mountain View from Grapevine to Terra Vista Parkway. Ground Cover area: 20,306 square feet Turf area: 3,886 square feet Hardscape area: 11,478 square feet Landscape Maintenance District No.4-R—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P305 TV-20 The Church median from Milliken to 675 feet east of Milliken. Ground Cover area: 2,860 square feet Hardscape area: 2,112 square feet TV-21 The Church median from Milliken to Spruce. Ground Cover area: 16,811 square feet Turf area: 335 square feet Hardscape area: 14,880 square feet TV-22 The Milliken median from Mountain View to Foothill. Ground Cover area: 16,436 square feet Hardscape area: 16,267 square feet TV-23 The Milliken underpass from West Greenway Park to Milliken Park. Ground Cover area: 19,271 square feet Turf area: 22,139 square feet Hardscape area: 18,119 square feet TV-24 The east side of Haven from 145 feet south of Creekbridge to 600 feet north of Creekbridge; the north side of Creekbridge from Brookside to Haven and the paseo from Creekbridge and Brookside to the Deer Creek Channel. Ground Cover area: 5,851 square feet Turf area: 9,965 square feet Hardscape area: 4,351 square feet TV-25 The east side of Haven form 145 feet south of Creekbridge to 410 feet south of Creekbridge. Ground Cover area: 3,319 square feet Turf area: 1,677 square feet Hardscape area: 1,779 square feet TV-26 The paseo at Plymouth south of Essex from Plymouth to the Deer Creek Channel. Ground Cover area: 1,956 square feet Hardscape area: 2,385 square feet TV-27 The paseo from Terra Vista Parkway to Windsong and from Windsong to Plymouth. Ground Cover area: 2,270 square feet Turf area: 2,731 square feet Hardscape area: 3,332.square feet TV-28 The paseo at 7552 Hardy. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P306 Ground Cover area: 630 square feet Turf area: 733 square feet Hardscape area: 432 square feet TV-29 The East Greenway Corridor from Milliken Park to Terra Vista Parkway, including the turf area at the entrance to Tract 16157. Ground Cover area: 17,780 square feet Turf area: 52,403 square feet Hardscape area: 29,888 square feet TV-30 The Milliken Median from Mountain View to Base Line. Ground Cover area: 11,890 square feet Hardscape area: 10,260 square feet TV-31 The paseo from Elm to West Greenway Park. Ground Cover area: 4,770 square feet Hardscape area: 8,900 square feet TV-32 The Greenwich paseo from Greenwich to Muirfield. Ground Cover area: 1,323 square feet Hardscape area: 1,456 square feet TV-33 The south side of Mountain View from 430 feet west of Country View to Country View. Ground Cover area: 3,434 square feet Turf area: 1,853 square feet Hardscape area: 1,720 square feet TV-34 The south side of Terra Vista Parkway from 390 feet west of Belpine to Belpine. Ground Cover area: 1,342 square feet Turf area: 1,887 square feet Hardscape area: 1,612 square feet TV-35 The Trail Northeast of Ruth Musser School from Terra Vista Parkway to Spruce. Ground Cover area: 9,285 square feet Hardscape area: 5,148 square feet TV-36 The north side of Meyers from Emery Place to Elm. Ground Cover area: 9,141 square feet Turf area: 5,895 square feet Hardscape area: 6,058 square feet TV-37 The north side of Meyers from Emery Place to Elm. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P307 Ground Cover area: 5,860 square feet Turf area: 5,300 square feet Hardscape area: 1,283 square feet TV-38 The Church median from Rochester to Terra Vista Parkway median from Church to 853 feet north of Church. Ground Cover area: 8,510 square feet Hardscape area: 5,640 square feet TV-39 The north side of Mountain View form 250 feet east of Milliken to Milliken. The east side of Milliken from Mountain View to Terra Vista Parkway. Ground Cover area: 16,751 square feet Hardscape area: 15,716 square feet TV-40 The south side of Terra Vista Parkway from Milliken to Mountain View. Ground Cover area: 11,630 square feet Hardscape area: 19,738 square feet TV-41 The south side of Terra Vista Parkway from Milliken to Mountain View. Ground Cover area: 4,081 square feet Hardscape area: 9,640 square feet TV-42 The north side of Mountain View from Terra Vista Parkway to 250 feet east of Milliken. Ground Cover area: 10,994 square feet Hardscape area: 14,777 square feet TV-43 Church median and parkway from Malaga to Terra Vista Parkway. Ground Cover area: 7,506 square feet Hardscape area: 3,955 square feet • TV-44 The south side of Church from Terra Vista Parkway to Rochester. Ground Cover area: 10,400 square feet Hardscape area: 7,606 square feet TV-45 The west side of Rochester from Church to Malaga. Ground cover area: 20,693 square feet Hardscape area: 12,450 square feet TV-46 The north side of Malaga from Church to Rochester. Ground Cover area: 19,843 square feet Hardscape area: 18,000 square feet Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P308 TV-47 The east side of Terra Vista Parkway from Church to Brandywine. The paseo from Brandywine to Bunker Hill Drive. The east side of Radcliff from Bunker to Malada. Ground Cover area: 17,838 square feet Hardscape area: 9,023 square feet TV-48 The Church median from 750 feet east of Milliken to Malaga Ave. Ground Cover area: 5,554 square feet Hardscape area: 9,698 square feet FH-1 The Foothill median from Spruce to Haven. Ground Cover area: 4,571 square feet The total square footage for the improvement is 9,141; however, due to the location of the improvement the other half is maintained by LMD 3B. FH-2 The Foothill median from Spruce to Haven. Ground Cover area: 7,940 square feet The total square footage for the improvement is 15,879; however, due to the location of the improvement the other half is maintained by LMD 3B. FH-5 The Foothill median from 360 feet west of Masi Dr to 516 feet west of Masi Dr. Ground Cover area: 800 square feet The total square footage for the improvement is 1,600; however, due to the location of the improvement the other half is maintained by LMD 3B. FH-6 The Foothill median form Masi Plaza to Rochester. Ground Cover area: 800 square feet The total square footage for the improvement is 1,600; however, due to the location of the improvement the other half is maintained by LMD 3B. H-5 The Haven median form Foothill to Church. Ground Cover area: 11,502 square feet 3/25/13: Converted 10,572 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 4R. An equal amount is maintained by LMD 3B. H-6 Haven median form Church to Baseline. Ground Cover area: 9,660 square feet 3/25/13: Converted 8,708 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 4R. An equal amount is maintained by the General Fund. H-7 The Haven median from Baseline to Southern Pacific railroad tracks. Ground Cover area: 4,976 square feet 3/25/13: Converted 3,992 sq ft of turf to ground cover effective 4/1/13. Area listed is the 50% maintained by LMD 4R. An equal amount is maintained by the General Fund. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P309 VG-14 The Baseline median from Milliken to Ellena East. The turf and ground cover on the north side of Baseline from Ellena East to Ellena West. The turf and ground cover on the east side of Ellena West from Baseline and following the curb line to Kenyon. The north side of Ellena West from Kenyon to Casoli. The turf and ground cover on both sides of Casoli from Ellena West to Candela. The turf and ground cover on both sides of Crema Place from Ellena west to Candela. Ground Cover area: 9,169 square feet The total square footage for the Ground Cover improvements are 80,287, 62,999 square feet for Turf and 44,826 square feet for Hardscape; however, due to the location of the improvements, LMD 4-R maintains only the south side of the Base Line median from Milliken to Ellena East and the rest is maintained by LMD 2. VG-15 The turf and ground cover on the west side of Rochester from the Southern Pacific Railroad to Baseline. The turf and ground cover on the north side of Baseline from Rochester to Ellena East. The Baseline Median from Rochester to Ellena East. The turf and ground cover on the east side of Ellena east from Baseline and continuing along that curb line to 275 feet north of Berra Road. The turf and ground cover on both sides of Berra from Ellena East to Comiso. Ground Cover area: 3,960 square feet The total square footage for the Ground Cover improvements are 58,5887, 57,306 square feet for Turf and 36,014 square feet for Hardscape; however, due to the location of the improvements, LMD 4-R maintains only the south side of the Base Line median from Rochester to Ellena East and the rest is maintained by LMD 2. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P310 VT/ETOZ.IeaA leJs1 J 6 auowe3n) oyaued Jo Ai j—a V oN PuTsiG aJueuaTuiew adempuei 6 P? W Z w z Z o rz p- (o cc r F V c cc a + rf r LL w a •—o.` , A 231S3W�0 �,1 a .e o $ w g S '& ifC E ff cX v <> * 1 Nal I 0 1 3 d Au, a O S x z a z $ N N a) co ommommumor N CC 1 O 4 g z O O O Z 6 O 'mom .- u, O d *„ AV N3)41111161 717--, ,;, N G> > O )ri.................%;> M 4-. o W O Q w O N Q) w Q. ✓ O sl \* L in N O V o o ' n OLL ...—.— ...A Fr— 11:1311 ' v, u O E• ss�o`�SS"Ua=f° a tea. � O Cu'�ESg7Sal.t1.%5; ao FFF 121q �3 ii ;vol0E, ill €aar� '�an ?u YS� N G"e E;;:is:i 2, 2 O O ..,.&t....s,...ear O :ave;o9�_°�€1:�40 ...i,x;_.iv_.:2E, of 221 = -E 1 ' N irni EFL€€R 4€oi AVN3AVH x x P311 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 269,050.00 Overtime Salaries 2,630.00 Part-time Salaries 42,100.00 Fringe Benefits 132,090.00 Subtotal Personnel $ 445,870.00 Operations and Maintenance Operations and Maintenance $ 59,200.00 Operations and Maintenance/Facilities 0.00 Vehicle Operations and Maintenance 1,500.00 Emergency Equipment and Vehicle Rental 2,000.00 Equipment Operations and Maintenance 12,000.00 Contract Services 410,450.00 Contract Services/Facilities 0.00 Tree Maintenance 21,850.00 Telephone Utilities 0.00 Water Utilities 84,720.00 Electric Utilities 15,490.00 Assessment Administration 6,270.00 General Overhead 59,730.00 Subtotal Operations and Maintenance $ 673,210.00 Capital Expenditures Capital Proiects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total Expenditure Budget $ 1,119,080.00 Total Estimated Assessment $ 979,260.00 Less Anticipated Delinquencies (8,350.00) Total Estimated Revenue $ 970,910.00 Plus Operating Reserve Fund Contribution 148,170.00 Total Expenditure Budget $ 1,119,080.00 Total Estimated Assessment $ 979,260.00 Total District EBU Count 2,775.68 Actual Assessment per EBU —Fiscal Year 2013/14 $ 352.80 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 352.80 Landscape Maintenance District No.3B—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P312 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved when the property owners on December 2, 2009, voted in favor of a Prop 218 assessment ballot increase with an allowable annual increase by the lesser of 3.5% or the percentage change in the year ending February preceding the start of the Fiscal Year of the Consumer Price Index for all Urban Consumers (CPI-U) and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 2,540,100.00 Operating Reserve Contribution — Fiscal Year 2013/14 (0.00) Operating Reserve Collection — Fiscal Year 2013/14 181,360.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 2,721,460.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P313 Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later..The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P314 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P315 • In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the Caryn Planned Community and were installed to create a common landscape theme and neighborhood identity for parcels within the Caryn Planned Community. The improvements are situated within the public rights-of-way of the internal local street network within the Caryn Planned Community which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit Landscape Maintenance District No.4-R—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P316 derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1984, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined. On December 2, 2009 Proposition 218 assessment ballot increase was approved by the property owners in this district. Therefore, all parcels included in the District boundary, are being levied in accordance with Article XIII D and Proposition 218. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use}, and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. • Land-Use Equivalent Benefit Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Benefit Unit Condominium 0.80 Benefit Unit Multi-Family 0.70 Benefit Unit Commercial/Industrial 3.25 Acre Vacant (incl. all undeveloped property) 0.25 Acre Schools 0.25 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table reflects both the maximum allowable assessment and the actual assessment rates for each year since the formation of the district and the proposed assessment for Fiscal Year 2013/14 for the District: Fiscal Year Maximum Assessment per EBU Actual Assessment per EBU 2010/11 380.00 380.00 2011/12 388.64 380.00 2012/13 396.77 380.00 2013/14 405.60 380.00 Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P317 Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $405.60 $380.00 2,652.00 2,652.00 Condominium $405.60 $380.00 1,395.00 1,116.00 Multi-Family $405.60 $380.00 3,331.00 2,331.70 Commercial/Industrial $405.60 $380.00 _ 176.28 572.91 Vacant $405.60 $380.00 96.30 24.08 Schools $405.60 $380.00 35.41 8.85 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Cost of Living Inflator Each fiscal year beginning Fiscal Year 2010/11, the maximum allowable assessment amount may be increased by the lesser of 3.5% or the percentage change in the year ending February preceding the start of the Fiscal Year of the Consumer Price Index for all Urban Consumers (CPI-U), for the Los Angeles-Riverside-Orange County area. If for any reason the percentage change is negative the maximum allowable assessment would not be decreased by reason of such negative percentage change and would remain at the amount as computed on the previous fiscal year regardless of any CPI adjustment. The annual assessment cannot exceed the actual costs to operate the District in any given year. If operating costs are such that the maximum assessment amount is not needed, the City would levy only what is needed for that year. The assessment rate for Fiscal Year 2013/14 will not increase. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P318 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No.4-R—City of Rancho Cucamonga 17 Fiscal Year 2013/14 bL/£LOZ.JeaA leos!d P319 81 e2uoweonjoyoueajoAl!O—N-V 'ON 1a!J1s!Qaoueualu!ewadeospuei •i N 4 C) Se Q'` - tC J to C -0 T A 0 C 0 _ N \I ny Ai�aya U �J QI0 ki .g c N li in 0 � � J o C `1\ — .l m o — 3 C) 10 0 O Y/ { m r.r ! u_ Q "_ I B .... �^V ise3 v1 !i i C Q 1I.�L)IOOJO epuerl3 /I ny epuem!13 1:1 V ea C ny.ialsayooa A AV iaisayooa J l my ua�!II!W I AV uOH!II!W I AV USABH I ,' AV uaneH AV esOWJaH t AV esowteH ^y ple9!goJv I ^y pleQ!yoty AV uewl!aH I N ny uewlIOH u) r AV peAawn is ue!lawea I / f IIi(( t^l L t it tivi�t - C_.� 9itt:111!181 �' ` AV 0A0.10 1 �j:at w 2 m E in f,t tif•tt —1t — ! 1�'7..__� S°i a, t o z liir lifi{• F �°, m g Q lti$igi$,tfili[ 2 i 1' �jt • &. ?3 = ill itl�(t(i� I J of fuu,j.3F iti wilt? :iti P320 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $405.60 2,652.00 2,652.00 $1,075,651.20 Condominium $405.60 1,395.00 1,116.00 $452,649.60 Multi-Family $405.60 3,331.00 2331.70 $945,737.52 Commercial/Industrial $405.60 176.28 572.91 $232,372.30 Vacant $405.60 96.30 24.08 $9,766.85 Schools $405.60 35.41 8.85 $3,589.56 TOTALS 7,685.99 6,705.54 $2,719,767.03 Actual Actual Property Type Assessment Rate Total Total Allowable (County Use Code) per Units/Acres EBUs Assessment Single Family Residential $380.00 2,652.00 2,652.00 $1,007,760.00 Condominium $380.00 1,395.00 1,116.00 $424,080.00 Multi-Family $380.00 3,331.00 2,331.70 $886.046.00 Commercial/Industrial $380.00 176.28 572.91 $217,705.80 _Vacant $380.00 96.30 24.08 $9,148.50 Schools $380.00 35.41 8.85 $3,363.95 TOTALS 7,685.99 6,705.54 $2,548,104.25 A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No. 4-R—City of Rancho Cucamonga 19 Fiscal Year 2013/14 P321 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 5 (Tot Lot) P322 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 5 (TOT LOT) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P323 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 7 District Budget Definitions of Budget Items Method of Assessment 10 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 13 Assessment Roll 15 Assessment Roll Annexations • P324 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13 — 102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 5 (Tot Lot) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 2,490.00 Plus Anticipated Delinquencies 850.00 Total Estimated Revenue $ 3,340.00 Plus Reserve Fund Contribution 1,990.00 Total Expenditure Budget $ 5,330.00 Total District EBU Count 44.00 Actual Assessment per EBU $ 56.65 Maximum Allowable Assessment per EBU $ 113.29 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 5—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P325 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. • Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 5—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P326 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of water for the irrigation of landscaping, the furnishing of electricity, gas or other illuminating energy for the lighting of landscaping or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 5—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P327 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 5—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P328 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City bounded by Hermosa Avenue on the west, 26"' Avenue on the south, the parcels north of and along Bedford Drive and the parcels west of and along Andover Place. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Tot Lot. Site# Descriptive Location 1-1-5 The tot lot on the southwest corner of Andover and Bedford. Ground Cover area: 1,506 square feet Turf area: 1,070 square feet Hardscape area: 640 square feet Tot Lot and landscaping are maintained by the City's Park Maintenance Crews. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 5—City of Rancho Cucamonga 5 Fiscal Year 2013/14 bT/£TOZ ieaA I eD s P329 u g e2uoweonD oq uea Jo AIDS—s •oN P!Tsia aoueua;uiew adeDspuei —r-- r— r - - -- — — a Z w r — _. w a U J w _ Z Z w w w y in O w 1, \ \; w -- L___ _____i - J 1 '\ �\F — g Q. = CL -J 2 u_ Q_ o ® IIIO I I -- • , ___ _ ___ __ __. r I -I--I Z —_ p _ V 0 li f I ii 0 w CO C C - ----- / ' I —; -- - ---- --- t0 d / -- J Sr li d __— __ r.__ _ — N • a 1 1 - - . -- --- -� o - - I - I 33 -I - 1 V — lI f/� \ 1 r i AVVSOWa3H I --'— --- - --;- - - -� ..---- --- - - 1 �' :0g111= R 1 2321 Fy=aie�Z •- G':as 4ae.- S �j �,E uaigelia .� —__—�_ _-. ._ _ .� __ _�. ___�J S1^ia.EF=esl$p rigt q: Sic:-.02 Qa1Csa .ii :3° .s�.�b oZ� - 'aS. �aE€;a°l= v. : s 5: 341 s Iii4gialie Ha 1e W - - - 1 - U I I gla nss°da331Ey 1 1 I Fl P330 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 0.00 Part-time Salaries 0.00 Fringe Benefits 0.00 Subtotal Personnel $ 0.00 Operations and Maintenance Operations and Maintenance $ 1,100.00 Vehicle Operations and Maintenance 70.00 Contract Services 2,690.00 Utilities Water Utilities 630.00 Electric Utilities 320.00 Assessment Administration 220.00 General Overhead 300.00 Subtotal Operations and Maintenance $ 5,330.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 5,330.00 Total Estimated Assessment $ 2,490.00 Plus Anticipated Delinquency 850.00 Total Estimated Revenues $ 3,340.00 Plus Operating Reserve Fund Contribution 1.990.00 Total Expenditure Budget $ 5,330.00 Total Estimated Assessment $ 2,490.00 Total District EBU Count 44.00 Actual Assessment per EBU — Fiscal Year 2013/14 $ 56.65 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 113.29 The maximum allowable assessment per EBU listed in the District budget above, is"the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual Landscape Maintenance District No. 5—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P331 • assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to • December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 80,930.00 Operating Reserve Contribution — Fiscal Year 2013/14 (1,990.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 78,940.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. • Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Landscape Maintenance District No. 5—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P332 Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 5—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P333 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) (of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement' (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 5—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P334 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the Caryn Planned Community and were installed to create a common landscape theme and neighborhood identity for parcels within the Caryn Planned Community. The improvements are situated within the public rights-of-way of the internal local street network within the Caryn Planned Community which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit Landscape Maintenance District No. 5—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P335 derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1984, Article XIII D and Proposition 218 had not yet been passed. Upon the passage of Article XIII D and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined. On December 2, 2009 Proposition 218 assessment ballot increase was approved by the property owners in this district. Therefore, all parcels included in the District boundary, are being levied in accordance with Article XIII D and Proposition 218. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use}, and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units IProperty Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Dwelling Unit The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $113.29 $56.65 44 44 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No. 5—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P336 The Fiscal Year 2013/14 actual assessment rate is reduced from the prior year due to the City having reserve funds that are more than sufficient to cover an estimated six months' worth of maintenance and servicing costs for the District. When there are excess funds in the District's reserve account, the excess can be used to lower the annual levy to property owners within the District. The City will continue to annually review the estimated costs and expenses for the District as well as reserve fund levels, in order to determine if future levies can be reduced as well. Landscape Maintenance District No. 5—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P337 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. S—City of Rancho Cucamonga 14 Fiscal Year 2013/14 bT/£TOZ JeaA leos!j P338 5T e8uoweono oywea;o A4!3-5 'ON iouis!Q aoueuaiuie AJ adeospue- 10 ✓ -i i, .0 g ul 0 >1%, J v CD b1 c 0 0 744 Ay A,p0143 N C co `!� d N C CD i' �'r S J m O yr ' c t .S. m O i `\ - LL Q litti V isea iA D 0 Q I Ay epuenn!iar——I �� I ;E- . ny epuem!13 CO 0 I s ay`+ lig I�p —�) CO Ayiaisayoob I— t — AV iaisayooa -h I +Ay uwl!I! V r--..--"T's { ` AV uam!II!W I AV uaneH \ � — — —`IAV uaneH Ay eSOwlOH _1 •1 ■ 1 Inv esoWAaH ^V PIe9!4oPV --- I ill- — nV PIe9!4aiV AV uewpaH I _—I— - - -ny uewllaH .c C � Inv pJeAau!A lS ue!�awe� I — 1 r� i I ffifilqpii -I mina • .°. AV 0n010 a E Cs ro I' I fiat!!! En L i i #Y� m 0 Q 012111E:`1a1 CC c CO u_ 0 l,pyii€;IE:i Oi m 1.11 1•• ! Iir iiiii is C}'� t i$flaiS;tiii a I:t zi �T� 4 �## i p U !id.finhii P339 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $113.29 44 44 $4,984.76 Actual Property Type Assessment Rate Total Total Actual (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $56.65 44 44 $2,492.60 A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no Annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No. 5—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P340 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 6-R (Caryn Planned Community) P341 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 6 (CARYN PLANNED COMMUNITY) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P342 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 6 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 23 District Budget Definitions of Budget Items Method of Assessment 26 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 30 Assessment Roll 32 Assessment Roll Annexations P343 ENGINEER'S LETTER WHEREAS, on July 3, 2013 the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 6 (Caryn Planned Community) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $467,600.00 Plus Anticipated Delinquencies 5.040.00 Total Estimated Revenue $472,640.00 Less Reserve Fund Collection (5,240.00) Total Expenditure Budget $467,400.00 Total District EBU Count 1,196.98 Actual Assessment per EBU $390.65 Maximum Allowable Assessment per EBU $390.65 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P344 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P345 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P346 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P347 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga. The boundaries of the District are generally described as that area located north of the 1-210 Freeway, south of Banyan Street, west of Rochester Avenue and east of Milliken Avenue, also known as the Caryn Planned Community. The boundaries also include Tract No. 13835 east of Rochester Avenue and Tracts No. 13748, 13857 & 13858 west of Milliken Avenue. Zone 1 is the area generally located west of Rochester Avenue and east of Milliken Avenue. Zone 2 is the area generally located east of Rochester Avenue and west of Milliken Avenue. Description of Improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout the Caryn Planned Community. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Site# Descriptive Location CC-1 The southside of Banyan St from 1290 feet west of Milliken to Milliken. The west side of Milliken & median from Banyan St to 292 south of Vintage Dr. Ground Cover area: 96,892 square feet Turf area: 17,945 square feet Hardscape area: 13,944 square feet CC-3 The paseo on the west side of Morning PI form Morning PI to Deer Creek Channel. Ground Cover area: 2,8W square feet Turf area: 124 square feet Hardscape area: 4,609 square feet Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P348 CC-4 The west side of Morning PI, from Banyan St to Starview PI. The north side of Starview PI, from Morning PI to Star View Ct. Ground Cover area: 14,273 square feet Turf Cover area: 5,513 square feet Hardscape area: 5,000 square feet CC-5 Silver Sun paseo from the end of Silver Sun cul-de-sac to Deer Creek Channel. Ground Cover area: 25,890 square feet Turf area: 12,084 square feet Hardscape area: 1,350 square feet CC-6 The east and west side of Netherlands View Loop from vintage Dr. to Vintage Dr. The Netherlands View loop paseo from Netherlands View Loop to Mt Sterling Ct. Ground Cover area: 88,902 square feet Turf area: 676 square feet Hardscape area: 23,650 square feet CC-7 The east and west side of Hillview Loop from Mt. Rainer Ct to Kettle Peak. Ground Cover area: 14,930 square feet Turf area: 6,318 square feet Hardscape area: 12,236 square feet CC-8 The paseo from Hillview Loop to Vintage Dr. Ground Cover area: 42,107 square feet Hardscape area: 22,752 square feet Hardscape area: 4,089 square feet CC-9 The south side of Vintage Dr. from 250 feet west of Hillview Loop to Hillview Loop. The west side of Hillview Loop from Vintage Dr. to Kettle Peak. The west side of Kettle Peak from Hillview Loop to Donner Pass Ct. The east side of Hillview Loop from Kettle Peak to Tioga Peak. Ground Cover area: 47,334 square feet Turf area: 4,954 square feet Hardscape area: 9,088 square feet CC-10 The east side of Terrace View Loop from Vintage Dr. to Butler Peak. The west side of Terrace View Loop from Rainbow Falls Ct. Vintage Dr. Ground Cover area: 24,603 square feet Hardscape area: 10,760 square feet CC-11 The paseo from Caryn School to Banyan St. The south side of Banyan St from the paseo to Rochester Ave. The east and west side of Mt. Baldy Ct from Banyan St to Sierra Crest View Loop. The north side of Sierra Crest View Loop from Hilltop Ct. to Woodland Ct. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P349 Ground Cover area: 47,507 square feet Turf area: 7,810 square feet Hardscape area: 7,825 square feet CC-12 The Separation Paseo from Vintage Dr to Pinnacle Peak. Ground Cover area: 50,325 square feet Turf area: 15,021 square feet Hardscape area: 7,675 square feet CC-13 The east side of Hillview Loop from Tioga Peak Ct to Vintage Dr. The south side of Vintage Dr from Hillview Loop to Terrace View Loop. The north side of Vintage Dr from Hillview Loop to Caryn School. The east side of Terrace View Loop from Vintage Dr to Mt San Antonio Ct. Ground Cover area: 26,162 square feet Turf area: 4,508 square feet Hardscape area: 12,928 square feet CC-14 The east side of Sierra Crest View Loop from Mt. Waverly to Vintage Dr. The north side of Vintage Dr. from Sierra Crest View Loop to Sierra Crest View Loop. The east and west side of Sierra Crest View Loop from Vintage Dr. to Mt. Wilson Ct. The south side of Vintage Dr. from Netherlands View Loop to 330 feet west of Netherlands View Loop. Ground Cover area: 73,250 square feet Turf area: 16,525 square feet Hardscape area: 9,885 square feet CC-15 The south side of Sierra Crest View Loop from Mt. Waverly Ct. to Mt. Cambridge Ct. The north side of Sierra Crest View Loop from Mt. Cambridge Ct. to Woodland Ct. The north side of Sierra Crest View Loop from Hilltop Ct. to Caryn School. The Sierra Crest view Loop paseo from Sierra Crest View Loop to Mt. Sherman Ct. Ground Cover area: 70,990 square feet Turf area: 7,699 square feet Hardscape area: 20,055 square feet CC-16 The south side of Vintage Dr. from Netherlands View Loop to Rochester Ave. The north side of Vintage Dr. from Rochester Ave. to Sierra Crest View Loop. The east and west side of Sierra Crest View Loop from Mt. Wilson Ct. to Mt. Cambridge Ct. The Netherlands View Loop Paseo from Vintage Dr. to Mt. Sterling Ct. Ground Cover area: 77,202 square feet Turf area: 3,954 square feet Hardscape area: 18,195 square feet CC-17 The east side of Milliken Ave. from Vintage Dr. to Banyan St. Ground Cover area: 13,740 square feet Turf area: 9,088 square feet Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P350 Hardscape area: 6,460 square feet CC-18 The north side of Vintage Dr. from Milliken Ave. to Hillview Loop. The south side of Vintage Dr. from 104 feet west of Hillview Loop to Milliken Ave. Ground Cover area: 32,287 square feet Turf area: 3,889 square feet Hardscape area: 11,188 square feet CC-19 The Terrace View Loop paseo from Vintage Dr. to Terrace View Loop. Ground Cover area: 17,469 square feet Turf area: 15,617 square feet Hardscape area: 2,736 square feet CC-20 The east side of Terrace View Loop from Mt. San Antonio Ct. to El Capitan Ct. The west side of Terrace View Loop from Butler Peak PI. to Mt. San Antonio Ct. Ground Cover area: 20,627 square feet Hardscape area: 20,017 square feet Hardscape area: 7,888 square feet CC-21 The west side of Rochester from Banyan to 317 feet south of Vintage Dr. Ground Cover area: 31,292 square feet CC-22 The south side of Vintage Dr. from Terrace View Loop to Sierra Crest View Loop. The east and west side of Hillview Loop from Vintage Dr. to Mt. Rainer Ct. Ground Cover area: 11,609 square feet Turf area: 3,763 square feet Hardscape area: 6,524 square feet CC-23 The south side of Banyan from Milliken to Butler Peak Pl. The west side of Butler Peak PI. from Banyan St. to Terrace View Loop. The north isde of Terrace View Loop from Butler Peak PI. to Rainbow Falls Ct. Ground Cover area: 12,132 square feet Hardscape area: 528 square feet CC-24 The north side of Terrace View Loop from El Capitan Ct. to Butler Peak PI. The east side of Butler Peak Pl. from Terrace View Loop to Banyan St. The south side of Banyan St. from Butler Peak Pl. to 990 feet east of Butler Peak PI. Ground Cover area: 14,452 square feet Hardscape area: 1,600 square feet CC-26 The east side of Rochester from 210 freeway to Vintage Dr. The north and south side of Vintage from Rochester to Thunder Mountain Ct. The west side of Rochester from 317 feet south of Vintage Dr. to the 210 freeway. Ground Cover area: 35,037 square feet Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P351 Hardscape area: 19,779 square feet CC-27 The Milliken median and the west side of Milliken from 292 feet south of Vintage to 210 freeway. Ground Cover area: 13,365 square feet Hardscape area: 12,300 square feet CC-28 The east side of Milliken from Vintage to the 210 freeway right-of-way. Ground Cover area: 17,724 square feet Hardscape area: 8,197 square feet Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 9 Fiscal Year 2013/14 bT/ETOZ JeaA leasij P352 OT eSuoweDn0 oipuej Jo Alp—a-9 -oN PPITsid aaueuaau!ew adeJspuei a Zz W � t0 11J O O � L03- N J N �U w < g 6 O C° U w c6 1 -/.1t1�31iS3Ho-OLI j —mph \ Ct up 1 I Z U _Lc) o 2 NT+J 1- c� Jf - ° 1m 0 Cil co c ..,.....">- v M Z � co CD 4-a V = U a I ' .."1".4"711_4 O N +1 t O U O 0 M U U 0 • c 0 cl. N— "in.."....bals"..- \41%.414116� <>Q) c.....<>0) cc O U Q U 0 U ` O , U o O �/+ aro'le!)i O az N N 00 U N U U C O 1...._<> J —AHVNANIi■IIW— O O O 8- _ 2 U U ti N mc'a Er . O U U U _, g O.A C d T 12 L 3 y a U m N. J 0 O 4- . C .0 a .0 a-= a C1 N 0 D y ' 111844 .0. C4 `t 0 3 ' ...7 N∎ w E S m r �0 o F=$ ; a A u rn m m E -a P m 'a m a q m � C O F m of c 2N U m a, T C q C m E C O C yt F A N C uv :0,3 . - = N 0 - a 6 = E tD, E ° H 0 o 5"-a, >,2 o .n m o a c c £ L h a 8 u w E ma„ �A U rn C m E n b °m n j o a 0,Q c m - O - m c m a t) noYVvc0 m 0 1 +V 0 -t V Ec U m N d N 0 0 _ E ? 2 O f_ U c 2 C 0 A D ,_ _ o D 4.CC 0-p 0_,2 w p o A W E! 3 R ' 1= C ,U N C yl C j 4 L• a m F m a yQ 2 O Q w N« d la D T u o c F' A ;a F 3 41 a.C F`C £N U A O N P353 • ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 7,490.00 Part-time Salaries 0.00 Fringe Benefits 3.520.00 Subtotal Personnel $ 11,010.00 Operations and Maintenance Operations and Maintenance $ 16,060.00 Emergency Equipment & Vehicle Rental 200.00 Contract Services 285,490.00 Tree Maintenance 16,870.00 Utilities Water Utilities 100,260.00 Electric Utilities 8,310.00 Assessment Administration 7,020.00 General Overhead 22.180.00 Subtotal Operations and Maintenance $ 456,390.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 467,400.00 Total Estimated Assessment $ 467,600.00 Plus Anticipated Revenue From Past Delinquencies 5.040.00 Total Estimated Revenues $ 472,640.00 Less Reserve Fund Collection (5,240.00) Total Expenditure Budget $ 467,400.00 Total Estimated Assessment $ 467,600.00 Total District EBU Count 1,196.98 Actual Assessment per EBU — Fiscal Year 2013/14 $ 390.65 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 390.65 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved when the property owners on December 2, 2009, voted in favor of a Prop 218 assessment ballot increase with an allowable annual increase by the lesser of 3.5% or the Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P354 percentage change in the year ending February preceding the start of the Fiscal Year of the Consumer Price Index for all Urban Consumers (CPI-U) and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 173,710.00 Operating Reserve Contribution — Fiscal Year 2013/14 (0.00) Operating Reserve Collection — Fiscal Year 2013/14 5.240.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 178,950.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P355 Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P356 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P357 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the Caryn Planned Community and were installed to create a common landscape theme and neighborhood identity for parcels within the Caryn Planned Community. The improvements are situated within the public rights-of-way of the internal local street network within the Caryn Planned Community which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P358 derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Dwelling Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. Vacant parcels are assigned an EBU value of 0.25 EBU's per acre because they receive a lesser benefit from the improvements until such time as development occurs. Publicly owned school parcels are also assigned an EBU value of 0.25 EBU's per acre in recognition of the limited benefit they receive from the improvements which are provided for the use and benefit of the residential units within the District, and the benefit conferred upon other parcels within the District by the open space and landscaping maintained by the School District on their parcels which might be used by properties within the District under joint use agreements between the School District and the City. There are two benefit zones within the District: Zone 1 and Zone 2. Parcels in Zone 2 are assigned 0.75 EBU per dwelling unit due to the reduction in special benefit they receive as a result of their location relative to the majority of the improvements maintained by the District. Zone 2 parcels are on the far east and west side of the District. Therefore, parcels within Zone 2 do not receive the same special benefit from the improvements due to their proximity, as parcels within Zone lwhich are assigned 1.00 EBU per dwelling unit and are generally located adjacent to or in close proximity to the improvements. The following table provides the weighting factors applied to various land-use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential —Zone 1 1.00 Dwelling Unit Single Family Residential —Zone 2 0.75 Dwelling Unit School 0.25 Acre or portion thereof_ Vacant 0.25 Acre or portion thereof The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P359 Fiscal Year Maximum Assessment per EBU Actual Assessment per EBU 2010/11 246.97 246.97 2011/12 366.00 366.00 2012/13 382.15 373.66 2013/14 390.65 390.65 Maximum Actual Property Type Allowable Assessment Rate Total Total (County Use Code) Assessment per EBU Units/Acres EBUs Rate per EBU Single Family Residential —Zone 1 $390.65 $390.65 963.00 963.00 Single Family Residential —Zone 2 $390.65 $390.65 310.00 232.50 School $390.65 $390.65 5.35 1.3375 Vacant $390.65 $390.65 0.54 0.14 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Cost of Living Inflator Each fiscal year beginning Fiscal Year 2010/11, the maximum allowable assessment amount may be increased by the lesser of 3.5% or the percentage change in the year ending February preceding the start of the Fiscal Year of the Consumer Price Index for all Urban Consumers (CPI-U), for the Los Angeles-Riverside-Orange County area. If for any reason the percentage change is negative the maximum allowable assessment would not be decreased by reason of such negative percentage change and would remain at the amount as computed on the previous fiscal year regardless of any CPI adjustment. The annual assessment cannot exceed the actual costs to operate the District in any given year. If operating costs are such that the maximum assessment amount is not needed, the City would levy only what is needed for that year. The assessment rate for Fiscal Year 2013/14 will increase from $373.66 to $390.65 per single- family residence Zone 1 and from $280.25 to $292.99 per single family residence Zone 2, a CPI increase of 2.22% as compared to Fiscal Year 2012/13. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 17 Fiscal Year 2013/14 • P360 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 18 Fiscal Year 2013/14 bT/ETOZ ae@A leosH P361 6L e2uowe3nj oipuej Jo Alit—b-g •oN Puls!Q aJueualu!etN ade3spuel CC w a) II w C) N •L ›1..., E ai N veil Q J CO N a) el •� o 13 _ s N O o 0 C U ce N N O ny/wag° co r-t in it •r3 V , .;�, J tiX . o 1 a) _ :i Ir J CO•V a) _ N Y m o 2 rte.+ I IL < �C i g .. ..�^d ise 3 to - a 1 ■ ! v jny epue)wl3 A V epuemq CD 1 CL i C.: C) 118 slaw° ea._.._ 1 IC::\ C ny Jalsayooj ' ny Jalsayoo8 Cl3 J ! � .� AV ua�{!IIlW I ny ua)l!II!W t I i II I I id AV uaneH i � ny uaneH I i AV esowJaH i n esouaia I (• d H AV pleq!4o'd • i f ^d pleq!4oid ny uewllaH ! t u) u IlaH nv r eel v I I ^d pJC�(au!n IS ueilaux0 i Ills!!"!!!!!11 I n a) m 61 f,: 'wiz�• J 1 r V) 0 t lilliqiiiii! W C CO LL MI a m 1111:111 ;!;il. ��N 11111°411111* 4i 0:5 P362 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Maximum Property Type Assessment Rate Total Total Allowable (County Use Code) per EBU Units/Acres EBUs Assessment Single Family Residential $390.65 963.00 963.00 $376,195.95 —Zone 1 Single Family Residential $390.65 310.00 232.50 $90,826.13 —Zone 2 School $390.65 5.35 1.3375 $523.47 Vacant $390.65 0.54 0.1350 $54.69 TOTALS 1,278.89 1,196.973 $467,600.24 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No. 6-R—City of Rancho Cucamonga 20 Fiscal Year 2013/14 P363 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 7 (North Etiwanda) P364 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 7 (NORTH ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P365 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 12 District Budget Definitions of Budget Items Method of Assessment 15 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 18 Assessment Roll 20 Assessment Roll Annexations P366 • ENGINEER'S LETTER WHEREAS, on July 3, 2013 the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 7 (North Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 860,970.00 Less Anticipated Delinquencies (2,150.00) Total Estimated Revenue $ 858,820.00 Plus Reserve Fund Contribution 210,280.00 Total Expenditure Budget $ 1,069,100.00 Total District EBU Count 2,804.00 Actual Assessment per EBU $ 307.05 Maximum Allowable Assessment per EBU $ 307.05 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 7—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P367 2. I have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 7—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P368 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 7—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P369 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 7—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P370 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area of the City known as North Etiwanda, which is generally bounded by the 210 Freeway on the south, 1-15 Freeway on the west, and City limits on the north. Typically, parcels have been annexed to the District as they have been developed. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements are the maintenance and servicing of the paseos, parkways, median islands, street trees, parks, landscaped sites and appurtenant facilities that are throughout the North Etiwanda. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines; ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Etiwanda Creek Park. Site # Descriptive Location EN-1 The north side of Wilson from San Sevaine to Ridgeline. The east side of Ridgeline from Wilson to Arcadia, the south side of Arcadia from Ridgeline to 77 feet east of Ridgeline. Ground Cover area: 27,325 square feet Turf area: 19,334 square feet Hardscape area: 840 square feet EN-2 The Metropolitan Water District easement on the south side of Crescenta Way from San Marino to Ridgeline. Ground Cover area: 38,104 square feet Landscape Maintenance District No. 7—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P371 Turf area: 41,250 square feet Hardscape area: 9,000 square feet EN-3 The Wilson median from Wardman Bullock to San Sevaine. Ground Cover area: 9,016 square feet Hardscape area: 11,088 square feet EN-4 The Planters on the north side of the drainage easement that is between and parallel to Highland and Arapaho east of Etiwanda Ave. Ground Cover area: 63,972 square feet EN-5 The south side of Wilson from 1,115 feet west of San Sevaine to 205 feet east of San Sevaine. The Landscape east of San Sevaine from 24th to south end tract. Ground Cover area: 45,584 square feet Turf area: 3,527 square feet EN-6 The north side of Wilson from Wardman Bullock to Ridgeline. The west side of Ridgeline from Wilson to 120 feet north of Arcadia. Ground Cover area: 29,226 square feet Turf area: 15,136 square feet Hardscape area: 1,300 square feet EN-7 The parkway on the eastside of Wardman Bullock from 24th street to 857 feet north of Glendora. The cobblestone between the tract wall and the flood wall will be handled as extra for debris pickup and weed control on an as needed basis. Ground Cover area: 10,268 square feet Hardscape area: 31,549 square feet EN-8 The south side of Crescenta Way from Ridgeline to Crestline. Ground Cover area: 50,035 square feet Turf area: 35,960 square feet Hardscape area: 10,000 square feet EN-9 The paseo from Meadow Brook to Rock Creek Road. Ground Cover area: 1,400 square feet Turf area: 6,555 square feet Hardscape area: 2,820 square feet EN-10 The paseo from Etiwanda to North Rim Way. The west side of Etiwanda from 175 feet north of North Rim Way to 171 feet south of Golden Prairie Drive. Ground Cover area: 49,020 square feet Turf area: 4,445 square feet Hardscape area: 13,026 square feet Landscape Maintenance District No. 7—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P372 EN-11 The paseo south of Ridge Crest Drive to southern boundary of Tract 14139. This site is temporarily maintained by another contractor and was deleted from the contract as of 7-16-01 however this site is still the city's property. Ground Cover area: 3,548 square feet Turf area: 800 square feet Hardscape area: 4,280 square feet EN-12 The cul-de-sac on the north side of Ridgecrest at Etiwanda Creek Channel. Ground Cover area: 1,870 square feet Turf area: 700 square feet Hardscape area: 450 square feet EN-13 The east side of San Sevaine from Wilson to 136 feet north of Crescenta. Ground Cover area: 46,611 square feet Turf area: 5,037 square feet, EN-14 The west side of San Sevaine from 150 feet north of Wilson to 136 feet north of Crescenta. Ground Cover area: 55,166 square feet Turf area: 235 square feet Hardscape area: 6,975 square feet EN-15 The north side of Youngs Canyon Road from 500 feet east of Koch to 692 feet west of Koch. The south side of Youngs Canyon Road from 349 feet east of Koch to 692 feet west of Koch. The east and west side of Koch place from Youngs Canyon Road to 132 feet north of Youngs Canyon Road. The west side of Koch from Youngs Canyon Road to 132 feet south of Youngs Canyon Road. The east side of Koch from 82 feet south of Youngs Canyon Road to Youngs Canyon Road. The trailhead north east of the east end of Youngs Canyon Road to the south end of San Sevaine Horse Trail. The south end of San Sevaine Horse from the trail head to 254 feet north of trailhead. Ground Cover area: 42,925 square feet Hardscape area: 14,308 square feet EN-16 The east side of Wardman Bullock from 225 feet south of San Segundo Drive to 80 feet north of Dona Way. Ground Cover area: 2,056 square feet Hardscape area: 3,450 square feet EN-17 The north side of Colonbero from San Sevaine Channel to Guidera Drive. The south side of Colonbero from San Sevaine Channel to 400 feet north of Guidera Drive. The north side of Aggazzotti from Colonbero to 4 75 feet east of Colonbero. This site has a pump which will be adjusted and maintained by city personnel. Ground Cover area: 43,241 square feet Hardscape area: 29,125 square feet Landscape Maintenance District No. 7—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P373 EN-18 The north side of Aggazzotti Road from San Antonio Drive to San Sevaine Road. The west side of San Sevaine road from Aggazzotti to 702 feet south of Aggazzotti. The East side of San Sevaine Road from 702 feet south of Aggazzotti to Regina. Ground Cover area: 47,823 square feet Hardscape area: 30,986 square feet EN-19 The south side of Wilson from Etiwanda to Estates Way. Ground Cover area: 45,727 square feet Hardscape area: 19,229 square feet EN-20 The east side of Bluegrass from 190 feet south of Vista Verde Dr. to Wilson Avenue. The south side of Wilson Avenue form Bluegrass Avenue to Estates Way. Ground Cover area: 85,155 square feet Hardscape area: 48,784 square feet EN-21 The north side of Wilson from Etiwanda to Cervantes. The Wilson median from Etiwanda to Cervantes. The Westside of Etiwanda from Wilson to Del Norte Place. Ground Cover area: 88,795 square feet Hardscape area: 27,128 square feet EN-22 The north and south side of Vintage from 165 feet east of Country View to 338 feet west of Country View. • Ground Cover area: 13,603 square feet Hardscape area: 7,365 square feet EN-23 The north side of Wilson and median from Etiwanda west to Etiwanda. The east side of Etiwanda from Wilson to 1150 feet north of Wilson. Ground Cover area: 32,027 square feet Hardscape area: 29,567 square feet EN-24 The north side of Vintage from 360 feet west of Ascot to 230 feet east of Countrywood. Ground Cover area: 34,707 square feet Hardscape area: 92,600 square feet EN-25 The east side of Bluegrass from Banyan to 610 feet north of Banyan. Ground Cover area: 4,054 square feet Hardscape area: 5,819 square feet EN-26 The south side of Banyan from Bluegrass to Greenwood. Ground Cover area: 6,240 square feet Hardscape area: 3,200 square feet Landscape Maintenance District No. 7—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P374 EN-27 The south side of Banyan from Laurel Blossom to Etiwanda. Ground Cover area: 1,703 square feet Hardscape area: 8,417 square feet EN-28 The north side of Wilson from Cervantes to 1715 feet west of Cervantes. The west side of Cervantes from Carmel Knolls Drive to Wilson. The paseo from Wilson to Tejas Ct. The median on Wilson from Cervantes to Bluegrass. The following temporary landscape: There is 1 planter on the west side of Altura at Tejas. There are five planters on the south side of Tejas from Altura to 195 feet east of Altura. Ground Cover area: 25,048 square feet Hardscape area: 22,532 square feet EN-29 The south side of Banyan from 787 feet west of East Av. to East Av. The west side of East Avenue from Banyan to 600 feet south of Blue Gum. The east side of East Ave. from Banyan to 537 feet south of Banyan. Ground Cover area: 16,111 square feet Hardscape area: 15,774 square feet EN-30 The east side of Bluegrass Ave from 257 feet south of Churchill Drive to 418 feet north of Churchill Drive. Ground Cover area: 9,303 square feet Hardscape area: 5,302 square feet EN-31 The south side of Banyan Ave. from 375 feet south of Cashew Way to Rose Way. The north side of Banyan Ave. from 435 feet west of Peak PI. to Wardman Bullock Rd. Ground Cover area: 53,000 square feet Hardscape area: 26,855 square feet EN-32 The landscaping south of the equestrian trail from 210 feet west of Grovewood PI. to 1,170 feet east of Grovewood PI. Ground Cover area: 6,900 square feet EN-33 The north side of Youngs Canyon Rd. from 600 feet east of Banyan Ave. to Banyan Ave. The east side of Ward man Bullock Rd. from Banyan Ave. to Wilson Ave. The south side of Wilson Ave. from Wardman Bullock Rd. to 635 feet east of Fields Pl. Ground Cover area: 66,601 square feet Hardscape area: 46,332 square feet EN-34 The west side of Wardman Bullock Rd. from Wilson Ave. to Banyan Ave. Parkview Way from Wardman Bullock Rd. to Soledad Way. Ground Cover area: 56,314 square feet Hardscape area: 28,428 square feet EN-35 The north side of Day Creek Blvd. from Etiwanda Ave. to Indian Wells Place. Ground Cover area: 160,737 square feet Landscape Maintenance District No. 7—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P375 Hardscape area: 128,254 square feet EN-36 The south side of Day Creek from 380 feet north of Coyote to Etiwanda. The west side of Etiwanda from Day Creek to 170 feet north of North Rim. The hydro seeded landscape area inside the catch basin on the corner of Day Creek and Etiwanda. The west side of Day Creek from 380 feet north of Coyote to Indian Wells. Ground Cover area: 58,398 square feet Hardscape area: 68,127 square feet EN-37 The east side of East Ave. from 235 feet south of Hunt Club Dr. to 375 feet north of Hunt Club Dr. Ground Cover area: 5,559 square feet Hardscape area: 5,231 square feet EN-38 The west side of East Ave. from 236 feet north of Philly Dr. to 245 feet south of Philly Dr. Ground Cover area: 4,605 square feet Hardscape area: 3,394 square feet EN-39 The south side of Banyan form Golden Lock PI. to Raindrop PI. Ground Cover area: 6,024 square feet Hardscape area: 330 square feet Note: 3/25/13: Added new site effective 4/10/13. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 7—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P376 VT/ETOZ JeaA leasi j TT e2uoweDn0 oypuea Jo AID–L *oN TJlalsIG aaueualuiew adeaspuei °d- '4- Z O %1 a — sr 2 m W F i cc D F Z W W d u J W I- Z Z CC W O m O ~ r cn z 9• / Y W _U' w 0 N. 0 W 0 W / 1 :±I0 11 r i Z r W 1,111 OrOlna NV KIdVM z \ w r ^+ II w w C• CC Y cc x CC W d N- ter ° U �1 10 • O Y O w 1...,co Q m } — Z w 1 ° Z—m AV tsv3 o u, 7... I z N QD �. W i Cti i o � V o a g W V 6195' AV ' w w CO 2 AVvaNVM113 AVVONVM113 If, 0 CO W ` N 4 N G AP 1 n-, W Z� `- 1 WL w�a1J I . yI w W a.a. W W O N .42; .11..*E ' r Ili 9pv:•;jiy4iLi: -4r; - of l 111 !i{r�.ifl.s wit714 _ fl CL Zd P•lil3Ra97:' Q g.;0-';++NS1$i•of � U L[ T. aSe�esaa+,•r 2,,ax •.• a "a.;• 8021:.i 'sis?.t§7 P377 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Payroll $ 159,450.00 ' Part-time Salaries 10,380.00 Fringe Benefits 75,790.00 Subtotal Personnel $ 245,620.00 Operations and Maintenance Operations and Maintenance $ 46,960.00 Operations and Maintenance Facilities 1,000.00 Vehicle Operations and Maintenance 2,500.00 Contract Services 354,440.00 Tree Maintenance 6,950.00 Utilities Telephone Utilities 1,050.00 Water Utilities 295,540.00 Electric Utilities 24,850.00 Assessment Administration 15,430.00 General Overhead 68.760.00 Subtotal Operations and Maintenance $ 818,180.00 Capital Expenditures Capital Outlay — Equipment $ 5,300.00 Capital Proiects 0.00 Subtotal Capital Expenditures $ 5,300.00 Total District Expenditure Budget $ 1,069,100.00 Total Estimated Assessment $ 860.970.00 Less Anticipated Delinquencies (2,150.00) Total Estimated Revenues $ 858,820.00 Plus Operating Reserve Fund Contribution 210,280.00 Total Expenditure Budget $ 1,069,100.00 Total Estimated Assessment $ 860,970.00 Total District EBU Count 2,804.00 Actual Assessment per EBU — Fiscal Year 2013/14 $ 307.05 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 307.05 Landscape Maintenance District No. 7—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P378 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1996/97 and subsequent District annexations. Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 841,870.00 Operating Reserve Contribution — Fiscal Year 2013/14 (210,280.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 631,590.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Landscape Maintenance District No. 7—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P379 Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Proiects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 7—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P380 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) (of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 7—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P381 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the Caryn Planned Community and were installed to create a common landscape theme and neighborhood identity for parcels within the Caryn Planned Community. The improvements are situated within the public rights-of-way of the internal local street network within the Caryn Planned Community which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit Landscape Maintenance District No. 7—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P382 derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. When the District was formed in 1989, Article XIID and Proposition 218 had not yet been passed. Upon the passage of Article XIID and the subsequent passage of the Proposition Omnibus Implementation Act, new rules were put into place. Due to the changes in legal requirements, as property annexed to the District after the passage of the Assessment Law, the description of the method of assessment became more refined, however, the assessment per parcel has remained the same since the 1996/97 Fiscal Year. Further, no parcel included in the District formation or annexations prior to when the language was refined, are now being levied differently than they were at the time the District was formed or the parcels were annexed. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. Vacant parcels are assigned an EBU value of 0.25 per acre because they receive a lesser benefit from the improvements until such time as development occurs. The following table provides the weighting factors applied to various land-use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units IProperty Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Dwelling Unit The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $307.05 $307.05 2,804 2,804 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No. 7—City of Rancho Cucamonga 17 Fiscal Year 2013/14 P383 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 7—City of Rancho Cucamonga 18 Fiscal Year 2013/14 bT/£TOZ JeaA Ieas!1 P384 6T e2uowe3nj otpueli jo Al!O—Z -oN lo!ais!Q aaueuaau!ew adeJspuei N. N ".r Un V •... co 1. r • rR o 0 CD — ,ti ny kuay0 CD C , It '44 CC ' cC Z ►1/4. c 8 42) cu o _E- .0 m o 0 Inv ise3 6 R1 Li. ct A` i L c i ny epUeMi 9 Cl)RI I 0AeQ ny iaisayooa I ti `: I 1 ny Jaisayooa j i i Ay ua)l!II!W t._.._••_•._—._ i ny ua)l!II!W i II j j i i ny uaneH i — -- —1 — i j jny uaneH I I Ay esowJOH i !fly esowJOH I i AV Pleq! 13-ItJ 1 -- 1 1 i i 1 Inv Pleq!yoiy I l I I ny uewileH i ny uewllaH j tO v I I ny pUeAeu!n is ue!lawe3 l i i I iill:it pi 1bf ./.—(n C m �'-3-11-------------/ (n y � #affa�a� 1b ! i - i - (C O Q P !;141 • :i- ce c m u_ 4, €lif " il,1 co 7, c ilg�i' i, c,1 w co s S'„ Pa it as 111110104 •• p ....&g $ `g •$ € yy • t% IONI E al iF P385 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code per EBU Units/Acres EBUs Assessment Single Family Residential $307.05 2,804 1 2,804 1 $860,968.20 "'Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexation is effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code 0225-011-37 11/07/2012 PM19043 2.00 2.00 SFD 0226-081-17 11/21/2012 PM19367 2.00 2.00 SFD Landscape Maintenance District No. 7—City of Rancho Cucamonga 20 Fiscal Year 2013/14 P386 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 8 (South Etiwanda) P387 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 8 (SOUTH ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P388 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 8 District Budget Definitions of Budget Items Method of Assessment 11 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 14 Assessment Roll 16 Assessment Roll Annexations P389 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 8 (South Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 32,750.00 Less Anticipated Delinquencies (4,160.00) Total Estimated Revenue $ 28,590.00 Plus Reserve Fund Contribution 2.650.00 Total Expenditure Budget $ 31,240.00 Total District EBU Count 216.22 Actual Assessment per EBU $ 151.45 Maximum Allowable Assessment per EBU $ 151.45 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 8—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P390 2. 1 have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 8—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P391 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements,,the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 8—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P392 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of . 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 8—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P393 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area known as South Etiwanda, which is south of the 1-210 Freeway along Fisher Drive, east of East Avenue, including the south side of Highstone Manor Court, the south side of Smokestone Street, and to the San Bernardino County Flood Control drainage basin on east side. Typically parcels have been annexed to the District as they have been developed. Reference is also made to the Assessment Diagram included in this Report. Description of improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout the District. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Site # Descriptive Location SE-1 The east side of East Ave. from 480 feet south of Catalpa St. to 182 feet north of Catalpa St. The north and south side of Catalpa St. from East Ave. to Brownstone PI. The west side of Brownstone Pl. from Catalpa St. to 150 feet south of Catalpa St. Ground Cover area: 10,355 square feet Turf area: 6,258 square feet Hardscape area: 4,050 square feet SE-2 The south side of Fisher Dr. from 361 feet east of East Ave. to 210 feet east of Starstone Pl. Ground Cover area: 9,366 square feet Hardscape area: 4,074 square feet Landscape Maintenance District No. 8—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P394 SE-3 The south side of Fisher Dr. from 860 feet west of Mulberry St. to Mulberry St. Ground Cover area: 3,676 square feet Hardscape area: 6,910 square feet Total Ground Cover: 23,397 square feet Total Turf: 6,258 square feet Total Hardscape: 15,034 square feet Ground cover, shrubs and turf areas that make up parkways, median islands and paseos are maintained under contract by a private landscape maintenance company. With a Majority Protest for the Proposition 218 Ballot Initiative in September 2010 the city stopped maintaining the north side of Fisher Avenue and reduced the service level to a B. May of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 8—City of Rancho Cucamonga 6 Fiscal Year 2013/14 oE.eaA ie:)Sl, P 9 L men:) aw@@ -Em 7 _eaim we3s pm ± ) / $ w % \ LU / \ \ 0 \ # m 3 \ ( / 2 2 E 7 M % } \ 0 $ 7\ / § / e , | 10 | / � d 2 / 2 > U CD ( � / } R § _ 3 0 - � � @k � � ' \ \ � \ ! • l;:.l,.. __, g\ ! LE � P396 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Salaries $ 1,500.00 Part-time Salaries 0.00 Fringe Benefits 710.00 Subtotal Personnel $ 2,210.00 Operations and Maintenance Operations and Maintenance $ 2,300.00 Emergency Equipment & Vehicle Rental 0.00 Contract Services 10,080.00 Tree Maintenance 4,300.00 Utilities Water Utilities 4,590.00 Electric Utilities 1,030.00 Assessment Administration 1,050.00 General Overhead 5,680.00 Subtotal Operations and Maintenance $ 29,030.00 Capital Expenditures Capital Projects $ 0.00 Subtotal Capital Expenditures $ 0.00 Total District Expenditure Budget $ 31,240.00 Total Estimated Assessment $ 32,750.00 Less Anticipated Delinquencies 4 1( 60.00) Total Estimated Revenues $ 28,590.00 Plus Reserve Fund Contribution 2,650.00 Total Expenditure Budget $ 31,240.00 Total Estimated Assessment $ 32,750.00 Total District EBU Count 216.22 Actual Assessment per EBU — Fiscal Year 2013/14 $ 151.45 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 151.45 The maximum allowable assessment per EBU listed in the District budget above, is the amount which was approved in 1989/90, when the District was formed, and subsequent District annexations. Landscape Maintenance District No. 8—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P397 Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 54,700.00 Operating Reserve Contribution — Fiscal Year 2013/14 2,650.00 Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 52,050.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. Landscape Maintenance District No. 8—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P398 General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 8—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P399 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7(commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement' (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 8—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P400 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the Caryn Planned Community and were installed to create a common landscape theme and neighborhood identity for parcels within the Caryn Planned Community. The improvements are situated within the public rights-of-way of the internal local street network within the Caryn Planned Community which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit Landscape Maintenance District No. 8—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P401 derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use E uivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Sin le Family Residential 1.00 Dwelling Unit Non-Residential 2.00 Acre or portion thereof Church 1.00 Acre or portion thereof The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Property Type Maximum Allowable Actual Assessment Total Total (County Use Code) Assessment Rate Rate per EBU Units/Acres EBUs per EBU Single Family Residential $151.45 $151.45 188.00 188.00 Non-Residential $151.45 $151.45 13.61 27.22 Church $151.45 $151.45 1.00 1.00 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Landscape Maintenance District No. 8—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P402 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 8—City of Rancho Cucamonga 14 Fiscal Year 2013/14 bT/£TOZ JeaA le:)s!j P403 ST e2uowean:)oyaueb;o Al!:)—g 'ON aauTs!Q aaueuatu!eVy adeaspuel 0 w V 'i r.+ E J QO Q 0 V I . AV AJJayo `f j m t 3 f o 0 Li Q I ����..._.._.._.._. AV Ise3 in Q i AV epuervy —i AV epuernil3 � I I N i I i9 laajo Aea AVialsayooa ! _ - J ny Jalsayooa i 1 j AV ua>f!II!n f._.._.._..—.—.� j AV uaH!II!n 1 � i 1 � ny uaneH jnV uaneH i ny esowJaH 44. !AV esowaH 1 AV Pley!yWV i jAV Pley!yajV ny uewpaH i U) AV uewllaH I ( AV PjeAau!n IS uegaweo r..._..� � ny anwE) I (n c Fa �'—_�.._.._..�..—•r �, z o m' j�i I��IT{bet a m °o ¢` '�tt;p�t�I a: c m w j'i fits N m II!1 t ilE�aif�tl�� . i x' lr,t r P404 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code per EBU Units/Acres EBUs Assessment Single Family Residential $151.45 188.00 188.00 $28,472.60 Non-Residential $151.45 13.61 27.22 4,122.47 Church $151.45 1.00 1.00 151.45 TOTALS 1 202.61 216.22 1 $32,746.52 *"Actual Assessment Rate per EBU" is the same as "Maximum Allowable Assessment Rate Per EBU". A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No. 8—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P405 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 9 (Lower Etiwanda) P4O6 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 9 (LOWER ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P407 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 9 District Budget Definitions of Budget Items Method of Assessment 12 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 16 Assessment Roll 18 Assessment Roll Annexations P408 ENGINEER'S LETTER WHEREAS, on July 3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the "1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 8 (Lower Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 167,400.00 Plus Anticipated Delinquency Penalty 26 080.00 Total Estimated Revenue $ 193,480.00 Plus Reserve Fund Contribution 302.400.00 Total Expenditure Budget $ 495,880.00 Total District EBU Count 2,092.56 Actual Assessment per EBU $ 80.00 Maximum Allowable Assessment per EBU $ 527.03 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 9—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P409 2. 1 have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. c Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 9—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P410 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 9—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P411 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice"), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 9—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P412 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area known as Lower Etiwanda, which is south of Victoria Street, north of Foothill Boulevard, generally east of Etiwanda Avenue and the 1-15 Freeway and west of East Avenue. Typically parcels have been annexed to the District as they have developed. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout the District. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Garcia Park (formerly known as South Etiwanda Park). Site# Descriptive Location 9-1 The west side of East Ave. from 380 feet north of Chateau to 290 feet south of Chateau. Ground Cover area: 4,426 square feet Hardscape area: 7,360 square feet 9-2 The west side of East Ave. from 339 feet north of Brookfield to 157 north of Brookfield. Brookfield from East Ave. to Oak Crest. The east side of Oak Crest to 137 feet north of Brookfield. Ground Cover area: 2,390 square feet Hardscape area: 6,874 square feet Landscape Maintenance District No. 9—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P413 9-3 The west side of East Ave. from 790 feet north of Highfield to 256 feet south of Highfield. Ground Cover area: 8,769 square feet Hardscape area: 10,669 square feet 9-4 The west side of East Ave. From 295 feet north of Via Veneto To Via Veneto. The north side of Via Veneto From East Ave to Dolcetto. The east side of Dolcetto from Via Veneto to Miller Ave. The south side of Miller Ave from 372 feet west of Dolcetto to 240 feet east of Dolcetto. The west side of Dolcetto from Miller to Garcia. The north side of Garcia from Dolcetto to Etiwanda Ave. Ground Cover area: 48,612 square feet Hardscape area: 28,746 square feet 9-5 The north side of Miller from 429 feet west of Dolcetto to 1029 feet west of Dolcetto. Ground Cover area: 6,519 square feet Hardscape area: 3,325 square feet 9-6 The north side of Miller from 254 feet east of Dolcetto to 167 feet west of Dolcetto. Ground Cover area: 4,089 square feet Hardscape area: 2,854 square feet 9-8 The south side of Baseline from Etiwanda Ave. to Shelby. The Baseline median form Etiwanda to 473 feet east of Shelby. Ground Cover area: 16,395 square feet Hardscape area: 14,558 square feet 9-9 The north side of Candlewood St. from Exbury St. to Etiwanda Ave. Ground Cover area: 3,362 square feet Hardscape area: 786 square feet 9-10 The north side of Baseline form 522 feet east of Forester to 180 feet west of Frester. The Baseline median form 503 feet east of Forester to 200 feet west of Forester. Ground Cover area: 16,930 square feet Hardscape area: 13,600 square feet 9-11 The north side of Mueller Ct. from 40 feet past the east end of Mueller Ct. to 20 feet east of Dicarlo Pl. Ground Cover area: 9,420 square feet Hardscape area: 742 square feet 9-12 The north and south sides of Highland Ave. from 217 feet west of Norcia Dr. to 210 feet east of Dicarlo PI. Ground Cover area: 12,471 square feet Hardscape area: 14,445 square feet Landscape Maintenance District No. 9—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P414 9-13 The south side of Carnesi Dr. from Etiwanda Ave. to 395 feet east of Murietta Ct. Ground Cover area: 8,919 square feet Hardscape area: 6,203 square feet 9-14 The west side of East Ave. from 665 feet north of Miller to Miller. The north side of Miller from East Ave. to 667 feet west of East Ave. Ground Cover area: 9,150 square feet Hardscape area: 16,226 square feet FH-17 The Foothill Blvd. median from Etiwanda Ave. to Cornwell Ave. Ground Cover area: 8,275 square feet Ground cover, shrubs and turf areas that make up parkways, median islands and paseos are maintained under contract by a private landscape maintenance company. Parks are maintained by the City's Park Maintenance Crews. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 9-City of Rancho Cucamonga 7 Fiscal Year 2013/14 c-. .. . ice++ ll I ILJ II H I\ Hill fill If_! \!.t \i..l\ la11 3 -"rf—r l� 4 5 1 Landscape Maintenance District No. 9 D Apr Improvement Map Uf -Renew Lf_�- 91_� ' .'J-'i)`ti� UceMOn'G - L�IrJ � —I 210 FlNr�- i'��'- I �I��� � ' -�- 1210�WE57-RA P RP ua1 o,HW li}g+SO J 1+210A HIGHLAND AV I IGRLANDAV -rr��rH RAh9P m , c c fil y`T`�t ,�I.1ITf�'i 1-.- �: L11LJ s 11 Z:71 i - w ( ��� r � � l � Ir � I arflff IIJ_Y / ,I � ILt.Iu u I��-M1III "Tt ,t %�.I17". IL =7i.1 (�:�r,Qrili .Y��.LLTIIlI]I �/ -- II ' i L� 6 —G ? _ . R 11 Ll GUM ST IIIl � , r 1 E LI�L _ -- r r„ •rrhml� I „ r_ - �\S15p4RPi ^y0. LLLtr7-1 I Il t 'i1i —I r LL _ SE LINE RD;18,1.00 _ . �z� r ' ¢ .^` •�� WATER METER z- by i 83� err t >' ���} N IRRIGATION PUMP y rrrna.. i �v—' 1 � ¢. I, , Pac fic Electric Trail q �1CHURCHISTL N AX iIi I� � fi IIj_ F ° f �� � IRRIGATION LINE g� C l~�' g;� ILLERAV'96�� Parks t LIVID 9 Boundary i_u MAJOR STREET MEN FREEWAY ® PARCELS VICTORIA GARDENS LN -nil— 1 j°1' �o. _ �1 rn.m.p..me„r�e...v.pl+=eyo—I.'n.mrmna.l FOOTHILL B�'L_ ((jr ..1'�.�('I'�Ii ' I` I •� +raaek ln.cNor o The / S r, +� waC„ po,�rle lo4oy"eter X11 N„Ilr JrE Yt her rf net'If 1 �_— ! V FH-171S IN LMD9 BUT ,.m,orma.rrmr.o mkal am ee.^. MAINTAINED BY MARIPOSA r denRancho n c.�,m�o.p nr + recanted h rq,.pk IV and hach—t inY„vr sere an, no..r.cr..ne^.w me.. ro,... n.mdw,, —+^ a— lmAVE+lo.mM.Impf.ew, ncde scloced m, Nmzbr, rli krp rp—recf/o,fl �oere n, 1 al.ill.r xewprn.r nw wn..ry lLeaN,rwesekww.rm. rwarmmr(p,n wh 'f( nY IN.rmztion prerNee,nd.6(�m...a.nterdet 'fa /� urnnp eue l.,nr pev.nz relunee open the ln,orm,1'rm , 1 r ril,Lk leren. Ir� Landscape Maintenance District No. 9-City of Rancho Cucamonga 8 Fiscal Year 2013/14 P416 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Salaries $ 150,030.00 Part-time Salaries 7,860.00 Fringe Benefits 71.290.00 Subtotal Personnel $ 229,180.00 Operations and Maintenance Operations and Maintenance $ 20,850.00 O & M/Computer Equipment 0.00 Cellular Technology 1,080.00 Emergency Equipment & Vehicle Rental 1,200.00 Contract Services 133,240.00 Tree Maintenance 26,050.00 Utilities Water Utilities 27,550.00 Electric Utilities 8,730.00 Assessment Administration 9,100.00 General Overhead 32.700.00 Subtotal Operations and Maintenance $ 260,500.00 Capital Expenditures Capital Outlay— Equipment $ 6,200.00 Capital Projects $ 0.00 Subtotal Capital Expenditures $ 6,200.00 Total District Expenditure Budget $ 495,880.00 Total Estimated Assessment $ 167,400.00 Plus Anticipated Delinquency Penalty 26,080.00 Total Estimated Revenue $ 193,480.00 Plus Reserve Fund Contribution 302,400.00 Total Expenditure Budget $ 495,880.00 Total Estimated Assessment $ 167,400.00 Total District EBU Count 2,092.56 Actual Assessment per EBU — Fiscal Year 2013/14 $ 80.00 Maximum Allowable Assessment per EBU — Fiscal Year 2013/14 $ 533.83 Landscape Maintenance District No. 9—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P417 Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 2,450,250.00 Operating Reserve Contribution — Fiscal Year 2013/14 (302,400.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 2,147,850.00 The City has reserve funds that are more than sufficient to cover an estimated six months' worth of maintenance and servicing costs for the District. When there are excess funds in the District's reserve account, the excess can be used to lower the annual levy to property owners within the District. The City will continue to annually review the estimated costs and expenses for the District as well as reserve fund levels, in order to determine if future levies can be reduced as well. Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Landscape Maintenance District No. 9—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P418 Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 9—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P419 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement" (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 9—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P420 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the District and were installed to create a common landscape theme and neighborhood identity for parcels within the District. The improvements are situated within the public rights-of-way of the internal local street network within the District which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the Caryn Planned Community and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. Landscape Maintenance District No. 9—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P421 To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwelling Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Dwelling Unit Multi-Family Residential 1.00 Dwelling Unit Non-Residential Improved 2.00 Acre Vacant Property 0.25 Acre The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following table reflects both the maximum allowable assessment and the actual assessment rates for each year since the formation of the district and the proposed assessment rate for fiscal year 2013/14 for the District: Fiscal Year Maximum Assessment per EBU Actual Assessment per EBU 2000/01 $375.91 $375.91 2001/02 388.02 375.91 2002/03 398.81 375.91 2003/04 414.44 375.91 2004/05 421.71 375.91 2005/06 1 438.67 375.91 2006/07 459.15 375.91 2007108 476.76 387.94 2008/09 492.41 387.94 2009/10 492.41 387.94 2010/11 501.55 387.94 2011/12 516.58 187.00 2012/13 527.03 187.00 2013/14 1 533.83 80.00 Landscape Maintenance District No. 9-City of Rancho Cucamonga 14 Fiscal Year 2013/14 P422 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Cost of Livinq Inflator Each fiscal year beginning with Fiscal Year 2002/2003, the amount of the assessment for the District has increased each year, based upon the Consumer Price Index ("CPI"), All Urban Consumers, for the Los Angeles-Anaheim-San Bernardino Area, as determined by the United States Department of Labor, Bureau of Labor Statistics, or its successor. The Engineer shall compute the percentage difference between the CPI for March of each year and the CPI for the previous March, and shall then adjust the existing assessment by an amount not to exceed such percentage for the following fiscal year. Should the Bureau of Labor Statistics revise such index or discontinue the preparation of such index, the Engineer shall use the revised index or a comparable system as approved by the City Council for determining fluctuations in the cost of living. If for any reason the percentage change is negative the maximum allowable assessment would not be decreased by reason of such negative percentage change and would remain at the amount as computed on the previous fiscal year regardless of any CPI adjustment. The annual assessment cannot exceed the actual costs to operate the District in any given year. If operating costs are such that the maximum assessment amount is not needed, the City would levy only what is needed for that year. The Fiscal Year 2013/14 actual assessment rate is reduced from the prior year due to the City having reserve funds that are more than sufficient to cover an estimated six months' worth of maintenance and servicing costs for the District. When there are excess funds in the District's reserve account, the excess can be used to lower the annual levy to property owners within the District. The City will continue to annually review the estimated costs and expenses for the District as well as reserve fund levels, in order to determine if future levies can be reduced as well. Landscape Maintenance District No. 9-City of Rancho Cucamonga 15 Fiscal Year 2013/14 P423 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 9—City of Rancho Cucamonga 16 Fiscal Year 2013/14 bi/£i0Z jeaA le:)s!j P424 Li e2uoweun0 oyuuea;o Al!:)-6 'ON aouas!d az)ueualu!ew adeuspuel � w w C U J in 0 4 L AV Aijayp INS � • , m to lC O C m g e i LL a ® �)^VIse3 rn W � � a i AV epueM!y AV epuenn!13 h a 3e Xaaj-)Ae(3 J AV JOIs04308 nyia)sayooa AV uaI!11!Vq ��vo - AV uaj!11!W AV uan eH ( � ( my ueneH AV esowJaH AV esowiaH ^V ple9!43iV - ^V PIe9!4ojV AV uew11aH — N AV uewllaH � L L � AV pXAau!n IS ue!laweo - �islEle �,�l AV anal 00 w L J 3 L S;f�Sl�Jv`ge =j4 i5 N O LL P425 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable (County Use Code per EBU Units/Acres EBUs Assessment Single Family Residential $533.83 999.00 999.00 $526,502.97 Multi-Family Residential 533.83 1,057.00 1,057.00 557,070.71 Non-Residential Improved 533.83 18.28 36.56 19,268.22 Vacant Property 533.83 0.00 0.00 0.00 TOTALS 2,074.28 2,092.56 $1,102,841.90 Actual Property Type Assessment Rate Total Total Actual (County Use Code Per EBU Units/Acres EBUs Assessment Single Family Residential $80.00 999.00 999.00 $79,920.00 Multi-Family Residential 80.00 1,057.00 1,057.00 84,560.00 Non-Residential Improved 80.00 18.28 36.56 2,924.80 Vacant Property 80.00 0.00 0.00 0.00 TOTALS 2074.28 2,092.56 $167,404.80 A copy of the full assessment roll is available for review in the City Clerk's office. Annexations The following Annexation is effective for the 2013/14 Fiscal Year. Assessor's Annexation Total Total Property Type Parcel Number Date Project Units/Acres EBUs (County Use Code 0227-131-03 01/18/12 TR 18806 33 SFD 33.00 Single-Family Residential 0225-161-65 & 04/18/12 TR 18096 32 SFD 32.00 Single-Family Residential 71 Landscape Maintenance District No. 9—City of Rancho Cucamonga 18 Fiscal Year 2013/14 P426 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Landscape Maintenance District No. 10 (Rancho Etiwanda) P427 CITY OF RANCHO CUCAMONGA LANDSCAPE MAINTENANCE DISTRICT NO. 10 (RANCHO ETIWANDA) 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Dean Rodia, Parks & Landscape Superintendent Christopher Bopko, Management Analyst III P428 TABLE OF CONTENTS Engineer's Letter 1 Introduction 3 Reason for Assessment Process for Annual Assessment Plans and Specifications 5 Description of the Boundaries of the District Description of Improvements and Services Map of Improvements Estimate of Costs 9 District Budget Definitions of Budget Items Method of Assessment 12 General General Benefit Special Benefit Method of Assessment Spread Assessment Diagram 16 Assessment Roll 18 Assessment Roll Annexations P429 ENGINEER'S LETTER WHEREAS, on July3, 2013, the City Council of Rancho Cucamonga, under the Landscape and Lighting Act of 1972 (the 1972 Act") adopted its Resolution No. 13-102, a Resolution Initiating Proceedings for the Levy of Annual Assessments for Landscape Maintenance District No. 8 (Rancho Etiwanda) (the "District"); and WHEREAS, the Resolution Initiating Proceedings directed staff to prepare and file an Engineer's Report for Fiscal Year 2013/14 pursuant to the requirements of the 1972 Act. The Engineer's Report presents the plans and specifications describing the general nature, location and extent of the improvements to be maintained, an estimate of the costs of the maintenance, operations and servicing of the improvements for the District for the referenced fiscal year, a diagram for the District, showing the area and properties proposed to be assessed, and an assessment of the estimated costs of the maintenance, operations and servicing the improvements, assessing the net amount upon all assessable lots and/or parcels within the District in proportion to the special benefit received; and NOW THEREFORE, the following assessment is proposed to be authorized in order to pay the estimated costs of maintenance, operation and servicing of the improvements to be paid by the assessable real property within the boundaries of the District in proportion to the special benefit received. The following table summarizes the proposed assessment. SUMMARY OF ASSESSMENT Fiscal Year 2013/14 Total Estimated Assessment $ 476,940.00 Plus Anticipated Delinquency Penalty 5 8( • 10.00) Total Estimated Revenue $ 471,130.00 Plus Reserve Fund Contribution 169.680.00 Total Expenditure Budget $ 640,810.00 Total District EBU Count 774.00 Actual Assessment per EBU $ 616.20 Maximum Allowable Assessment per EBU $ 821.46 In making the assessments contained herein pursuant to the 1972 Act: 1. I have identified all parcels which will have a special benefit conferred upon them from the improvement described in the Special Benefit Section of this Engineer's Report (the "Specially Benefited Parcels"). For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is included in this Engineer's Report. Landscape Maintenance District No. 10—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P430 2. 1 have evaluated the costs and expenses of the improvements upon the Specially Benefitted Parcels. In making such evaluation: a. The proportionate special benefit derived by each Specially Benefited Parcel from the improvements was determined in relationship to the entirely of the maintenance costs of the improvements; b. No assessment has been imposed on any Specially Benefitted Parcel which exceeds the reasonable cost of the proportional special benefit conferred on such parcel from the improvements; and c. Any general benefits from the improvements have been separated from the special benefits and only special benefits have been assessed. I, the undersigned, respectfully submit the enclosed Engineer's Report and, to the best of my knowledge, information and belief, the Engineer's Report, Assessment Diagram herein have been prepared and computed in accordance with the order of the City Council of the City of Rancho Cucamonga and the Assessment Law. -may Mark A. Steuer, Director of Engineering Services/City Engineer Landscape Maintenance District No. 10—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P431 INTRODUCTION Reason for Assessment Approval of the assessment covered by this Engineer's Report will generate the revenue necessary to: Provide for the maintenance and servicing of the improvements described in this Engineer's Report. Maintenance may include but is not limited to, all of the following: the upkeep, repair, removal or replacement of all or any part of any improvement or facility such as paseos, community trails, fencing and irrigation systems, and providing for the growth, vigor and care of the trees and landscape plant materials. Servicing means the furnishing of electricity, gas or other illuminating energy for the lighting of landscape or appurtenant facilities. This shall also include material, vehicle, equipment, capital improvements and administrative costs associated with the annual administration and operation of the District. Process for Annual Assessment The City cannot levy and collect annual assessments within the District without complying with the procedures specified in the 1972 Act. On an annual basis, an Engineer's Report must be prepared which contains a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. The City Council must also adopt a resolution of intention which: • Declares the intention of the City Council to levy and collect assessments within the assessment district for the fiscal year stated therein. • Generally describes the existing and proposed improvements and any substantial changes proposed to be made in existing improvements. • Refers to the assessment district by its distinctive designation and indicate the general location of the district. • Refers to the report of the engineer, on file with the clerk, for a full and detailed description of the improvements, the boundaries of the assessment district and any zones therein, and the proposed assessments upon assessable lots and parcels of land within the district. • Gives notice of the time and place for public hearing by the City Council on the levy of the proposed assessment. • States whether the assessment is proposed to increase from the previous year. If the assessments are to be levied in the same or lesser amounts than the maximum assessment amount approved, the clerk shall give notice by causing the resolution of intention to be published. Any interested person may, prior to the conclusion of the public hearing, file a Landscape Maintenance District No. 10—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P432 written protest which shall state all grounds of objection. The protest shall contain a description sufficient to identify the property owned by the property owner filing the protest. During the course or upon conclusion of the hearing, the City Council may order changes in any of the matters provided in the report, including changes in the improvements, any zones within the assessment district, and the proposed diagram or the proposed assessment. The City Council, upon conclusion of the public hearing must then adopt a resolution confirming the diagram and assessment, either as originally proposed or as changed by it. The adoption of the resolution shall constitute the levy of an assessment for the fiscal year referred to in the assessment. If the assessment to be levied exceeds the maximum assessment amount previously approved, the City must comply with the procedures specified in Article XIII D and Proposition 218. The voters in the State of California in November 1996 added Article XIII D to the California Constitution imposing, among other requirements, the necessity for the City to conduct an assessment ballot procedure to enable the owners of each property on which assessments are proposed to be enacted or increased, the opportunity to express their support for, o opposition to the proposed assessment or increase in such assessment. The basic steps of the assessment ballot procedure are outlined below. The City must prepare a Notice of Public Hearing ("Notice'), which describes, along with other mandated information, the reason for the proposed assessments, and to provide a date and time of a public hearing to be held on the matter. The City must also prepare an assessment ballot, which clearly gives the property owner the ability to sign and mark their assessment ballot either in favor of, or in opposition to the proposed assessment. The Notice and assessment ballot are mailed to each affected property owner within the District a minimum of 45 days prior to the public hearing date as shown in the Notice. The City may also hold community meeting with the property owners to discuss the issues facing the District and to answer property owner questions directly. After the Notice and assessment ballot are mailed, property owners are given until the close of the public hearing, stated in the Notice, to return their signed and marked assessment ballot. During the public hearing, property owners are given the opportunity to address the City Council and ask questions or voice their concerns. At the public hearing, the returned assessment ballots received prior to the close of the public hearing are tabulated, weighted by the proposed assessment amount on each property and the results are announced by the City Council. Article XIII D provides that if, as a result of the assessment ballot proceeding, a majority protest is found to exist, the City Council shall not have the authority to levy and collect the assessments as proposed. A majority protest exists if the assessments represented by ballots submitted in opposition exceed those submitted in favor of the assessment. All returned ballots are tabulated and weighted according to the financial obligation of each particular parcel. If there is no majority protest as described above, the City Council may approve the proposed assessments. If the is a majority protest, as described above, the City will not levy and collect any assessments. Landscape Maintenance District No. 10—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P433 PLANS AND SPECIFICATIONS The District provides for the administration, maintenance, operations, and servicing of various improvements located within the public right-of-way and dedicated easements within the boundaries of the District. Description of the Boundaries of the District The District is located in the City of Rancho Cucamonga, State of California. The boundaries of the District are generally described as that area known as Rancho Etiwanda, which lies north of Highway 210, east of Day Creek Channel, and west of Hanley Avenue. Typically parcels have been annexed to the District as they have developed. Reference is also made to the Assessment Diagram included in this Report. Description of Improvements and Services The improvements maintained by the District include the paseos, community trails, trees, landscaped sites and appurtenant facilities that are throughout Rancho Etiwanda. These improvements are located within the street right-of-ways and dedicated public easements which are within the boundaries of the District. The landscaping maintenance includes, but is not limited to, the pruning, fertilizing, mowing, weeding, pest control, removal of trash/debris, and irrigation of the trees, shrubs, vines, ground cover, and turf. Maintenance of associated improvements and facilities, such as community trails, fencing and irrigation systems, includes but is not limited to, grading and replacement of trail surfacing, trail fence repair and replacement, steel fence painting, repair and replacement, and irrigation systems control, adjustment, trouble-shooting, repair and replacement. Services include personnel, materials, contracting services, utilities, capital projects and all necessary costs associated with the maintenance, replacement and repair required to keep the improvements in a healthy, vigorous and satisfactory condition. In addition, it is the City's intention to continue to use cost effective materials, including the future ability to replace landscaping with drought resistant or low water use plants, in order to lower expenses of the District. The breakdown of maintained areas is as follows: Parks: Day Creek Park. Site# Descriptive Location 10-1 The west side of Day Creek from 790 feet north of Richfield to Wilson. The north side of Wilson from Day Creek to 227 feet west of Day Creek. This site overlaps 10-2. Ground Cover area: 16,941 square feet Hardscape area: 3,589 square feet 10-2 The north and south side of Wilson from 497 feet west of Alvarado to Day Creek with 1 station at top of highest retaining wall on corner of Wilson and Day Creek. This station overlaps site 10-1. The south side of Wilson from Day Creek to Bluegrass. The Wilson median from Day Creek to Bluegrass. Ground Cover area: 47,275 square feet Hardscape area: 6,444 square feet Landscape Maintenance District No. 10—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P434 10-3 The west side of Day Creek from Wilson to 144 feet south of Clydesdale. The Day Creek median from Wislon to Banyan. Ground Cover area: 32,619 square feet Hardscape area: 10,983 square feet 10-4 The east side of Day Creek from 648 feet south of Keenland to Wilson. Ground Cover area: 15,952 square feet Hardscape area: 4,365 square feet 10-5 The west side of Bluegrass from Wilson to 705 feet west of Challendon. Ground Cover area: 26,882 square feet Hardscape area: 12,220 square feet 10-6 The south side of Banyan from Rochester to Day Creek. The north side of Banyan from 427 feet west of Rocking Horse to Rocking Horse. The west side of Day Creek from Banyan to Vintage. The Day Creek median from Banyan to Vintage. The north side of Vintage from Day Creek to paseo ending 153 feet west of Sand Hill. Ground Cover area: 44,000 square feet Hardscape area: 16,197 square feet 10-7 The north side of Vintage from 180 feet east of Taylor Canon Place to Day Creek. The east side of Day Creek from Vintage to Banyan. The south side of Banyan from Day Creek. Ground Cover area: 22,164 square feet Hardscape area: 11,724 square feet 10-8 The landscape against the south side facing wall north of the 210 freeway from the top of the slope on the east side of Day Creek to 300 feet eastward. The Day Creek median from the 210 freeway to Vintage. The east side of Day Creek from Caltrans ROW to Vintage. The south side of Vintage from Day Creek to 180 feet east of Taylor Canyon. Ground Cover area: 16,841 square feet Hardscape area: 7,025 square feet 10-9 The north side of Coyote from Brooks tone Place to Day Creek. The east side of Day Creek from Coyote to 358 feet north of Coyote. The west side of Day Creek from 118 feet north of Coyote to 380 feet north of Coyote. Ground Cover area: 9,403 square feet Hardscape area: 6,052 square feet *This site previously had 8,488 square feet of ground cover and 5,752 of Hardscape prior to the addition of the area on the west side of Day Creek. 10-10 The north side of Wilson from 395 feet east of Day Creek to Day Creek. The eastside of Day Creek from Wilson to Blackstone. The south side of Blackstone from Day Creek to Stoneview. The north side of Blackstone from Day Creek to 165 feet west of Landscape Maintenance District No. 10—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P435 Stoneview. Ground Cover area: 26,304 square feet Hardscape area: 19,117 square feet 10-11 The west side of Day Creek from 340 feet north of Banyan to Banyan. The north side of Banyan from Day Creek to Rocking Horse. Ground Cover area: 20,378 square feet Hardscape area: 11,212 square feet 10-12 The paseo on the east side of Stoneview Rd. across from Duncaster PI. Ground Cover area: 3,326 square feet Hardscape area: 2,374 square feet Ground cover, shrubs and turf areas that make up parkways, median islands and paseos are maintained under contract by a private landscape maintenance company. Parks are maintained by the City's Park Maintenance Crews. Map of Improvements The following page shows the map of landscaping improvements, including irrigation sites and community trails, to be maintained using District funds. Landscape Maintenance District No. 10—City of Rancho Cucamonga 7 Fiscal Year 2013/14 A I Landscape Maintenance District No. 10 P4 36 Improvement Ma N 1D42 70-1 C��v 10-10 '6 10-2 WILSONAV 103 104 Q70d ,.amk emdth e.cp.vC MfR—h, ces eY re mm.yr m.cYY.IFnm.cr,.,m..w mb n..urc..l w..mi mMm.m.. m.cm�orn.znocowm..ymars xr.rRr.upneN.k. ,.t.—ner .-0.sr �PU.np,scu.q pNt.rv.o,tinNn.tt o1 n rm•!Im p.,H.E b Y.0 ks.n.tlr1 ua.k.WE n.i mlY upm Nr.IMami�m lot any�.x.n aM k Jirege 0l. nE.0"0A/11h,C1y MI•.Mom.WIp n.1k pkn. J ik.Lry dP,..�.[u..... vpbY/.nC Nh.N inR.Nn akwm.•nv•ne a r.prrs.Mn.tt.�a wnum...,mcsanp. Y em..1 P.n.an. P,_ T.NS.mmxm.m.e.q..e �W .p.nl.ubrr N cq. m.a ..w W CRE K 0_ PA K u.emfeKO. an c U .+•ttee lrt,Nm Q10-7 10L Q WATER METER A IRRIGATION PUMP Pacific Electric Trail 108 IRRIGATION LINE - PARKS LIVID 10 BOUNDARY — MAJOR STREET 7.loot, zjo oFRc i zio Fw FREEWAY zao;orRP 2500NRP PARCELS HIGHLAND AV Landscape Maintenance District No. 10—City of Rancho Cucamonga 8 Fiscal Year 2013/14 P437 ESTIMATE OF COSTS The estimated costs of administration, maintenance, operations, and servicing the improvements as described in the Plans and Specifications are summarized below. Each year, as part of the assessment district levy calculation process, the costs and expenses are reviewed and the annual costs are projected for the following fiscal year. District Budget Estimated 2013/14 Budget Personnel Services Regular Salaries $ 133,920.00 Overtime Salaries 1,050.00 Part-time Salaries 27,590.00 Fringe Benefits 66.490.00 Subtotal Personnel $ 229,050.00 Operations and Maintenance Operations and Maintenance $ 36,800.00 Operations and Maintenance/Facilities 4,000.00 O & M/Computer Equipment 0.00 Cellular Technology 360.00 Emergency Equipment& Vehicle Rental 1,000.00 Emergency Operations and Maintenance 1,000.00 Contract Services 140,280.00 Contract Services/Facilities 2,000.00 Tree Maintenance 15,260.00 Utilities Water Utilities 87,160.00 Electric Utilities 64,690.00 Assessment Administration 4,260.00 General Overhead 48,750.00 Subtotal Operations and Maintenance $ 405,560.00 Capital Expenditures Capital Outlay— Equipment $ 6,200.00 Capital Projects $ 0.00 Subtotal Capital Expenditures $ 6,200.00 Total District Expenditure Budget $ 640,810.00 Total Estimated Assessment $ 476,940.00 Less Anticipated Delinquency Penalty 5 8( 10.00) Total Estimated Revenue $ 461,740.00 Plus Operating Reserve Fund Contribution 169,680.00 Total Expenditure Budget $ 640,810.00 Total Estimated Assessment $ 476,940.00 Total District EBU Count 774.00 Actual Assessment per EBU —Fiscal Year 2013/14 $ 616.20 Maximum Allowable Assessment per EBU— Fiscal Year 2013/14 $ 821.46 Landscape Maintenance District No. 10—City of Rancho Cucamonga 9 Fiscal Year 2013/14 P438 Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. The actual assessment per EBU will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment with the goal of maintaining the improvements in a satisfactory and healthy condition. The actual assessment amount may be lower than the maximum allowable assessment; however it may not exceed the maximum unless the increase is approved by the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Operating Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund Balance $ 972,490.00 Operating Reserve Contribution — Fiscal Year 2013/14 (169,680.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund Balance $ 802,800.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the District improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Operations and Maintenance: This item includes the costs of City staff to perform maintenance duties within the boundaries of the District. Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the District improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the District. Utilities -Water: This item includes the costs to furnish water for the landscaping within the District. Landscape Maintenance District No. 10—City of Rancho Cucamonga 10 Fiscal Year 2013/14 P439 Utilities - Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Proiects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half of the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Landscape Maintenance District No. 10—City of Rancho Cucamonga 11 Fiscal Year 2013/14 P440 METHOD OF ASSESSMENT General Pursuant to the 1972 Act and Article XIII D. all parcels that have a special benefit conferred upon them as a result of the maintenance and operation of improvements and services shall be identified, and the proportionate special benefit derived by each identified parcel shall be determined in relationship to the entire costs of the maintenance and operation of improvements. The 1972 Act, permits the establishment of assessment districts for the purpose of providing certain public improvements which include the operation, maintenance and servicing of landscaping improvements. Section 22573 of the 1972 Act requires that maintenance assessments must be levied according to benefit rather than according to assessed value. This Section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefit to be received by each such lot or parcel from the improvements." The determination of whether or not a lot or parcel will benefit from the improvements shall be made pursuant to the Improvement Act of 1911 (Division 7 (commencing with Section 5000) [of the Streets and Highways Code, State of California]." The 1972 Act also permits the designation of zones of benefit within any individual assessment district if"by reasons or variations in the nature, location, and extent of the improvements, the various areas will receive different degrees of benefit from the improvement' (Sec. 22547). Article XIII D, Section 4(a) of the California Constitution limits the amount of any assessment to the proportional special benefit conferred on the property. Article XIII D also provides that publicly owned properties must be assessed unless there is clear and convincing evidence that those properties receive no special benefit from the assessment. Exempted from the assessment would be the areas of public streets, public avenues, public lanes, public roads, public drives, public courts, public alleys, public easements and rights-of-ways, public greenbelts and public parkways. The net amount to be assessed may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels. Proposition 218, approved by the voters in November 1996, requires the City to separate general benefit from special benefit, where only special benefit is assessed. General Benefit Section 4 of Article XIII D of the California Constitution provides that once a local agency which proposes to impose assessments on property has identified those parcels that will have special benefits conferred upon them and upon which an assessment will be imposed, the local agency must next "separate the general benefits from the special benefits conferred," and only the special benefits can be included in the amount of the assessments imposed. Landscape Maintenance District No. 10—City of Rancho Cucamonga 12 Fiscal Year 2013/14 P441 In this Assessment District, the improvements being financed consists of the maintenance of local improvements located within the boundaries of the District and include paseos, street trees, landscaped areas and appurtenant facilities that are located throughout the District and were installed to create a common landscape theme and neighborhood identity for parcels within the District. The improvements are situated within the public rights-of-way of the internal local street network within the District which provides ingress and egress for parcels within the District to access the City's system of arterial streets. City residents and traffic from parcels not within the District do not use the internal local street network or paseos except for the express purpose of accessing properties located within the District, and therefore do not benefit from the improvements. Only parcels which are within the District and proximate to the improvements and within the Assessment District are being assessed. Accordingly, there is a direct physical and visual nexus between each parcel being assessed and the improvements to be funded by the assessment that does not exist for parcels outside of the District boundary and that is particular and distinct from that shared by the public at large. Under these circumstances, all of the benefits conferred are direct and local in nature, and provide a benefit to only those parcels located within the boundaries of the District. Based upon this, it has determined that there is no quantifiable general benefit to the surrounding community and the public in general from the maintenance of the improvements within the boundaries of the District, and therefore no portion of the project costs should be attributed to general benefit. Special Benefit The maintenance and servicing of the improvements within the District (which are described in the Description of Improvements and Services Section of this report) are for the benefit of the properties within the District, and as such confer a special and direct benefit to parcels within the District by: • improving the livability, appearance, and desirability for properties within the boundaries of the District, and • ensuring that improvements do not reach a state of deterioration or disrepair so as to be materially detrimental to properties within the District, and • providing beautification, shade and overall enhancement to properties within the District. The above mentioned items affect the assessed property in a way that is particular and distinct from their effect on other parcels and that real property in general and the public at large do not share. They contribute to a specific enhancement of the properties within the District. Since these improvements, including the community trails, were installed and are maintained specifically for the properties within the District; only properties within the District receive a special benefit and are assessed for said maintenance. Method of Assessment Spread Each of the parcels within the District is deemed to receive special benefit from the improvements. Each parcel that has a special benefit conferred upon it as a result of the maintenance and operation of improvements are identified and the proportionate special benefit derived by each identified parcel is determined in relationship to the entire costs of the maintenance and operation of the improvements. Landscape Maintenance District No. 10—City of Rancho Cucamonga 13 Fiscal Year 2013/14 P442 To assess special benefit appropriately, it is necessary to relate the different type of parcel improvements to each other. The Equivalent Benefit Unit ("EBU") method of apportionment uses the single family home as the basic unit of assessment. A single family home equals one Equivalent Benefit Unit (EBU). Every other land-use is converted to EBUs based on an assessment formula that equates to the property's specific development status, type of development (land-use), and size of the property, as compared to a single family home. The following table provides the weighting factors applied to various land- use types, as assigned by County use code, to determine each parcel's EBU assignment. Land-Use Equivalent Dwellin Units Property Type (County Use Code) EBU Value Multiplier Single Family Residential 1.00 Dwelling Unit The use of the latest County Assessor's Secured Roll shall be the basis for the Property Type determination and units/acreage assignments, unless better data is available to the City. In addition, if any parcel within the District is identified by the County Auditor/Controller to be an invalid parcel number for the current fiscal year, the Property Type and EBU assignment shall be based on the correct parcel number and/or new parcel number(s) County use code and subsequent property information. If a single parcel has changed to multiple parcels, the EBU assignment and assessment amount applied to each of the new parcels will be recalculated rather than spread the proportionate share of the original assessment. The following summarizes the Fiscal Year 2013/14 maximum allowable assessment rates for the District: Maximum Allowable Property Type Assessment Rate Actual Assessment Total Ttal (County Use Code per EBU Rate per EBU Units/Acres [EBO Us Single Family Residential $821.46 $616.20 774.00 774.00 The following table reflects both the maximum allowable assessment and the actual assessment rates for each year since the formation of the district and the proposed assessment rate for fiscal year 2013/14 for the District: Landscape Maintenance District No. 10—City of Rancho Cucamonga 14 Fiscal Year 2013/14 P443 Fiscal Year Maximum Assessment per EBU Actual Assessment per EBU 2001/02 $597.09 $597.09 2002103 613.69 597.09 2003/04 637.75 597.09 2004/05 648.93 597.09 2005/06 675.03 597.09 2006/07 706.54 597.09 2007/08 733.65 616.20 2008/09 757.73 616.20 2009/10 757.73 616.20 2010/11 771.79 616.20 2011/12 771.79 616.20 2012/13 787.94 616.20 2013/14 821.46 616.20 The total amount of maintenance and incidental costs for maintaining the landscaping and community trail improvements is assessed to the individual parcels of real property within the District in proportion to the special benefit received by such parcels of real property. The proposed individual assessments are shown on the assessment roll in this report. Cost of Living Inflator Each fiscal year beginning with Fiscal Year 2002/2003, the amount of the assessment for the District has increased each year, based upon the Consumer Price Index ("CPI"), All Urban Consumers, for the Los Angeles-Anaheim-San Bernardino Area, as determined by the United States Department of Labor, Bureau of Labor Statistics, or its successor. The Engineer shall compute the percentage difference between the CPI for March of each year and the CPI for the previous March, and shall then adjust the existing assessment by an amount not to exceed such percentage for the following fiscal year. Should the Bureau of Labor Statistics revise such index or discontinue the preparation of such index, the Engineer shall use the revised index or a comparable system as approved by the City Council for determining fluctuations in the cost of living. If for any reason the percentage change is negative the maximum allowable assessment would not be decreased by reason of such negative percentage change and would remain at the amount as computed on the previous fiscal year regardless of any CPI adjustment. The annual assessment cannot exceed the actual costs to operate the District in any given year. If operating costs are such that the maximum assessment amount is not needed, the City would levy only what is needed for that year. The assessment rate for Fiscal Year 2013/14 will not increase. Landscape Maintenance District No. 10—City of Rancho Cucamonga 15 Fiscal Year 2013/14 P444 ASSESSMENT DIAGRAM An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Landscape Maintenance District No. 10—City of Rancho Cucamonga 16 Fiscal Year 2013/14 P445 bt/£ZOZ AeaA leis!j Li e8uowean0 oyau"jo Ajp—of 'oN »uls!p aoueualu!ew adeaspuej r.r .i 42 O AV AJIGqo 0) yr J 0 i ED o � r 3 w i m ^°o Q LL AV Ise3 6 C � L C 1 v J nV epuerovF3' `---- AV epuera113 a L„= AV Jals94008 - ny Jalsayoot{ AV UGH111!W ( AV ua11!11!W } 1 i i ny uaneH i AV esowiaH -- 'AV esowtaH 1 AV pley!4ojV — --- AV Pley!43JV AV uewllaH nV uewllaH 1-- l (D v AV pjeAau!n IS ue!laweo IL- nV anoJE) m it in t�1 J L O a0 'a c m Q f i jFft {i ' t�tFii}t�f 1l� 4 m i�l9;i"��IIF:f itF(� 3 lit s fi't a 7� C IsS i " n P446 ASSESSMENT ROLL Assessment Roll The assessment roll is a listing of the assessment for Fiscal Year 2013/14 apportioned to each lot or parcel, as shown on the last equalized roll of the Assessor of the County of San Bernardino. The following tables summarize the Fiscal Year 2013/14 maximum and actual assessments for the District: Maximum Allowable Maximum Property Type Assessment Rate Total Total Allowable —(County Use Code per EBU Units/Acres EBUs Assessment Single Family Residential $821.46 774.00 774.00 $635,810.04 Actual Property Type Assessment Rate Total Total Actual —(County Use Code Per EBU Units/Acres EBUs Assessment Single Family Residential $616.20 774.00 774.00 $476,938.80 A copy of the full assessment roll is available for review in the City Clerk's office. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Landscape Maintenance District No. 10—City of Rancho Cucamonga 18 Fiscal Year 2013/14 P447 STAFF REPORT ADMINISTRATNE SFRVICES GROUP RANCHO CUCAMONGA Date: July 3, 2013 To: Mayor and Members of the City Council John R. Gillison, City Manager From: Lori E. Sassoon, Deputy City Manager By: Ingrid Y. Bruce, GIS/Special Districts Manager Subject: CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMENTS, PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORT, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC HEARING THEREON. NO INCREASE OF ASSESSMENT RATES FOR FY 2013/14 IS PROPOSED OR PERMITTED. RECOMMENDATION: It is recommended that City Council approve the Resolutions ordering the preparation of the Annual Engineer's Reports to initiate proceedings to levy annual assessments, preliminarily approve the Annual Engineer's Report, declaring the City Council's intention to levy annual assessments within Park and Recreation Improvement District No. PD-85. There is no increase to the current rates for Fiscal Year 2013/2014 proposed or permitted. The Engineer's Report is also on file in the City Clerk's Office. BACKGROUND/ANALYSIS: PD-85 was originally created to provide funds to finance the cost of construction, maintenance, operation and debt payment of Heritage Community Park and Red Hill Community Park. Heritage Community Park is a 40-acre facility located on the southwest corner of Hillside Road and Beryl Street. Red Hill Community Park is 42 acres and is located on the southwest corner of Base Line Road and Vineyard Avenue. The District's boundary includes all of the City of Rancho Cucamonga with the general exception of land east of the Deer Creek Channel and the Victoria, Caryn and Terra Vista Planned Communities. The final debt service payment on the bonds that were sold to finance the construction of Red Hill and Heritage Community Parks was paid on September 1, 2005. Subsequently with the debt repaid the annual assessments were decreased for all the property owners. The annual assessments levied and collected are dedicated to the on-going maintenance and operation, with periodic capital improvement expenditures, of the parks. Therefore, pursuant to the Landscape and Lighting Act of 1972, each year the City Council must adopt resolutions initiating proceedings to P448 CONSIDERATION OF APPROVAL OF RESOLUTIONS ORDERING THE PREPARATION OF PA(A;2 THE ANNUAL ENGINEER'S REPORTS TO INITIATE PROCEEDINGS TO LEVY ANNUAL ASSESSMENTS,PRELIMINARILY APPROVE THE ANNUAL ENGINEER'S REPORT, DECLARING THE CITY COUNCIL'S INTENTION TO LEVY ANNUAL ASSESSMENTS WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO.PD-85 FOR FISCAL YEAR 2013/14 AND SETTING THE TIME AND PLACE FOR A PUBLIC HEARING THEREON. NO INCREASE OF ASSESSMENT RATE FOR FY 2013/14 IS PROPOSED. j uLY 3,2013 levy the assessments, approve the Annual Engineer's Report and declare its intention to levy and collect assessments for the upcoming fiscal year. Because PD-85 contains no provision for an increase in annual assessments, regardless of how little or how much costs, including water, electricity and contract services, change, the district is currently experiencing a significant budget deficit. Reserves are rapidly being depleted and are projected to fall to $481,700.00 as of June 30, 2014. This level of reserves is inadequate on a long- term basis and the current structural deficit must be addressed as an urgent matter during FY 2013/14. Staff will be bringing recommendations in the late summer to address the sustainability of this District into the future. Assessments for PD-85 will be levied according to the following schedule: Definition Assessment per Parcel Single Family Residential $31.00 Multi-Family Residential $31.00 Less than 1.50 acres $15.50 1.51 acres to 3.50 acres $46.50 3.51 acres to 7.00 acres $108.50 7.01 acres to 14.00 acres $217.00 14.01 acres to 25.00 acres $434.00 25.01 acres and larger $775.00 Attachments Resolutions Engineer's Report P449 RESOLUTION NO. 13-103 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE PREPARATION OF ANNUAL ENGINEER'S REPORT PURSUANT TO THE PROVISIONS OF THE ASSESSMENT LAW FOR PROCEEDINGS FOR THE ANNUAL ASSESSMENT LEVY WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 FOR FISCAL YEAR 2013/14 WHEREAS, the City Council of the City of Rancho Cucamonga, California, previously undertaken proceedings to form and has formed that certain maintenance district pursuant to pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act"), known and designated as Park and Recreation Improvement District No. PD-85 (the "District"); and WHEREAS, at this time the City Council desires to initiate proceedings pursuant to Chapter 3 of the 1972 Act to provide for the annual levy of assessments for the next ensuing fiscal year to provide for the annual costs for maintenance and servicing of improvements within the District; and WHEREAS, the proceedings for the annual levy of assessments shall relate to the fiscal year commencing July 1, 2013, and ending June 30, 2014 ("Fiscal Year 2013/14"). NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. New Improvements or Substantial Changes in Existing Improvements. No new improvements are proposed to be added to the improvements to be maintained or serviced and no substantial changes in the existing improvements are proposed to be made for Fiscal Year 2013/14. SECTION 3. Annual Engineer's Report. The City Engineer is hereby ordered to prepare and file with this City Council an Annual Engineer's Report for the District relating to such annual assessment and levy in such District in accordance with the provisions of 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"). SECTION 4. Filing of the Annual Engineer's Report. Upon completion, the Annual Engineer's Report for the District shall be filed with the City Clerk, who shall then submit the same to this City Council for its consideration pursuant to the Assessment Law. P450 PASSED, APPROVED AND ADOPTED this day of July, 2013 AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on 12013. Executed this at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P451 RESOLUTION NO. 13-104 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, PRELIMINARILY APPROVING THE ANNUAL ENGINEER'S REPORT FOR THE ANNUAL LEVY OF ASSESSMENTS WITHIN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 FOR FISCAL YEAR 2013114 WHEREAS, the City Council of the City of Rancho Cucamonga, California, pursuant to the provisions of Division 15, Part 2 of the Streets and Highways Code of the State of California (the "1972 Act"), Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), did, by previous Resolution, order the preparation of a report for the annual levy of assessments for Fiscal Year 2013/14 (the "Annual Engineer's Report") in a certain maintenance assessment district known and designated as Park and Recreation Improvement District No. PD 85 (the "District"); and WHEREAS, there has now been presented to this City Council the Annual Engineer's Report for the District as required by the Assessment Law and as previously directed by Resolution; and WHEREAS, this City Council has now examined and reviewed the Annual Engineer's Report as presented, and is satisfied with each and all of the items and documents as set forth in such report, and is satisfied that the assessments on a preliminary basis, have been spread within the District in accordance with the special benefits received from the improvements to be maintained and serviced, as set forth in the Annual Engineer's Report. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Annual Engineer's Reports. The Annual Engineer's Report for the District as presented, consisting of the following: A. Plans and specifications describing the general nature, location and extent of the improvements to be maintained and serviced and the extent of such maintenance; B. An estimate of the cost of the maintenance of the improvements for the District for Fiscal Year 2013/14; C. A diagram for the District, showing the area and properties proposed to be assessed; and P452 D. An annual assessment for Fiscal Year 2013/14 of the estimated costs of the maintenance and servicing of those improvements to be maintained and serviced during such Fiscal Year, assessing the net amount upon all assessable lots and/or parcels within such District in proportion to the special benefits received is hereby approved on a preliminary basis and is ordered to be filed in the Office of the City Clerk as a permanent record and to remain open for public inspection. SECTION 3. The City Clerk shall certify to the passage and adoption of this Resolution, and the minutes of this meeting shall so reflect the presentation of the Annual Engineer's Report. PASSED, APPROVED AND ADOPTED this day of July 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P453 RESOLUTION NO. 13-105 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, DECLARING ITS INTENTION TO PROVIDE FOR THE ANNUAL LEVY AND COLLECTION OF ASSESSMENTS FOR FISCAL YEAR 2013/2014 IN PARK AND RECREATION IMPROVEMENT DISTRICT NO. PD-85 AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING THEREON WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed that certain maintenance district and authorized the levy of assessments therein pursuant to the terms and provisions of the "Landscaping and Lighting Act of 1972," being Division 15, Part 2 of the Streets and Highways Code of the State of California (commencing with Section 22500) (the "1972 Act") in what is known and designated as Park and Recreation Improvement District No. PD 85 (the "District"); and WHEREAS, this City Council has initiated proceedings to provide for the annual levy of assessments for Fiscal Year 2013/14, to finance the costs and expenses necessary for continued maintenance and servicing of improvements within the District; and WHEREAS, at this time, there has been presented and approved by this City Council, a separate report for the District identified by the distinctive designation of such District and entitled "Fiscal Year 2013/14 Annual Engineer's Report" (the "Annual Engineer's Report") as required pursuant to Article 4 of Chapter 1 of the 1972 Act, Article XIIID of the Constitution of the State of California ("Article XIIID") and the Proposition 218 Omnibus Implementation Act (Government Code Section 53750 and following) (the "Implementation Act") (the 1972 Act, Article XIIID and the Implementation Act are referred to collectively as the "Assessment Law"), and this City Council desires to conduct the proceedings to authorize the levy of the annual assessments within the District; and WHEREAS, the annual assessments for Fiscal Year 2013/14 proposed to be levied within the District as set forth in the report do not exceed the annual assessments as previously authorized to be levied within such District and, therefore, the proposed levy of assessments for Fiscal Year 2013/14 within such District are not deemed to be "increased" over the maximum authorized annual assessments. NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, as follows: SECTION 1. Recitals. The above recitals are all true and correct. SECTION 2. Improvements and Maintenance and Servicing Thereof. The public interest and convenience requires, and it is the intention of this City Council, to undertake proceedings for the annual levy and collection of assessments within the District for the continued maintenance and servicing of the improvements authorized to be maintained and serviced within such District. "Maintenance" may include the furnishing of services and materials for the ordinary and usual maintenance, operation, and servicing of any improvement, including: (a) repair, removal, or replacement of all or any part of any improvement; (b) providing for the life, growth, health, P454 and beauty of landscaping, including cultivation, irrigation, trimming, spraying, fertilizing, or treating for disease or injury; (c) the removal of trimmings, rubbish, debris, and other solid waste; and, (d) the cleaning, sandblasting, and painting of walls and other improvements to remove or cover graffiti. "Service" may include the furnishing of: (a) electric current or energy, gas, or other illuminating agent for the lighting or operation of any improvements; and, (b) water for the irrigation of any landscaping, the operation of any fountains, or the maintenance of any other improvements. A description of the improvements to be maintained and the maintenance and services to be provided is set forth in Appendix A attached hereto and incorporated herein by this reference. SECTION 3. Annual Engineer's Report. The Annual Engineer's Report regarding the annual levy for the District for Fiscal Year 2013-2014, has been preliminarily approved and directed to be filed in the office the City Clerk. Reference is made to such Report for the District for a full and detailed description of the improvements to be maintained and serviced, the boundaries of such District and any zones therein, and the proposed assessments upon assessable lots and parcels of land within such District. SECTION 4. Assessment. The public interest and convenience requires, and it is the intention of this City Council to order the annual levy of assessments for the District as set forth and described in the Annual Engineer's Report, and further it is determined to be in the best public interest and convenience to levy and collect annual assessments to pay the costs and expenses of such maintenance and service as estimated in such Annual Engineer's Report. SECTION 5. Boundaries of District. The proposed maintenance and service work as described in the Annual Engineer's Report for the District is, in the opinion of this City Council, of special benefit to the properties within the boundaries of such District, and this City Council makes the costs and expenses of such maintenance and service chargeable upon such District, which District said City Council hereby declares to be the District specially benefited by such maintenance and service, and to be further assessed pursuant to the Assessment Law to pay the costs and expenses thereof. The District shall include each and every parcel of land within the boundaries thereof; as such District is shown on a map or maps as approved by this City Council and on file in the Office of the City Clerk, and so designated by the name of such District. SECTION 6. Public Hearing. Notice is hereby given that a public hearing will be held the 17" day of July, 2013, at the hour of 7:00 o'clock p.m. or as soon thereafter as the matter may be heard, in the regular meeting of the City Council, being in the Council Chambers located at 10500 Civic Center Drive, Rancho Cucamonga, California, which is the time and place fixed by this City Council for the hearing of protests or objections in reference to the annual levy of assessments, to the extent of the maintenance, by any interested person and any other matters contained in this resolution. Any persons who wish to object to the proceedings for the annual levy should file a written protest with the City Clerk prior to the time set and scheduled for said public hearing. P455 SECTION 7. For Information Regarding Proceedings. For any and all information relating to the proceedings, protest procedure, any documentation and/or information of a procedural or technical nature, your attention is directed to the below listed person at the City: Ingrid Bruce GIS/Special Districts Manager City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, CA 91730 (909) 477-2700, Ext 2575 SECTION 8. Notice. The City Clerk is hereby authorized and directed to publish, pursuant to Government Code Section 6061, a copy of this Resolution in the Inland Valley Daily Bulletin, a newspaper of general circulation within said City, said publication shall be made one time and not less than ten (10) days before the date set for the Public Hearing. PASSED, APPROVED AND ADOPTED this day of July, 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on , 2013. Executed this at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk P456 Appendix A Descriptions of Improvements and Maintenance and Services This Appendix A contains a general description of the improvements to be maintained and serviced and a description of such maintenance and services. 1. The maintenance and operation of Heritage Community Park including, but not limited to, grading, planting, irrigation, onsite roads, sidewalks, parking lots, lighting, restrooms, equestrian facilities, playground equipment, picnic facilities, athletic facilities, and walking, jogging and equestrian trails and sanitary sewer connections. 2. The maintenance and operation of Red Hill Community Park including, but not limited to, grading, planting, irrigation, onsite roads, sidewalks, parking lots, lighting, waterscape, restrooms, senior citizen facilities, playground equipment, picnic facilities, major lighted athletic facilities, jogging trail, sanitary sewer connections and onsite drainage inlets. A - 1 P457 Annual Engineer's Report Fiscal Year 2013/2014 City of Rancho Cucamonga Parks and Recreation Improvement District No. PD-85 0 Mark A. Steuer, Director of Engineering Services/City Engineer P458 CITY OF RANCHO CUCAMONGA PARK AND RECREATION DISTRICT NO. PD-85 10500 Civic Center Drive Rancho Cucamonga, CA 91730 Phone: 909.477.2740 Fax: 909.477.2741 CITY COUNCIL L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tern William Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member CITY STAFF John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Lori E. Sassoon, Deputy City Manager/Administrative Services William Wittkopf, Public Works Director Ingrid Y. Bruce, GIS/Special Districts Manager Christopher Bopko, Management Analyst III P459 TABLE OF CONTENTS Authority for Report 1 Findings f District Analysis 2 Estimate of Work 3 Method of Spread 6 Annexations 7 Boundary Map 7 P460 AUTHORITY FOR REPORT This report for the 2013/2014 fiscal year is prepared pursuant to the order of the City Council of the City of Rancho Cucamonga and in compliance with the requirements of Article 4, Chapter 1, Landscape and Lighting Act of 1972, being Division 15, Section 22500 of the Streets and Highways code. Provisions for this annual assessment are included in Chapter 3 of the Landscape and Lighting Act of 1972. The purpose of this report is to set forth findings and the assessment analysis for the annual levy of assessments for the Park and Recreation Improvement District No. PD-85 thereafter referred to as "the District". This District, using direct benefit assessments, was originally created to provide funds to finance the cost of construction, maintenance, operation and debt payment of Heritage Community Park and Red Hill Community Park in the City of Rancho Cucamonga. Subsequently the debt has been repaid with only the ongoing maintenance and operation with periodic capital improvement expenditures of the parks remaining. FINDINGS Section 22573, Landscape and Lighting Act of 1972, requires assessments to be levied according to benefit rather than according to assessed value. The section states: "The net amount to be assessed upon lands within an assessment district may be apportioned by any formula or method which fairly distributes the net amount among all assessable lots or parcels in proportion to the estimated benefits to be received by each such lot or parcel from the improvements." The means of determining whether or not a parcel will benefit from the improvements is contained in the Improvement Act of 1911 (Division 7, commencing with Section 5000 of the Streets and Highways Code, State of California). The 1972 Act also provides for the classification of various areas within an assessment district into benefit areas where, by reason of variations in the nature, location, and extent of the improvements, the various areas will receive differing degrees of all territory receiving substantially the same degree of benefit from the improvements and may consist of contiguous or noncontiguous areas. As the assessments are levied on the bases of benefit, they are considered a user's fee, not a tax; and, therefore, are not governed by Article XIIIA. Properties owned by public agencies, such as a city, county, state, or the federal governments is not assessable without the approval of the particular agency and, normally, are not assessed. Certain other parcels used for railroad mainline right-of-way, public utility transmission right-of-way, and common areas are also exempt from assessment. The assessment for mobile home parks will be based upon underlying lot acreage. Land Scape Maintenance District No. 2—City of Rancho Cucamonga 1 Fiscal Year 2013/14 P461 DISTRICT ANALYSIS A. District Boundary The district includes all of the City of Rancho Cucamonga with the general exception of land east of Deer Creek Channel and the Victoria, Caryn & Terra Vista Planned Communities. All parcels of real property affected are more particularly described in maps prepared in accordance with Section 327 of the Revenue and Taxation Code, which are on file in the office of the San Bernardino County Assessor in the Hall of Records, 172 West Third Street, San Bernardino, California and which are hereby made a part hereof by reference. B. District Name City of Rancho Cucamonga Park and Recreation Improvement District No. PD—85. C. Facilities The existing works within the District boundary are generally described as follows: 1. The maintenance and operation of Heritage Community Park including, but not limited to, grading, planting, irrigation, onsite roads, sidewalks, parking lots, lighting, restrooms, equestrian facilities, playground equipment, picnic facilities, athletic facilities, and walking, jogging and equestrian trails and sanitary sewer connections. 2. The maintenance and operation of Red Hill Community Park including, but not limited to, grading, planting, irrigation, onsite roads, sidewalks, parking lots, lighting, waterscape, restrooms, senior citizens facilities, playground equipment, picnic facilities, major lighted athletic facilities, jogging trail, sanitary sewer connections and onsite drainage inlets. Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 2 Fiscal Year 2013/14 P462 ESTIMATE OF WORK The Landscaping and Lighting Act of 1972 permits carrying forward surpluses or recovering deficits in subsequent fiscal years. Costs for the district will be reviewed annually. Any surplus credited against assessment or any deficits shall be included in the assessment for the following fiscal year. Proposed Maintenance Budget: FY 2013/2014 PROJECTED REVENUE $1.243.740.00 Personnel Services Regular Salaries $587,460.00 Overtime Salaries 3,680.00 Part Time Salaries 78,430.00 Fringe Benefits 286.250.00 Subtotal $955,820.00 Operations & Maintenance Operations & Maintenance $119,750.00 Operations & Maintenance — Facilities 5,000.00 Vehicle Operations & Maintenance 1,000.00 Emergency Equipment & Veh. Rntl 3,000.00 Equip Operations & Maint. 10,000.00 Contract Services 33,540.00 Contract Services/Facilities 0.00 Tree Maintenance 18,200.00 Telephone Utilities 7,030.00 Water Utilities 248,320.00 Electric Utilities 93,330.00 Assessment Administration 153,430.00 Admin./General Overhead 115.780.00 Subtotal $808,380.00 Capital Outlay Capital Outlay— Improv. Other than Bldg 0.00 Subtotal 0.00 Total PD-85 Expenditure Budget $1,764,200.00 Operating Reserve Contribution -520,460.00 -------------------------------------------------------------------------------------------------- Projected Revenue (includes projected $1,243,740.00 delinquencies and interest & penalties) Total District Assessment $1,149.430.00 Total District Parcel Count 27,896 Each year, prior to the assessments being placed on the tax roll, the City will review the budget and determine the amount needed to maintain the improvements for the upcoming fiscal year. Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 3 Fiscal Year 2013/14 P463 The actual assessment will be based on the estimated costs of maintenance, available fund balance and maximum allowable assessment; however it may not exceed the maximum unless the increase is approved y the property owners in accordance with Proposition 218. It is the intent of the City of Rancho Cucamonga to maintain an Opening Reserve which shall not exceed the estimated costs of maintenance and servicing of the improvements prior to December 10 of the fiscal year, or when the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The reserve balance information for the District is as follows: Estimated Fiscal Year Ending June 30, 2013 Reserve Fund $1,002,160.00 Operating Reserve Contribution — Fiscal Year 2013/14 (520,460.00) Operating Reserve Collection — Fiscal Year 2013/14 0.00 Estimated Fiscal Year Ending June 30, 2014 Reserve Fund $481,700.00 Definitions of Budget Items The following definitions describe the costs and expenses included in the District Budget: Personnel Services Regular Salaries: This item includes the costs attributed to the salaries of all full-time employees dedicated to maintenance of the District improvements. Overtime Salaries: This item includes costs attributed to work performed by full-time employees over and above their normal scheduled hours. Part Time Salaries: This item includes the costs attributed to the salaries of all part time employees dedicated to maintenance of the parks improvements. Fringe Benefits: This item includes the benefits available to City employees: health care, vacation, sick time, and retirement fund. Operations and Maintenance Contract Services: This item includes the contract costs of a landscape maintenance company responsible for the ongoing maintenance of the parks improvements. Tree Maintenance: This item includes the contract costs attributed to maintaining the street trees and other trees throughout the parks. Utilities —Water: This item includes the costs to furnish water for the landscaping and parks. Utilities — Electric: This item includes the costs to furnish electricity required for the operation and maintenance of the parks lighting, sprinklers and irrigation controllers. Assessment Administration: This item includes the cost to all particular departments and staff of the City, and consultants for providing the administration, coordination and management of Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 4 Fiscal Year 2013/14 P464 District services, operations, and incidental expenses related to the District. This item also includes creation of an annual engineer's report, resolutions and placing the assessment amounts onto the County Tax roll each year, along with responding to any public inquiries and future Proposition 218 balloting proceedings. General Overhead: This item includes the costs of all departments and staff of the City for providing the coordination of District services, inspections, annual bid management, responding to public concerns, public education, accounting, auditing and procedural matters associated with the District. This item also includes an allocation for general City staff time for administrative functions and systems that provide for a functional and operational assessment district within the City's administrative structure. Capital Expenditures: Capital Projects: This item includes new improvements to further enhance the level and quality of service provided within the boundaries of the District. This may include new monuments, irrigation systems, and other large improvements. Operating Reserve Collection: Operating Reserve Collection: This item includes the amount to be collected to maintain reserves to enable the City to pay for the maintenance and servicing of the improvements prior to December 10 of the fiscal year, or whenever the City expects to receive its apportionment of special assessments and tax collections from the County, whichever is later. The Reserve Fund contribution will continue until such a time the Reserve Fund balance is approximately one half the annual costs. The fund may be allowed to accumulate in anticipation of any unforeseen expenses not included in the yearly maintenance costs. This may include, but is not limited to, tree replacements, repair of damaged equipment due to vandalism, storms and other similar events. Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 5 Fiscal Year 2013/14 P465 METHOD OF SPREAD The Landscaping and Lighting Act of 1972 indicates that assessments may be apportioned by any formula or method which fairly distributes costs among all lots or parcels within the District in proportion to the estimated benefit received. A. Definitions The District is divided into three categories for the purpose of determining the assessments as follows: CATEGORY A — includes parcels based on the number of existing residential units within certain ranges of parcel size. CATEGORY B— includes all parcels not defined in Category A or Category C CATEGORY C — includes exempt parcels. Exempt parcels are those parcels listed by the County Assessor's as exempt and/or which have an assessed value of less than $500. B. Formula The assessment formula is based on actual land use information contained in the current San Bernardino Assessor's computer files and Assessor's parcel maps. Category A: All parcels containing existing residential dwelling units and meeting the following conditions. Parcel Size/Range Dwelling Units/Parcel Less than 1.5 Acres and 1 or more dwelling units 1.51 to 3.5 Acres and 2 or more dwelling units 3.51 to 7.0 Acres and 4 or more dwelling units 7.01 to 14.0 Acres and 8 or more dwelling units 14.01 to 25 Acres and 15 or more dwelling units 25.01 Acres and larger 26 or more dwelling units Category A is based on the number of existing residential units. Category B: All parcels not defined in Category A or Category C. Category C: All exempt parcels as defined below: 1. All properties currently tax exempt; 2. All public ownership; Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 6 Fiscal Year 2013/14 P466 3. Railroad mainline rights-of-way; 4. Major utility transmission rights-of-way; 5. Mineral rights; 6. Parcels so small they currently cannot be built upon; 7. All normally assessable parcels within an assessed valuation of less than $500 and 1.5 acres or less; and, C. Summary of Preliminary Assessment Amounts Category A: The preliminary estimated assessment rate, which will be levied during fiscal year 2013/2014, is $31.00 per residential dwelling unit for those parcels in Category A. Category A parcels containing more than one residential dwelling unit will be assessed for an amount equal to $31.00 times the number of residential dwelling units. Category B: The assessment, which may be levied for parcels within Category B during fiscal year 2013/2014, shall be according to the following schedule: Definition Assessment Per Parcels Sin le Family Residential $31.00 Multi-Family Residential $31.00 Less than 1.5 Acres $15.50 1.51 Acres to 3.50 Acres $46.50 3.51 Acres to 7.0 Acres $108.50 7.01 Acres to 14.0 Acres $217.00 14.01 Acres to 25.0 Acres $434.00 25.01 Acres and larger $775.00 Category C: The assessment shall be $0.00 for Category C parcels. Annexations There were no annexations effective for the 2013/14 Fiscal Year. Boundary Map An Assessment Diagram for the District is shown on the following page. The lines and dimensions of each lot or parcel within the District are those lines and dimensions shown on the maps of the County Assessor of the County San Bernardino, at the time this report was prepared, and are incorporated by reference herein and made part of this Engineer's Report. Parks and Recreation Improvement District No. PD-85—City of Rancho Cucamonga 7 Fiscal Year 2013/14 P467 bT/STOZ JeaA le:)s!j S eSuowe3n0 04uuea;o Al!J—SS-Od 'ON 1:)lJlsl(l luawanojdwl uoileaJJaa pue seed Q. � 1 £ a .l co W Yr Q C U ¢ iO ny tiieyC) o O m 0 m i r 3 m g2 � Q AV tse3 in ny epuen^!13 AV ePUenn!13 'Q g 19ejo Arq AV Jatsayooal ny ialseyooa AV uaI!ll!W AV ualgl!W AV uaneH ny ueneH AV esowieH AV esowAGH AV ple9!43jV AV ple9!43tV AV uewlleH y AV uewllaH N L L R AV p eAaur 1S ue!laweo t°•-t't °t AV enaE) 2P J L O 00 !' tt{'i �g c m C LL s i 1t P468 STAFF REPORT - ENGINEERING SERVICES DEPARTMENT Date: July 3, 2013 RANCHO CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Mark A. Steuer, Director of Engineering Services Department By: Betty Miller, Associate Engineer Subject: APPROVAL TO ACCEPT A RIDER TO THE IMPROVEMENT SECURITY FOR REMAINING WORK TO BE COMPLETED BY TRACT MAP 18096, LOCATED AT THE SOUTHWEST CORNER OF EAST AVENUE AND VIA VENETO DRIVE, SUBMITTED BY RANCHO VICTORIA MEADOWS, LLC RECOMMENDATION It is recommended that the City Council adopt the attached resolution accepting a Faithful Performance Bond Rider for the remaining work within Tract Map 18096. BACKGROUND/ANALYSIS Tentative Tract 18096, located at the southwest corner of East Avenue and Via Veneto Drive in the Low Medium Residential Development District, was approved by the Planning Commission on December 13, 2006, for the division of 6.92 acres into 32 single family lots. On April 18, 2012, the City Council approved an agreement and securities submitted by Rancho Victoria Meadows, LLC, as Developer, for the installation of street, storm drainage and landscape maintenance district improvements for Tract 18096. The Subdivision Map Act requires developers to furnish performance bonds or other security to ensure public improvements are built to City standards. Subdividers are allowed to request one bond reduction. Government Code 66499.7 states that subdividers may provide substitute bonds or other security to cover 200 percent of the cost of the remaining work, subject to City approval. Developer is now requesting a reduction in the Faithful Performance Bond amount for the remaining improvements in Tract 18096. The Developer provided cost estimates for the remaining work. Staff reviewed the cost estimates and prepared the attached Exhibit A. The new security to guarantee completion of the remaining improvements is in the following amount: Faithful Performance Bond Reduction Rider No. 0578262 $112,800.00 Original Faithful Performance Bond No. 0578262 $417,700.00 The Labor and Material Bond amount in the original agreement and for the Maintenance Bond after improvement acceptance will not change. Res pe bmitted, M r r Director of Engineering Services/City Engineer MAS/BAM:rlf P469 TRACT 18096 'MA' -ER AVER-`-) a� '1T�lIl ` � � - .�'� tins�.. �T• -GA -RC DR. '> ff � I I � I FOQT_HILL_BLVD. C VICINITY MAP 1"=500' ENCOMPASS ASSOCIATES, INC. CONSULTING aV/L ENGINEERS 5699 COUSINS PLACE RANCHO CUCAMONGA CA 91737 (909) 684.00§3 J:\103-206\Grading\Tr18096 Rough Grading.dwg,10/13/20112:09:04 PM,1:1 EXHIBIT "A" P470 ENGINEERING DIVISION ESTIMATE FOR BOND PURPOSES Project NO.:SUBTT'18096 Engineering Reference No.:ROW2013-00379 Quantity Unit Activity Unit Price Amount 816 SF Landscape Irrigation System $2.50 $2,040.00 25,679 SF Landscape Maintenance 180 Day $0.18 $4,622.22 1,489 SF Removal Cold Plane Existing Pavement $0.75 $1,116.75 64 LF Street Berm AC $6.00 $384.00 4,686 SF Street Sidewalk PCC 04" $2.50 $11,715.00 1,064 SF Street Drive Approach Residential $3.00 $3,192.00 16 EA Street Curb Core $150.00 $2,400.00 411 TN Street AC (500 to 900 tons) $45.00 $18,495.00 2 EA Street Curbside Drain STD 107-A $500.00 $1,000.00 3 EA Street Adjust Manhole to Grade $400.00 $1,200.00 10 EA Street Adjust Valves/CO to Grade $150.00 $1,500.00 3 EA Traffic Pavement Markings $5.00 $15.00 365 LS Misc A. Pavement transition signing & striping $1.00 $365.00 1,000 LS Misc B. Replace 1 catch basin cover $1.00 $1,000.00 SUBTOTAL: $49,044.97 CONTINGENCY(15%): $7,356.75 TOTAL ESTIMATE: $56,401.72 FAITHFUL PERFORMANCE BOND (100%): $56,400.00 LABOR AND MATERIAL BOND (100%): $56,400.00 MONUMENTATION (CASH) SURETY: N/A Refer to: Revision Number: Dwg 2307-D R1 &2172-SD R2 City Drawing Number: 2307 and 2307-L Sheet Numbers: 1-5 and L1-L12 'Pursuant to City of Rancho Cucamonga Municipal Code Title 12, Chapter 03, Section .130, a cash restoration/delineation deposit shall be made prior to issuance of an Engineering Construction Permit. 06/06/13 P471 RESOLUTION NO. 13-106 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, APPROVING A RIDER TO THE EXISTING IMPROVEMENT SECURITY FOR TRACT MAP 18096 WHEREAS, Tract Map number 18096, consisting of 32 lots, located at the southwest corner of East Avenue and Via Veneto Drive, was approved by the City of Rancho Cucamonga on April 18, 2012, and all of the requirements established as prerequisite to approval of the final map were met by entry into an Improvement Agreement guaranteed by acceptable Improvement Security by Rancho Victoria Meadows, LLC, as developer; and WHEREAS, said Developer is now submitting for approval a bond reduction rider to their Faithful Performance Bond for the remaining work to be completed. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA HEREBY RESOLVES, that said Rider to the existing Improvement Security submitted by Rancho Victoria Meadows, LLC, be and the same are hereby approved and the City Clerk is hereby authorized to accept the Rider to the Improvement Security. RESOLUTION NO. 13-106 — Page 1 P472 STAFF REPORT E•'NGINEERING SERVICES DEPARTMENT Date: July 3, 2013 RANCHO CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Mark A. Steuer, Director of Engineering Services Department By: Betty Miller, Associate Engineer Subject: ORDERING THE ANNEXATION TO LANDSCAPE MAINTENANCE DISTRICT NO. 3B AND STREET LIGHTING MAINTENANCE DISTRICT NOS. 1 AND 6 FOR DRC2012-00932, LOCATED AT THE SOUTHEAST CORNER OF ARROW ROUTE AND GROVE AVENUE, SUBMITTED BY BECHARA AND BERNADETTE MITRI RECOMMENDATION It is recommended that the City Council adopt the attached resolutions ordering the annexation to Landscape Maintenance District No. 3B and Street Lighting Maintenance District Nos. 1 and 6. BACKGROUND/ANALYSIS DRC2012-00932, a conditional use permit to operate a used car sales office in an existing building located at the southeast corner of Arrow Route and Grove Avenue, and DRC2012-00933, a related request to modify the existing parking lot, were approved by the Planning Commission on December 12, 2012. The applicant, Gabriel Mitri, is preparing revisions to the public improvement plans for the frontage improvements (sidewalk and street trees) which do not require improvement security because the total cost is less than $5,000.00. He will obtain a construction permit at the same time as a building permit for the tenant improvements approved by Building and Safety on June 17, 2013. Consent and Waiver to Annexation forms signed by the property owners are on file in the City Clerk's office. Respectfully submitted, M r Director of Engineering Services/City Engineer MAS/BAM:rlf P473 ' ARROi^i ROUTE I v GURB A v GUTTER 0 SIDEINLK'AG PAY.'. 6`611 0PRW Wo, RU LAHO5 I I I� Mr:LANDS, RU L16HT, M)LIGHT �l+ EXI. AG.PAV EWa.UpRCOAT 3p-6'w l 4T-3' I - I �N LIWT N LARDS Q I M3 LIGHT � f LIMT AUTO 48'-0' 31- REPAIR 40-0' ([)3A765QFT...I BODY SHOP BLDG.•B• YT'6+ BLDG.•A- , i (fa,160050.Fi; 1. —'—'57•0' 2�4'S1. tW'LAIIDS.8b" I. NZ i . N U6HT RU LAWS NIP" '� ^ Am"15l YYXiK ' H'-11 5G i� ? N7WtLW n±E'auD,w ® Illl 15'-9�•. 32'-21 EXISTING:AG PAVING' -- I .NEW 5LLRRY 60A7 k--18' Lu L�J zl w e. O O I. I. RU 416Hi LI6fiT. . 36.10' exsnH6 a� STORA&E.AREA EGWH.LIIIK:FMr; - Ex[ST".Pir.Amhisb KLL.IV NEri I NORTH I I F'=NTS CITY OF ITEM: DRC2012-00932 RANCHO CUCAMONGA TITLE: Annex to LMD 3B, SLD 1 & 6 ENGINEERING SERVICES DEPARTMENT EXHIBIT: Site Plan/Vicinity Map P474 EXHIBIT "A" ENGINEERING DIVISION ESTIMATE FOR BOND PURPOSES Project No.:DRC2012-00932 Engineering Reference No.:ROW2013-00360 Quantity Unit Activity Unit Price Amount 8 EA Landscape Tree 15 Gallon $100.00 $800.00 836 SF Street Sidewalk PCC 04" $2.50 $2,090.00 5 TN Street AC (under 500 tons) $60.00 $300.00 SUBTOTAL: $3,190.00 . CONTINGENCY(15%): $478.50 TOTAL ESTIMATE: $3,668.50 FAITHFUL PERFORMANCE BOND (100%): $3,700.00 LABOR AND MATERIAL BOND (100%): $3,700.00 MONUMENTATION (CASH)SURETY: N/A Refer to: 'Pursuant to City of Rancho Cucamonga Municipal Code Title 12, Chapter 03, Section .130, a cash restoration/delineation deposit shall be made prior to issuance of an Engineering Construction Permit. 05/29/13 P475 RESOLUTION NO. 13-107 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO LANDSCAPE MAINTENANCE DISTRICT NO. 3B (COMMERCIAL INDUSTRIAL MAINTENANCE DISTRICT) FOR DRC2012-00932 WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed a special maintenance district pursuant to the terms of the "Landscape and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (the "Act", said special maintenance district known and designated as Landscape Maintenance District No. 3B (Commercial Industrial Maintenance District) (the "District"); and WHEREAS, the provisions of Article 2 of Chapter 2 of the Act authorize the annexation of additional territory to the District; and WHEREAS, such provisions also provide that the requirement for the preparation of resolutions, and assessment engineer's report, notices of public hearing and the right of majority protest may be waived in writing with the written consent of all of the owners of property within the territory to be annexed; and WHEREAS, notwithstanding that such provisions of the Act related to the annexation of territory to the District, Article XIII D of the Constitution of the State of California ("Article XIII D") establishes certain procedural requirements for the authorization to levy assessments which apply to the levy of annual assessments for the District on the territory proposed to be annexed to such District; and WHEREAS, the owners of certain property described in Exhibit A attached hereto, and incorporated herein by this reference, have requested that such property (collectively, the "Territory") be annexed to the District in order to provide for the levy of annual assessments to finance the maintenance of certain improvements described in Exhibit B hereto (the "Improvements"); and WHEREAS, all of the owners of the Territory have filed with the City Clerk duly executed forms entitled "Consent And Waiver To Annexation Of Certain Real Property To A Maintenance District And Approval Of The Levy Of Assessments On Such Real Property' (the "Consent and Waiver"); and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have expressly waived any and all of the procedural requirements as prescribed in the Act to the annexation of the Territory to the District and have expressly consented to the annexation of the Territory to the District; and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly waived any and all of the procedural requirements as prescribed in the Act and/or Article XIII D applicable to the authorization to levy the proposed annual assessment against the Territory set forth in Exhibit B attached hereto and incorporated herein by this reference and have declared support for, consent to and approval of the authorization to levy such proposed annual assessment set forth in Exhibit C attached hereto; and RESOLUTION NO. 13-107 — Page 1 P476 WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly agreed for themselves, their heirs, successors and assigns that: (1) The proportionate special benefit derived by each parcel in the Territory from the District Improvements has been determined in relationship to the entirety of the maintenance and operation expenses of the Improvements; (2) The proposed annual assessment does not exceed the reasonable cost of the proportional special benefit from the Improvements conferred on each parcel in the Territory. (3) Only the special benefits derived or to be derived by each parcel in the Territory from the Improvements have been included in the proposed annual assessment. WHEREAS, at this time the City Council desires to order the annexation of the Territory to the District and to authorize the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C hereto. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA HEREBY RESOLVES AS FOLLOWS: SECTION 1: That the above recitals are true and correct. SECTION 2: The City Council hereby finds and determines that: a. The annual assessments proposed to be levied on each parcel in the Territory do not exceed the reasonable cost of the proportional special benefit conferred on each such parcel from the Improvements. b. The proportional special benefit derived by each parcel in the Territory from the Improvements has been determined in relationship to the entirety of the cost of the maintenance of the Improvement. c. Only special benefits will be assessed on the Territory by the levy of the proposed annual assessments. SECTION 3: This legislative body hereby orders the annexation the Territory to the District, approves the financing of the maintenance of the Improvements from the proceeds of annual assessments to be levied against the Territory and approves and orders the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C. SECTION 4: All future proceedings of the District, including the levy of all assessments, shall be applicable to the Territory. RESOLUTION NO. 13-107 — Page 2 P477 Exhibit A Identification of the Owner and Description of the Property to be Annexed The Owner of the Property is: Bechara Mitri and Bernadette Mitri, husband and wife as joint tenants The legal description of the Property is: The North 230.00 feet of the West 322.57 feet of the North half of the West half of the West half of Lot 20, in Section 9, Township 1 South, Range 7 West, San Bernardino Base and Meridian, as shown on the map of Cucamonga Lands, in the City of Rancho Cucamonga, County of San Bernardino, State of California, as per map recorded in Book 4, page 9 of Maps, in the office of the County Recorder of said County. EXCEPTING therefrom the East 132.00 feet thereof. Assessor's Parcels Numbers of the Property: 0207-222-05 RESOLUTION NO. 13-107 — Page 3 P478 Exhibit B Description of the District Improvements Fiscal Year 2012/2013 Landscape Maintenance District No. 3B (Commercial Industrial Maintenance District): Landscape Maintenance District No. 3B (Commercial Industrial Maintenance District) (the "Maintenance District") , represents landscape sites throughout the Commercial/Industrial Maintenance District. The various landscape sites that are maintained by this district consist of median islands, parkways, street trees and entry monuments. Proposed additions to the Improvements for Project DRC2012-00932: 8 street trees RESOLUTION NO. 13-107 — Page 4 P479 Exhibit C Proposed Annual Assessment Fiscal Year 2012/2013 Landscape Maintenance District No. 3B (Commercial Industrial Maintenance District): The following table summarizes the assessment rate for Landscape Maintenance District No. 36 (Commercial Industrial Maintenance District) for DRC2012-00932: EDU Rate per Land Use Basis Factor* EDU* Single Family Unit 1.00 $352.80 Multi- Family Unit 1.00 352.80 Commercial/ Industrial Acre 1.00 352.80 Vacant Acre 0.25 352.80 *EDU means Equivalent Dwelling Unit. The proposed annual assessment for the property described in Exhibit A is as follows: 0.85 Acres x 1.00 EDU Factor x $352.80 Rate Per EDU = $299.88 Annual Assessment RESOLUTION NO. 13-107 — Page 5 P480 RESOLUTION NO. 13-108 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 1 (ARTERIAL STREETS) FOR DRC2012-00932 WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed a special maintenance district pursuant to the terms of the "Landscape and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (the "Act", said special maintenance district known and designated as Street Light Maintenance District No. 1 (Arterial Streets) (the "District"); and WHEREAS, the provisions of Article 2 of Chapter 2 of the Act authorize the annexation of additional territory to the District; and WHEREAS, such provisions also provide that the requirement for the preparation of resolutions, and assessment engineer's report, notices of public hearing and the right of majority protest may be waived in writing with the written consent of all of the owners of property within the territory to be annexed; and WHEREAS, notwithstanding that such provisions of the Act related to the annexation of territory to the District, Article XIII D of the Constitution of the State of California ("Article XIII D") establishes certain procedural requirements for the authorization to levy assessments which apply to the levy of annual assessments for the District on the territory proposed to be annexed to such District; and WHEREAS, the owners of certain property described in Exhibit A attached hereto, and incorporated herein by this reference, have requested that such property (collectively, the "Territory') be annexed to the District in order to provide for the levy of annual assessments to finance the maintenance of certain improvements described in Exhibit B hereto (the "Improvements"); and WHEREAS, all of the owners of the Territory have filed with the City Clerk duly executed forms entitled "Consent And Waiver To Annexation Of Certain Real Property To A Maintenance District And Approval Of The Levy Of Assessments On Such Real Property' (the "Consent and Waiver'); and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have expressly waived any and all of the procedural requirements as prescribed in the Act to the annexation of the Territory to the District and have expressly consented to the annexation of the Territory to the District; and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly waived any and all of the procedural requirements as prescribed in the Act and/or Article XIII D applicable to the authorization to levy the proposed annual assessment against the Territory set forth in Exhibit B attached hereto and incorporated herein by this reference and have declared support for, consent to and approval of the authorization to levy such proposed annual assessment set forth in Exhibit C attached hereto; and RESOLUTION NO. 13-108 — Page 1 P481 WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly agreed for themselves, their heirs, successors and assigns that: (1) The proportionate special benefit derived by each parcel in the Territory from the District Improvements has been determined in relationship to the entirety of the maintenance and operation expenses of the Improvements; (2) The proposed annual assessment does not exceed the reasonable cost of the proportional special benefit from the Improvements conferred on each parcel in the Territory. (3) Only the special benefits derived or to be derived by each parcel in the Territory from the Improvements have been included in the proposed annual assessment. WHEREAS, at this time the City Council desires to order the annexation of the Territory to the District and to authorize the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C hereto. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA HEREBY RESOLVES AS FOLLOWS: SECTION 1: That the above recitals are true and correct. SECTION 2: The City Council hereby finds and determines that: a. The annual assessments proposed to be levied on each parcel in the Territory do not exceed the reasonable cost of the proportional special benefit conferred on each such parcel from the Improvements. b. The proportional special benefit derived by each parcel in the Territory from the Improvements has been determined in relationship to the entirety of the cost of the maintenance of the Improvement. c. Only special benefits will be assessed on the Territory by the levy of the proposed annual assessments. SECTION 3: This legislative body hereby orders the annexation the Territory to the District, approves the financing of the maintenance of the Improvements from the proceeds of annual assessments to be levied against the Territory and approves and orders the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C. SECTION 4: All future proceedings of the District, including the levy of all assessments, shall be applicable to the Territory. RESOLUTION NO. 13-108 — Page 2 P482 Exhibit A Identification of the Owner and Description of the Property to be Annexed The Owner of the Property is: Bechara Mitri and Bernadette Mitri, husband and wife as joint tenants The legal description of the Property is: The North 230.00 feet of the West 322.57 feet of the North half of the West half of the West half of Lot 20, in Section 9, Township 1 South, Range 7 West, San Bernardino Base and Meridian, as shown on the map of Cucamonga Lands, in the City of Rancho Cucamonga, County of San Bernardino, State of California, as per map recorded in Book 4, page 9 of Maps, in the office of the County Recorder of said County. EXCEPTING therefrom the East 132.00 feet thereof. Assessor's Parcels Numbers of the Property: 0207-222-05 RESOLUTION NO. 13-108— Page 3 P483 Exhibit B Description of the District Improvements Fiscal Year 2012/2013 Street Light Maintenance District No. 1 (Arterial Streets): Street Light Maintenance District No. 1 (Arterial Streets) (the "Maintenance District') is used to fund the maintenance and/or installation of street lights and traffic signals located on arterial streets throughout the City. These sites consist of several non-contiguous areas throughout the City. The sites maintained by the district consist of street lights on arterial streets and traffic signals on arterial streets within the rights-of-way or designated easements of streets dedicated to the City. Proposed additions to the Improvements for Project DRC2012-00932: None RESOLUTION NO. 13-108 — Page 4 P484 Exhibit C Proposed Annual Assessment Fiscal Year 2012/2013 Street Light Maintenance District No.1 (Arterial Streets): The following table summarizes the assessment rate for Street Light Maintenance District No.1 (Arterial Streets) for DRC2012-00932: EDU Rate per Land Use Basis Factor* EDU* Single Family Parcel 1.00 $17.77 Multi-Family Parcel 1.00 17.77 Commercial Acre 2.00 17.77 Vacant Acre 2.00 17.77 *EDU means Equivalent Dwelling Unit. The proposed annual assessment for the property described in Exhibit A is as follows: 0.85 Acres x 2.00 EDU Factor x $17.77 Rate Per EDU = $30.21 Annual Assessment RESOLUTION NO. 13-108— Page 5 P485 RESOLUTION NO. 13-109 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA, CALIFORNIA, ORDERING THE ANNEXATION OF CERTAIN TERRITORY TO STREET LIGHT MAINTENANCE DISTRICT NO. 6 (COMMERCIAL/INDUSTRIAL) FOR DRC2012-00932 WHEREAS, the City Council of the City of Rancho Cucamonga, California, has previously formed a special maintenance district pursuant to the terms of the "Landscape and Lighting Act of 1972", being Division 15, Part 2 of the Streets and Highways Code of the State of California (the "Act", said special maintenance district known and designated as Street Light Maintenance District No. 6 (Commercial/Industrial)(the "District"); and WHEREAS, the provisions of Article 2 of Chapter 2 of the Act authorize the annexation of additional territory to the District; and WHEREAS, such provisions also provide that the requirement for the preparation of resolutions, and assessment engineer's report, notices of public hearing and the right of majority protest may be waived in writing with the written consent of all of the owners of property within the territory to be annexed; and WHEREAS, notwithstanding that such provisions of the Act related to the annexation of territory to the District, Article XIII D of the Constitution of the State of California ("Article XIII D") establishes certain procedural requirements for the authorization to levy assessments which apply to the levy of annual assessments for the District on the territory proposed to be annexed to such District; and WHEREAS, the owners of certain property described in Exhibit A attached hereto, and incorporated herein by this reference, have requested that such property (collectively, the "Territory") be annexed to the District in order to provide for the levy of annual assessments to finance the maintenance of certain improvements described in Exhibit B hereto (the "Improvements"); and WHEREAS, all of the owners of the Territory have filed with the City Clerk duly executed forms entitled "Consent And Waiver To Annexation Of Certain Real Property To A Maintenance District And Approval Of The Levy Of Assessments On Such Real Property' (the "Consent and Waiver"); and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have expressly waived any and all of the procedural requirements as prescribed in the Act to the annexation of the Territory to the District and have expressly consented to the annexation of the Territory to the District; and WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly waived any and all of the procedural requirements as prescribed in the Act and/or Article XIII D applicable to the authorization to levy the proposed annual assessment against the Territory set forth in Exhibit B attached hereto and incorporated herein by this reference and have declared support for, consent to and approval of the authorization to levy such proposed annual assessment set forth in Exhibit C attached hereto; and RESOLUTION NO. 13-109 — Page 1 P486 WHEREAS, by such Consent and Waiver, all of the owners of the Territory have also expressly agreed for themselves, their heirs, successors and assigns that: (1) The proportionate special benefit derived by each parcel in the Territory from the District Improvements has been determined in relationship to the entirety of the maintenance and operation expenses of the Improvements; (2) The proposed annual assessment does not exceed the reasonable cost of the proportional special benefit from the Improvements conferred on each parcel in the Territory. (3) Only the special benefits derived or to be derived by each parcel in the Territory from the Improvements have been included in the proposed annual assessment. WHEREAS, at this time the City Council desires to order the annexation of the Territory to the District and to authorize the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C hereto. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF RANCHO CUCAMONGA HEREBY RESOLVES AS FOLLOWS: SECTION 1: That the above recitals are true and correct. SECTION 2: The City Council hereby finds and determines that: a. The annual assessments proposed to be levied on each parcel in the Territory do not exceed the reasonable cost of the proportional special benefit conferred on each such parcel from the Improvements. b. The proportional special benefit derived by each parcel in the Territory from the Improvements has been determined in relationship to the entirety of the cost of the maintenance of the Improvement. c. Only special benefits will be assessed on the Territory by the levy of the proposed annual assessments. SECTION 3: This legislative body hereby orders the annexation the Territory to the District, approves the financing of the maintenance of the Improvements from the proceeds of annual assessments to be levied against the Territory and approves and orders the levy of annual assessments against the Territory in amounts not to exceed the amounts set forth in Exhibit C. SECTION 4: All future proceedings of the District, including the levy of all assessments, shall be applicable to the Territory. RESOLUTION NO. 13-109 — Page 2 P487 Exhibit A Identification of the Owner and Description of the Property to be Annexed The Owner of the Property is: Bechara Mitri and Bernadette Mitri, husband and wife as joint tenants The legal description of the Property is: The North 230.00 feet of the West 322.57 feet of the North half of the West half of the West half of Lot 20, in Section 9, Township 1 South, Range 7 West, San Bernardino Base and Meridian, as shown on the map of Cucamonga Lands, in the City of Rancho Cucamonga, County of San Bernardino, State of California, as per map recorded in Book 4, page 9 of Maps, in the office of the County Recorder of said County. EXCEPTING therefrom the East 132.00 feet thereof. Assessor's Parcels Numbers of the Property: 0207-222-05 RESOLUTION NO. 13-109— Page 3 P488 Exhibit B Description of the District Improvements Fiscal Year 2012/2013 Street Light Maintenance District No. 6 (Commercial/Industrial): Street Light Maintenance District No. 6 (the "Maintenance District') is used to fund the maintenance and/or installation of street lights and traffic signals located on commercial and industrial streets throughout the City but excluding those areas already in a local maintenance district. Generally, this area encompasses the industrial area of the City south of Foothill Boulevard The sites maintained by the district consist of street lights on industrial or commercial streets and traffic signals (or a portion thereof) on industrial or commercial streets generally south of Foothill Boulevard. Proposed additions to the Improvements for Project DRC2012-00932: None RESOLUTION NO. 13-109 — Page 4 P489 Exhibit C Proposed Annual Assessment Fiscal Year 2012/2013 Street Light Maintenance District No. 6 (Commercial/Industrial): The following table summarizes the assessment rate for Street Light Maintenance District No. 6 (Commercial/Industrial) DRC2012-00932: EDU Rate per Land Use Basis Factor* EDU* Single Family Unit 1.00 $51.40 Multi-Family Unit 1.00 51.40 Commercial/ Industrial Acre 1.00 51.40 Vacant Acre 2.00 51.40 *EDU means Equivalent Dwelling Unit. The proposed annual assessment for the property described in Exhibit A is as follows: 0.85 Acres x 1.00 EDU Factor x $51.40 Rate Per EDU = $43.69 Annual Assessment RESOLUTION NO. 13-109— Page 5 P490 STAFF REPORT ANimAL CARE AND SERVICES RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council John Gillison, City Manager From: Veronica Fincher, Animal Services Director Subject: Approval to receive and file Animal Center statistics and outcome reports for May 2013 RECOMMENDATION Staff recommends the City Council receive and file the Animal Center statistics and outcome reports for May 2013. BACKGROUNDIANALYSIS The Animal Center tracks monthly statistics as a means of monitoring our Center's operations. Once approved, they will be placed on our City's website. In the month of May 2013, the Animal Center impounded and cared for 561 dogs and cats and 70 small mammals and birds. Of the dogs and cats, 146 were adopted, 89 were placed with rescue or adoption partners, 46 were reunited with their owners, 11 cats were spayed or neutered and returned to caregivers in our trap neuter and return (TNR) program and 87 kittens and puppies were placed into volunteer foster homes to be given additional care prior to adoption. The average euthanasia rate for May was 13.9%. Highlights for the month of May included our annual Outback Steakhouse fundraiser that raised $1,500 for our community programs and a free microchip clinic held at the Animal Center in which 181 dogs and cats were microchipped and 92 dog licenses were sold. Staff and volunteers also attended adoption events at the Upland Animal Shelter Pet Adoption Event, Summer in the City event and the Cucamonga Challenge and Wellness Fair. Additionally, May was the start of our annual summer Bark in the Park fundraiser, where Quakes fans can purchase a pet pass to take their dog to the Quakes baseball game on specified days (upcoming dates are July 24 and August 14). Res submitted, 14) 7 Veronica Fincher Animal Services Director Attachments: Animal Center Statistics and outcome reports for May 2013. P491 City of Rancho Cucamonga Animal Care and Adoption Center Month of ay 2013 Field,OMcer Calls Assist Police,Fire,Other Officer I l Deceased Animal Pick Up SO Investipte Bark 40 vcxo C MONGA In-cstipte Neglect l2 bmstitam Other(Inv,Bite,Inv.Abend,lay.Tethering Muni Violation) 43 S d to Milressive and free morning animals 119 Wild Animals 32 eF Other cash law vitiations,patrol.guazannncs,rescue,admin 375 Total Field Calls 712 IDogAdmal ieeaxs Sold Licenses I An1malGenter LLsd G VA T TotalAdmats A.I Shelter count®of May 1,2013 121 35 156 Intake Live Animal B. From Public(stray or abandoned) 164 237 401 C From Owner/Guardian 23 17 40 D. Adoption Returns 8 5 13 E. Returned from Foster Care 12 66 78 F. Other om at Center,Transferred to Center from other Shelter 7 12 19 G. Owner Requested Euthanasia 9 1 10 PO X 0 2 338 56 Outcome I Adoptions 98 48 146 L TNR or Relocate(Feral Cab,Barn Cats 0 11 11 K. Ttude.0 AVimal3Eehe6eiWieti,m)erdmk(Ye w ema.e m ewe) 1 4 5 L. Sent to Foster Home 9 78 87 M Rescue Partner 29 60 89 N. Reunited with Owner 38 8 46 :01OW a R'OJIXe 175 209 384 P Euthanlzed Q. Euthenized edical,Behavior,Other l2 56 68 R. 10wou Requested Euthanasia 9 1 1 10 S. Total athanasin 21 57 T. Died,Escaped,or Miss!21 3 6 9 U. Invemmy Error licate ID Numbers) 0 0 0 V. Euthanasia Rate-SIH 9.4% 16.9% 13.0% W. Ending Shelter Count as ofMay 31.2013 145 101 246 •Additionally,the Animal Center impounded 70 birds and other small mammals of which 40 were adopted,rescued or released back into the wild. P492 City of Rancho Cucamonga Outcome Totals From 5/1/2013 To 5/31/2013 CAT INTAKE TYPE ID KENNEL BREED YRS/MO SEX OUTCOME TYPE ADOPTION STRAY A664829 CC09 DOMESTIC SH 4 / 2 S ADOPTION RETURN A637091 PETSMART-S DOMESTIC LH 3 / 2 S ADOPTION STRAY A664825 CINT7 DOMESTIC SH 3 / 2 N ADOPTION OWNER SUR A664132 PETSMARTS DOMESTIC SH 11 / 3 S ADOPTION STRAY A664231 PETSMARTS DOMESTIC MH 6 / 3 S ADOPTION FOSTER A664391 CC05 DOMESTIC SH 0 / 4 S ADOPTION FOSTER A664392 CC05 DOMESTIC SH 0 / 4 N ADOPTION FOSTER A664746 CC36 DOMESTIC SH 0 / 4 N ADOPTION FOSTER A664744 CC36 DOMESTIC MH 0 / 4 S ADOPTION FOSTER A664745 CC36 DOMESTIC SH 0 / 4 S ADOPTION FOSTER A664743 CC36 DOMESTIC LH 0 / 4 N ADOPTION STRAY A654999 PETSMART-G DOMESTIC SH 3 / 2 S ADOPTION RETURN A665255 PETSMART-G DOMESTIC SH 3 / 3 N ADOPTION FOSTER A662860 CC08 DOMESTIC SH/ MIX 0 / 4 N ADOPTION FOSTER A662862 CC08 DOMESTIC SH/ MIX 0 / 4 S ADOPTION FOSTER A662863 CC08 DOMESTIC SH/ MIX 0 / 4 N ADOPTION FOSTER A663854 CC09 DOMESTIC SH 0 / 3 N ADOPTION FOSTER A663855 CC09 DOMESTIC SH 0 / 3 S ADOPTION STRAY A654733 PETSMARTS DOMESTIC SH 3 / 2 S ADOPTION FOSTER A662861 CC08 DOMESTIC SH/ MIX 0 / 4 N ADOPTION FOSTER A663851 CC09 DOMESTIC SH 0 / 3 S ADOPTION FOSTER A664482 CC13 DOMESTIC LH 0 / 3 S ADOPTION STRAY A664251 PETSMART-G DOMESTIC SH 1 / 8 S ADOPTION OWNER SUR A664294 PETSMART-G DOMESTIC SH 6 / 3 N ADOPTION STRAY A664991 PETSMART-G SIAMESE 10 / 2 N ADOPTION STRAY A664281 PETSMART-S DOMESTIC SH 4 / 2 N ADOPTION RETURN A665253 CC05 DOMESTIC SH 3 / 1 S ADOPTION OWNER SUR A665746 CC29 MAINE COON/ MIX 2 / 1 N ADOPTION FOSTER A663500 CC04 DOMESTIC SH 0 / 3 N ADOPTION FOSTER A663504 CC04 DOMESTIC SH 0 / 3 N ADOPTION FOSTER A663576 CC04 DOMESTIC MH 0 / 3 S ADOPTION STRAY A665470 PETSMART-S DOMESTIC SH 6 / 2 S ADOPTION STRAY A665515 PETSMART-S SIAMESE 6 / 2 S ADOPTION STRAY A663441 CC07 DOMESTIC SH 6 / 4 S ADOPTION FOSTER A663888 CC05 DOMESTIC SH 0 / 3 S ADOPTION ABANDONED A665360 PETSMARTS HIMALAYAN 3 / 2 N ADOPTION FOSTER A664338 CC05 DOMESTIC SH 0 / 3 N ADOPTION STRAY A665817 CC17 DOMESTIC MH 2 / 1 S ADOPTION STRAY A665557 CC13 DOMESTIC SH 1 / 1 S ADOPTION OWNER SUR A664295 KLUBHOUSE MAINE COON/ MIX 6 / 3 N ADOPTION FOSTER A664934 CC18 DOMESTIC LH 0 / 3 S ADOPTION FOSTER A664935 CC18 DOMESTIC SH 0 / 3 N ADOPTION FOSTER A663850 CC34 DOMESTIC SH 0 / 3 S ADOPTION RETURN A656256 CC18 DOMESTIC SH 1 / 1 N ADOPTION FOSTER A663787 CC15 DOMESTIC SH 0 / 4 N ADOPTION FOSTER A664937 CABANAI DOMESTIC SH 0 / 3 S ADOPTION STRAY A665545 KITTYREEF DOMESTIC SH 1 / 7 S ADOPTION STRAY A666011 FRONT DOMESTIC SH/ DOMESTIC 0 / 3 N ADOPTION CLINIC CLINIC A666337 RECEIVING DOMESTIC SH 3 / 1 N CLINIC CLINIC A666338 RECEIVING DOMESTIC SH 2 / 1 N CLINIC CLINIC A666339 RECEIVING DOMESTIC SH 3 / 1 S CLINIC CLINIC A666340 RECEIVING DOMESTIC SH 3 / 1 S CLINIC 1 P493 City of Rancho Cucamonga Outcome Totals From 5/1/2013 To 5/3112013 DIED FOSTER A666045 RECEIVING DOMESTIC SH 0 / 2 F DIED FOSTER A665991 RECEIVING DOMESTIC SH 0 / 3 M DIED FOSTER A665204 RECEIVING DOMESTIC LH 0 / 2 F DIED FOSTER A664900 RECEIVING DOMESTIC SH 0 / 2 M DIED EUTH EUTH REO A665170 RECEIVING DOMESTIC SH 18 / 2 S EUTH STRAY A665173 RECEIVING DOMESTIC SH / U EUTH STRAY A665174 RECEIVING DOMESTIC SH / U EUTH STRAY A665172 RECEIVING DOMESTIC SH / U EUTH STRAY A664931 CINT8 DOMESTIC LH / F EUTH STRAY A664399 CICU14 DOMESTIC LH / U EUTH STRAY A665427 RECEIVING DOMESTIC SH 2 / 2 F EUTH STRAY A665440 RECEIVING DOMESTIC SH / F EUTH STRAY A665150 TECH1 DOMESTIC SH 2 / 2 N EUTH STRAY A665410 GROOM3 DOMESTIC SH 0 / 3 F EUTH FOSTER A664906 NURSERY6 DOMESTIC MH 0 / 3 F EUTH STRAY A665395 RECEIVING DOMESTIC SH / U EUTH STRAY A665396 RECEIVING DOMESTIC SH / U EUTH STRAY A665397 RECEIVING DOMESTIC SH / U EUTH STRAY A665469 TECH3 DOMESTIC SH 2 / 2 F EUTH STRAY A665604 CINT28 DOMESTIC SH / U EUTH STRAY A666001 RECEIVING DOMESTIC SH / M EUTH STRAY A666003 RECEIVING DOMESTIC SH 0 / 1 U EUTH STRAY A666004 RECEIVING DOMESTIC SH 0 / 1 U EUTH STRAY A665794 RECEIVING DOMESTIC SH 2 / 1 F EUTH STRAY A665713 CICU7 DOMESTIC LH 0 / 3 M EUTH STRAY A665884 RECEIVING DOMESTIC LH 0 / 7 F EUTH STRAY A665888 RECEIVING DOMESTIC SH 0 / 3 M EUTH STRAY A665712 CICU7 DOMESTIC SH 0 / 3 F EUTH STRAY A665593 RECEIVING DOMESTIC SH / F EUTH STRAY A666111 RECEIVING DOMESTIC SH 0 / 2 M EUTH STRAY A665606 CINT20 DOMESTIC SH / U EUTH STRAY A666139 RECEIVING DOMESTIC SH / U EUTH STRAY A666140 RECEIVING DOMESTIC SH / U EUTH STRAY A666141 RECEIVING DOMESTIC SH / U EUTH STRAY A666142 RECEIVING DOMESTIC SH / U EUTH STRAY A666151 RECEIVING DOMESTIC SH / U EUTH STRAY A666154 RECEIVING DOMESTIC SH / U EUTH STRAY A666155 RECEIVING DOMESTIC SH / U EUTH STRAY A666156 RECEIVING DOMESTIC SH / U EUTH STRAY A666158 RECEIVING DOMESTIC SH / U EUTH STRAY A666159 RECEIVING DOMESTIC SH / U EUTH STRAY A666160 RECEIVING DOMESTIC SH / U EUTH STRAY A666165 RECEIVING DOMESTIC SH / U EUTH STRAY A666166 RECEIVING DOMESTIC SH / U EUTH STRAY A666167 RECEIVING DOMESTIC SH / U EUTH STRAY A666168 RECEIVING DOMESTIC SH / U EUTH TNR A665968 CINT1 DOMESTIC SH 1 / 7 S EUTH STRAY A666012 CINT7 DOMESTIC SH 12 / 1 M EUTH STRAY A666197 RECEIVING DOMESTIC SH / U EUTH FOSTER A665992 RECEIVING DOMESTIC SH 0 / 3 M EUTH FOSTER A665993 RECEIVING DOMESTIC SH 0 / 3 F EUTH FOSTER A665414 NURSERY6 DOMESTIC SH 0 / 3 M EUTH FOSTER A665420 NURSERYI DOMESTIC SH 0 / 3 F EUTH STRAY A665598 CICU11 DOMESTIC MH 4 / 1 S EUTH STRAY A666386 RECEIVING DOMESTIC SH 7 / 1 M EUTH 2 P494 City of Rancho Cucamonga Outcome Totals From 511/2013 To 5/31/2013 STRAY A666392 RECEIVING DOMESTIC SH 0 / 5 F EUTH STRAY A666328 RECEIVING DOMESTIC SH / F EUTH STRAY A666341 RECEIVING DOMESTIC SH / U EUTH STRAY A666344 RECEIVING DOMESTIC LH / U EUTH ABANDONED A666372 RECEIVING DOMESTIC SH / U EUTH ABANDONED A666373 RECEIVING DOMESTIC SH / U EUTH FOSTER STRAY A666335 RECEIVING DOMESTIC LH 0 / 2 M FOSTER STRAY A666336 RECEIVING DOMESTIC SH 0 / 2 M FOSTER STRAY A666289 NURSERY4 DOMESTIC SH 0 / 2 F FOSTER STRAY A666292 NURSERY4 DOMESTIC SH 0 / 2 M FOSTER STRAY A666329 FOSTER DOMESTIC MH 0 / 2 M FOSTER STRAY A666330 FOSTER DOMESTIC MH 0 / 2 F FOSTER STRAY A666331 FOSTER DOMESTIC MH 0 / 2 F FOSTER STRAY A666332 FOSTER DOMESTIC MH 0 / 2 F FOSTER STRAY A666333 FOSTER DOMESTIC MH 0 / 2 M FOSTER STRAY A666334 FOSTER DOMESTIC MH 0 / 2 M FOSTER FOSTER A666109 NURSERY4 DOMESTIC SH 0 / 3 M FOSTER FOSTER A666110 NURSERY4 DOMESTIC SH 0 / 3 F FOSTER STRAY A666260 RECEIVING DOMESTIC SH 0 / 2 F FOSTER STRAY A666215 NURSERY3 DOMESTIC MH 0 / 2 M FOSTER STRAY A666216 NURSERY3 DOMESTIC MH 0 / 2 M FOSTER STRAY A666219 NURSERY6 DOMESTIC LH 0 / 2 F FOSTER STRAY A666241 RECEIVING DOMESTIC SH 0 / 2 M FOSTER STRAY A666242 RECEIVING DOMESTIC SH 0 / 2 F FOSTER STRAY A666243 RECEIVING DOMESTIC SH 0 / 2 F FOSTER STRAY A666244 RECEIVING DOMESTIC SH 0 / 2 M FOSTER STRAY A666245 RECEIVING DOMESTIC SH 0 / 2 F FOSTER OWNER SUR A665415 NURSERYI DOMESTIC SH 0 / 2 S FOSTER OWNER SUR A665416 NURSERY6 DOMESTIC SH 0 / 2 N FOSTER OWNER SUR A665417 NURSERY6 DOMESTIC SH 0 / 2 S FOSTER OWNER SUR A665420 NURSERYI DOMESTIC SH 0 / 3 F FOSTER STRAY A666109 RECEIVING DOMESTIC SH 0 / 3 M FOSTER STRAY A666110 RECEIVING DOMESTIC SH 0 / 3 F FOSTER STRAY A666131 NURSERY2 DOMESTIC SH 0 / 3 S FOSTER STRAY A666133 CINT25 DOMESTIC SH 0 / 2 S FOSTER STRAY A666134 CINT25 DOMESTIC SH 0 / 2 S FOSTER OWNER SUR A665414 NURSERY6 DOMESTIC SH 0 / 3 M FOSTER STRAY A665602 NURSERY6 DOMESTIC MH 0 / 2 S FOSTER STRAY A665501 NURSERY3 DOMESTIC SH 0 / 3 S FOSTER STRAY A665588 RECEIVING DOMESTIC MH 0 / 2 F FOSTER STRAY A665591 RECEIVING DOMESTIC LH 0 / 2 N FOSTER STRAY A665645 RECEIVING DOMESTIC SH 0 / 2 F FOSTER STRAY A665715 RECEIVING DOMESTIC SH 0 / 2 M FOSTER STRAY A665662 RECEIVING DOMESTIC MH 0 / 2 F FOSTER FOSTER A665602 RECEIVING DOMESTIC MH 0 / 2 S FOSTER STRAY A665640 CICU1 DOMESTIC LH 0 / 2 M FOSTER FOSTER A665662 RECEIVING DOMESTIC MH 0 / 2 F FOSTER STRAY A665705 CICU7 DOMESTIC MH 0 / 3 M FOSTER STRAY A665615 NURSERY4 DOMESTIC SH 0 / 3 N FOSTER STRAY A665616 NURSERY4 DOMESTIC SH 0 / 3 S FOSTER STRAY A665650 RECEIVING DOMESTIC SH 0 / 2 S FOSTER STRAY A665727 RECEIVING DOMESTIC LH 0 / 2 F FOSTER STRAY A665714 CICU7 DOMESTIC SH 0 / 3 M FOSTER STRAY A665857 RECEIVING DOMESTIC MH 0 / 2 F FOSTER STRAY A665975 RECEIVING DOMESTIC SH 0 / 3 N FOSTER STRAY A666045 RECEIVING DOMESTIC SH 0 / 2 F FOSTER STRAY A666018 NURSERY2 DOMESTIC SH 0 / 2 N FOSTER 3 P495 City of Rancho Cucamonga Outcome Totals From 511/2013 To 5131/2013 FOSTER A663503 CICU7 DOMESTIC SH 0 / 3 N FOSTER STRAY A665398 RECEIVING DOMESTIC SH / U FOSTER STRAY A665204 RECEIVING DOMESTIC LH 0 / 2 F FOSTER STRAY A665341 NURSERY4 DOMESTIC SH 0 / 3 F FOSTER STRAY A665342 NURSERY4 DOMESTIC SH 0 / 3 F FOSTER STRAY A665343 NURSERY4 DOMESTIC SH 0 / 3 F FOSTER FOSTER A664214 RECEIVING DOMESTIC SH 0 / 3 F FOSTER FOSTER A664215 RECEIVING DOMESTIC SH 0 / 3 F FOSTER STRAY A665422 FOSTER DOMESTIC LH 0 / 3 F FOSTER STRAY A665423 FOSTER DOMESTIC LH 0 / 3 F FOSTER STRAY A665424 FOSTER DOMESTIC LH 0 / 3 M FOSTER STRAY A665425 FOSTER DOMESTIC LH 0 / 3 M FOSTER STRAY A665409 GROOMS DOMESTIC SH 0 / 2 N FOSTER STRAY A665474 NURSERY6 DOMESTIC MH 0 / 2 S FOSTER STRAY A665475 NURSERY6 DOMESTIC MH 0 / 3 F FOSTER STRAY A665476 NURSERY6 DOMESTIC MH 0 / 3 N FOSTER STRAY A665477 NURSERY6 DOMESTIC MH 0 / 3 F FOSTER STRAY A665478 NURSERY6 DOMESTIC MH 0 / 3 N FOSTER FOSTER A664934 RECEIVING DOMESTIC LH 0 / 3 S FOSTER FOSTER A664935 RECEIVING DOMESTIC SH 0 / 3 N FOSTER FOSTER A664936 RECEIVING DOMESTIC SH 0 / 3 S FOSTER FOSTER A664937 RECEIVING DOMESTIC SH 0 / 3 S FOSTER WILD A665204 RECEIVING DOMESTIC LH 0 / 2 F FOSTER STRAY A665322 RECEIVING DOMESTIC SH 0 / 2 N FOSTER STRAY A665323 RECEIVING DOMESTIC SH 0 / 2 S FOSTER STRAY A665324 RECEIVING DOMESTIC SH 0 / 2 N FOSTER STRAY A665325 RECEIVING DOMESTIC SH 0 / 2 S FOSTER HISSING FOSTER A663501 CC04 DOMESTIC SH 0 / 3 S MISSING FOSTER A663502 CCO4 DOMESTIC SH 0 / 3 N MISSING RELOCATE STRAY A665356 CINT1 DOMESTIC MH / N RELOCATE STRAY A664004 CINT28 DOMESTIC SH 2 / 2 N RELOCATE STRAY A664395 CINT5 DOMESTIC SH 1 / 0 S RELOCATE RESCUE FOSTER A665034 NURSERY2 DOMESTIC SH 0 / 3 M RESCUE STRAY A665036 NURSERY7 DOMESTIC SH 1 / 5 F RESCUE STRAY A665038 NURSERY7 DOMESTIC MH 0 / 3 F RESCUE STRAY A665051 TECH2 DOMESTIC SH 0 / 3 M RESCUE STRAY A665052 TECH2 DOMESTIC SH 0 / 3 M RESCUE STRAY A665053 TECH2 DOMESTIC SH 0 / 3 F RESCUE STRAY A665142 RECEIVING DOMESTIC LH 0 / 3 M RESCUE STRAY A665154 NURSERY5 DOMESTIC SH 0 / 2 F RESCUE STRAY A665155 NURSERY5 DOMESTIC SH 0 / 2 M RESCUE STRAY A665157 NURSERY5 DOMESTIC SH 0 / 2 M RESCUE FOSTER A665171 NURSERY2 DOMESTIC LH 0 / 3 M RESCUE ABANDONED A665263 RECEIVING DOMESTIC SH / U RESCUE ABANDONED A665264 RECEIVING DOMESTIC SH / U RESCUE ABANDONED A665265 RECEIVING DOMESTIC SH / U RESCUE ABANDONED A665266 RECEIVING DOMESTIC SH / U RESCUE STRAY A665268 RECEIVING DOMESTIC SH / U RESCUE STRAY A665270 RECEIVING DOMESTIC SH / U RESCUE STRAY A665271 RECEIVING DOMESTIC SH / U RESCUE STRAY A665272 RECEIVING DOMESTIC SH / U RESCUE STRAY A665273 RECEIVING DOMESTIC SH / U RESCUE STRAY A665289 RECEIVING DOMESTIC MH 0 / 3 F RESCUE 4 P496 City of Rancho Cucamonga Outcome Totals From 51112013 To 5131/2013 STRAY A665298 RECEIVING DOMESTIC SH / U RESCUE STRAY A665299 RECEIVING DOMESTIC SH / U RESCUE STRAY A665300 RECEIVING DOMESTIC SH / U RESCUE STRAY A665301 RECEIVING DOMESTIC SH / U RESCUE FOSTER A664214 RECEIVING DOMESTIC SH 0 / 3 F RESCUE FOSTER A664215 RECEIVING DOMESTIC SH 0 / 3 F RESCUE STRAY A665704 RECEIVING DOMESTIC SH 0 / 3 M RESCUE STRAY A665706 RECEIVING DOMESTIC SH 0 / 3 F RESCUE STRAY A665707 RECEIVING DOMESTIC SH 0 / 3 F RESCUE STRAY A665708 RECEIVING DOMESTIC SH 0 / 3 F RESCUE STRAY A665710 RECEIVING DOMESTIC LH 0 / 3 M RESCUE STRAY A665711 RECEIVING DOMESTIC LH 0 / 3 M RESCUE STRAY A665809 NURSERY2 DOMESTIC LH 0 / 3 M RESCUE STRAY A665810 NURSERY2 DOMESTIC LH 0 / 3 F RESCUE STRAY A665828 RECEIVING DOMESTIC SH 0 / 2 F RESCUE STRAY A665991 RECEIVING DOMESTIC SH 0 / 3 M RESCUE STRAY A665992 RECEIVING DOMESTIC SH 0 / 3 M RESCUE STRAY A665993 RECEIVING DOMESTIC SH 0 / 3 F RESCUE STRAY A666065 NURSERYI DOMESTIC MH 0 / 2 M RESCUE STRAY A666066 NURSERYI DOMESTIC SH 0 / 2 F RESCUE STRAY A666191 RECEIVING DOMESTIC SH 0 / 2 F RESCUE STRAY A666193 RECEIVING DOMESTIC SH 0 / 2 M RESCUE STRAY A666194 RECEIVING DOMESTIC SH 0 / 2 F RESCUE STRAY A666195 RECEIVING DOMESTIC SH 0 / 2 F RESCUE STRAY A666196 RECEIVING DOMESTIC SH 0 / 2 M RESCUE STRAY A666180 CINT37 DOMESTIC MH 0 / 3 F RESCUE STRAY A665956 CINT11 SIAMESE/ DOMESTIC MH 2 / 1 F RESCUE STRAY A665957 CINT11 DOMESTIC MH 0 / 3 F RESCUE STRAY A665958 CINT11 DOMESTIC MH 0 / 3 M RESCUE STRAY A665959 CINT11 DOMESTIC MH 0 / 3 M RESCUE STRAY A665960 CINT11 DOMESTIC MH 0 / 3 M RESCUE STRAY A666091 CINT28 DOMESTIC SH 0 / 3 F RESCUE STRAY A666092 CINT28 DOMESTIC SH 0 / 3 F RESCUE STRAY A666093 CINT28 DOMESTIC SH 0 / 3 F RESCUE STRAY A666058 CINT8 DOMESTIC SH 2 / 1 F RESCUE STRAY A666059 CINT8 DOMESTIC SH 0 / 3 F RESCUE STRAY A666060 CINT8 DOMESTIC SH 0 / 3 M RESCUE STRAY A666061 CINT8 DOMESTIC SH 0 / 3 M RESCUE STRAY A666062 CINT8 DOMESTIC SH 0 / 3 M RESCUE RTO STRAY A665804 RECEIVING DOMESTIC MH 2 / 1 N RTO OWNER SUR A665414 RECEIVING DOMESTIC SH 0 / 3 M RTO OWNER SUR A665415 RECEIVING DOMESTIC SH 0 / 2 S RTO OWNER SUR A665416 RECEIVING DOMESTIC SH 0 / 2 N RTO OWNER SUR A665417 RECEIVING DOMESTIC SH 0 / 2 S RTO OWNER SUR A665418 RECEIVING DOMESTIC SH / M RTO OWNER SUR A665419 RECEIVING DOMESTIC SH / M RTO OWNER SUR A665420 RECEIVING DOMESTIC SH 0 / 3 F RTO TNR TNR A665004 CINT32 DOMESTIC SH / S TNR TNR A665043 CINT6 DOMESTIC SH 1 / 2 N TNR STRAY A663832 CC01 DOMESTIC SH 2 ! 2 S TNR TNR A665467 CINT11 DOMESTIC SH / N TNR TNR A666050 CINT33 DOMESTIC SH 9 / 1 S TNR TNR A666203 CINT20 DOMESTIC SH / S TNR TNR A666022 CINT3 DOMESTIC SH / N TNR TNR A665473 CINT9 DOMESTIC MH / S TNR 5 P497 City of Rancho Cucamonga Outcome Totals From 5/1/2013 To 5/31/2013 Total : 272 DOG INTAKE TYPE ID KENNEL BREED YRS/MO SEX OUTCOME TYPE ADOPTION STRAY A665826 SMDOG35 POODLE MIN/ COCKER SP/ 2 / 1 S ADOPTION STRAY A665862 41 LABRADOR RETR 1 / 7 N ADOPTION STRAY A665894 SMDOGI CHIHUAHUA SH/ MIX 0 / 4 S ADOPTION STRAY A665903 SMDOG32 MALTESE/ POODLE MIN 3 / 1 N ADOPTION STRAY A666000 CINT40 POODLE MIN/ MALTESE 2 / 1 S ADOPTION STRAY A665679 SMDOG31 DACHSHUND/ MIX 0 / 5 N ADOPTION OWNER SUR A654752 04 GERM SHEPHERD 1 / 10 N ADOPTION RETURN A659481 SMDOG28 BORDER TERRIER/ MIX 1 / 9 N ADOPTION STRAY A666032 SMDOG20 MANCHESTER TERR 8 / 1 S ADOPTION STRAY A665349 CRATE GERM SHEPHERD 3 / 2 S ADOPTION STRAY A666171 61 AKITA 1 / 1 S ADOPTION STRAY A666104 SMDOG20 POODLE MIN 1 / 9 S ADOPTION STRAY A665896 SMDOGI CHIHUAHUA SH/ MIX 0 / 4 S ADOPTION STRAY A665901 SMDOG3 CHIHUAHUA SH 0 / 11 N ADOPTION STRAY A664554 CINT15 WHIPPET 0 / 5 N ADOPTION STRAY A664863 SMDOG23 CHIHUAHUA SH/ MIX 1 / 1 N ADOPTION STRAY A665895 SMDOG1 CHIHUAHUA SH/ MIX 0 / 4 S ADOPTION STRAY A664566 SMDOGI8 CHIHUAHUA SH/ MIX 8 / 2 S ADOPTION RETURN A663556 54 LHASA APSO/ SHIH TZU 1 / 9 N ADOPTION STRAY A665321 24 LABRADOR RETR 1 / 8 S ADOPTION STRAY A665550 SMDOGI3 LABRADOR RETR/ BOXER 0 / 5 N ADOPTION STRAY A665590 SMDOG15 GERM SHEPHERD/ BOXER 0 / 4 N ADOPTION STRAY A665460 12 MALTESE 2 / 2 N ADOPTION STRAY A664883 46 LABRADOR RETR/ MIX 5 / 2 S ADOPTION STRAY A665158 03 SCHNAUZER MIN 2 / 2 N ADOPTION STRAY A665447 SMDOGI BRUSS GRIFFON/ MIX 0 / 7 S ADOPTION STRAY A664167 SMDOG5 CHIHUAHUA SH 3 / 3 S ADOPTION RETURN A652477 10 SIBERIAN HUSKY/ GERM Si 1 / 9 S ADOPTION STRAY A661761 40 BEAGLE/ MIN PINSCHER 5 / 6 N ADOPTION FOSTER A664192 RECEIVING CHIHUAHUA SH 0 / 3 S ADOPTION FOSTER A664196 RECEIVING CHIHUAHUA SH 0 / 3 N ADOPTION FOSTER A664198 RECEIVING CHIHUAHUA SH 0 / 3 S ADOPTION STRAY A664440 SMDOG8 MALTESE/ POODLE MIN 1 / 1 N ADOPTION STRAY A664884 SMDOGI3 CHIHUAHUA SH/ MIX 4 / 2 S ADOPTION STRAY A664907 SMDOG32 NORFOLK TERRIER/ CHIHU 1 / 0 N ADOPTION STRAY A664954 SMDOG20 POODLE TOY/ MALTESE 2 / 8 S ADOPTION STRAY A664955 SMDOG22 POODLE TOY/ MALTESE 1 ! 8 S ADOPTION STRAY A665048 13 LABRADOR RETR/ MIX 1 / 2 S ADOPTION STRAY A665132 SMDOGI5 POODLE TOY 5 / 2 N ADOPTION STRAY A665195 SMDOG26 ITAL GREYHOUND I MIX 8 / 2 N ADOPTION OWNER SUR A662993 SMDOG17 CHIHUAHUA SH 0 / 10 S ADOPTION FOSTER A663548 SMDOG34 POODLE MIN/ CHIHUAHUA 0 / 4 S ADOPTION FOSTER A663549 SMDOG34 POODLE MIN/ CHIHUAHUA 0 I 4 S ADOPTION STRAY A664089 SMDOG9 CHIHUAHUA SH 10 / 3 S ADOPTION FOSTER A664193 RECEIVING CHIHUAHUASH/ DACHSHU 0 / 3 N ADOPTION RETURN A653976 SMDOGI RAT TERRIER/ CHIHUAHUA 4 / 3 N ADOPTION STRAY A662713 SMDOG3 CHIHUAHUA SH 6 / 5 N ADOPTION STRAY A665530 SMDOG8 POODLE MIN 4 / 1 N ADOPTION 6 P498 City of Rancho Cucamonga Outcome Totals From 51112013 To 5/31/2013 OWNER SUR A663641 43 DACHSHUND/ MIX 1 / 9 S ADOPTION STRAY A665479 SMDOG7 MALTESE/ SCOT TERRIER 2 / 2 N ADOPTION STRAY A665156 SMDOG35 CHIHUAHUA SH 1 / 2 N ADOPTION STRAY A665487 SMDOG14 WHIPPET/ MIX 0 / 7 S ADOPTION STRAY A656905 04 BOXER 7 / 2 N ADOPTION STRAY A665801 SMDOGS CHIHUAHUA SH/ DACHSHU 0 / 4 N ADOPTION STRAY A665676 SMDOG2 DACHSHUND! MIX 0 / 3 N ADOPTION STRAY A665661 SMDOG41 PEKINGESE 2 / 1 N ADOPTION STRAY A665790 SMDOGI POODLE MIN 1 / 7 S ADOPTION STRAY A665812 06 OLD ENG BULLDOG/ BOXEI 1 / 1 S ADOPTION STRAY A664857 06 LABRADOR RETR/ PIT BULI 1 / 8 N ADOPTION STRAY A665532 SMDOG15 BRUSS GRIFFON/ MIX 4 / 1 S ADOPTION STRAY A665595 SMDOG32 MIN PINSCHER/ MIX 0 / 3 S ADOPTION STRAY A665677 SMDOG4 DACHSHUND/ MIX 0 / 3 N ADOPTION STRAY A665678 SMDOG4 DACHSHUND/ MIX 0 / 3 S ADOPTION STRAY A665692 41 ANATOL SHEPHERD/ MIX 0 / 5 N ADOPTION STRAY A665693 41 ANATOL SHEPHERD/ MIX 0 / 5 S ADOPTION STRAY A665045 SMDOG37 CHIHUAHUASH 0 / 5 N ADOPTION STRAY A664768 TECH4 POODLE MIN 1 / 10 N ADOPTION STRAY A665007 SMDOG33 POODLE TOY/ BORDER TO 0 / 4 N ADOPTION STRAY A665008 SMDOG33 POODLE TOY/ BORDER TEI 0 / 4 S ADOPTION STRAY A661305 GARDEN ITAL GREYHOUND/ CHIHUA 1 / 1 N ADOPTION STRAY A665068 CINT44 DACHSHUND 1 / 2 N ADOPTION OWNER SUR A665102 SMDOG39 BEAGLE/ PLOTT HOUND 0 / 4 S ADOPTION STRAY A664313 17 PIT BULL/ MIX 3 / 3 S ADOPTION OWNER SUR A663283 41 QUEENSLAND HEEL/ LABRi 10 / 4 S ADOPTION STRAY A665059 31 COCKER SPAN 2 / 2 N ADOPTION STRAY A664807 SMDOG3 JACK RUSS TERR 0 / 7 S ADOPTION STRAY A664818 02 GERM SHEPHERD/ MIX 1 / 0 S ADOPTION STRAY A664388 29 BOXER/ LABRADOR RETR 1 / 2 N ADOPTION ABANDONED A664454 03 DACHSHUND/ MIX 1 / 2 S ADOPTION RETURN A664456 03 DACHSHUND/ MIX 1 / 2 N ADOPTION STRAY A664786 28 GERM SHEPHERD/ GREYH( 5 / 6 S ADOPTION RETURN A665185 33 AUST CATTLE DOG/ LABRA 6 / 2 S ADOPTION STRAY A665140 29 WELSH CORGI PEM/ BEAGI 1 / 1 S ADOPTION STRAY A664773 SMDOG39 MALTESE 1 / 1 N ADOPTION STRAY A664924 SMDOG23 ITAL GREYHOUND/ CHIHUF 1 / 1 N ADOPTION RETURN A656740 PORT1 BOXER/ MIX 1 / 12 S ADOPTION STRAY A663306 24 AMER BULLDOG/ BOXER 2 / 4 N ADOPTION ABANDONED A664791 12 COCKER SPAN/ POODLE M 3 / 2 N ADOPTION STRAY A665346 20 PIT BULL/ MIX 5 / 2 N ADOPTION STRAY A665348 SMDOG19 GREAT DANE/ BASSET HOI 0 / 4 S ADOPTION FOSTER A664194 RECEIVING CHIHUAHUA SH 0 / 3 N ADOPTION OWNER SUR A664732 SMDOG31 CHIHUAHUA SH 2 / 2 N ADOPTION STRAY A665405 SMDOG34 COCKER SPAN/ MIX 0 / 4 N ADOPTION STRAY A665005 02 BOXER/ MIX 4 / 2 N ADOPTION STRAY A665075 SMDOG14 POODLE TOY/ MIX 1 / 8 N ADOPTION STRAY A665194 TECH1 CAIRN TERRIER/ MIX 0 / 12 S ADOPTION STRAY A664404 SMDOG10 CHIHUAHUA SH 1 / 0 N ADOPTION OWNER SUR A665182 32 PIT BULL 3 / 4 N ADOPTION CLINIC CLINIC A665565 SURGERY SCHNAUZER GIANT 8 / 2 S CLINIC DIED STRAY A665366 60 AMER ESKIMO 2 / 2 N DIED OWNER SUR A665175 RECEIVING GERM SHEPHERD 0 / 6 M DIED STRAY A666172 VET POODLE MIN / M DIED 7 P499 City of Rancho Cucamonga Outcome Totals From 5/112013 To 513112013 EUTH EUTH REQ A329091 RECEIVING DACHSHUND 7 / 10 N EUTH STRAY A662140 51 PIT BULL / F EUTH EUTH REQ A625196 RECEIVING LABRADOR RETR/ MIX 12 / 2 M EUTH STRAY A665892 CINT41 SHIH TZU 10 / 1 S EUTH EUTH REQ A254420 RECEIVING CHIHUAHUA SH/ MIX 18 / 2 S EUTH EUTH REQ A665363 RECEIVING LABRADOR RETR/ MIX 0 / 8 F EUTH EUTH REQ A665338 RECEIVING ROTTWEILER 11 / 2 F EUTH STRAY A665426 RECEIVING DOBERMAN PINSCH / M EUTH OWNER SUR A665250 TECH2 YORKSHIRE TERR 3 / 12 S EUTH STRAY A665463 RECEIVING DACHSHUND/ CHIHUAHUA 0 / 4 M EUTH STRAY A665464 RECEIVING BORDER COLLIE / M EUTH EUTH REQ A665546 RECEIVING COCKER SPAN/ MIX 9 / 2 F EUTH RETURN A647707 61 BOXER 2 / 2 S EUTH STRAY A664400 54 BOXER/ MIX 2 / 2 M EUTH OWNER SUR A665944 NURSERYS CHIHUAHUA SH 0 / 7 M EUTH ABANDONED A665614 VET POODLE MIN 1 / 1 N EUTH STRAY A665617 RECEIVING AM PIT BULL TER 2 / 7 M EUTH EUTH REQ A665584 RECEIVING BOXER ! M EUTH EUTH REQ A665357 59 PIT BULL 6 / 2 S EUTH EUTH REQ A665766 RECEIVING AMER BULLDOG 0 / 4 F EUTH OWNER SUR A631345 49 LABRADOR RETR/ MIX 5 / 3 N EUTH FOSTER STRAY A665802 SMDOG5 CHIHUAHUA SH 0 / 5 S FOSTER OWNER SUR A665868 RECEIVING PIT BULL/ MIX 0 / 3 F FOSTER OWNER SUR A665869 FOSTER PIT BULL/ MIX 0 / 3 N FOSTER OWNER SUR A665870 RECEIVING PIT BULL/ MIX 0 / 3 M FOSTER OWNER SUR A665871 RECEIVING PIT BULL/ MIX 0 / 3 N FOSTER OWNER SUR A665872 FOSTER PIT BULL/ MIX 0 / 3 N FOSTER OWNER SUR A665873 RECEIVING PIT BULL/ MIX 0 / 3 M FOSTER OWNER SUR A665874 FOSTER PIT BULL/ MIX 0 / 3 N FOSTER OWNER SUR A665875 FOSTER PIT BULL/ MIX 0 / 3 M FOSTER RESCUE FOSTER A664318 SMDOG2 BOXER/ AUST CATTLE DO( 0 / 4 N RESCUE FOSTER A665868 RECEIVING PIT BULL/ MIX 0 / 3 F RESCUE FOSTER A665870 RECEIVING PIT BULL/ MIX 0 / 3 M RESCUE FOSTER A665873 RECEIVING PIT BULL/ MIX 0 ! 3 M RESCUE FOSTER A665875 FOSTER PIT BULL/ MIX 0 / 3 M RESCUE STRAY A659513 SMDOG7 CHIHUAHUA SH 3 / 9 N RESCUE STRAY A661885 40 CHIHUAHUA SH 4 / 5 S RESCUE ABANDONED A664790 12 COCKER SPAN/ POODLE M 4 / 2 N RESCUE STRAY A663807 CINT43 CHIHUAHUA SH 2 / 3 N RESCUE ABANDONED A664133 CINT39 CHIHUAHUA SH 2 / 3 N RESCUE STRAY A664545 SMDOG40 CHIHUAHUA SH 2 / 2 S RESCUE STRAY A664546 SMDOG40 CHIHUAHUASH 1 / 10 N RESCUE STRAY A664926 CINT42 CHIHUAHUASH 1 / 1 N RESCUE STRAY A665267 55 BULLMASTIFF 5 / 2 M RESCUE STRAY A665050 SMDOG16 MALTESE 4 / 2 N RESCUE STRAY A664224 SMDOG16 POODLE TOY 3 / 3 N RESCUE STRAY A664902 SMDOG6 YORKSHIRE TERR/ MIX 8 / 2 M RESCUE STRAY A658583 47 LABRADOR RETR/ VIZSLA 2 / 10 S RESCUE STRAY A660789 20 PIT BULL/ MIX 3 / 7 N RESCUE STRAY A662190 04 LABRADOR RETR/ MIX 2 / 10 N RESCUE OWNER SUR A663617 SMDOG22 CAIRN TERRIER/ MIX 1 / 3 S RESCUE RETURN A663620 SMDOG20 DACHSHUND/ CHIHUAHUA 0 / 10 N RESCUE RETURN A659726 SMDOG4 JACK RUSS TERR 4 / 8 S RESCUE OWNER SUR A665636 47 AKITA 10 / 8 S RESCUE 8 P500 City of Rancho Cucamonga Outcome Totals From 5/1/2013 To 5/31/2013 OWNER SUR A665637 47 AKITA 5 / 1 N RESCUE STRAY A665481 32 LABRADOR RETR 5 / 1 N RESCUE OWNER SUR A665867 50 BORDER COLLIE/ SIBERIAN 2 / 1 S RESCUE STRAY A666149 CRATE AUST CATTLE DOG/ BULL l 1 / 1 N RESCUE STRAY A666095 41 WEIMARANER/ WEIMARAN 1 / 0 N RESCUE RTO STRAY A666383 RECEIVING PIT BULL 0 / 10 F RTO STRAY A666279 RECEIVING GERM SHEPHERD/ MIX / S RTO STRAY A660004 55 LABRADOR RETR 1 / 7 N RTO CONFISCATE A666138 PORT6 CHIHUAHUASH 1 / 7 M RTO CONFISCATE A665696 PORT6 PIT BULL 0 / 10 M RTO STRAY A666184 RECEIVING BOSTON TERRIER/ CHIHUP 4 / 1 S RTO STRAY A666204 SMDOG31 YORKSHIRE TERR 10 / 1 S RTO STRAY A666189 RECEIVING CHIHUAHUA SH 12 / 1 S RTO STRAY A666201 VET VIZSLA 2 / 1 M RTO STRAY A665165 PORT3 GREAT DANE/ LABRADOR [ 6 / 8 N RTO STRAY A665166 RECEIVING POODLE TOY 11 / 2 M RTO STRAY A628565 SMDOG37 CHIHUAHUA LH/ MIX 15 / 10 M RTO STRAY A665519 PORTS LABRADOR RETR/ PIT BULI ! M RTO STRAY A665547 RECEIVING CAIRN TERRIER/ MIX 1 / 7 N RTO STRAY A665548 RECEIVING POODLE MIN 4 / 2 S RTO STRAY A665456 RECEIVING BICHON FRISE 0 / 5 F RTO STRAY A665457 RECEIVING DACHSHUND/ MIX 14 / 8 S RTO STRAY A665400 RECEIVING CHIHUAHUA SH 2 / 2 F RTO STRAY A665625 56 GERM SHEPHERD 0 / 11 N RTO STRAY A665652 RECEIVING COCKER SPAN/ POODLE M 1 / 1 F RTO STRAY A665619 55 BORDER COLLIE 7 / 1 M RTO STRAY A665651 RECEIVING POMERANIAN/ MIX 15 / 1 F RTO STRAY A665695 RECEIVING CHIHUAHUA SH 2 / 7 N RTO STRAY A665698 RECEIVING POMERANIAN / M RTO STRAY A665763 SMDOG39 WEST HIGHLAND 5 / 6 S RTO STRAY A665838 RECEIVING AUST SHEPHERD/ QUEENE 1 / 3 M RTO STRAY A610231 55 LABRADOR RETR 7 / 10 M RTO STRAY A665939 RECEIVING SHIH TZU 7 / 1 F RTO STRAY A665941 RECEIVING BLUETICK HOUND/ MIX 4 / 1 N RTO STRAY A644068 53 LABRADOR RETR 3 / 5 N RTO STRAY A326978 RECEIVING AUST SHEPHERD/ MIX 8 / 6 S RTO STRAY A665813 RECEIVING BOXER / S RTO STRAY A666055 RECEIVING BOXER 9 / 1 M RTO CONFISCATE A665696 56 PIT BULL 0 / 10 M RTO STRAY A665949 RECEIVING CHIHUAHUA LH 3 / 5 N RTO STRAY A665929 RECEIVING COCKER SPAN 9 / 11 M RTO STRAY A665985 SMDOG39 PEKINGESE 11 / 6 S RTO CONFISCATE A666007 CINT40 CHIHUAHUA SH I MIX 2 / 1 F RTO Total : 199 HAC"al ReportsNonthy Reports\Ovtoome Totals.rpt 9 P501 STAFF REPORT Z CITY MANAGER'S OFFICE RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of the City Council John R. Gillison, City Manager From: Erika Lewis-Huntley, Management Analyst II By: Michael Parmer, Management Aide Subject: APPROVAL TO ACCEPT A 2-YEAR FIRST 5 SAN BERNARDINO CONTRACT EXTENSION IN THE AMOUNT OF $651,367 AND ALLOCATE FISCAL YEAR 2013- 2014 FUNDS IN THE AMOUNT OF $319,264 INTO HEALTHY RC REVENUE ACCOUNT NO. 1218000-4905 AND APPROPRIATE $82,194 INTO ACCOUNT NO. 1218102-5000, $15,850 INTO ACCOUNT NO. 1218102-5010, $39,995 INTO ACCOUNT NO. 1218102-5030, $103,725 INTO ACCOUNT NO. 1218102-5200, AND $77,500 INTO ACCOUNT NO. 1218102-5300 FOR COSTS ASSOCIATED WITH THE DEVELOPMENT AND COORDINATION OF VARIOUS HEALTHY RC PROGRAMS AND ACTIVITIES. RECOMMENDATION Staff recommends that the City Council grant approval to accept a 2-year First 5 San Bernardino contract extension in the amount of $651,367 and allocate fiscal year 2013-2014 funds in the amount of $319,264 into Healthy RC Revenue Account No. 1218000-4905 and appropriate $82,194 into Account No. 1218102-5000, $15,850 into Account No. 1218102-5010, $39,995 into Account No. 1218102-5030, $103,725 into Account No. 1218102-5200, and $77,500 into Account No. 1218102-5300 for costs associated with the development and coordination of various Healthy RC programs and activities for children ages 0-5 and their families. BACKGROUND The City of Rancho Cucamonga recently applied for a competitive grant and was successfully awarded $651,367 ($319,264 for fiscal year 2013-2014 and $332,103 for fiscal year 2014-2015) from First 5 San Bernardino. First 5 San Bernardino's Healthy Cities initiative improves the health outcomes for pregnant women and children (ages 0-5). The grant is effective from July 1, 2013 to June 30, 2015. The grant will fund the following Healthy RC initiatives: • Strategic Plan — developing and finalizing a 5 year strategic plan to formalize health-related strategies, policies, programs, and partnerships to improve the health and wellness of the community. • Bringing Health Home Farmer's Market Incentive Program — expanding the financial incentive program to stimulate healthy food purchases for pregnant women and families with children 0-5. Incentives are provided with dollar-match vouchers up to $50 per month for produce at Rancho Cucamonga farmer's markets. • Nutrition and Beverage Standards — ensuring access to healthy options by implementing a healthy vending machine at one additional City facility stocked with healthy foods that are aligned with the City's Nutrition and Beverage Standards Policy. P5O2 ERROR!NO TEXT OF SPECIFIED STYLE IN DOCUMENT. PAGE 2 j ui x 3,2013 • Healthy RC Dining Program — working with local restaurants and registered dieticians, healthy food options will be identified and branded under Healthy RC Dining Program and participating restaurants will receive promotional incentives. • Community Engagement — supporting ongoing community engagement and collaboration efforts. • Breastfeeding Friendly Policies and Lactation Support Program — developing two additional mother's rooms and creating a comprehensive education program to promote breastfeeding. FISCAL IMPACT No matching funds required. P5O3 STAFF REPORT ADMINISTRATIVE SERVICES DEPARTMENT RANCHO Date: July 3, 2013 CUCAMONGA To: Mayor and Members of City Council John R. Gillison, City Manager From: Lori E. Sassoon, Deputy City Manager/Administrative Services By: Ingrid Y. Bruce, GIS/Special Districts Manager Subject: APPROVAL OF A RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS FOR COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED$15,000,000(FIFTEEN MILLION DOLLARS)AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS. RECOMMENDATION It is recommended that the City Council approve a resolution authorizing the issuance of Bonds for Community Facilities District No. 2003-01 designated Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013 in an aggregate principal amount not to exceed $15,000,000 (fifteen million dollars) (the "Special Tax Refunding Bonds') and the defeasance and refunding of prior special tax bonds, approving the form of a Fiscal Agent Agreement, Escrow Deposit and Trust Agreement, Bond Purchase Agreement, Preliminary Official Statement, Continuing Disclosure Certificate, and other documents and authorizing certain actions in connection with the issuance of such revenue bonds. BACKGROUND The City Council, acting for and on behalf of itself and in its capacity as the legislative body of the Community Facilities District 2003-01, is being asked to consider authorizing the issuance of special tax refunding bonds (the `Refunding Bonds') for the purpose of refunding the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A (the "Prior Special Tax Bonds") issued for such community facilities district. The anticipated savings projected to result from the refunding will be generated from the existence of favorable interest rate conditions in the municipal bond market and the maturity of the district; i.e., completion of substantial development and the diversity of ownership within Improvement Area No. 1 creates a better overall credit for the district. Based upon pro formas run to date the refunding has the potential of saving the property owners approximately 10% to 12% annually over the remaining life of the bond issues. The actual level of savings will depend upon conditions in the municipal bond market at the time the Special Tax Refunding Bonds are priced. P5O4 PAGE APPROVAL OF A RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS FOR COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $15,000,000(FIFTEEN MILLION DOLLARS)AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS. JUr_y 3,2013 For the reasons stated above, staff is recommending approval of the attached resolution and sale of the special tax refunding bonds. By approving the attached resolution the City Council will be: • Approving the issuance of the Special Tax Refunding Bonds; • Approving the form of the following agreements: • Fiscal Agent Agreement to establish the terms and conditions pursuant to which the Special Tax Refunding Bonds will be issued and administered; • Bond Purchase Agreement with Stifel, Nicholaus & Company, Incorporated ("Underwriter") to establish the terms and conditions pursuant to which the Special Tax Refunding Bonds will be sold to the Underwriter; and • Escrow Deposit and Trust Agreement to establish the terms and conditions pursuant to which the Prior Special Tax Bonds will be defeased and refunded. • Approving the form of: • the Preliminary Official Statement that will provide disclosure to prospective purchasers of the Special Tax Refunding Bonds and the Community Facilities District 2003-01 and Improvement Area No. 1 thereto, and • the Continuing Disclosure Certificate that constitutes the agreement by the City to provide continuing disclosure to the owners of the Special Tax Refunding Bonds and the municipal bond market in order to comply with the requirements of federal securities law and regulations. • Authorizing the City Manager, Deputy City Manager and the Finance Director to execute the various agreements and other documents subject to the pricing of the Special Tax Refunding Bonds meeting the financial parameters included in the resolution. Attachments: Resolution Agreements Preliminary Official Statement P505 RESOLUTION NO. 13-110 RESOLUTION OF THE CITY COUNCIL OF CITY OF RANCHO CUCAMONGA AUTHORIZING THE ISSUANCE OF BONDS OF COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $15,000,000, AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS OF SUCH DISTRICT ISSUED FOR IMPROVEMENT AREA NO. 1 THEREOF, APPROVING THE FORM OF A FISCAL AGENT AGREEMENT AND AUTHORIZING NEGOTIATION OF TERMS OF THE SALE OF SAID BONDS, APPROVING A PRELIMINARY OFFICIAL STATEMENT, AUTHORIZING PREPARATION OF A FINAL OFFICIAL STATEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS WHEREAS, the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District") was established and Improvement Area No. 1 and Improvement Area No. 2 (each, an `Improvement Area") were designated therein on February 19, 2003 pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the California Government Code) (the "Act'), by adoption by the City Council (the "City Council") of City of Rancho Cucamonga (the "City") of Resolution No. 03-031; and WHEREAS, under the provisions of the Act, on February 19, 2003, the City Council also adopted Resolution No. 03-032 which resolution, among other matters, expressed the determination of the City Council of the necessity to issue special tax bonds in the maximum aggregate principal amount of $16,000,000 for Improvement Area No. 1 of the District; WHEREAS, on February 19, 2003, consolidated special elections were held within Improvement Area No. 1 and there was submitted to the qualified voters of Improvement Area No. 1, among other propositions, the proposition of whether a bonded indebtedness in an aggregate principal amount not to exceed $16,000,000 should be incurred by and for the District for Improvement Area No. 1 for the purpose of providing public facilities for the benefit of the Improvement Area No. 1, and more than two-thirds of the votes cast in such consolidated special elections were cast in favor of incurring such bonded indebtedness, and the District is therefore authorized to issue bonds for Improvement Area No. 1 in an aggregate principal amount not to exceed $16,000,000 for the purposes set forth in said proposition; and WHEREAS, on May 21, 2003, the City Council adopted Resolution No. 03-125 authorizing the issuance and sale of bonds of the District for Improvement Area No. 1 pursuant to the Fiscal Agent Agreement, dated as of July 1 , 2003 (the "Prior Fiscal Agent Agreement'), by and between the City, for and on behalf of the District, 60285.00019\7782339.3 P506 and Wells Fargo Bank, National Association, as fiscal agent, designated the "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A" (the "Prior Special Tax Bonds'), for the purpose of funding the acquisition, rehabilitation and construction of certain public improvements for the benefit of Improvement Area No. 1; and WHEREAS, on August 7, 2003 the Prior Special Tax Bonds were issued in the aggregate principal amount of $14,645,000; and WHEREAS, the Prior Special Tax Bonds are outstanding in the aggregate principal amount of$14,250,000; and WHEREAS, as a result of a combination of favorable conditions in the municipal bond market and the level of development, diversity of ownership and increase in value of the properties within Improvement Area No. 1, the City Council has determined that it is necessary that bonds of the District to be designated "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013" be issued in an aggregate principal amount that will not exceed $15,000,000 (the `Bonds') for the purpose of defeasing and refunding the Prior Special Tax Bonds in order to provide debt service savings and reduce the levy of the special taxes within Improvement Area No. 1; and WHEREAS, the Bonds shall be issued pursuant to the terms and provisions of the Act and the statement of goals and policies of the City Council regarding the establishment of community facilities districts, as amended to date (the "Goals and Policies'); and WHEREAS, payment of the principal of and interest on the Bonds will be secured by special taxes to be levied on parcels of taxable property in Improvement Area No. 1 (the "Special Taxes"); and WHEREAS, pursuant to Section 53345.8 of the California Government Code, the City Council, as the legislative body of the District, may sell bonds of the District for Improvement Area No. 1 only if it determines prior to the award of the sale of such bonds that the value of the real property that would be subject to the special tax to pay debt service on such bonds will be at least three (3) times the principal amount of such bonds to be sold and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area No. 1; and WHEREAS, David Taussig & Associations, the special tax consultant to the City, has determined, based on a review of the San Bernardino County Assessor's Assessment Roll for fiscal year 2012-13, that the total assessed value of taxable property in Improvement Area No. 1 is $ 348,454,133; and WHEREAS, upon the issuance of the Bonds and the deposit of the appropriate portion of the proceeds of the sale of the Bonds in the escrow fund to be established to accomplish the defeasance and refunding of the Prior Special Tax 60285.00019\7782339.3 2 P507 Bonds, the Prior Special Tax Bonds will be defeased and the property in Improvement Area No. 1 will no longer be subject to the levy of special taxes to pay debt service on the Prior Special Tax Bonds; and WHEREAS, if the Bonds are issued and sold in an aggregate principal amount that does not exceed $15,000,000, the value of the parcels of real property within the District that will be subject to the levy of the Special Taxes will be more than three (3) times the principal amount of the Bonds; and WHEREAS, there will be no other bonds outstanding, other than the Bonds, that are secured by a special tax or a special assessment levied on property within Improvement Area No. 1; and WHEREAS, there has been presented to the City Council a form of Bond Purchase Agreement whereby Stifel, Nicolaus & Company, Incorporated, as underwriter (the "Underwriter") will purchase the Bonds from the District (the 'Bond Purchase Agreement'); and WHEREAS, there has also been presented to the City Council a form of Fiscal Agent Agreement with respect to the Bonds (the "Fiscal Agent Agreement') to be executed and delivered by the City and Wells Fargo Bank, National Association, as Fiscal Agent, whereby the Fiscal Agent will authenticate and deliver the Bonds and perform certain other duties; and WHEREAS, there has also been presented to the City Council a form of Escrow Deposit and Trust Agreement with respect to the Prior Special Tax Bonds (the "Escrow Agreement") to be executed and delivered by the City and Wells Fargo Bank, National Association, as Escrow Agent, whereby the Escrow Agent will receive a portion of the proceeds of the sale of the Bonds and certain funds related to the Prior Special Tax Bonds that will be deposited in an escrow fund to provide for the defeasance and redemption of the Prior Special Tax Bonds, and will perform certain other duties; and WHEREAS, there has also been presented to the City Council a form of Preliminary Official Statement relating to the Bonds (the 'Preliminary Official Statement'); and WHEREAS, there has also been presented to the City Council a form of Continuing Disclosure Certificate to be executed and delivered by the City and Wells Fargo Bank, National Association, as Dissemination Agent (the "Continuing Disclosure Certificate"), for the benefit of the owners of the Bonds and in order to assist the Underwriter in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission (the "Rule"); and WHEREAS, the City Council has considered the forms of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Bond Purchase Agreement, the Preliminary Official Statement, and the Bond Purchase Agreement, and has determined that it is in the best interest of the owners of property in and the residents of the District that the City Council authorize the issuance and sale of 60285.00019\7782339.3 3 P508 the Bonds and the execution and delivery of said agreements, and approve and authorize the distribution of the Preliminary Official Statement, subject to the conditions hereinafter contained; NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, acting for and on behalf of the City and in its capacity as the legislative body of the District, as follows: Section 1. Findings. The City Council finds (a) that the preceding recitals are true and correct, (b) that the sale of the Bonds at private sale, without advertising for bids, will result in a lower overall cost to the District, (c) that if the Bonds are issued and sold in an aggregate principal amount that does not exceed $15,000,000, the value of the parcels of real property within the District that will be subject to the levy of the Special Taxes to pay the principal of and interest on the Bonds will be more than three (3) times the aggregate principal amount of the Bonds, and (d) that upon the issuance of the Bonds there will be no other bonds, other than the Bonds, that will be secured by a special tax or a special assessment levied on property within the District. In furtherance of the issuance of the Bonds, the City Council hereby makes the following further findings and determinations: (i) that it is prudent in the management of the fiscal affairs of the City, the City Council and the District to issue the Bonds for the purpose, inter alia, of refunding the Prior Special Tax Bonds on an current basis, (ii) that the total net interest cost to maturity on the portion of the Bonds being issued to refund the Prior Special Tax Bonds plus the principal amount of the portion of the Bonds being issued to refund the Prior Special Tax Bonds will not exceed the total net interest cost to maturity on the Prior Special Tax Bonds plus the principal amount of the Prior Special Tax Bonds, and (iii) that the issuance of the Bonds is in compliance with the City's Goals and Policies. For purposes of Section 53363.2 of the Act, the City Council hereby further finds and determines: (i) that it is expected that the purchase of the Bonds will occur on or after July 15, 2013, (ii) that the date, denomination, maturity dates, places of payment and form of the Bonds shall be as set forth in the Fiscal Agent Agreement, as executed, (iii) that the maximum true interest cost to be paid on the Bonds shall not exceed six percent (6.00%) with the actual rate or rates to be set forth in the Fiscal Agent Agreement as executed; (iv) the place of payment for the Prior Special Tax Bonds shall be as set forth in the fiscal agent agreement for the Prior Special Tax Bonds; and (v) the designated costs of issuing the Bonds shall be as described in Section 53363.8(a) of the Act, and as otherwise described in the Fiscal Agent Agreement, in the Official Statement for the Bonds and in the closing certificates for the Bonds, including Bond Counsel fees and expenses, Disclosure Counsel fees and expenses, Underwriter's discount, printing costs for the Official Statement, Special Tax Consultant, Financing Consultant, escrow verification costs, initial fiscal agent fees, fees for credit enhancement and ratings on the Bonds, and costs of City staff incurred in connection with the sale and issuance of the Bonds. 60285.00019\7782339.3 4 P509 Section 2. Authorization of the Issuance of the Bonds. The City Council authorizes the issuance and sale of the Bonds in an aggregate principal amount that shall not exceed $15,000,000, and the City Manager (the "City Manager"), the Deputy City Manager (the "Deputy City Manager"), the Director of Finance (the "Director of Finance") of the City and such other designee of the City Manager (each of the City Manager, the Deputy City Manager, the Director of Financing and any such designee, an "Authorized Representative") are authorized and directed to take all steps and actions which are necessary to accomplish the issuance, sale and delivery of the Bonds pursuant to the authorization given by and the conditions specified in this resolution. The Mayor and the City Clerk of the City Council are authorized to execute the Bonds for and on behalf of the City and the District by their manual or facsimile signatures. The Bonds shall be dated as of their date of delivery pursuant to the Bond Purchase Agreement. The last maturity date of the Bonds shall not be later than the last maturity date of any of the Prior Special Tax Bonds. Each Authorized Representative, acting on behalf of the City or the District, as applicable, is hereby authorized and directed to execute and deliver the final form of the various documents and instruments described in this Resolution, with such additions thereto or changes therein as such Authorized Representative may deem necessary and advisable; provided, however, that no additions or changes shall authorize an aggregate principal amount of the Bonds in excess of the amount specified in the preceding paragraph. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery of such documents or instruments by an Authorized Representative, following consultation with and review by Best Best & Krieger LLP, as bond counsel. Section 3. Approval of Fiscal Agent Agreement. The Fiscal Agent Agreement which provides generally for (i) the authentication and delivery by the Fiscal Agent of the Bonds, (ii) the establishment and administration by the Fiscal Agent of certain funds and accounts for the benefit of the City and the owners of the Bonds, (iii) the payment by the Fiscal Agent of the principal of and interest on the Bonds from the Special Tax Revenues (as defined therein), and (iv) the performance of other duties by the Fiscal Agent, is approved in the form submitted to the City Council at the meeting at which this resolution is adopted. Section 4. Appointment of Fiscal Agent. Wells Fargo Bank, National Association is appointed as Fiscal Agent pursuant to the Fiscal Agent Agreement, to take any and all action provided therein to be taken by the Fiscal Agent. Section 5. Approval of Escrow Agreement. The Escrow Deposit and Trust Agreement (the "Escrow Agreement') which provides for (i) the defeasance and redemption of the Prior Special Tax Bonds, (ii) the creation and administration by the Escrow Agent of the Escrow Fund for the benefit of the owners of the Prior Special Tax Bonds, and (iii) the performance of other duties by the Escrow Agent, is approved in the form presented to the City Council at the meeting at which this resolution is adopted. 60285.00019\7782339.3 5 P510 Notwithstanding the preceding provisions of this section, as required by Section 53363.9 of the California Government Code, the amount of the proceeds of the sale of the Bonds and other amounts to be deposited in the Escrow Fund, and earnings from the investment thereof, shall be in an amount sufficient to pay the principal of and interest on the Prior Special Tax Bonds on September 1, 2013 and to pay the principal and redemption premium due on the Prior Special Tax Bonds on such date, and the designated costs of issuing the Bonds, as certified by a certified public accountant licensed to practice in the State of California. Section 6. Appointment of Escrow Agent. Wells Fargo Bank, National Association is appointed as Escrow Agent pursuant to the Escrow Agreement to take any and all action provided therein to be taken by the Escrow Agent. Section 7. Approval of Preliminary Official Statement: Preparation of Final Official Statement. The Preliminary Official Statement is approved, and each of the Authorized Representatives is authorized to consent to and assist in the preparation of such modifications thereto as may be specified by Jones Hall, disclosure counsel to the City ("Disclosure Counsel'). Each of the Authorized Representatives is authorized to determine, with the assistance of Disclosure Counsel, when the Preliminary Official Statement is to be deemed final within the meaning of the Rule and to deliver a certificate to that effect to the Underwriter. The Underwriter is authorized to distribute the Preliminary Official Statement as approved hereby, or as modified with the consent of one of the Authorized Representatives, to prospective purchasers of the Bonds. The City Manager, the Deputy City Manager and the Director of Finance are authorized to participate in the preparation of the Final Official Statement, based on the Preliminary Official Statement, and such modifications thereto as may be agreed to by Disclosure Counsel and the Underwriter. An Authorized Representative is authorized to sign the Final Official Statement on behalf of the City and the District. Section 8. Issuance of Bonds. The City Council approves and authorizes the issuance and sale of the Bonds by negotiation with the Underwriter and the City pursuant to the Bond Purchase Agreement between the City and the Underwriter in the form presented to the City Council at the meeting at which this resolution is adopted, together with any changes therein or additions thereto which are deemed advisable by the City Manager, the Deputy City Manager or the Director of Finance, upon consultation with Bond Counsel. An Authorized Representative is authorized and directed to execute and deliver the final form of the Bond Purchase Agreement on behalf of the City and the District upon the submission of an offer by the Underwriter to purchase the Bonds, which offer is acceptable to the City Manager, the Deputy City Manager or the Director of Finance and is consistent with the requirements of this resolution; provided that the interest rate on any maturity of the Bonds shall not exceed seven percent (7.00%) per annum; the Underwriter's discount for the purchase of the Bonds shall exceed one and one half percent (1.50%) of the aggregate principal amount of the Bonds; and the last maturity of date of the Bonds shall not be later than the last maturity date of the Prior Special Tax Bonds. When the City Manager, the Deputy City Manager or the Director of Finance has negotiated the Bond Purchase Agreement with the Underwriter within the parameters specified above and when the 60285.00019\7782339.3 6 P511 other terms and conditions of the are satisfactory to the City Manager, the Deputy City Manager or the Director of Finance and Bond Counsel, an Authorized Representative is authorized to execute and deliver the Bond Purchase Agreement to the Underwriter on behalf of the City and the District. No Authorized Representative shall execute and deliver the Bond Purchase Agreement, however, unless the total net interest cost to maturity of the Bonds plus the principal amount of the Bonds will be less than the total net interest cost to maturity with respect to the Prior Special Tax Bonds, plus the principal amounts of the Prior Special Tax Bonds, and before executing and delivering the Bond Purchase Agreement, the Authorized Representative shall receive verbal verification from Fieldman Rolapp & Associates, as the Financial Advisor to the City and the District, that such a total net interest cost and principal amount with respect to the Bonds will be achieved. Section 9. Reserve Fund and Other Funds Related to the Prior Special Tax Bonds. The City Manager, the Deputy City Manager or the Director of Finance is authorized (i) to direct the fiscal agent for the Prior Special Tax Bonds, and said fiscal agent is authorized, to transfer the amount on deposit in the funds and accounts that are held by the fiscal agent pursuant to the fiscal agent agreement for the Prior Special Tax Bonds, including the reserve fund for the Prior Special Tax Bonds, to the Escrow Agent for deposit in the Escrow Fund to be used to defease and redeem the Prior Special Tax Bonds, or to transfer the amount of deposit in such reserve fund to the Reserve Fund for the Bonds, whichever the City Manager, the Deputy City Manager or the Director of Finance determines, in consultation with Bond Counsel, is most appropriate. Section 10. Notice of Redemption. The City Manager, the Deputy City Manager or the Director of Finance is authorized and directed to provide for the mailing, and the Fiscal Agent, in its capacity as fiscal agent for the Prior Special Tax Bonds is authorized to mail notice, of the redemption of Prior Special Tax Bonds to the registered owners thereof as required by Section 53365 of the California Government Code and the fiscal agent agreement for the Prior Special Tax Bonds. Pursuant to said Section 53365, the City Manager, the Deputy City Manager or the Director of Finance shall also provide for the mailing of, and the Fiscal Agent, as such fiscal agent, shall mail, notice of the redemption of the Prior Special Tax Bonds to the investment banking firm which was the original purchaser and underwriter of the Prior Special Tax Bonds. Section 11. Approval of Continuing Disclosure Certificate. The Continuing Disclosure Certificate is approved in the form submitted to the City Council at the meeting at which this resolution is adopted, and an Authorized Representative is authorized to execute and deliver said agreement on behalf of the City. Section 12. Action. All actions heretofore taken by the City Manager, the Deputy City Manager, the Director of Finance and the other officers and agents of the City, acting for and on behalf of the City or the District, with respect to the establishment of the District, and the sale and issuance of the Bonds are hereby approved, confirmed, 60285.00019\7782339.3 7 P512 and ratified, and the proper officers of the City, acting for and on behalf of the City or the Community Facilities Districts, as applicable, are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements, contracts, and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with the Act, this Resolution, the Fiscal Agent Agreement, the Bond Purchase Agreement, the Escrow Agreement, the Continuing Disclosure Certificate and any certificate, agreement, contract, and other document described in the documents herein approved. Section 13. Conditions of Approval. The approvals, authorization and direction given by this resolution are conditioned upon the satisfaction of the requirements of Section 8 hereof with respect to the issuance and sale of the Bonds. The officers of the City designated above shall not take any action with respect to the execution and delivery of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, and the Bond Purchase Agreement or the issuance, sale and delivery of the Bonds unless and until such conditions are satisfied; provided, however, that upon satisfaction of such conditions, this resolution shall be fully effective and shall be carried out by such officers without further approval or action of the City Council. The approvals, authorization and direction provided by this resolution shall continue, subject to the satisfaction of such conditions, until December 31, 2013, and the Bonds may be sold, and the Bonds, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Bond Purchase Agreement, the Preliminary Official Statement, and the Final Official Statement may be dated, entered into, executed and delivered or distributed, as appropriate, on any date selected by the City Manager, the Deputy City Manager or the Director of Finance and the Underwriter prior to said date. 60285.00019\7782339.3 8 P513 Section 14. Effective Date. This resolution shall take effect upon adoption and shall remain in effect until December 31, 2013, or if the Bonds are issued prior to said date, until all of the Bonds are paid at or redeemed prior to maturity. PASSED, APPROVED AND ADOPTED this day of November 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on 2013. Executed this at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk 9 60285.00019A7782339.3 P514 FISCAL AGENT AGREEMENT by and between CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 and WELLS FARGO BANK, NATIONAL ASSOCIATION as Fiscal Agent Dated as of July 1, 2013 Relating to: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013 60285.00019\7761646.3 P515 TABLE OF CONTENTS Page FISCAL AGENT AGREEMENT.................................................................................................. 1 ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS...................................... 2 Section 1.01. Authority for this Agreement............................................................... 2 Section 1.02. Agreement for Benefit of Bondowners................................................ 2 Section 1.03. Definitions............................................................................................ 3 ARTICLE II THE BONDS ................................................................................................... 9 Section 2.01. Principal Amounts; Designations ........................................................ 9 Section 2.02. Terms of Bonds.................................................................................... 9 Section 2.03. Redemption........................................................................................ 11 Section 2.04. Form of Bonds ................................................................................... 13 Section 2.05. Execution of Bonds............................................................................ 13 Section 2.06. Transfer of Bonds .............................................................................. 14 Section 2.07. Exchange of Bonds............................................................................ 14 Section 2.08. Bond Register..................................................................................... 14 Section 2.09. Temporary Bonds............................................................................... 15 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen...................................... 15 Section 2.11. Type and Nature of the Bonds; Limited Obligation.......................... 15 Section 2.12. Equality of Bonds and Pledge of Net Special Tax Revenues............ 16 Section 2.13. Description of Bonds; Interest Rates ................................................. 16 Section 2.14. No Acceleration................................................................................. 16 Section 2.15. Additional Bonds............................................................................... 16 Section 2.16. Validity of the Bonds......................................................................... 17 Section2.17. Book-Entry.................................................................................................... 17 ARTICLE III ISSUANCE OF BONDS ............................................................................... 18 Section 3.01. Issuance and Delivery of the Bonds................................................... 18 Section 3.02. Application of Proceeds of Sale of the Bonds and Transfers from the Prior Special Tax Bonds...................................................... 19 Section 3.03. Special Tax Fund ............................................................................... 19 Section 3.04. Costs of Issuance Fund ...................................................................... 21 Section 3.05. Administrative Expense Fund............................................................ 21 60285.00019\7761646.3 -i- P516 TABLE OF CONTENTS (continued) Page ARTICLE IV NET SPECIAL TAX REVENUES; BOND FUND......................................22 Section 4.01. Pledge of Net Special Tax Revenues.................................................22 Section4.02. Bond Fund..........................................................................................22 Section4.03. Reserve Fund .....................................................................................23 ARTICLE V OTHER COVENANTS OF THE DISTRICT...............................................24 Section5.01. Warranty ............................................................................................ 24 Section5.02. Covenants........................................................................................... 24 Section 5.03. Punctual Payment...............................................................................24 Section 5.04. Limited Obligation.............................................................................25 Section 5.05. Payment of Claims.............................................................................25 Section 5.06. Extension of Time for Payment.........................................................25 Section 5.07. Against Encumbrances.......................................................................25 Section 5.08. Books and Records ............................................................................25 Section 5.09. Protection of Security and Rights of Owners ....................................25 Section 5.10. Collection of Special Tax Revenues..................................................25 Section 5.11. Further Assurances.............................................................................26 Section 5.12. Tax Covenants ................................................................................... 26 Section 5.13. Covenant to Foreclose........................................................................ 27 Section 5.14. Annual Reports to CDIAC................................................................. 28 Section 5.15. Continuing Disclosure to Owners......................................................28 Section 5.16. Public Access to Facilities.................................................................28 Section 5.17. Modification of Maximum Authorized Special Tax..........................28 Section 5.18. Covenant to Defend ...........................................................................29 ARTICLE VI INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE DISTRICT..................................................................29 Section 6.01. Deposit and Investment of Moneys in Funds ....................................29 Section 6.02. Rebate Fund; Rebate to the United States.......................................... 30 Section 6.03. Limited Obligation............................................................................. 30 Section 6.04. Liability of District ............................................................................31 Section 6.05. Employment of Agents by District or the City..................................32 60285.00019\7761646.3 -ii- P517 TABLE OF CONTENTS (continued) Page ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS............ 32 Section 7.01. Events of Default............................................................................... 32 Section 7.02. Remedies of Bond Owners................................................................ 32 Section 7.03. Application of Special Taxes and Other Funds After Default........... 33 Section 7.04. Absolute Obligation of the District.................................................... 33 Section 7.05. Termination of Proceedings............................................................... 34 Section 7.06. Remedies Not Exclusive.................................................................... 34 Section 7.07. No Waiver of Default......................................................................... 34 ARTICLE VIII THE FISCAL AGENT .................................................................................. 34 Section 8.01. Appointment of Fiscal Agent............................................................. 34 Section 8.02. Liability of Fiscal Agent.................................................................... 35 Section8.03. Information ........................................................................................ 36 Section 8.04. Notice to Fiscal Agent ....................................................................... 36 Section 8.05. Compensation, Indemnification......................................................... 37 ARTICLE IX MODIFICATION OR AMENDMENT OF THIS AGREEMENT............... 37 Section 9.01. Amendments Permitted...................................................................... 37 Section 9.02. Owners' Meetings.............................................................................. 38 Section 9.03. Procedure for Amendment with Written Consent of Owners............ 38 Section 9.04. Disqualified Bonds............................................................................. 39 Section 9.05. Effect of Supplemental Agreement.................................................... 39 Section 9.06. Endorsement or Replacement of Bonds Issued After Amendments...................................................................................... 39 Section 9.07. Amendatory Endorsement of Bonds.................................................. 39 ARTICLE X DEFEASANCE...........................:.................................................................. 40 Section 10.01. Defeasance......................................................................................... 40 ARTICLE XI MISCELLANEOUS ......................................................................................41 Section 11.01. Benefits of Agreement Limited to Parties .........................................41 Section 11.02. Cancellation of Bonds........................................................................41 Section 11.03. Successor is Deemed Included in All References to Predecessor ........................................................................................41 Section 11.04. Execution of Documents and Proof of Ownership by Owners..........41 60285.00019\7761646.3 _iii_ P518 TABLE OF CONTENTS (continued) Page Section 11.05. Waiver of Personal Liability..............................................................42 Section 11.06. Notices to and Demands on District and Fiscal Agent...................... 42 Section 11.07. Partial Invalidity................................................................................. 43 Section 11.08. Unclaimed Moneys............................................................................43 Section 11.09. Provisions Constitute Contract .......................................................... 43 Section 11.10. Future Cont racts.................................................................................43 Section 11.11. Further Assurances.............................................................................43 Section 11.12. Applicable Law..................................................................................43 Section 11.13. Conflict with Act................................................................................44 Section 11.14. Conclusive Evidence of Regularity ...................................................44 Section 11.15. Payment on Business Day.................................................................. 44 Section 11.16. Counterparts....................................................................................... 44 EXHIBIT A FORM OF BOND.................................................................................................A-1 60285.00019\7761646.3 _iv_ P519 FISCAL AGENT AGREEMENT THIS FISCAL AGENT AGREEMENT (the "Agreement') is made and entered into as of July 1, 2013, by and between the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District'), a community facilities district, organized and existing under and by virtue of the laws of the State of California, and Wells Fargo Bank, National Association, a national banking association organized and existing under the laws of the United States of America, as fiscal agent (the "Fiscal Agent'). WITNESSETH: WHEREAS,the City Council of the City of Rancho Cucamonga (the "City") has formed the District and designated Improvement Area No. 1 therein under the provisions of the Mello- Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the California Government Code) (the "Act') and Resolution No. 03-031 of the City Council adopted on February 19, 2003; WHEREAS, the City Council is authorized under the Act and pursuant to Ordinance No. 699 to levy special taxes within Improvement Area No. 1 to pay for the costs of facilities provided by the District; WHEREAS, under the provisions of the Act, on February 19 , 2003, the City Council, acting as the legislative body of the District and Improvement Area No. 1, adopted Resolution No. 03-032 (the "Resolution") which resolution, among other matters, expressed the determination of the City Council of the necessity to issue special tax bonds in the maximum aggregate principal amount of$16,000,000 for Improvement Area No. 1 of the District secured by the special taxes; WHEREAS, on May 21, 2003, the City Council adopted Resolution No. 03-125 (the "Resolution") authorizing the issuance and sale of bonds for the District pursuant to the Fiscal Agent Agreement, dated as of July 1, 2003 (the "Prior Fiscal Agent Agreement'), by and between the City of Rancho Cucamonga, for and on behalf of the District, and Wells Fargo Bank, National Association, as fiscal agent, designated the "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A" (the "Prior Special Tax Bonds"), for the purpose of funding the acquisition, rehabilitation and construction of certain public improvements (defined in the Prior Fiscal Agent Agreement as the "Project'); WHEREAS, on August 7, 2003 the Prior Special Tax Bonds in the principal amount of $14,645,000 were issued; WHEREAS, on July 3, 2013, the City Council adopted Resolution No. 13- (the "Resolution of Issuance") authorizing the issuance and sale of bonds of the District pursuant to this Agreement designated "City of Rancho Cucamonga Community Facilities District No. 2003- 01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013" (the "Bonds"), for the purpose of financing the defeasance and refunding of the Prior Special Tax Bonds; 60285.00019\7761646.3 1 P520 WHEREAS, it is in the public interest and for the benefit of the City, the District, the persons responsible for the payment of special taxes and the owners of the Bonds that the District enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the Bonds, and the administration and payment of the Bonds; WHEREAS, all things necessary to cause the Bonds, when authenticated by the Fiscal Agent and issued as provided in the Act, the Resolution and this Agreement, to be legal, valid and binding and limited obligations in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized; NOW, THEREFORE, in order to secure the payment of the principal of, premium, if any, and the interest on all Bonds at any time issued and outstanding under this Agreement, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the holders thereof, and for other valuable considerations, the receipt of which is hereby acknowledged, the District does hereby covenant and agree with the Fiscal Agent, for the benefit of the respective holders from time to time of the Bonds, as follows: ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Section 1.01. Authority for this Agreement. This Agreement is entered into pursuant to the provisions of the Act and the Resolution. Section 1.02. Agreement for Benefit of Bondowners. The provisions, covenants and agreements herein set forth to be performed by or on behalf of the District shall be for the equal benefit, protection, and security of the Owners from time to time. In consideration of the acceptance of the Bonds by the Owners thereof, this Agreement shall be deemed to be and shall constitute a contract between the District and the Owners; and the covenants and agreements herein set forth to be performed by the District shall be for the equal and proportionate benefit, security, and protection of all Owners of the Bonds without preference, priority or distinction as to security or otherwise of any of the Bonds over any of the others by reason of the number or date thereof or the time of sale, execution, or delivery thereof, or otherwise for any cause whatsoever, except as expressly provided therein or herein. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided in or permitted by this Agreement. The Fiscal Agent may become the Owner of any of the Bonds in its own or any other capacity with the same rights it would have if it were not Fiscal Agent. 60285.00019\7761646.3 2 P521 Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words "herein," "hereof," "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or subdivision hereof. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311 et seq. of the California Government Code. "Administrative Expense Fund" means the fund by that name established by Section 3.05 hereof. "Administrative Expenses" means any or all of the following: the fees and expenses of the Fiscal Agent (including the fees and expenses of its counsel), the expenses of the City, acting for and on behalf of the District, or the District in carrying out its duties hereunder (including, but not limited to, the levying and collection of the Special Taxes, complying with the disclosure provisions of the Act, the Continuing Disclosure Agreement and this Agreement, including those related to public inquiries regarding the Special Tax and disclosures to Bondowners and the Original Purchaser); the costs of the City and the District or their designees related to an appeal of the Special Tax; any costs of the City and the District(including fees and expenses of counsel) to defend the first lien on and pledge of the Special Taxes to the payment of the Bonds or otherwise in respect of litigation relating to the District or the Bonds or with respect to any other obligations of the District, the salaries of City staff directly related to the carrying out by the City, for and on behalf of the District, the District's obligations hereunder and a proportionate amount of City general administrative overhead related thereto allocable to the Bonds; and all other costs and expenses of the City, the District, and the Fiscal Agent incurred in connection with the discharge of their respective duties hereunder, and in the case of the City, in any way related to the administration of the District and all actual costs and expenses incurred in connection with the administration of the Bonds. "Agreement" means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement adopted pursuant to the provisions hereof. "Annual Debt Service" means, for each Bond Year, the sum of(i) the interest due on the Outstanding Bonds in such Bond Year, and (ii) the principal amount of the Outstanding Bonds scheduled to be paid in such Bond Year. "Auditor" means the auditor/tax collector of the County of San Bernardino. "Authorized Officer" means the City Manager, Assistant City Manager, Deputy City Manager, Director of Finance, or City Clerk of the City, or any other officer or employee authorized by the City Council of the City or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer. 60285.00019\7761646.3 3 P522 "Bond Counsel" means (i) Best Best & Krieger LLP; or (ii) any attorney or firm of attorneys acceptable to the District and nationally recognized for expertise in rendering opinions as to the legality and tax-exempt status of securities issued by public entities. "Bond Fund" means the fund by that name established by Section 4.02A hereof. "Bond Year" means the one-year period beginning on September 2 in each year and ending on September 1 in the following year except that the first Bond Year shall begin on the Closing Date and end on September 1, 2013. "Bonds" means the City of Rancho Cucamonga Community Facilities District No. 2003- 01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013, authorized by, and at any time Outstanding pursuant hereto. "Business Day" means a day which is not a Saturday, Sunday, or legal holiday on which banking institutions in the State of California, or in any state in which the Principal Office of the Trustee is located, or the New York Stock Exchange are closed. If any payment hereunder is due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day with the same effect as if made on such previous day. "CDIAC" means the California Debt and Investment Advisory Commission of the office of the State Treasurer of the State of California or any successor agency or bureau thereto. "City"means the City of Rancho Cucamonga, California. "City Council" means the City Council of the City, acting in its capacity as the legislative body of the District. "Closing Date" means the date upon which there is a physical delivery of the Bonds in exchange for the amount representing the purchase price of the Bonds by the Original Purchaser. "Code" means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable proposed, temporary and final regulations promulgated, and applicable official public guidance published, under the Code. "Continuing Disclosure Certificate" means that certain Continuing Disclosure Certificate relating to the Bonds, executed on the Closing Date by City, as originally executed and as it may be amended from time to time in accordance with the terms thereof. "Costs of Issuance" means items of expense payable or reimbursable directly or indirectly by the District and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding documents, including but not limited to the preliminary official statement and official statement regarding the Bonds, closing costs, filing and recording fees, initial fees and charges of the Fiscal Agent including its first annual administration fee and the fees of its counsel, expenses incurred by the District in connection with the issuance of the Bonds, legal fees and charges, 60285.00019\7761646.3 4 P523 including the fees of Bond Counsel and Disclosure Counsel, financial advisor's fees, charges for authentication, transportation and safekeeping of the Bonds and other costs, charges and fees in connection with the foregoing. "County" means the County of San Bernardino, California. "Debt Service" means the scheduled amount of interest and amortization of principal payable on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. "Defeasance Obligations" means those obligations described in paragraph A. of the definition of Permitted Investments. "District" means the City of Rancho Cucamonga Community Facilities District No. 2003-01 formed pursuant to the Resolution of Formation. "DTC" means the Depository Trust Company. "Escrow Agent" means Wells Fargo Bank, National Association, acting as escrow agent under the Escrow Agreement. "Escrow Agreement" means that Escrow Agreement Deposit and Trust Agreement dated as of July 1, 2013 by and between the District and the Escrow Agent relating to defeasance of the Prior Special Tax Bonds. "Fair Market Value" means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm's length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of section 1273 of the Code) and, otherwise, the term "Fair Market Value" means the acquisition price in a bona fide arm's length transaction (as referenced above) if(i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code; (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement) that is acquired in accordance with applicable regulations under the Code; (iii)the investment is a United States Treasury Security - State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt; or (iv) any commingled investment fund in which the City and related parties do not own more than a ten percent (10%) beneficial interest therein if the return paid by the fund is without regard to the source of the investment. "Fiscal Agent" means the Fiscal Agent appointed by the District and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 8.01. "Fiscal Year" means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive. 60285.0001%7761646.3 5 P524 "Independent Accountant" means any nationally recognized firm of certified public accountants or firm of such accountants duly licensed or registered or entitled to practice and practicing as such under the laws of the State, appointed by the City, acting for and on behalf of the District, and who, or each of whom: (1) is in fact independent and not under domination of the City or the District; (2) does not have any substantial interest, direct or indirect, with the City or the District; and (3) is not connected with the City or the District as an officer or employee of the City or the District, but who may be regularly retained to make reports to the City or the District. "Independent Financial Consultant" means any financial consultant or firm of such financial consultants appointed by the City, acting for and on behalf of the District, and who, or each of whom: (1) is judged by the City to have experience with respect to the financing of public capital improvement projects; (2) is in fact independent and not under the domination of the City or the District; (3) does not have any substantial interest, direct or indirect, with the City or the District; and (4) is not connected with the City, or the District as an officer or employee of the City or the District, but who may be regularly retained to make reports to the City, or the District. "Interest Payment Dates" means March I and September 1 of each year, commencing September 1, 2013. "Investment Earnings" means all interest earned and any gains and losses on the investment of moneys in any fund or account created by this Agreement. "Maximum Annual Debt Service" means the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of any Outstanding Bonds. "Net Special Tax Revenues" means, for each Fiscal Year, all Special Tax Revenues received by the District less an amount equal to the Priority Administrative Expenses Amount. "Officer's Certificate" means a written certificate of the District or the City signed by an Authorized Officer of the City. "Ordinance" means an ordinance of the City levying the Special Taxes, including Ordinance No. 699, adopted by the City Council on 2003. 60285.00019\7761646.3 6 P525 "Original Purchaser" means the first purchaser of the Bonds from the District. "Outstanding," means (subject to the provisions of Section 9.04), when used as of any particular time with reference to Bonds, all Bonds except: (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 10.01; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued, and delivered by the District pursuant to this Agreement or any Supplemental Agreement. "Owner" or `Bondowner" means any person who shall be the registered owner of any Outstanding Bond. "Penalties and Interest" means any penalties or interest in excess of the interest payable on the Bonds collected in connection with delinquent Special Taxes. "Penalties and Interest Account" means the account by that name within the Special Tax Fund pursuant to Section 3.03D hereof. "Permitted Investments" shall have the meaning given such term in Exhibit B hereto. "Person" means an individual, corporation, firm, association, partnership, trust, or other legal entity or group of entities, including a governmental entity or any agency or political subdivision thereof. "Prepayments" means Special Tax Revenues identified to the Fiscal Agent by an Authorized Officer as representing a prepayment of the Special Tax pursuant to the RMA. "Principal Office" means the principal corporate trust office of the Fiscal Agent as may be designated from time to time by the Fiscal Agent in writing to the District initially set forth in Section 11.06 hereof. "Prior Fiscal Agent Agreement" means the Fiscal Agent Agreement, dated as of July 1, 2003, by and between the District and Wells Fargo Bank, National Association, as fiscal agent, . pertaining to the Prior Special Tax Bonds. "Prior Special Tax Bonds" means the outstanding City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A. "Priority Administrative Expense Amount" means an annual amount equal to $48,760.00, for fiscal year 2013-14 subject to escalation by 2% each fiscal year thereafter commencing July 1, 2014, or such lesser amount as may be designated by written instruction from an Authorized Officer of the District to be allocated as the first priority of Special Taxes received each Fiscal Year for the payment of Administrative Expenses allocated to the Bonds. "Project" shall have the meaning given such term in the Prior Fiscal Agent Agreement. 60285.00019\7761646.3 7 P526 "Rebate Certificate" means the certificate delivered by the District upon the delivery of the Bonds relating to Section 148 of the Code, or any functionally similar replacement certificate. "Rebate Fund"means the fund by that name established by Section 6.02 hereof. "Record Date" means the fifteenth day of the month next preceding the month of the applicable Interest Payment Date. "Representation Letter" means the representation letter which the City has delivered to The Depository Trust Company ("DTC") with respect to the utilization of the book-entry system maintained by DTC for the issuance and registration of bonds. "Reserve Fund"means the fund by that name established by Section 4.03 hereof. "Reserve Requirement" means on any date in any Bond Year the lesser of(i) ten percent (10%) of the stated principal amount of the Bonds, (ii) Maximum Annual Debt Service on the Bonds or (iii) 125 percent of average Annual Debt Service on the Bonds, as determined by the District. "Resolution of Formation" means Resolution No. 03-031, adopted by the City Council on February 19, 2003. "Resolution of Issuance" shall have the meaning given such term in the recitals hereto. "RMA" means the Rate and Method of Apportionment of the Special Tax for the District approved by the qualified electors within Improvement Area No. 1 of the District at a special election held on February 19, 2003. "Special Tax Fund" means the fund by that name established by Section 3.03A hereof. "Special Tax Revenues" means the proceeds of the Special Taxes received by the District including any scheduled payments and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest and penalties thereon. Notwithstanding the foregoing, "Special Tax Revenues" does not include Penalties and Interest. "Special Taxes" means the special taxes levied within Improvement Area No. 1 of the District pursuant to the Act, the RMA, the Ordinance, and this Agreement. "Supplemental Agreement" means an agreement the execution of which is authorized by a resolution which has been duly adopted by the City Council under the Act and which agreement is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder. "Treasurer" means the person who is acting in the capacity as treasurer or finance director to the City or the designee of either such officer. 60285.00019\7761646.3 8 P527 ARTICLE II THE BONDS Section 2.01. Principal Amounts; Designations. Bonds in the aggregate principal amount of Dollars ($ ) are hereby authorized to be issued by the District under and subject to the terms of the Resolution of Issuance and this Agreement, the Act and other applicable laws of the State of California. The Bonds shall be designated "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013." This Agreement constitutes a continuing agreement of the District with the Owners from time to time of the Bonds to secure the full payment of the principal of, premium, if any, and interest on all such Bonds subject to the covenants, provisions, and conditions herein contained. Section 2.02. Terms of Bonds. A. Form; Denominations. The Bonds shall be issued as fully registered bonds without coupons in the denomination of $5,000 or any integral multiple thereof; provided, however, one Bond from each maturity may be in an amount other than $5,000 or an integral multiple thereof. The Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent. B. Date of the Bonds. The Bonds shall be dated the Closing Date. C. Maturities, Interest Rates. The Bonds shall mature on the dates and shall bear interest at the rates as follows: 60285.00019\7761646.3 9 P528 Maturity Date (September 1) Principal Maturity Interest Rate 2013 2014 � • 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 D. Interest. The Bonds shall bear interest at the rates set forth above payable five (5) days preceding the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. E. Method of Payment. Interest on the Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check or draft of the Fiscal Agent mailed at least five (5) days preceding the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest 60285.00019\7761646.3 10 P529 Payment Date, or by wire transfer made on such Interest Payment Date upon instructions of any Owner of$1,000,000 or more in aggregate principal amount of Bonds. The principal of the Bonds and any premium on the Bonds are payable in lawful money of the United States of America upon surrender of the Bonds at the Principal Office of the Fiscal Agent. All Bonds paid by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and issue a certificate of destruction thereof to the District. Section 2.03. Redemption. A. Optional Redemption. The Bonds may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of$5,000) on any Interest Payment Date, from such maturities as are selected by the District, and by lot within a maturity, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20 10_% March 1, 20 and September 1, 20_ 10_ March 1, 20 and September 1, 20_ 10_ March 1, 20_and any Interest Payment Date thereafter 100 B. Mandatory Redemption from the Prepayment of Special Taxes. The Bonds shall be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20 103% March 1, 20 and September 1, 20 102 March 1, 20 and September 1, 20 101 March 1, 20_and on any Interest Payment Date thereafter 100 C. Purchase In Lieu of Redemption. In lieu of redemption under Section 2.03A or 2.03B, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including 60285.00019\7761646.3 11 P53O brokerage and other charges) as such Officer's Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the Bonds. D. Notice to Fiscal Agent. The District shall give the Fiscal Agent written notice of its intention to redeem Bonds pursuant to Section 2.03A or 2.03B not less than sixty (60) days prior to the applicable redemption date, unless such notice shall be waived by the Fiscal Agent, unless the Fiscal Agent agrees to a shorter period. E. Redemption Procedure by Fiscal Agent. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption, to the respective registered Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds. Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the Bond numbers of the Bonds to be redeemed by giving the individual Bond number of each Bond to be redeemed or shall state that all Bonds between two stated Bond numbers, both inclusive, are to be redeemed or that all of the Bonds of one or more maturities have been called for redemption, shall state as to any Bond called in part the principal amount thereof to be redeemed, and shall require that such Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such Bonds will not accrue from and after the redemption date. The cost of mailing any such redemption notice and any expenses incurred by the Fiscal Agent in connection therewith shall be paid by the District. Upon the payment of the redemption price of Bonds being redeemed, each check or other transfer of funds issued for such purpose shall, to the extent practicable, bear the Bond number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. The District shall have the right to rescind any notice of redemption for any optional or mandatory redemption pursuant to Section 2.03(A) or Section 2.03(B) hereof, on or prior to the date fixed for redemption. Any notice of optional redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date so fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constitute an Event of Default hereunder. The Fiscal Agent shall have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent shall mail notice of such recession of redemption in the same manner as the original notice of redemption. 60285.00019\7761646.3 12 P531 If less than all the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $5,000 to be redeemed shall be in the principal amount of$5,000 or a multiple thereof, and, in selecting portions of such Bonds for redemption, the Fiscal Agent shall treat each such Bond as representing the number of Bonds of $5,000 denominations which is obtained by dividing the principal amount of such Bond to be redeemed in part by $5,000. Whenever provision is made in this Agreement for the redemption of less than all of the Bonds or any given portion thereof, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof not previously called for redemption, among maturities as specified by the District in a written certificate delivered to the Fiscal Agent, and by lot within a maturity in any manner which the District in its sole discretion shall deem appropriate and fair. In providing such certificate, the District shall provide for the redemption of Bonds such that the remaining Debt Service payable on the Bonds shall remain level as possible. Upon surrender of Bonds redeemed in part only, the District shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the District, a new Bond or Bonds, of the same Series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds. F. Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the Bonds so called for redemption shall have been deposited in the Bond Fund, such Bonds so called shall cease to be entitled to any benefit under this Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice. All Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and, upon written request of the District, issue a certificate of destruction thereof to the District. Section 2.04. Form of Bonds. The Bonds, the form of Fiscal Agent's certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution, and the Act. The Bonds of any other Series and the form of the certificate of authentication and assignment to appear thereon shall be in such form or forms as may be specified in the Supplemental Agreement creating such Series of Bonds. Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the District by the manual or facsimile signatures of the Mayor and City Clerk, who are in office on the date of adoption of this Agreement or at any time thereafter. The Bonds shall then be delivered to the Trustee for authentication. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the Owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the Owner. Any Bond may be signed and attested on behalf of the District by such persons as at the actual date of the execution of such Bond shall be the proper officers of the 60285.00019\7761646.3 13 P532 District although at the nominal date of such Bond any such person shall not have been such officer of the District. Only such Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, executed and dated by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Agreement, and such certificate of authentication of the Fiscal Agent shall be conclusive evidence that the Bonds registered hereunder have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Agreement. Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the District shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for like aggregate principal amount. No transfers of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Section 2.07. Exchange of Bonds. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange. No exchanges of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or (iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Section 2.08. Bond Register. The Fiscal Agent will keep or cause to be kept, at its Principal Office sufficient books for the registration and transfer of the Bonds which books shall show the number, date, amount, rate of interest and last known Owner of each Bond and shall at all times be open to inspection by the District or the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the Bonds as hereinbefore provided. 60285.00019\7761646.3 14 P533 The District and the Fiscal Agent will treat the Owner of any Bond whose name appears on the Bond register as the absolute Owner of such Bond for any and all purposes, and the District and the Fiscal Agent shall not be affected by any notice to the contrary. The District and the Fiscal Agent may rely on the address of the Bond Owner as it appears in the Bond register for any and all purposes. Section 2.09. Temporary Bonds. The Bonds may be initially issued in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such authorized denominations as may be determined by the District, and may contain such reference to any of the provisions of this Agreement as may be appropriate. Every temporary Bond shall be executed by the District upon the same conditions and in substantially the same manner as the definitive Bonds. If the District issues temporary Bonds it will execute and furnish definitive Bonds without delay and thereupon the temporary Bonds shall be surrendered, for cancellation, in exchange for the definitive Bonds at the Principal Office of the Fiscal Agent or at such other location as the Fiscal Agent shall designate, and the Fiscal Agent shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary bonds shall be entitled to the same benefits under this Agreement as definitive Bonds authenticated and delivered hereunder. Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the District, at the expense of the Owner of said Bond, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and destroyed by the Fiscal Agent, who shall deliver a certificate of destruction thereof to the District. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the District and the Fiscal Agent satisfactory to the Fiscal Agent shall be given, the District, at the expense of the Owner, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The District may require payment of a sum not exceeding the actual cost of preparing each new Bond delivered under this Section and of the expenses which may be incurred by the District and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the District whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement. Section 2.11. Type and Nature of the Bonds; Limited Obligation. Neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision thereof other than the District is pledged to the payment of the Bonds. Except for the Special Taxes, no other taxes are pledged to the payment of the Bonds. The Bonds are not general or special obligations of the City nor general obligations of the District but are limited obligations of the District payable solely from Net Special Tax Revenues. The District's limited obligation to pay the principal of, premium, if any, and interest on the Bonds from the Net Special Tax 60285.00019\7761646.3 15 P534 Revenues is absolute and unconditional, free of deductions and without any abatement, offset, recoupment, diminution or set-off whatsoever. No Owner of the Bonds may compel the exercise of the taxing power by the District (except as it pertains to the Special Taxes) or the City or the forfeiture of any of their property. The principal of and interest on the Bonds and premiums upon the redemption thereof, if any, are not a debt of the City, the State of California or any of its political subdivisions except the District within the meaning of any constitutional or statutory limitation or restriction. The Bonds are not a legal or equitable pledge, charge, lien, or encumbrance upon any of the District's property, or upon any of its income, receipts or revenues, except the Net Special Tax Revenues and amounts on deposit in the Special Tax Fund and the Bond Fund to the extent pledged hereunder which are, under the terms of this Agreement and the Act, set aside for the payment of the Bonds and interest thereon and neither the members of the legislative body of the District nor any persons executing the Bonds are liable personally on the Bonds by reason of their issuance. Section 2.12. Equality of Bonds and Pledge of Net Special Tax Revenues. Pursuant to the Act and this Agreement, the Bonds shall be equally payable from the Net Special Tax Revenues and other amounts in the Special Tax Fund without priority for number, date of the Bonds, date of sale, date of execution, or date of delivery, and the payment of the interest on and principal of the Bonds and any premiums upon the redemption thereof, shall be exclusively paid from the Net Special Tax Revenues and other certain other amounts in the Special Tax Fund, which are hereby set aside for the payment of the Bonds. Amounts in the Special Tax Fund shall constitute a trust fund held for the benefit of the Owners to be applied to the payment of the interest on and principal of the Bonds and so long as any of the Bonds or interest thereon remain Outstanding shall not be used for any other purpose, except as permitted by this Agreement. Nothing in this Fiscal Agent Agreement shall preclude, subject to the limitations contained hereunder, the redemption prior to maturity of any Bonds subject to call and redemption and payment of said Bonds from proceeds of refunding bonds issued under the Act as the same now exists or as hereafter amended, or under any other law of the State of California, which shall be payable from Net Special Tax Revenues. Section 2.13. Description of Bonds; Interest Rates. The Bonds and any Parity Bonds shall be issued in fully registered form in any denomination. The Bonds and any Parity Bonds of each issue shall be numbered as desired by the Fiscal Agent. Section 2.14. No Acceleration. The principal of the Bonds shall not be subject to acceleration hereunder. Nothing in this Section shall in any way prohibit the prepayment or redemption of Bonds under Section 2.03 hereof, or the defeasance of the Bonds and discharge of this Agreement under Section 10.01 hereof. Section 2.15. Additional Bonds. Other than for the purpose of refunding the Bonds, no additional Bonds entitled to a lien on the Net Special Tax Revenues shall be issued hereunder. 60285.00019\7761646.3 16 P535 Section 2.16. Validity of the Bonds. The validity of the authorization and issuance of the Bonds shall not be affected in any way by any defect in any proceedings taken by the District for the issuance and sale of the Bonds and the recital contained in the Bonds that the same are issued pursuant to the Act and other applicable laws of the State shall be conclusive evidence of their validity and the regularity of their issuance. Section 2.17. Book-Entry. The Bonds shall be initially issued in the form of a single, fully registered Bond for each maturity (which may be typewritten). Upon initial issuance, the ownership of such Bonds shall be registered in the name of the Nominee identified below as nominee of The Depository Trust Company, New York, New York and its successors and assigns (the "Depository" or "DTC"). Except as hereinafter provided, all of the Outstanding Bonds shall be registered in the name of the nominee of the Depository, which may be the Depository, as determined from time to time pursuant to this Section 2.17 (the "Nominee"). With respect to the Bonds registered in the name of the Nominee, neither the District nor the Fiscal Agent shall have any responsibility or obligation to any broker-dealers, banks and other financial institutions from time to time for which the Depository holds Bonds as securities depository (the "Participant") or to any person on behalf of which such a Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, neither the District nor the Fiscal Agent shall have any responsibility, liability or obligation whatsoever with respect to (i) the accuracy of the records of the Depository, the Nominee, or any Participant with respect to any ownership interest in the Bonds; (ii) the delivery to any Participant or any other person, other than an Owner of a Bond as shown in the registration books maintained by the Fiscal Agent pursuant to Section 2.08 hereof(the "Registration Books"), of any notice with respect to the Bonds, including any notice of redemption; (iii) the selection by the Depository and its Participants of the beneficial interests in the Bonds to be redeemed in the event the District redeems the Bonds in part; or (iv) the payment to any Participant or any other person, other than an Owner of a Bond as shown in the Registration Books, of any amount with respect to principal of or interest on the Bonds. The District and the Fiscal Agent may treat and consider conclusively the person in whose name each Bond is registered as the holder and absolute Owner of such Bond for the purpose of payment of principal and interest with respect to such Bond, for the purpose of giving notices of redemption, if applicable, and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The District shall pay all principal of and interest on the Bonds only to or upon the order of the respective Owner of a Bond, as shown in the Registration Books, or his or her attorney duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the District's obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner of a Bond, as shown in the Registration Books, shall receive a Bond evidencing the obligation of the District to make payments of principal and interest pursuant to this Agreement. Upon delivery by the Depository to the Owners of the Bond, and the District of written notice to the effect that the Depository has determined to substitute a new nominee in place of the Nominee, and subject to the provisions herein with respect to Record Dates, the word Nominee in this Agreement shall refer to such nominee of the Depository. 60285.00019\7761646.3 17 P536 In the event (i) the Depository determines not to continue to act as securities depository for the Bonds, or(ii) the Depository shall no longer so act and gives notice to the District of such determination, then the District will discontinue the book-entry system with the Depository. If the District determines to replace the Depository with another qualified securities depository, the District shall prepare or direct the preparation of a new, single, separate, fully registered Bond, per maturity, registered in the name of such successor or substitute qualified securities depository or its nominee. If the District fails to identify another qualified securities depository to replace the Depository, then the Bonds shall no longer be restricted to being registered in the Registration Books in the name of the Nominee, but shall be registered in whatever name or names Owners of the Bonds transferring or exchanging Bonds shall designate, in accordance with the provisions of Sections 2.06 and 2.07 hereof, and the District shall prepare and deliver Bonds to the Fiscal Agent for authentication and delivery to the Owners thereof for such purpose. In the event of a reduction in aggregate principal amount of Bonds Outstanding or an advance refunding of part of the Bonds Outstanding, the Depository, in its discretion, (i) may request the District to prepare and issue a new Bond or (ii) may make an appropriate notation on a Bond indicating the date and amounts of such reduction in principal, but in such event the Registration Books maintained by the Fiscal Agent shall be conclusive as to what amounts are Outstanding with respect to the Bond, except in the case of final maturity, in which case the Bond must be presented to the Fiscal Agent prior to payment. Notwithstanding any other provision of this Agreement to the contrary, so long as any Bond is registered in the name of the Nominee, all payments of principal and interest with respect to such Bond and all notices with respect to such Bond shall be made and given, respectively, as provided in the Representation Letter or as otherwise instructed by the Depository and acceptable to the District. The initial Nominee shall be Cede & Co., as Nominee of DTC ARTICLE III ISSUANCE OF BONDS Section 3.01. Issuance and Delivery of the Bonds. At any time after the execution of this Agreement, the District may issue the Bonds in the aggregate principal amount set forth in Section 2.01 and deliver the Bonds to the Original Purchaser. The Authorized Officers of the District are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of the Bonds in accordance with the provisions of the Act, the Resolution of Issuance and this Agreement and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser, upon payment of the purchase price for the Bonds. 60285.00019\7761646.3 18 P537 Section 3.02. Application of Proceeds of Sale of the Bonds and Transfers from the Prior Special Tax Bonds. The proceeds of the purchase of the Bonds by the Original Purchaser (being $ equal to the par amount of$ minus the purchaser's discount of $ ) shall be paid to the Fiscal Agent, who shall forthwith set aside, pay over and transfer such proceeds on the Closing Date as follows: A. $ shall be transferred to the Escrow Agent for deposit into the Escrow Fund held by the Escrow Agent under the Escrow Agreement; B. $ shall be deposited into the Reserve Fund, the Reserve Requirement as of the Closing Date; and C. $ shall be deposited in the Costs of Issuance Fund. Section 3.03. Special Tax Fund. A. Establishment of Special Tax Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the "Special Tax Fund," to the credit of which the District or the City, on behalf of the District, shall deposit, immediately upon receipt, all Special Tax Revenue received by the District or the City, on behalf of the District. Moneys in the Special Tax Fund, other than Penalties and Interest, shall be held by the Fiscal Agent for the benefit of the District and the Owners of the Bonds, shall be disbursed as provided below and, pending any disbursement, shall be subject to a lien in favor of the Owners of the Bonds. B. Disbursements of Special Tax Revenues. The Special Tax Revenues deposited in the Special Tax Fund shall be held and, other than Special Tax Revenues representing Prepayments, subsequently transferred to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 1. to the District for deposit in Administrative Expense Fund an amount equal to the Priority Administrative Expense Amount estimated to be due and payable during the Fiscal Year; 2. not later than ten (10) Business Days prior to each Interest Payment Date, to the Bond Fund: a. the amount representing past due installments of principal, interest and premium on the Bonds (including any interest thereon pursuant to the second sentence of the second paragraph of Section 4.02B), if any, resulting from the delinquency in the payment of such Special Taxes; and b. an amount, taking into account any amounts then on deposit in the Bond Fund (other than by reason of the preceding paragraph a.) such that the amount in the Bond Fund equals the principal, premium, if any, and interest due on the Bonds on the next Interest Payment Date; 60285.00019\7761646.3 19 P538 3. no later than ten (10) Business Days prior to each Interest Payment Date, to the Reserve Fund that amount, in addition to the amount transferred to the Bond Fund pursuant to paragraph 2. above, necessary to replenish any draw on the Reserve Fund; 4. on September 2 of each year after making the deposits and transfers required under paragraphs 1 and 2 above and the transfer, if any, authorized under paragraph 3 above, to the Rebate Fund, upon receipt of written instructions from an Authorized Officer on or before the preceding June 30, the amount specified in such written instructions necessary for the payment of any rebate amount due and owing to the United States of America by the District on the Bonds; 5. on September 2 of each year after making the deposits and transfers required under paragraphs 1 through 4 above, upon receipt of written instructions from an Authorized Officer, to the District for deposit in the Administrative Expense Fund the amount specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or the establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund and not included in any prior transfer made pursuant to paragraph I and 4 above; and 6. after September 2 of each year, after making the deposits and transfers made pursuant to paragraphs 1 through 5 above, moneys then on deposit in the Special Tax Fund shall remain therein and shall be subsequently deposited or transferred pursuant to the provisions of paragraphs 1 through 5 above. C. Transfer of Prepayments. Amounts constituting Prepayments shall be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Bond Fund designated as "Prepayment Account" and used to redeem Bonds pursuant to paragraph 2 of Section 2.03B. Any such transfer of Prepayments shall be accompanied by written instructions executed by the Treasurer or an Authorized Officer directing the Fiscal Agent to place such Prepayments in the Prepayment Account. D. Penalties and Interest. Amounts constituting Penalties and Interest shall be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Special Tax Fund designated as "Penalties and Interest Account." The moneys on deposit in the Penalties and Interest Account shall be held and subsequently transferred, upon receipt of written instructions contained in an Officer's Certificate, to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 1. to the Administrative Expense Fund that amount as specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund not included in any prior transfer made pursuant to paragraphs 3 or 6 of subsection B above; 60255.00019\7761646.3 20 P539 2. to the Bond Fund that amount as specified in such Officer's Certificate for the payment of debt service on the Bonds; 3. to the Reserve Fund that amount as specified in such Officer's Certificate as necessary to increase the balance therein up to the Reserve Requirement; or 4. to such other fund or account as specified in such Officer's Certificate for any authorized purpose of the District. E. Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof. Section 3.04. Costs of Issuance Fund. A. Establishment of Costs of Issuance Fund. There is hereby established, as a separate account to be held by the Fiscal Agent, the "Costs of Issuance Fund" to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection B of this Section for the payment or reimbursement of Costs of Issuance. B. Disbursement. Amounts in the Costs of Issuance Fund shall be disbursed to pay Costs of Issuance, as set forth in a requisition containing respective amounts to be paid to the designated payees, signed by an Authorized Officer and delivered to the Fiscal Agent on the Closing Date. The Fiscal Agent shall pay all Costs of Issuance upon receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee in such requisition, or upon receipt of an Officer's Certificate requesting payment of a Cost of Issuance not listed on the initial requisition delivered to the Fiscal Agent on the Closing Date. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of ninety (90) days from the Closing Date and shall then transfer and deposit any moneys remaining therein, including any Investment Earnings thereon, to the Special Tax Fund. C. Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01 hereof. Investment Earnings shall be retained by the Fiscal Agent in the Cost of Issuance Fund to be used for the purposes of such fund. Section 3.05. Administrative Expense Fund. A. Establishment of Administrative Expense Fund. There is hereby established, as a separate account to be held by the District, the "Administrative Expense Fund" to the credit of which transfers from the Fiscal Agent shall be made to the District as required by Sections 3.02D, 3.03B or 3.03D hereof. Moneys in the Administrative Expense Fund shall be held in trust by the District for the benefit of the City and the District, and shall be disbursed as provided below. 60285.0001%7761646.3 21 P540 B. Disbursement. Amounts in the Administrative Expense Fund shall be withdrawn by the District and paid to the payee specified in an Officer's Certificate stating the amount to be withdrawn, that such amount is to be used to pay an Administrative Expense and the nature of such expense. Amounts on deposit in the Administrative Expense Fund at the end of any Fiscal Year shall be retained in such fund as an operating reserve and shall be disbursed as provided for in this paragraph B. C. Investment. Moneys in the Administrative Expense Fund shall be invested and deposited in accordance with Section 6.01 hereof. Investment Earnings shall be retained by the District in the Administrative Expense Fund to be used for the purposes of such fund. ARTICLE IV NET SPECIAL TAX REVENUES; BOND FUND Section 4.01. Pledge of Net Special Tax Revenues. The Bonds shall be secured by a first pledge (which pledge shall be effected in the manner and to the extent herein provided) of all of the Net Special Tax Revenues and all moneys deposited in the Bond Fund and, until disbursed as provided herein, in the Special Tax Fund, except for moneys on deposit in the the Penalties and Interest Account. The Bonds are further secured by a first pledge of all moneys deposited in the Reserve Fund. The Net Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided herein) are hereby dedicated to the payment of the principal of, and interest and any premium on, the Bonds as provided herein and in the Act until all of the Bonds have been paid and retired or until moneys or Defeasance Obligations have been set aside irrevocably for that purpose in accordance with Section 10.01. Section 4.02. Bond Fund. A. Establishment of Bond Fund. There is hereby established as a separate fund to be held by the Fiscal Agent for the "Bond Fund" and, within the Bond Fund, the "Prepayment Account" to the credit of which deposits shall be made as required by paragraph 2 of Section 3.03B. and by Section 3.03C., and any other amounts required to be deposited therein by this Agreement or the Act. Moneys in the Bond Fund shall be held by the Fiscal Agent for the benefit of the Owners of the Bonds, shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds. B. Disbursements. On each Interest Payment Date, the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal of, and interest and any premium, then due and payable on the Bonds, including any amounts due under Section 2.03A. hereof; provided, however, that available amounts in the Bond Fund shall first be used to pay to the Owners of the Bonds any past due installments of interest, principal (including mandatory sinking payments) of and premium, if any, on the Bonds, in that order. Amounts transferred to the Bond Fund from the Special Tax Fund pursuant to paragraph 2.a. of Section 3.03B. shall immediately be paid to the Owners of the Bonds in respect of past due payments on the Bonds, and amounts transferred to the Prepayment Account pursuant to Section 3.03C. shall be used to redeem Bonds pursuant to Section 2.03B. 60255.00019\7761646.3 22 P541 If after the foregoing transfers, there are insufficient funds in the Bond Fund to make the payments provided for in the first sentence of this Section 4.02B., the Fiscal Agent shall apply the available funds first to the payment of interest on the Bonds, then to the payment of principal and any mandatory sinking payments due on the Bonds. Any installment of principal (including mandatory sinking payments), premium, if any, or interest on the Bonds which is not paid when due shall accrue interest at the rate of interest on the Bonds until paid, and shall be paid whenever funds in the Bond Fund are sufficient therefor. If at any time the Fiscal Agent fails to pay principal and interest due on any scheduled payment date for the Bonds, the Fiscal Agent shall notify the District and the Treasurer in writing of such failure, and the Treasurer shall notify the California Debt Advisory Commission of such failure within 10 days of the failure to make such payment, as required by Section 53359(c)(1) of the Act. C. Investment. Moneys in the Bond Fund shall be invested and deposited in accordance with Section 6.01. Investment Earnings shall be retained in the Bond Fund, except to the extent they are required to be deposited by the Fiscal Agent in the Rebate Fund in accordance with Section 6.02 hereof. Interest earnings and profits resulting from the investment and deposit of amounts in the Bond Fund shall be retained in the Bond Fund. Section 4.03. Reserve Fund. A. Establishment of Reserve Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the "Reserve Fund," to the credit of which a deposit shall be made as required by Section 3,02B. hereof. Moneys in the Reserve Fund shall be held by the Fiscal Agent for the benefit of the Bondowners and shall be disbursed as provided in Section 4.03B below. B. Procedure for Disbursement. Moneys on deposit in the Reserve Fund shall be used solely for the purpose of paying the principal of and interest on the Bonds as such amounts shall become due and payable in the event that the moneys in the Special Tax Fund and the Bond Fund for such purpose are insufficient therefor or redeeming Bonds as described below. The Fiscal Agent shall, when and to the extent necessary, withdraw money from the Reserve Fund and transfer such money to the Bond Fund or the Redemption Fund for such purpose. On any date after either the transfers, if any, required by the preceding paragraph have been made for any Bond Year or the valuation of the Permitted Investments in the Reserve Fund pursuant to Section 6.01 below, if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, the Fiscal Agent shall transfer to the Reserve Fund from the first available moneys in the Special Tax Fund an amount necessary to increase the balance therein to the Reserve Requirement. If at least ten (10) Business Days prior to each Interest Payment Date of each year, the amount on deposit in the Reserve Fund, less Investment Earnings resulting from the investment of the funds therein which pursuant to Section 6.02 hereof must be rebated to the United States, is in excess of the Reserve Requirement, the Fiscal Agent shall transfer such excess to the Bond Fund. In connection with any optional redemption of Bonds pursuant to Section 2.03A., amounts on deposit in the Reserve Fund which would be in excess of the Reserve Requirement following such redemption shall be transferred to the Redemption Fund or 60285.00019\7761646.3 23 P542 the Bond Fund, as applicable, prior to such redemption and applied to such redemption of Bonds pursuant to written instructions of the District contained in an Officer's Correspondence. Upon receipt of an Officer's Correspondence instructing the Fiscal Agent to transfer certain moneys representing a Reserve Fund credit for a Prepayment pursuant to the RMA , the Fiscal Agent shall transfer the amount specified in such instructions from the Reserve Fund to the Redemption Fund for the purpose of redeeming Bonds pursuant to such instructions. Whenever the balance in the Reserve Fund and the Bond Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent shall transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding Interest Payment Date, to the payment and redemption, in accordance with Section 2.03A of all of the Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund shall be transferred to the District to be used for any lawful purpose of the District as set forth in the Act. C. Investment. Moneys in the Reserve Fund shall be invested and deposited by the Fiscal Agent in accordance with Section 6.01 hereof. Interest earnings and profits from such investment and deposit shall be retained in the Reserve Fund to be used for the purposes of such fund. All Authorized Investments in the Reserve Fund shall be valued at their cost at least semi- annually on February 1 and August 1 so long as at lease 25% of the moneys in the Reserve Fund are invested for a period not to exceed two (2) years in length. ARTICLE V OTHER COVENANTS OF THE DISTRICT Section 5.01. Warranty. The District shall preserve and protect the security pledged hereunder to the Bonds against all claims and demands of all persons. Section 5.02. Covenants. So long as any of the Bonds issued hereunder are Outstanding and unpaid, the District makes the covenants set forth herein below in this Article V with the Bondowners under the provisions of the Act and this Fiscal Agent Agreement (to be performed by the District or the City, acting for and on behalf of the District, or its proper officers, agents and employees), which are covenants necessary and desirable to secure the Bonds and tend to make the Bonds more marketable; provided, however, that such covenants do not require the District to expend any funds or moneys other than the Net Special Tax Revenues. Section 5.03. Punctual Payment. The District shall punctually pay or cause to be paid the principal of, and interest and any premium on, the Bonds when and as due in strict conformity with the terms of this Agreement and any Supplemental Agreement, and it will faithfully observe and perform all of the conditions, covenants and requirements of this Agreement and all Supplemental Agreements and of the Bonds. 60285.00019\7761646.3 24 P543 Section 5.04. Limited Obligation. The Bonds are limited obligations of the District and are payable solely from and secured solely by the Net Special Tax Revenues and the amounts in the Bond Fund and the Special Tax Fund created hereunder. Section 5.05. Payment of Claims. The District will pay and discharge any and all lawful claims for labor, materials, or supplies which, if unpaid, might become a lien or charge upon the Special Tax Revenues or which might otherwise impair the security of the Bonds then Outstanding; provided that nothing herein contained shall require the District to make any such payments so long as the District in good faith shall contest the validity of any such claims. Section 5.06. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the District shall not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and shall not, directly or indirectly, be a party to the approval of any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the District, such claim for interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits of this Agreement, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have so extended or funded. Section 5.07. Against Encumbrances. The District will not encumber, pledge or place any charge or lien upon any of the Net Special Tax Revenues or other amounts pledged to the Bonds superior to or on a parity with the pledge and lien herein created for the benefit of the Bonds, except as permitted by this Agreement. Section 5.08. Books and Records. The District will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the District, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Bond Fund and the Special Tax Fund and relating to the Special Tax Revenues. Section 5.09. Protection of Security and Rights of Owners. The District will preserve and protect the security of the Bonds and the rights of the Owners, and will warrant and defend their rights against all claims and demands of all persons. From and after the delivery of any of the Bonds by the District, the Bonds shall be incontestable by the District. Section 5.10. Collection of Special Tax Revenues. The District shall comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including without limitation, the enforcement of delinquent Special Taxes. On or about July 10 of each year, the Treasurer shall communicate with the Auditor to ascertain the relevant parcels on which the Special Taxes are to be levied, taking into account any parcel splits during the preceding and then current year. 60285.00019\7761646.3 25 P544 The Treasurer shall effect the levy of the Special Taxes each Fiscal Year on the parcels within Improvement Area No. 1 of the District in accordance with the Ordinance, such that the computation of the levy is complete before the final date on which the Auditor will accept the transmission of the Special Tax amounts for the parcels within Improvement Area No. 1 of the District for inclusion on the next secured tax roll. Upon the completion of the computation of the amounts of the levy, the Treasurer shall prepare or cause to be prepared, and shall transmit to the Auditor, such data as the Auditor requires to include the levy of the Special Taxes on the next secured tax roll. The Special Taxes so levied shall be payable and be collected in the same manner and at the same time and in the same installments as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the general taxes on real property, unless otherwise provided by the District. In the event that the Treasurer determines to levy all or a portion of the Special Taxes by means of direct billing of the property owners of the parcels within Improvement Area No. 1 of the District, the Treasurer shall, not less than forty-five (45) days prior to each Interest Payment Date, send bills to the owners of such real property located within Improvement Area No. 1 of the District subject to the levy of the Special Taxes for Special Taxes in an aggregate amount necessary to meet the financial obligations of the District with respect to the District due on the next Interest Payment Date, said bills to specify that the amounts so levied shall be due and payable not less than thirty (30) days prior to such Interest Payment Date and shall be delinquent if not paid when due. In any event, the Treasurer shall fix and levy the amount of Special Taxes within Improvement Area No. 1 of the District required for the payment of principal of and interest on any Outstanding Bonds becoming due and payable during the ensuing year, an amount necessary to replenish the Reserve Fund pursuant to Section 3.03B.3. and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the RMA and the Ordinance. The Special Taxes so levied shall not exceed the authorized amounts as provided in the proceedings pursuant to the Resolution of Formation. The Treasurer is hereby authorized to employ consultants to assist in computing the levy of the Special Taxes hereunder and any reconciliation of amounts levied to amounts received. The fees and expenses of such consultants and the costs and expenses of the Treasurer (including a charge for City or District staff time) in conducting its duties hereunder shall be an Administrative Expense hereunder. Section 5.11. Further Assurances. The District shall adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement. Section 5.12. Tax Covenants. The District covenants that: 60285.00019\7761646.3 26 P545 A.. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of the initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "arbitrage bonds" within the meaning of Section 103(b) and Section 148 of the Code; B. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would result in loss of exclusion from gross income for purposes of federal income taxation under Section 103(a) of the Code of interest paid with respect to the Bonds; C. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "private activity bonds" within the meaning of Section 141 of the Code; D. It will comply with the Rebate Certificate as a source of guidance for achieving compliance with the Code; and E. In order to maintain the exclusion from gross income for purposes of federal income taxation of interest paid with respect to the Bonds, it will comply with each applicable requirement of Section 103 and Sections 141 through 150 of the Code. The covenants of the District contained in this Section 5.12 shall survive the payment, redemption or defeasance of Bonds pursuant to Section 10.01 hereof. Section 5.13. Covenant to Foreclose. On or before March 1 and June 1 of each Fiscal year, the District will review the public records of the County in connection with the Special Taxes levied in such Fiscal Year to determine the amount of Special Taxes actually collected in such Fiscal Year. If the District determines that any parcel subject to the Special Taxes is delinquent in the payment of two or more installments of Special Taxes, the City shall, not later than forty-five (45) days of such determination, send or cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner. The City shall cause judicial foreclosure proceedings to be commenced and filed in the Superior Court not later than ninety (90) days of such determination against any parcel for which a notice of delinquency was given pursuant to this section and for which the Special Taxes remain delinquent. The City Attorney is hereby authorized to employ counsel to conduct any such foreclosure proceedings. The fees and expenses of any such counsel and costs and expenses of the City Attorney (including a charge for City or District staff time) in conducting foreclosure proceedings shall be an Administrative Expense hereunder. Notwithstanding any provision of the Act or other law of the State to the contrary, in connection with any foreclosure related to delinquent Special Taxes: 60285.00019\7761646.3 27 P546 A. The City, or the Fiscal Agent, is hereby expressly authorized to credit bid at any foreclosure sale, without any requirement that funds be placed in the Bond Fund or otherwise be set aside in the amount of such credit bid, in the amount specified in Section 53356.5 of the Act or such lesser amount as determined under B. below or otherwise under Section 53356.6 of the Act. B. The City may permit property with delinquent Special Tax payments to be sold for less than the amount specified in Section 53356.5 of the Act, if it determines that such sale is in the interest of the Bond Owners. The Bond Owners, by their acceptance of the Bonds, hereby consent to such sale for such lesser amounts (as such consent is described in Section 53356.6 of the Act), and hereby release the City, its officers and its agents from any liability in connection therewith. C. The City is hereby expressly authorized to use amounts in the Administrative Expense Fund to pay costs of foreclosure of delinquent Special Taxes. D. The City may forgive all or any portion of the Special Taxes levied or to be levied on any parcel in the District, so long as the City determines that such forgiveness is not expected to adversely affect its obligation to pay principal of and interest on the Bonds. Section 5.14. Annual Reports to CDIAC. Not later than October 30 of each year, commencing October 30, 2013, and until the October 30 following the final maturity of the Bonds, the Treasurer shall supply the information required by Section 53359.5(b) or (c) of the Act to CDIAC (on such forms as CDIAC may specify) and the District. Section 5.15. Continuing Disclosure to Owners. The District acknowledges that the City has executed and delivered a Continuing Disclosure Certificate, for and on behalf of the the District, for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Underwriter in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission. The District hereby covenants and agrees that it will cause all of its obligations under the Continuing Disclosure Certificate to be carried out. Notwithstanding any other provision of this Agreement, failure of the District to comply with the Continuing Disclosure Agreement shall not be considered a default hereunder; however, the Underwriter or any holder or beneficial owner of 25% of the Bonds may take such actions as may be necessary and appropriate to compel performance by the District of its obligations under this Section 5.15, including seeking mandate or specific performance by court order. Section 5.16. Public Access to Facilities. The City and the District shall provide or cause to be provided access to members of the general public to all portions of the Project financed with the proceeds of the Prior Special Tax Bonds. Said access shall not grant priority to any one person over that of another person. Section 5.17. Modification of Maximum Authorized Special Tax. The District, to the maximum extent that the law permits it to do so, covenants that no modification of the minimum or maximum authorized Special Tax shall be approved by the District nor shall the District take any other action which would (i) prohibit the District from levying the Special Tax within Improvement Area No. 1 of the District in any Fiscal Year at such a rate as would generate Net 60285.0001%7761646.3 28 P547 Special Tax Revenues in such Fiscal Year at least equal to 110% of Annual Debt Service on all Bonds then Outstanding; (ii) discontinue or cause the discontinuance of such levy; or (iii) permit the prepayment of the Special Tax except as permitted pursuant to the the RMA. Section 5.18. Covenant to Defend. The District covenants, in the event that any initiative is adopted by the qualified electors in the District which purports to reduce the minimum or the maximum Special Tax below the levels specified in Section 5.17 above or to limit the power of the District to levy the Special Taxes within Improvement Area No. I of the District for the purposes set forth in Section 5.10 above, it will commence and pursue legal action in order to preserve its ability to comply with such covenants. ARTICLE VI INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE DISTRICT Section 6.01. Deposit and Investment of Moneys in Funds. Moneys in any fund or account created or established by this Agreement and held by the Fiscal Agent shall be invested by the Fiscal Agent in Permitted Investments, as directed pursuant to an Officer's Certificate filed with the Fiscal Agent at least two (2) Business Days in advance of the making of such investments. In the absence of any such Officer's Certificate, the Fiscal Agent shall invest any such moneys in Permitted Investments described in clause B(5) of the definition thereof to the extent practicable which by their terms mature prior to the date on which such moneys are required to be paid out hereunder, or are held uninvested. The Treasurer shall make note of any investment of funds hereunder in excess of the yield on the Bonds, so that appropriate actions can be taken to assure compliance with Section 5.10. Moneys in any fund or account created or established by this Agreement and held by the Treasurer shall be invested by the Treasurer in Permitted Investments, which in any event by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an investment of moneys in any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of interest earnings and profits resulting from investment of amounts in funds and accounts. Whenever in this Agreement any moneys are required to be transferred by the District to the Fiscal Agent, such transfer may be accomplished by transferring a like amount of Permitted Investments. The Fiscal Agent or an affiliate or the Treasurer may act as principal or agent in the acquisition or disposition of any investment and shall be entitled to its customary fee therefor. Neither the Fiscal Agent nor the Treasurer shall incur any liability for losses arising from any investments made pursuant to this Section. For purposes of determining the amount on deposit in any fund or account held hereunder, all Permitted Investments or investments credited to such fund or account shall be valued at provided for in Exhibit B attached hereto. 60285.00019\7761646.3 29 P548 Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of section 148 of the Code) shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under the applicable provisions of the Code shall be valued at their present value (within the meaning of section 148 of the Code). The Fiscal Agent shall not be liable for verification of the application of such sections of the Code. Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of investments, notwithstanding provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amounts received or held by the Fiscal Agent or the Treasurer hereunder, provided that the Fiscal Agent or the Treasurer, as applicable, shall at all times account for such investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement. The Fiscal Agent or the Treasurer, as applicable, shall sell at the highest price reasonably obtainable, or present for redemption, any investment security whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such investment security is credited and neither the Fiscal Agent nor the Treasurer shall be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith. Section 6.02. Rebate Fund; Rebate to the United States. There is hereby created, to be held by the Fiscal Agent, as a separate fund distinct from all other funds and accounts held by the Fiscal Agent under this Agreement, the Rebate Fund. The Fiscal Agent shall, in accordance with written directions received from an Authorized Officer, deposit into the Rebate Fund moneys transferred by the District to the Fiscal Agent pursuant to the Rebate Certificate or moneys transferred by the Fiscal Agent from the Bond Fund or the Reserve Fund. The Rebate Fund shall be held either uninvested or invested only in Federal Securities at the written direction of the District. Moneys on deposit in the Rebate Fund shall be applied only to payments made to the United States, to the extent such payments are required by the Rebate Certificate. The Fiscal Agent shall, upon written request and direction of the District, make such payments to the United States. The Fiscal Agent's sole responsibilities under this Section 6.02 are to follow the written instructions of the District pertaining hereto. The District shall be responsible for any fees and expenses incurred by the Fiscal Agent pursuant to this Section 6.02. The Fiscal Agent shall, upon written request and direction from the District, transfer to or upon the order of the District any moneys on deposit in the Rebate Fund in excess of the amount, if any, required to be maintained or held therein in accordance with the Rebate Certificate. Section 6.03. Limited Obligation. The District's obligations hereunder are limited obligations of the District and are payable solely from and secured solely by the Net Special Tax Revenues and the amounts in the Special Tax Fund and the Bond Fund. 60285.00019\7761646.3 30 P549 Section 6.04. Liability of District. The District shall not incur any responsibility in respect of the Bonds or this Agreement other than in connection with the duties or obligations explicitly herein or in the Bonds assigned to or imposed upon it. The District shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The District shall not be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions, covenants, or agreements of the Fiscal Agent herein or of any of the documents executed by the Fiscal Agent in connection with the Bonds, or as to the existence of a default or event of default thereunder. In the absence of bad faith, the District, including the Treasurer, may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the District and conforming to the requirements of this Agreement. The District, including the Treasurer, shall not be liable for any error of judgment made in good faith unless it shall be proved that it was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the District to expend or risk its own general funds or otherwise incur any financial liability (other than with respect to the Net Special Tax Revenues) in the performance of any of its obligations hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. The District may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties. The District may consult with counsel, who may be the City Attorney, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The District shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed. Whenever in the administration of its duties under this Agreement the District shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the District, be deemed to be conclusively proved and established by a certificate of the Fiscal Agent, and such certificate shall be full warrant to the District for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the District may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. 60285.00019\7761646.3 31 P550 Section 6.05. Employment of Agents by District or the City. In order to perform their respective duties and obligations hereunder, the City, the District and/or the Treasurer may employ such persons or entities as they deem necessary or advisable. The City, the District, and/or the Treasurer shall not be liable for any of the acts or omissions of such persons or entities employed by them in good faith hereunder, and shall be entitled to rely, and shall be fully protected in doing so, upon the opinions, calculations, determinations and directions of such persons or entities. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS Section 7.01. Events of Default. The following events shall be Events of Default: A. Failure to pay any installment of principal of any Bonds when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption or otherwise. B. Failure to pay any installment of interest on any Bonds when and as the same shall become due and payable. C. Failure by the District to observe and perform any of the other covenants, agreements, or conditions on its part in this Agreement or in the Bonds contained, if such failure shall have continued for a period of 60 days after written notice thereof, specifying such failure and requiring the same to be remedied, shall have been given to the District by the Fiscal Agent or the Owners of not less than 25% in aggregate principal amount of the Bonds at the time Outstanding; provided, however, if in the reasonable opinion of the District the failure stated in the notice can be corrected, but not within such 60-day period, such failure shall not constitute an Event of Default if corrective action is instituted by the District within such 60-day period and the District shall thereafter diligently and in good faith cure such failure in a reasonable period of time. D. Commencement by the District of a voluntary case under Title I 1 of the United States Code or any substitute or successor statute. Section 7.02. Remedies of Bond Owners. Subject to the provisions of Section 7.07, any Bond Owner shall have the right, for the equal benefit and protection of all Bond Owners similarly situated: A. by mandamus, suit, action or proceeding, to compel the City and its officers, agents or employees to perform each and every term, provision and covenant contained in this Agreement and in the Bonds, and to require the carrying out of any or all such covenants and agreements of the City and the fulfillment of all duties imposed upon it by the Act; B. by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the Bond Owners' rights; or 60285.00019\7761646.3 32 P551 C. upon the happening of any Event of Default, by suit, action or proceeding in any court of competent jurisdiction, to require the City and its officers and employees to account as if it and they were the trustees of an express trust. Section 7.03. Application of Special Taxes and Other Funds After Default. If an Event of Default shall occur and be continuing, all Special Taxes, including any penalties, costs, fees and other charges accruing under the Act, and any other funds then held or thereafter received by the Fiscal Agent under any of the provisions of this Agreement shall be applied by the Fiscal Agent as follows and in the following order: A. To the payment of any expenses necessary in the opinion of the Fiscal Agent to protect the interests of the Owners of the Bonds and payment of reasonable fees, charges, and expenses of the Fiscal Agent (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Agreement; B. To the payment of the principal of and interest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Agreement, as follows: First: To the payment to the Persons entitled thereto of all installments of interest then due in the order of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full any installment or installments maturing on the same date, then to the payment thereof ratably, according to the amounts due thereon, to the Persons entitled thereto, without any discrimination or preference; and Second: To the payment to the Persons entitled thereto of the unpaid principal of any Bonds which shall have become due, whether at maturity or by call for redemption, with interest on the overdue principal at the rate borne by the respective Bonds on the date of maturity or redemption, and, if the amount available shall not be sufficient to pay in full all the Bonds, together with such interest, then to the payment thereof ratably, according to the amounts of principal due on such date to the Persons entitled thereto, without any discrimination or preference. C. Any remaining funds shall be transferred by the Fiscal Agent to the Bond Fund. Section 7.04. Absolute Obligation of the District. Nothing in Section 7.08 or in any other provision of this Agreement or in the Bonds contained shall affect or impair the obligation of the District, which is absolute and unconditional, to pay the principal of and interest on the Bonds to the respective Owners of the Bonds at their respective dates of maturity, or upon call for redemption, as herein provided, but only out of the Net Special Tax Revenues and other moneys herein pledged therefor and received by the District or the Fiscal Agent, or affect or impair the right of such Owners, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Bonds. 60285.00019\7761646.3 33 P552 Section 7.05. Termination of Proceedings. In case any proceedings taken by any one or more Bond Owners on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Bond Owners, then in every such case the District, and the Bond Owners, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers and duties of the City, and the Bond Owners shall continue as though no such proceedings had been taken. Section 7.06. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Fiscal Agent or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or otherwise. Section 7.07. No Waiver of Default. No delay or omission of any Owner of the Bonds to exercise any right or power arising upon the occurrence of any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Agreement to the Owners of the Bonds may be exercised from time to time and as often as may be deemed expedient. ARTICLE VIII THE FISCAL AGENT Section 8.01. Appointment of Fiscal Agent. Wells Fargo Bank, National Association, is hereby appointed Fiscal Agent and paying agent for the Bonds. The Fiscal Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Fiscal Agent. Any company into which the Fiscal Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Fiscal Agent may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under the following paragraph of this Section, shall be the successor to such Fiscal Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding. The District may remove the Fiscal Agent initially appointed, and any successor thereto, and may appoint a successor or successors thereto, but any such successor shall be a bank or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least Seventy-Five Million Dollars ($75,000,000), and subject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 8.01, combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. 60285.00019\7761646.3 34 P553 The Fiscal Agent may at any time resign by giving written notice to the District and by giving to the Owners notice by mail of such resignation. Upon receiving notice of such resignation, the District shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent shall become effective upon acceptance of appointment by the successor Fiscal Agent. If no appointment of a successor Fiscal Agent shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Fiscal Agent shall have given to the District written notice or after a vacancy in the office of the Fiscal Agent shall have occurred by reason of its inability to act, the Fiscal Agent or any Bondowner may apply to any court of competent jurisdiction to appoint a successor Fiscal Agent. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Fiscal Agent. If, by reason of the judgment of any court, the Fiscal Agent is rendered unable to perform its duties hereunder, all such duties and all of the rights and powers of the Fiscal Agent hereunder shall be assumed by and vest in the Treasurer of the City in trust for the benefit of the Owners. The District covenants for the direct benefit of the Owners that the Treasurer in such case shall be vested with all of the rights and powers of the Fiscal Agent hereunder, and shall assume all of the responsibilities and perform all of the duties of the Fiscal Agent hereunder, in trust for the benefit of the Owners of the Bonds. Section 8.02. Liability of Fiscal Agent. The recitals of facts, covenants, and agreements herein and in the Bonds contained shall be taken as statements, covenants, and agreements of the District, and the Fiscal Agent assumes no responsibility for the correctness of the same, nor makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, nor shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The Fiscal Agent assumes no responsibility or liability for any information, statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement. Except as provided above in this paragraph, the Fiscal Agent shall be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument. 60285.00019\7761646.3 35 P554 The Fiscal Agent shall not be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions, covenants, or agreements of the City or the District herein or of any of the documents executed by the City or the District in connection with the Bonds, or as to the existence of a default or event of default thereunder. The Fiscal Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Fiscal Agent was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the Fiscal Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement at the request or direction of any of the Owners pursuant to this Agreement unless such Owners shall have offered to the Fiscal Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction. The Fiscal Agent may become the Owner of the Bonds with the same rights it would have if it were not the Fiscal Agent. All indemnifications and releases from liability granted to the Fiscal Agent hereunder shall extend to the directors, officers, and employees of the Fiscal Agent. Section 8.03. Information. The Fiscal Agent shall provide to the District such information relating to the Bonds and the funds and accounts maintained by the Fiscal Agent hereunder as the District shall reasonably request, including, but not limited to, quarterly statements reporting funds held and transactions by the Fiscal Agent. Section 8.04. Notice to Fiscal Agent. The Fiscal Agent may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, Bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties. The Fiscal Agent may consult with counsel, who may be counsel to the City, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The Fiscal Agent shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed. 60285.00019\7761646.3 36 P555 Whenever in the administration of its duties under this Agreement the Fiscal Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Fiscal Agent, be deemed to be conclusively proved and established by a certificate of the District, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this'Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may deem reasonable. Section 8.05. Compensation, Indemnification. The District shall pay to the Fiscal Agent from time to time reasonable compensation for all services rendered as Fiscal Agent under this Agreement, and also all reasonable expenses, charges, counsel fees, and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The District further agrees, to the extent permitted by applicable law, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any liabilities which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or willful misconduct. The obligation of the District under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement, but any monetary obligation of the District arising under this Section shall be limited solely to amounts on deposit in the Administrative Expense Fund. ARTICLE IX MODIFICATION OR AMENDMENT OF THIS AGREEMENT Section 9.01. Amendments Permitted. This Agreement and the rights and obligations of the District and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Agreement pursuant to the affirmative vote at a meeting of the Owners, or with the written consent without a meeting, of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 9.04. No such modification or amendment shall (i) extend the maturity of any Bond or reduce the interest rate thereon, or otherwise alter or impair the obligation of the District to pay the principal of, and the interest and any premium on, any Bond, without the express consent of the Owner of such Bond; or (ii) permit the creation by the District of any pledge or lien upon the Special Taxes superior to or on a parity with the pledge and lien created for the benefit of the Bonds (except as otherwise permitted by the Act, the laws of the State of California or this Agreement), or reduce the percentage of Bonds required for the amendment hereof Any such amendment may not modify any of the rights or obligations of the Fiscal Agent without its written consent. This Agreement and the rights and obligations of the District and of the Owners may also be modified or amended at any time by a Supplemental Agreement, without the consent of any Owners, only to the extent permitted by law and only for any one or more of the following purposes: 60285.00019\7761646.3 37 P556 (i) to add to the covenants and agreements of the District in this Agreement contained, other covenants and agreements thereafter to be observed, or to limit or surrender any right or power herein reserved to or conferred upon the District; (ii) to make modifications not adversely affecting any Outstanding Bonds of the District in any material respect; (iii) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting, or supplementing any defective provision contained in this Agreement, or in regard to questions arising under this Agreement, as the District and the Fiscal Agent may deem necessary or desirable and not inconsistent with this Agreement, and which shall not adversely affect the rights of the Owners of the Bonds; (iv) to make such additions, deletions, or modifications as may be necessary or desirable to assure the exclusion from gross income for federal income tax purposes of interest on the Bonds. Section 9.02. Owners' Meetings. The District may at any time call a meeting of the Owners. In such event the District is authorized to fix the time and place of said meeting and to provide for the giving of notice thereof, and to fix and adopt rules and regulations for the conduct of said meeting. Section 9.03. Procedure for Amendment with Written Consent of Owners. The District and the Fiscal Agent may at any time adopt a Supplemental Agreement amending the provisions of the Bonds or of this Agreement or any Supplemental Agreement, to the extent that such amendment is permitted by Section 9.01, to take effect when and as provided in this Section. A copy of such Supplemental Agreement, together with a request to Owners for their consent thereto, shall be mailed by first class mail, by the Fiscal Agent to each Owner of Bonds Outstanding, but failure to mail copies of such Supplemental Agreement and request shall not affect the validity of the Supplemental Agreement when assented to as in this Section provided. Such Supplemental Agreement shall not become effective unless there shall be filed with the Fiscal Agent the written consent of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding (exclusive of Bonds disqualified as provided in Section 9.04 and a notice shall have been mailed as hereinafter in this Section provided. Each such consent shall be effective only if accompanied by proof of ownership of the Bonds for which such consent is given, which proof shall be such as is permitted by Section 11.04. Any such consent shall be binding upon the Owner of the Bonds giving such consent and on any subsequent Owner (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Fiscal Agent prior to the date when the notice hereinafter in this Section provided for has been mailed. After the Owners of the required percentage of Bonds shall have filed their consents to the Supplemental Agreement, the District shall mail a notice to the Owners in the manner hereinbefore provided in this Section for the mailing of the Supplemental Agreement, stating in substance that the Supplemental Agreement has been consented to by the Owners of the required 60285.00019\7761646.3 38 P557 percentage of Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of the Supplemental Agreement or consents thereto). Proof of the mailing of such notice shall be filed with the Fiscal Agent. A record, consisting of the papers required by this Section 9.03 to be filed with the Fiscal Agent, shall be proof of the matters therein stated until the contrary is proved. The Supplemental Agreement shall become effective upon the filing with the Fiscal Agent of the proof of mailing of such notice, and the Supplemental Agreement shall be deemed conclusively binding (except as otherwise hereinabove specifically provided in this Article) upon the District and the Owners of all Bonds at the expiration of sixty (60) days after such filing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such sixty-day period. Section 9.04. Disqualified Bonds. Bonds owned or held for the account of the City or the District, excepting any pension or retirement fund, shall not be deemed Outstanding for the purpose of any vote, consent or other action or any calculation of Outstanding Bonds provided for in this Article IX, and shall not be entitled to vote upon, consent to, or take any other action provided for in this Article IX. Section 9.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article IX, this Agreement shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the District and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such Supplemental Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes. Section 9.06. Endorsement or Replacement of Bonds Issued After Amendments. The District may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article IX shall bear a notation, by endorsement or otherwise, in form approved by the District, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the District may select and designate for that purpose, a suitable notation shall be made on such Bond. The District may determine that new Bonds, so modified as in the opinion of the District is necessary to conform to such Owners' action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds. Section 9.07. Amendatory Endorsement of Bonds. The provisions of this Article IX shall not prevent any Owner from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds. 60285.00019\7761646.3 39 P558 ARTICLE X DEFEASANCE Section 10.01. Defeasance. If the District shall pay or cause to be paid, or there shall otherwise be paid, to the Owner of an Outstanding Bond the interest due thereon and the principal thereof, at the times and in the manner stipulated in this Agreement, then the Owner of such Bond shall cease to be entitled to the pledge of Net Special Tax Revenues, and, other than as set forth below, all covenants, agreements and other obligations of the District to the Owner of such Bond under this Agreement shall thereupon cease, terminate and become void and be discharged and satisfied. In the event of a defeasance of all Outstanding Bonds pursuant to this Section, the Fiscal Agent shall execute and deliver to the District all such instruments as may be desirable to evidence such discharge and satisfaction, and the Fiscal Agent shall pay over or deliver to the District's general fund all money or securities held by it pursuant to this Agreement which are not required for the payment of the principal of, premium, if any, and interest due on such Bonds. Any Outstanding Bond shall be deemed to have been paid within the meaning expressed in the first paragraph of this Section if such Bond is paid in any one or more of the following ways: (i) by paying or causing to be paid the principal of, premium, if any, and interest on such Bond, as and when the same become due and payable; (ii) by depositing with the Fiscal Agent, in trust, at or before maturity, money which, together with the amounts then on deposit in the Special Tax Fund and available for such purpose, is fully sufficient to pay the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and payable; or (iii) by depositing with the Fiscal Agent or another escrow bank appointed by the District, in trust, direct, noncallable Defeasance Obligations, in which the District may lawfully invest its money, in such amount as an Independent Accountant shall determine will be sufficient, together with the interest to accrue thereon and moneys then on deposit in the Special Tax Fund and available for such purpose, together with the interest to accrue thereon, to pay and discharge the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and payable; then, at the election of the District, and notwithstanding that any Outstanding Bonds shall not have been surrendered for payment, all obligations of the District under this Agreement with respect to such Bond shall cease and terminate, except for the obligation of the Fiscal Agent to pay or cause to be paid to the Owners of any such Bond not so surrendered and paid, all sums due thereon. Notice of such election shall be filed with the Fiscal Agent not less than ten (10) days prior to the proposed defeasance date, or such shorter period of time as may be acceptable to the Fiscal Agent. In connection with a defeasance under (ii) or (iii) above, there shall be provided to the District a verification report from an Independent Accountant stating its opinion as to the sufficiency of the moneys or securities deposited with the Fiscal Agent or the escrow bank to pay and discharge the principal of, premium, if any, and interest on all Outstanding 60285.00019\7761646.3 40 P559 Bonds to be defeased in accordance with this Section, as and when the same shall become due and payable, and an opinion of Bond Counsel (which may rely upon the opinion of the certified public accountant) to the effect that the Bonds being defeased have been legally defeased in accordance with this Agreement. Upon a defeasance, the Fiscal Agent, upon request of the District, shall release the rights of the Owners of such Bonds which have been defeased under this Agreement and execute and deliver to the District all such instruments as may be desirable to evidence such release, discharge and satisfaction. In the case of a defeasance hereunder of all Outstanding Bonds, after payment of any amounts then owed to the Fiscal Agent, the Fiscal Agent shall pay over or deliver to the District any funds held by the Fiscal Agent at the time of a defeasance, which are not required for the purpose of paying and discharging the principal of or interest on the Bonds when due. The Fiscal Agent shall, at the written direction of the District, mail, first class, postage prepaid, a notice to the Bondowners whose Bonds have been defeased, in the form directed by the District, stating that the defeasance has occurred. ARTICLE XI MISCELLANEOUS Section 11.01. Benefits of Agreement Limited to Parties. Nothing in this Agreement, expressed or implied, is intended to give to any person other than the District, the City, the Fiscal Agent, and the Owners, any right, remedy, claim under or by reason of this Agreement. Any covenants, stipulations, promises, or agreements in this Agreement contained by and on behalf of the District shall be for the sole and exclusive benefit of the Owners and the Fiscal Agent. Section 11.02. Cancellation of Bonds. All Bonds surrendered to the Fiscal Agent for payment upon maturity or for redemption shall be upon payment therefor, and any Bond purchased by the District as authorized herein and delivered to the Fiscal Agent for such purpose shall be, cancelled forthwith and shall not be reissued. The Fiscal Agent shall destroy such Bonds, as provided by law, and, upon request of the District, furnish to the District a certificate of such destruction. Section 11.03. Successor is Deemed Included in All References to Predecessor. Whenever in this Agreement or any Supplemental Agreement either the District or the Fiscal Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Agreement contained by or on behalf of the District or the Fiscal Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not. Section 11.04. Execution of Documents and Proof of Ownership by Owners. Any request, declaration, or other instrument which this Agreement may require or permit to be executed by the Owners may be in one or more instruments of similar tenor, and shall be executed by the Owners in person or by their attorneys appointed in writing. 60285.00019\7761646.3 41 P560 Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such request, declaration or other instrument, or of such writing appointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books. Any request, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the District or the Fiscal Agent in good faith and in accordance therewith. Section 11.05. Waiver of Personal Liability. No member, officer, agent or employee of the District or the City shall be individually or personally liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duty provided by law. Section 11.06. Notices to and Demands on District and Fiscal Agent. Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Fiscal Agent to or on the District may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the District with the Fiscal Agent) as follows: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 c/o City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, California 91730 Attention: City Manager Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the District to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Fiscal Agent with the District) as follows: Wells Fargo Bank, National Association 707 Wilshire Blvd. 17th Floor Los Angeles, CA 90017 Attention: Corporate Trust Department 60285.00019\7761646.3 42 P561 Section 11.07. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The District hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable. Section 11.08. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remains unclaimed for two (2) years after the date when the payments of such principal, interest and premium have become payable, if such moneys were held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the District as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the District for the payment of the principal of, and interest and any premium on, such Bonds. Section 11.09. Provisions Constitute Contract. The provisions of this Agreement shall constitute a contract between the District and the Bondowners and the provisions hereof shall be construed in accordance with the laws of the State of California. In case any suit, action, or proceeding to enforce any right or exercise any remedy shall be brought or taken and, should said suit, action, or proceeding be abandoned, or be determined adversely to the Bondowners or the Fiscal Agent, then the District, the Fiscal Agent, and the Bondowners shall be restored to their former positions rights and remedies as if such suit, action, or proceeding had not been brought or taken. After the issuance and delivery of the Bonds this Agreement shall be irrepealable, but shall be subject to modifications to the extent and in the manner provided in this Agreement, but to no greater extent and in no other manner. Section 11.10. Future Contracts. Nothing herein contained shall be deemed to restrict or prohibit the District from making contracts or creating bonded or other indebtedness payable from a pledge of the Net Special Tax Revenues which is subordinate to the pledge hereunder, or which is payable from taxes or any source other than the Net Special Tax Revenues and other amounts pledged hereunder. Section 11.11. Further Assurances. The District will adopt, make, execute, and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the Bonds the rights and benefits provided in this Agreement. Section 11.12. Applicable Law. This Agreement shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California. 60285.00019\7761646.3 43 P562 Section 11.13. Conflict with Act. In the event of a conflict between any provision of this Agreement with any provision of the Act as in effect on the Closing Date, the provision of the Act shall prevail over the conflicting provision of this Agreement. Section 11.14. Conclusive Evidence of Regularity. Bonds issued pursuant to this Agreement shall constitute conclusive evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes. Section 11.15. Payment on Business Day. In any case where the date of the maturity of interest or of principal (and premium, if any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be taken pursuant to this Agreement is other than a Business Day, the payment of interest or principal (and premium, if any) or the action need not be made on such date but may be made on the next succeeding day which is a Business Day with the same force and effect as if made on the date required and no interest shall accrue for the period after such date. Section 11.16. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. [Remainder of this page intentionally left blank.] 60285.00019\7761646.3 44 P563 IN WITNESS WHEREOF, the District has caused this Agreement pertaining to the Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013 to be executed in its name and the Fiscal Agent has caused this Agreement to be executed in its name, all as of July 1, 2013. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 By: City Manager WELLS FARGO BANK,NATIONAL ASSOCIATION, as Fiscal Agent By: Authorized Officer S - 1 60285.00019\7761646.3 P564 EXHIBIT A FORM OF BOND No. $ UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTY OF SAN BERNARDINO CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 Improvement Area No. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 INTEREST RATE MATURITY DATE DATED DATE CUSIP September 1, , 2013 REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS The City of Rancho Cucamonga (the "City") for and on behalf of the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 (the "District"), for value received, hereby promises to pay solely from Net Special Tax Revenues (as defined in the Agreement) to be collected within Improvement Area No. 1 of the District or amounts in the funds and accounts held under the Agreement (as hereinafter defined), to the registered owner (the "Owner") named above, or registered assigns, on the maturity date set forth above, unless redeemed prior thereto as hereinafter provided, the principal amount set forth above, and to pay interest on such principal amount from the Dated Date, or from the most recent interest payment date to which interest has been paid or duly provided for, semiannually five (5) days prior to each September 1 and March 1, commencing September 1, 2013 (each an "Interest Payment Date"), at the interest rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of this Bond is payable to the registered Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the office of Wells Fargo Bank, National Association (the "Fiscal Agent"). Interest on this Bond shall be paid by check of the Fiscal Agent mailed five (5) days preceding each Interest Payment Date to the registered Owner hereof as of the close of business on the 15th day of the month preceding the month in which the interest payment date occurs (the "Record Date") at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent. A - 1 60285.00019\7761646.3 P565 This Bond is one of a duly authorized issue of bonds in the aggregate principal amount of $ pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Sections 63311, et seq., of the California Government Code (the "Mello-Roos Act') and designated the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013. The Bonds have been issued for the purpose of refunding the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A (the "Prior Special Tax Bonds"). The issuance of the Bonds and the terms and conditions thereof are provided for by the Fiscal Agent Agreement, dated as of July 1, 2013 (the "Agreement'), by and between the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. I and the Fiscal Agent and this reference incorporates the Agreement herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. Pursuant to the Mello-Roos Act and the Agreement, the principal of and interest on this Bond are payable solely from Net Special Tax Revenues of the annual special tax authorized under the Mello-Roos Act to be collected within Improvement Area No. I of the District (the "Special Tax") and certain funds held under the Agreement. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. Any tax for the payment hereof shall be limited to the Special Tax, except to the extent that provision for payment has been made by the City, as may be permitted by law. The Bonds do not constitute obligations of the City of Rancho Cucamonga for which said City is obligated to levy or pledge, or has levied or pledged, general or special taxation other than described hereinabove. The District has covenanted for the benefit of the Owners of the Bonds that it will order, and cause to be commenced as provided in the Agreement, and thereafter diligently prosecute to judgment, an action in the superior court to foreclose the lien of any Special Tax or installment thereof not paid when due. The Bonds may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of$5,000) on any Interest Payment Date, from such maturities as are selected by the District, and by lot within a maturity, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption: A - 2 60285.00019\7761646.3 P566 Redemption Date Redemption Price September 1, 20 through September 1, 20 10 % March 1, 20 and September 1, 20 10 March 1, 20 and September 1, 20_ 10_ March 1, 20 and any Interest Payment Date thereafter 100 The Bonds shall be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price September 1, 20 through September 1, 20 10_% March 1, 20 and September 1, 20 10_ March 1, 20 and September 1, 20_ 10_ March 1, 20_and any Interest Payment Date thereafter 100 In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the Bonds. Notice of redemption with respect to the Bonds to be redeemed shall be given to the registered Owners thereof, in the manner, to the extent and subject to the provisions of the Agreement. This Bond shall be registered in the name of the Owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shall be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon. Except as provided in the Agreement, any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of the Agreement by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of A - 3 60285.00019\7761646.3 P567 transfer in a form approved by the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the District shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for like aggregate principal amount. No transfers of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange. No exchanges of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or (iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. The Fiscal Agent Agreement and the rights and obligations of the Agency thereunder may be modified or amended as set forth therein. This Bond shall not become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been dated and signed by the Fiscal Agent. IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond does not exceed any debt limit prescribed by the laws or Constitution of the State of California. [Remainder of this page intentionally left blank.] A - 4 60285.00019\7761646.3 P568 IN WITNESS WHEREOF, the City of Rancho Cucamonga Community Facilities District 2003-01 has caused this Bond to be dated , 2013, to be signed by the manual or facsimile signature of the Mayor and countersigned by the manual or facsimile signature of the City Clerk, each acting for and on behalf of such community facilities district. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 BY: Mayor BY: City Clerk A - 5 60285.00019\7761646.3 P569 FISCAL AGENT'S CERTIFICATE OFAUTHENTICATION This is one of the Bonds described in the Resolution and the Agreement which has been authenticated on WELLS FARGO BANK,NATIONAL ASSOCIATION, as Fiscal Agent By: Authorized Officer A - 6 60285.00019\7761646.3 P57O ASSIGNMENT For value received, the undersigned do(es) hereby sell, assign and transfer unto (Name, Address and Tax Identification or Social Security Number of Assignee) the within Bond and do(es) hereby irrevocably constitute and appoint , attorney, to transfer the same on the registration books of the Fiscal Agent, with full power of substitution in the premises. Dated: NOTICE: The signature(s) on this assignment must correspond with the name(3) as written on the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company. A - 7 60285.00019\7761646.3 P571 ESCROW DEPOSIT AND TRUST AGREEMENT among CITY OF RANCHO CUCAMONGA, CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank Dated as of July 1, 2013 Re: CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX BONDS SERIES 2003-A 60285.00019\7762857.2 P572 ESCROW DEPOSIT AND TRUST AGREEMENT This ESCROW DEPOSIT AND TRUST AGREEMENT, dated as of July 1, 2013 (the "Escrow Agreement", among CITY OF RANCHO CUCAMONGA (the "City"), CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01, a community facilities district organized and existing by virtue of the Constitution and laws of the State of California (the "Community Facilities District"), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank (the "Escrow Bank"); WITNESSETH: WHEREAS, the City, acting for and on behalf of the Community Facilities District, has heretofore entered into a Fiscal Agent Agreement with Wells Fargo Bank, National Association, as fiscal agent (the "Prior Fiscal Agent"), dated as of July 1, 2003 (the "Prior Fiscal Agent Agreement"); and WHEREAS, pursuant to the Prior Fiscal Agent Agreement the City, acting for and on behalf of the Community Facilities District, issued the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. I Special Tax Bonds, Series 2003-A issued in the original principal amount of$14,645,000 (the "Prior Special Tax Bonds"); and WHEREAS, the Prior Fiscal Agent Agreement provides that City, acting on behalf of the Community Facilities District, shall have the option to pay and discharge the entire indebtedness on the Prior Special Tax Bonds Outstanding by irrevocably depositing with the Fiscal Agent, in trust, cash and Federal Securities (as defined in the Prior Fiscal Agent Agreement) in such amount as the City shall determine as confirmed by an independent certified public accountant will, together with interest to accrue to thereon and moneys then on deposit in certain funds and accounts established pursuant to the Prior Fiscal Agent Agreement and certain additional moneys then on deposit with the City for and on behalf of the Community Facilities District, fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates; and WHEREAS, the City and the Community Facilities District have determined that it is in the best interests of the Community Facilities District at this time to refinance the Prior Special Tax Bonds and cause the redemption thereof on September 3, 2013, at a redemption price of 100% of the principal amount thereof, plus accrued interest thereon to the date of redemption; and WHEREAS, the City and the Community Facilities District propose to make the and/or cause the deposit of moneys with the Escrow Bank and to appoint the Escrow Bank as their agent for the purpose of applying said deposit to the payment and redemption of the Prior Special Tax Bonds in accordance with the instructions provided by this Escrow Agreement and the Prior Fiscal Agent Agreement, and the Escrow Bank will accept said appointment; and WHEREAS, to obtain moneys to make such deposit, the Community Facilities District proposes to issue its $ Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Refunding Bonds, Series 2013 (the "2013 Bonds") pursuant to that certain Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent 1 60285.00019\7762857.2 P573 Agreement'), by and between the Community Facilities District and Wells Fargo Bank, National Association, as fiscal agent (the"Fiscal Agent'); and WHEREAS, the City and the Community Facilities District wish to make such deposit with the Escrow Bank and to enter into this Escrow Agreement for the purpose of providing the terms and conditions for the deposit and application of amounts so deposited; and WHEREAS, the Escrow Bank has full powers to act with respect to the irrevocable escrow and trust created herein and to perform the duties and obligations to be undertaken pursuant to this Escrow Agreement. NOW, THEREFORE, in consideration of the above premises and of the mutual promises and covenants herein contained and for other valuable consideration, the parties hereto do hereby agree as follows: Section 1. Appointment of Escrow Bank. The City and the Community Facilities District hereby appoints the Escrow Bank as escrow bank for all purposes of this Escrow Agreement and in accordance with the terms and provisions of this Escrow Agreement, and the Escrow Bank hereby accepts such appointment. Section 2. Establishment of Escrow Fund. There is hereby created by the City and the Community Facilities District with, and to be held by, the Escrow Bank, an irrevocable escrow to be maintained in trust by the Escrow Bank on behalf of the Community Facilities District and for the benefit of the owners of the Prior Special Tax Bonds, said escrow to be designated the "Escrow Fund." All moneys deposited in the Escrow Fund shall be held as a special fund for the payment of the debt service payments in accordance with the provisions of the Prior Fiscal Agent Agreement. if at any time the Escrow Bank shall receive actual knowledge that the moneys in the Escrow Fund will not be sufficient to make any payment required by Section 3 hereof, the Escrow Bank shall notify the Community Facilities District of such fact and the Community Facilities District shall immediately cure such deficiency. Section 3. Deposit into Escrow Fund. Concurrently with delivery of the Bonds, the City and Community Facilities District shall cause to be transferred to the Escrow Bank for deposit into the Escrow Fund the amount of$ (the "Escrow Fund Deposit Amount') in immediately available funds which shall be derived as follows: (a) $ with respect to the Prior Special Tax Bonds comprised of(i) $ representing funds on deposit in the Reserve Fund, (iii) $ representing funds on deposit in the Administrative Expense Fund, (ii) $ representing funds on deposit in the Project Fund and (iii) $ representing funds on deposit in the Developer Project Fund, (b) $ on deposit with the City and held for and on behalf of the Community Facilities District and (c) $ to come from the Fiscal Agent pursuant to the Fiscal Agent Agreement from the proceeds of the 2012 Bonds. Causey, Demgen & Moore Inc., certified public accountants, has prepared a report at to the sufficiency of the Escrow Fund Deposit Amount to pay the principal and interest on the outstanding Prior Special Tax Bonds on September 1, 2013 (the "Verification Report"), a copy of which is attached as Appendix A hereto and incorporated herein by this reference. 2' 60285.00019\7762857.2 P574 The Escrow Bank shall hold the moneys deposited into the Escrow Fund pursuant to the preceding paragraph in cash uninvested (the "Cash"). Such Cash shall be deposited with and held by the Escrow Bank in the Escrow Fund solely for the uses and purposes set forth herein. Section 4. Instructions to Escrow Bank. The Community Facilities District hereby irrevocably directs and instructs the Escrow Bank to redeem the outstanding Prior Special Tax Bonds in full on September 1, 2013 at a redemption price equal to the principal amount thereof, together with accrued interest to the date of redemption, all as more particularly set forth in Exhibit to the Verification Report. For such purpose of call and redemption prior to maturity of the Prior Special Tax Bonds, the Community Facilities District hereby instructs the Escrow Bank, and the Escrow Bank hereby agrees to cause to be given notice of redemption of the Prior Special Tax Bonds on or before August 1, 2013, such notice of redemption to be given substantially in the form set for in Exhibit C attached hereto and hereby made a part hereof and timely for redemption of the Prior Special Tax Bonds on September 1, 2013, in accordance with the applicable provisions of the Prior Fiscal Agent Agreement. Section 5. Application of Certain Terms of Prior Fiscal Agent Agreement. All of the terms of the Prior Fiscal Agent Agreement relating to the making of payments of principal and interest with respect to the Prior Special Tax Bonds are incorporated in this Escrow Agreement as if set forth in full herein. The provisions of the Prior Fiscal Agent Agreement relating to the limitations from liability and protections afforded the Prior Fiscal Agent and the resignation and removal of the Prior Fiscal Agent are also incorporated in this Escrow Agreement as if set forth in full herein and shall be the procedure to be followed with respect to any resignation or removal of the Escrow Bank hereunder. Section 6. Compensation to Escrow Bank. The Community Facilities District shall pay the Escrow Bank full compensation for its duties under this Escrow Agreement, including out-of-pocket costs such as publication costs, prepayment or redemption expenses, legal fees and other costs and expenses relating hereto pursuant to a separate agreement between the Community Facilities District and the Escrow Bank. Under no circumstances shall amounts deposited in the Escrow Fund be deemed to be available for said purposes. Section 7. Liabilities and Obligations of Escrow Bank. The Escrow Bank shall have no obligation to make any payment or disbursement of any type or incur any financial liability in the performance of its duties under this Escrow Agreement unless the Community Facilities District shall have deposited sufficient funds with the Escrow Bank to satisfy such obligation. The Escrow Bank may rely and shall be protected in acting upon the written instructions of the City and/or the Community Facilities District or its agents relating to any matter or action as Escrow Bank under this Escrow Agreement. The Escrow Bank undertakes such duties as specifically set forth herein and no implied duties or obligations shall be read into this Escrow Agreement against the Escrow Bank. The Community Facilities District hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to indemnify, 3 60285.00019\7762857.2 P575 protect, save and hold harmless the Escrow Bank and its respective successors, assigns, agents and servants from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs, expenses and disbursements (including legal fees and disbursements) of whatsoever kind and nature which may be imposed on, incurred by, or asserted against, at any time, the Escrow Bank (whether or not also indemnified against by any other person under any other agreement or instrument) and in any way relating to or arising out of the execution and delivery of this Escrow Agreement, the establishment of the Escrow Fund, the retention of the moneys therein and any payment, transfer or other application of moneys or securities by the Escrow Bank in accordance with the provisions of this Escrow Agreement, or as may arise by reason of any act, omission or error of the Escrow Bank made in good faith in the conduct of its duties; provided, however, that the Community Facilities District shall not be required to indemnify the Escrow Bank against its own negligence or misconduct. The indemnities contained in this Section 8 shall survive the termination of this Escrow Agreement and the resignation and removal of the Escrow Bank. The Escrow Bank shall not have any liability hereunder except to the extent of its own negligence or willful misconduct. In no event shall the Escrow Bank be liable for any special indirect or consequential damages. The Escrow Bank may consult with counsel of its own choice and the opinion of such counsel shall be full and complete authorization to take or suffer in good faith any action hereunder in accordance with such opinion of counsel. The Escrow Bank shall not be responsible for any of the recitals or representations contained herein. No provision of this Escrow Agreement shall require the Escrow Bank to expend or risk its own funds or otherwise incur any financial liability in the performance or exercise of any of its duties hereunder, or in the exercise of its rights or powers. Section 8. Amendment. This Escrow Agreement may be modified or amended at any time by a supplemental agreement which shall become effective when the written consents of the owners of one hundred percent (100%) in aggregate principal amount of the Prior Special Tax Bonds then outstanding shall have been filed with the Escrow Bank. This Escrow Agreement may be modified or amended at any time by a supplemental agreement, without the consent of any such owners, but only (1) to add to the covenants and agreements of any party, other covenants to be observed, or to surrender any right or power herein or therein reserved to the Community Facilities District, (2) to cure, correct or supplement any ambiguous or defective provision contained herein, or (3) in regard to questions arising hereunder or thereunder, as the parties hereto or thereto may deem necessary or desirable and which, in the opinion of counsel, shall not adversely affect the interests of the owners of the Prior Special Tax Bonds or the Bonds, and that such amendment will not cause interest on the Prior Special Tax Bonds or the Bonds to become subject to federal income taxation. Section 9. Termination: Unclaimed Money. This Escrow Agreement shall terminate when the Prior Special Tax Bonds have been paid;provided, however, that (i) money held by the Escrow Bank pursuant to this Escrow Agreement for the payment and discharge of any of the Prior Special Tax Bonds (which shall not be payable as to interest from and after the 4 60285.00019\7762857.2 P576 date set for redemption) which remain unclaimed for two (2) years after such payments were due, shall be repaid by the Escrow Bank to the Community Facilities District free from the trust created by the Prior Fiscal Agent Agreement and this Escrow Agreement, and the Escrow Bank shall thereupon be released and discharged with respect thereto and hereto and all liability of the Escrow Bank with respect to such money shall thereupon cease and (ii) excess moneys held by the Escrow Bank not needed for the payment and discharge of the Prior Special Tax Bonds shall be transferred to the Bond Fund under the Fiscal Agent Agreement. Section 10. Severability. If any section, paragraph, sentence, clause or provision of this Escrow Agreement shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, sentence, clause or provision shall not affect any of the remaining provisions of this Escrow Agreement. Section 11. Notice to Escrow Bank, the City and the Community Facilities District. Any notice or demand which by any provision of this Escrow Agreement is required or permitted to be given or served by the Escrow Bank to or on the City and/or the Community Facilities District may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the City and/or the Community Facilities District with the Fiscal Agent) as follows: City of Rancho Cucamonga Community Facilities District No. 2003-01 c/o City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, California 91730 Attention: City Manager Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the City and/or the Community Facilities District to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Fiscal Agent with the City and/or the Community Facilities District) as follows: Wells Fargo Bank,National Association 707 Wilshire Blvd. 17th Floor Los Angeles, CA 90017 Attention: Corporate Trust Department Section 12. Merger or Consolidation of Escrow Bank. Any company into which the Escrow Bank may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Escrow Bank may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible to act as Trustee under the Indenture and the Prior Fiscal Agent Agreement, shall be the successor hereunder to the Escrow Bank without the execution or filing of any paper or any further act. Section 13. Execution in Several Counterparts. This Escrow Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be 5 60285.00019\7762857.2 P577 deemed to be an original; and all such counterparts shall constitute but one and the same instrument. 6 60285.00019\7762857.2 P578 IN WITNESS WHEREOF, the City, the Community Facilities District and the Escrow Bank have each caused this Escrow Deposit and Trust Agreement to be executed by their duly authorized officers all as of the date first above written. CITY OF RANCHO CUCAMONGA By: City Manager CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: City Manager WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank By: Authorized Officer 7 60285.00019\7762857.2 P579 EXHIBIT A VERIFICATION REPORT A - 1 60285.00019\7762857.2 P580 EXHIBIT NOTICE OF REDEMPTION CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX BONDS, SERIES 2003-A NOTICE IS HEREBY GIVEN that on September 1, 2013 (the "Redemption Date"), the above-captioned bonds (the "Bonds") have been called for redemption pursuant to Section 2.3(A)(i) of the Fiscal Agent Agreement, dated as of August 1, 2001, by and between Wells Fargo Bank, National Association, as fiscal agent (the "Fiscal Agent"), and the City of Rancho Cucamonga, for and on behalf of Community Facilities District No. 2003-01 (the "Community Facilities District"). The Bonds will be prepaid at 100% of the principal amount, plus accrued interest(the "Redemption Price"). Interest will be paid in the usual manner. The CUSIP numbers and maturity dates of the Bonds are listed below: CUSIP Number Maturity Date The Bonds are due and payable at the office of the Fiscal Agent on Redemption Date. Interest will cease to accrue on the Bonds from and after the Redemption Date. The Bonds should be presented for redemption to the office of the Fiscal Agent at the following address: [TO COME] To avoid a 28% back-up withholding tax required by Federal law, holders of Bonds must submit with their Bonds a completed IRS Form W-9. For your convenience a Form W-9 has been enclosed. The CUSIP number has been assigned by Standard & Poor's Corporation and is included solely for the convenience of the holders of Bonds. Neither the Community Facilities District nor the Trustee shall be responsible for the selection or use of the CUSIP numbers nor is any representation made as to their correctness on the Bonds or as indicated in any redemption Notice. Dated: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank 60285.00019\7762857.2 -1- Stradling Yocca Carlson &Routh P581 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 BOND PURCHASE AGREEMENT 12013 Community Facilities District No. 2003-01 Improvement Area No. 1 of the City of Rancho Cucamonga Rancho Cucamonga, California Ladies and Gentlemen: Stifel, Nicolaus & Company, Incorporated dba Stone & Youngberg, a Division of Stifel Nicolaus (the "Underwriter") offers to enter into this Bond Purchase Agreement with the Community Facilities District No. 2003-01, Improvement Area No. 1, of the City of Rancho Cucamonga (the "District") which, upon acceptance, will be binding upon the District and upon the Underwriter. This offer is made subject to acceptance of it by the District on the date hereof, and if not accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the District at any time prior to the acceptance hereof by the District. The District acknowledges and agrees that: (i) the purchase and sale of the Bonds (defined below) pursuant to this Purchase Agreement is an arm's-length commercial transaction between the District and the Underwriter; (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as a principal and is not acting as a Municipal Advisor (as defined in Section 15B of The Securities Exchange Act of 1934, as amended); (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the District with respect to the offering contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the District on other matters); (iv) the District has consulted its own legal, financial and other advisors to the extent it has deemed appropriate; and (v) the Underwriter has financial and other interests that differ from those of the District. I. Purchase, Sale and Delivery of the Bonds. (a) Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein, the Underwriter agrees to purchase from the District, and the District agrees to sell to the Underwriter, all (but not less than all) of the Community Facilities District No. 2003-01, Improvement Area No. 1, of the City of Rancho Cucamonga Special Tax I DOCSOC/1603063v6/022245-0265 - P582 Refunding Bonds, Series 2013 (the "Bonds") in the aggregate principal amount specified in Exhibit A hereto. The Bonds shall be dated the date of their delivery, and bear interest (payable semiannually on March 1 and September I in each year), commencing on March 1, 2014, at the rates per annum and maturing on the dates and in the amounts as set forth in said Exhibit A. The purchase price for the Bonds shall be the amount specified as such in Exhibit A hereto. The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable and subject to redemption as provided in, the Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent Agreement") executed by the District, acting through the City Council of the City of Rancho Cucamonga (the "City"), sitting as the legislative body of the District (the "City Council"), and Wells Fargo Bank, National Association, as Fiscal Agent, which was approved by the District in a resolution (the "Resolution"), adopted by the City Council on July 3, 2013. The Bonds and interest thereon will be payable from a special tax (the "Special Tax") levied and collected in accordance with the Fiscal Agent Agreement and an ordinance adopted by the City Council, on [February 19, 2003] (the "Ordinance"). Proceeds of the sale of the Bonds will be used in accordance with the Fiscal Agent Agreement and the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California) (the "Act"), to refund the District's outstanding Special Tax Bonds, Series 2003-A (the "Refunded Bonds") in accordance with an Escrow Agreement, dated as of April 1, 2013 (the "Escrow Agreement"), by and between the District and Wells Fargo Bank, National Association, as Escrow Agent. The Bonds are being issued in accordance with the provisions of the Fiscal Agent Agreement, the Act and Article 11, commencing with Section 53580, of Chapter 3 of Part l of Division 2 of Title 5 of the California Government Code (the "Law"). (b) At or prior to the acceptance hereof by the District, the City on behalf of the District shall cause to be delivered to the Underwriter (i) a certificate executed by FC Victoria Gardens-C, Inc., a California corporation ("Victoria Gardens"), dated on or prior to the date of this Bond Purchase Agreement in the form attached hereto as Exhibit B-1; (ii) a certificate executed by LC Cucamonga Commercial, Inc, a California corporation ("LC Cucamonga"), dated on or prior to the date of this Bond Purchase Agreement in the form attached hereto as Exhibit B-2, and (iii) a certificate executed by Rancho Mall, LLC, a California limited liability company ("Rancho Mall"), dated on or prior to the date of this Bond Purchase Agreement in the form attached hereto as Exhibit B-3. (c) Pursuant to the authorization of the District, the Underwriter has distributed copies of the Preliminary Official Statement, dated July_, 2013, relating to the Bonds, which, together with the cover page and all appendices thereto, is herein called the "Preliminary Official Statement" and which, as amended by the District with the prior approval of the Underwriter, will be referred to herein as the "Official Statement." The District hereby ratifies the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to use and distribute the Official Statement, the Fiscal Agent Agreement, the other documents or contracts to which the City or the District is a party, including this Bond Purchase Agreement, and all information contained therein, and all other documents, certificates and statements furnished by the City or the District to the Underwriter in connection with the transactions contemplated by this Bond Purchase Agreement, in connection with the offer and sale of the Bonds by the Underwriter. At or prior to the Closing Date (described below), the District shall have authorized, executed and delivered the Continuing Disclosure Certificate, dated as of the Closing Date (the "Continuing Disclosure Certificate"), which 2 DOCSOC/1603063v6/022245-0268 P583 complies with paragraph (b)(1) of Section 240.15c2-12 in Chapter II of Title 17 of the Code of Federal Regulations("Rule 15c2-12"), substantially in the form described in the Official Statement. (d) At 8:00 A.M., Los Angeles time, on July_, 2013, or at such earlier time or date as shall be agreed upon by the Underwriter and the District (such time and date being herein referred to as the "Closing Date"), the District will deliver to the Underwriter through the book-entry system of The Depository Trust Company, the Bonds in temporary or definitive form, bearing CUSIP numbers, and duly executed by the officers of the District as provided in the Fiscal Agent Agreement and with the facsimile seal of the City printed thereon. Additionally, the District will deliver to the Underwriter at the offices of Best, Best & Krieger, LLP ("Bond Counsel'), in San Diego, California, or such other location in San Diego, California, as may be agreed to by the District and the Underwriter, the other documents herein mentioned; and the Underwriter shall accept such delivery and pay the purchase price of the Bonds in immediately available funds (such delivery and payment being herein referred to as the "Closing"). The Bonds shall be in fully registered form, registered in the name of CEDE& Co., as nominee of The Depository Trust Company. The District will make such Bonds available for inspection by the Underwriter not later than the business day prior to the Closing. 2. Representations, Warranties and Agreements of the District. The District represents, warrants and covenants to and agrees with the Underwriter that: (a) The District is duly organized and validly existing as a community facilities district under the laws of the State of California and has, and at the Closing Date will have, as the case may be, full legal right, power and authority (i) to execute, deliver and perform its obligations under this Bond Purchase Agreement and to carry out all transactions contemplated hereby, (ii)to issue, sell and deliver the Bonds to the Underwriter pursuant to the Resolution and the Fiscal Agent Agreement as provided herein, and (iii) to carry out, give effect to and consummate the transactions contemplated by the Resolution, the resolution forming the District adopted by the City Council on February 19, 2003 (the "Resolution of Formation'), the Ordinance, the Official Statement, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement; (b) The District has complied, and will at the Closing Date be in compliance, in all respects with the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Act, the Law, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement and the District will continue to comply with the covenants of the District contained in the Fiscal Agent Agreement; (c) The City Council has duly and validly: (i) adopted the Resolution, the Resolution of Formation and the Ordinance; (ii)called, held and conducted in accordance with all requirements of the Act an election to approve the levy of the Special Taxes; (iii) authorized and approved the execution and delivery of the Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement; (iv) authorized the preparation and delivery of the Official Statement; and (v) authorized and approved the performance by the City and the District of their respective obligations contained in, and the taking of any and all action as may be necessary to carry out, give effect to and consummate the transactions contemplated by, each of said documents (including, without limitation, the collection of the Special Tax), and at the Closing Date, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Bonds, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the 3 DOCSOC/1603063 v6/022245-0268 P584 Escrow Agreement will constitute the valid, legal and binding obligations of the District, and (assuming due authorization, execution and delivery by other parties thereto, where necessary) will be enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought; (d) To the best of its knowledge, the District is not in breach of or default under any applicable law or administrative rule or regulation of the State of California (the "State"), or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the District is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the performance by the District of its obligations under the Bonds, the Resolution, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate, this Bond Purchase Agreement, or the Escrow Agreement, and compliance with the provisions of each thereof, will not in any respect material to the transactions referred to herein or contemplated hereby, conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the District or the City, as the case may be, is a party or is otherwise subject or bound; (e) All approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the performance by the District of its obligations hereunder, or under the Resolution, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Bonds, the Continuing Disclosure Certificate or the Escrow Agreement, have been or will be obtained and are in full force and effect, except that the District provides no representation regarding compliance with blue sky or other securities laws or regulations whatsoever; (t) The Special Tax constituting the security for the Bonds has been duly and lawfully authorized and may be levied under the Act and the Constitution and the applicable laws of the State of California, and such Special Tax constitutes a valid and legally binding lien on the properties on which it has been levied; (g) Until the date which is twenty-five (25) days after the "end of the underwriting period" (as hereinafter defined), if any event shall occur of which the District is aware, as a result of which it may be necessary to supplement the Official Statement in order to make the statements in the Official Statement, in light of the circumstances existing at such time, not misleading, the District shall forthwith notify the Underwriter of any such event of which it has knowledge and shall cooperate fully in furnishing any information available to it for any supplement to the Official Statement necessary, in the Underwriter's opinion, so that the statements therein as so supplemented will not be misleading in light of the circumstances existing at such time and the District shall promptly furnish to the Underwriter a reasonable number of copies of such supplement. As used herein, the term "end of the underwriting period" means the later of such time as (i)the District delivers the Bonds to the Underwriter, or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the "end of the underwriting period" shall be deemed to 4 DOC SOC/1 603063 v6/022245-0268 P585 be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the District at or prior to the Closing Date, and shall specify a date (other than the Closing Date) to be deemed the "end of the underwriting period;" (h) The Fiscal Agent Agreement creates a valid pledge of the Net Special Tax Revenues (as defined in the Fiscal Agent Agreement) and the moneys in the Reserve Fund, the Escrow Fund, and the Special Tax Fund established pursuant to the Fiscal Agent Agreement, including the investments thereof, subject in all cases to the provisions of the Fiscal Agent Agreement permitting the application thereof for the purposes and on the terms and conditions set forth therein; (i) As of the time of acceptance hereof, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending in which service of process has been completed against the District or the City or, to the best knowledge of the District, threatened against the District or the City (i) which would materially adversely affect the ability of either the City or the District to perform its obligations under the Bonds, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate or the Escrow Agreement, or (ii) seeking to restrain or to enjoin the development of the land within the District, the issuance, sale or delivery of the Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement and the Escrow Agreement, or the collection or application of the Special Tax pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Bonds, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Continuing Disclosure Certificate, this Bond Purchase Agreement or the Escrow Agreement, any other instruments relating to the development of any of the property within the District, or any action of the District contemplated by any of said documents or (iii) in any way contesting the completeness or accuracy of the Preliminary Official Statement or the powers or authority of the City or the District with respect to the Bonds, the Resolution, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Resolution of Formation and the Ordinance or any action of the City or the District contemplated by any of said documents; or (iv) which alleges that interest on the Bonds is not excludable from gross income for federal income tax purposes or is not exempt from California personal income taxation; Q) The District will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order for the Underwriter to qualify the Bonds for offer and sale under the "Blue Sky" or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate; provided, however, the District shall not be required to register as a dealer or a broker of securities nor shall the District be required to consent to service of process or jurisdiction or qualify to do business in anyjurisdiction or to expend funds for this purpose; (k) Any certificate signed by any authorized official of the District authorized to do so shall be deemed a representation and warranty of the District to the Underwriter as to the statements made therein; (1) The District will apply the proceeds of the Bonds in accordance with the Fiscal Agent Agreement and the Escrow Agreement and as described in the Official Statement; 5 DOCS OC/1603063 v6/022245-0268 P586 (m) The information contained in the Preliminary Official Statement was, and in the Official Statement (other than information relating to The Depository Trust Company and its book-entry-only system, as to which no view is expressed) is and on the Closing Date shall be, true and correct in all material respects and such information does not contain any untrue or misleading statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (n) Except as disclosed in the Official Statement, the District has never failed to comply in any material respect with any of its previous undertakings with respect to Rule 150-12; and (o) The Preliminary Official Statement heretofore delivered to the Underwriter is deemed final by the District as of its date except for the omission of such information as is permitted to be omitted in accordance with Rule 15c2-12. The District hereby covenants and agrees that, within seven (7) business days from the date hereof, or upon reasonable written notice from the Underwriter within sufficient time to accompany any confirmation requesting payment from any customers of the Underwriter, the District shall cause a final printed form of the Official Statement to be delivered to the Underwriter in sufficient quantity to comply with the rules of the Securities and Exchange Commission and the Municipal Securities Rulemaking Board. 3. Representations, Warranties, Covenants and Agreements of the Underwriter. The Underwriter represents, warrants, covenants and agrees with the District as follows: (a) To file a copy of the Official Statement, including any supplements prepared by the District, with the Municipal Securities Rulemaking Board, and (b) to take any and all other actions necessary to comply with applicable Securities and Exchange Commission and Municipal Securities Rulemaking Board rules governing the offering, sale and delivery of the Bonds to ultimate purchasers. 4. Conditions to the Obligations of the Underwriter. The obligations of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the representations and warranties on the part of the District contained herein, as of the date hereof and as of the Closing Date, to the accuracy in all material respects of the statements of the officers and other officials of the City and the District made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the District of its respective obligations to be performed hereunder at or prior to the Closing Date and to the following additional conditions: (a) At the Closing Date, the Resolution, the Resolution of Formation, the Ordinance, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, the Escrow Agreement, and this Bond Purchase Agreement shall be in full force and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to by the Underwriter, and there shall have been taken in connection therewith, with the issuance of the Bonds and with the transactions contemplated thereby and by this Bond Purchase Agreement, all such actions as, in the opinion of Bond Counsel, shall be necessary and appropriate; (b) Between the date hereof and the Closing Date, the market price or marketability of the Bonds at the initial offering prices set forth in the Official Statement shall not 6 DOC SOC/1603063 v6/022245-0268 P587 have been materially adversely affected, in the reasonable judgment of the Underwriter (evidenced by a written notice to the District terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following: (1) legislation enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congress by any committee of such House to which such legislation had been referred for consideration or a decision rendered by a court established under Article 111 of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department or the Internal Revenue Service of the United States of America, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon the interest as would be received by the holders of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof; (2) legislation enacted (or resolution passed) by the Congress of the United States of America, or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, or the Bonds, including any or all underlying arrangements, are not exempt from registration under the Securities Act of 1933, as amended, or that the Fiscal Agent Agreement is not exempt from qualification under the Trust Indenture Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character of the Bonds, including any or all underwriting arrangements, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws as amended and then in effect; (3) a general suspension of trading in securities on the New York Stock Exchange, or a general banking moratorium declared by Federal, State of New York or State of California officials authorized to do so, or a war or other national calamity; (4) any amendment to the federal or California Constitution or action by any federal or California court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the District, its property, income, securities (or interest thereon), the validity or enforceability of the Special Tax; (5) any event occurring, or information becoming known, which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Official Statement, or results in the Official Statement containing any untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and (6) any rating of the Bonds shall have been downgraded or withdrawn by a national rating service, which, in the opinion of the Underwriter, materially adversely affects the market price of the Bonds. 7 DOC SOC/1603063 v61022245-0268 P588 (c) On the Closing Date, the Underwriter shall have received counterpart originals or certified copies of the following documents, in each case satisfactory in form and substance to the Underwriter: (1) The Resolution, the Resolution of Formation and the Ordinance, together with a certificate dated as of the Closing Date of a City Clerk of the City Council to the effect that each is a true, correct and complete copy of the one duly adopted by the City Council; (2) An executed copy of the Fiscal Agent Agreement; (3) A copy of the Official Statement; (4) An executed copy of the Escrow Agreement; (5) An executed copy of the Continuing Disclosure Certificate of the District, dated the date of the Closing; (6) An unqualified approving opinion, dated the Closing Date and addressed to the District, of Bond Counsel, in the form attached to the Preliminary Official Statement as Appendix D and a letter of such counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such opinion addressed to the District may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it; (7) A supplemental opinion, dated the Closing Date and addressed to the District and the Underwriter, of Bond Counsel to the effect that (i) the Bond Purchase Agreement, the Escrow Agreement and the Continuing Disclosure Certificate have been duly authorized, executed and delivered by the District, and, assuming the execution and delivery by the other parties thereto as appropriate, the Bond Purchase Agreement, the Escrow Agreement and the Continuing Disclosure Certificate constitute the legally valid and binding agreements of the District enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, moratorium, insolvency or other laws affecting creditor's rights or remedies and is subject to general principles of equity (regardless of whether such enforceability is considered in equity or at law); (ii)the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Fiscal Agent Agreement is exempt from qualification under the Trust Indenture Act of 1939, as amended; (iii)the information contained in the Official Statement with respect to the Bonds under the captions "THE 2013 BONDS," "PLAN OF REFUNDING," "SECURITY FOR THE 2013 BONDS" and "TAX MATTERS" and in APPENDIX C—"SUMMARY OF THE FISCAL AGENT AGREEMENT" (except information relating to The Depository Trust Company and its book-entry system, as to which no opinion need be expressed) is accurate in all material respects; (iv) the Special Taxes have been duly and validly authorized in accordance with the provisions of the Act and, when levied in accordance with the Act and the Ordinance, the Special Taxes shall represent a valid lien on the respective properties against which the Special Taxes have been levied; and (v)the Refunded Bonds set forth in the Escrow Agreement, have been defeased and are no longer outstanding in accordance with the terms of the Fiscal Agent Agreement, pursuant to which the Refunded Bonds were issued. In rendering the opinion set forth in clause (v), Bond Counsel may expressly assume that all actions required to be taken under the Fiscal Agent Agreement have been taken and that all covenants and agreements contained in the Fiscal Agent Agreement have been complied with; 8 DOCSOC/1603063 v6/022245-0268 P589 (8) An opinion, dated the Closing Date and addressed to the Underwriter, of Jones Hall, a Professional Law Corporation, San Francisco, California, as Disclosure Counsel, to the effect that (i)the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Fiscal Agent Agreement is exempt from qualification pursuant to the Trust Indenture Act of 1939, as amended and (ii)without having undertaken to determine independently the accuracy or completeness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the City, City Attorney, Bond Counsel, representatives of the Underwriter and others, and their examination of certain documents, no information has come to the attention of the attorneys in the firm providing legal services to the Underwriter with respect to the Bonds which would lead them to believe that the Official Statement as of its date and as of the Closing Date contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to the Appendices of the Official Statement or any other financial, statistical and demographic data or forecasts, numbers, charts, estimates, projections, assumptions or expressions of opinion, and information about book-entry or the DTC contained in the Official Statement); (9) An opinion, dated the Closing Date and addressed to the Underwriter, of Stradling Yocca Carlson & Rauth, a Professional Corporation,Newport Beach, California, in form and substance satisfactory to the Underwriter; (10) A Certificate, dated the Closing Date and signed by an authorized representative of the District and the City, ratifying the use and distribution by the Underwriter of the Preliminary Official Statement and the Official Statement in connection with the offering and sale of the Bonds and certifying that (i)the representations and warranties of the District contained in Section 2 hereof are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii)to the best of his or her knowledge, no event has occurred since the date of the Official Statement affecting the matters contained therein which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make the statements and information contained in the Official Statement with respect to the District and the City not misleading in any material respect, and the Bonds, the Fiscal Agent Agreement and other applicable agreements conform as to form and tenor to the descriptions thereof contained in the Official Statement; and (iii)the District has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under this Bond Purchase Agreement, the Resolution, the Resolution of Formation, the Ordinance, the Escrow Agreement and the Fiscal Agent Agreement at or prior to the Closing Date; (11) An opinion, dated the Closing Date and addressed to the Underwriter, of counsel to the District and the City, to the effect that (i)to the best of her knowledge, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending in which service of process has been completed against the District or the City, or threatened against the City or the District which would materially adversely affect the ability of the District to perform its obligations hereunder or under the Bonds, the Fiscal Agent Agreement, the Resolution, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate or the Escrow Agreement, or seeking to restrain or to enjoin the issuance, sale, delivery of the Bonds or the exclusion from gross income for federal income tax purposes or State of California personal income taxes of interest on the Bonds, or the application of the proceeds thereof in accordance with the Fiscal Agent Agreement and the Escrow Agreement, or the collection or 9 DOCSOC/1 603063 v6/022245-0268 P590 application of the Special Tax to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bonds, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Continuing Disclosure Certificate, the Escrow Agreement or this Bond Purchase Agreement or the accuracy of the Official Statement, or any action of the City or the District contemplated by any of said documents; (ii)the City is duly organized and validly existing as a municipal corporation and general law City, duly organized and validly existing under the Constitution and laws of the State of California and the District is duly organized and validly existing as a community facilities district under the Constitution and laws of the State of California, with, as the case may be, full legal right, power and authority to issue the Bonds and to perform all of its obligations under this Bond Purchase Agreement, the Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Certificate and the Escrow Agreement; (iii) except for the adoption of the resolution each year approving the annual levy of the Special Tax by the City, acting as the legislative body of the District, the District has obtained all approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which constitute a condition precedent to the levy of the Special Tax, the issuance of the Bonds or the performance by the District of its obligations thereunder or under the Fiscal Agent Agreement or the Escrow Agreement, except that no opinion need be expressed regarding compliance with blue sky or other securities laws or regulations, whatsoever; (iv)the City Council has duly and validly adopted the Resolution, the Resolution of Formation and the Ordinance at meetings of the City Council which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting at the time of adoption, and the Resolution, the Resolution of Formation, the Ordinance, the Fiscal Agent Agreement and the Escrow Agreement are now in full force and effect and the same have not been amended; and (v) the District has duly authorized, executed and delivered this Bond Purchase Agreement, the Fiscal Agent Agreement, the Escrow Agreement and the Bonds and has duly authorized the preparation and delivery of the Official Statement, and this Bond Purchase Agreement, the Bonds, the Continuing Disclosure Certificate, the Escrow Agreement, the Continuing Disclosure Certificate and the Fiscal Agent Agreement constitute legal, valid and binding agreements of the District, enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought and to limitations on remedies imposed in actions against public entities in the State of California; (12) A tax certificate of the District, in a form acceptable to Bond Counsel; (13) A certificate of the District executed by an authorized representative thereof, dated the Closing Date and in form and substance satisfactory to the Underwriter and counsel to the Underwriter, to the effect that the District is in full compliance with all of its prior undertakings entered into pursuant to the provisions of Rule 150-12(b)(5); (14) A certificate from David Taussig& Associates, Inc. to the effect that (i) the Special Tax, if applied and collected in accordance with the terms set forth in the Rate and Method of Apportionment of Special Tax of the District, would generate an amount at least equal to debt service on the Bonds, (ii) the Special Taxes, if collected in the maximum amounts permitted pursuant to the Rate and Method of Apportionment of Special Tax on the date hereof, would generate at least 110% of the maximum debt service on the Bonds, based on such assumptions and qualifications as shall be acceptable to the Underwriter, and (iii)the information supplied by such firm for use in the sections captioned "SECURITY FOR THE 2013 BONDS—Special Taxes," "- 10 DOCSOC/1603063 v6/022245-0268 P591 Summary of Rate and Method," "IMPROVEMENT AREA NO. 1—Land Use Distribution," "- Assessed Property Values," "—Value-to-Lien Ratio," "—Land Owners," "—Delinquencies," and "—Scheduled Debt Service Coverage" of the Official Statement is true and correct as of the date of the Official Statement and as of the Closing Date; (15) A certificate dated the Closing Date, from Victoria Gardens, in substantially the form attached hereto as Exhibit D-1; (16) A certificate dated the Closing Date, from LC Cucamonga, in substantially the form attached hereto as Exhibit D-2; (17) A certificate dated the Closing Date, from Rancho Mall, in substantially the form attached hereto as Exhibit D-3; (18) A Continuing Disclosure Certificate (Tenants-In-Common), executed by both Victoria Gardens and LC Cucamonga, in substantially the form attached to the Official Statement as Appendix F; (19) An opinion dated the Closing Date and addressed to the Underwriter and the City by counsel to Victoria Gardens, substantially in the form attached hereto as Exhibit C; (20) An opinion dated the Closing Date and addressed to the Underwriter and the City by counsel to LC Cucamonga, substantially in the form attached hereto as Exhibit C; and (21) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the statements and information contained in the Preliminary Official Statement and the Official Statement, of the District's representations and warranties contained herein and the due performance or satisfaction by the District at or prior to the Closing of all agreements then to be performed and all conditions then to be satisfied by the District in connection with the transactions contemplated hereby and by the Resolution and the Official Statement. If the District shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Bond Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Bond Purchase Agreement, this Bond Purchase Agreement shall terminate and neither the Underwriter nor the District shall be under any further obligation hereunder, except that the respective obligations of the District and the Underwriter set forth in Section 6 hereof shall continue in full force and effect. 5. Conditions of the District's Oblations. The District's obligations hereunder are subject to the Underwriter's performance of their obligations hereunder, and are also subject to the following conditions: (a) As of the Closing Date, no litigation shall be pending in which service of process has been completed against the District or, to the knowledge of the duly authorized officer of the District executing the certificate referred to in Section 4(c)(10) hereof, threatened, to restrain or 11 DOCSOC/1603063 v6/022245-0268 P592 enjoin the issuance or sale of the Bonds or in any way affecting any authority for or the validity of the Bonds, the Resolution, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate or this Bond Purchase Agreement or the existence of powers of the District; and (b) As of the Closing Date, the District shall receive the approving opinions of Bond Counsel referred to in Section 4(c)(6) hereof, dated as of the Closing Date, addressed to the District,together with a reliance letter addressed to the Underwriter. 6. Expenses. Whether or not the Bonds are delivered to the Underwriter as set forth herein: (a) The Underwriter shall be under no obligation to pay, and the District shall pay or cause to be paid (out of any legally available funds of the District) all expenses incident to the performance of the District's obligations hereunder, including, but not limited to, the cost of printing and delivering the Bonds to the Underwriter, the cost of preparation, printing (and/or word processing and reproduction), distribution and delivery of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate and all other agreements and documents contemplated hereby (and drafts of any thereof); the cost of printing the Preliminary Official Statement and the Official Statement in such reasonable quantities as requested by the Underwriter; and the fees and disbursements of the fiscal agent and registrar for the Bonds, Bond Counsel, the Escrow Agent, any accountants, engineers or any other experts or consultants the City or the District have retained in connection with the Bonds; and (b) The District shall be under no obligation to pay, and the Underwriter shall pay, the cost of preparation of any "blue sky" or legal investment memoranda and this Bond Purchase Agreement; expenses to qualify the Bonds for sale under any "blue sky" or other state securities laws; CDIAC fees and all other expenses incurred by the Underwriter in connection with their public offering and distribution of the Bonds (except those specifically enumerated in paragraph (a)of this section), including the fees and disbursements of its counsel and any advertising expenses. 7. Notices. Any notice or other communication to be given to the District under this Bond Purchase Agreement may be given by delivering the same in writing to the City of Rancho Cucamonga Community Facilities District No. 2003-01, c/o City of Rancho Cucamonga, 10500 Civic Center Drive, Rancho Cucamonga, California, 91730, Attention: City Manager; and any notice or other communication to be given to the Underwriter under this Bond Purchase Agreement may be given by delivering the same in writing to Stifel Nicolaus & Company, Incorporated dba Stone Youngberg, a Division of Stifel Nicolaus, One Ferry Building, Suite 275, San Francisco, California 94111, Attention: Jim Cervantes. 8. Parties in Interest. This Bond Purchase Agreement is made solely for the benefit of the District and the Underwriter (including their successors or assigns), and no other person shall acquire or have any right hereunder or by virtue hereof. 9. Survival of Representations and Warranties. The representations and warranties of the District set forth in or made pursuant to this Bond Purchase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing or termination of this Bond Purchase Agreement and regardless of any investigations made by or on behalf of the 12 DOCSOC/1603063 v6/022245-0268 P593 Underwriter (or statements as to the results of such investigations) concerning such representations and statements of the District and regardless of delivery of and payment for the Bonds. 10. Effective. This Bond Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the District and shall be valid and enforceable as of the time of such acceptance. This Bond Purchase Agreement may be signed in counterparts by each party. 11. No Prior Agreements. This Bond Purchase Agreement supersedes and replaces all prior negotiations, agreements and understandings between the parties hereto in relation to the sale of Bonds for the District. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 13 DOC SOC/1603063 v6/022245-0268 P594 12. Governing Law. This Purchase Contract shall be governed by the laws of the State of California. Very truly yours, STIFEL NICOLAUS & COMPANY, INCORPORATED By: Authorized Representative ACCEPTED: , 2013 at .m. COMMUNITY FACILITIES DISTRICT NO. 2003-01, IMPROVEMENT AREA NO. 1 OF THE CITY OF RANCHO CUCAMONGA By. City Manager 14 DOCSOC/1603063 v6/022245-0268 P595 EXHIBIT A MATURITY SCHEDULE CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 Maturity Date Principal (September 1) Amount Interest Rate Yield The purchase price of the Bonds shall be $ (representing the principal amount of the Bonds in the amount of $ less an Underwriter's discount of$ [plus/less] net original issue [premium/discount] of$ ). A-1 DOCSOC/1603063v6/022245-0268 P596 EXHIBIT B-1 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 I0b-5 CERTIFICATE OF FC VICTORIA GARDENS-C, INC. The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of FC Victoria Gardens-C, Inc., a California corporation (the "Property Owner"). (2) This Certificate is delivered in connection with the offering and sale of the bonds captioned above (the "Bonds"). (3) In connection with the offering and sale of the Bonds, there has been prepared a preliminary official statement, dated the date of this Certificate (the "Preliminary Official Statement'), setting forth certain information concerning, among other things, the Bonds, the Property Owner, LC Cucamonga Commercial, Inc. (together with the Property Owner, the "Tenants-in-Common") and Rancho Mall, LLC; the organization, activities, properties and financial condition of the Tenants-in-Common and Rancho Mall, LLC; and the property of the Tenants-in-Common and operations of Rancho Mall, LLC within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area"). (4) The sections in the Preliminary Official Statement that describe or relate to the Property Owner, the property of the Property Owner in the Improvement Area or representations made by the Property Owner (including "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 1 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Loan" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants- in-Common") contain no untrue statement of a material fact and do not omit any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (5) The Property Owner has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (6) Property Owner has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. B-1-1 DOC SOC/1603063 v6/022245-0268 P597 (7) The Property Owner is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by it and leased and operated by Rancho Mall, LLC or the ability of the Property Owner to pay its share of special taxes levied in the Improvement Area (the "Special Taxes"). (8) The Property Owner is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (9) There is no litigation or administrative proceeding of any nature in which the Property Owner has been served or, to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership and operation of the property owned by the Property Owner and leased and operated by Rancho Mall, LLC, or the ability of the Property Owner to pay its share of the Special Taxes. The information contained in this Certificate that is subject to the qualifier"to its knowledge" was obtained through (i) interviews with the officers and responsible employees of the Property Owner as the undersigned has reasonably determined are likely, in the ordinary course of his or her respective duties, to have knowledge of the matters set forth in this Certificate, and (ii) reviews of documents that were reasonably necessary for the undersigned to obtain knowledge of the matters set forth in this Certificate. Dated: [POS date] FC VICTORIA GARDENS-C, INC., a California corporation By: Name: Title: B-1-2 DOCSOC/1603063 v6/022245-0268 - P598 EXHIBIT B-2 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 10b-5 CERTIFICATE OF LC CUCAMONGA COMMERCIAL, INC. The undersigned, in connection with the issuance, sale and delivery by the City of Rancho The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of LC Cucamonga Commercial, Inc., a California corporation (the "Property Owner"). (2) This Certificate is delivered in connection with the offering and sale of the bonds captioned above (the "Bonds"). (3) In connection with the offering and sale of the Bonds, there has been prepared a preliminary official statement, dated the date of this Certificate (the "Preliminary Official Statement"), setting forth certain information concerning, among other things, the Bonds, the Property Owner, FC Victoria Gardens-C, Inc. (together with the Property Owner, the "Tenants-in-Common") and Rancho Mall, LLC; the organization, activities, properties and financial condition of the Tenants-in-Common and Rancho Mall, LLC; and the property of the Tenants-in-Common and operations of Rancho Mall, LLC within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area"). (4) The sections in the Preliminary Official Statement that describe or relate to the Property Owner, the property of the Property Owner in the Improvement Area or representations made by the Property Owner (including "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 1 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Loan" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants- in-Common") contain no untrue statement of a material fact and do not omit any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (5) The Property Owner has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (6) The Property Owner has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. B-2-1 DOCSOC/1603063 v6/022245-0268 P599 (7) The Property Owner is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by it and leased and operated by Rancho Mall, LLC or the ability of the Property Owner to pay its share of special taxes levied in the Improvement Area (the"Special Taxes"). (8) The Property Owner is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (9) There is no litigation or administrative proceeding of any nature in which the Property Owner has been served or, to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership and operation of the property owned by the Property Owner and leased and operated by Rancho Mall, LLC, or the ability of the Property Owner to pay its share of Special Taxes. The information contained in this Certificate that is subject to the qualifier"to its knowledge" was obtained through (i) interviews with the officers and responsible employees of the Property Owner as the undersigned has reasonably determined are likely, in the ordinary course of his or her respective duties, to have knowledge of the matters set forth in this Certificate, and (ii) reviews of documents that were reasonably necessary for the undersigned to obtain knowledge of the matters set forth in this Certificate. Dated: [POS date] LC CUCAMONGA COMMERCIAL, INC., a California corporation By: Name: Title: B-2-2 DOCSOC/1603063 v6/022245-0268 P600 EXHIBIT B-3 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 10b-5 CERTIFICATE OF RANCHO MALL, LLC The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of Rancho Mall, LLC, a Delaware limited liability company (the "Rancho Mail"). (2) This Certificate is delivered in connection with the offering and sale of the bonds captioned above (the "Bonds"). (3) In connection with the offering and sale of the Bonds, there has been prepared a preliminary official statement, dated the date of this Certificate (the "Preliminary Official Statement'), setting forth certain information concerning, among other things, the Bonds, Rancho Mall, FC Victoria Gardens-C, Inc. and LC Cucamonga Commercial, Inc. (together with the FC Victoria Gardens-C, Inc., the "Tenants-in-Common'); the organization, activities, properties and financial condition of Rancho Mall and Tenants-in-Common; and the property of the Tenants-in-Common and operations of Rancho Mall within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area"). (4) The sections in the Preliminary Official Statement that describe or relate to Rancho Mall, the property operated by Rancho Mall in the Improvement Area or representations made by Rancho Mall (including "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 1 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Load' and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants- in-Common') contain no untrue statement of a material fact and do not omit any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (5) Rancho Mall has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (6) Rancho Mall is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the operation of the property leased and operated by Rancho Mall. B-3-1 DOC SOC/1603063 v6/022245-0268 P601 (7) Rancho Mall is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (8) There is no litigation or administrative proceeding of any nature in which Rancho Mall has been served or, to its knowledge, is pending or threatened which, if successful, would materially adversely affect the operation of the property leased and operated by Rancho Mall. The information contained in this Certificate that is subject to the qualifier"to its knowledge" was obtained through (i) interviews with the officers and responsible employees of Rancho Mall as the undersigned has reasonably determined are likely, in the ordinary course of his or her respective duties, to have knowledge of the matters set forth in this Certificate, and (ii) reviews of documents that were reasonably necessary for the undersigned to obtain knowledge of the matters set forth in this Certificate. Dated: [POS date] [SIGNATURE BLOCK OF RANCHO MALL, LLC] By: Name: Title: B-3-2 DOCSOC/I603063 v6/022245-0268 P602 EXHIBIT C CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 FORM OF OPINION OF COUNSEL TO FC VICTORIA GARDENS-C, INC. AND LC CUCAMONGA COMMERCIAL, INC. One or more letters of counsel to FC Victoria Gardens-C, Inc., a California corporation, and LC Cucamonga Commercial, Inc., a California corporation (each, a "Property Owner") which, taken together, contain the following opinions: (1) Each Property Owner is a California corporation, duly formed, validly existing and in good standing under the laws of the State of California, and has full power and authority to enter into the Continuing Disclosure Certificate (Tenants-in-Common), dated , 2013 (the "TIC Disclosure Certificate"). (2) There are no legal or governmental actions, proceedings, inquiries or investigations pending or threatened or to which the property owned by the Property Owners in Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the 'Property") is subject, that, if determined adversely to either Property Owner, would individually or in the aggregate (a) have a material adverse effect on the financial position or results of operations of the Property Owner, considered as a whole, or (b) materially and adversely affect the ability of the Property Owner to complete the proposed development of the Property. (3) Each Property Owner has duly and validly executed and delivered the TIC Disclosure Certificate, and the TIC Continuing Disclosure Certificate constitutes the legal, valid and binding obligation of each Property Owner. (4) Based upon counsel's review of the Official Statement, and without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement, no facts came to our attention that would lead us to believe that the information in the section of the Official Statement relating to either Property Owner, Rancho Mall, LLC or Forest City Enterprises, Inc. and their respective organizations, activities, properties and financial condition, and their ownership or operation of the Property, contains any untrue statement of a material fact or omits any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. C-1 DOC SOC/1603063 v6/022245-0268 P603 EXHIBIT D-1 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. I SPECIAL TAX REFUNDING BONDS, SERIES 2013 CLOSING CERTIFICATE OF FC VICTORIA GARDENS-C,INC. The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of FC Victoria Gardens-C, Inc., a California corporation (the "Property Owner"). (2) The Property Owner is duly authorized to execute, deliver and perform the Continuing Disclosure Certificate (Tenants-in-Common) dated , 2013 in connection with the issuance of the Bonds (the "TIC Continuing Disclosure Certificate"). (3) The Property Owner has duly executed and delivered the TIC Continuing Disclosure Certificate. (4) The Property Owner has full power and authority to own, as a tenant-in- common with LC Cucamonga Commercial, Inc. (together with the Property Owner, the "Tenants-in-Common"), its property located within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area") and carry on its business as presently conducted. (5) Except as disclosed in the final official statement relating to the Bonds, dated 2013 (the "Final Official Statement"), no event has occurred since the date of the preliminary official statement relating to the Bonds, dated_, 2013, that has materially and adversely affected or is reasonably expected to materially and adversely affect the business, properties, operations or financial condition of the Property Owner. (6) Except as disclosed in the Final Official Statement, the Property Owner has not submitted an application for, nor received actual notice of (i) the formation or authorization of any assessment district or community facilities district that would include any portion of the land of the Tenants-in-Common within the Improvement Area, or (ii) the authorization or issuance of any debt secured by a special tax to be levied on any portion of the land of the Tenants-in-Common within the Improvement Area, other than the special taxes to be levied by the Issuer in the Improvement Area (the "Special Taxes"). (7) The representations and warranties made by the Property Owner in the I Ob-5 Certificate of FC Victoria Gardens-C, Inc., are true and correct in all material respects on the Closing Date, with the same effect as if made on the Closing Date. If at any time subsequent hereto and within 25 days after the date of this Certificate any statements related to the D-1-1 DOCSOC/1 603063 v6/022245-0268 P604 Property Owner, property of the Property Owner in the Improvement Area or representations made by the Property Owner contained in the sections of the Final Official Statement entitled "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 1 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Loan" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants-in-Common' become untrue, the Property Owner agrees to immediately notify the Issuer and Stifel, Nicolaus & Company, Incorporated, the underwriter of the Bonds. (8) The Property Owner covenants that, while the Bonds are outstanding, the Property Owner will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body which in any way seeks to challenge or overturn the Improvement Area, the levy of the Special Tax in accordance with the rate and method of apportionment of special tax for the Improvement Area (the "Rate and Method") or the validity of the Bonds or the proceedings leading up to their issuance. The foregoing covenant shall not prevent the Property Owner from bringing an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method. Dated: [closing date] FC VICTORIA GARDENS-C, INC., a California corporation By: Name: Title: D-1-2 DOCSOC/1603063 v6/022245-0268 P605 EXHIBIT D-2 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 CLOSING CERTIFICATE OF LC CUCAMONGA COMMERCIAL,INC. The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of LC Cucamonga Commercial, Inc., a California corporation (the"Property Owner"). (2) The Property Owner is duly authorized to execute, deliver and perform the Continuing Disclosure Certificate (Tenants-in-Common) dated , 2013 in connection with the issuance of the Bonds (the "TIC Continuing Disclosure Certificate"). (3) The Property Owner has duly executed and delivered the TIC Continuing Disclosure Certificate. (4) The Property Owner has full power and authority to own, as a tenant-in- common with FC Victoria Gardens-C, Inc. (together with the Property Owner, the "Tenants- in-Common"), its property located within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area") and carry on its business as presently conducted. (5) Except as disclosed in the final official statement relating to the Bonds, dated 2013 (the "Final Official Statement'), no event has occurred since the date of the preliminary official statement relating to the Bonds, dated , 2013, that has materially and adversely affected or is reasonably expected to materially and adversely affect the business, properties, operations or financial condition of the Property Owner. (6) Except as disclosed in the Final Official Statement, the Property Owner has not submitted an application for, nor received actual notice of, (i) the formation or authorization of any assessment district or community facilities district that would include any portion of the land of the Tenants-in-Common within the Improvement Area, or (ii) the authorization or issuance of any debt secured by a special tax to be levied on any portion of the land of the Tenants-in-Common within the Improvement Area, other than the special taxes to be levied by the Issuer in the Improvement Area(the "Special Taxes"). (7) The representations and warranties made by the Property Owner in the 1 Ob-5 Certificate of LC Cucamonga Commercial, Inc., are true and correct in all material respects on the Closing Date, with the same effect as if made on the Closing Date. If at any time subsequent hereto and within 25 days after the date of this Certificate any statements related D-2-1 DOCSOC/I603063v6/022245-0268 P606 to the Property Owner, property of the Property Owner contained in the Improvement Area or representations made by the Property Owner in the sections of the Final Official Statement entitled "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. I - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Loan" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants-in-Common" become untrue, the Property Owner agrees to immediately notify the Issuer and Stifel, Nicolaus & Company, Incorporated, the underwriter of the Bonds. (8) The Property Owner covenants that, while the Bonds are outstanding, the Property Owner will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body which in any way seeks to challenge or overturn the Improvement Area, the levy of the Special Tax in accordance with the rate and method of apportionment of special tax for the Improvement Area (the "Rate and Method") or the validity of the Bonds or the proceedings leading up to their issuance. The foregoing covenant shall not prevent the Property Owner from bringing an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method. Dated: [closing date] LC CUCAMONGA COMMERCIAL, INC., a California corporation By: Name: Title: D-2-2 DOCSOC/I603063 v6/022245-0268 P607 EXHIBIT D-3 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 CLOSING CERTIFICATE OF RANCHO MALL, LLC The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of Rancho Mall, LLC, a Delaware limited liability company (the "Rancho Mall"). (2) Rancho Mall has full power and authority to lease and operate property located within Improvement Area No. 1 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area") and carry on its business as presently conducted and as described in the Final Official Statement. (3) Except as disclosed in the final official statement relating to the Bonds, dated 2013 (the "Final Official Statement'), no event has occurred since the date of the preliminary official statement relating to the Bonds, dated , 2013, that has materially and adversely affected or is reasonably expected to materially and adversely affect the business, properties, operations or financial condition of Rancho Mall. (4) Except as disclosed in the Final Official Statement, Rancho Mall has not submitted an application for, nor received actual notice of (i) the formation or authorization of any assessment district or community facilities district that would include any portion of the land owned by FC Victoria Gardens-C, Inc. and LC Cucamonga Commercial, Inc. (collectively, the "Tenants-in-Common") within the Improvement Area, or (ii) the authorization or issuance of any debt secured by a special tax to be levied on any portion of the land of the Tenants-in-Common within the Improvement Area, other than the special taxes to be levied by the Issuer in the Improvement Area (the "Special Taxes"). (5) The representations and warranties made by Rancho Mall in the 10b-5 Certificate of Rancho Mall, LLC, are true and correct in all material respects on the Closing Date, with the same effect as if made on the Closing Date. If at any time subsequent hereto and within 25 days after the date of this Certificate any statements related to Rancho Mall, property operated by Rancho Mall in the Improvement Area or representations made by Rancho Mall contained in the sections of the Final Official Statement entitled "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 1 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership," "SPECIAL RISK FACTORS - Risks Associated with Commercial Real Estate Properties - Dependence on Tenants," "SPECIAL RISK FACTORS - Risks Associated with Private Load' and "CONTINUING DISCLOSURE - Continuing Disclosure D-3-1 DOCSOC/1603063v6/022245-0268 P608 Certificate of Tenants-in-Common" become untrue, Rancho Mall agrees to immediately notify the Issuer and Stifel, Nicolaus & Company, Incorporated, the underwriter of the Bonds. (6) Rancho Mall covenants that, while the Bonds are outstanding, Rancho Mall will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body which in any way seeks to challenge or overturn the Improvement Area, the levy of the Special Tax in accordance with the rate and method of apportionment of special tax for the Improvement Area (the "Rate and Method") or the validity of the Bonds or the proceedings leading up to their issuance. The foregoing covenant shall not prevent Rancho Mall from bringing an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method. Dated: [closing date] [SIGNATURE BLOCK OF RANCHO MALL, LLC] By: Name: Title: D-3-2 DOCSOC/1603063 v6/022245-0268 P609 6-20-13 Jones Hall Draft m PRELIMINARY OFFICIAL STATEMENT DATED ' 2013 mo .N NEW ISSUE-BOOK ENTRY ONLY NOT RATED c y 8 � F° Assuming compliance with certain covenants and provisions of the Internal Revenue Code of 1986, in the opinion of v Bond Counsel, interest on the 2013 Bonds will not be includable in gross income for federal income tax purposes although it may be includable in the calculation for certain taxes. Also in the opinion of Bond Counsel, interest on the 2013 Bonds will be exempt from State personal income taxes. See "TAX MATTERS." O � $14,355,000 CITY OF RANCHO CUCAMONGA F o COMMUNITY FACILITIES DISTRICT NO. 2003-01 u IMPROVEMENT AREA NO. 1 r h SPECIAL TAX REFUNDING BONDS, SERIES 2013 _ o H co_ Dated: Date of Issuance Due: September 1, as shown on inside cover y yo 2.o The City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District"), with respect to its ` Improvement Area No. 1 ("Improvement Area No. 1"), is issuing the above-captioned bonds(the"2013 Bonds")to (i) refund e o in full the City of Rancho Cucamonga Community Facilities District No.2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A (the "Prior Bonds"); (ii) fund a reserve fund for the 2013 Bonds; and (iii) pay the costs of issuing the 2013 o Bonds. See "PLAN OF REFUNDING." The Prior Bonds were issued by the District to finance various public infrastructure C y m� improvements located in the City. a _ 3 � The 2013 Bonds are being issued pursuant to a Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent o Agreement"), by and between the District and Wells Fargo Bank, National Association, as fiscal agent(the"Fiscal Agent"). °c a The 2013 Bonds are payable from the proceeds of an annual Special Tax (as defined in this Official Statement) being levied on property located within Improvement Area No. 1 (see "IMPROVEMENT AREA NO. 1"), and from certain funds pledged under the Fiscal Agent Agreement. The Special Tax is being levied according to a rate and method of c apportionment of Special Taxes approved in 2001 by the then-qualified electors of Improvement Area No. 1. See 5 "SECURITY FOR THE 2013 BONDS–Special Taxes"and Appendix B–'Rate and Method." m y nm Interest on the 2013 Bonds is payable on March 1 and September 1 of each year, commencing on September 1, 2013. o h The 2013 Bonds will be issued in book-entry form only and, when delivered,will be registered in the name of Cede&Co., as lb nominee of the Depository Trust Company, New York, New York("DTC"), which will act as securities depository for the 2013 o= Bonds. Individual purchases of the 2013 Bonds will be made in book-entry form only. Purchasers of the 2013 Bonds will not receive physical certificates representing their ownership interests in the 2013 Bonds purchased. The 2013 Bonds will be >w m issued in integral multiples of$5,000. Principal of and interest on the 2013 Bonds are payable directly to DTC by the Fiscal c y Agent. Upon receipt of payments of principal and interest, OTC will in turn distribute such payments to the beneficial owners w of the 2013 Bonds.See"THE 2013 BONDS' and Appendix F–"DTC and the Book-Entry Only System." t m v a The "Record Dale" of the 2013 Bonds is the 15th day of the month next preceding the month of the applicable Interest m Payment Date. m L o c The 2013 Bonds are subject to optional redemption and mandatory redemption from Special Tax Prepayments. See "THE 2013 BONDS—Redem tion." oc p c� t Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax =o N Revenues may be issued under the Fiscal Agent Agreement. sty NONE OF THE FAITH AND CREDIT OF THE DISTRICT, IMPROVEMENT AREA NO. 1, THE CITY OR THE STATE `c OF CALIFORNIA OR OF ANY OF THEIR RESPECTIVE POLITICAL SUBDIVISIONS IS PLEDGED TO THE PAYMENT OF E ro THE 2013 BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF THE 2013 BONDS. THE 2013 BONDS ARE NEITHER GENERAL OR SPECIAL OBLIGATIONS OF THE DISTRICT OR m 2 t IMPROVEMENT AREA NO. 1 NOR GENERAL OBLIGATIONS OF THE CITY, BUT ARE LIMITED OBLIGATIONS OF THE 16 DISTRICT WITH RESPECT TO IMPROVEMENT AREA NO. 1, PAYABLE SOLELY FROM CERTAIN AMOUNTS 'moo'o PLEDGED THEREFOR UNDER THE FISCAL AGENT AGREEMENT, AS MORE FULLY DESCRIBED IN THIS OFFICIAL STATEMENT. E m,co This cover page contains certain information for quick reference only. Investors should read the entire Official Statement d y m to obtain information essential to the making of an informed investment decision with respect to the 2013 Bonds. The y purchase of the 2013 Bonds involves significant risks, and the 2013 Bonds are not appropriate investments for all types of Is o Q investors. See "SPECIAL RISK FACTORS" in this Official Statement for a discussion of certain risk factors that should be considered, in addition to the other matters set forth in this Official Statement, in evaluating the investment quality of the 2013 Bonds. Preliminary; subject to change. P610 The 2013 Bonds are offered when, as and if issued, subject to approval as to their legality by Best Best& Krieger LLP, San Diego, California, Bond Counsel, and certain other conditions. Certain legal matters with respect to the 2013 Bonds will be passed upon for the District by the City Attorney, and for the District by Jones Hall,A Professional Law Corporation, San Francisco, California, acting as Disclosure Counsel. Certain legal matters will be passed upon for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. It is anticipated that the 2013 Bonds in definitive form will be available for delivery to DTC on or about July_,2013. [Stifel logo] The date of this Official Statement is ,2013. P611 MATURITY SCHEDULE $ Serial Bonds; CUSIP* Prefix 752117 Maturity Date Principal Interest CUSIP (September 1) Amount Rate Yield Suffix* Copyright 2013,American Bankers Association. CUSIP data is provided by Standard&Poor s CUSIP Service Bureau,a division of The McGraw-Hill Companies,Inc. None of the District,the City or the Underwriter assumes any responsibility for the accuracy of the CUSIP data. P612 CITY OF RANCHO CUCAMONGA City Council L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William J. Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member Other Elected Officials James C. Frost, City Treasurer Janice C. Reynolds, City Clerk City Staff John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Tamara L. Layne, Finance Director Lori E. Sassoon, Deputy City Manager/Administrative Services Ingrid Y. Bruce, GIS/Special Districts Manager James L. Markman, Esq., City Attorney PROFESSIONAL SERVICES Bond Counsel Best Best& Krieger LLP San Diego, California Disclosure Counsel Jones Hall, A Professional Law Corporation San Francisco, California Financial Advisor Feldman, Rolapp &Associates Irvine, California Special Tax Administrator David Taussig &Associates, Inc. Newport Beach, California Verification Agent Causey Demgen & Moore Inc. Denver, Colorado . Fiscal Agent and Escrow Bank Wells Fargo Bank, National Association Los Angeles, California P613 GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT The information contained in this Official Statement has been obtained from sources that are believed to be reliable. No representation, warranty or guarantee, however, is made by the Underwriter as to the accuracy or completeness of any information in this Official Statement, including, without limitation, the information contained in the Appendices, and nothing contained in this Official Statement should be relied upon as a promise or representation by the Underwriter. None of the District, City or Underwriter has authorized any dealer, broker, salesperson or other person to give any information or make any representations with respect to the offer or sale of the 2013 Bonds other than as contained in this Official Statement. If given or made, any such information or representations must not be relied upon as having been authorized by the District, City or Underwriter. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale of the 2013 Bonds shall under any circumstances create any implication that there has been no change in the affairs of any party described in this Official Statement, or in the status of any property described in this Official Statement, subsequent to the date as of which such information is presented. This Official Statement and the information contained in this Official Statement are subject to amendment without notice. The 2013 Bonds may not be sold, and no offer to buy the 2013 Bonds may be accepted, prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Official Statement constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the 2013 Bonds in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. When used in this Official Statement, in any continuing disclosure by the District or City, in any press release, or in any oral statement made with the approval of an authorized officer of the District or City or any other entity described or referenced in this Official Statement, the words or phrases "will likely result" "are expected to," "will continue," "is anticipated," "estimate," "project," "forecast," "expect," "intend" and similar expressions identify"forward looking statements"within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. Any forecast is subject to such uncertainties. Inevitably, some assumptions used to develop the forecasts will not be realized, and unanticipated events and circumstances may occur. Therefore, there are likely to be differences between forecasts and actual results, and those differences may be material. All summaries of the documents referred to in this Official Statement are qualified by the provisions of the respective documents summarized and do not purport to be complete statements of any or all of such provisions. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or the completeness of such information. In connection with the offering of the 2013 Bonds, the Underwriter may overallot or effect transactions that stabilize or maintain the market prices of the 2013 Bonds at levels above that which might otherwise prevail in the open market Such stabilizing, if commenced, may be discontinued at any time. The 2013 Bonds have not been registered under the Securities Act of 1933, as amended (the "Securities Act'), in reliance upon an exemption from the registration requirements contained in the Securities Act. The 2013 Bonds have not been registered or qualified under the securities laws of any state. The City maintains an Internet website, but the information it contains is not incorporated in this Official Statement. P614 [maps to come] P615 TABLE OF CONTENTS INTRODUCTION ........................................1 Land Owners ........................................ 32 General....................................................1 Delinquencies .......................................40 Authority for Issuance..............................1 Direct and Overlapping Governmental The 2013 Bonds......................................2 Obligations........................................ 44 Security for the 2013 Bonds....................2 Scheduled Debt Service Coverage.......47 Reserve Fund..........................................3 SPECIAL RISK FACTORS....................... 53 Improvement Area No. 1 .........................4 Concentration of Property Ownership... 53 Limited Obligation....................................5 Risks Associated with Commercial No Additional Bonds................................5 Real Estate Properties...................... 53 Bondowners' Risks..................................6 Impact of Zone Allocation ..................... 54 Continuing Disclosure .............................6 Payment of the Special Tax Is Not a Other Information ....................................6 Personal Obligation........................... 55 PLAN OF REFUNDING..............................6 No General Obligation of the City or Redemption of Prior Bonds.....................6 the District......................................... 55 Estimated Sources and Uses of Funds...7 Property Value...................................... 55 THE 2013 BONDS......................................7 Exempt Properties ................................ 56 Authority for Issuance..............................7 Parity Taxes and Special Assessments 56 General Provisions..................................8 Insufficiency of Special Taxes .............. 57 Redemption.............................................9 Tax Delinquencies ................................ 57 Transfer or Exchange of 2013 Bonds....10 Risks Associated with Private Loan...... 58 Discontinuance of DTC Services...........11 Bankruptcy Delays................................ 58 Scheduled Debt Service........................12 Proceeds of Foreclosure Sales............. 58 SECURITY FOR THE 2013 BONDS........13 Natural Disasters .................................. 59 General..................................................13 Hazardous Substances.........................61 Limited Obligation..................................13 Disclosure to Future Purchasers ..........61 Special Taxes........................................13 FDIC/Federal Government Interests in Special Tax Fund ..................................14 Properties..........................................62 Summary of Rate and Method ..............16 No Acceleration Provision.....................63 Reserve Fund........................................19 Taxability Risk.......................................64 Covenant for Superior Court Enforceability of Remedies...................64 Foreclosure........................................19 No Secondary Market........................... 64 No Teeter Plan......................................20 Proposition 218.....................................65 Investment of Moneys...........................21 Ballot Initiatives..................................... 66 No Additional Bonds..............................21 TAX MATTERS ........................................66 IMPROVEMENT AREA NO. 1 ..................22 LEGAL MATTERS.................................... 67 Location and Description of NO RATING .............................................67 Improvement Area No. 1 ...................22 LITIGATION .............................................68 Land Use Distribution............................24 UNDERWRITING..................................... 68 Assessed Property Values....................26 CONTINUING DISCLOSURE ..................68 Value-to-Debt Burden Ratio..................28 MISCELLANEOUS................................... 70 APPENDIX A CITY OF RANCHO CUCAMONGA GENERAL DEMOGRAPHIC INFORMATION APPENDIX B RATE AND METHOD APPENDIX C SUMMARY OF THE FISCAL AGENT AGREEMENT APPENDIX D FORM OF OPINION OF BOND COUNSEL APPENDIX E FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE APPENDIX F FORM OF TIC CONTINUING DISCLOSURE CERTIFICATE APPENDIX G DTC AND THE BOOK-ENTRY ONLY SYSTEM APPENDIX H VICTORIA GARDENS MALL TENANT ROSTER P616 [Intentionally Left Blank] P617 OFFICIAL STATEMENT $14,355,000` CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 INTRODUCTION This introduction is not a summary of this Official Statement and is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement by those interested in purchasing the 2013 Bonds. The sale and delivery of 2013 Bonds to potential investors is made only by means of the entire Official Statement. Certain capitalized terms used in this Official Statement and not defined have the meaning set forth in Appendix C– "Summary of the Fiscal Agent Agreement—Definitions"and in Appendix B– "Rate and Method." General The purpose of this Official Statement, which includes the cover page, the inside cover page, the table of contents and the attached appendices (the "Official Statement'), is to provide certain information concerning the issuance of the above-captioned bonds (the "2013 Bonds"). The 2013 Bonds are being issued by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District') with respect to its Improvement Area No. 1 ('Improvement Area No. 1"), to (i) refund in full the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Special Tax Bonds, Series 2003-A currently outstanding in the aggregate principal amount of$14,215,000 (the "Prior Bonds"); (ii) fund a reserve fund for the 2013 Bonds; and (iii) pay the costs of issuing the 2013 Bonds. See "PLAN OF REFUNDING." The Prior Bonds were issued to finance various public infrastructure improvements (the "Improvements") within the City of Rancho Cucamonga, California (the "City"). Authority for Issuance General. The District and Improvement Area No. 1 were formed under the authority of the Mello-Roos Community Facilities Act of 1982, as amended, commencing at Section 53311, et seq., of the California Government Code (the "Act'), which was enacted by the California Legislature to provide an alternative method of financing certain public capital facilities and services, especially in developing areas of the State. The Act authorizes local governmental entities to establish community facilities districts as legally constituted governmental entities within defined boundaries, with the legislative body of the local applicable governmental entity acting on behalf of the district. Subject to approval by at least a two-thirds vote of the votes cast Preliminary, subject to change. P618 by the qualified electors within a district and compliance with the provisions of the Act, the legislative body may issue bonds for the community facilities district established by it and may levy and collect a special tax within such district to repay such bonds. Bond Authority. The 2013 Bonds are authorized to be issued pursuant to the Act, a resolution adopted on July 3, 2013 by the City Council of the City (the "City Council") acting as the legislative body of the District, and the Fiscal Agent Agreement dated as of July 1, 2013 (the "Fiscal Agent Agreement'), between the District and Wells Fargo Bank, National Association, as fiscal agent (the "Fiscal Agent'). For more detailed information about the formation of the District and Improvement Area No. 1, the authority for issuance of the Prior Bonds and the authority for issuance of the 2013 Bonds, see "THE 2013 BONDS –Authority for Issuance." The 2013 Bonds General. The 2013 Bonds will be issued only as fully registered bonds, in integral multiples of $5,000, and will bear interest at the rates per annum and will mature on the dates and in the principal amounts set forth on the inside cover page of this Official Statement. The 2013 Bonds will be dated the date of their issuance and interest on the 2013 Bonds, will be payable on March 1 and September 1 of each year (individually an 'Interest Payment Date"), commencing September 1, 2013. See `THE 2013 BONDS." Book Entry-Only System. The 2013 Bonds will be issued in book-entry form only and, when delivered, will be registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York, New York ("DTC"), which will act as securities depository for the 2013 Bonds. See 'THE 2013 BONDS—General Provisions." Redemption Prior to Maturity. The 2013 Bonds are subject to optional redemption and mandatory redemption from Special Tax prepayments. See "THE 2013 BONDS– Redemption." Security for the 2013 Bonds Pledge Under the Fiscal Agent Agreement. Pursuant to the Fiscal Agent Agreement, the 2013 Bonds are secured by a first pledge of all of the Special Tax Revenues (other than, in each Fiscal Year, up to the first $_,000 of Special Tax Revenues that may be deposited into the Administrative Expense Fund) and all moneys deposited in the Bond Fund and, until disbursed in accordance with the Fiscal Agent Agreement, in the Special Tax Fund, except for moneys on deposit in the Penalties and Interest Account (which constitute any penalties or interest in excess of the interest payable on the 2013 Bonds collected in connection with delinquent Special Taxes). The 2013 Bonds are further secured by a first pledge of all monies deposited into the Reserve Fund. "Special Tax Revenues," as defined in the Fiscal Agent Agreement, means the proceeds of the Special Taxes received by the District including any scheduled payments and any prepayments, related interest and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest and penalties, but does not include interest and penalties, if any, collected in connection with delinquent Special Taxes. The Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2013 Bonds in accordance with the Fiscal Agent Agreement and the Act until all the 2013 Bonds have been 2 P619 paid and retired or defeased. See "SECURITY FOR THE 2013 BONDS—Special Taxes" and Appendix B —"Rate and Method." Amounts in the Administrative Expense Fund and the Costs of Issuance Fund, each of which is established under the Fiscal Agent Agreement, are neither pledged to nor available for the repayment of the 2013 Bonds. Proceeds of the 2013 Bonds and other amounts deposited into the Escrow Fund under the Escrow Agreement(see 'PLAN OF REFUNDING — Redemption of Prior Bonds") are not pledged to, and will not be available for, the payment of the 2013 Bonds. Special Taxes; Rate and Method. The Special Taxes to be used to pay debt service on the 2013 Bonds will be levied in accordance with the 'Rate and Method" of apportionment of Special Tax (as described under the heading "THE 2013 BONDS — Authority for Issuance"). "Special Taxes" are those taxes levied on the Taxable Property within Improvement Area No. 1 pursuant to the Rate and Method and the Fiscal Agent Agreement. The Rate and Method includes the following relevant definitions, among others: "Taxable Property" is defined as all of the parcels within the boundaries of Improvement Area No. 1 that are not exempt from the Special Tax pursuant to law or the Rate and Method. "Developed Property" is defined as, for each Fiscal Year, all Taxable Property which (i) was within a Final Map that was recorded prior to January 1 of the previous Fiscal Year, and (ii) for which a building permit for new construction, other than the construction of a garage, parking lot, parking structure or street, was issued after January 1, 2002 but prior to January 1 of the previous Fiscal Year. "Undeveloped Property" is defined as, for each Fiscal Year, all Taxable Property not classified as Developed Property. Limitations. The Improvements are not pledged as collateral for the 2013 Bonds. The proceeds of condemnation or destruction of any of the Improvements are not pledged to pay the debt service on the 2013 Bonds. In the event that the Special Taxes are not paid when due, the only sources of funds available to repay the 2013 Bonds are amounts held by the Fiscal Agent under the Fiscal Agent Agreement in the Bond Fund, the Special Tax Fund and the Reserve Fund, and the proceeds, if any, from foreclosure sales of parcels with delinquent Special Taxes. Reserve Fund The Fiscal Agent Agreement establishes a Reserve Fund to be held by the Fiscal Agent as a reserve for the payment of principal of and interest on the 2013 Bonds. The Reserve Fund is required to be funded in an amount equal to the 'Reserve Requirement," which means on any date in any Bond Year the lesser of (i) 10% of the stated principal amount of the 2013 Bonds, (ii) Maximum Annual Debt Service on the 2013 Bonds or (iii) 125% of average Annual Debt Service on the 2013 Bonds, as determined by the District. The Reserve Requirement as of the date of issuance of the 2013 Bonds will be $ 3 P620 Improvement Area No. 1 Three Zones. Improvement Area No. 1 consists of approximately 147 gross acres that are primarily built-out. The Rate and Method divides the Taxable Property within Improvement Area No. 1 into three zones: "Zone 1," "Zone 2" and "Zone 3," each of which is referred to in this Official Statement as a "Zone." The Rate and Method allocates a portion of the outstanding 2013 Bonds to each Zone for purposes of determining the amount of the Special Taxes to be levied. Zone Allocations. Each Zone is responsible only for debt service on the percentage of any outstanding 2013 Bonds allocated to it (its "Zone Allocation"), and Special Taxes may not be levied in one Zone in order to provide amounts to pay debt service on outstanding 2013 Bonds allocated to another. The Zone Allocations are specified in the Rate and Method and discussed in the paragraphs that follow. Zone 1 Allocation. The Zone Allocation for Zone 1 is 6.72% of the initial principal amount of the 2013 Bonds (or $972,720). On the 2012-13 property tax roll, the San Bernardino County ("County") Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 1 (see 'IMPROVEMENT AREA NO. 1") at $69,180,921. The table below provides certain information about the parcels contained in Zone 1 as of January 1, 2013. % Responsibility for Number of Classification under Fiscal Year 2013-14 Parcels Use Rate and Method Special Tax within Zone 215 Residential Developed 100% 11' NIA Undeveloped 0 216 (1) See"IMPROVEMENT AREA NO. 1 — Location and Description of Improvement Area No. 1" for a description of this parcel which is currently owned by the Successor Agency of the Former Rancho Cucamonga Redevelopment Agency. Zone 2 Allocation. The Zone Allocation for Zone 2 is 81.74% of the initial principal amount of the 2013 Bonds (or $11,831,865 ). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 2 (see `IMPROVEMENT AREA NO. 1") at $230,387,001. Preliminary;subject to change. 4 P621 The table below provides certain information about the taxable parcels contained in Zone 2 as of January 1, 2013. % Responsibility for Number of Classification under Fiscal Year 2013-14 Parcels Use Rate and Method Special Tax within Zone 4 Commercial Developed 100% 1 Commercial Undeveloped 0 5 Zone 3 Allocation. The Zone Allocation for Zone 3 is 11.54% of the initial principal amount of the 2013 Bonds (or $1,670,415). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 3 (see "IMPROVEMENT AREA NO. 1") at $48,886,211. As of January 1, 2013, Zone 3 contained 14 commercial parcels, all of which are classified as Developed Property under the Rate and Method. For Fiscal Year 2013-14, the parcels are responsible for 100% of the Special Taxes within the Zone. The value of individual parcels varies significantly. In addition, County-assessed values may not reflect current market values. No recent independent appraisal of the property subject to the levy of Special Taxes has been conducted in connection with the 2013 Bonds, and no assurance can be given that should Special Taxes levied on one or more of the parcels become delinquent, and should the delinquent parcels be offered for sale at a judicial foreclosure sale, that any bid would be received for the property or, if a bid is received, that such bid would be sufficient to pay such parcel's delinquent Special Taxes. See "IMPROVEMENT AREA NO. 1," "SPECIAL RISK FACTORS—Property Value" and "SPECIAL RISK FACTORS—Insufficiency of Special Taxes." Limited Obligation NONE OF THE FAITH AND CREDIT OF THE DISTRICT, IMPROVEMENT AREA NO. 1, THE CITY OR THE STATE OF CALIFORNIA OR OF ANY OF THEIR RESPECTIVE POLITICAL SUBDIVISIONS IS PLEDGED TO THE PAYMENT OF THE 2013 BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF THE 2013 BONDS. THE 2013 BONDS ARE NEITHER GENERAL OR SPECIAL OBLIGATIONS OF THE DISTRICT OR IMPROVEMENT AREA NO. 1 NOR GENERAL OBLIGATIONS OF THE CITY, BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT WITH RESPECT TO IMPROVEMENT AREA NO. 1 PAYABLE SOLELY FROM CERTAIN AMOUNTS PLEDGED THEREFOR UNDER THE FISCAL AGENT AGREEMENT, AS MORE FULLY DESCRIBED IN THIS OFFICIAL STATEMENT. No Additional Bonds Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax Revenues may be issued under the Fiscal Agent Agreement. 5 P622 Bondowners' Risks Certain events could affect the ability of the District to pay the principal of and interest on the 2013 Bonds when due. Except for the Special Taxes, no other taxes are pledged to the payment of the 2013 Bonds. See "SPECIAL RISK FACTORS" for a discussion of certain factors that should be considered in evaluating an investment in the 2013 Bonds. The purchase of the 2013 Bonds involves significant risks, and the 2013 Bonds are not appropriate investments for all types of investors. Continuing Disclosure For purposes of complying with Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934, as amended (the "Rule'), the City, on behalf of itself and the District, has agreed to provide, or cause to be provided, to the Municipal Securities Rulemaking Board (the WSRB") certain annual financial information and operating data and notice of certain significant events. In addition, FC Victoria Gardens-C, Inc., a California corporation ("FC-C"), and LC Cucamonga Commercial, Inc., a California corporation ("LC" and, together with, FC-C, the "Tenants-in-Common"), the owners of the real property in Zone 2 developed as Victoria Gardens Mall, have agreed to provide, or cause to be provided, to the MSRB certain information relating to themselves and the parcels they own within Improvement Area No. 1 and notice of certain significant events. The City and Tenants-in-Common will each make the covenants described above in continuing disclosure certificates, to be dated the date of delivery of the 2013 Bonds, in order to assist the Underwriter in complying with the Rule. See "CONTINUING DISCLOSURE" for more information about these certificates (the forms of which are attached to this Official Statement as Appendices E and F) or the parties' recent compliance with their respective existing continuing disclosure obligations. Other Information This Official Statement speaks only as of its date, and the information contained in this Official Statement is subject to change without notice. Except where otherwise indicated, all information contained in this Official Statement has been provided by the City on behalf of the District. Copies of the Fiscal Agent Agreement and certain other documents referenced in this Official Statement are available for inspection at the office of, and (upon written request and payment to the City of a charge for copying, mailing and handling) are available for delivery from, the City Clerk of the City, 10500 Civic Center Drive, Rancho Cucamonga, California 91730. PLAN OF REFUNDING Redemption of Prior Bonds A portion of the proceeds of the sale of the 2013 Bonds, together with available funds held under the Fiscal Agent Agreement, dated as of July 1, 2003, with respect to the Prior 6 P623 Bonds (the "2003 Fiscal Agent Agreement"), will be deposited in an escrow account (the "Escrow Fund") held by Wells Fargo Bank, National Association, as escrow bank (the "Escrow Bank") pursuant to an Escrow Agreement dated as of July 1, 2013, among the City, District and Escrow Bank. The moneys in the Escrow Fund will be held uninvested or invested in federal securities. The moneys in the Escrow Fund will be applied to defease and refund all the outstanding Prior Bonds. Amounts in the escrow fund will be sufficient, without reinvestment, to fully pay the Prior Bonds on September 1, 2013, at a redemption price of 100% of the principal amount thereof plus accrued interest to the redemption date. Upon such irrevocable deposit with the Escrow Bank in accordance with the Escrow Agreement, the Prior Bonds will be legally defeased and no longer be entitled to the benefits of, or be secured by, the 2003 Fiscal Agent Agreement or any pledge of, or lien on, the Special Taxes levied in Improvement Area No. 1. Amounts deposited in the Escrow Fund are not in any way available to pay debt service on the 2013 Bonds. Estimated Sources and Uses of Funds The sources and uses of funds in connection with the 2013 Bonds are expected to be as follows: Principal of 2013 Bonds Less: Original Issue Discount Amounts relating to the Prior Bonds Total Sources Deposit to Escrow Fund') Deposit to Reserve Fund(2) Deposit to Costs of Issuance Fund(3) Underwriter's Discount Total Uses (1) See"—Redemption of Prior Bonds." (2) Equal to the initial Reserve Requirement. See "SECURITY FOR THE 2013 BONDS—Reserve Fund." (3) Costs of issuance include, without limitation, the City's transaction fee, Fiscal Agent fees and expenses; Financial Advisor fees and expenses; Bond Counsel, Disclosure Counsel and other legal fees; Special Tax Administrator fees and expenses; Verification Agent fees; Escrow Bank fees and expenses; and printing costs. THE 2013 BONDS Authority for Issuance Pursuant to the Act, on February 19, 2003, the City Council adopted Resolution No. 03- 031 establishing the District and designating Improvement Area No. 1 (the "Resolution of Formation"). Also on February 19, 2003, the City Council adopted Resolution No. 03-032, 7 P624 declaring the necessity to incur a bonded indebtedness of $16,000,000 within Improvement Area No. 1. On February 19, 2003, the then-eligible landowner voters of Improvement Area No. 1, by more than a two-thirds majority, authorized the issuance of bonded indebtedness to finance the authorized public facilities, and approved the 'Rate and Method of Apportionment for Community Facilities District No. 2003-01 of the City of Rancho Cucamonga Improvement Area No. 1" (the "Rate and Method"), a copy of which is attached to this Official Statement as Appendix B. The 2013 Bonds are authorized to be issued pursuant to the Act, Resolution No. adopted on July 3, 2013, by the City Council, acting as the legislative body of the District, and the Fiscal Agent Agreement. The Special Taxes to be used to pay debt service on the 2013 Bonds will be levied in accordance with the Rate and Method. General Provisions The 2013 Bonds will be issued only as fully registered 2013 Bonds, in integral multiples of$5,000, and will bear interest at the rates per annum and will mature on the dates set forth on the inside cover page of this Official Statement. The 2013 Bonds will be dated the date of their issuance and interest will be payable on each Interest Payment Date, commencing September 1, 2013. Each Bond will bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (i) it is authenticated on an Interest Payment Date, in which event it will bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it will bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it will bear interest from the Closing Date; provided, however, that if at the time of authentication of a 2013 Bond, interest is in default on it, such 2013 Bond will bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment. The Record Date for the 2013 Bonds is defined in the Fiscal Agent Agreement as the fifteenth day of the month next preceding the month of the applicable Interest Payment Date. The 2013 Bonds will be payable both as to principal and interest, and as to any premiums upon the redemption thereof, in lawful money of the United States of America. The principal of the 2013 Bonds and any premiums due upon redemption will be payable upon presentation and surrender at the principal corporate trust office of the Fiscal Agent. Interest with respect to each Bond will be computed using a year of 360 days comprised of twelve 30- day months. The 2013 Bonds will be issued in book-entry form only and, when delivered, will be registered in the name of Cede & Co., as nominee of DTC, which will act as securities depository for the 2013 Bonds. Individual purchases of the 2013 Bonds will be made in book- entry form only. Purchasers of the 2013 Bonds will not receive physical certificates representing their ownership interests in the 2013 Bonds purchased. Principal and interest payments represented by the 2013 Bonds are payable directly to DTC by the Fiscal Agent. Upon receipt of payments of principal and interest; DTC will in turn distribute such payments to the beneficial owners of the 2013 Bonds. See Appendix G — "DTC and the Book-Entry Only System." So 8 P625 long as the 2013 Bonds are registered in the name of Cede & Co., as nominee of DTC, references in this Official Statement to the owners shall mean Cede & Co., and shall not mean the purchasers or Beneficial Owners of the 2013 Bonds. Redemption Optional Redemption. The 2013 Bonds maturing on and after September 1, 2024 may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of$5,000) on any Interest Payment Date beginning September 1, 2023, from such maturities as are selected by the District, and by lot within a maturity, at a redemption price equal to the principal amount of the 2013 Bonds to be redeemed, plus accrued interest to the date fixed for redemption, without premium. Redemption Date Redemption Price September 1, 20_through September 1, 20_ 10_% March 1, 20 and September 1, 20_ 10_ March 1, 26— September 1, 20_ 10_ March 1, 20_and any Interest Payment Date thereafter 100 Mandatory Redemption From Special Tax Prepayments. The 2013 Bonds will be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the 2013 Bonds to be redeemed), together with accrued interest to the date of redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20_ 103% March 1, 20_and September 1, 20_ 102 March 1, 20_and September 1, 20_ 101 March 1, 20_and on any Interest Payment Date thereafter 100 Purchase of 2013 Bonds In Lieu of Redemption. In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2013 Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may 2013 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the 2013 Bonds. Selection of 2013 Bonds for Redemption. Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all the 2013 Bonds or any given portion thereof, the Fiscal Agent will select the 2013 Bonds to be redeemed, from all 2013 Bonds or such given portion thereof not previously called for redemption, among maturities as specified by the District in a written certificate delivered to the Fiscal Agent, and by lot within a maturity in any manner which the District in its sole discretion shall deem appropriate and fair. In providing 9 P626 such certificate, the District shall provide for the redemption of 2013 Bonds such that the remaining Debt Service payable on the 2013 Bonds shall remain level as possible. Notice of Redemption. The Fiscal Agent will cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 30 days but not more than 60 days prior to the date fixed for redemption, to the respective registered Owners of any 2013 Bonds designated for redemption, at their addresses appearing on the 2013 Bond registration books in the Principal Office of the Fiscal Agent; but such mailing will not be a condition precedent to such redemption, and failure to mail or to receive any such notice, or any defect in the notice, will not affect the validity of the proceedings for the redemption of such 2013 Bonds. Such notice will state the redemption date and the redemption price and, if less than all of the then Outstanding 2013 Bonds are to be called for redemption, will designate the 2013 Bond numbers of the 2013 Bonds to be redeemed by giving the individual 2013 Bond number of each 2013 Bond to be redeemed or will state that all 2013 Bonds between two stated 2013 Bond numbers, both inclusive, are to be redeemed or that all of the 2013 Bonds of one or more maturities have been called for redemption, will state as to any 2013 Bond called in part the principal amount thereof to be redeemed, and will require that such 2013 Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and will state that further interest on such 2013 Bonds will not accrue from and after the redemption date. Conditional Notice. The District will have the right to rescind any notice of redemption for any redemption of 2013 Bonds, as described above under "- Optional Redemption" or "- Mandatory Redemption from Special Tax Prepayments," on or prior to the date fixed for redemption. Any notice of optional redemption will be cancelled and annulled if for any reason funds will not be or are not available on the date so fixed for redemption for the payment in full of the 2013 Bonds then called for redemption, and such cancellation will not constitute an event of default under the Fiscal Agent Agreement. The Fiscal Agent will have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent will mail notice of such recession of redemption in the same manner as the original notice of redemption. Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2013 Bonds so called for redemption will have been deposited in the Bond Fund, such 2013 Bonds so called will cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue on or after the redemption date specified in such notice. Transfer or Exchange of 2013 Bonds So long as the 2013 Bonds are registered in the name of Cede & Co., as nominee of DTC, transfers and exchanges of 2013 Bonds will be made in accordance with DTC procedures. See Appendix G — "DTC and the Book-Entry Only System." If the book-entry only system for the 2013 Bonds is ever discontinued, any Bond may, in accordance with its terms, be transferred or exchanged by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. Whenever any 2013 Bond or 2013 Bonds are surrendered for transfer or exchange, the District will execute and the Fiscal Agent will authenticate and deliver a new 2013 Bond or 2013 Bonds, for a like aggregate 10 P627 principal amount of 2013 Bonds of authorized denominations and of the same maturity. The Fiscal Agent will collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfers of 2013 Bonds will be required to be made (i) 15 days prior to the date established by the Fiscal Agent for selection of 2013 Bonds for redemption; (ii) with respect to a 2013 Bond after such 2013 Bond has been selected for redemption; or (iii) between the Record Date with respect to an Interest Payment Date, and that Interest Payment Date. Discontinuance of DTC Services DTC may determine to discontinue providing its services with respect to the 2013 Bonds at any time by giving written notice to the Fiscal Agent during any time that the 2013 Bonds are Outstanding, and discharging its responsibilities with respect to the 2013 Bonds under applicable law. The District may terminate the services of DTC with respect to the 2013 Bonds if it determines that DTC is unable to discharge its responsibilities with respect to the 2013 Bonds or that continuation of the system of book-entry transfers through DTC is not in the best interest of the Beneficial Owners. The District will mail any such notice of termination to the Fiscal Agent. Upon the termination of the services of DTC as provided in the previous paragraph, and if no substitute Depository willing to undertake the functions can be found which is willing and able to undertake such functions upon reasonable or customary terms, or if the District determines that it is in the best interest of the Beneficial Owners of the 2013 Bonds that they obtain certificated Bonds, the 2013 Bonds will no longer be restricted to being registered in the Registration Books of the Fiscal Agent in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or name the Owners designate at that time, in accordance with the Fiscal Agent Agreement. To the extent that the Beneficial Owners are designated as the transferee by the Owners, the 2013 Bonds will be delivered to such Beneficial Owners as soon as practicable in accordance with the Fiscal Agent Agreement. 11 P628 Scheduled Debt Service The following is the debt service schedule for the 2013 Bonds, assuming no optional redemption of the 2013 Bonds or redemption of the 2013 Bonds from Special Tax Prepayments: Period Ending September 1 Principal Interest Total Debt Service 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Totals 12 P629 SECURITY FOR THE 2013 BONDS General Pursuant to the Fiscal Agent Agreement, the 2013 Bonds are secured by a first pledge of and lien upon all of the Special Tax Revenues (other than, each Fiscal Year, a maximum of $_,000 of Special Tax Revenues that may be deposited into the Administrative Expense Fund on a priority basis) and all moneys deposited in the Bond Fund and, until disbursed in accordance with the Fiscal Agent Agreement, the Special Tax Fund, except for monies on deposit in the Penalties and Interest Account. The 2013 Bonds are further secured by a first pledge of all monies deposited into the Reserve Fund. Special Tax Revenues do not include interest and penalties on foreclosure of the lien of Special Taxes in excess of the interest payable on the 2013 Bonds. The Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2013 Bonds in accordance with the Fiscal Agent Agreement and the Act until all the 2013 Bonds have been paid and retired or defeased. Amounts in the Administrative Expense Fund, the Costs of Issuance Fund and the Escrow Fund, and a maximum of the first $_,000 of Special Tax Revenues collected in any Fiscal Year that may be deposited into the Administrative Expense Fund on a priority basis, are not pledged to the repayment of the 2013 Bonds. The Improvements are not pledged as collateral for the 2013 Bonds. The proceeds of condemnation or destruction of any of the Improvements are not pledged to pay the Debt Service on the 2013 Bonds. Limited Obligation The 2013 Bonds are limited obligations of the District with respect to Improvement Area No. 1 and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Bond Fund, the Reserve Fund and the Special Tax Fund created pursuant to the Fiscal Agent Agreement. Also, each Zone of Improvement Area No. 1 is responsible only for debt service on the outstanding 2013 Bonds allocated to it. See "- Summary of Rate and Method - Effect of Zone Allocation." In the event that the Special Taxes are not paid when due, the only sources of funds available to repay the 2013 Bonds are amounts held by the Fiscal Agent under the Fiscal Agent Agreement in the Bond Fund, Special Tax Fund and Reserve Fund, and the proceeds, if any, from foreclosure sales of parcels with delinquent Special Tax levies. Special Taxes In accordance with the provisions of the Act, the Rate and Method was approved in 2003 by the then-qualified electors of Improvement Area No. 1 and is set forth in its entirety in Appendix B. Under the Fiscal Agent Agreement, the District is obligated to fix and levy the amount of Special Taxes within Improvement Area No. 1 required for the timely payment of principal of and interest on the outstanding 2013 Bonds becoming due and payable, including any necessary replenishment of the Reserve Fund and an amount estimated to be sufficient to pay the Administrative Expenses, taking into account any prepayments of Special Taxes previously received by the District. The Special Taxes levied on any parcel of Taxable Property (as defined in "—Summary of Rate and Method") may not exceed the maximum amount as provided in the Rate and Method. 13 P630 The Special Taxes are payable and are to be collected in the same manner, at the same time and in the same installment as County ad valorem taxes on property levied on the secured tax roll are payable, and pursuant to the Act have the same priority, become delinquent at the same times and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the taxes levied on the tax roll. Although the Special Taxes will constitute a lien on taxed parcels within Improvement Area No. 1, they do not constitute a personal indebtedness of the owners of the property within Improvement Area No. 1. Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of the Special Tax on a parcel of Taxable Property, the District may order the institution of a superior court action to foreclose the lien on the parcel of Taxable Property within specified time limits. In such an action, the real property subject to the unpaid amount of the Special Tax lien may be sold at judicial foreclosure sale. The Act provides that the Special Taxes are secured by a continuing lien that is subject to the same lien priority in the case of delinquency as ad valorem property taxes. See "—Summary of Rate and Method," "- Covenant for Superior Court Foreclosure" and "SPECIAL RISK FACTORS—Parity Taxes and Special Assessments." Other liens for taxes and assessments may already exist on the property located within Improvement Area No. 1 and others could come into existence in the future. See "SPECIAL RISK FACTORS—Parity Taxes and Special Assessments." There is no assurance that any owner of a parcel subject to the Special Tax levy will be financially able to pay the annual Special Taxes or that it will pay such taxes even if financially able to do so. See "SPECIAL RISK FACTORS." For historic information regarding assessed valuations and the payment of, or delinquencies with respect to, Special Taxes in Improvement Area No. 1, see "IMPROVEMENT AREA NO. 1." Special Tax Fund Deposit of Special Tax Revenues. The Special Tax Fund is established under the Fiscal Agent Agreement as a separate fund to be held by the Fiscal Agent, to the credit of which the District or the City, on behalf of the District, will deposit, immediately upon receipt, all Special Tax Revenue received by the District or the City, on behalf of the District. The Special Tax Revenues deposited in the Special Tax Fund will be held and, other than Special Tax Revenues representing Prepayments, subsequently transferred to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 1. to the District for deposit in Administrative Expense Fund an amount equal to the Priority Administrative Expense Amount estimated to be due and payable during the Fiscal Year; 2. not later than 10 Business Days prior to each Interest Payment Date, to the Bond Fund: 14 P631 a. the amount representing past due installments of principal, interest and premium on the 2013 Bonds (including any interest), if any, resulting from the delinquency in the payment of such Special Taxes; and b. an amount, taking into account any amounts then on deposit in the Bond Fund (other than by reason of the preceding paragraph a.) such that the amount in the Bond Fund equals the principal, premium, if any, and interest due on the 2013 Bonds on the next Interest Payment Date; 3. no later than 10 Business Days prior to each Interest Payment Date, to the Reserve Fund that amount, in addition to the amount transferred to the Bond Fund pursuant to paragraph 2. above, necessary to replenish any draw on the Reserve Fund; 4. on September 2 of each year after making the deposits and transfers required under paragraphs 1 and 2 above and the transfer, if any, authorized under paragraph 3 above, to the Rebate Fund, upon receipt of written instructions from an Authorized Officer on or before the preceding June 30, the amount specified in such written instructions necessary for the payment of any rebate amount due and owing to the United States of America by the District on the 2013 Bonds; 5. on September 2 of each year after making the deposits and transfers required under paragraphs 1 through 4 above, upon receipt of written instructions from an Authorized Officer, to the District for deposit in the Administrative Expense Fund the amount specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or the establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund and not included in any prior transfer made pursuant to paragraph 1 and 4 above; and 6. after September 2 of each year, after making the deposits and transfers made pursuant to paragraphs 1 through 5 above, monies then on deposit in the Special Tax Fund will remain there and will be subsequently deposited or transferred pursuant to the provisions of paragraphs 1 through 5 above. Transfer of Prepayments. Amounts constituting Prepayments will be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Bond Fund designated as "Prepayment Account" and used to redeem Bonds as described above under the heading entitled "- Mandatory Redemption from Special Tax Prepayments." Any such transfer of Prepayments will be accompanied by written instructions executed by the Treasurer or an Authorized Officer directing the Fiscal Agent to place such Prepayments in the Prepayment Account. Penalties and Interest. Amounts constituting Penalties and Interest will be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Special Tax Fund designated as "Penalties and Interest Account." The moneys on deposit in the Penalties and Interest Account will be held and subsequently transferred, upon receipt of written instructions contained in an Officer's Certificate, to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 15 P632 1. to the Administrative Expense Fund that amount as specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund not included in any prior transfer made pursuant to paragraphs 3 or 6 under the heading entitled "- Deposit of Special Tax Revenues"; 2. to the Bond Fund that amount as specified in such Officer's Certificate for the payment of debt service on the 2013 Bonds; 3. to the Reserve Fund that amount as specified in such Officer's Certificate as necessary to increase its balance up to the Reserve Requirement; or 4. to such other fund or account as specified in such Officer's Certificate for any authorized purpose of the District. Summary of Rate and Method The District is legally authorized, and the District has covenanted in the Fiscal Agent Agreement, to cause the levy of the Special Taxes within Improvement Area No. 1, and each of its Zones, in accordance with the Rate and Method. The Rate and Method apportions the total amount of Special Taxes to be collected among the Taxable Property within Improvement Area No. 1, including each of its Zones. The full text of the Rate and Method is set forth in Appendix B. Determination of Zone Tax Requirement. Pursuant to the Rate and Method, the amount of the Special Tax to be levied in each Fiscal Year is determined separately for each Zone within Improvement Area No. 1. In accordance with the Rate and Method, the City Council, acting as the legislative body of the District, will levy the Special Tax each Fiscal Year on the Taxable Property in each Zone until the amount of the Special Tax levied on such property is equal to the Special Tax Requirement for each Zone (the "Zone Special Tax Requirement"). The Zone Special Tax Requirement for a Zone, for each Fiscal Year, is equal to the sum of (a) the Zone Allocation for such Zone times the applicable Administrative Special Tax Requirement, (b) the amount required to (i) pay regularly scheduled debt service on all such Outstanding Zone Bonds for such Zone due in the calendar year beginning in such Fiscal Year, (ii) accumulate funds to pay directly for the construction of Authorized Facilities, and (iii) pay the Zone Delinquency Amount, if any, (c) less a credit for funds available to reduce the Special Tax levy within such Zone, as determined by the CFD Administrator pursuant to the applicable Fiscal Agent Agreement. The capitalized terms used in the previous paragraph are defined as follows, in accordance with the Rate and Method: "Zone Allocation" means, with respect to a Zone, the percentage of Bonds of the applicable Improvement Area allocated to such Zone based upon such Zone's share of the cost of the Authorized Facilities to be financed from the proceeds of such Bonds. Within Improvement Area No. 1, the Zone Allocations are as follows: the Zone 1 16 P633 Allocation is 6.72%, the Zone 2 Allocation is 81.74% and the Zone 3 Allocation is 11.54%. "Administrative Special Tax Requirement" means, for any Fiscal Year, the amount estimated to be required to: (i) pay periodic costs on the bonds issued by the District with respect to Improvement Area No. 1 ("IA1 Bonds") other than regularly scheduled debt service, including but not limited to, credit enhancement and rebate payments on such Bonds as described in the applicable Fiscal Agent Agreement due in the calendar year beginning in such Fiscal Year, and (ii) pay Administrative Expenses. "Outstanding Zone Bonds" means, with respect to a Zone, (a) the product of(i) the original principal amount of the IA1 Bonds minus the principal amount of such Series of the Bonds that have been paid at maturity, or have been redeemed or defeased other than from the prepayments of Special Taxes for properties within such Zone and (ii) the Zone Allocation, minus (b) the principal amount of the IA1 Bonds that have been redeemed or defeased as a result of the prepayment of Special Taxes by the owners of Taxable Property within such Zone. "Zone Delinquency Amount" means, with respect to a Zone, for any Fiscal Year, the amount required to (a) replenish the Reserve Fund for the IA1 Bonds in an amount equal to the amount withdrawn therefrom as a result of the delinquency in the payment of Special Taxes levied in such Zone, as reasonably determined by the CFD Administrator, and (b) pay for reasonably anticipated delinquent Special Taxes in such Zone based on the delinquency rate for the Special Taxes levied in such Zone in the previous Fiscal Year. Effect of Zone Allocation. The effect of the provisions of the Rate and Method described above is that each Zone is responsible only for debt service on the Bonds allocable to such Zone. Thus, Special Taxes may not be levied in one Zone in order to provide amounts to pay debt service on Bonds allocable to another Zone or to replenish the Reserve Fund following the use of moneys in the Reserve Fund to pay debt service on the 2013 Bonds as a result of Special Tax delinquencies by property owners in a different Zone. No assurance can be given that the amounts collected in a Zone in any given year will, in fact, equal the applicable Zone Special Tax Requirement, due to a variety of factors, including the unwillingness or inability of property owners in such Zone to pay the Special Taxes, the maximum Special rates, or the maximum term of the levy of the Special Taxes. For a discussion of the impact of the zone allocation methodology pursuant to the Rate and Method, see "SPECIAL RISK FACTORS - Impact of Zone Allocation." 17 P634 The Maximum Special Tax rates per unit for each class of Taxable Property in Improvement Area No. 1 for fiscal year 2013-14 are shown in the table below. Table 1 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Maximum Special Tax Rates (per Acre) Fiscal Year 2013-14 Zone 1 Zone 2 Zone 3 Developed Property: Developed Property: Developed Property: Assigned Special Tax: $5,264 Assigned Special Tax: $44,242 Assigned Special Tax: $12,522 Backup up Special Tax:$5,849 Backup up Special Tax: $49,158 Backup up Special Tax: $13,912 Undeveloped Property: $5,849 Undeveloped Property: $15,624 Undeveloped Property: $13,912 See Appendix B-"Rate and Method.- See also "SPECIAL RISK FACTORS - Maximum Rates." Prepayment of the Special Tax Obligation. The Special Tax is subject to prepayment. The prepayment amount will be established by the procedures that are described in Section H of the Rate and Method. As of the date of this Official Statement, there have been no Special Tax prepayments in Improvement Area No. 1. Duration of Levy. The Special Tax is authorized to be levied for as long as needed to pay debt service on bonds issued for the District, but not later than 50 years beginning in fiscal year 2003-04. Exemptions. Pursuant to Section 53340 of the Act, the Rate and Method exempts properties that are or are intended to be publicly owned; except that the Special Tax on property not otherwise exempt that is acquired by a public entity will be subject to the Special Tax pursuant to Sections 53317.3 and 53317.5 of the Act. Parcels for which the owner has prepaid and satisfied the Special Tax are also exempt from further Special Taxes. See "SPECIAL RISK Section 53317.3 and 53317.5 of the Act read as follows: 53317.3. If property not otherwise exempt from a special tax levied pursuant to[the Act]is acquired by a public entity through a negotiated transaction, or by gift or devise, the special tax shall ... continue to be levied on the property acquired and shall be enforceable against the public entity that acquired the property. However,even if the resolution of formation that authorized creation of the district did not specify conditions under which the obligation to pay a special tax may be prepaid and permanently satisfied, the legislative body of the local agency that created the district may specify conditions under which the public agency that acquires the property may prepay and satisfy the obligation to pay the tax. The conditions may be specified only if the local agency that created the district finds and determines that the prepayment arrangement will fully protect the interests of the owners of the district's bonds. 53317.5. If property subject to a special tax levied pursuant to this chapter is acquired by a public entity through eminent domain proceedings, the obligation to pay the special tax shall be treated, pursuant to Section 1265.250 of the Code of Civil Procedure, as if it were a special annual assessment. For this purpose, the present value of the obligation to pay a special tax to pay the principal and interest on any indebtedness incurred by the district prior to the date of apportionment determined pursuant to Section 5082 of the Revenue and Taxation Code shall be treated the same as a fixed lien special assessment. 18 P635 FACTORS - Exempt Properties." Since formation of Improvement Area No. 1, there have been no prepayments of Special Taxes. Reserve Fund The Fiscal Agent Agreement establishes a debt service reserve fund (the "Reserve Fund") as a separate fund to be held by the Fiscal Agent. Moneys on deposit in the Reserve Fund will be used solely for the purpose of paying the principal of and interest on the 2013 Bonds, as such amounts will become due and payable, in the event that the moneys in the Special Tax Fund and the Bond Fund are insufficient for that purpose or for redeeming 2013 Bonds as described below. The Fiscal Agent will, when and to the extent necessary, withdraw money from the Reserve Fund and transfer such money to the Bond Fund or the Redemption Fund for such purpose. On any date after either the transfers, if any, required by the preceding paragraph have been made for any Bond Year or the valuation of the Permitted Investments in the Reserve Fund (in accordance with the Fiscal Agent Agreement), if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, the Fiscal Agent will transfer to the Reserve Fund from the first available monies in the Special Tax Fund an amount necessary to increase the balance in the Reserve Fund to the Reserve Requirement. If at least 10 Business Days prior to each Interest Payment Date of each year, the amount on deposit in the Reserve Fund, less Investment Earnings resulting from the investment of the funds it contains that, under the Fiscal Agent Agreement, must be rebated to the United States, is in excess of the Reserve Requirement, the Fiscal Agent will transfer such excess to the Bond Fund. In connection with any redemption of 2013 Bonds as described under the heading entitled "- Optional Redemption" above, amounts on deposit in the Reserve Fund which would be in excess of the Reserve Requirement following such redemption will be transferred to the Redemption Fund or the Bond Fund, as applicable, prior to such redemption and applied to such redemption of 2013 Bonds pursuant to written instructions of the District contained in an Officer's Correspondence. Whenever the balance in the Reserve Fund and the Bond Fund exceeds the amount required to redeem or pay the Outstanding 2013 Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent will transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding Interest Payment Date, to the payment and redemption (as described under the heading entitled "- Optional Redemption" above) of all the Outstanding 2013 Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding 2013 Bonds, the balance in the Reserve Fund will be transferred to the District to be used for any lawful purpose of the District as set forth in the Act. Covenant for Superior Court Foreclosure Foreclosure Under the Act. Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of the Special Tax on the taxed parcel, the City may order the institution of a superior court action to foreclose the lien on the taxed parcel within specified time limits. In such an action, the real property subject to the unpaid amount of the Special Tax lien may be sold at judicial foreclosure sale. District Foreclosure Covenant. On or before March 1 and June 1 of each Fiscal year, 19 P636 the District will review the public records of the County to determine the amount of Special Taxes actually collected in such Fiscal Year. If the District determines that any parcel subject to the Special Taxes is delinquent in the payment of two or more installments of Special Taxes, the City will, not later than 45 days of such determination, send or cause to be sent a notice of delinquency (and a demand for their immediate payment) to the property owner. The City will cause judicial foreclosure proceedings to be commenced and filed in the Superior Court not later than 90 days of such determination against any parcel for which a notice of delinquency was given pursuant to this section and for which the Special Taxes remain delinquent. No assurance can be given as to the time necessary to complete any foreclosure sale or that any foreclosure sale will be successful. Neither the City nor the District is required to be a bidder at any foreclosure sale. Sufficiency of Foreclosure Sale Proceeds; Foreclosure Limitations and Delays. No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Special Tax installment. Subject to the maximum rates, the Rate and Method is designed to generate from all Taxable Property within the District the current year's debt service, administrative expenses, and replenishment of the Reserve Fund to the Reserve Requirement, including an amount reflecting the prior year's delinquencies. However, if foreclosure proceedings are necessary, and the Reserve Fund has been depleted, there could be a delay in payments to owners of the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the City of the proceeds of the foreclosure sale. Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post- judgment interest and authorized costs, unless the consent of the owners of 75% of the outstanding 2013 Bonds is obtained. However, under Section 53356.6 of the Act, the City, as judgment creditor, is entitled to purchase any property sold at foreclosure using a "credit bid," where the City could submit a bid crediting all or part of the amount required to satisfy the judgment for the delinquent amount of the Special Tax. If the City becomes the purchaser under a credit bid, the City must pay the amount of its credit bid into the redemption fund established for the 2013 Bonds, but this payment may be made up to 24 months after the date of the foreclosure sale. Neither the Act nor the Fiscal Agent Agreement requires the City to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale, and the City has no intent to be such a purchaser. The City will levy the Special Tax to pay the current year's debt service and related administrative expenses and to replenish the Reserve Fund to the Reserve Requirement, subject to Maximum Special Tax rates. However, in the event such superior court foreclosure proceedings are necessary, and if the Reserve Fund is depleted, there could be a delay in payments of principal of and interest on the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the City of the proceeds of the foreclosure sale. See "SPECIAL RISK FACTORS—Bankruptcy Delays" and "—Proceeds of Foreclosure Sales." No Teeter Plan Collection of the Special Taxes is not subject to the "Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds," as provided for in Section 4701 et seq. of the California Revenue and Taxation Code (known as the "Teeter Plan"). Accordingly, collections of Special Taxes will reflect actual delinquencies, if any. 20 P637 Investment of Moneys Except as otherwise provided in the Fiscal Agent Agreement, all moneys in any of the funds or accounts established pursuant to the Fiscal Agent Agreement will be invested by the Fiscal Agent solely in Permitted Investments, as directed by the District or City. See Appendix C — "Summary of the Fiscal Agent Agreement' for a definition of"Permitted Investments" and for additional provisions regarding the investment of funds held under the Fiscal Agent Agreement. No Additional Bonds Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax Revenues may be issued under the Fiscal Agent Agreement. 21 P638 IMPROVEMENT AREA NO. 1 Location and Description of Improvement Area No. 1 General. Improvement Area No. 1 consists of approximately 147 gross acres that are primarily built-out. As explained in "SECURITY FOR THE 2013 BONDS — Summary of the Rate and Method" above, the Rate and Method divides the taxable property within Improvement Area No. 1 into three zones: Zone 1, Zone 2 and Zone 3. For purposes of determining the amount of the Special Taxes to be levied in each Zone in Improvement Area No. 1, the Rate and Method allocates a portion of the outstanding 2013 Bonds to each Zone in Improvement Area No. 1. Each Zone in Improvement Area No. 1 is responsible only for debt service on the outstanding 2013 Bonds allocated to such Zone, and Special Taxes may not be levied in one Zone of Improvement Area No. 1 in order to provide for amounts to pay debt service on outstanding 2013 Bonds allocated to another Zone in Improvement Area No. 1. Zone 1 Allocation. The Zone Allocation for Zone 1 is 6.72% of the initial principal amount of the 2013 Bonds (or $964,656). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 1 at$69,180,921. The table below provides certain information about the parcels contained in Zone 1 as of January 1, 2013. % Responsibility for Fiscal Year Number of Classification under 2013-14 Special Parcels Use Rate and Method Tax within Zone 215 Residential . Developed 100% 1 N/A Undeveloped 0 216 The Developed Property in Zone 1 consists of 215 single-family attached condominium units with two product lines: "24-Seven at Victoria Gardens" and 'Three-65 at Victoria Gardens." The 24-Seven at Victoria Gardens development contains 99 completed attached homes ranging in size from approximately 1,460 square feet to approximately 1,560 square feet. The Three-65 at Victoria Gardens development contains 116 attached homes ranging in size from approximately 1,493 square feet to approximately 1,932 square feet. The property was developed by Shea Homes Limited Partnership. The first homes closed to individual homebuyers in March 2007, and all the homes were completed and conveyed to individual homeowners in the first quarter of 2010. All the 215 completed single-family attached condominium units are within Final Tract Map No. 17487 recorded on November 29, 2006. An additional 95 single-family attached condominium units were originally planned within Zone 1 within Final Tract Map No. 17840, consisting of 5.33 acres, which was recorded on November 29, 2006; however, in 2009, Shea Homes Limited Partnership conveyed the undeveloped parcel to the Rancho Cucamonga Redevelopment Agency. The parcel is currently owned by the City as Successor Agency of the Former Rancho Cucamonga Redevelopment Agency (the "Successor Agency'), although it is expected to be sold to a private entity in the future. The parcel currently constitutes Undeveloped Property and is being used as a parking Preliminary; subject to change. 22 P639 lot. The parcel's fiscal year 2012-13 assessed value was $0, and it is anticipated that there will be no Special Tax levied on it prior to any transfer. See "— Land Owners' below for more information about property ownership and land use in this Zone. Zone 2 Allocation. The Zone Allocation for Zone 2 is 81.74% of the initial principal amount of the 2013 Bonds (or $11,733,777). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 2 at $230,387,001. The table below provides certain information about the taxable parcels contained in Zone 2 as of January 1, 2013. % Responsibility for Fiscal Year Number of Classification under 2013-14 Special Parcels Use Rate and Method Tax within Zone 4 Commercial Developed 100% 1 Commercial Undeveloped 0 5 Zone 2 also includes the Victoria Gardens Cultural Center and two parking structures constructed and owned by the City to serve the regional mall and cultural center. These parcels are exempt from Special Taxes under the Rate and Method. See "— Land Owners" below for more information about property ownership and land use in this Zone. Zone 3 Allocation. The Zone Allocation for Zone 3 is 11.54% of the initial principal amount of the 2013 Bonds (or $1,656,567'). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 3 at $48,886,211. As of January 1, 2013, Zone 3 contained 14 commercial parcels, all of which are classified as Developed Property under the Rate and Method. For fiscal year 2013-14, the parcels are projected to be responsible for 100% of the Special Taxes within the Zone. See "— Land Owners' below for more information about property ownership and land use in this Zone. Preliminary; subject to change. 23 P640 0 V � Q � oQm NQ Nr C 7 � � i=1 � Z mZ m NZ N o E > m � Z a N O N cc; E m m m o v m M NN U Q , N m N m M V X y (A N N fp O 6 Em umi ° um N N d :o co m r r m m ui o 'C O N N r r N QL, ~ O v_o N N c m d � o 0 > -O cF o0 0 00 0 00 0o a0 a Oo, d v °o °o °o of m CD Z•C� q d Cl N N N E X O m C i w U) tip 'o M O Q an o U' O °7 N w.a NC O ` d q 9 m 0 m r 0 n n 0 r 0 an d � 3 O Z O y 0 o m C N 0 O Vc t>O �p 0 .0 V C to C m � rn y r r m m M c m N 7 N d R C. K N o o ° pM 'O N U � Q J Q C � O N O .. y. � a d O d M 0 O N N N N O N N Z5 �l D -C cu m 0) N u to m W O F d N V O LL m O m O O N O a a _aoN j 0) z.: E N d c�C- O c — � v a2i �L'O 2` C� d co v o rno mN cc 0 mm 30 @ N E U () dN m m W W N N O y w XEam L N -0 E oo am Lmo cmo 0 0 Sao '°dME o� .U- N U a C a d c y o may da rn— O- j vo co wm ° moo CI N (a C } N (m�J 0 V° N N O c m 6 0 " � °_'A u x w ro N cmo m rn O .0 "O q Oo o. A m m r' o awN'S `d udi u N N F w pY N QIL M M >wo aQ N N x ° c c -� d d R C L m O N U ~ x as m 1OEomco @M E X m aM a� � `yM C G) O f. d N N N y C Ol 0 (0 O Q�— � Z N� dCm ` L 3 `O T O a E a c m .0 4 O_N J. m Q d a M (n M > T T T y y W y N O r C C C Y c m u t a p N c C T�x m rdo n do a dCo n ococ c0;0= 0 d ow c r°n od oa vvu � mu°� j ~ Ow CL 'O a "o as co V mU �d m ow n d —d mmamOm E L N ui U v 0 do n— O o vJ a N > c a a . w > > a > v 0 0 7 y 0 7 y N 0 D w o N d ���� P641 a d �a c� o oa N d � U T O � 6 U d N � y. N a � K U @ O~ d R u d d L_ p am cc m�- .o C N d�'1 d N O @ O'd � qT N u (p O nv y `o `d d N cL N~ c d w E d d aN _ N '- E q d Kp j � gTNm � N 3m @ c o N N Y d 0.2 a o n a d of o �°w5 m NOOdNN 4 � w d 7 c @ d p w N ~ c d > O E N ON 0 d T C O o d m c N a c — �omTt a 1O C v 3 E O N nlh y @ d O d> o E 0 y TD > U E E c � n� a do ?�:st d d x U U v x c c O d @ N @ .- UmFmdU �v� o P642 Assessed Property Values No Appraisal of Property in Improvement Area No. 1. The District has not commissioned an appraisal of the taxable property in Improvement Area No. 1 in connection with the issuance of the 2013 Bonds. Therefore, the valuation of the taxable property in Improvement Area No. 1 will be estimated, for the purposes of the Act, and set forth in this Official Statement based on the County Assessor's values for fiscal year 2012-13. Assessed Valuation. The valuation of real property in the City is established by the County Assessor. Assessed valuations are reported at 100% of the "full cash value' of the property as defined in Article XIIIA of the California Constitution. Article XIIIA of the California Constitution defines "full cash value" as the appraised value as of March 1, 1975, plus adjustments not to exceed 2% per year to reflect inflation, and requires assessment of"full cash value" upon change of ownership or new construction. Accordingly, the gross assessed valuation presented in this Official Statement may not necessarily be representative of the actual market value of certain property in Improvement Area No. 1. The fiscal year 2012-13 total assessed value of the 235 parcels of Taxable Property in Improvement Area No. 1 is $348,454,133. Table 3 below shows a history of assessed value in Improvement Area No. 1, as allocated among the Zones. 26 P643 d e C D>O r r NO 4) N (p Q4JMM4) OOON t ZOO)NONNOO N U N N N O o V O O W 4)� N V MWM 0 OmON �- M — OM N N - ` q V W N N r 4) O)N V .d. N d 0) O r 4) q M ( M 4) @ O d � O� (O ra00 a0 4) N < T ~ m R V (� r MM m V m _ Q � M M M M o M M U y d C c ( A pD p0m � t QotOMN0 (O UOor L2 U Z "NM O (V N•NO 4) a v C M O O N N —w a — O_ � r v m rn M 10"1 V N d N V OOrrN V 014) @ c y d 0 (O N N N O r M 0 0 7 N y 41 e07OC t 0( a0 . N 4) r0 V V 41� aD 00 Q1 � N4) 4)u7O V t0 (j O d @ } C M vyi � •O w � mw N C@ � i .CJ N4J 4) R V V V 00 L O @ ON C C%l C cc 04 Op dQ cc R_ m .y C C �+ N M-6 @ O ? C ' 1 l0 O C Q (WO M O O O M r N N @ O _ L Z N N N O N 0 0 0 d l0 U N 7 N N L d v C M V 0 rMOmaornvm� DN N O � 0 IL y (OrrMrorno � o y O 4) N d � 4J 4) MNL C'! RCt �❑ C 4) N V d Z y ,a d y N NraDO00 � rr j T N @ `7 L _ y O L c (n d v (nornmo � Mm ca {4 O d rnrQ4)4JNMOM (pD y @ O Q a m N N jO N 01 N u) O 0 O N U L N K (� MMNNNMNMM 4) F Q 47 y 41 Q � NNNNNN ° L w 0 V M ~ O 0 U 3 4) y 2 HZ N V M 4) 4) 4)4) N 4 J O @ O O Eo h ay « mE d o p CL lL N E Z > V E d e a m a C Q (OOMON �( tO+I � D U H a O L ZONO V NO) RO �` U e U c a d o 0 o r N v o c (D d C13 0_7L ° � (OnrnNV4rinmrnrn ao 41 X C N d cO 04J04) NM V O cr Q 0 � 41r N4) 4) OD @ N y N m N M 4)M N d U 0 Q j 4) r O M(O ([1 4) (00 4J m C U) r 9 N N U) y m v c yN Y ^� NNNN004) 4) 4) (gyp d D J NNN U m `) dtlJ L 3 d U O ° O co d d H EEO N 4)N N 4) 4)M M M N 7 = N 1fn « - -" NN fnU r O N r N_ M d "O 'E - 999997 � C d R O (n4)rW mo � N @ 0 d 0 0 0 0 0 O � � — �O E >- 000000000 =() N N N N N N N N N P644 Value-to-Debt Burden Ratio General Information Regarding Value-to-Debt Burden Ratios. The value-to-debt burden ratio on bonds secured by special taxes will generally vary over the life of those bonds as a result of changes in the value of the property that is security for the special taxes and principal amount of the bonds. In comparing the aggregate assessed value of the real property within Improvement Area No. 1 and the principal amount of the 2013 Bonds, it should be noted that an individual parcel may only be foreclosed upon to pay delinquent installments of the Special Taxes attributable to that parcel. The principal amount of the 2013 Bonds is not allocated pro-rata among the parcels within Improvement Area No. 1; rather, the total Special Taxes have been allocated among the parcels within each Zone according to the Rate and Method. Economic and other factors beyond the property owners' control, such as economic recession, deflation of land values, financial difficulty or bankruptcy by one or more property owners, or the complete or partial destruction of Taxable Property caused by, among other possibilities, earthquake, flood, fire or other natural disaster, could cause a reduction in the assessed value within Improvement Area No. 1. See "SPECIAL RISK FACTORS - Property Value" and "Bankruptcy Delays." Aggregate Value-to-Debt Burden Ratio. The aggregate value-to-debt burden ratio of Taxable Property in Improvement Area No. 1, based on fiscal year 2012-13 assessed values, the initial principal amount of the 2013 Bonds, the burden of overlapping special tax bonds and overlapping special assessment liens is shown in Table 2 under the heading entitled "- Land Use Distribution" above. David Taussig & Associates, Inc., reports that there is also overlapping general obligation debt, and the properties in Improvement Area No. 1 are subject to a number of taxes, direct charges and assessments. See "—Direct and Overlapping Governmental Obligations" below. 28 P645 d � � d W D • C Q Q N O Q - c d Z Z .- mZ .-- @ Co @ m d m @ U LL o > N m p @ C c '0 -0 a 0 U N O .R. 'O Q Q m 0< 0 n . N ° H O Z O cc;z p N J 'Q > m o o N > a N V @ C OO (0O O>O N �` (D L@ C N N O y C N y N c O y ? O F O w N w > X O ^ c O O @ o a O N �p �"� X o o M r o o z N U C C N ua y y .amF V t w O °-m w CL N@ m N A y VO Z 'o M m O > m a0 � ° w 7 a @ N d M @ OQ N Nci Y a O Q o Co 0 m c a d L N N N C N > - f N O C Z N Cl) 000 o m CL) >'O E V � mN rc o cio v o vo @ N O N c amp M .n W V U Z aLm � n d� cc N O C D w = a c -0 d O y a 0 m 0 t d U y v m N 'C N («XO y @ LL N -0 o o m co o E O c v o o N LL y O V~ ~ � o m o N O HN@ (j CO` MO coodv12 L L 7 a.7 d NN m•• o O N v v D o " E Ea dN r m 2 �2 =° tea co E @ U O " M w ar (o ao w «o V H d 7 01 N n C o E- O p y m of ui m a-i0i E p m o ++ Tm E~ . H L CO O O 00 m C'j R' ; y00oc �+ d@ C u w a E w-6 U G K d o Uyv x vin rn d X 0 O U A O �O w O y LL N M p N N N co CL CA 0 > N c U o E d "" yL Eocyy� X p ` N C C O N Q N Cl U @ �' .O ` OO rofON �v muw� � d u m C E maw N o� E ° C Olp Z� � J N > A U O. c Of0 �dMNN M y (D 4a H N N N o y'w cc w O � •- c 000@ F y M O O mo �O 66 Ev°a (p O 0 r D N M i0 d N N m N m A N @ Q U c of dm mm�UO o m A : 000� > > oo oowo �vvvvo m M — — N m th .- H P646 m c A d . d Em O N (ON oZ O d y 6 � N V N o Q � N � 0 r C J C LL d o o y p � M O I N O M ¢ O m (OM W OZ O x �- O u F n a M O N N O O rNM W W MIS r N N O 00N rOO r O L m N C6(6 r,:C M r >m O N q N M O a M O a fD co 0 N to N LL M W o °v O N N o m N N c Z C Id CO (D V >0N co) A � eo vi o oO o O Q d N O �I m o E E N r L a you O r p A N NnO NNON 0 ° Ey O N a ' O1� 100> o o Z O M N V (O (Q � u N ya m M° O O to N a m N y t 4) y 7 O a N a.10 M F- C Q N � f/l � N � N t vyN LL M U O l0 � X Q7M � to O- om �' L Np o_._ y -L C LL d O V F 2N-m� T� > C N a v Z a V_ y N Y Y N C L O D 'O t0 .V a c n 2 CL CL £ .9 r O +' O c10.fl !xa Oa0 a`m C 0t.. U w OI d N M F V co °_N t a D LL o dofg` O E y O N Ooyo� N y a y O O y U lC N 0 N N ° d G1 N en j Q fn p N V N d L Yl J N O C O y O- E N M� Z 0U) vE 0 ,a -'— ° — y y C V y Q V @ y Q C U a c -ts ° y Q.-4 01 U d U O tll N 6'aC- N r J ,N °o6 m 17 0 N0 V> N CA E _°O. a CD l7 Q 2 MO) OO c lO � 0) O O O T N y N i- y 0 O dUN ON ammm �',Um 4) 0 0 0 0 N A O) O O O O y r u _ Q C) M � � NJI- P647 d 0 ° � z zz "' 0 V N N 0 � E v t C iy d '� o o r O m "� Z Z Z x _ to of o m w M O O H O m H m 0 U) M '+ H `O `1 C M O to d O > to n m c y = O m LL m M c m O M Q o o v O C 7 C a ' j p d N N 0 0 0 0 0 m o d (pN C r O ., � N V 0000 2d c ON Dm ° ~ > (N V OOO OO m oN O Z = P 0 C w I O 3 d c E U � m cm >, V « m N D U � Z � > 10 a00 m dd0 d O o! 0 r (p 0• N c0 o m«m M L y U 4) cv n u y _ N N M 0 p R w > X a o omL d C � N=LL d O U V �y > Cd L N _ O 0 C 0 N0000) U = Q d u } N D' E a EE � d my x m sdd p n 'o CD U N d TMFfA cD oya. C N LL w o�tac o dcooE N H d w D y o ji x N C U l0 W O x d O.2 d Ix y N d Q L ` y d V' O O O O R `m C O c D E0. � J c °`o E y = Z fn aiEocmwu m mD C O d fn c a+ m10o mmQ a N ° zc3 w5 a C C ooyQ.a°c'u (D V«m d d— ° O d C =.T:2 m QI m N d y d O T� = (I `- •-- L L« O a OI V > �. (C .0 0 0 0) 0) N C C C d N c 00 O rm m � 6O EDDD c jr m 6 N U C N of E m m m j 16 j m m m O m o I O O O O A > ONO O y o QM a- .- NJ f • N P648 Land Owners The following table lists the payers of Special Taxes in Improvement Area No. 1 with respect to Taxable Property for fiscal year 2013-14, based on the projected fiscal year 2013-14 Special Tax levy and fiscal year 2013-14 assessed values. The table does not identify the names of individual homeowners. Rancho Mall, LLC and Tenants-in-Common provided the information in this section about the property in Zone 2 and the property in Zone 3 owned by Tenants-in- Common and about the owners of such property. The City can provide no assurances about the accuracy or completeness of such information. 32 P649 0Q y — M- N m0 04 W 0 0 y d O ON 0 I�l- rO1mNm p emN�N IAD mN O�M O O`m a p fMOO lN�O O 1MaNN 0 o rLMM m c4 O NONOMmmM Nm a(4 o 6 M tO O O 0 m d O D m MND A M 1 m m N o � N M N C N N M N p N N r N 0 m M M E O O d F o 0 NO N 000 ip Nlp 1pOr f� nO m 0 O d dM A !�O I� rO r MMmmOD 1� NmmN 1p O � '^�' d lD0 t0 O r c'M N 00000000 � O a � H d op O O a y m � yvd vov o mmmmut — Om ut � a N N n) O ON0 � 0000t000 dMH d m m W W a0C' MCOm t0 f0N N O _ J 16 1p N m NI, (O m m 0 tn M M O O A y m m O O M N m a N 7 d fA m N mm U X Qf U O M y ' X LL ^j A 00 O mom M a0 a0 M M i0m00m0 000 m m O Dpi M M 0 0 mC6m CM6 (Om � M N C- C CN Cp Cp N N ISM M N — OmmmaD 16 m m (O w w 0 04 .- .- {`7 C1 q t9 O O N ri C0 ci e � C O � m pZ p 0.22 O. a _ om0 — — — — — — — — — e ut E z x N O x N N N m A A 0 y d ~ an d Z ~ a te) c ;y 4) a . 0 y 'mm' m' 'm'mm' mmmm L d V M d ` ` ` ` ` ` o v" y M M Ey 'A o d -vo vE vvvvvvvvvv o w LL a"h E E E E E E E E E E E E d m - N O A yv E E E E E E E E E E E _r m v > o aX v� oU 0000000000 0 O O T N W � a Q U Q UUUUUUUUUU Q Q p u' 0. 10 V d D d Z D d Z DDDDDDDDDD Z Z c N X d d d d d d d d d d d d d A E 41 E a0 a nnaaaaaaa 3 5� C(� 3 E O O d O 0 v 0 v 0 v 0 v 0 v 0 v 0 v 0 v 0 v 0 > v o d v v 0 0 0 v v o > > > > > > > > > > > E d c E o o000000000 p C v d N u d a A Aa V1S U v�v v � NAyN C C C d 0 A C t m m m d d d md/1 N EE E O O C O 0 0 o auit � xE 00 U m O O O p i A•- c N O Q E E E ai 3 > > c a t E d O J J J C U c D u c y D c d \ \ d J O c O d y d 0 0 O �a cc co. w.� E 5m nN'Jd ` v so °-' o v H. out �'o UU U d 01� J 0 .0 dQ mo c A 3 Jm c N A LL C N m h N M LL cy Od JJ J U w Oa Q y O o C O JJ Y o n 0 o 0 d m � v 0 0 E m N d A ~C �a N�L.am0 d.. 'om0d 0 d L D.0d.L D.0d_.9 E 0 Tc w o� " v 00 C70 U c Mt amm'a z°M m z O .0 C o O O 0 C V J f- c0 21 K d U O y A Q c ca A T C d C d C O D d d O O D U 0 0 c « d N A A 0 o O 0 -6 O a O > A p c m S C9 v vv V v P650 O C C Z O o a U U v U U E J J d T T o n n p N N E d d `w `m o c_ c_ o - L L p N N d ; 3 0 O O D o e C o a a - C C j0 N N (OJ U U J C C y U U (n C C d d y a D CD CD j N N j N_ N_ d L O O U_ T U U c LL LL d T T d n n j N N C N d d d d d C C O "n "n a L L O N N N y d d C C a ; ; p o 0 D o e d o 0 m m x a D d d d c w `c c N d d V N N C O O � N N Q r r r N � � J J J6 C 7 7 C 7 � D D d d d L ry A T a D n - - D o 0 d K K c O N N O N N C T d d N N y d Q Q d jT T V U C C O o J N m'o U U Q 4' pop 00 c a c u c 2 N d d d d d F d c E m E . D o.O CE cE"> W N p O m O N it I NUtgUO 2 U 7 lD � 0 P651 Zone 1 Land Ownership. For fiscal year 2013-14, 215 developed residential parcels in Zone 1 are projected to be responsible for 6.72% of the Special Tax levy in Improvement Area No. 1 and the entire Special Tax levy in Zone 1. See "- Location and Description of Improvement Area No. 1 — Zone 1 Allocation" for information about certain additional parcels that are currently owned by the Successor Agency, but expected to be sold to a private entity in the future. No single property in Zone 1 is projected be responsible for more than 0.02% of the projected fiscal year 2013-14 Special Tax Levy in Improvement Area No. 1. Zone 2 Land Ownership. The four commercial parcels that are developed as Victoria Gardens Mall are projected to be responsible for all the Special Taxes levied in Zone 2 for fiscal year 2013-14. There are five parcels in the Victoria Gardens Mall that are not Taxable Property: APN Owner Land Use 0227-452-34 LC Cucamonga Commercial Inc. Regional Mall 0227-452-43 Victoria Gardens Mall LLC (1) Regional Mall 0227-452-44 Victoria Gardens Mall LLC (1) Parking Lot 0227-452-45 Victoria Gardens Mall LLC (1) Theatre 0227-464-56 Victoria Gardens Mall LLC (1) Regional Mall (1) Merged into Rancho Mall, LLC, in 2010. Set forth in the following paragraphs is a summary of Victoria Gardens Mall and its property owner. Property Owner Lessee. The real property in Zone 2 is owned by the Tenants- in-Common (however, see "- Announced Recapitalization Transaction with QIC" below). FC-C, one of the Tenants-in-Common, is wholly owned by Forest City Enterprises, Inc., an Ohio corporation ("Forest City"). LC, the other Tenant-in-Common, is wholly owned by the following entities (collectively, the "Lewis Entities"): Richard A Lewis, as trustee of the Richard A Lewis Revocable Trust U/D/T August 16, 2004; Robert E. Lewis, as trustee of the Robert E. Lewis Revocable Trust U/D/T August 17, 2004; Roger G. Lewis, as trustee of the Roger G. Lewis Revocable Trust U/D/T August 20, 2004; Randall W. Lewis, as trustee of the Randall W. Lewis Revocable Trust U/D/T September 1, 2006; and John M. Goodman each of whom is a member of the Executive Committee of the Lewis Operating Corp., a California corporation that serves as the manager of a majority of the members of the Lewis group of companies. The Tenants-in-Common currently ground lease the real property in Zone 2 to Rancho Mall, LLC, a Delaware limited liability company, for purposes of owning, leasing and operating the Victoria Gardens Mall. The ground lease obligates Rancho Mall, LLC to reimburse Tenants-In-Common for payment of Special Taxes levied pursuant to the Rate and Method. Rancho Mall, LLC's sole member is RM Member, LLC. RM Member, LLC is comprised of the following members: Forest City Rental Properties Corporation, an 80% member, and LC Cucamonga Mall, LLC, a 20% member. Forest City Rental Properties Corporation is a wholly owned subsidiary of Forest City Enterprises, Inc., a New York Stock Exchange-traded company (NYSE Symbol: FCE.A). LC Cucamonga Mall, LLC, is a Delaware limited liability company whose sole member is Lewis Investment Company, LLC, a California limited liability company. 35 P652 Announced Recapitalization Transaction with QIC. On June 3, 2013, Forest City and QIC Limited ("QIC"), an Australian investment management company, entered into an agreement whereby QIC will invest in a portfolio of eight of Forest City's regional retail malls, including the real property owned by the Tenants-in-Common in Improvement Area No. 1. The transaction is expected to close in the 3rd quarter of 2013. It is currently anticipated that there will be a restructuring of the ownership of the real property and membership interests of entities related to the Victoria Gardens Mall development such that the Zone 2 real property will be transferred to Rancho Mall, LLC (and the Tenants-in-Common will be dissolved) and the ownership interests of RM Member, LLC will directly or indirectly be held 51% by Forest City (or a Forest City related entity) and 49% will be owned directly or indirectly held by QIC. It is currently anticipated that the Lewis Entities will no longer hold any ownership interest in the currently taxable Zone 2 property or the Victoria Gardens Mall development. Forest City related entities will continue to manage the Victoria Gardens Mall development in Zone 2. There can be no assurances that the QIC transaction will close or that the restructuring described herein will take place exactly as described. Any material deviation from this disclosure and information on the actual closed transaction will be provided when applicable pursuant to the TIC Continuing Disclosure Certificate. Description of Victoria Gardens Mall. Victoria Gardens Mall in Zone 2 opened for operation in October 2004 and is operated as an approximately 1,201,000 square foot lifestyle center. As of May 1, 2013, approximately 90% of the usable square footage in Victoria Garden Malls was rented to 147 tenants. Lease terms generally range from 3 to 5 years. Rancho Mall, LLC is reimbursed by some tenants for certain common area costs incurred in connection with the operations of Victoria Gardens Mall, including the Special Taxes. Any reimbursements are made in accordance with the terms of a tenant's lease. Attached as Appendix H is a roster of tenants in Victoria Gardens Mall as of 2013 [To come two weeks prior to posting]. Statement of Operations for Rancho Mall, LLC. Set forth on the following page is the audited statement of operations for Rancho Mall, LLC for the fiscal years ending January 31, 2012 and January 31, 2013. 36 P653 Statement of Operations Rancho Mall, LLC Fiscal Years Ended January 31, 2012 and 2013 Year Ended Year Ended January 31,2012 January 31 2013 REVENUES Minimum Rents $20,144,889 $21,138,002 Overage Rents 745,419 853,085 Tenant Reimbursements 8,827,252 9,192,813 Parking Income 519,496 488,760 Other 589,648 743,489 TOTAL REVENUES $30,826,704 $32,416,149 EXPENSES Operating Expenses $5,936,068 $6,470,153 Real Estate Tax Expense 3,255,193 3,312,340 Management Fees 841,544 873,881 TOTAL EXPENSES $10,032,805 $10,656,374 NET OPERATING INCOME $20,793,899 $21,759,775 Interest $10,255,106 $9,989,415 Mortgage Procurement Amortization 152,654 152,653 Depreciation and amortization 5,574,157 5,939,774 NET INCOME $ 4811,982 $5 677 933 Existing Loan and Mortgage. Rancho Mall, LLC, has obtained two loans from Teachers Insurance and Annuity Association of America, a New York corporation. The loans are secured by a (i) leasehold deed of trust and an assignment of leases and rents from Rancho Mall, LLC, and (ii) deed of trust and an assignment of leases and rents from the Tenants-in-Common. As of April 30, 2013, the aggregate outstanding balance of the loans was $164,290,598.95. For the first loan, monthly installments of principal and interest in the amount of approximately $959,280 are due through December 1, 2014, and a balloon payment of approximately $134,185,800 is due January 1, 2015. For the second loan, monthly installments of principal and interest in the amount of $164,789 are due through December 1, 2014, and a balloon payment of approximately $24,019,200 is due January 1, 2015. Existing Debt to Former Redevelopment Agency. In 2003, the Tenants-in- Common executed a promissory note for up to $13,000,000 to the Rancho Cucamonga Redevelopment Agency (the 'Redevelopment Agency") in connection with their development of the Victoria Gardens Mall (the "Project'). In general, the promissory note obligates the Tenants-in-Common to pay (i) a specified portion of any excess return based on 2008 operating results ("Excess Return"), (ii) net sale proceeds, or (iii) net refinancing proceeds of the Project (as further detailed in the promissory note). As a result, in 2009, the parties determined that the Tenants-in-Common owed $2,475,000 to the Redevelopment Agency as a result of the Excess Return on the Project. The terms of the promissory note required the amount to be paid in 10 annual installments of $305,000 starting in 2009 at an interest rate of 5%; however, effective December 16, 2009, the parties modified the promissory note in order to delay payment of the first installment until May 1, 2012. 37 P654 In July 2010, with the Redevelopment Agency's consent, the Tenants-in- Common assigned the promissory note to RM Member, LLC, the sole member of Rancho Mall, LLC. All redevelopment agencies, including the Redevelopment Agency, were formally dissolved effective as of February 1, 2012, as a result of State legislation enacted as part of the 2011 Budget Act and upheld by the California Supreme Court (as amended, the "Dissolution Act'). In accordance with the Dissolution Act, the Redevelopment Agency's rights under the promissory note were transferred to the Successor Agency. In 2012, the Successor Agency and Tenants-in-Common agreed to further delay the first installment payment due under the promissory note. As of May 31, 2013, the first annual installment payment of $305,000 was paid, and the amount of the payment that was applied to the principal balance was $197,000. Therefore, the current balance, as it relates to the 2008 excess return, is approximately $2,278,000. The promissory note terminates on the earlier of: (i) the date the Tenants-in- Common have made payments to the Successor Agency totaling $13,000,000; (ii) the date that is 30 years following the date that a final Certificate of Completion for the Project is issued by the Successor Agency and recorded in the San Bernardino County Recorder's Officer (which occurred on January 3, 2005); or (iii) the date that the Tenants-in-Common sell the entirety of their interest in the Project and have fully paid the Successor Agency its share of resale proceeds and any other amounts outstanding under the promissory note; provided, however, that the Tenants-in-Common are permitted to assign the promissory note to certain affiliates under certain circumstances without triggering the repayment obligations under the promissory note. The Tenants-in- Common remain subject to up to an additional $10,525,000 in payments under the promissory note if certain thresholds are satisfied in the future. [discuss impact of proposed recapitalization] Representations by Tenants-In-Common. In connection with the issuance of the 2013 Bonds, each of the Tenants-in-Common will represent to the City and the Underwriter as follows: (i) It has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (ii) It has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (iii) It is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership of the property owned by it and leased and operated by Rancho Mall, LLC, or its ability to pay its share of special taxes levied in Improvement Area No. 1. (iv) It is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or 38 P655 granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (v) There is no litigation or administrative proceeding of any nature in which it has been served or, to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership of the property owned by it or its ability to pay its share of special taxes levied in Improvement Area No. 1. Representations by Rancho Mall, LLC. In connection with the issuance of the 2013 Bonds, Rancho Mall, LLC will represent to the City and the Underwriter as follows: (i) It has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (ii) It is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the operation of the property leased and operated by it in Improvement Area No. 1. (iii) It is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (iv) There is no litigation or administrative proceeding of any nature in which it has been served or, to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership and operation of the property operated by it in Improvement Area No. 1. 39 P656 Zone 3 Land Ownership. For fiscal year 2013-14, the 14 commercial parcels in Zone 3 are projected to be responsible for 100% of the Special Tax levy in Zone 3. Set forth below is a table showing information about the ownership and use of the 14 properties in Zone 3. Owner APN Use Victoria Gardens Mall LLC (1) APN 0227-464-39 Restaurant APN 0227-464-40 Retail APN 0227-464-41 Retail APN 0227-464-44 Fast Food APN 0227-464-49 Restaurant APN 0227-464-50 Fast Food Monet In Rancho Development LLC APN: 0227-464-57 Retail, Health, Restaurant and Medical businesses Outparcel Pueblo LLC APN 0227-464-43 Retail Gas Station Victoria Rancho LLC APN 0227464-48 Fast Food Restaurant Eternal Legacy Properties LLC APN 0227-464-53 Retail US Bank National Association APN 0227-464-46 Commercial Bank Dayani Trust 11/30/07 APN 0227-464-47 Coffee Retail Wadixon Investment LLC APN 0227-464-52 Parcel leased to Jared: The Galleria of Jewelry, a retail jewelry store Hoef tiger Charitable Remainder Trust APN 0227-464-45 Commercial Bank (1) Merged into Rancho Mall LLC in 2010. Delinquencies The following table is a summary of Special Tax levies, collections and delinquency rates on taxable properties in Improvement Area No. 1 for fiscal years 2003-04 through 2012-13 based on amounts levied and outstanding delinquencies as of June 30 of the fiscal year and as of May 1, 2013. No foreclosure proceedings have been prosecuted by the City in Improvement Area No. 1. 40 P657 Table 6a City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 —Zone 1 Special Tax Collections and Delinquencies Fiscal Years 2004-05 through 2012-13 (Taxable Property) As of End of Fiscal Year As of May 1,2013 Total Number of Remaining Parcels Amount Number of Amount Remaining Remaining Fiscal Amount Subject to Amount Delinquent Delinquent Percent Delinquent Parcels Percent Year Levied Levy Collected 1 (1) (2) Parcels -Delinquent 2 Delinquent Delinquent 2004-05 $87,899 2 $87,899 $ 0 0 0.00% $ 0 0 0.00% 2005-06 3,113 2 3,113 0 0 0.00 0 0 0.00 2006-07 3,113 2 3,113 0 0 0.00 0 0 0.00 2007-08 3,114 2 3,114 0 0 0.00 0 0 0.00 2008-09 23,748 170 22,793 955 10 4.02 0 0 0.00 2009-10 23,748 170 23,056 692 6 2.92 0 0 0.00 2010-11 29,707 216 29,210 498 4 1.68 0 0 0.00 2011-12 29,707 216 29,319 389 3 1.31 389 3 131 2012-13 29,707 216 28,887 820 6 2.76 820 6 2.76 (1) Amount Collected and Amount Delinquent for Fiscal Year 2012-13 represent first and second installment amounts collected and delinquent as of May 1,2013. (2) Amount Delinquent does not include penalties,interest or fees. Source:County of San Bernardino,City of Rancho Cucamonga,as compiled by David Taussig 8 Associates,Inc. 41 P658 Table 6b City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 —Zone 2 Special Tax Collections and Delinquencies Fiscal Years 2004-05 through 2012-13 (Taxable Property) As of End of Fiscal Year As of May 1, 2013 Total Number of Parcels Number of Remaining Remaining Remaining Fiscal Amount Subject to Amount Amount Delinquent Percent Amount Parcels Percent Year Levied Levy Collected 1 Delinquent Parcels Delinquent Delinquent Delinquent Delinquent 2004-05 $ 831,292 20 $ 831,292 $0 0 0.00% $0 0 0.00% 2005-06 1,043,000 42 1,043,000 0 0 0.00 0 0 0.00 2006-07 937,139 3 937,139 0 0 0.00 0 0 0.00 2007-08 918,470 5 918,470 0 0 0.00 0 0 0.00 2008-09 918,470 5 918,470 0 0 0.00 0 0 0.00 2009-10 918,470 5 918,470 0 0 0.00 0 0 0.00 2010-11 918,470 5 918,470 0 0 0.00 0 0 0.00 2011-12 918,470 5 918,470 0 0 0.00 0 0 0.00 2012-13 918,470 5 918,470 0 0 0.00 0 0 0.00 (1) Amount Collected for Fiscal Year 2012-13 represents first and second installment amounts collected as of May 1,2013. Source:County of San Bernardino,City of Rancho Cucamonga,as compiled by David Taussig&Associates,Inc. 42 P659 Table 6c City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 —Zone 3 Special Tax Collections and Delinquencies Fiscal Years 2004-05 through 2012-13 (Taxable Property) As of End of Fiscal Year As of May 1, 2013 Total Number of Parcels Amount Number of Remaining Remaining Remaining Fiscal Amount Subject to Amount Delinquent Delinquent Percent Amount Parcels Percent Year Levied Levy Collected 1 2 Parcels Delinquent Delinquent Delinquent Delinquent 2004-05 $149,853 2 $149,853 $ 0 0 0.00% $0 0 0.00% 2005-06 25,982 16 25,982 0 0 0.00 0 0 0.00 2006-07 47,933 16 45,186 2,747 1 5.73 0 0 0.00 2007-08 108,240 14 105,083 3,157 1 2.92 0 0 0.00 2008-09 108,240 14 108,240 0 0 0.00 0 0 0.00 2009-10 108,240 14 108,240 0 0 0.00 0 0 0.00 2010-11 108,240 14 108,240 0 0 0.00 0 0 0.00 2011-12 108,240 14 108,240 0 0 0.00 0 0 0.00 2012-13 108,240 14 108,240 0 0 0.00 0 0 0.00 (1) Amount Collected and Amount Delinquent for Fiscal Year 2012-13 represent first and second installment amounts collected and delinquent as of May 1,2013. (2) Amount Delinquent does not include penalties,interest or fees. Source:County of San Bernardino,City of Rancho Cucamonga,as compiled by David Taussig&Associates,Inc. 43 P660 Direct and Overlapping Governmental Obligations Taxes, Charges and Assessments. The base property tax rate on property in Improvement Area No. 1 is 1.0247% (including ad valorem tax overrides). Property in Improvement Area No. 1 is also subject, or will be subject, to certain annual charges and assessments (which are billed to property owners on a semi-annual basis). Set forth below is summary of overlapping annual charges and assessments on Taxable Property in Improvement Area No. 1. Table 7 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Taxes, Charges and Assessments for Representative Property 1 Fiscal Year 2012-13 DESCRIPTION Zone 1 Zone 2 Zone 3 REPRESENTATIVE NET TAXABLE ASSESSED VALUE PER PARCEL(1) $325,000 $129,743,210 $3,520,835 Percent FISCAL YEAR 2011-2012 AD VALOREM PROPERTY TAXES(2) of Total AV Amount Amount Amount BASE PROPERTY TAX 1.0000% $3,250 $1,297,432 $35,208 CHAFFEY COMMUNITY COLLEGE DISTRICT G.O.BONDS 0.0111 36 14,401 391 CHAFFEY JOINT UNION HIGH SCHOOL DISTRICT G.O.BONDS 0.0101 33 13,104 356 METROPOLITAN WATER DISTRICT MID-VALLEY G.O.BONDS 0.0035 11 4,541 123 SUBTOTAL AD VALOREM PROPERTY TAX RATEfrAXES $3,330 $1,329,479 $36,078 PARCEL CHARGES,ASSESSMENTS AND SPECIAL TAXES(3) Amount Amount Amount METROPOLITAN WATER DISTRICT WATER STANDBY CHARGE $ 8 $ 364 $ 8 WEST VALLEY MOSQUITO&VECTOR CONTROL CHARGE 7 343 80 CITY OF RANCHO CUCAMONGA LIGHTING DISTRICT No. 1 18 1,285 29 CITY OF RANCHO CUCAMONGA LANDSCAPE DISTRICT No.2 422 NA NA CITY OF RANCHO CUCAMONGA LIGHTING DISTRICT No.3 47 3,410 77 CITY OF RANCHO CUCAMONGA LANDSCAPE DISTRICT No.3B NA 12,758 286 CITY OF RANCHO CUCAMONGA FIRE PROTECTION DISTRICT CFD No.85-1 152 58,587 704 ETIWANDA SCHOOL DISTRICT CFD NO.2007-1 (4) 1,765 NA NA CITY OF RANCHO CUCAMONGA CFD No.2003-01 (4) 130 379,680 6,642 SUBTOTAL PARCEL CHARGES,ASSESSMENTS AND SPECIAL TAXES $2,549 $456,428 $7,826 TOTAL PROPERTY TAXES $5,880 $1,785,907 $43,904 TOTAL EFFECTIVE TAX RATE 1.809% 1.376% 1.247% (1) Based on assessed value information provided by San Bernardino County Assessor's Office as of January 1,2012. (2) Based on the fiscal year 2012-13 ad valorem rates for Tax Rate Area 15082. Rates subject to change in future years. (3) Based on the fiscal year 2012-13 charges identified on San Bernardino County issued property tax bill. Charges subject to change in future years. (4) Based on the fiscal year 2012-13 actual Special Tax. Source:David Taussig&Associates,Inc.,City of Rancho Cucamonga,County of San Bernardino. The overlapping assessment districts and community facilities districts affecting the property in the District are further described below. Community Facilities District No. 85-1 Foothill Fire Protection District. This community facilities district was formed by the Foothill Fire Protection District, predecessor to the Rancho Cucamonga Fire Protection District, to finance operations, maintenance and repair activities carried out by employees of the Rancho Cucamonga 44 P661 Fire Protection District to provide fire protection and suppression services. Special taxes are levied annually only on developed parcels. The special tax on commercial and industrial property is levied at a flat rate per acre plus a rate per building square foot (which can be reduced by $0.01 per building square foot if building has fire sprinkler system). Current special tax rates for industrial property are $119.76 per acre per year, plus $0.080 per building square foot, and rates for commercial property are $119.76 per acre per year, plus $0.065 per building square foot. The special taxes may be increased annually to reflect the CPI index. Victoria Gardens Public Facilities Community Facilities District No. 2007-1 of the Etiwanda School District. This community facilities district was formed by the Etiwanda School District to finance certain school, water and sewer facilities to be owned by the Etiwanda School District, Chaffey Joint Union High School District and Cucamonga Valley Water District. Bonds secured by special taxes levied within this community facilities district were issued in 2007, and then refinanced in 2013, to finance the construction of such facilities. The bonds issued by this community facilities district are scheduled to mature in 2037. As of fiscal year 2012-13, all property in the community facilities district was residential and developed, and the special tax ranged from $1,653.21 per unit to $2,110.43 per unit. The rates will escalate on July 1, 2013, and on July 1 of each subsequent year, by two percent of the maximum amount that could have been levied in the previous year. Street Lighting Maintenance District No. 1. This maintenance district was formed to finance the cost of the energy charges and maintenance of arterial street lighting through the levy of annual assessments. The current annual assessment is $17.77 for a multi-family residence and $35.54 per acre for commercial property. Landscape Maintenance District No. 2. This maintenance district was formed to finance the cost of maintenance of parkways, paseos and an equestrian trail in the Victoria Planned Community portion of the City through the levy of annual assessments. The current annual assessment is $462 for a single-family residence, $323 for a multi- family residence and $340 for a condominium unit. The assessment for commercial/industrial property is $2,185 per acre, the assessment for schools/fire stations is $126 per acre, and the assessment for vacant land is $92 per acre. Street Lighting Maintenance District No. 3. The assessment pays for energy and maintenance of streetlights. The current assessment rate is $47.15 per single-family residence. The commercial rate is $94.30 per acre. Any increase in the assessment must be approved by the property owners. Landscape Maintenance District No. 3B. Landscape Maintenance District No. 3B was formed in 1988 and consists of 1,103 parcels with a total acreage of 2769.73 acres. Landscape Improvements provided in the district may include but are not limited to: turf, ground cover, shrubs and trees, sprinkler and irrigation systems, ornamental lighting, drainage systems, masonry walls, entryway monument, and associated appurtenances. These improvements include: all necessary service; operations; administration; and maintenance required to keep the above-mentioned improvements in a healthy, vigorous, and satisfactory working condition. The City utilizes the services of landscape maintenance contractors and City crews for all regularly scheduled landscape maintenance. The current assessment rate is $352.80 per acre for commercial property. Any increase in the assessment must be approved by the voters. 45 P662 Overlapping Public Debt. Contained within the boundaries of Improvement Area No. 1 are certain overlapping local agencies providing public services and assessing property taxes, assessments, special taxes and other charges on the property in Improvement Area No. 1. Many of these local agencies have outstanding debt. The current and estimated direct and overlapping obligations affecting the property in Improvement Area No. 1 are shown in the following table. The overlapping obligations are not shown on a Zone-specific basis, but the allocation of the overlapping obligations to properties within each Zone is set forth in the preceding tables. Table 8 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 Direct and Overlapping Bonded Debt As of January 1, 2013 Amount of Percent of Levy on Levy on Improve. Taxable Taxable Area No.1 Fiscal Year Parcels in Parcels in Total Debt Share of 2013-13 Total Improve. Improve. Outstanding Total Debt Overlapping District Levy Area No.1 Area No. 1 (1)__ Outstanding Metropolitan Water District Mid-Valley G.O. Bonds $92,246,662 $ 12,196 0.013% $165,085,000 $21,826 Chaffey Community College District G.O. Bonds 10,475,281 38,678 0.369 214,048,348 790,342 Chaffey Joint Union High School District G.O. Bonds 4,690,232 35,194 0.750 182,305,000 1,367,953 Etiwanda School District CFD No.2007-1 (2) 375,576 375,576 100.000 5,250,000 5,250,000 Estimated Share of Overlapping Bonded Debt Allocable to Improve.Area No. 1 $7,430,121 Plus, 2013 Bonds' 14,355,000 Estimated Share of Direct and Overlapping Bonded Debt Allocable to Improve.Area No. 1' $21,785,121 Preliminary;subject to change. (1) As of June 1,2013. (2) Overlaps only Zone 1 of Improvement Area No.1. Source:David Taussig&Associates,Inc.,County of San Bernardino. 46 P663 Scheduled Debt Service Coverage The following tables show scheduled debt service coverage on the 2013 Bonds in each Zone, and in the aggregate, based on maximum Special Tax Revenues, assuming 0% Special Tax delinquencies and that the maximum allowed amount of Special Tax Revenues is deposited into the Administrative Expense Fund for each year Bond Year shown. See "SECURITY FOR THE 2013 BONDS - General." The City can provide no assurances that Special Taxes will be collected when levied, as assumed in this table. 47 P664 Table 9a City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 -Zone 1 Scheduled Debt Service Coverage (Taxable Property) Estimated Estimated Developed Undeveloped Coverage Coverage Property Property Gross Priority Debt from from All Special Tax Special Tax Special Administrative Service on Developed Taxable Year Revenues Revenues Tax Expense 2013 Bonds Property Property Ending (1) (2) Revenues Amount(3) (4)' (5) (6)' 2014 $68,380 $28,055 $ 96,435 $3,277 $62,648 103.92% 148.70% 2015 69,747 28,616 98,363 3,342 64,234 103.38 147.93 2016 71,142 29,189 100,331 3,409 65,576 103.29 147.80 2017 72,565 29,772 102,337 3,477 67,108 102.95 147.31 2018 74,016 30,368 104,384 3,547 68,838 102.37 146.48 2019 75,497 30,975 106,472 3,618 70,369 102.15 146.16 2020 77,007 31,595 108,601 3,690 71,755 102.18 146.21 2021 78,547 32,226 110,773 3,764 73,656 101.53 145.28 2022 80,118 32,871 112,989 3,839 75,701 100.76 144.19 2023 81,720 33,528 115,248 3,916 76,852 101.24 144.87 2024 83,354 34,199 117,553 3,994 78,802 100.71 144.11 2025 85,022 34,883 119,904 4,074 80,484 100.58 143.92 2026 86,722 35,581 122,303 4,156 82,614 99.94 14101 2027 88,456 36,292 124,749 4,239 84,480 99.69 142.65 2028 90,226 37,018 127,244 4,323 86,407 99.42 142.26 2029 92,030 37,758 129,788 4,410 88,032 99.53 142.42 2030 93,871 38,514 132,384 4,498 90,350 98.92 141.54 2031 95,748 39,284 135,032 4,588 92,047 99.04 141.71 2032 97,663 40,070 137,733 4,680 94,049 98.87 141.47 2033 99,616 40,871 140,487 4,773 96,076 98.72 141.26 ' Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2% assuming no further development. Pursuant to Section 53321(d) of the Government Code, the Special Tax levied against any Assessor's parcel for which an occupancy permit for private residential use has been issued shall not be increased as a consequence of delinquency of default by the owner of any other Assessor's parcel within the District by more than ten percent above the amount that would have been levied in the fiscal year had there never been any such delinquencies of defaults. (2) Based on the anticipated Assigned Special Tax revenues from 5.33 acres of property classified as Undeveloped Property for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2% assuming no further development. (3) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of$40,000, escalating at 2%annually, multiplied by the Zone 1 Allocation of 6.72%. (4) Based on the debt service on the 2013 Bonds, multiplied by the Zone 1 Allocation of 6.72%. (5) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. (6) Gross Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig &Associates, Inc., Stifel, Nicolaus&Company, Incorporated. 48 P665 Table 9b City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 -Zone 2 Scheduled Debt Service Coverage (Taxable Property) Estimated Estimated Developed Undeveloped Coverage Coverage Property Property Priority Debt from from All Special Tax Special Tax Gross Administrative Service on Developed Taxable Year Revenues Revenues Special Tax Expense 2013 Bonds Property Property Ending (1) (2) Revenues Amount(3) (4)' (5)' IV 2014 $3,865,440 $282,265 $4,147,705 $39,856 $ 762,025 502.03% 539.07% 2015 3,942,748 287,910 4,230,659 40,653 781,322 499.42 536.27 2016 4,021,603 293,669 4,315,272 41,466 797,650 498.98 535.80 2017 4,102,035 299,542 4,401,577 42,296 816,286 497.34 534.04 2018 4,184,076 305,533 4,489,609 43,142 837,324 494.54 531.03 2019 4,267,758 311,644 4,579,401 44,005 855,946 493.46 529.87 2020 4,353,113 317,876 4,670,989 44,885 872,804 493.61 530.03 2021 4,440,175 324,234 4,764,409 45,782 895,932 490.48 526.67 2022 4,528,979 330,719 4,859,697 46,698 920,801 486.78 522.70 2023 4,619,558 337,333 4,956,891 47,632 934,809 489.08 525.16 2024 4,711,949 344,080 5,056,029 48,585 958,524 486.52 522.41 2025 4,806,188 350,961 5,157,149 49,556 978,985 485.87 521.72 2026 4,902,312 357,980 5,260,292 50,547 1,004,896 482.81 518.44 2027 5,000,358 365,140 5,365,498 51,558 1,027,594 481.59 517.12 2028 5,100,365 372,443 5,472,808 52,589 1,051,033 480.27 515.70 2029 5,202,373 379,892 5,582,264 53,641 1,070,794 480.83 516.31 2030 5,306,420 387,490 5,693,910 54,714 1,098,994 477.86 513.12 2031 5,412,549 395,239 5,807,788 55,808 1,119,634 478.44 513.74 2032 5,520,800 403,144 5,923,944 56,925 1,143,977 477.62 512.86 2033 5,631,216 411,207 6,042,423 58,063 1,168,637 476.89 512.08 Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2% assuming no further development. (2) Based on the anticipated Assigned Special Tax revenues from 6.38 acres of property classified as Undeveloped Property for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2%assuming no further development. (3) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of$40,000, escalating at 2% annually, multiplied by the Zone 2 Allocation of 81.74%. (4) Based on the debt service on the 2013 Bonds, multiplied by the Zone 2 Allocation of 81.74%. (5) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. (6) Gross Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig&Associates, Inc.; Stifel, Nicolaus&Company, Incorporated. 49 P666 Table 9c City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 -Zone 3 Scheduled Debt Service Coverage (Taxable Property) Estimated Developed Coverage Property Priority Debt from Special Tax Administrative Service on Developed Year Revenues Expense 2013 Bonds Property Ending (1) Amount(2) (3)` (4)` 2014 $165,284 $5,627 $107,582 148.40% 2015 168,590 5,739 110,307 147.63 2016 171,961 5,854 112,612 147.50 2017 175,401 5,971 115,243 147.02 2018 178,909 6,091 118,213 146.19 2019 182,487 6,213 120,842 145.87 2020 186,137 6,337 123,222 145.92 2021 189,859 6,464 126,487 144.99 2022 193,656 6,593 129,998 143.90 2023 197,530 6,725 131,976 144.58 2024 201,480 6,859 135,324 143.82 2025 205,510 6,996 138,212 143.63 2026 209,620 7,136 141,871 142.72 2027 213,812 7,279 145,075 142.36 2028 218,089 7,425 148,384 141.97 2029 222,450 7,573 151,174 142.14 2030 226,899 7,724 155,155 141.26 2031 231,437 7,879 158,069 141.43 2032 236,066 8,037 161,506 141.19 2033 240,787 8,197 164,987 140.97 ` Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2%. (2) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of$40,000, escalating at 2%annually, multiplied by the Zone 3 Allocation of 11.54%. (3) Based on the debt service on the 2013 Bonds, multiplied by the Zone 3 Allocation of 11.54%. (4) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig&Associates, Inc.; Stifel, Nicolaus&Company, Incorporated. 50 P667 In reviewing Table 9d, it is important to be aware that each Zone is responsible only for debt service on the percentage of outstanding 2013 Bonds allocated to it, and Special Taxes may not be levied in one Zone in order to provide for amounts to pay debt service on outstanding 2013 Bonds allocated to another or to replenish the Reserve Fund following the use of moneys in the Reserve Fund to pay debt service on the 2013 Bonds as a result of Special Tax delinquencies by property owners in a different Zone. See "SPECIAL RISK FACTORS — Impact of Zone Allocation." 51 P668 Table 9d City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1 -All Zones Scheduled Debt Service Coverage (Taxable Property) Estimated Estimated Developed Undeveloped Coverage Coverage Property Property Gross Priority Debt from from All Special Tax Special Tax Special Administrative Service on Developed Taxable Year Revenues Revenues Tax Expense 2013 Bonds Property Property Ending (1) (2) Revenues Amount(3) (4)` (5)` (6)` 2014 $4,099,103 $310,320 $4,409,423 $48,760 $932,255 434.47% 467.75% 2015 4,181,085 316,527 4,497,612 49,735 955,863 432.21 465.33 2016 4,264,707 322,857 4,587,564 50,730 975,838 431.83 464.92 2017 4,350,001 329,314 4,679,315 51,744 998,638 430.41 463.39 2018 4,437,001 335,901 4,772,902 52,779 1,024,375 427.99 460.78 2019 4,525,741 342,619 4,868,360 53,835 1,047,156 427.05 459.77 2020 4,616,256 349,471 4,965,727 54,911 1,067,781 427.18 459.91 2021 4,708,581 356,460 5,065,041 56,010 1,096,075 424.48 457.00 2022 4,802,753 363,590 5,166,342 57,130 1,126,500 421.27 453.55 2023 4,898,808 370,861 5,269,669 58,272 1,143,638 423.26 455.69 2024 4,996,784 378,279 5,375,063 59,438 1,172,650 421.04 453.30 2025 5,096,720 385,844 5,482,564 60,627 1,197,681 420.49 452.70 2026 5,198,654 393,561 5,592,215 61,839 1,229,381 417.84 449.85 2027 5,302,627 401,432 5,704,059 63,076 1,257,150 416.78 448.71 2028 5,408,680 409,461 5,818,141 64,337 1,285,825 415.64 447.48 2029 5,516,853 417,650 5,934,503 65,624 1,310,000 416.12 448.01 2030 5,627,190 426,003 6,053,193 66,937 1,344,500 413.56 445.24 2031 5,739,734 434,523 6,174,257 68,275 1,369,750 414.05 445.77 2032 5,854,529 443,214 6,297,742 69,641 1,399,531 413.34 445.01 2033 5,971,619 452,078 6,423,697 71,034 1,429,700 412.71 444.34 Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2% assuming no further development. Pursuant to Section 53321(d) of the Government Code, the Special Tax levied against any Assessors parcel for which an occupancy permit for private residential use has been issued shall not be increased as a consequence of delinquency of default by the owner of any other Assessor's parcel within the District by more than ten percent above the amount that would have been levied in the fiscal year had there never been any such delinquencies of defaults. (2) Based on the anticipated Assigned Special Tax revenues from (i) 5.33 acres of property classified as Undeveloped Property within Zone 1 for fiscal year 2013-2014, and (ii) 6.38 acres of property classified as Undeveloped Property within Zone 2 for fiscal year 2013-2014. Special Taxes for all subsequent years are escalated annually at 2%assuming no further development. (3) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of $40,000, escalating at 2% annually. (4) Based on the debt service on the 2013 Bonds. (5) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. (6) Gross Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig&Associates, Inc.; Stifel, Nicolaus&Company, Incorporated. 52 P669 SPECIAL RISK FACTORS The following is a description of certain risk factors affecting Improvement Area No. 1, the property owners in Improvement Area No. 1, the parcels subject to the levy of Special Taxes and the payment of and security for the 2013 Bonds. The following discussion of risks is not meant to be a complete list of the risks associated with the purchase of the 2013 Bonds and does not necessarily reflect the relative importance of the various risks. Potential investors are advised to consider the following factors along with all other information in this Official Statement in evaluating the investment quality of the 2013 Bonds. There can be no assurance that other risk factors will not become material in the future. Concentration of Property Ownership Failure of any significant landowner to pay the annual Special Taxes when due could result in the rapid, total depletion of the Reserve Fund prior to replenishment from the resale of the property upon a foreclosure or otherwise or prior to delinquency redemption after a foreclosure sale, if any. In that event, there could be a default in payments of the principal of and interest on the 2013 Bonds. The following paragraphs briefly summarize concentration of property ownership in each Zone: Zone 1, which is responsible for 6.72% of the debt service on the 2013 Bonds, is built-out with 215 single family attached condominium units, and there is limited property owner concentration. Zone 2, which is responsible for payment of 81.74% of the debt service on the 2013 Bonds, is primarily built-out; four of the five parcels are owned by the Tenants-in- Common, leased and operated by Rancho Mall, LLC, and developed as the Victoria Gardens Mall. They are responsible for all the projected Special Tax levy for Fiscal Year 2013-14. Zone 3, which is responsible for 11.54% of the debt service on the 2013 Bonds, is built-out with 14 commercial parcels. See Table 5, "Summary of Special Tax Payers," under "IMPROVEMENT AREA No. 1 — Land Owners." Risks Associated with Commercial Real Estate Properties Property in Improvement Area No. 1 is primarily commercial in nature. There are certain significant risks associated with commercial real estate properties, as discussed in the following paragraphs. Dependence on Tenants. The ability of commercial properties to pay the Special Taxes may depend on the ability of its tenants to meet their financial obligations under their leases. In the event of defaults by tenants, delays may be experienced in enforcing rights and substantial costs may be incurred in protecting the property owner's investment. Furthermore, at any time, a tenant could seek protection under bankruptcy laws, which could result in the termination of the tenant's lease and an interruption or loss of rental income. The bankruptcy of 53 P670 a major tenant, followed by the closing of its business or the leasing of its space to a different tenant or for a different use, could adversely affect the desirability of the property and result in a decrease in consumer traffic and sales income which would adversely affect the ability of the other tenants to meet their obligations under their leases. Tenants-in-Common have informed the City that some leases may have "co-tenancy' clauses, which give tenants the right to vacate their premises, terminate their leases or modify their lease payments if other tenants cease operations or if specified percentages of leasing or occupancy are not maintained. There are several different outcomes that may result from the enforcement of co-tenancy clauses, some of which may materially adversely affect the willingness or ability of the Tenants-in-Common to pay special taxes. Factors Affecting Economic Performance and Value of Commercial Properties. The economic performance and value of the Taxable Property in Improvement Area No. 1 will be affected by a number of factors, including national economic conditions, regional economic conditions (which may be adversely affected by plant closings, industry slow-downs and other factors), local real estate conditions such as an oversupply of retail space or a reduction in the demand for retail space in the area, the attractiveness of the retail property to tenants, competition from other retailers (including on-line retailers), the quality of maintenance, the cost of insurance and management services, and increased operating costs. Other factors which may adversely affect the economic performance and value of the Taxable Property in Improvement Area No. 1 include changes in government regulations and other laws, rules and regulations governing real estate, zoning or taxes, increases in interest rates, the availability of financing and potential liability under environmental and other laws. Due to these factors and other risks, there can be no assurance that commercial property in Improvement Area No. 1 will remain economically viable throughout the term of the 2013 Bonds, or that the owners of the Taxable Property in Improvement Area No. 1 will continue to have the ability throughout the term of the 2013 Bonds to pay the Special Taxes which will be levied on the Taxable Property. Impact of Zone Allocation The Rate and Method divides the property in Improvement Area No. 1 into three Zones and allocates a portion of the Outstanding 2013 Bonds to each Zone. Each Zone is responsible only for debt service on the 2013 Bonds allocable to such Zone, and Special Taxes cannot be levied in one Zone within Improvement Area No. 1 in order to provide amounts to pay debt service on Bonds allocable to another Zone in Improvement Area No. 1. Therefore, in the event that the Special Taxes collected within a Zone within Improvement Area No. 1 were insufficient to pay debt service on the 2013 Bonds allocated to such Zone, the Special Tax levy in the remaining Zones within Improvement Area No. 1 could not be increased in order to offset such insufficiency (even if the Special Taxes were being levied in such remaining Zones at less than the maximum tax rates) and, upon depletion of the Reserve Fund, there could be a default in the payment of the 2013 Bonds. See "SECURITY FOR THE 2013 BONDS — Summary of Rate and Method - Determination of Zone Special Tax Requirement." Pursuant to the Fiscal Agent Agreement, a single Reserve Fund is established for the 2013 Bonds. Moneys on deposit in the Reserve Fund are available for paying the debt service on the 2013 Bonds in the event that there are insufficient amounts for such purpose in the Bond Fund. A draw on the Reserve Fund could occur as the result of Special Tax delinquencies in any Zone within Improvement Area No. 1. However, pursuant to the Rate and Method, Special Taxes may be levied within a Zone in Improvement Area No. 1 for the purpose of replenishing 54 P671 the Reserve Fund only if and to the extent that amounts were withdrawn from the Reserve Fund as a result of delinquencies in such Zone. Therefore, if a draw on the Reserve Fund were to occur as the result of Special Tax delinquencies in one Zone, the Special Tax levy in the other Zones in Improvement Area No. 1 could not be increased in order to replenish the Reserve Fund (even if the Special Taxes were being levied in such remaining Zones at less than the maximum tax rates). See "SECURITY FOR THE 2013 BONDS — Summary of the Rate and Method - Determination of Zone Special Tax Requirement." The amount of the Zone Special Tax Requirement for a Zone in Improvement Area No. 1 is a function of the amount of Outstanding 2013 Bonds allocated to such Zone pursuant to the Rate and Method. The allocation of Outstanding 2013 Bonds to a Zone in Improvement Area No. 1 pursuant to the Rate and Method is based on (a) such Zone's share of the cost of the Authorized Facilities financed from Bond proceeds, determined at the time of issuance of the 2013 Bonds, and (b) the amount of the 2013 Bonds, if any, that have been redeemed or defeased as a result of the prepayment of Special Taxes on parcels in such Zone. Therefore, the amount of Outstanding 2013 Bonds allocated to a Zone within Improvement Area No. 1, and the share of debt service on the Outstanding 2013 Bonds for which such Zone is responsible, will change if Special Taxes are prepaid. See "SECURITY FOR THE 2013 BONDS — Summary of the Rate and Method - Determination of Zone Special Tax Requirement." Payment of the Special Tax Is Not a Personal Obligation The owners of the parcels in Improvement Area No. 1 are not personally obligated to pay the Special Tax. Rather, the Special Tax is an obligation that is secured only by a lien against the parcels on which it is levied. If the value of the taxable parcels is not sufficient to secure fully the payment of the Special Tax, the District has no recourse against the landowners. No General Obligation of the City or the District The District's obligations under the 2013 Bonds and under the Fiscal Agent Agreement are limited obligations of the District with respect to Improvement Area No. 1 and are payable solely from and secured solely by the Special Tax Revenues and amounts in the Special Tax Fund, the Bond Fund and the Reserve Fund. The 2013 Bonds are neither general or special obligations of the District or Improvement Area No. 1 nor general obligations of the City, but are limited obligations of the District with respect to Improvement Area No. 1 payable solely from the revenues and funds pledged therefor and under the Fiscal Agent Agreement. None of the faith and credit of the District, Improvement Area No. 1, the City or the State of California or of any of their respective political subdivisions is pledged to the payment of the 2013 Bonds. Property Value If a landowner defaults in the payment of the Special Tax, the only legal remedy is the institution of a superior court action to foreclose on the delinquent taxable parcel in an attempt to obtain funds with which to pay the Special Tax. The value of the taxable parcels in Improvement Area No. 1 could be adversely affected by economic factors beyond the District's control, including, without limitation, (i) adverse changes in local market conditions, such as changes in the market value of real property in the vicinity of Improvement Area No. 1, the supply of or demand for competitive properties in such area, and the market value of property in the event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relating to 55 P672 endangered species and hazardous materials) and fiscal policies; and (iii) natural disasters (including, without limitation, wildfire, earthquakes and floods), which may result in uninsured losses. See "—Natural Disasters." No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of such sale will be sufficient to pay the delinquent Special Tax installment. Although the Act authorizes the City to cause such an action to be commenced and diligently pursued to completion, the Act does not specify any obligation of the City with regard to purchasing or otherwise acquiring any lot or parcel of property sold at the foreclosure sale in any such action if there is no other purchaser at such sale. The City is not obligated and does not expect to be a bidder at any such foreclosure sale. See "—Proceeds of Foreclosure Sale." Exempt Properties Certain properties are exempt from the Special Tax in accordance with the Rate and Method. In addition, the Act provides that properties or entities of the state, federal or local government are exempt from the Special Tax; provided, however, that property within Improvement Area No. 1 acquired by a public entity through a negotiated transaction, or by gift or devise, that is not otherwise exempt from the Special Tax, will continue to be subject to the Special Tax. It is possible that property acquired by a public entity following a tax sale or foreclosure based upon failure to pay taxes could become exempt from the Special Tax. In addition, the Act provides that if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property, for Outstanding 2013 Bonds only, is to be treated as if it were a special assessment. The constitutionality and operation of these provisions of the Act have not been tested. See "SECURITY FOR THE 2013 BONDS -The Special Tax." In particular, insofar as the Act requires payment of the Special Tax by a federal entity acquiring property within Improvement Area No. 1, it may be unconstitutional. If for any reason property within Improvement Area No. 1 becomes exempt from taxation by reason of ownership by a nontaxable entity such as the federal government or another public agency, subject to the limitation of the Maximum Rate, the Special Tax will be reallocated to the remaining taxable properties within the applicable Zone. This would result in the owners of such property paying a greater amount of the Special Tax and could have an adverse impact upon the timely payment of the Special Tax. Moreover, if a substantial portion of land within Improvement Area No. 1 becomes exempt from the Special Tax because of public ownership, or otherwise, the maximum rate that could be levied upon the remaining acreage might not be sufficient to pay principal of and interest on the 2013 Bonds when due and a default would occur with respect to the payment of such principal and interest. The Act further provides that no other properties or entities are exempt from the Special Tax unless the properties or entities are expressly exempted in a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax. Parity Taxes and Special Assessments The Special Taxes and any related penalties will constitute liens against the taxable parcels in Improvement Area No. 1 until they are paid. Such lien is on a parity with all special taxes and special assessments levied by other agencies and is coequal to and independent of the lien for general property taxes regardless of when they are imposed upon the taxable parcel. 56 P673 The Special Taxes have priority over all existing and future private liens imposed on the property. The District, however, has no control over the ability of other entities and districts to issue indebtedness secured by special taxes or assessments payable from all or a portion of the taxable parcel within Improvement Area No. 1 subject to the levy of Special Taxes. In addition, the landowners within Improvement Area No. 1 may, without the consent or knowledge of the District, petition other public agencies to issue public indebtedness secured by special taxes or assessments, and any such special taxes or assessments may have a lien on such property on a parity with the Special Taxes. The imposition of additional indebtedness could reduce the willingness and the ability of the property owners within Improvement Area No. 1 to pay the Special Taxes when due. Insufficiency of Special Taxes In order to pay debt service on the 2013 Bonds, it is necessary that the Special Taxes levied against Taxable Property within Improvement Area No. 1 be paid in a timely manner. The Fiscal Agent has established the Reserve Fund in an amount equal to the Reserve Requirement to pay debt service on the 2013 Bonds to the extent Special Taxes are not paid on time and other funds are not available. See 'SECURITY FOR THE 2013 BONDS—Reserve Fund" and Appendix C–"Summary of the Fiscal Agent Agreement." Under the Fiscal Agent Agreement, the District has covenanted to maintain in the Reserve Fund an amount equal to the Reserve Requirement; subject, however, to the limitations that the District may not levy the Special Tax in any fiscal year at a rate in excess of the Maximum Special Tax rates permitted under the Rate and Method. See "SECURITY FOR THE 2013 BONDS—Special Taxes." Additionally, pursuant to Government Code Section 53321(d), in the case of any special tax to pay for public facilities and to be levied against any parcel used for private residential purposes, under no circumstances will the Special Tax levied in any fiscal year against a private residential parcel be increased as a consequence of delinquency or default by the owner or owners of any other parcel or parcels within the same Zone by more than 10% above the amount that would have been levied in that fiscal year had there never been any such delinquencies or defaults. Consequently, if a delinquency occurs, the District may be unable to replenish the Reserve Fund to the Reserve Requirement due to the limitation of the Maximum Special Tax rates. If such defaults were to continue in successive years, the Reserve Fund could be depleted and a default on the 2013 Bonds would occur if proceeds of a foreclosure sale did not yield a sufficient amount to pay the delinquent Special Taxes. The District has made certain covenants regarding the institution of foreclosure proceedings by the City to sell any property with delinquent Special Taxes in order to obtain funds to pay debt service on the 2013 Bonds. See "SECURITY FOR THE 2013 BONDS - Covenant for Superior Court Foreclosure." If foreclosure proceedings were ever instituted, any mortgage or deed of trust holder could, but would not be required to, advance the amount of delinquent Special Taxes to protect its security interest. Tax Delinquencies Under provisions of the Act, the Special Taxes, from which funds necessary for the payment of principal of, and interest on, the 2013 Bonds are derived, are being billed to the taxable parcels within the District on the regular property tax bills sent to owners of the parcels. Such Special Tax installments are due and payable, and bear the same penalties and interest for non-payment, as do regular property tax installments. Special Tax installment payments 57 P674 cannot be made separately from property tax payments. Therefore, the unwillingness or inability of a property owner to pay regular property tax bills as evidenced by property tax delinquencies may also indicate an unwillingness or inability to make regular property tax payments and Special Tax installment payments in the future. See "SECURITY FOR THE 2013 BONDS— Reserve Fund" and "-Covenant for Superior Court Foreclosure" for a discussion of the provisions which apply, and procedures which the District is obligated to follow under the Fiscal Agent Agreement, in the event of delinquency in the payment of Special Tax installments. See also "THE DISTRICT"for historical Special Tax delinquency history. Risks Associated with Private Loan Some or all of the real property in Improvement Area No. 1 is subject to and secures a private loan; as a matter of law, the lien securing the private loan is junior in priority to the lien securing the Special Tax obligation. In the event of a default by the property owner on its loan, whether as a result of a default in the payment of debt service on the loan or other material provisions of the loan agreement, the property's ownership could be transferred to the lender as a result of foreclosure or otherwise. This could impact the management of the property and result in a failure to pay Special Taxes as they become due. With respect to the property in Zone 2, which is responsible for 81.74% of the Special Taxes in Improvement Area No. 1, please see the description of the private loans and the scheduled maturity dates in "IMPROVEMENT AREA NO. 1 – Land Owners." Bankruptcy Delays The payment of the Special Tax and the ability of the City, on behalf of the District, to commence a superior court action to foreclose the lien of a delinquent unpaid Special Tax, as discussed in "SECURITY FOR THE 2013 BONDS," may be limited by bankruptcy, insolvency or other laws generally affecting creditors' rights or by the laws of the State of California relating to judicial foreclosure. Any legal opinion to be delivered concurrently with the delivery of the 2013 Bonds (including Bond Counsel's approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases. Although bankruptcy proceedings would not cause the Special Taxes to become extinguished, bankruptcy of a property owner or any other person claiming an interest in the property could result in a delay in superior court foreclosure proceedings and could result in the possibility of Special Tax installments not being paid in part or in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the 2013 Bonds. Proceeds of Foreclosure Sales Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of any Special Tax, the City Council, as the legislative body of the District, may order that the Special Taxes be collected by a superior court action to foreclose the lien within specified time limits. The District has covenanted in the Fiscal Agent Agreement that the City will, under certain circumstances, commence such a foreclosure action. See "SECURITY FOR THE 2013 BONDS—Covenant for Superior Court Foreclosure." 58 P675 No assurances can be given that a taxable parcel in Improvement Area No. 1 that would be subject to a judicial foreclosure sale for delinquent Special Taxes will be sold or, if sold, that the proceeds of such sale will be sufficient to pay the delinquent Special Tax installment. Although the Act authorizes the District to cause such an action to be commenced and diligently pursued to completion, the Act does not specify any obligation of the District with regard to purchasing or otherwise acquiring any lot or parcel of property sold at the foreclosure sale in any such action if there is no other purchaser at such sale, and the District has not in any way agreed nor does it expect to be such a bidder. In a foreclosure proceeding, a judgment debtor (i.e., the property owner) has 140 days from the date of service of the notice of levy in which to redeem the property to be sold and may have other redemption rights afforded by law. If a judgment debtor fails to so redeem and the property is sold, his only remedy is an action to set aside the sale, which must be brought within 90 days of the date of sale if the purchaser at the sale was the judgment creditor. If a foreclosure sale is thereby set aside, the judgment is revived and the judgment creditor is entitled to interest on the revived judgment as if the sale had not been made. If foreclosure proceedings were ever instituted, any holder of a mortgage or deed of trust on the affected property could, but would not be required to, advance the amount of tie delinquent Special Tax installment to protect its security interest. In the event such superior court foreclosure or foreclosures are necessary, there could be a delay in principal and interest payments to the owners of the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the District of the proceeds of the foreclosure sale, if any. Judicial foreclosure actions are subject to the normal delays associated with court cases and may be further slowed by bankruptcy actions and other factors beyond the control of the District and City, including delay due to crowded local court calendars or legal tactics and, in any event could take several years to complete. In particular, bankruptcy proceedings involving the Landowner or any other owner of a taxable parcel in Improvement Area No. 1 could cause a delay, reduction or elimination in the flow of Special Tax Revenues to the Fiscal Agent. See "—Bankruptcy Delays." Natural Disasters The value of the Taxable Property in the future can be adversely affected by a variety of natural occurrences, particularly those that may affect infrastructure and other public improvements and private improvements on the Taxable Property and the continued habitability and enjoyment of such private improvements. Such occurrences include, without limitation, wildfire, earthquakes and floods. One or more of such natural disasters could occur and could result in damage to improvements of varying seriousness. The damage may entail significant repair or replacement costs, and that repair or replacement may never occur either because of the cost, or because repair or replacement will not facilitate habitability or other use, or because other considerations preclude such repair or replacement. Under any of these circumstances, the value of the Taxable Property may well depreciate or disappear, or a substantial portion of the property owners may be unwilling or unable to pay the Special Taxes when due. The following paragraphs contain excerpts from the City's General Plan. Seismic Risk. While many natural and man-made hazards have the potential to impact the City, the event with the greatest potential for loss of life, property, and economic damage is an earthquake. The hazards associated with an earthquake in the City include ground shaking, 59 P676 fault rupture, landslides and foundation failures caused by liquefaction or settlement. Earthquakes can also trigger many secondary effects such as landslides and rock falls, urban fires, building collapse, water tank or dam failures, disruption of essential facilities and systems (water, sewer, gas, electricity, transportation, and communications), and hazardous materials releases. The City is located near two of California's most active faults, the San Andreas Fault and San Jacinto Fault. These faults are thought to have the highest probability of generating a large earthquake in the near future (up to 7.3 and 6.7 magnitude, respectively). While activity on the San Andreas Fault and San Jacinto Fault is considered more likely, a major earthquake (7.0 magnitude) on the Cucamonga Fault is assumed to be the worst-case earthquake scenario for the City. Ground displacements of up to 9 feet could occur along the fault, intense ground shaking could last more than 30 seconds, and losses could be extensive. Another major fault, traversing the City in a northeast direction, is the Red Hill Fault. This fault consists of three segments: (1) the Etiwanda Avenue Fault Scarp, which has been shown to be clearly active; (2) a southern section at the base of Red Hill with uncertain activity; and (3) a probable central segment that has not yet been located. The Etiwanda Avenue Fault Scarp (potential for 6.5 magnitude earthquake) is considered capable of ground shaking at an intensity that presents unacceptable risks to structures. The other two segments, not yet detected, could induce further damage. In 2002, the RMA Group was engaged by Forest City Development to complete a geotechnical investigation of the property within Improvement Area No. 1. The report states that since Improvement Area No. 1 is not located within the boundaries of an Earthquake Fault Zone and no faults are known to pass through Improvement Area No. 1, surface fault rupture within Improvement Area No. 1 is considered unlikely. Geologic Risk. The San Gabriel Mountains are among the fastest rising and fastest disintegrating mountain ranges in the world. Due to the City's proximity to the mountain range, these rapid changes make the City susceptible to geologic hazards including debris flows and falling rocks due to erosion of the steep slopes, concentration of precipitation from storms, and rapid stream flow from mountain streams, leading to increased potential for land subsidence in certain soil conditions. Flood Risk. The City, due to its location at the base of the San Gabriel Mountains, has a history of flooding. Many of the streets in the northern portion of the City have been known to flood. Comprehensive storm drain improvements and flood control projects have reduced the threat of floods somewhat, but not entirely. An unusually large storm and flash flooding can create flooding hazards within the City. The unpredictable range in seasonal rainfall that is typical of Southern California, coupled with the location near the San Gabriel Mountains, makes the City vulnerable to flooding during the winter storm season. To prepare and mitigate hazards from flooding, the City participates in the National Flood Insurance Program. Flood Insurance Rate Maps, or FIRMs, are prepared by the Federal Emergency Management Agency ("FEMA") to identify potential flood zones. The majority of the City is designated as located inside the 500-year floodplain in the minimum hazard area, with less than 60 P677 a 0.2% annual chance of flood hazard. Dam Inundation. Dam or catch basin failure could occur as a result of an earthquake, erosion, design flaw, or water overflow during storms, causing inundation in certain parts of the City. California law requires dam owners to provide the Governor's Office of Emergency Services with an inundation map showing the extent of damage to life and property that would occur given a complete and sudden dam failure at full capacity. There are four debris and water catch basins located within the City, and a small portion of the southwestern part of the City could be affected by a breach of the San Antonio Dam in Upland. The dam is a flood control and water conservation project constructed and operated by the U.S. Army Corps of Engineers. The Reservoir Hazard Study for the Cucamonga Valley Water District ("CVWD"), dated March 1989, evaluated the performance of CVWD's tanks under seismic loads from earthquakes on the nearby Cucamonga Fault and Red Hill Fault. Should a large earthquake occur on either of these faults, the study indicates than none of CVWD's water tanks will survive undamaged. Most (14) will suffer only broken pipe connections, 10 will probably suffer tears or seam breaks, and 2 will likely collapse. These findings are significant in their impact on fire flow and emergency storage following an earthquake. Inundation studies based on failures of CVWD's water tanks indicate that four of the projected reservoir failures will impact land that is currently vacant, three are expected to inundate one or two structures, and one reservoir site may inundate as many as 15 residences. Hazardous Substances The presence of hazardous substances on a parcel may result in a reduction in the value of a parcel. In general, the owners and operators of a parcel may be required by law to remedy conditions of the parcel relating to releases or threatened releases of hazardous substances. The Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as "CERCLA" or the "Superfund Act," is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar. Under many of these laws, the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect, therefore, should any of the taxed parcels be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition just as is the seller. The City has not independently verified, but is not aware of, the presence of any hazardous substances within Improvement Area No. 1. Disclosure to Future Purchasers The willingness or ability of an owner of a parcel to pay the Special Tax, even if the value of the property is sufficient to justify payment, may be affected by whether or not the owner was given due notice of the Special Tax authorization at the time the owner purchased the parcel, was informed of the amount of the Special Tax on the parcel should the Special Tax be levied at the maximum tax rate and, at the time of such a levy, has the ability to pay it as well 61 P678 as pay other expenses and obligations. The District has caused notices of the Special Tax to be recorded in the Office of the Recorder for the County against each parcel in Improvement Area No. 1. Although title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider such Special Tax obligation when purchasing a property within Improvement Area No. 1 or lending money secured by the property, as applicable. California Civil Code Section 1102.6b requires that, in the case of transfers, the seller must at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure by an owner of the property to comply with the above requirements, or failure by a purchaser or lessor to consider or understand the nature and existence of the Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Special Tax when due. FDIC/Federal Government Interests in Properties General. The ability of the City, on behalf of the District, to foreclose the lien of delinquent unpaid Special Tax installments may be limited with regard to properties in which the Federal Deposit Insurance Corporation (the "FDIC"), the Drug Enforcement Agency, the Internal Revenue Service, or other federal agency has or obtains an interest. Federal courts have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest. The supremacy clause of the United States Constitution reads as follows: "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding." This means that, unless Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Special Taxes within Improvement Area No. 1 but does not pay taxes and assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments. Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the District wishes to foreclose on the parcel as a result of delinquent Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Taxes and preserve the federal government's mortgage interest. In Rust v. Johnson (9th Circuit; 1979) 597 F.2d 174, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association ("FNMA") is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States. The District has not undertaken to determine whether any federal governmental entity currently has, or is likely to acquire, any interest (including a mortgage interest) in any of the 62 P679 parcels subject to the Special Taxes within Improvement Area No. 1, and therefore expresses no view concerning the likelihood that the risks described above will materialize while the 2013 Bonds are outstanding. FDIC. In the event that any financial institution making any loan which is secured by real property within Improvement Area No. 1 is taken over by the FDIC, and prior thereto or thereafter the loan or loans go into default, resulting in ownership of the property by the FDIC, then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Special Taxes may be limited. The FDIC's policy statement regarding the payment of state and local real property taxes (the "Policy Statement") provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property's value, and that the FDIC is immune from real property taxes assessed on any basis other than property value. According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution's affairs, unless abandonment of the FDIC's interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (including interest) on FDIC-owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC's consent. In addition, the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC's consent. The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes, including special assessments, on property in which it has a fee interest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Mello-Roos Act and a special tax formula which determines the special tax due each year are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC's federal immunity. The Ninth Circuit has issued a ruling on August 28, 2001 in which it determined that the FDIC, as a federal agency, is exempt from Mello-Roos special taxes. The District is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Special Taxes on a parcel within Improvement Area No. 1 in which the FDIC has or obtains an interest, although prohibiting the lien of the Special Taxes to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Such an outcome could cause a draw on the Reserve Fund and perhaps, ultimately, if enough property were to become owned by the FDIC, a default in payment on the 2013 Bonds. No Acceleration Provision The 2013 Bonds and the Fiscal Agent Agreement do not contain a provision allowing for the acceleration of the 2013 Bonds in the event of a payment default or other default under the 63 P680 terms of the 2013 Bonds or the Fiscal Agent Agreement or in the event interest on the 2013 Bonds becomes included in gross income for federal income tax purposes. Taxability Risk As discussed in this Official Statement under the caption "TAX MATTERS," interest on the 2013 Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date the 2013 Bonds were issued, as a result of future acts or omissions of the District in violation of its covenants in the Fiscal Agent Agreement. There is no provision in the 2013 Bonds or the Fiscal Agent Agreement for special redemption or acceleration or for the payment of additional interest should such an event of taxability occur, and the 2013 Bonds will remain outstanding until maturity or until redeemed under one of the other redemption provisions contained in the Fiscal Agent Agreement. In addition, as discussed under the caption "TAX MATTERS," Congress has considered in the past, is currently considering and may consider in the future, legislative proposals, including some that carry retroactive effective dates, that, if enacted, would alter or eliminate the exclusion from gross income for federal income tax purposes of interest on municipal bonds, such as the 2013 Bonds. Prospective purchasers of the 2013 Bonds should consult their own tax advisors regarding any pending or proposed federal tax legislation. The District can provide no assurance that federal tax law will not change while the 2013 Bonds are outstanding or that any such changes will not adversely affect the exclusion of interest on the 2013 Bonds from gross income for federal income tax purposes. If the exclusion of interest on the 2013 Bonds from gross income for federal income tax purposes were amended or eliminated, it is likely that the market price for the 2013 Bonds would be adversely impacted. Enforceability of Remedies The remedies available to the Fiscal Agent and the registered owners of the 2013 Bonds upon a default under the Fiscal Agent Agreement or any other document described in this Official Statement are in many respects dependent upon regulatory and judicial actions that are often subject to discretion and delay. Under existing law and judicial decisions, the remedies provided for under such documents may not be readily available or may be limited. Any legal opinions to be delivered concurrently with the issuance of the 2013 Bonds will be qualified to the extent that the enforceability of the legal documents with respect to the 2013 Bonds is subject to limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally and by equitable remedies and proceedings generally. Judicial remedies, such as foreclosure and enforcement of covenants, are subject to exercise of judicial discretion. A California court may not strictly apply certain remedies or enforce certain covenants if it concludes that application or enforcement would be unreasonable under the circumstances and it may delay the application of such remedies and enforcement. No Secondary Market No representation is made concerning any secondary market for the 2013 Bonds. There can be no assurance that any secondary market will develop for the 2013 Bonds. Investors should understand the long-term and economic aspects of an investment in the 2013 Bonds and should assume that they will have to bear the economic risks of their investment to maturity. An investment in the 2013 Bonds may be unsuitable for any investor not able to hold the 2013 Bonds to maturity. 64 P681 Proposition 218 An initiative measure entitled the "Right to Vote on Taxes Act' (the 'Initiative") was approved by the voters of the State at the November 5, 1996 general election. The Initiative added Article XIIIC and Article XIIID to the California Constitution. According to the 'Title and Summary" of the Initiative prepared by the California Attorney General, the Initiative limits 'the authority of local governments to impose taxes and property-related assessments, fees and charges." Provisions of the Initiative have been and will continue to be interpreted by the courts. The Initiative could potentially impact the Special Taxes otherwise available to the District to pay the principal of and interest on the 2013 Bonds as described below. Among other things, Section 3 of Article XIIIC states, "...the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or charge." The Act provides for a procedure, which includes notice, hearing, protest and voting requirements to alter the rate and method of apportionment of an existing special tax. However, the Act prohibits a legislative body from adopting any resolution to reduce the rate of any special tax or terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Act unless such legislative body determines that the reduction or termination of the special tax would not interfere with the timely retirement of that debt. On July 1, 1997, the Governor of the State signed a bill into law enacting Government Code Section 5854, which states that: Section 3 of Article XIIIC of the California Constitution, as adopted at the November 5, 1996, general election, shall not be construed to mean that any owner or beneficial owner of a municipal security, purchased before or after that date, assumes the risk of, or in any way consents to, any action by initiative measure that constitutes an impairment of contractual rights protected by Section 10 of Article I of the United States Constitution. Accordingly, although the matter is not free from doubt, it is likely that Article XIIIC has not conferred on the voters the power to repeal or reduce the Special Taxes if such reduction would interfere with the timely retirement of the 2013 Bonds. It may be possible, however, for voters or the District or the City Council acting as the legislative body of the District to reduce the Special Taxes in a manner that does not interfere with the timely repayment of the 2013 Bonds, but which does reduce the maximum amount of Special Taxes that may be levied in any year below the existing levels. Furthermore, no assurance can be given with respect to the future levy of the Special Taxes in amounts greater than the amount necessary for the timely retirement of the 2013 Bonds. Therefore, no assurance can be given with respect to the levy of Special Taxes for Administrative Expenses (as defined in the Fiscal Agent Agreement). Nevertheless, the District has covenanted that no modification of the minimum or maximum authorized Special Tax will be approved by the District nor will it take any other action that would (i) prohibit the District from levying the Special Tax within Improvement Area No. 1 of the District in any Fiscal Year at such a rate as would generate Special Tax Revenues (other than, in each Fiscal Year, up to the first $_,000 of Special Tax Revenues that may be deposited into the Administrative Expense Fund) in such Fiscal Year at least equal to 110% of Annual Debt Service on all Bonds then Outstanding; (ii) discontinue or cause the discontinuance of such levy; or (iii) permit the prepayment of the Special Tax except as permitted pursuant to the Rate and Method. However, no assurance can be given as to the enforceability of the foregoing covenant. 65 P682 The interpretation and application of Article XIIIC and Article XIIID will ultimately be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such determination or the timeliness of any remedy afforded by the courts. See "—Enforceability of Remedies." Ballot Initiatives Articles XIIIC and XIIID of the California Constitution were adopted pursuant to measures qualified for the ballot pursuant to California's constitutional initiative process, and the State Legislature has in the past enacted legislation that has altered the spending limitations or established minimum funding provisions for particular activities. On March 6, 1995 in the case of Rossi v. Brown, the State Supreme Court held that an initiative can repeal a tax ordinance and prohibit the imposition of further such taxes and that the exemption from the referendum requirements does not apply to initiatives. From time to time, other initiative measures could be adopted by California voters or legislation enacted by the legislature. The adoption of any such initiative or legislation might place limitations on the ability of the State, the City, or local districts to increase revenues or to increase appropriations. TAX MATTERS In the opinion of Best Best & Krieger LLP, San Diego, California, Bond Counsel, subject, however, to the qualifications set forth below, under existing law, the interest on the 2013 Bonds is excluded from gross income for federal income tax purposes, and such interest is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, provided, however, that, for the purpose of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining certain income and earnings. The opinions set forth in the preceding paragraph are subject to the condition that the Authority and the CFDs comply with all requirements of the Internal Revenue Code of 1986 (the "Code") that must be satisfied subsequent to the issuance of the 2013 Bonds in order that such interest be, or continue to be, excluded from gross income for federal income tax purposes. The Authority and the CFDs have covenanted to comply with each such requirement. Failure to comply with certain of such requirements may cause the inclusion of such interest in gross income for federal income tax purposes to be retroactive to the date of issuance of the 2013 Bonds. Bond Counsel expresses no opinion regarding other federal tax consequences arising with respect to the 2013 Bonds. In the further opinion of Bond Counsel, interest on the 2013 Bonds is exempt from California personal income taxes. To the extent the issue price of any maturity of the 2013 Bonds is less than the amount to be paid at maturity of such 2013 Bonds (excluding amounts stated to be interest and payable at least annually over the term of such 2013 Bonds), the difference constitutes "original issue discount," the accrual of which, to the extent properly allocable to each Owner thereof, is treated as interest on the 2013 Bonds which is excluded from gross income for federal income tax purposes and State of California personal income taxes. For this purpose, the issue price of a particular maturity of the 2013 Bonds is the first price at which a substantial amount of such maturity of the 2013 Bonds is sold to the public (excluding bond houses, brokers, or similar 66 P683 persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the 2013 Bonds accrues daily over the term to maturity of such 2013 Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such 2013 Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on maturity) of such 2013 Bonds. Owners of the 2013 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2013 Bonds with original issue discount, including the treatment of purchasers who do not purchase such 2013 Bonds in the original offering to the public at the first price at which a substantial amount of such 2013 Bonds is sold to the public. 2013 Bonds purchased, whether at original issuance or otherwise, for an amount greater than their principal amount payable at maturity (or, in some cases, at their earlier call date) ("Premium 2013 Bonds") will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium 2013 Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, a purchaser's basis in a Premium 2013 Bond, and under Treasury Regulations, the amount of tax exempt interest received will be reduced by the amount of amortizable bond premium properly allocable to such purchaser. Owners of Premium 2013 Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances. Owners of the 2013 Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the 2013 Bonds may have federal or state tax consequences other than as described above. 2013 Bond Counsel expresses no opinion regarding any federal or state tax consequences arising with respect to the 2013 Bonds other than as expressly described above. The complete text of the final opinion that Bond Counsel expects to deliver upon issuance of the 2013 Bonds is set forth in Appendix D. LEGAL MATTERS Concurrently with the issuance of the 2013 Bonds, Best Best & Krieger LLP, San Diego, California, Bond Counsel, will render its opinion substantially in the form set forth in Appendix D to this Official Statement. Certain legal matters with respect to the 2013 Bonds will be passed upon for the District by the City Attorney, and for the District by Jones Hall, A Professional Law Corporation, San Francisco, California, acting as Disclosure Counsel. Certain legal matters will be passed upon for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. Payment of the fees and expenses of Bond Counsel, Disclosure Counsel and Underwriter's Counsel is contingent on the issuance of the 2013 Bonds. NO RATING The District did not apply for or receive a rating for the 2013 Bonds. 67 P684 LITIGATION The District is not aware of any pending or threatened litigation challenging the validity of the 2013 Bonds, the Special Taxes securing the 2013 Bonds, or any action taken by the District in connection with the formation of the District or Improvement Area No. 1, the levying of the Special Taxes or the issuance of the 2013 Bonds. UNDERWRITING The 2013 Bonds are being purchased through negotiation by Stifel, Nicolaus & Company, Incorporated (the "Underwriter"). The Underwriter agreed to purchase the 2013 Bonds at a price of $ (which is equal to the par amount of the 2013 Bonds, less a net original issue discount of $ , and less an underwriter's discount of $ ). The initial public offering prices set forth on the inside cover page may be changed by the Underwriter. The Underwriter may offer and sell the 2013 Bonds to certain dealers and others at prices lower than the public offering prices set forth on the inside cover page hereof. CONTINUING DISCLOSURE Continuing Disclosure Certificate of City. The City, for and on behalf of itself and the District, will covenant in a continuing disclosure certificate (the "City Continuing Disclosure Certificate"), for the benefit of the Owners of the 2013 Bonds, to provide certain annual financial information and operating data, and to provide notices of the occurrence of certain enumerated events. The City will agree in its certificate to file, or cause to be filed, with the MSRB such report and notices. The covenants of the City have been made in order to assist the Underwriter in complying with the Rule. The City Continuing Disclosure Certificate is attached as Appendix E of this Official Statement. [confirm] The City has not failed to comply in any material respects with any undertaking under the Rule in the past five years. Continuing Disclosure Certificate of Tenants-in-Common. The Tenants-in-Common will covenant in a continuing disclosure certificate (the 'TIC Continuing Disclosure Certificate"), for the benefit of holders and beneficial owners of the 2013 Bonds, to provide (i) on a semi-annual basis, certain information relating to themselves and the parcels they own within Improvement Area No. 1 and (ii) notices of the occurrence of certain enumerated events. Wells Fargo Bank, National Association, will initially act as the dissemination agent under the TIC Continuing Disclosure Certificate. The obligations of the Tenants-in-Common under the TIC Continuing Disclosure Certificate will terminate on the earlier of (i) legal defeasance, prior redemption or payment in full of all the 2013 Bonds; (ii) the time that the property they or any of their affiliates own within Improvement Area No. 1 is no longer responsible for payment of 20% or more of the Special Taxes in any Zone; or (iii) the date on which the Tenants-in-Common prepay in full all the Special Taxes attributable to the property that they own within Improvement Area No. 1. The TIC Continuing Disclosure Certificate is attached as Appendix F of this Official Statement. A default under the TIC Continuing Disclosure Certificate will not, by itself, constitute an Event of Default under the Fiscal Agent Agreement, and the sole remedy under the TIC 68 P685 Continuing Disclosure Certificate in the event of any failure of the Tenants-in-Common to comply will be an action to compel specific performance. Neither the City nor the District has any obligation to enforce the continuing disclosure undertaking of the Tenants-in-Common. On the closing of Forest City's recapitalization transaction with QIC, as described under the heading entitled "IMPROVEMENT AREA NO. 1 — Land Owners —Zone 2 Land Ownership — Announced Recapitalization with QIC," Rancho Mall, LLC will automatically assume the obligations of the Tenants-in-Common under the TIC Continuing Disclosure Certificate. [confirm] The Tenants-in-Common have not failed to comply in all material respects with any undertaking under the Rule in the past five years. 69 P686 MISCELLANEOUS Included in this Official Statement are brief summaries of certain documents and reports, which summaries do not purport to be complete or definitive, and reference is made to such documents and reports for full and complete statements of their contents. Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the District or the City and the purchasers or Owners of any of the 2013 Bonds. The execution and delivery of this Official Statement has been duly,authorized by the City Council, as the legislative body of the District. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Authorized Representative 70 P687 APPENDIX A CITY OF RANCHO CUCAMONGA GENERAL DEMOGRAPHIC INFORMATION General The City of Rancho Cucamonga (the "City") is located in the foothills of the Los Angeles- San Bernardino Basin in the western portion of San Bernardino County, approximately 40 miles east of the City of Los Angeles and 18 miles west of the City of San Bernardino. The City Covers approximately 39.9 square miles and is bordered by Ontario on the south, Upland on the west and Fontana to the east, to the north are Cucamonga Peak and Mount Baldy. Municipal Government The City was incorporated on November 30, 1977, as a general law city operating under the council-manager form of government. It is governed by a five-member City Council (the "Council'), which includes a Mayor who is elected at large for a four-year term, and four Council Members are elected at large for staggered four-year terms. The Council appoints the City Manager and City Attorney. The City Manager is responsible for the daily administration of City affairs and for implementing Council policy and program decisions. Population Prior to incorporation, the area generally within the corporate boundaries of the City experienced a rapid growth in population. Population figures for the City, the County and the State for the last five years are shown in the following table. CITY OF RANCHO CUCAMONGA AND COUNTY OF SAN BERNARDINO Population Estimates City of County of State of Year Rancho Cucamonga San Bernardino California 2008 164,671 2,009,594 36,704,375 2009 164,764 2,019,432 36,966,713 2010 165,391 2,033,141 37,223,900 2011 167,701 2,046,619 37,427,946 2012 169,498 2,063,919 37,678,563 Source: State Department of Finance estimates(as of January 1) Employment The City is included in the Riverside—San Bernardino—Ontario Metropolitan Statistical Area ("MSA"). The unemployment rate in the Riverside-San Bernardino-Ontario MSA was 11.3% in November 2012, down from a revised 11.7% in October 2012, and below the year-ago estimate of 12.4%. This compares with an unadjusted unemployment rate of 9.6% for California and 7.4% for the nation during the same period. The unemployment rate was 11.5% in Riverside County, and 11.0% in San Bernardino County. A-1 P688 The following table summarizes the civilian labor force, employment and unemployment in the County for the calendar years 2007 through 2011. These figures are county-wide statistics and may not necessarily accurately reflect employment trends in the City. RIVERSIDE-SAN BERNARDINO-ONTARIO METROPOLITAN STATISTICAL AREA Civilian Labor Force, Employment and Unemployment (Annual Averages) 2007 2008 2009 2010 2011 Civilian Labor Force c't 1,766,900 1,776,000 1,774,800 1,798,200 1,799,000 Employment 1,664,000 1,629,500 1,541,300 1,540,500 1,557,800 Unemployment 102,900 146,500 233,500 257,700 241,200 Unemployment Rate 5.8% 8.3% 13.2% 14.3% 13.4% Wage and Salary Employment: (2) Agriculture 16,400 15,900 14,900 15,000 14,900 Mining and Logging 1,300 1,200 1,100 1,000 1,000 Construction 112,500 90,700 67,900 59,700 58,700 Manufacturing 118,500 106,900 88,800 85,100 85,800 Wholesale Trade 56,800 54,100 48,900 48,600 49,400 Retail Trade 175,600 168,600 156,200 155,500 157,200 Transportation, Warehousing, 69,500 70,200 66,800 66,600 68,500 Utilities Information 15,400 14,900 15,100 15,800 15,000 Finance and Insurance 30,300 27,400 26,000 25,500 25,000 Real Estate and Rental and Leasing 19,500 18,700 16,600 15,500 14,200 Professional and Business Services 145,200 137,700 124,300 123,400 126,100 Educational and Health Services 127,200 131,800 133,600 133,800 137,900 Leisure and Hospitality 132,600 131,000 123,800 122,800 124,300 Other Services 41,200 40,800 37,300 38,200 39,300 Federal Government 19,400 19,600 20,600 22,700 21,200 State Government 28,700 29,600 29,800 29,300 29,100 Local Government 177,200 180,700 178,100 182,300 177,000 Total,All Industries tat 1,287,300 1,239,700 1,149,700 1,140,900 1,144,600 (1) Labor force data is by place of residence; includes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike. (2) Industry employment is by place of work; excludes self-employed individuals, unpaid family workers, household domestic workers, and workers on strike. (3) Totals may not add due to rounding. Source: State of California Employment Development Department. Between August 2010 and August 2011, total nonfarm employment decreased by 6,100 jobs. Agricultural employment declined by 200 jobs. Government posted the greatest year-over decline with a loss of 12,600 jobs. The job losses in this industry included local government (down 11,700 jobs) and federal government (down 900 jobs). State government reported no change. Three other industry sectors also registered employment loss over the year. Leisure and hospitality (down 2,600 jobs), construction (down 1,400 jobs), and other services (down 700 jobs). A-2 P689 • Trade, transportation, and utilities reported the greatest year-over gain, adding 5,800 jobs. Transportation, warehousing, and utilities (up 2,700 jobs) accounted for more than 46 percent of the year-over growth. Wholesale trade increased by 1,800 jobs and retail trade gained 1,300 jobs. • The remaining industries all recorded year-over job gains, most significantly in educational and health services (up 2,700 jobs) and professional and business services (up 1,700 jobs). Major Employers The following table shows the major manufacturing and non-manufacturing employers within the City and their estimated number of employees as of June 30, 2011: CITY OF RANCHO CUCAMONGA Major Employers As of June 30, 2011 Company Type of Business No. of Employees Chaffey Community College Community College 1,763 Etiwanda School District School District 1,198 City of Rancho Cucamonga City Government 954 Alta Loma School District School District 942 Amphastar Pharmaceuticals Pharmaceutical Manufacturer 880 Southern California Edison Utilities 800 Mercury Insurance Company Insurance 606 West Coast Liquidators Variety Store 565 Frito-Lay, Inc. Snack Foods Manufacturer 561 CMC Steel Fabricators Steel Manufacturer 517 Source: City of Rancho Cucamonga, Finance Department, Comprehensive Annual Financial Report (CAFR), year ended June 30, 2011. A-3 P690 Commercial Activity In 2009, the State Board of Equalization converted the business codes of sales and use tax permit holders to North American Industry Classification System codes. As a result of the coding change, retail stores data for 2009 and after is not comparable to that of prior years. A summary of historic taxable sales within the City during the past five years in which data is available is shown in the following table. Total taxable sales during the first three quarters of calendar year 2011 in the City were reported to be $1,551,241,000, an 8.56 percent increase over the total taxable sales of$1,428,940,000 reported during the first three quarters of calendar year 2010. Annual figures for calendar year 2011 are not yet available. CITY OF RANCHO CUCAMONGA Taxable Transactions (figures in thousands) Retail Stores Total All Outlets Number Number of Permits Taxable of Permits Taxable on August 1 Transactions on August 1 Transactions 2006 1,785 1,831,336 3,533 2,386,137 2007 1,820 1,779,950 3,658 2,335,377 2008 1,865 1,632,054 3,741 2,220,503 200911 2,197 1,468,867 3,537 1,921,110 201011 2,407 1,504,740 3,780 1,962,697 (1) Not comparable to prior years."Retail"category now includes"Food Services." Source: California State Board of Equalization,Taxable Sales in California(Sales 8 Use Tax). A summary of historic taxable sales within the County during the past five years in which data is available is shown in the following table. Total taxable sales during the first three quarters of calendar year 2011 in the County were reported to be $20,062,471,000, a 10.64 percent increase over the total taxable sales of $18,132,941,000 reported during the first two quarters of calendar year 2010. Annual figures for calendar year 2011 are not yet available. COUNTY OF SAN BERNARDINO Taxable Transactions Number of Permits and Valuation of Taxable Transactions (Dollars in Thousands) Retail Stores Total All Outlets Number Number of Permits Taxable of Permits Taxable on August 1 Transactions on August 1 Transactions 2006 24,755 22,130,160 46,528 31,309,905 2007 24,407 21,335,824 47,810 30,450,731 2008 25,076 19,065,786 48,994 27,777,703 200911 31,676 16,330,138 45,062 23,652,433 201011 34,068 17,308,880 47,562 24,687,862 (1) Not comparable to prior years. "Retail"category now includes"Food Services." Source: California State Board of Equalization,Taxable Sales in California (Sales 8 Use Tax). A-4 P691 Construction Activity Provided below are the building permits and valuations for the City and the County for calendar years 2007 through 2011. CITY OF RANCHO CUCAMONGA Total Building Permit Valuations (Valuations in Thousands) 2007 2008 2009 2010 2011 Permit Valuation New Single-family $135,917.9 $38,685.1 $51,367.3 $36,885.0 $49,375.1 New Multi-family 19,031.1 29,407.3 43,595.7 0.0 25,990.9 Res.Alterations/Additions 8,366.8 5,432.4 3,416.5 3,818.2 7,533.5 Total Residential 163,315.9 73,524.9 98,379.5 40,703.2 82,899.5 New Commercial 52,894.3 17,662.8 1,638.4 529.6 233.1 New Industrial 4,225.9 2,378.4 0.0 0.0 0.0 New Other 16,235.6 8,266.7 7,837.0 8,129.2 105.0 Com. Alterations/Additions 41,330.1 21,384.7 12,043.7 9,469.5 15,531:1 Total Nonresidential $114,685.8 $49,692.5 $21,519.1 $18,128.4 $15,869.2 New Dwelling Units Single Family 617 159 280 144 177 Multiple Family 179 302 468 0 192 TOTAL 796 461 748 144 369 Source: Construction Industry Research Board, Building Permit Summary. COUNTY OF SAN BERNARDINO Total Building Permit Valuations (Valuations in Thousands) 2007 2008 2009 2010 2011 Permit Valuation New Single-family $1,263,350.5 $383,615.0 $279,993.7 $233,404.1 $232,698.4 New Multi-family 155,820.1 102,257.4 96,741.5 61,080.8 49,011.4 Res.Alterations/Additions 128,336.1 86.585.0 62,858.9 62,731.0 99,082.5 Total Residential 1,547,506.7 572,457.3 439,594.1 357,215.9 380,792.3 New Commercial 569,354.4 310,847.8 70,373.4 39,380.8 67,146.5 New Industrial 350,521.0 92,200.4 34,028.5 21,853.6 50,629.8 New Other 190,362.6 100,797.4 72,127.6 62,614.4 6,404.5 Com.Alterations/Additions 255.984.2 234.970.0 156 292.0 129.150.1 197,960.7 Total Nonresidential $1,366,222.3 $738,815.6 $332,821.5 $252,998.9 $322,141.5 New Dwelling Units Single Family 6,239 1,981 1,441 1,198 1,075 Multiple Family 1 765 1 201 1 054 649 409 TOTAL 8,004 3,182 2,495 1,847 1,484 Source: Construction Industry Research Board, Building Permit Summary. A-5 P692 Effective Buying Income "Effective Buying Income" is defined as personal income less personal tax and nontax payments, a number often referred to as "disposable" or "after-tax" income. Personal income is the aggregate of wages and salaries, other labor-related income (such as employer contributions to private pension funds), proprietor's income, rental income (which includes imputed rental income of owner-occupants of non-farm dwellings), dividends paid by corporations, interest income from all sources, and transfer payments (such as pensions and welfare assistance). Deducted from this total are personal taxes (federal, state and local), nontax payments (fines, fees, penalties, etc.) and personal contributions to social insurance. According to U.S. government definitions, the resultant figure is commonly known as "disposable personal income." The following table summarizes the total effective buying income for the City, the County, the State and the United States for the period 2007 through 2011. CITY OF RANCHO CUCAMONGA; COUNTY OF SAN BERNARDINO Effective Buying Income As of January 1, 2007 through 2011 Median Total Effective Household Buying Income Effective Year Area (000's Omitted) Buying Income 2007 City of Rancho Cucamonga $3,971,740 $60,930 County of San Bernardino 33,455,520 44,276 California 814,894,438 48,203 United States 6,300,794,040 41,792 2008 City of Rancho Cucamonga $4,076,143 $63,140 County of San Bernardino 34,745,023 45,814 California 832,531,445 48,952 United States 6,443,994,426 42,303 2009 City of Rancho Cucamonga $4,076,843 $63,829 County of San Bernardino 34,899,738 45,690 California 844,823,319 49,736 United States 6,571,536,768 43,252 2010 City of Rancho Cucamonga $3,713,548 $59,587 County of San Bernardino 32,115,644 43,018 California 801,393,028 47,177 United States 6,365,020,076 41,368 2011 City of Rancho Cucamonga $3,827,855 $59,308 County of San Bernardino 32,969,928 42,818 California 814,578,458 47,062 United States 6,438,704,664 41,253 Source: The Nielsen Company(US), Inc. A-6 P693 APPENDIX B RATE AND METHOD B-1 P694 APPENDIX C SUMMARY OF THE FISCAL AGENT AGREEMENT C-1 P695 APPENDIX D FORM OF OPINION OF BOND COUNSEL D-1 P696 APPENDIX E FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE S CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 1 SPECIAL TAX REFUNDING BONDS, SERIES 2013 This CONTINUING DISCLOSURE CERTIFICATE (this "Disclosure Certificate") is executed and delivered by the City of Rancho Cucamonga, California (the "Ci r"), on behalf of itself and the City of Rancho Cucamonga Community Facilities District No. 2003-01, Improvement Area No. 1(the "District"), in connection with the execution and delivery of the bonds captioned above (the "2013 Bonds"). The 2013 Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent Agreement"), by and between the District and Wells Fargo Bank, National Association, as fiscal agent. The City covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City, on behalf of itself and the District, for the benefit of the holders and beneficial owners of the 2013 Bonds and in order to assist the Participating Underwriter in complying with Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934, as amended. Section 2. Definitions. In addition to the definitions of capitalized terms set forth above and in Section 1.03 of the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section 2, the following capitalized terms shall have the meanings ascribed to them below when used in this Disclosure Certificate: "Annual Report" means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Annual Report Date" means the date that is seven months days after the end of the City's fiscal year (currently February 1 based on the City's fiscal year end of June 30). "Business Day' means any day on which the City is not required or authorized to be closed. "Dissemination Agent' means Wells Fargo Bank, National Association,or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation. "Listed Events" means any of the events listed in Section 5(a) of this Disclosure Certificate. E-1 P697 "MSRB" means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. "Official Statement" means the final official statement, dated , 2013, executed by the City in connection with the issuance of the 2013 Bonds. "Participating Underwriter" means Stifel, Nicolaus & Company, Incorporated, the original underwriter of the 2013 Bonds required to comply with the Rule in connection with offering of the 2013 Bonds. "Rule" means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. Section 3. Provision of Annual Reports. (a) The City shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, commencing February 1, 2014, with the report for the 2012-13 fiscal year, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 Business Days prior to the Annual Report Date, the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If by 15 Business Days prior to the Annual Report Date the Dissemination Agent (if other than the City) has not received a copy of the Annual Report, the Dissemination Agent shall contact the City to determine if the City is in compliance with the previous sentence. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Annual Report Date, if not available by that date. If the City's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(b). The City shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by the City hereunder. (b) If the City does not provide (or cause the Dissemination Agent to provide) an Annual Report by the Annual Report Date, the City shall provide (or cause the Dissemination Agent to provide) to the MSRB, in an electronic format as prescribed by the MSRB, a notice in substantially the form attached as Exhibit A. (c)With respect to each Annual Report, the Dissemination Agent shall: (i) determine each year prior to the Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and (ii) if the Dissemination Agent is other than the City, file a report with the City certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided. E-2 P698 Section 4. Content of Annual Reports. The City's Annual Report shall contain or incorporate by reference the following: (a) The City's audited financial statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, together with the following statement: THE CITY'S ANNUAL FINANCIAL STATEMENT IS PROVIDED SOLELY TO COMPLY WITH THE SECURITIES EXCHANGE COMMISSION STAFF'S INTERPRETATION OF RULE 15C2-12 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. NO FUNDS OR ASSETS OF THE CITY ARE REQUIRED TO BE USED TO PAY DEBT SERVICE ON THE 2013 BONDS, AND NEITHER THE CITY NOR THE DISTRICT IS OBLIGATED TO ADVANCE AVAILABLE FUNDS TO COVER ANY DELINQUENCIES. INVESTORS SHOULD NOT RELY ON THE FINANCIAL CONDITION OF THE CITY IN EVALUATING WHETHER TO BUY, HOLD OR SELL THE 2013 BONDS. If the City's audited financial statements are not available by the Annual Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) Unless otherwise provided in the audited financial statements filed on or before the Annual Report Date, the following financial information and operating data with respect to the Community Facilities District, substantially similar to that provided in the Official Statement: Unless otherwise provided in the audited financial statements filed on or prior to the annual filing deadline for the Annual Reports provided for in Section 3 above, financial information and operating data with respect to the District for the preceding fiscal year, substantially similar to that provided in the corresponding tables and charts in the Official Statement for the 2013 Bonds, as follows: (i) For each Zone, the assessed value (per the San Bernardino County Assessor's records) of all parcels currently subject to the Special Tax within the Zone, showing the total assessed valuation for all parcels of Taxable Property (as defined in the RMA) as of the end of the most recently completed Fiscal Year, and the percent change from the prior Fiscal Year, substantially in the form of Table 3 of the Official Statement. (ii) For each Zone, with respect to delinquent Special Taxes in the Zone, delinquency information as of the end of the most recently completed Fiscal Year and the August 1 next preceding the related Annual Report Date, substantially in the form of Tables 6a, 6b and 6c of the Official Statement. (iii) The amount of prepayments of the Special Tax with respect to the District for the most recently completed Fiscal Year. (iv) For each Zone, a land ownership summary listing property owners responsible for more than 5% of the annual Special Tax levy in the Zone, as shown on the San Bernardino County Assessor's last equalized tax roll prior to the September next preceding the Annual Report Date, and a calculation of each such owner's value-to- burden ratio based upon assessed value and the burden of that property's share of the Special Tax Refunding Bonds only. E-3 P699 (v) The principal amount of the Bonds outstanding as of the September 30 next preceding the Annual Report Date. (vi) For each Zone, an updated calculation of the value-to-burden ratio on a Zone-specific basis in substantially the form of Tables 4a, 4b and 4c of the Official Statement, based upon (A) the Taxable Property's assessed value as shown on the San Bernardino County Assessor's last equalized tax roll prior to the September next preceding the Annual Report Date and (B) the burden of that property's share of the Bonds and overlapping debt. (vii) Any changes to the Rate and Method of Apportionment of Special Tax for the District. (viii) Annual information required to be filed by the City with the California Debt and Investment Advisory Commission pursuant to the Act and relating generally to outstanding bond amounts, fund balances, assessed values, special tax delinquencies and foreclosure information. (ix) If any, information relating to the number of new construction building permits and certificates of occupancy issued in the District during the preceding fiscal year. (c) In addition to any of the information expressly required to be provided under this Disclosure Certificate, the City shall provide such further material information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. (d) Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB's Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference. Section 5. Reporting of Significant Events. (a) The City shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to the 2013 Bonds: (1) Principal and interest payment delinquencies. (2) Non-payment related defaults, if material. (3) Unscheduled draws on debt service reserves reflecting financial difficulties. (4) Unscheduled draws on credit enhancements reflecting financial difficulties. (5) Substitution of credit or liquidity providers, or their failure to perform. E-4 P700 (6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax-exempt status of the security. (7) Modifications to rights of security holders, if material. (8) Bond calls, if material, and tender offers. (9) Defeasances. (10) Release, substitution, or sale of property securing repayment of the securities, if material. (11) Rating changes. (12) Bankruptcy, insolvency, receivership or similar event of the City. (13) The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material. (14) Appointment of a successor or additional fiscal agent or the change of name of a fiscal agent, if material. (b) Whenever the City obtains knowledge of the occurrence of a Listed Event, the City shall, or shall cause the Dissemination Agent (if not the City) to, file a notice of such occurrence with the MSRB, in an electronic format as prescribed by the MSRB, in a timely manner not in excess of 10 business days after the occurrence of the Listed Event. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(8) and (9) above need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected 2013 Bonds under the Indenture. (c) The City acknowledges that the events described in subparagraphs (a)(2), (a)(7), (a)(8) (if the event is a bond call), (a)(10), (a)(13), and (a)(14) of this Section 5 contain the qualifier "if material." The City shall cause a notice to be filed as set forth in paragraph (b) above with respect to any such event only to the extent that the City determines the event's occurrence is material for purposes of U.S. federal securities law. (d) For purposes of this Disclosure Certificate, any event described in paragraph (a)(12) above is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and orders of a court or governmental E-5 P701 authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City. Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB under the Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB. Section 7. Termination of Reporting Obligation. The City's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the 2013 Bonds. If such termination occurs prior to the final maturity of the 2013 Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(b). Section 8. Dissemination Agent. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be Wells Fargo Bank, National Association. Any Dissemination Agent may resign by providing 30 days' written notice to the City. Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied: (a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the 2013 Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the 2013 Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver either (i) is approved by holders of the 2013 Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the 2013 Bonds. If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first Annual Report filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. If an amendment is made to this Disclosure Certificate modifying the accounting principles to be followed in preparing financial statements, the Annual Report for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the E-6 P702 basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to evaluate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of any amendment made pursuant to this Section 9 shall be filed in the same manner as for a Listed Event under Section 5(b). Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. Section 11. Default. If the City fails to comply with any provision of this Disclosure Certificate, the Participating Underwriter or any holder or beneficial owner of the 2013 Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance. Section 12. Duties Immunities and Liabilities of Dissemination Agent. (a) The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnify and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The Dissemination Agent shall have no duty or obligation to review any information provided to it by the City hereunder, and shall not be deemed to be acting in any fiduciary capacity for the City, the Bond holders or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the 2013 Bonds. (b) The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as amended from time to time, and shall be reimbursed for all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the 2013 Bonds, and shall create no rights in any other person or entity. E-7 P703 Date: , 2013 CITY OF RANCHO CUCAMONGA, CALIFORNIA, for and on behalf of CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Name: Title: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Dissemination Agent By: Name: Title: E-8 P704 EXHIBIT A NOTICE OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: City of Rancho Cucamonga Community Facilities District No. 2003-01 Name of Issue: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 1Special Tax Refunding Bonds, Series 2013 Date of Issuance: _' 2013 NOTICE IS HEREBY GIVEN that the City has not provided an Annual Report with respect to the above-named 2013 Bonds as required by Section 5.15 of the Fiscal Agent Agreement, dated as of July 1, 2013, by and between the District and Wells Fargo Bank, National Association, as fiscal agent. The City anticipates that the Annual Report will be filed by Dated: CITY OF RANCHO CUCAMONGA, CALIFORNIA, for and on behalf of CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Its: E-9 P705 APPENDIX F FORM OF TIC CONTINUING DISCLOSURE CERTIFICATE F-1 P706 APPENDIX G DTC AND THE BOOK-ENTRY ONLY SYSTEM The information in this Appendix F has been provided by The Depository Trust Company ("DTC"), New York, NY, for use in securities offering documents, and the District does not take responsibility for the accuracy or completeness thereof. The District cannot and does not give any assurances that DTC, DTC Participants or Indirect Participants will distribute the Beneficial Owners either (a) payments of interest, principal or premium, if any, with respect to the 2013 Bonds or (b) certificates representing ownership interest in or other confirmation of ownership interest in the 2013 Bonds, or that they will so do on a timely basis or that DTC, DTC Direct Participants or DTC Indirect Participants mill act in the manner described in this Official Statement. The following description of DTC, the procedures and record keeping with respect to beneficial ownership interests in the 2013 Bonds, payment of principal, interest and other payments on the 2013 Bonds to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the 2013 Bonds and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be. Neither the issuer of the 2013 Bonds (the "Issuer") nor the trustee, fiscal agent or paying agent appointed with respect to the 2013 Bonds (the Agent') take any responsibility for the information contained in this Appendix. No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the 2013 Bonds, (b) certificates representing ownership interest in or other confirmation or ownership interest in the 2013 Bonds, or(c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the 2013 Bonds, or that they will so do on a timely basis, or that DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Appendix. The current "Rules" applicable to DTC are on file with the Securities and Exchange Commission and the current "Procedures" of DTC to be followed in dealing with DTC Participants are on file with DTC. 1. The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the 2013 Bonds (the "Securities"). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue. G-1 P707 2. DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency' registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants'). On August 8, 2011, Standard & Poor's downgraded its rating of DTC from AAA to AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org. The information contained on this Internet site is not incorporated herein by reference. 3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC's records. The ownership interest of each actual purchaser of each Security ("Beneficial Owner') is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued. 4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. 5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or G-2 P7O8 regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. 6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. 7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). 8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 9. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. 10. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. 11. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof. G-3 P709 APPENDIX H VICTORIA GARDENS MALL TENANT ROSTER As of_, 2013 Tenant Square Unit Name Feet H-1 P710 STAFF REPORT ADMINISTRATIVE SERVICES DEPARTMENT RANCHO Date: July 3, 2013 C,UCAMONGA To: Mayor and Members of City Council John R. Gillison, City Manager From: Lori E. Sassoon, Deputy City Manager/Administrative Services)�j By: Ingrid Y. Bruce, GIS/Special Districts Manager YY'� Subject: APPROVAL OF A RESOLUTION AUTHORIZING THE ISSUANCE OF BONDS FOR COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS,SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED$3,100,000(THREE MILLION,ONE HUNDRED THOUSAND DOLLARS)AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS. RECOMMENDATION It is recommended that the City Council approve a resolution authorizing the issuance of Bonds for Community Facilities District No. 2003-01 designated Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013 in an aggregate principal amount not to exceed $3,100,000 (three million, one hundred thousand dollars) (the "Special Tax Refunding Bonds') and the defeasance and refunding of prior special tax bonds, approving the form of a Fiscal Agent Agreement, Escrow Deposit and Trust Agreement, Bond Purchase Agreement Preliminary Official Statement, Continuing Disclosure Certificate, and other documents and authorizing certain actions in connection with the issuance of such revenue bonds. BACKGROUND The City Council, acting for and on behalf of itself and in its capacity as the legislative body of the Community Facilities District 2003-01, is being asked to consider authorizing the issuance of special tax refunding bonds (the "Refunding Bonds') for the purpose of refunding the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-B (the "Prior Special Tax Bonds") issued for such community facilities district. The anticipated savings projected to result from the refunding will be generated from the existence of favorable interest rate conditions in the municipal bond market and the maturity of the district; i.e., completion of substantial development and the diversity of ownership within Improvement Area No. 2 creates a better overall credit for the district: Based upon pro formas run to date the refunding has the potential of saving the property owners approximately 5% to 7% annually over the remaining life of the bond issues. The actual level of savings will depend upon conditions in the municipal bond market at the time the Special Tax Refunding Bonds are priced. P711 PAGH2 APPROVAL OF A RESOLUTION AUTHORIZJNG THE ISSUANCE OF BONDS FOR COMMUNITY FACILITIES DISTRICT NO.2003-01 DESIGNATED IMPROVEMENT AREA NO.2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $3,100,000(THREE MILLION,ONE HUNDRED THOUSAND DOLLARS)AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS. JULY 3,2013 For the reasons stated above, staff is recommending approval of the attached resolution and sale of the special tax refunding bonds. By approving the attached resolution the City Council will be: • Approving the issuance of the Special Tax Refunding Bonds; • Approving the form of the following agreements: • Fiscal Agent Agreement to establish the terms and conditions pursuant to which the Special Tax Refunding Bonds will be issued and administered; • Bond Purchase Agreement with Stifel, Nicholaus & Company, Incorporated ("Underwriter') to establish the terms and conditions pursuant to which the Special Tax Refunding Bonds will be sold to the Underwriter; and • Escrow Deposit and Trust Agreement to establish the terms and conditions pursuant to which the Prior Special Tax Bonds will be defeased and refunded. • Approving the form of: • the Preliminary Official Statement that will provide disclosure to prospective purchasers of the Special Tax Refunding Bonds and the Community Facilities District 2003-01 and Improvement Area No. 2 thereto; and • the Continuing Disclosure Certificate that constitutes the agreement by the City to provide continuing disclosure to the owners of the Special Tax Refunding Bonds and the municipal bond market in order to comply with the requirements of federal securities law and regulations. • Authorizing the City Manager, Deputy City Manager and the Finance Director to execute the various agreements and other documents subject to the pricing of the Special Tax Refunding Bonds meeting the financial parameters included in the resolution. Attachments: Resolution Agreements Preliminary Official Statement P712 RESOLUTION NO. 13-111 RESOLUTION OF THE CITY COUNCIL OF CITY OF RANCHO CUCAMONGA AUTHORIZING THE ISSUANCE OF BONDS OF COMMUNITY FACILITIES DISTRICT NO. 2003-01 DESIGNATED IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $3,100,000, AND THE DEFEASANCE AND REFUNDING OF PRIOR SPECIAL TAX BONDS OF SUCH DISTRICT ISSUED FOR IMPROVEMENT AREA NO. 2 THEREOF, APPROVING THE FORM OF A FISCAL AGENT AGREEMENT AND AUTHORIZING NEGOTIATION OF TERMS OF THE SALE OF SAID BONDS, APPROVING A PRELIMINARY OFFICIAL STATEMENT, AUTHORIZING PREPARATION OF A FINAL OFFICIAL STATEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS WHEREAS, the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District') was established and Improvement Area No. 1 and Improvement Area No. 2 (each, an `Improvement Area") were designated therein on February 19, 2003 pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the California Government Code) (the "Act'), by adoption by the City Council (the "City Council") of City of Rancho Cucamonga (the "City") of Resolution No. 03-031; and WHEREAS, under the provisions of the Act, on February 19, 2003, the City Council also adopted Resolution No. 03-032 which resolution, among other matters, expressed the determination of the City Council of the necessity to issue special tax bonds in the maximum aggregate principal amount of $4,000,000 for Improvement Area No. 2 of the District; WHEREAS, on February 19, 2003, consolidated special elections were held within Improvement Area No. 2 and there was submitted to the qualified voters of Improvement Area No. 2, among other propositions, the proposition of whether a bonded indebtedness in an aggregate principal amount not to exceed $4,000,000 should be incurred by and for the District for Improvement Area No. 2 for the purpose of providing public facilities for the benefit of the Improvement Area No. 2, and more than two-thirds of the votes cast in such consolidated special elections were cast in favor of incurring such bonded indebtedness, and the District is therefore authorized to issue bonds for Improvement Area No. 2 in an aggregate principal amount not to exceed $4,000,000 for the purposes set forth in said proposition; and WHEREAS, on May 21, 2003, the City Council adopted Resolution No. 03-125 authorizing the issuance and sale of bonds of the District for Improvement Area No. 2 pursuant to the Fiscal Agent Agreement, dated as of July 1 , 2003 (the 'Prior Fiscal Agent Agreement'), by and between the City, for and on behalf of the District, 60297.00031A8029530.2 P713 and Wells Fargo Bank, National Association, as fiscal agent, designated the "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-A" (the 'Prior Special Tax Bonds"), for the purpose of funding the acquisition, rehabilitation and construction of certain public improvements for the benefit of Improvement Area No. 2; and WHEREAS, on August 7, 2003 the Prior Special Tax Bonds were issued in the aggregate principal amount of $2,855,000; and WHEREAS, the Prior Special Tax Bonds are outstanding in the aggregate principal amount of $2,765000; and WHEREAS, as a result of a combination of favorable conditions in the municipal bond market and the level of development, diversity of ownership and increase in value of the properties within Improvement Area No. 2, the City Council has determined that it is necessary that bonds of the District to be designated "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013" be issued in an aggregate principal amount that will not exceed $3,100,000 (the 'Bonds') for the purpose of defeasing and refunding the Prior Special Tax Bonds in order to provide debt service savings and reduce the levy of the special taxes within Improvement Area No. 2; and WHEREAS, the Bonds shall be issued pursuant to the terms and provisions of the Act and the statement of goals and policies of the City Council regarding the establishment of community facilities districts, as amended to date (the "Goals and Policies"); and WHEREAS, payment of the principal of and interest on the Bonds will be secured by special taxes to be levied on parcels of taxable property in Improvement Area No. 2 (the "Special Taxes"); and WHEREAS, pursuant to Section 53345.8 of the California Government Code, the City Council, as the legislative body of the District, may sell bonds of the District for Improvement Area No. 2 only if it determines prior to the award of the sale of such bonds that the value of the real property that would be subject to the special tax to pay debt service on such bonds will be at least three (3) times the principal amount of such bonds to be sold and the principal amount of all other bonds outstanding that are secured by a special tax levied pursuant to the Act or a special assessment levied on property within Improvement Area No. 2; and WHEREAS, David Taussig & Associations, the special tax consultant to the City, has determined, based on a review of the San Bernardino County Assessor's Assessment Roll for fiscal year 2012-13, that the total assessed value of taxable property in Improvement Area No. 2 is $78,462,651; and WHEREAS, upon the issuance of the Bonds and the deposit of the appropriate portion of the proceeds of the sale of the Bonds in the escrow fund to be established to accomplish the defeasance and refunding of the Prior Special Tax 60297.00031\8029530.2 2 P714 Bonds, the Prior Special Tax Bonds will be defeased and the property in Improvement Area No. 2 will no longer be subject to the levy of special taxes to pay debt service on the Prior Special Tax Bonds; and WHEREAS, if the Bonds are issued and sold in an aggregate principal amount that does not exceed $3,100,000, the value of the parcels of real property within the District that will be subject to the levy of the Special Taxes will be more than three (3) times the principal amount of the Bonds; and WHEREAS, there will be no other bonds outstanding, other than the Bonds, that are secured by a special tax or a special assessment levied on property within Improvement Area No. 2; and WHEREAS, there has been presented to the City Council a form of Bond Purchase Agreement whereby Stifel, Nicolaus & Company, Incorporated, as underwriter (the "Underwriter") will purchase the Bonds from the District (the 'Bond Purchase Agreement'); and WHEREAS, there has also been presented to the City Council a form of Fiscal Agent Agreement with respect to the Bonds (the "Fiscal Agent Agreement') to be executed and delivered by the City and Wells Fargo Bank, National Association, as Fiscal Agent, whereby the Fiscal Agent will authenticate and deliver the Bonds and perform certain other duties; and WHEREAS, there has also been presented to the City Council a form of Escrow Deposit and Trust Agreement with respect to the Prior Special Tax Bonds (the "Escrow Agreement") to be executed and delivered by the City and Wells Fargo Bank, National Association, as Escrow Agent, whereby the Escrow Agent will receive a portion of the proceeds of the sale of the Bonds and certain funds related to the Prior Special Tax Bonds that will be deposited in an escrow fund to provide for the defeasance and redemption of the Prior Special Tax Bonds, and will perform certain other duties; and WHEREAS, there has also been presented to the City Council a form of Preliminary Official Statement relating to the Bonds (the "Preliminary Official Statement'); and WHEREAS, there has also been presented to the City Council a form of Continuing Disclosure Certificate to be executed and delivered by the City and Wells Fargo Bank, National Association, as Dissemination Agent (the "Continuing Disclosure Certificate"), for the benefit of the owners of the Bonds and in order to assist the Underwriter in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission (the `Rule"); and WHEREAS, the City Council has considered the forms of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Bond Purchase Agreement, the Preliminary Official Statement, and the Bond Purchase Agreement, and has determined that it is in the best interest of the owners of property in and the residents of the District that the City Council authorize the issuance and sale of 60297.00031A8029530.2 3 P715 the Bonds and the execution and delivery of said agreements, and approve and authorize the distribution of the Preliminary Official Statement, subject to the conditions hereinafter contained; NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED by the City Council of the City of Rancho Cucamonga, acting for and on behalf of the City and in its capacity as the legislative body of the District, as follows: Section 1. Findings. The City Council finds (a) that the preceding recitals are true and correct, (b) that the sale of the Bonds at private sale, without advertising for bids, will result in a lower overall cost to the District, (c) that if the Bonds are issued and sold in an aggregate principal amount that does not exceed $3,100,000, the value of the parcels of real property within the District that will be subject to the levy of the Special Taxes to pay the principal of and interest on the Bonds will be more than three (3) times the aggregate principal amount of the Bonds, and (d) that upon the issuance of the Bonds there will be no other bonds, other than the Bonds, that will be secured by a special tax or a special assessment levied on property within the District. In furtherance of the issuance of the Bonds, the City Council hereby makes the following further findings and determinations: (i) that it is prudent in the management of the fiscal affairs of the City, the City Council and the District to issue the Bonds for the purpose, inter alia, of refunding the Prior Special Tax Bonds on an current basis, (ii) that the total net interest cost to maturity on the portion of the Bonds being issued to refund the Prior Special Tax Bonds plus the principal amount of the portion of the Bonds being issued to refund the Prior Special Tax Bonds will not exceed the total net interest cost to maturity on the Prior Special Tax Bonds plus the principal amount of the Prior Special Tax Bonds, and (iii) that the issuance of the Bonds is in compliance with the City's Goals and Policies. For purposes of Section 53363.2 of the Act, the City Council hereby further finds and determines: (i) that it is expected that the purchase of the Bonds will occur on or after July 15, 2013, (ii) that the date, denomination, maturity dates, places of payment and form of the Bonds shall be as set forth in the Fiscal Agent Agreement, as executed, (iii) that the maximum true interest cost to be paid on the Bonds shall not exceed six percent (6.00°/x) with the actual rate or rates to be set forth in the Fiscal Agent Agreement as executed; (iv) the place of payment for the Prior Special Tax Bonds shall be as set forth in the fiscal agent agreement for the Prior Special Tax Bonds; and (v) the designated costs of issuing the Bonds shall be as described in Section 53363.8(a) of the Act, and as otherwise described in the Fiscal Agent Agreement, in the Official Statement for the Bonds and in the closing certificates for the Bonds, including Bond Counsel fees and expenses, Disclosure Counsel fees and expenses, Underwriter's discount, printing costs for the Official Statement, Special Tax Consultant, Financing Consultant, escrow verification costs, initial fiscal agent fees, fees for credit enhancement and ratings on the Bonds, and costs of City staff incurred in connection with the sale and issuance of the Bonds. 6029200031\8029530.2 4 P716 Section 2. Authorization of the Issuance of the Bonds. The City Council authorizes the issuance and sale of the Bonds in an aggregate principal amount that shall not exceed $3,100,000, and the City Manager (the "City Manager"), the Deputy City Manager (the "Deputy City Manager"), the Director of Finance (the "Director of Finance") of the City and such other designee of the City Manager (each of the City Manager, the Deputy City Manager, the Director of Financing and any such designee, an "Authorized Representative") are authorized and directed to take all steps and actions which are necessary to accomplish the issuance, sale and delivery of the Bonds pursuant to the authorization given by and the conditions specified in this resolution. The Mayor and the City Clerk of the City Council are authorized to execute the Bonds for and on behalf of the City and the District by their manual or facsimile signatures. The Bonds shall be dated as of their date of delivery pursuant to the Bond Purchase Agreement. The last maturity date of the Bonds shall not be later than the last maturity date of any of the Prior Special Tax Bonds. Each Authorized Representative, acting on behalf of the City or the District, as applicable, is hereby authorized and directed to execute and deliver the final form of the various documents and instruments described in this Resolution, with such additions thereto or changes therein as such Authorized Representative may deem necessary and advisable; provided, however, that no additions or changes shall authorize an aggregate principal amount of the Bonds in excess of the amount specified in the preceding paragraph. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery of such documents or instruments by an Authorized Representative, following consultation with and review by Best Best & Krieger LLP, as bond counsel. Section 3. Approval of Fiscal Agent Agreement. The Fiscal Agent Agreement which provides generally for (i) the authentication and delivery by the Fiscal Agent of the Bonds, (ii) the establishment and administration by the Fiscal Agent of certain funds and accounts for the benefit of the City and the owners of the Bonds, (iii) the payment by the Fiscal Agent of the principal of and interest on the Bonds from the Special Tax Revenues (as defined therein), and (iv) the performance of other duties by the Fiscal Agent, is approved in the form submitted to the City Council at the meeting at which this resolution is adopted. Section 4. Appointment of Fiscal Agent. Wells Fargo Bank, National Association is appointed as Fiscal Agent pursuant to the Fiscal Agent Agreement, to take any and all action provided therein to be taken by the Fiscal Agent. Section 5. Approval of Escrow Agreement. The Escrow Deposit and Trust Agreement (the "Escrow Agreement') which provides for (i) the defeasance and redemption of the Prior Special Tax Bonds, (ii) the creation and administration by the Escrow Agent of the Escrow Fund for the benefit of the owners of the Prior Special Tax Bonds, and (iii) the performance of other duties by the Escrow Agent, is approved in the form presented to the City Council at the meeting at which this resolution is adopted. 60297.00031\8029530.2 5 P717 Notwithstanding the preceding provisions of this section, as required by Section 53363.9 of the California Government Code, the amount of the proceeds of the sale of the Bonds and other amounts to be deposited in the Escrow Fund, and earnings from the investment thereof, shall be in an amount sufficient to pay the principal of and interest on the Prior Special Tax Bonds on September 1, 2013 and to pay the principal and redemption premium due on the Prior Special Tax Bonds on such date, and the designated costs of issuing the Bonds, as certified by a certified public accountant licensed to practice in the State of California. Section 6. Appointment of Escrow Agent. Wells Fargo Bank, National Association is appointed as Escrow Agent pursuant to the Escrow Agreement to take any and all action provided therein to be taken by the Escrow Agent. Section 7. Approval of Preliminary Official Statement; Preparation of Final Official Statement. The Preliminary Official Statement is approved, and each of the Authorized Representatives is authorized to consent to and assist in the preparation of such modifications thereto as may be specified by Jones Hall, disclosure counsel to the City ("Disclosure Counsel"). Each of the Authorized Representatives is authorized to determine, with the assistance of Disclosure Counsel, when the Preliminary Official Statement is to be deemed final within the meaning of the Rule and to deliver a certificate to that effect to the Underwriter. The Underwriter is authorized to distribute the Preliminary Official Statement as approved hereby, or as modified with the consent of one of the Authorized Representatives, to prospective purchasers of the Bonds. The City Manager, the Deputy City Manager and the Director of Finance are authorized to participate in the preparation of the Final Official Statement, based on the Preliminary Official Statement, and such modifications thereto as may be agreed to by Disclosure Counsel and the Underwriter. An Authorized Representative is authorized to sign the Final Official Statement on behalf of the City and the District. Section 8. Issuance of Bonds. The City Council approves and authorizes the issuance and sale of the Bonds by negotiation with the Underwriter and the City pursuant to the Bond Purchase Agreement between the City and the Underwriter in the form presented to the City Council at the meeting at which this resolution is adopted, together with any changes therein or additions thereto which are deemed advisable by the City Manager, the Deputy City Manager or the Director of Finance, upon consultation with Bond Counsel. An Authorized Representative is authorized and directed to execute and deliver the final form of the Bond Purchase Agreement on behalf of the City and the District upon the submission of an offer by the Underwriter to purchase the Bonds, which offer is acceptable to the City Manager, the Deputy City Manager or the Director of Finance and is consistent with the requirements of this resolution; provided that the interest rate on any maturity of the Bonds shall not exceed seven percent (7.00%) per annum; the Underwriter's discount for the purchase of the Bonds shall exceed one and one half percent (1 .50°/x) of the aggregate principal amount of the Bonds; and the last maturity of date of the Bonds shall not be later than the last maturity date of the Prior Special Tax Bonds. When the City Manager, the Deputy City Manager or the Director of Finance has negotiated the Bond Purchase Agreement with the Underwriter within the parameters specified above and when the 60297.00031\8029530.2 6 P718 other terms and conditions of the are satisfactory to the City Manager, the Deputy City Manager or the Director of Finance and Bond Counsel, an Authorized Representative is authorized to execute and deliver the Bond Purchase Agreement to the Underwriter on behalf of the City and the District. No Authorized Representative shall execute and deliver the Bond Purchase Agreement, however, unless the total net interest cost to maturity of the Bonds plus the principal amount of the Bonds will be less than the total net interest cost to maturity with respect to the Prior Special Tax Bonds, plus the principal amounts of the Prior Special Tax Bonds, and before executing and delivering the Bond Purchase Agreement, the Authorized Representative shall receive verbal verification from Fieldman Rolapp & Associates, as the Financial Advisor to the City and the District, that such a total net interest cost and principal amount with respect to the Bonds will be achieved. Section 9. Reserve Fund and Other Funds Related to the Prior Special Tax Bonds. The City Manager, the Deputy City Manager or the Director of Finance is authorized (i) to direct the fiscal agent for the Prior Special Tax Bonds, and said fiscal agent is authorized, to transfer the amount on deposit in the funds and accounts that are held by the fiscal agent pursuant to the fiscal agent agreement for the Prior Special Tax Bonds, including the reserve fund for the Prior Special Tax Bonds, to the Escrow Agent for deposit in the Escrow Fund to be used to defease and redeem the Prior Special Tax Bonds, or to transfer the amount of deposit in such reserve fund to the Reserve Fund for the Bonds, whichever the City Manager, the Deputy City Manager or the Director of Finance determines, in consultation with Bond Counsel, is most appropriate. Section 10. Notice of Redemption. The City Manager, the Deputy City Manager or the Director of Finance is authorized and directed to provide for the mailing, and the Fiscal Agent, in its capacity as fiscal agent for the Prior Special Tax Bonds is authorized to mail notice, of the redemption of Prior Special Tax Bonds to the registered owners thereof as required by Section 53365 of the California Government Code and the fiscal agent agreement for the Prior Special Tax Bonds. Pursuant to said Section 53365, the City Manager, the Deputy City Manager or the Director of Finance shall also provide for the mailing of, and the Fiscal Agent, as such fiscal agent, shall mail, notice of the redemption of the Prior Special Tax Bonds to the investment banking firm which was the original purchaser and underwriter of the Prior Special Tax Bonds. Section 11. Approval of Continuing Disclosure Certificate. The Continuing Disclosure Certificate is approved in the form submitted to the City Council at the meeting at which this resolution is adopted, and an Authorized Representative is authorized to execute and deliver said agreement on behalf of the City. Section 12. Action. All actions heretofore taken by the City Manager, the Deputy City Manager, the Director of Finance and the other officers and agents of the City, acting for and on behalf of the City or the District, with respect to the establishment of the District, and the sale and issuance of the Bonds are hereby approved, confirmed, 60297.00031\8029530.2 7 P719 and ratified, and the proper officers of the City, acting for and on behalf of the City or the Community Facilities Districts, as applicable, are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements, contracts, and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with the Act, this Resolution, the Fiscal Agent Agreement, the Bond Purchase Agreement, the Escrow Agreement, the Continuing Disclosure Certificate and any certificate, agreement, contract, and other document described in the documents herein approved. Section 13. Conditions of Approval. The approvals, authorization and direction given by this resolution are conditioned upon the satisfaction of the requirements of Section 8 hereof with respect to the issuance and sale of the Bonds. The officers of the City designated above shall not take any action with respect to the execution and delivery of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, and the Bond Purchase Agreement or the issuance, sale and delivery of the Bonds unless and until such conditions are satisfied; provided, however, that upon satisfaction of such conditions, this resolution shall be fully effective and shall be carried out by such officers without further approval or action of the City Council. The approvals, authorization and direction provided by this resolution shall continue, subject to the satisfaction of such conditions, until December 31, 2013, and the Bonds may be sold, and the Bonds, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Bond Purchase Agreement, the Preliminary Official Statement, and the Final Official Statement may be dated, entered into, executed and delivered or distributed, as appropriate, on any date selected by the City Manager, the Deputy City Manager or the Director of Finance and the Underwriter prior to said date. 60297.00031\8029530.2 8 P720 Section 14. Effective Date. This resolution shall take effect upon adoption and shall remain in effect until December 31, 2013, or if the Bonds are issued prior to said date, until all of the Bonds are paid at or redeemed prior to maturity. PASSED, APPROVED AND ADOPTED this day of November 2013. AYES: NOES: ABSENT: ABSTAINED: L. Dennis Michael, Mayor ATTEST: Janice C. Reynolds, City Clerk I, Janice C. Reynolds, City Clerk of the City of Rancho Cucamonga, California, do hereby certify that the foregoing Resolution was duly passed, approved and adopted by the City Council of the City of Rancho Cucamonga, at a regular meeting of said City Council held on 12013. Executed this at Rancho Cucamonga, California. Janice C. Reynolds, City Clerk 9 60297.0003 1\8029530.2 P721 FISCAL AGENT AGREEMENT by and between CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 and WELLS FARGO BANK, NATIONAL ASSOCIATION as Fiscal Agent Dated as of July 1, 2013 Relating to: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013 60285.00019\7762768.4 P722 TABLE OF CONTENTS Page FISCAL AGENT AGREEMENT.................................................................................................. 1 ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS...................................... 2 Section 1.01. Authority for this Agreement............................................................... 2 Section 1.02. Agreement for Benefit of Bondowners................................................ 2 Section1.03. Definitions............................................................................................ 3 ARTICLEII THE BONDS ................................................................................................... 9 Section 2.0.1. Principal Amounts; Designations ........................................................ 9 Section 2.02. Terms of Bonds.................................................................................... 9 Section 2.03. Redemption........................................................................................ 11 Section 2.04. Form of Bonds ................................................................................... 13 Section 2.05. Execution of Bonds............................................................................ 13 Section 2.06. Transfer of Bonds .............................................................................. 14 Section 2.07. Exchange of Bonds............................................................................ 14 Section2.08. Bond Register..................................................................................... 14 Section 2.09. Temporary Bonds............................................................................... 15 Section 2.10. Bonds Mutilated, Lost, Destroyed or Stol en...................................... 15 Section 2.11. Type and Nature of the Bonds; Limited Obligation .......................... 15 Section 2.12. Equality of Bonds and Pledge of Net Special Tax Revenues............ 16 Section 2.13. Description of Bonds; Interest Rates ................................................. 16 Section 2.14. No Acceleration................................................................................. 16 Section 2.15. Additional Bonds............................................................................... 16 Section 2.16. Validity of the Bonds......................................................................... 17 Section2.17. Book-Entry......................................................................................... 17 ARTICLE III ISSUANCE OF BONDS ............................................................................... 18 Section 3.01. Issuance and Delivery of the Bonds................................................... 18 Section 3.02. Application of Proceeds of Sale of the Bonds and Transfers from the Prior Special Tax Bonds...................................................... 19 Section 3.03. Special Tax Fund ............................................................................... 19 Section 3.04. Costs of Issuance Fund ...................................................................... 21 Section 3.05. Administrative Expense Fund............................................................ 21 60285.00019\7762768.4 -i- P723 TABLE OF CONTENTS (continued) Page ARTICLE IV NET SPECIAL TAX REVENUES; BOND FUND...................................... 22 Section 4.01. Pledge of Net Special Tax Revenues................................................. 22 Section4.02. Bond Fund.......................................................................................... 22 Section 4.03. Reserve Fund ..................................................................................... 23 ARTICLE V OTHER COVENANTS OF THE DISTRICT............................................... 24 Section5.01. Warranty ............................................................................................24 Section5.02. Covenants...........................................................................................24 Section 5.03. Punctual Payment............................................................................... 24 Section 5.04. Limited Obligation............................................................................. 25 Section 5.05. Payment of Claims............................................................................. 25 Section 5.06. Extension of Time for Payment......................................................... 25 Section 5.07. Against Encumbrances....................................................................... 25 Section 5.08. Books and Records ............................................................................25 Section 5.09. Protection of Security and Rights of Owners .................................... 25 Section 5.10. Collection of Special Tax Revenues..................................................25 Section 5.11. Further Assurances............................................................................. 26 Section 5.12. Tax Covenants ...................................................................................26 Section 5.13. Covenant to Foreclose........................................................................27 Section 5.14. Annual Reports to CDIAC.................................................................28 Section 5.15. Continuing Disclosure to Owners......................................................28 Section 5.16. Public Access to Facilities................................................................. 28 Section 5.17. Modification of Maximum Authorized Special Tax.......................... 28 Section 5.18. Covenant to Defend ........................................................................... 29 ARTICLE VI INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE DISTRICT.................................................................. 29 Section 6.01. Deposit and Investment of Moneys in Funds .................................... 29 Section 6.02. Rebate Fund; Rebate to the United States.......................................... 30 Section 6.03. Limited Obligation............................................................................. 30 Section 6.04. Liability of District ............................................................................ 31 Section 6.05. Employment of Agents by District or the City.................................. 32 60285.00019\7762768.4 _ii_ P724 TABLE OF CONTENTS (continued) Page ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS............ 32 Section 7.01. Events of Default ............................................................................... 32 Section 7.02. Remedies of Bond Owners................................................................ 32 Section 7.03. Application of Special Taxes and Other Funds After Default........... 33 Section 7.04. Absolute Obligation of the District.................................................... 33 Section 7.05. Termination of Proceedings............................................................... 34 Section 7.06. Remedies Not Exclusive.................................................................... 34 Section 7.07. No Waiver of Default......................................................................... 34 ARTICLE VIII THE FISCAL AGENT .................................................................................. 34 Section 8.01. Appointment of Fiscal Agent............................................................. 34 Section 8.02. Liability of Fiscal Agent.................................................................... 35 Section8.03. Information ........................................................................................ 36 Section 8.04. Notice to Fiscal Agent ....................................................................... 36 Section 8.05. Compensation, Indemnification......................................................... 37 ARTICLE IX MODIFICATION OR AMENDMENT OF THIS AGREEMENT............... 37 Section 9.01. Amendments Permitted...................................................................... 37 Section 9.02. Owners' Meetings.............................................................................. 38 Section 9.03. Procedure for Amendment with Written Consent of Owners............ 38 Section 9.04. Disqualified Bonds............................................................................. 39 Section 9.05. Effect of Supplemental Agreement.................................................... 39 Section 9.06. Endorsement or Replacement of Bonds Issued After Amendments...................................................................................... 39 Section 9.07. Amendatory Endorsement of Bonds.................................................. 39 ARTICLE X DEFEASANCE..............................................................................................40 Section10.01. Defeasance.........................................................................................40 ARTICLE XI MISCELLANEOUS ......................................................................................41 Section 11.01. Benefits of Agreement Limited to Parties .........................................41 Section 11.02. Cancellation of Bonds........................................................................41 Section 11.03. Successor is Deemed Included in All References to Predecessor ........................................................................................41 Section 11.04. Execution of Documents and Proof of Ownership by Owners..........41 60285.00019\7762768.4 _iii_ P725 TABLE OF CONTENTS (continued) Page Section 11.05. Waiver of Personal Liability.............................................................. 42 Section 11.06. Notices to and Demands on District and Fiscal Agent...................... 42 Section 11.07. Partial Invalidity.................................................................................43 Section 11.08. Unclaimed Moneys............................................................................43 Section 11.09. Provisions Constitute Contract ..........................................................43 Section 11.10. Future Contracts................................................................................. 43 Section 11.11. Further Assurances............................................................................. 43 Section 11.12. Applicable Law.................................................................................. 43 Section 11.13. Conflict with Act................................................................................44 Section 11.14. Conclusive Evidence of Regularity ...................................................44 Section 11.15. Payment on Business Day..................................................................44 Section11.16. Counterparts.......................................................................................44 EXHIBIT A FORM OF BOND.................................................................................................A-1 60285.00019\7762768.4 -iv- P726 FISCAL AGENT AGREEMENT THIS FISCAL AGENT AGREEMENT (the "Agreement') is made and entered into as of July 1, 2013, by and between the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District'), a community facilities district, organized and existing under and by virtue of the laws of the State of California, and Wells Fargo Bank, National Association, a national banking association organized and existing under the laws of the United States of America, as fiscal agent (the "Fiscal Agent'). WITNESSETH: WHEREAS, the City Council of the City of Rancho Cucamonga (the "City") has formed the District and designated Improvement Area No. 2 therein under the provisions of the Mello- Roos Community Facilities Act of 1982, as amended (Section 53311 et seq. of the California Government Code) (the "Act') and Resolution No. 03-031 of the City Council adopted on February 19, 2003; WHEREAS, the City Council is authorized under the Act and pursuant to Ordinance No. 699 to levy special taxes within Improvement Area No. 2 to pay for the costs of facilities provided by the District; WHEREAS, under the provisions of the Act, on February 19 , 2003, the City Council, acting as the legislative body of the District and Improvement Area No. 2, adopted Resolution No. 03-032 (the "Resolution") which resolution, among other matters, expressed the determination of the City Council of the necessity to issue special tax bonds in the maximum aggregate principal amount of$4,000,000 for Improvement Area No. 2 of the District secured by the special taxes; WHEREAS, on May 21, 2003, the City Council adopted Resolution No. 03-125 (the "Resolution") authorizing the issuance and sale of bonds for the District pursuant to the Fiscal Agent Agreement, dated as of July 1, 2003 (the "Prior Fiscal Agent Agreement'), by and between the City of Rancho Cucamonga, for and on behalf of the District, and Wells Fargo Bank, National Association, as fiscal agent, designated the "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-13" (the "Prior Special Tax Bonds"), for the purpose of funding the acquisition, rehabilitation and construction of certain public improvements (defined in the Prior Fiscal Agent Agreement as the "Project'); WHEREAS, on August 7, 2003 the Prior Special Tax Bonds in the principal amount of $2,855,000 were issued; WHEREAS, on July 3, 2013, the City Council adopted Resolution No. 13- (the "Resolution of Issuance") authorizing the issuance and sale of bonds of the District pursuant to this Agreement designated "City of Rancho Cucamonga Community Facilities District No. 2003- 01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013" (the "Bonds"), for the purpose of financing the defeasance and refunding of the Prior Special Tax Bonds; 60285.00019\7762768.4 1 P727 WHEREAS, it is in the public interest and for the benefit of the City, the District, the persons responsible for the payment of special taxes and the owners of the Bonds that the District enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the Bonds, and the administration and payment of the Bonds; WHEREAS, all things necessary to cause the Bonds, when authenticated by the Fiscal Agent and issued as provided in the Act, the Resolution and this Agreement, to be legal, valid and binding and limited obligations in accordance with their terms, and all things necessary to cause.the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized; NOW, THEREFORE, in order to secure the payment of the principal of, premium, if any, and the interest on all Bonds at any time issued and outstanding under this Agreement, according to their tenor, and to secure the performance and observance of all the covenants and conditions therein and herein set forth, and to declare the terms and conditions upon and subject to which the Bonds are to be issued and received, and in consideration of the premises and of the mutual covenants herein contained and of the purchase and acceptance of the Bonds by the holders thereof, and for other valuable considerations, the receipt of which is hereby acknowledged, the District does hereby covenant and agree with the Fiscal Agent, for the benefit of the respective holders from time to time of the Bonds, as follows: ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Section 1.01. Authority for this Agreement. This Agreement is entered into pursuant to the provisions of the Act and the Resolution. Section 1.02. Agreement for Benefit of Bondowners. The provisions, covenants and agreements herein set forth to be performed by or on behalf of the District shall be for the equal benefit, protection, and security of the Owners from time to time. In consideration of the acceptance of the Bonds by the Owners thereof, this Agreement shall be deemed to be and shall constitute a contract between the District and the Owners; and the covenants and agreements herein set forth to be performed by the District shall be for the equal and proportionate benefit, security, and protection of all Owners of the Bonds without preference, priority or distinction as to security or otherwise of any of the Bonds over any of the others by reason of the number or date thereof or the time of sale, execution, or delivery thereof, or otherwise for any cause whatsoever, except as expressly provided therein or herein. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided in or permitted by this Agreement. The Fiscal Agent may become the Owner of any of the Bonds in its own or any other capacity with the same rights it would have if it were not Fiscal Agent. 60285.000!9\7762768.4 2 P728 Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words "herein," "hereof," "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Article, Section or subdivision hereof. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311 et seq. of the California Government Code. "Administrative Expense Fund" means the fund by that name established by Section 3.05 hereof. "Administrative Expenses" means any or all of the following: the fees and expenses of the Fiscal Agent (including the fees and expenses of its counsel), the expenses of the City, acting for and on behalf of the District, or the District in carrying out its duties hereunder (including, but not limited to, the levying and collection of the Special Taxes, complying with the disclosure provisions of the Act, the Continuing Disclosure Agreement and this Agreement, including those related to public inquiries regarding the Special Tax and disclosures to Bondowners and the Original Purchaser); the costs of the City and the District or their designees related to an appeal of the Special Tax; any costs of the City and the District (including fees and expenses of counsel) to defend the first lien on and pledge of the Special Taxes to the payment of the Bonds or otherwise in respect of litigation relating to the District or the Bonds or with respect to any other obligations of the District, the salaries of City staff directly related to the carrying out by the City, for and on behalf of the District, the District's obligations hereunder and a proportionate amount of City general administrative overhead related thereto allocable to the Bonds; and all other costs and expenses of the City, the District, and the Fiscal Agent incurred in connection with the discharge of their respective duties hereunder, and in the case of the City, in any way related to the administration of the District and all actual costs and expenses incurred in connection with the administration of the Bonds. "Agreement" means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement adopted pursuant to the provisions hereof. "Annual Debt Service" means, for each Bond Year, the sum of(i) the interest due on the Outstanding Bonds in such Bond Year, and (ii) the principal amount of the Outstanding Bonds scheduled to be paid in such Bond Year. "Auditor" means the auditor/tax collector of the County of San Bernardino. "Authorized Officer" means the City Manager, Assistant City Manager, Deputy City Manager, Director of Finance, or City Clerk of the City, or any other officer or employee authorized by the City Council of the City or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer. 60285.00019\7762768.4 3 P729 "Bond Counsel" means (i) Best Best & Krieger LLP; or (ii) any attorney or firm of attorneys acceptable to the District and nationally recognized for expertise in rendering opinions as to the legality and tax-exempt status of securities issued by public entities. "Bond Fund"means the fund by that name established by Section 4.02A hereof. "Bond Year" means the one-year period beginning on September 2 in each year and ending on September 1 in the following year except that the first Bond Year shall begin on the Closing Date and end on September 1, 2013. "Bonds" means the City of Rancho Cucamonga Community Facilities District No. 2003- 01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013, authorized by, and at any time Outstanding pursuant hereto. "Business Day" means a day which is not a Saturday, Sunday, or legal holiday on which banking institutions in the State of California, or in any state in which the Principal Office of the Trustee is located, or the New York Stock Exchange are closed. If any payment hereunder is due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day with the same effect as if made on such previous day. "CDIAC" means the California Debt and Investment Advisory Commission of the office of the State Treasurer of the State of California or any successor agency or bureau thereto. "City"means the City of Rancho Cucamonga, California. "City Council" means the City Council of the City, acting in its capacity as the legislative body of the District. "Closing Date" means the date upon which there is a physical delivery of the Bonds in exchange for the amount representing the purchase price of the Bonds by the Original Purchaser. "Code" means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable proposed, temporary and final regulations promulgated, and applicable official public guidance published, under the Code. "Continuing Disclosure Certificate" means that certain Continuing Disclosure Certificate relating to the Bonds, executed on the Closing Date by City, as originally executed and as it may be amended from time to time in accordance with the terms thereof. "Costs of Issuance" means items of expense payable or reimbursable directly or indirectly by the District and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding documents, including but not limited to the preliminary official statement and official statement regarding the Bonds, closing costs, filing and recording fees, initial fees and charges of the Fiscal Agent including its first annual administration fee and the fees of its counsel, expenses incurred by the District in connection with the issuance of the Bonds, legal fees and charges, 60285.00019\7762768.4 4 P730 including the fees of Bond Counsel and Disclosure Counsel, financial advisor's fees, charges for authentication, transportation and safekeeping of the Bonds and other costs, charges and fees in connection with the foregoing. "County" means the County of San Bernardino, California. "Debt Service" means the scheduled amount of interest and amortization of principal payable on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. "Defeasance Obligations" means those obligations described in paragraph A. of the definition of Permitted Investments. "District" means the City of Rancho Cucamonga Community Facilities District No. 2003-01 formed pursuant to the Resolution of Formation. "DTC"means the Depository Trust Company. "Escrow Agent" means Wells Fargo Bank, National Association, acting as escrow agent under the Escrow Agreement. "Escrow Agreement" means that Escrow Agreement Deposit and Trust Agreement dated as of July 1, 2013 by and between the District and the Escrow Agent relating to defeasance of the Prior Special Tax Bonds. "Fair Market Value" means the price at which a willing buyer would purchase the investment from a willing seller in a bona fide, arm's length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of section 1273 of the Code) and, otherwise, the term "Fair Market Value" means the acquisition price in a bona fide arm's length transaction (as referenced above) if(i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code; (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement)that is acquired in accordance with applicable regulations under the Code; (iii) the investment is a United States Treasury Security - State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt; or (iv) any commingled investment fund in which the City and related parties do not own more than a ten percent (10%) beneficial interest therein if the return paid by the fund is without regard to the source of the investment. "Fiscal Agent" means the Fiscal Agent appointed by the District and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 8.01. "Fiscal Year" means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive. 60285.00019\7762768.4 5 P731 "Independent Accountant" means any nationally recognized firm of certified public accountants or firm of such accountants duly licensed or registered or entitled to practice and practicing as such under the laws of the State, appointed by the City, acting for and on behalf of the District, and who, or each of whom: (1) is in fact independent and not under domination of the City or the District; (2) does not have any substantial interest, direct or indirect, with the City or the District; and (3) is not connected with the City or the District as an officer or employee of the City or the District, but who may be regularly retained to make reports to the City or the District. "Independent Financial Consultant" means any financial consultant or firm of such financial consultants appointed by the City, acting for and on behalf of the District, and who, or each of whom: (1) is judged by the City to have experience with respect to the financing of public capital improvement projects; (2) is in fact independent and not under the domination of the City or the District; (3) does not have any substantial interest, direct or indirect, with the City or the District; and (4) is not connected with the City, or the District as an officer or employee of the City or the District, but who may be regularly retained to make reports to the City, or the District. "Interest Payment Dates" means March 1 and September 1 of each year, commencing September 1, 2013. "Investment Earnings" means all interest earned and any gains and losses on the investment of moneys in any fund or account created by this Agreement. "Maximum Annual Debt Service" means the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of any Outstanding Bonds. "Net Special Tax Revenues" means, for each Fiscal Year, all Special Tax Revenues received by the District less an amount equal to the Priority Administrative Expenses Amount. "Officer's Certificate" means a written certificate of the District or the City signed by an Authorized Officer of the City. "Ordinance" means an ordinance of the City levying the Special Taxes, including Ordinance No. 699, adopted by the City Council on , 2003. 60285.00019\7762768.4 6 P732 "Original Purchaser" means the first purchaser of the Bonds from the District. "Outstanding," means (subject to the provisions of Section 9.04), when used as of any particular time with reference to Bonds, all Bonds except: (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 10.01; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued, and delivered by the District pursuant to this Agreement or any Supplemental Agreement. "Owner" or `Bondowner" means any person who shall be the registered owner of any Outstanding Bond. "Penalties and Interest" means any penalties or interest in excess of the interest payable on the Bonds collected in connection with delinquent Special Taxes. "Penalties and Interest Account" means the account by that name within the Special Tax Fund pursuant to Section 3.03D hereof. "Permitted Investments" shall have the meaning given such term in Exhibit B hereto. "Person" means an individual, corporation, firm, association, partnership, trust, or other legal entity or group of entities, including a governmental entity or any agency or political subdivision thereof. "Prepayments" means Special Tax Revenues identified to the Fiscal Agent by an Authorized Officer as representing a prepayment of the Special Tax pursuant to the RMA. "Principal Office" means the principal corporate trust office of the Fiscal Agent as may be designated from time to time by the Fiscal Agent in writing to the District initially set forth in Section 11.06 hereof. "Prior Fiscal Agent Agreement" means the Fiscal Agent Agreement, dated as of July 1, 2003, by and between the District and Wells Fargo Bank, National Association, as fiscal agent, pertaining to the Prior Special Tax Bonds. "Prior Special Tax Bonds" means the outstanding City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-B. "Priority Administrative Expense Amount" means an annual amount equal to $12,190.00 for fiscal year 2013-14 subject to escalation by 2% each fiscal year thereafter commencing July 1, 2014, or such lesser amount as may be designated by written instruction from an Authorized Officer of the District to be allocated as the first priority of Special Taxes received each Fiscal Year for the payment of Administrative Expenses allocated to the Bonds. "Project" shall have the meaning given such term in the Prior Fiscal Agent Agreement. 60285.00019\7762768.4 7 P733 "Rebate Certificate" means the certificate delivered by the District upon the delivery of the Bonds relating to Section 148 of the Code, or any functionally similar replacement certificate. "Rebate Fund" means the fund by that name established by Section 6.02 hereof. "Record Date" means the fifteenth day of the month next preceding the month of the applicable Interest Payment Date. "Representation Letter" means the representation letter which the City has delivered to The Depository Trust Company ("DTC") with respect to the utilization of the book-entry system maintained by DTC for the issuance and registration of bonds. "Reserve Fund" means the fund by that name established by Section 4.03 hereof. "Reserve Requirement" means on any date in any Bond Year the lesser of(i) ten percent (10%) of the stated principal amount of the Bonds, (ii) Maximum Annual Debt Service on the Bonds or (iii) 125 percent of average Annual Debt Service on the Bonds, as determined by the District. "Resolution of Formation" means Resolution No. 03-031, adopted by the City Council on February 19, 2003. "Resolution of Issuance" shall have the meaning given such term in the recitals hereto. "RMA" means the Rate and Method of Apportionment of the Special Tax for the District approved by the qualified electors within Improvement Area No. 2 of the District at a special election held on February 19, 2003. "Special Tax Fund" means the fund by that name established by Section 3.03A hereof. "Special Tax Revenues" means the proceeds of the Special Taxes received by the District including any scheduled payments and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest and penalties thereon. Notwithstanding the foregoing, "Special Tax Revenues" does not include Penalties and Interest. "Special Taxes" means the special taxes levied within Improvement Area No. 2 of the District pursuant to the Act, the RMA, the Ordinance, and this Agreement. "Supplemental Agreement" means an agreement the execution of which is authorized by a resolution which has been duly adopted by the City Council under the Act and which agreement is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder. "Treasurer" means the person who is acting in the capacity as treasurer or finance director to the City or the designee of either such officer. 60285.00019\7762768.4 8 P734 ARTICLE II THE BONDS Section 2.01. Principal Amounts; Designations. Bonds in the aggregate principal amount of Dollars ($ ) are hereby authorized to be issued by the District under and subject to the terms of the Resolution of Issuance and this Agreement, the Act and other applicable laws of the State of California. The Bonds shall be designated "City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013." This Agreement constitutes a continuing agreement of the District with the Owners from time to time of the Bonds to secure the full payment of the principal of, premium, if any, and interest on all such Bonds subject to the covenants, provisions, and conditions herein contained. Section 2.02. Terms of Bonds. A. Form; Denominations. The Bonds shall be issued as fully registered bonds without coupons in the denomination of $5,000 or any integral multiple thereof; provided, however, one Bond from each maturity may be in an amount other than $5,000 or an integral multiple thereof. The Bonds shall be lettered and numbered in a customary manner as determined by the Fiscal Agent. B. Date of the Bonds. The Bonds shall be dated the Closing Date. C. Maturities, Interest Rates. The Bonds shall mature on the dates and shall bear interest at the rates as follows: 60285.00019\7762768.4 9 P735 Maturity Date (September 1) Principal Maturity Interest Rate 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 D. Interest. The Bonds shall bear interest at the rates set forth above payable five (5) days preceding the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. E. Method of Payment. Interest on the Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check or draft of the Fiscal Agent mailed at least five (5) days preceding the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest 60285.00019\7762768.4 10 P736 Payment Date, or by wire transfer made on such Interest Payment Date upon instructions of any Owner of$1,000,000 or more in aggregate principal amount of Bonds. The principal of the Bonds and any premium on the Bonds are payable in lawful money of the United States of America upon surrender of the Bonds at the Principal Office of the Fiscal Agent. All Bonds paid by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and issue a certificate of destruction thereof to the District. Section 2.03. Redemption. A. Optional Redemption. The Bonds may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of$5,000) on any Interest Payment Date, from such maturities as are selected by the District, and by lot within a maturity, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20_ 10_% March 1, 20 and September 1, 20 10 March 1, 20 and September 1, 26— March 1, 20_and any Interest Payment Date thereafter 100 B. Mandatory Redemption from the Prepayment of Special Taxes. The Bonds shall be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20 103% March 1, 20 and September 1, 20 102 March 1, 20 and September 1, 20 101 March 1, 20 and on any Interest Payment Date thereafter 100 C. Purchase In Lieu of Redemption. In lieu of redemption under Section 2.03A or 2.03B, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to 60285.00019\7762768.4 11 P737 the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the Bonds. D. Notice to Fiscal Agent. The District shall give the Fiscal Agent written notice of its intention to redeem Bonds pursuant to Section 2.03A or 2.03B not less than sixty (60) days prior to the applicable redemption date, unless such notice shall be waived by the Fiscal Agent, unless the Fiscal Agent agrees to a shorter period. E. Redemption Procedure by Fiscal Agent. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption, to the respective registered Owners of any Bonds designated for redemption, at their addresses appearing on the Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds. Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the Bond numbers of the Bonds to be redeemed by giving the individual Bond number of each Bond to be redeemed or shall state that all Bonds between two stated Bond numbers, both inclusive, are to be redeemed or that all of the Bonds of one or more maturities have been called for redemption, shall state as to any Bond called in part the principal amount thereof to be redeemed, and shall require that such Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such Bonds will not accrue from and after the redemption date. The cost of mailing any such redemption notice and any expenses incurred by the Fiscal Agent in connection therewith shall be paid by the District. Upon the payment of the redemption price of Bonds being redeemed, each check or other transfer of funds issued for such purpose shall, to the extent practicable, bear the Bond number identifying, by issue and maturity, the Bonds being redeemed with the proceeds of such check or other transfer. The District shall have the right to rescind any notice of redemption for any optional or mandatory redemption pursuant to Section 2.03(A) or Section 2.03(B) hereof, on or prior to the date fixed for redemption. Any notice of optional redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date so fixed for redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall not constitute an Event of Default hereunder. The Fiscal Agent shall have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent shall mail notice of such recession of redemption in the same manner as the original notice of redemption. 60285.00019\7762768.4 12 P738 If less than all the Bonds Outstanding are to be redeemed, the portion of any Bond of a denomination of more than $5,000 to be redeemed shall be in the principal amount of$5,000 or a multiple thereof, and, in selecting portions of such Bonds for redemption, the Fiscal Agent shall treat each such Bond as representing the number of Bonds of $5,000 denominations which is obtained by dividing the principal amount of such Bond to be redeemed in part by $5,000. Whenever provision is made in this Agreement for the redemption of less than all of the Bonds or any given portion thereof, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof not previously called for redemption, among maturities as specified by the District in a written certificate delivered to the Fiscal Agent, and by lot within a maturity in any manner which the District in its sole discretion shall deem appropriate and fair. In providing such certificate, the District shall provide for the redemption of Bonds such that the remaining Debt Service payable on the Bonds shall remain level as possible. Upon surrender of Bonds redeemed in part only, the District shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the District, a new Bond or Bonds, of the same Series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds. F. Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the Bonds so called for redemption shall have been deposited in the Bond Fund, such Bonds so called shall cease to be entitled to any benefit under this Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice. All Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and, upon written request of the District, issue a certificate of destruction thereof to the District. Section 2.04. Form of Bonds. The Bonds, the form of Fiscal Agent's certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution, and the Act. The Bonds of any other Series and the form of the certificate of authentication and assignment to appear thereon shall be in such form or forms as may be specified in the Supplemental Agreement creating such Series of Bonds. Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the District by the manual or facsimile signatures of the Mayor and City Clerk, who are in office on the date of adoption of this Agreement or at any time thereafter. The Bonds shall then be delivered to the Trustee for authentication. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the Owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the Owner. Any Bond may be signed and attested on behalf of the District by such persons as at the actual date of the execution of such Bond shall be the proper officers of the 60285.00019\7762768.4 13 P739 District although at the nominal date of such Bond any such person shall not have been such officer of the District. Only such Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, executed and dated by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Agreement, and such certificate of authentication of the Fiscal Agent shall be conclusive evidence that the Bonds registered hereunder have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Agreement. Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the District shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for like aggregate principal amount. No transfers of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Section 2.07. Exchange of Bonds. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange. No exchanges of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii)between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Section 2.08. Bond Register. The Fiscal Agent will keep or cause to be kept, at its Principal Office sufficient books for the registration and transfer of the Bonds which books shall show the number, date, amount, rate of interest and last known Owner of each Bond and shall at all times be open to inspection by the District or the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the Bonds as hereinbefore provided. 60285.00019\7762768.4 14 P740 The District and the Fiscal Agent will treat the Owner of any Bond whose name appears on the Bond register as the absolute Owner of such Bond for any and all purposes, and the District and the Fiscal Agent shall not be affected by any notice to the contrary. The District and the Fiscal Agent may rely on the address of the Bond Owner as it appears in the Bond register for any and all purposes. Section 2.09. Temporary Bonds. The Bonds may be initially issued in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such authorized denominations as may be determined by the District, and may contain such reference to any of the provisions of this Agreement as may be appropriate. Every temporary Bond shall be executed by the District upon the same conditions and in substantially the same manner as the definitive Bonds. If the District issues temporary Bonds it will execute and furnish definitive Bonds without delay and thereupon the temporary Bonds shall be surrendered, for cancellation, in exchange for the definitive Bonds at the Principal Office of the Fiscal Agent or at such other location as the Fiscal Agent shall designate, and the Fiscal Agent shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary bonds shall be entitled to the same benefits under this Agreement as definitive Bonds authenticated and delivered hereunder. Section 2.10. Bonds Mutilated, Lost, Destroyed or Stolen. If any Bond shall become mutilated, the District, at the expense of the Owner of said Bond, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and destroyed by the Fiscal Agent, who shall deliver a certificate of destruction thereof to the District. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the District and the Fiscal Agent satisfactory to the Fiscal Agent shall be given, the District, at the expense of the Owner, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The District may require payment of a sum not exceeding the actual cost of preparing each new Bond delivered under this Section and of the expenses which may be incurred by the District and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the District whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement. Section 2.11. Type and Nature of the Bonds; Limited Obligation. Neither the faith and credit nor the taxing power of the City, the State of California or any political subdivision thereof other than the District is pledged to the payment of the Bonds. Except for the Special Taxes, no other taxes are pledged to the payment of the Bonds. The Bonds are not general or special obligations of the City nor general obligations of the District but are limited obligations of the District payable solely from Net Special Tax Revenues. The District's limited obligation to pay the principal of, premium, if any,. and interest on the Bonds from the Net Special Tax 60285.00019\7762768.4 15 P741 Revenues is absolute and unconditional, free of deductions and without any abatement, offset, recoupment, diminution or set-off whatsoever. No Owner of the Bonds may compel the exercise of the taxing power by the District (except as it pertains to the Special Taxes) or the City or the forfeiture of any of their property. The principal of and interest on the Bonds and premiums upon the redemption thereof, if any, are not a debt of the City, the State of California or any of its political subdivisions except the District within the meaning of any constitutional or statutory limitation or restriction. The Bonds are not a legal or equitable pledge, charge, lien, or encumbrance upon any of the District's property, or upon any of its income, receipts or revenues, except the Net Special Tax Revenues and amounts on deposit in the Special Tax Fund and the Bond Fund to the extent pledged hereunder which are, under the terms of this Agreement and the Act, set aside for the payment of the Bonds and interest thereon and neither the members of the legislative body of the District nor any persons executing the Bonds are liable personally on the Bonds by reason of their issuance. Section 2.12. Equality of Bonds and Pledge of Net Special Tax Revenues. Pursuant to the Act and this Agreement, the Bonds shall be equally payable from the Net Special Tax Revenues and other amounts in the Special Tax Fund without priority for number, date of the Bonds, date of sale, date of execution, or date of delivery, and the payment of the interest on and principal of the Bonds and any premiums upon the redemption thereof, shall be exclusively paid from the Net Special Tax Revenues and other certain other amounts in the Special Tax Fund, which are hereby set aside for the payment of the Bonds. Amounts in the Special Tax Fund shall constitute a trust fund held for the benefit of the Owners to be applied to the payment of the interest on and principal of the Bonds and so long as any of the Bonds or interest thereon remain Outstanding shall not be used for any other purpose, except as permitted by this Agreement. Nothing in this Fiscal Agent Agreement shall preclude, subject to the limitations contained hereunder, the redemption prior to maturity of any Bonds subject to call and redemption and payment of said Bonds from proceeds of refunding bonds issued under the Act as the same now exists or as hereafter amended, or under any other law of the State of California, which shall be payable from Net Special Tax Revenues. Section 2.13. Description of Bonds; Interest Rates. The Bonds and any Parity Bonds shall be issued in fully registered form in any denomination. The Bonds and any Parity Bonds of each issue shall be numbered as desired by the Fiscal Agent. Section 2.14. No Acceleration. The principal of the Bonds shall not be subject to acceleration hereunder. Nothing in this Section shall in any way prohibit the prepayment or redemption of Bonds under Section 2.03 hereof, or the defeasance of the Bonds and discharge of this Agreement under Section 10.01 hereof. Section 2.15. Additional Bonds. Other than for the purpose of refunding the Bonds, no additional Bonds entitled to a lien on the Net Special Tax Revenues shall be issued hereunder. 60285.00019\7762768.4 16 P742 Section 2.16. Validity of the Bonds. The validity of the authorization and issuance of the Bonds shall not be affected in any way by any defect in any proceedings taken by the District for the issuance and sale of the Bonds and the recital contained in the Bonds that the same are issued pursuant to the Act and other applicable laws of the State shall be conclusive evidence of their validity and the regularity of their issuance. Section 2.17. Book-Entry. The Bonds shall be initially issued in the form of a single, fully registered Bond for each maturity (which may be typewritten). Upon initial issuance, the ownership of such Bonds shall be registered in the name of the Nominee identified below as nominee of The Depository Trust Company, New York, New York and its successors and assigns (the "Depository" or "DTC"). Except as hereinafter provided, all of the Outstanding Bonds shall be registered in the name of the nominee of the Depository, which may be the Depository, as determined from time to time pursuant to this Section 2.17 (the "Nominee"). With respect to the Bonds registered in the name of the Nominee, neither the District nor the Fiscal Agent shall have any responsibility or obligation to any broker-dealers, banks and other financial institutions from time to time for which the Depository holds Bonds as securities depository (the "Participant") or to any person on behalf of which such a Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, neither the District nor the Fiscal Agent shall have any responsibility, liability or obligation whatsoever with respect to (i) the accuracy of the records of the Depository, the Nominee, or any Participant with respect to any ownership interest in the Bonds; (ii) the delivery to any Participant or any other person, other than an Owner of a Bond as shown in the registration books maintained by the Fiscal Agent pursuant to Section 2.08 hereof(the "Registration Books"), of any notice with respect to the Bonds, including any notice of redemption; (iii) the selection by the Depository and its Participants of the beneficial interests in the Bonds to be redeemed in the event the District redeems the Bonds in part; or (iv) the payment to any Participant or any other person, other than an Owner of a Bond as shown in the Registration Books, of any amount with respect to principal of or interest on the Bonds. The District and the Fiscal Agent may treat and consider conclusively the person in whose name each Bond is registered as the holder and absolute Owner of such Bond for the purpose of payment of principal and interest with respect to such Bond, for the purpose of giving notices of redemption, if applicable, and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The District shall pay all principal of and interest on the Bonds only to or upon the order of the respective Owner of a Bond, as shown in the Registration Books, or his or her attorney duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the District's obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than an Owner of a Bond, as shown in the Registration Books, shall receive a Bond evidencing the obligation of the District to make payments of principal and interest pursuant to this Agreement. Upon delivery by the Depository to the Owners of the Bond, and the District of written notice to the effect that the Depository has determined to substitute a new nominee in place of the Nominee, and subject to the provisions herein with respect to Record Dates, the word Nominee in this Agreement shall refer to such nominee of the Depository. 60285.00019\7762768.4 17 P743 In the event (i) the Depository determines not to continue to act as securities depository for the Bonds, or(ii) the Depository shall no longer so act and gives notice to the District of such determination, then the District will discontinue the book-entry system with the Depository. If the District determines to replace the Depository with another qualified securities depository, the District shall prepare or direct the preparation of a new, single, separate, fully registered Bond, . per maturity, registered in the name of such successor or substitute qualified securities depository or its nominee. If the District fails to identify another qualified securities depository to replace the Depository, then the Bonds shall no longer be restricted to being registered in the Registration Books in the name of the Nominee, but shall be registered in whatever name or names Owners of the Bonds transferring or exchanging Bonds shall designate, in accordance with the provisions of Sections 2.06 and 2.07 hereof, and the District shall prepare and deliver Bonds to the Fiscal Agent for authentication and delivery to the Owners thereof for such purpose. In the event of a reduction in aggregate principal amount of Bonds Outstanding or an advance refunding of part of the Bonds Outstanding, the Depository, in its discretion, (i) may request the District to prepare and issue a new Bond or (ii) may make an appropriate notation on a Bond indicating the date and amounts of such reduction in principal, but in such event the Registration Books maintained by the Fiscal Agent shall be conclusive as to what amounts are Outstanding with respect to the Bond, except in the case of final maturity, in which case the Bond must be presented to the Fiscal Agent prior to payment. Notwithstanding any other provision of this Agreement to the contrary, so long as any Bond is registered in the name of the Nominee, all payments of principal and interest with respect to such Bond and all notices with respect to such Bond shall be made and given, respectively, as provided in the Representation Letter or as otherwise instructed by the Depository and acceptable to the District. The initial Nominee shall be Cede & Co., as Nominee of DTC. ARTICLE III ISSUANCE OF BONDS Section 3.01. Issuance and Delivery of the Bonds. At any time after the execution of this Agreement, the District may issue the Bonds in the aggregate principal amount set forth in Section 2.01 and deliver the Bonds to the Original Purchaser. The Authorized Officers of the District are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of the Bonds in accordance with the provisions of the Act, the Resolution of Issuance and this Agreement and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser, upon payment of the purchase price for the Bonds. 60285.00019\7762768.4 18 P744 Section 3.02. Application of Proceeds of Sale of the Bonds and Transfers from the Prior Special Tax Bonds. The proceeds of the purchase of the Bonds by the Original Purchaser (being $ equal to the par amount of$ minus the purchaser's discount of $ ) shall be paid to the Fiscal Agent, who shall forthwith set aside, pay over and transfer such proceeds on the Closing Date as follows: A. $ shall be transferred to the Escrow Agent for deposit into the Escrow Fund held by the Escrow Agent under the Escrow Agreement; B. $ shall be deposited into the Reserve Fund, the Reserve Requirement as of the Closing Date; and C. $ shall be deposited in the Costs of Issuance Fund. Section 1.03. Special Tax Fund. A. Establishment of Special Tax Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the "Special Tax Fund," to the credit of which the District or the City, on behalf of the District, shall deposit, immediately upon receipt, all Special Tax Revenue received by the District or the City, on behalf of the District. Moneys in the Special Tax Fund, other than Penalties and Interest, shall be held by the Fiscal Agent for the benefit of the District and the Owners of the Bonds, shall be disbursed as provided below and, pending any disbursement, shall be subject to a lien in favor of the Owners of the Bonds. B. Disbursements of Special Tax Revenues. The Special Tax Revenues deposited in the Special Tax Fund shall be held and, other than Special Tax Revenues representing Prepayments, subsequently transferred to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 1. to the District for deposit in Administrative Expense Fund an amount equal to the Priority Administrative Expense Amount estimated to be due and payable during the Fiscal Year; 2. not later than ten (10) Business Days prior to each Interest Payment Date, to the Bond Fund: a. the amount representing past due installments of principal, interest and premium on the Bonds (including any interest thereon pursuant to the second sentence of the second paragraph of Section 4.02B), if any, resulting from the delinquency in the payment of such Special Taxes; and b. an amount, taking into account any amounts then on deposit in the Bond Fund (other than by reason of the preceding paragraph a.) such that the amount in the Bond Fund equals the principal, premium, if any, and interest due on the Bonds on the next Interest Payment Date; 60285.00019\7762768.4 19 P745 3. no later than ten (10) Business Days prior to each Interest Payment Date, to the Reserve Fund that amount, in addition to the amount transferred to the Bond Fund pursuant to paragraph 2. above, necessary to replenish any draw on the Reserve Fund; 4. on September 2 of each year after making the deposits and transfers required under paragraphs 1 and 2 above and the transfer, if any, authorized under paragraph 3 above, to the Rebate Fund, upon receipt of written instructions from an Authorized Officer on or before the preceding June 30, the amount specified in such written instructions necessary for the payment of any rebate amount due and owing to the United States of America by the District on the Bonds; 5. on September 2 of each year after making the deposits and transfers required under paragraphs 1 through 4 above, upon receipt of written instructions from an Authorized Officer, to the District for deposit in the Administrative Expense Fund the amount specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or the establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund and not included in any prior transfer made pursuant to paragraph I and 4 above; and 6.. after September 2 of each year, after making the deposits and transfers made pursuant to paragraphs 1 through 5 above, moneys then on deposit in the Special Tax Fund shall remain therein and shall be subsequently deposited or transferred pursuant to the provisions of paragraphs 1 through 5 above. C. Transfer of Prepay ments. Amounts constituting Prepayments shall be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Bond Fund designated as "Prepayment Account" and used to redeem Bonds pursuant to paragraph 2 of Section 2.03B. Any such transfer of Prepayments shall be accompanied by written instructions executed by the Treasurer or an Authorized Officer directing the Fiscal Agent to place such Prepayments in the Prepayment Account. D. Penalties and Interest. Amounts constituting Penalties and Interest shall be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Special Tax Fund designated as "Penalties and Interest Account." The moneys on deposit in the Penalties and Interest Account shall be held and subsequently transferred, upon receipt of written instructions contained in an Officer's Certificate, to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: I. to the Administrative Expense Fund that amount as specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund not included in any prior transfer made pursuant to paragraphs 3 or 6 of subsection B above; 60285.00019\7762768A 20 P746 2. to the Bond Fund that amount as specified in such Officer's Certificate for the payment of debt service on the Bonds; 3. to the Reserve Fund that amount as specified in such Officer's Certificate as necessary to increase the balance therein up to the Reserve Requirement; or 4. to such other fund or account as specified in such Officer's Certificate for any authorized purpose of the District. E. Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof. Section 3.04. Costs of Issuance Fund. A. Establishment of Costs of Issuance Fund. There is hereby established, as a separate account to be held by the Fiscal Agent, the "Costs of Issuance Fund" to the credit of which a deposit shall be made as required by Section 3.02. Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection B of this Section for the payment or reimbursement of Costs of Issuance. B. Disbursement. Amounts in the Costs of Issuance Fund shall be disbursed to pay Costs of Issuance, as set forth in a requisition containing respective amounts to be paid to the designated payees, signed by an Authorized Officer and delivered to the Fiscal Agent on the Closing Date. The Fiscal Agent shall pay all Costs of Issuance upon receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee in such requisition, or upon receipt of an Officer's Certificate requesting payment of a Cost of Issuance not listed on the initial requisition delivered to the Fiscal Agent on the Closing Date. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of ninety (90) days from the Closing Date and shall then transfer and deposit any moneys remaining therein, including any Investment Earnings thereon, to the Special Tax Fund. C. Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01 hereof. Investment Earnings shall be retained by the Fiscal Agent in the Cost of Issuance Fund to be used for the purposes of such fund. Section 3.05. Administrative Expense Fund. A. Establishment of Administrative Expense Fund. There is hereby established, as a separate account to be held by the District, the "Administrative Expense Fund" to the credit of which transfers from the Fiscal Agent shall be made to the District as required by Sections 3.02D, 3.03B or 3.03D hereof. Moneys in the Administrative Expense Fund shall be held in trust by the District for the benefit of the City and the District, and shall be disbursed as provided below. 60285.00019\7762768.4 21 P747 B. Disbursement. Amounts in the Administrative Expense Fund shall be withdrawn by the District and paid to the payee specified in an Officer's Certificate stating the amount to be withdrawn, that such amount is to be used to pay an Administrative Expense and the nature of such expense. Amounts on deposit in the Administrative Expense Fund at the end of any Fiscal Year shall be retained in such fund as an operating reserve and shall be disbursed as provided for in this paragraph B. C. Investment. Moneys in the Administrative Expense Fund shall be invested and deposited in accordance with Section 6.01 hereof. Investment Earnings shall be retained by the District in the Administrative Expense Fund to be used for the purposes of such fund. ARTICLE IV NET SPECIAL TAX REVENUES; BOND FUND Section 4.01. Pledge of Net Special Tax Revenues. The Bonds shall be secured by a first pledge (which pledge shall be effected in the manner and to the extent herein provided) of all of the Net Special Tax Revenues and all moneys deposited in the Bond Fund and, until disbursed as provided herein, in the Special Tax Fund, except for moneys on deposit in the the Penalties and Interest Account. The Bonds are further secured by a first pledge of all moneys deposited in the Reserve Fund. The Net Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided herein) are hereby dedicated to the payment of the principal of, and interest and any premium on, the Bonds as provided herein and in the Act until all of the Bonds have been paid and retired or until moneys or Defeasance Obligations have been set aside irrevocably for that purpose in accordance with Section 10.01. Section 4.02. Bond Fund. A. Establishment of Bond Fund. There is hereby established as a separate fund to be held by the Fiscal Agent for the "Bond Fund" and, within the Bond Fund, the "Prepayment Account" to the credit of which deposits shall be made as required by paragraph 2 of Section 3.03B. and by Section 3.03C., and any other amounts required to be deposited therein by this Agreement or the Act. Moneys in the Bond Fund shall be held by the Fiscal Agent for the benefit of the Owners of the Bonds, shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds. B. Disbursements. On each Interest Payment Date, the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal of, and interest and any premium, then due and payable on the Bonds, including any amounts due under Section 2.03A. hereof; provided, however, that available amounts in the Bond Fund shall first be used to pay to the Owners of the Bonds any past due installments of interest, principal (including mandatory sinking payments) of and premium, if any, on the Bonds, in that order. Amounts transferred to the Bond Fund from the Special Tax Fund pursuant to paragraph 2.a. of Section 3.03B. shall immediately be paid to the Owners of the Bonds in respect of past due payments on the Bonds, and amounts transferred to the Prepayment Account pursuant to Section 3.03C. shall be used to redeem Bonds pursuant to Section 2.03B. 60285.00019\7762768.4 22 P748 If after the foregoing transfers, there are insufficient funds in the Bond Fund to make the payments provided for in the first sentence of this Section 4.02B., the Fiscal Agent shall apply the available funds first to the payment of interest on the Bonds, then to the payment of principal and any mandatory sinking payments due on the Bonds. Any installment of principal (including mandatory sinking payments), premium, if any, or interest on the Bonds which is not paid when due shall accrue interest at the rate of interest on the Bonds until paid, and shall be paid whenever funds in the Bond Fund are sufficient therefor. If at any time the Fiscal Agent fails to pay principal and interest due on any scheduled payment date for the Bonds, the Fiscal Agent shall notify the District and the Treasurer in writing of such failure, and the Treasurer shall notify the California Debt Advisory Commission of such failure within 10 days of the failure to make such payment, as required by Section 53359(c)(1) of the Act. C. Investment. Moneys in the Bond Fund shall be invested and deposited in accordance with Section 6.01. Investment Earnings shall be retained in the Bond Fund, except to the extent they are required to be deposited by the Fiscal Agent in the Rebate Fund in accordance with Section 6.02 hereof. Interest earnings and profits resulting from the investment and deposit of amounts in the Bond Fund shall be retained in the Bond Fund. Section 4.03. Reserve Fund. A. Establishment of Reserve Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the "Reserve Fund," to the credit of which a deposit shall be made as required by Section 3,02B. hereof. Moneys in the Reserve Fund shall be held by the Fiscal Agent for the benefit of the Bondowners and shall be disbursed as provided in Section 4.03B below. B. Procedure for Disbursement. Moneys on deposit in the Reserve Fund shall be used solely for the purpose of paying the principal of and interest on the Bonds as such amounts shall become due and payable in the event that the moneys in the Special Tax Fund and the Bond Fund for such purpose are insufficient therefor or redeeming Bonds as described below. The Fiscal Agent shall, when and to the extent necessary, withdraw money from the Reserve Fund and transfer such money to the Bond Fund or the Redemption Fund for such purpose. On any date after either the transfers, if any, required by the preceding paragraph have been made for any Bond Year or the valuation of the Permitted Investments in the Reserve Fund pursuant to Section 6.01 below, if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, the Fiscal Agent shall transfer to the Reserve Fund from the first available moneys in the Special Tax Fund an amount necessary to increase the balance therein to the Reserve Requirement. If at least ten (10) Business Days prior to each Interest Payment Date of each year, the amount on deposit in the Reserve Fund, less Investment Earnings resulting from the investment of the funds therein which pursuant to Section 6.02 hereof must be rebated to the United States, is in excess of the Reserve Requirement, the Fiscal Agent shall transfer such excess to the Bond Fund. In connection with any optional redemption of Bonds pursuant to Section 2.03A., amounts on deposit in the Reserve Fund which would be in excess of the Reserve Requirement following such redemption shall be transferred to the Redemption Fund or 60285.00019\7762768.4 23 P749 the Bond Fund, as applicable, prior to such redemption and applied to such redemption of Bonds pursuant to written instructions of the District contained in an Officer's Correspondence. Upon receipt of an Officer's Correspondence instructing the Fiscal Agent to transfer certain moneys representing a Reserve Fund credit for a Prepayment pursuant to the RMA , the Fiscal Agent shall transfer the amount specified in such instructions from the Reserve Fund to the Redemption Fund for the purpose of redeeming Bonds pursuant to such instructions. Whenever the balance in the Reserve Fund and the Bond Fund exceeds the amount required to redeem or pay the Outstanding Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent shall transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding interest payment date, to the payment and redemption, in accordance with Section 2.03A of all of the Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund shall be transferred to the District to be used for any lawful purpose of the District as set forth in the Act. C. Investment. Moneys in the Reserve Fund shall be invested and deposited by the Fiscal Agent in accordance with Section 6.01 hereof. Interest earnings and profits from such investment and deposit shall be retained in the Reserve Fund to be used for the purposes of such fund. All Authorized Investments in the Reserve Fund shall be valued at their cost at least semi- annually on February 1 and August 1 so long as at lease 25% of the moneys in the Reserve Fund are invested for a period not to exceed two (2) years in length. ARTICLE V OTHER COVENANTS OF THE DISTRICT Section 5.01. Warranty. The District shall preserve and protect the security pledged hereunder to the Bonds against all claims and demands of all persons. Section 5.02. Covenants. So long as any of the Bonds issued hereunder are Outstanding and unpaid, the District makes the covenants set forth herein below in this Article V with the Bondowners under the provisions of the Act and this Fiscal Agent Agreement (to be performed by the District or the City, acting for and on behalf of the District, or its proper officers, agents and employees), which are covenants necessary and desirable to secure the Bonds and tend to make the Bonds more marketable; provided, however, that such covenants do not require the District to expend any funds or moneys other than the Net Special Tax Revenues. Section 5.03. Punctual Payment. The District shall punctually pay or cause to be paid the principal of, and interest and any premium on, the Bonds when and as due in strict conformity with the terms of this Agreement and any Supplemental Agreement, and it will faithfully observe and perform all of the conditions, covenants and requirements of this Agreement and all Supplemental Agreements and of the Bonds. 60285.00019\7762768.4 24 P750 Section 5.04. Limited Obligation. The Bonds are limited obligations of the District and are payable solely from and secured solely by the Net Special Tax Revenues and the amounts in the Bond Fund and the Special Tax Fund created hereunder. Section 5.05. Payment of Claims. The District will pay and discharge any and all lawful claims for labor, materials, or supplies which, if unpaid, might become a lien or charge upon the Special Tax Revenues or which might otherwise impair the security of the Bonds then Outstanding; provided that nothing herein contained shall require the District to make any such payments so long as the District in good faith shall contest the validity of any such claims. Section 5.06. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the District shall not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and shall not, directly or indirectly, be a party to the approval of any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the District, such claim for interest so extended or funded shall not be entitled, in case of default hereunder, to the benefits of this Agreement, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have so extended or funded. Section 5.07. Against Encumbrances. The District will not encumber, pledge or place any charge or lien upon any of the Net Special Tax Revenues or other amounts pledged to the Bonds superior to or on a parity with the pledge and lien herein created for the benefit of the Bonds, except as permitted by this Agreement. Section 5.08. Books and Records. The District will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the District, in which complete and correct entries shall be made of all transactions relating to the expenditure of amounts disbursed from the Bond Fund and the Special Tax Fund and relating to the Special Tax Revenues. Section 5.09. Protection of Security and Rights of Owners. The District will preserve and protect the security of the Bonds and the rights of the Owners, and will warrant and defend their rights against all claims and demands of all persons. From and after the delivery of any of the Bonds by the District, the Bonds shall be incontestable by the District. Section 5.10. Collection of Special Tax Revenues. The District shall comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including without limitation, the enforcement of delinquent Special Taxes. On or about July 10 of each year, the Treasurer shall communicate with the Auditor to ascertain the relevant parcels on which the Special Taxes are to be levied, taking into account any parcel splits during the preceding and then current year. 60285.00019\7762768.4 25 P751 The Treasurer shall effect the levy of the Special Taxes each Fiscal Year on the parcels within Improvement Area No. 2 of the District in accordance with the Ordinance, such that the computation of the levy is complete before the final date on which the Auditor will accept the transmission of the Special Tax amounts for the parcels within Improvement Area No. 2 of the District for inclusion on the next secured tax roll. Upon the completion of the computation of the amounts of the levy, the Treasurer shall prepare or cause to be prepared, and shall transmit to the Auditor, such data as the Auditor requires to include the levy of the Special Taxes on the next secured tax roll. The Special Taxes so levied shall be payable and be collected in the same manner and at the same time and in the same installments as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the general taxes on real property, unless otherwise provided by the District. In the event that the Treasurer determines to levy all or a portion of the Special Taxes by means of direct billing of the property owners of the parcels within Improvement Area No. 2 of the District, the Treasurer shall, not less than forty-five (45) days prior to each Interest Payment Date, send bills to the owners of such real property located within Improvement Area No. 2 of the District subject to the levy of the Special Taxes for Special Taxes in an aggregate amount necessary to meet the financial obligations of the District with respect to Improvement Area No. 2 due on the next Interest Payment Date, said bills to specify that the amounts so levied shall be due and payable not less than thirty (30) days prior to such Interest Payment Date and shall be delinquent if not paid when due. In any event, the Treasurer shall fix and levy the amount of Special Taxes within Improvement Area No. 2 of the District required for the payment of principal of and interest on any Outstanding Bonds becoming due and payable during the ensuing year, an amount necessary to replenish the Reserve Fund pursuant to Section 3.03B.3. and an amount estimated to be sufficient to pay the Administrative Expenses during such year, all in accordance with the RMA and the Ordinance. The Special Taxes so levied shall not exceed the authorized amounts as provided in the proceedings pursuant to the Resolution of Formation. The Treasurer is hereby authorized to employ consultants to assist in computing the levy of the Special Taxes hereunder and any reconciliation of amounts levied to amounts received. The fees and expenses of such consultants and the costs and expenses of the Treasurer (including a charge for City or District staff time) in conducting its duties hereunder shall be an Administrative Expense hereunder. Section 5.11. Further Assurances. The District shall adopt, make, execute and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement. Section 5.12. Tax Covenants. The District covenants that: 60285.00019\7762768.4 26 P752 A. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of the initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "arbitrage bonds" within the meaning of Section 103(b) and Section 148 of the Code; B. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would result in loss of exclusion from gross income for purposes of federal income taxation under Section 103(a) of the Code of interest paid with respect to the Bonds; C. It will not take any action or omit to take any action, which action or omission, if reasonably expected on the date of initial issuance and delivery of the Bonds, would have caused any of the Bonds to be "private activity bonds" within the meaning of Section 141 of the Code; D. It will comply with the Rebate Certificate as a source of guidance for achieving compliance with the Code; and E. In order to maintain the exclusion from gross income for purposes of federal income taxation of interest paid with respect to the Bonds, it will comply with each applicable requirement of Section 103 and Sections 141 through 150 of the Code. The covenants of the District contained in this Section 5.12 shall survive the payment, redemption or defeasance of Bonds pursuant to Section 10.01 hereof. Section 5.13. Covenant to Foreclose. On or before March 1 and June 1 of each Fiscal year, the District will review the public records of the County in connection with the Special Taxes levied in such Fiscal Year to determine the amount of Special Taxes actually collected in such Fiscal Year. If the District determines that any parcel subject to the Special Taxes is delinquent in the payment of two or more installments of Special Taxes, the City shall, not later than forty-five (45) days of such determination, send or cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner. The City shall cause judicial foreclosure proceedings to be commenced and filed in the Superior Court not later than ninety (90) days of such determination against any parcel for which a notice of delinquency was given pursuant to this section and for which the Special Taxes remain delinquent. The City Attorney is hereby authorized to employ counsel to conduct any such foreclosure proceedings. The fees and expenses of any such counsel and costs and expenses of the City Attorney (including a charge for City or District staff time) in conducting foreclosure proceedings shall be an Administrative Expense hereunder. Notwithstanding any provision of the Act or other law of the State to the contrary, in connection with any foreclosure related to delinquent Special Taxes: 60285.00019\7762768A 27 P753 A. The City, or the Fiscal Agent, is hereby expressly authorized to credit bid at any foreclosure sale, without any requirement that funds be placed in the Bond Fund or otherwise be set aside in the amount of such credit bid, in the amount specified in Section 53356.5 of the Act or such lesser amount as determined under B. below or otherwise under Section 53356.6 of the Act. B. The City may permit property with delinquent Special Tax payments to be sold for less than the amount specified in Section 53356.5 of the Act, if it determines that such sale is in the interest of the Bond Owners. The Bond Owners, by their acceptance of the Bonds, hereby consent to such sale for such lesser amounts (as such consent is described in Section 53356.6 of the Act), and hereby release the City, its officers and its agents from any liability in connection therewith. C. The City is hereby expressly authorized to use amounts in the Administrative Expense Fund to pay costs of foreclosure of delinquent Special Taxes. D. The City may forgive all or any portion of the Special Taxes levied or to be levied on any parcel in the District, so long as the City determines that such forgiveness is not expected to adversely affect its obligation to pay principal of and interest on the Bonds. Section 5.14. Annual Reports to CDIAC. Not later than October 30 of each year, commencing October 30, 2013, and until the October 30 following the final maturity of the Bonds, the Treasurer shall supply the information required by Section 53359.5(b) or (c) of the Act to CDIAC (on such forms as CDIAC may specify) and the District. Section 5.15. Continuing Disclosure to Owners. The District acknowledges that the City has executed and delivered a Continuing Disclosure Certificate, for and on behalf of the the District, for the benefit of the holders and beneficial owners of the Bonds and in order to assist the Underwriter in complying with Rule 15c2-12(b)(5) of the Securities and Exchange Commission. The District hereby covenants and agrees that it will cause all of its obligations under the Continuing Disclosure Certificate to be carried out. Notwithstanding any other provision of this Agreement, failure of the District to comply with the Continuing Disclosure Agreement shall not be considered a default hereunder; however, the Underwriter or any holder or beneficial owner of 25% of the Bonds may take such actions as may be necessary and appropriate to compel performance by the District of its obligations under this Section 5.15, including seeking mandate or specific performance by court order. Section 5.16. Public Access to Facilities. The City and the District shall provide or cause to be provided access to members of the general public to all portions of the Project financed with the proceeds of the Prior Special Tax Bonds. Said access shall not grant priority to any one person over that of another person. Section 5.17. Modification of Maximum Authorized Special Tax. The District, to the maximum extent that the law permits it to do so, covenants that no modification of the minimum or maximum authorized Special Tax shall be approved by the District nor shall the District take any other action which would (i) prohibit the District from levying the Special Tax within Improvement Area No. 2 of the District in any Fiscal Year at such a rate as would generate Net 60285.00019\7762768.4 28 P754 Special Tax Revenues in such Fiscal Year at least equal to 110% of Annual Debt Service on all Bonds then Outstanding; (ii) discontinue or cause the discontinuance of such levy; or (iii) permit the prepayment of the Special Tax except as permitted pursuant to the the RMA. Section 5.18. Covenant to Defend. The District covenants, in the event that any initiative is adopted by the qualified electors in the District which purports to reduce the minimum or the maximum Special Tax below the levels specified in Section 5.17 above or to limit the power of the District to levy the Special Taxes within Improvement Area No. 2 of the District for the purposes set forth in Section 5.10 above, it will commence and pursue legal action in order to preserve its ability to comply with such covenants. ARTICLE VI INVESTMENTS; DISPOSITION OF INVESTMENT PROCEEDS; LIABILITY OF THE DISTRICT Section 6.01. Deposit and Investment of Moneys in Funds. Moneys in any fund or account created or established by this Agreement and held by the Fiscal Agent shall be invested by the Fiscal Agent in Permitted Investments, as directed pursuant to an Officer's Certificate filed with the Fiscal Agent at least two (2) Business Days in advance of the making of such investments. In the absence of any such Officer's Certificate, the Fiscal Agent shall invest any such moneys in Permitted Investments described in clause B(5) of the definition thereof to the extent practicable which by their terms mature prior to the date on which such moneys are required to be paid out hereunder, or are held uninvested. The Treasurer shall make note of any investment of funds hereunder in excess of the yield on the Bonds, so that appropriate actions can be taken to assure compliance with Section 5.10. Moneys in any fund or account created or established by this Agreement and held by the Treasurer shall be invested by the Treasurer in Permitted Investments, which in any event by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an investment of moneys in any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of interest earnings and profits resulting from investment of amounts in funds and accounts. Whenever in this Agreement any moneys are required to be transferred by the District to the Fiscal Agent, such transfer may be accomplished by transferring a like amount of Permitted Investments. The Fiscal Agent or an affiliate or the Treasurer may act as principal or agent in the acquisition or disposition of any investment and shall be entitled to its customary fee therefor. Neither the Fiscal Agent nor the Treasurer shall incur any liability for losses arising from any investments made pursuant to this Section. For purposes of determining the amount on deposit in any fund or account held hereunder, all Permitted Investments or investments credited to such fund or account shall be valued at provided for in Exhibit B attached hereto. 60285.00019\7762768.4 29 P755 Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of section 148 of the Code) shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under the applicable provisions of the Code shall be valued at their present value (within the meaning of section 148 of the Code). The Fiscal Agent shall not be liable for verification of the application of such sections of the Code. Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of investments, notwithstanding provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amounts received or held by the Fiscal Agent or the Treasurer hereunder, provided that the Fiscal Agent or the Treasurer, as applicable, shall at all times account for such investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement. The Fiscal Agent or the Treasurer, as applicable, shall sell at the highest price reasonably obtainable, or present for redemption, any investment security whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such investment security is credited and neither the Fiscal Agent nor the Treasurer shall be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith. Section 6.02. Rebate Fund; Rebate to the United States. There is hereby created, to be held by the Fiscal Agent, as a separate fund distinct from all other funds and accounts held by the Fiscal Agent under this Agreement, the Rebate Fund. The Fiscal Agent shall, in accordance with written directions received from an Authorized Officer, deposit into the Rebate Fund moneys transferred by the District to the Fiscal Agent pursuant to the Rebate Certificate or moneys transferred by the Fiscal Agent from the Bond Fund or the Reserve Fund. The Rebate Fund shall be held either uninvested or invested only in Federal Securities at the written direction of the District. Moneys on deposit in the Rebate Fund shall be applied only to payments made to the United States, to the extent such payments are required by the Rebate Certificate. The Fiscal Agent shall, upon written request and direction of the District, make such payments to the United States. The Fiscal Agent's sole responsibilities under this Section 6.02 are to follow the written instructions of the District pertaining hereto. The District shall be responsible for any fees and expenses incurred by the Fiscal Agent pursuant to this Section 6.02. The Fiscal Agent shall, upon written request and direction from the District, transfer to or upon the order of the District any moneys on deposit in the Rebate Fund in excess of the amount, if any, required to be maintained or held therein in accordance with the Rebate Certificate. Section 6.03. Limited Obligation. The District's obligations hereunder are limited obligations of the District and are payable solely from and secured solely by the Net Special Tax Revenues and the amounts in the Special Tax Fund and the Bond Fund. 60285.0001%7762768.4 30 P756 Section 6.04. Liability of District. The District shall not incur any responsibility in respect of the Bonds or this Agreement other than in connection with the duties or obligations explicitly herein or in the Bonds assigned to or imposed upon it. The District shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The District shall not be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions, covenants, or agreements of the Fiscal Agent herein or of any of the documents executed by the Fiscal Agent in connection with the Bonds, or as to the existence of a default or event of default thereunder. In the absence of bad faith, the District, including the Treasurer, may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the District and conforming to the requirements of this Agreement. The District, including the Treasurer, shall not be liable for any error of judgment made in good faith unless it shall be proved that it was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the District to expend or risk its own general funds or otherwise incur any financial liability (other than with respect to the Net Special Tax Revenues) in the performance of any of its obligations hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. The District may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper parry or proper parties. The District may consult with counsel, who may be the City Attorney, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The District shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed. Whenever in the administration of its duties under this Agreement the District shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the District, be deemed to be conclusively proved and established by a certificate of the Fiscal Agent, and such certificate shall be full warrant to the District for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the District may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. 60285.00019\7762768.4 31 P757 Section 6.05. Employment of Agents by District or the City. In order to perform their respective duties and obligations hereunder, the City, the District and/or the Treasurer may employ such persons or entities as they deem necessary or advisable. The City, the District, and/or the Treasurer shall not be liable for any of the acts or omissions of such persons or entities employed by them in good faith hereunder, and shall be entitled to rely, and shall be fully protected in doing so, upon the opinions, calculations, determinations and directions of such persons or entities. ARTICLE VII EVENTS OF DEFAULT AND REMEDIES OF BOND OWNERS Section 7.01. Events of Default. The following events shall be Events of Default: A. Failure to pay any installment of principal of any Bonds when and as the same shall become due and payable, whether at maturity as therein expressed, by proceedings for redemption or otherwise. B. Failure to pay any installment of interest on any Bonds when and as the same shall become due and payable. C. Failure by the District to observe and perform any of the other covenants, agreements, or conditions on its part in this Agreement or in the Bonds contained, if such failure shall have continued for a period of 60 days after written notice thereof, specifying such failure and requiring the same to be remedied, shall have been given to the District by the Fiscal Agent or the Owners of not less than 25% in aggregate principal amount of the Bonds at the time Outstanding; provided, however, if in the reasonable opinion of the District the failure stated in the notice can be corrected, but not within such 60-day period, such failure shall not constitute an Event of Default if corrective action is instituted by the District within such 60-day period and the District shall thereafter diligently and in good faith cure such failure in a reasonable period of time. D. Commencement by the District of a voluntary case under Title 11 of the United States Code or any substitute or successor statute. Section 7.02. Remedies of Bond Owners. Subject to the provisions of Section 7.07, any Bond Owner shall have the right, for the equal benefit and protection of all Bond Owners similarly situated: A. by mandamus, suit, action or proceeding, to compel the City and its officers, agents or employees to perform each and every term, provision and covenant contained in this Agreement and in the Bonds, and to require the carrying out of any or all such covenants and agreements of the City and the fulfillment of all duties imposed upon it by the Act; B. by suit, action or proceeding in equity, to enjoin any acts or things which are unlawful, or the violation of any of the Bond Owners' rights; or 60285.00019\7762768.4 32 P758 C. upon the happening of any Event of Default, by suit, action or proceeding in any court of competent jurisdiction, to require the City and its officers and employees to account as if it and they were the trustees of an express trust. Section 7.03. Application of Special Taxes and Other Funds After Default. If an Event of Default shall occur and be continuing, all Special Taxes, including any penalties, costs, fees and other charges accruing under the Act, and any other funds then held or thereafter received by the Fiscal Agent under any of the provisions of this Agreement shall be applied by the Fiscal Agent as follows and in the following order: A. To the payment of any expenses necessary in the opinion of the Fiscal Agent to protect the interests of the Owners of the Bonds and payment of reasonable fees, charges, and expenses of the Fiscal Agent (including reasonable fees and disbursements of its counsel) incurred in and about the performance of its powers and duties under this Agreement; B. To the payment of the principal of and interest then due with respect to the Bonds (upon presentation of the Bonds to be paid, and stamping thereon of the payment if only partially paid, or surrender thereof if fully paid) subject to the provisions of this Agreement, as follows: First: To the payment to the Persons entitled thereto of all installments of interest then due in the order of the maturity of such installments, and, if the amount available shall not be sufficient to pay in full any installment or installments maturing on the same date, then to the payment thereof ratably, according to the amounts due thereon, to the Persons entitled thereto, without any discrimination or preference; and Second: To the payment to the Persons entitled thereto of the unpaid principal of any Bonds which shall have become due, whether at maturity or by call for redemption, with interest on the overdue principal at the rate borne by the respective Bonds on the date of maturity or redemption, and, if the amount available shall not be sufficient to pay in full all the Bonds, together with such interest, then to the payment thereof ratably, according to the amounts of principal due on such date to the Persons entitled thereto, without any discrimination or preference. C. Any remaining funds shall be transferred by the Fiscal Agent to the Bond Fund. Section 7.04. Absolute Obligation of the District. Nothing in Section 7.08 or in any other provision of this Agreement or in the Bonds contained shall affect or impair the obligation of the District, which is absolute and unconditional, to pay the principal of and interest on the Bonds to the respective Owners of the Bonds at their respective dates of maturity, or upon call for redemption, as herein provided, but only out of the Net Special Tax Revenues and other moneys herein pledged therefor and received by the District or the Fiscal Agent, or affect or impair the right of such Owners, which is also absolute and unconditional, to enforce such payment by virtue of the contract embodied in the Bonds. 60285.00019\7762768.4 33 P759 Section 7.05. Termination of Proceedings. In case any proceedings taken by any one or more Bond Owners on account of any Event of Default shall have been discontinued or abandoned for any reason or shall have been determined adversely to the Bond Owners, then in every such case the District, and the Bond Owners, subject to any determination in such proceedings, shall be restored to their former positions and rights hereunder, severally and respectively, and all rights, remedies, powers and duties of the City, and the Bond Owners shall continue as though no such proceedings had been taken. Section 7.06. Remedies Not Exclusive. No remedy herein conferred upon or reserved to the Fiscal Agent or to the Owners of the Bonds is intended to be exclusive of any other remedy or remedies, and each and every such remedy, to the extent permitted by law, shall be cumulative and in addition to any other remedy given hereunder or now or hereafter existing at law or in equity or otherwise. Section 7.07. No Waiver of Default. No delay or omission of any Owner of the Bonds to exercise any right or power arising upon the occurrence of any default shall impair any such right or power or shall be construed to be a waiver of any such default or an acquiescence therein; and every power and remedy given by this Agreement to the Owners of the Bonds may be exercised from time to time and as often as may be deemed expedient. ARTICLE VIII THE FISCAL AGENT Section 8.01. Appointment of Fiscal Agent. Wells Fargo Bank, National Association, is hereby appointed Fiscal Agent and paying agent for the Bonds. The Fiscal Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Fiscal Agent. Any company into which the Fiscal Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Fiscal Agent may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under the following paragraph of this Section, shall be the successor to such Fiscal Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding. The District may remove the Fiscal Agent initially appointed, and any successor thereto, and may appoint a successor or successors thereto, but any such successor shall be a bank or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least Seventy-Five Million Dollars ($75,000,000), and subject to supervision or examination by federal or state authority. If such bank or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 8.01, combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. 6028 5.000J%7762768 4 34 P760 The Fiscal Agent may at any time resign by giving written notice to the District and by giving to the Owners notice by mail of such resignation. Upon receiving notice of such resignation, the District shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent shall become effective upon acceptance of appointment by the successor Fiscal Agent. If no appointment of a successor Fiscal Agent shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Fiscal Agent shall have given to the District written notice or after a vacancy in the office of the Fiscal Agent shall have occurred by reason of its inability to act, the Fiscal Agent or any Bondowner may apply to any court of competent jurisdiction to appoint a successor Fiscal Agent. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Fiscal Agent. If, by reason of the judgment of any court, the Fiscal Agent is rendered unable to perform its duties hereunder, all such duties and all of the rights and powers of the Fiscal Agent hereunder shall be assumed by and vest in the Treasurer of the City in trust for the benefit of the Owners. The District covenants for the direct benefit of the Owners that the Treasurer in such case shall be vested with all of the rights and powers of the Fiscal Agent hereunder, and shall assume all of the responsibilities and perform all of the duties of the Fiscal Agent hereunder, in trust for the benefit of the Owners of the Bonds. Section 8.02. Liability of Fiscal Agent. The recitals of facts, covenants, and agreements herein and in the Bonds contained shall be taken as statements, covenants, and agreements of the District, and the Fiscal Agent assumes no responsibility for the correctness of the same, nor makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, nor shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The Fiscal Agent assumes no responsibility or liability for any information, statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement. Except as provided above in this paragraph, the Fiscal Agent shall be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument. 60285.00019\7762768.4 35 P761 The Fiscal Agent shall not be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions, covenants, or agreements of the City or the District herein or of any of the documents executed by the City or the District in connection with the Bonds, or as to the existence of a default or event of default thereunder. The Fiscal Agent shall not be liable for any error of judgment made in good faith by a responsible officer unless it shall be proved that the Fiscal Agent was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the Fiscal Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement at the request or direction of any of the Owners pursuant to this Agreement unless such Owners shall have offered to the Fiscal Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction. The Fiscal Agent may become the Owner of the Bonds with the same rights it would have if it were not the Fiscal Agent. All indemnifications and releases from liability granted to the Fiscal Agent hereunder shall extend to the directors, officers, and employees of the Fiscal Agent. Section 8.03. Information. The Fiscal Agent shall provide to the District such information relating to the Bonds and the funds and accounts maintained by the Fiscal Agent hereunder as the District shall reasonably request, including, but not limited to, quarterly statements reporting funds held and transactions by the Fiscal Agent. Section 8.04. Notice to Fiscal Agent. The Fiscal Agent may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, Bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties. The Fiscal Agent may consult with counsel; who may be counsel to the City, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The Fiscal Agent shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed. 60285.00019\7762768.4 36 P762 Whenever in the administration of its duties under this Agreement the Fiscal Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Fiscal Agent, be deemed to be conclusively proved and established by a certificate of the District, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may deem reasonable. Section 8.05. Compensation, Indemnification. The District shall pay to the Fiscal Agent from time to time reasonable compensation for all services rendered as Fiscal Agent under this Agreement, and also all reasonable expenses, charges, counsel fees, and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The District further agrees, to the extent permitted by applicable law, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any liabilities which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or willful misconduct. The obligation of the District under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement, but any monetary obligation of the District arising under this Section shall be limited solely to amounts on deposit in the Local Refunding Obligation Administrative Expense Fund. ARTICLE IX MODIFICATION OR AMENDMENT OF THIS AGREEMENT Section 9.01. Amendments Permitted. This Agreement and the rights and obligations of the District and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Agreement pursuant to the affirmative vote at a meeting of the Owners, or with the written consent without a meeting, of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 9.04. No such modification or amendment shall (i) extend the maturity of any Bond or reduce the interest rate thereon, or otherwise alter or impair the obligation of the District to pay the principal of, and the interest and any premium on, any Bond, without the express consent of the Owner of such Bond; or (ii) permit the creation by the District of any pledge or lien upon the Special Taxes superior to or on a parity with the pledge and lien created for the benefit of the Bonds (except as otherwise permitted by the Act, the laws of the State of California or this Agreement), or reduce the percentage of Bonds required for the amendment hereof. Any such amendment may not modify any of the rights or obligations of the Fiscal Agent without its written consent. 60285.00019\7762768.4 37 P763 This Agreement and the rights and obligations of the District and of the Owners may also be modified or amended at any time by a Supplemental Agreement, without the consent of any Owners, only to the extent permitted by law and only for any one or more of the following purposes: (i) to add to the covenants and agreements of the District in this Agreement contained, other covenants and agreements thereafter to be observed, or to limit or surrender any right or power herein reserved to or conferred upon the District; (ii) to make modifications not adversely affecting any Outstanding Bonds of the District in any material respect; (iii) to make such.provisions for the purpose of curing any ambiguity, or of curing, correcting, or supplementing any defective provision contained in this Agreement, or in regard to questions arising under this Agreement, as the District and the Fiscal Agent may deem necessary or desirable and not inconsistent with this Agreement, and which shall not adversely affect the rights of the Owners of the Bonds; (iv) to make such additions, deletions, or modifications as may be necessary or desirable to assure the exclusion from gross income for federal income tax purposes of interest on the Bonds. Section 9.02. Owners' Meetings. The District may at any time call a meeting of the Owners. In such event the District is authorized to fix the time and place of said meeting and to provide for the giving of notice thereof, and to fix and adopt rules and regulations for the conduct of said meeting. Section 9.03. Procedure for Amendment with Written Consent of Owners. The District and the Fiscal Agent may at any time adopt a Supplemental Agreement amending the provisions of the Bonds or of this Agreement or any Supplemental Agreement, to the extent that such amendment is permitted by Section 9.01, to take effect when and as provided in this Section. A copy of such Supplemental Agreement, together with a request to Owners for their consent thereto, shall be mailed by first class mail, by the Fiscal Agent to each Owner of Bonds Outstanding, but failure to mail copies of such Supplemental Agreement and request shall not affect the validity of the Supplemental Agreement when assented to as in this Section provided. Such Supplemental Agreement shall not become effective unless there shall be filed with the Fiscal Agent the written consent of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding (exclusive of Bonds disqualified as provided in Section 9.04 and a notice shall have been mailed as hereinafter in this Section provided. Each such consent shall be effective only if accompanied by proof of ownership of the Bonds for which such consent is given, which proof shall be such as is permitted by Section 11.04. Any such consent shall be binding upon the Owner of the Bonds giving such consent and on any subsequent Owner (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Fiscal Agent prior to the date when the notice hereinafter in this Section provided for has been mailed. 60285.00019\7762768.4 38 P764 After the Owners of the required percentage of Bonds shall have filed their consents to the Supplemental Agreement, the District shall mail a notice to the Owners in the manner hereinbefore provided in this Section for the mailing of the Supplemental Agreement, stating in substance that the Supplemental Agreement has been consented to by the Owners of the required percentage of Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of the Supplemental Agreement or consents thereto). Proof of the mailing of such notice shall be filed with the Fiscal Agent. A record, consisting of the papers required by this Section 9.03 to be filed with the Fiscal Agent, shall be proof of the matters therein stated until the contrary is proved. The Supplemental Agreement shall become effective upon the filing with the Fiscal Agent of the proof of mailing of such notice, and the Supplemental Agreement shall be deemed conclusively binding (except as otherwise hereinabove specifically provided in this Article) upon the District and the Owners of all Bonds at the expiration of sixty (60) days after such filing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such sixty-day period. Section 9.04. Disqualified Bonds. Bonds owned or held for the account of the City or the District, excepting any pension or retirement fund, shall not be deemed Outstanding for the purpose of any vote, consent or other action or any calculation of Outstanding Bonds provided for in this Article IX, and shall not be entitled to vote upon, consent to, or take any other action provided for in this Article IX. Section 9.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article IX, this Agreement shall be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the District and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such Supplemental Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes. Section 9.06. Endorsement or Replacement of Bonds Issued After Amendments. The District may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article IX shall bear a notation, by endorsement or otherwise, in form approved by the District, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the District may select and designate for that purpose, a suitable notation shall be made on such Bond. The District may determine that new Bonds, so modified as in the opinion of the District is necessary to conform to such Owners' action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds. Section 9.07. Amendatory Endorsement of Bonds. The provisions of this Article IX shall not prevent any Owner from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds. 60285.00019\7762768.4 39 P765 ARTICLE X DEFEASANCE Section 10.01. Defeasance. If the District shall pay or cause to be paid, or there shall otherwise be paid, to the Owner of an Outstanding Bond the interest due thereon and the principal thereof, at the times and in the manner stipulated in this Agreement, then the Owner of such Bond shall cease to be entitled to the pledge of Net Special Tax Revenues, and, other than as set forth below, all covenants, agreements and other obligations of the District to the Owner of such Bond under this Agreement shall thereupon cease, terminate and become void and be discharged and satisfied. In the event of a defeasance of all Outstanding Bonds pursuant to this Section, the Fiscal Agent shall execute and deliver to the District all such instruments as may be desirable to evidence such discharge and satisfaction, and the Fiscal Agent shall pay over or deliver to the District's general fund all money or securities held by it pursuant to this Agreement which are not required for the payment of the principal of, premium, if any, and interest due on such Bonds. Any Outstanding Bond shall be deemed to have been paid within the meaning expressed in the first paragraph of this Section if such Bond is paid in any one or more of the following ways: (i) by paying or causing to be paid the principal of, premium, if any, and interest on such Bond, as and when the same become due and payable; (ii) by depositing with the Fiscal Agent, in trust, at or before maturity, money which, together with the amounts then on deposit in the Special Tax Fund and available for such purpose, is fully sufficient to pay the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and payable; or (iii) by depositing with the Fiscal Agent or another escrow bank appointed by the District, in trust, direct, noncallable Defeasance Obligations, in which the District may lawfully invest its money, in such amount as an Independent Accountant shall determine will be sufficient, together with the interest to accrue thereon and moneys then on deposit in the Special Tax Fund and available for such purpose, together with the interest to accrue thereon, to pay and discharge the principal of, premium, if any, and interest on such Bond, as and when the same shall become due and payable; then, at the election of the District, and notwithstanding that any Outstanding Bonds shall not have been surrendered for payment, all obligations of the District under this Agreement with respect to such Bond shall cease and terminate, except for the obligation of the Fiscal Agent to pay or cause to be paid to the Owners of any such Bond not so surrendered and paid, all sums due thereon. Notice of such election shall be filed with the Fiscal Agent not less than ten (10) days prior to the proposed defeasance date, or such shorter period of time as may be acceptable to the Fiscal Agent. In connection with a defeasance under (ii) or (iii) above, there shall be provided to the District a verification report from an Independent Accountant stating its opinion as to the sufficiency of the moneys or securities deposited with the Fiscal Agent or the escrow bank to pay and discharge the principal of, premium, if any, and interest on all Outstanding 60285.00019\7762768.4 40 P766 Bonds to be defeased in accordance with this Section, as and when the same shall become due and payable, and an opinion of Bond Counsel (which may rely upon the opinion of the certified public accountant) to the effect that the Bonds being defeased have been legally defeased in accordance with this Agreement. Upon a defeasance, the Fiscal Agent, upon request of the District, shall release the rights of the Owners of such Bonds which have been defeased under this Agreement and execute and deliver to the District all such instruments as may be desirable. to evidence such release, discharge and satisfaction. In the case of a defeasance hereunder of all Outstanding Bonds, after payment of any amounts then owed to the Fiscal Agent, the Fiscal Agent shall pay over or deliver to the District any funds held by the Fiscal Agent at the time of a defeasance, which are not required for the purpose of paying and discharging the principal of or interest on the Bonds when due. The Fiscal Agent shall, at the written direction of the District, mail, first class, postage prepaid, a notice to the Bondowners whose Bonds have been defeased, in the form directed by the District, stating that the defeasance has occurred. ARTICLE XI MISCELLANEOUS Section 11.01. Benefits of Agreement Limited to Parties. Nothing in this Agreement, expressed or implied, is intended to give to any person other than the District, the City, the Fiscal Agent, and the Owners, any right, remedy, claim under or by reason of this Agreement. Any covenants, stipulations, promises, or agreements in this Agreement contained by and on behalf of the District shall be for the sole and exclusive benefit of the Owners and the Fiscal Agent. Section 11.02. Cancellation of Bonds. All Bonds surrendered to the Fiscal Agent for payment upon maturity or for redemption shall be upon payment therefor, and any Bond purchased by the District as authorized herein and delivered to the Fiscal Agent for such purpose shall be, cancelled forthwith and shall not be reissued. The Fiscal Agent shall destroy such Bonds, as provided by law, and, upon request of the District, furnish to the District a certificate of such destruction. Section 11.03. Successor is Deemed Included in All References to Predecessor. Whenever in this Agreement or any Supplemental Agreement either the District or the Fiscal Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Agreement contained by or on behalf of the District or the Fiscal Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not. Section 11.04. Execution of Documents and Proof of Ownership by Owners. Any request, declaration, or other instrument which this Agreement may require or permit to be executed by the Owners may be in one or more instruments of similar tenor, and shall be executed by the Owners in person or by their attorneys appointed in writing. 60285.00019\7762768.4 41 P767 Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such request, declaration or other instrument, or of such writing appointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declaration or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books. Any request, declaration or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the District or the Fiscal Agent in good faith and in accordance therewith. Section 11.05. Waiver of Personal Liability. No member, officer, agent or employee of the District or the City shall be individually or personally liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing herein contained shall relieve any such member, officer, agent or employee from the performance of any official duty provided by law. Section 11.06. Notices to and Demands on District and Fiscal Agent. Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Fiscal Agent to or on the District may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the District with the Fiscal Agent) as follows: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 c/o City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, California 91730 Attention: City Manager Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the District to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Fiscal Agent with the District) as follows: Wells Fargo Bank,National Association 707 Wilshire Blvd. 17th Floor Los Angeles, CA 90017 Attention: Corporate Trust Department 60285.00019\7762768.4 42 P768 Section 11.07. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The District hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable. Section 11.08. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remains unclaimed for two (2) years after the date when the payments of such principal, interest and premium have become payable, if such moneys were held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the District as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Bond Owners shall look only to the District for the payment of the principal of, and interest and any premium on, such Bonds. Section 11.09. Provisions Constitute Contract. The provisions of this Agreement shall constitute a contract between the District and the Bondowners and the provisions hereof shall be construed in accordance with the laws of the State of California. In case any suit, action, or proceeding to enforce any right or exercise any remedy shall be brought or taken and, should said suit, action, or proceeding be abandoned, or be determined adversely to the Bondowners or the Fiscal Agent, then the District, the Fiscal Agent, and the Bondowners shall be restored to their former positions rights and remedies as if such suit, action, or proceeding had not been brought or taken. After the issuance and delivery of the Bonds this Agreement shall be irrepealable, but shall be subject to modifications to the extent and in the manner provided in this Agreement, but to no greater extent and in no other manner. Section 11.10. Future Contracts. Nothing herein contained shall be deemed to restrict or prohibit the District from making contracts or creating bonded or other indebtedness payable from a pledge of the Net Special Tax Revenues which is subordinate to the pledge hereunder, or which is payable from taxes or any source other than the Net Special Tax Revenues and other amounts pledged hereunder. Section 11.11. Further Assurances. The District will adopt, make, execute, and deliver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the Bonds the rights and benefits provided in this Agreement. Section 11.12. Applicable Law. This Agreement shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California. 60285.00019\7762768A 43 P769 Section 11.13. Conflict with Act. In the event of a conflict between any provision of this Agreement with any provision of the Act as in effect on the Closing Date, the provision of the Act shall prevail over the conflicting provision of this Agreement. Section 11.14. Conclusive Evidence of Regularity. Bonds issued pursuant to this Agreement shall constitute conclusive evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes. Section 11.15. Payment on Business Day. In any case where the date of the maturity of interest or of principal (and premium, if any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be taken pursuant to this Agreement is other than a Business Day, the payment of interest or principal (and premium, if any) or the action need not be made on such date but may be made on the next succeeding day which is a Business Day with the same force and effect as if made on the date required and no interest shall accrue for the period after such date. Section 11.16. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. [Remainder of this page intentionally left blank.] 60285.00019\7762768.4 44 P77O IN WITNESS WHEREOF, the District has caused this Agreement pertaining to the Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013 to be executed in its name and the Fiscal Agent has caused this Agreement to be executed in its name, all as of July 1, 2013. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 By: City Manager WELLS FARGO BANK, NATIONAL ASSOCIATION, as Fiscal Agent By: Authorized Officer S - 1 60285.00019\7762768.4 P771 EXHIBIT A FORM OF BOND No. $ UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTY OF SAN BERNARDINO CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 INTEREST RATE MATURITY DATE DATED DATE CUSIP September 1, , 2013 REGISTERED OWNER: PRINCIPAL AMOUNT: DOLLARS The City of Rancho Cucamonga (the "City") for and on behalf of the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 (the "District"), for value received, hereby promises to pay solely from Net Special Tax Revenues (as defined in the Agreement) to be collected within Improvement Area No. 2 of the District or amounts in the funds and accounts held under the Agreement (as hereinafter defined), to the registered owner (the "Owner") named above, or registered assigns, on the maturity date set forth above, unless redeemed prior thereto as hereinafter provided, the principal amount set forth above, and to pay interest on such principal amount from the Dated Date, or from the most recent interest payment date to which interest has been paid or duly provided for, semiannually five (5) days prior to each September 1 and March 1, commencing September 1, 2013 (each an "Interest Payment Date"), at the interest rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of this Bond is payable to the registered Owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the office of Wells Fargo Bank, National Association (the "Fiscal Agent"). Interest on this Bond shall be paid by check of the Fiscal Agent mailed five (5) days preceding each Interest Payment Date to the registered Owner hereof as of the close of business on the 15th day of the month preceding the month in which the interest payment date occurs (the "Record Date") at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent. A - 1 60285.00019\7762768.4 P772 This Bond is one of a duly authorized issue of bonds in the aggregate principal amount of $ pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Sections 63311, et seq., of the California Government Code (the "Mello-Roos Act') and designated the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013. The Bonds have been issued for the purpose of refunding the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-B (the "Prior Special Tax Bonds"). The issuance of the Bonds and the terms and conditions thereof are provided for by the Fiscal Agent Agreement, dated as of July 1, 2013 (the "Agreement'), by and between the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 and the Fiscal Agent and this reference incorporates the Agreement herein, and by acceptance hereof the Owner of this Bond assents to said terms and conditions. Pursuant to the Mello-Roos Act and the Agreement, the principal of and interest on this Bond are payable solely from Net Special Tax Revenues of the annual special tax authorized under the Mello-Roos Act to be collected within Improvement Area No. 2 of the District (the "Special Tax") and certain funds held under the Agreement. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Closing Date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. Any tax for the payment hereof shall be limited to the Special Tax, except to the extent that provision for payment has been made by the City, as may be permitted by law. The Bonds do not constitute obligations of the City of Rancho Cucamonga for which said City is obligated to levy or pledge, or has levied or pledged, general or special taxation other than described hereinabove. The District has covenanted for the benefit of the Owners of the Bonds that it will order, and cause to be commenced as provided in the Agreement, and thereafter diligently prosecute to judgment, an action in the superior court to foreclose the lien of any Special Tax or installment thereof not paid when due. The Bonds may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of$5,000) on any Interest Payment Date, from such maturities as are selected by the District, and by lot within a maturity, at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption: A - 2 60285.00019\7762768.4 P773 Redemption Date Redemption Price September 1, 20 through September 1, 20_ 10_% March 1, 20_and September 1, 20 10 March 1, 20 and September 1, 20_ 10_ March 1, 20_and any Interest Payment Date thereafter 100 The Bonds shall be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price September 1, 20_through September 1, 20_ 10_% March 1, 20 and September 1, 20 10_ March 1, 20 and September 1, 20 10_ March 1, 20 and any Interest Payment Date thereafter 100 In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the Bonds. Notice of redemption with respect to the Bonds to be redeemed shall be given to the registered Owners thereof, in the manner, to the extent and subject to the provisions of the Agreement. This Bond shall be registered in the name of the Owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shall be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon. Except as provided in the Agreement, any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of the Agreement by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of A - 3 60285.00019\7762768.4 P774 transfer in a form approved by the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the District shall execute and the Fiscal Agent shall authenticate and deliver a new Bond or Bonds, for like aggregate principal amount. No transfers of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shall be paid by the District. The Fiscal Agent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such exchange. No exchanges of Bonds shall be required to be made (i) fifteen (15) days prior to the date established by the Fiscal Agent for selection of Bonds for redemption; (ii) with respect to a Bond after such Bond has been selected for redemption; or(iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. The Fiscal Agent Agreement and the rights and obligations of the Agency thereunder may be modified or amended as set forth therein. This Bond shall not become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been dated and signed by the Fiscal Agent. IT IS HEREBY CERTIFIED, RECITED, AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond does not exceed any debt limit prescribed by the laws or Constitution of the State of California. [Remainder of this page intentionally left blank.] A - 4 60285.00019\7762768.4 P775 IN WITNESS WHEREOF, the City of Rancho Cucamonga Community Facilities District 2003-01 has caused this Bond to be dated , 2013, to be signed by the manual or facsimile signature of the Mayor and countersigned by the manual or facsimile signature of the City Clerk, each acting for and on behalf of such community facilities district. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 BY: Mayor BY: City Clerk A - 5 60285.00019\7762768.4 P776 FISCAL AGENT'S CERTIFICATE OFAUTHENTICATION This is one of the Bonds described in the Resolution and the Agreement which has been authenticated on WELLS FARGO BANK,NATIONAL ASSOCIATION, as Fiscal Agent By: Authorized Officer A - 6 60285.00019\7762768.4 P777 ASSIGNMENT For value received, the undersigned do(es) hereby sell, assign and transfer unto (Name, Address and Tax Identification or Social Security Number of Assignee) the within Bond and do(es) hereby irrevocably constitute and appoint , attorney, to transfer the same on the registration books of the Fiscal Agent, with full power of substitution in the premises. Dated: NOTICE: The signature(s) on this assignment must correspond with the name(3) as written on the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. Signature Guaranteed: NOTICE: Signature(s) must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company. A - 7 60285.00019\7762768.4 P778 ESCROW DEPOSIT AND TRUST AGREEMENT among CITY OF RANCHO CUCAMONGA, CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank Dated as of July 1, 2013 Re: CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX BONDS SERIES 2003-B 60285.00019\7762860.2 P779 ESCROW DEPOSIT AND TRUST AGREEMENT This ESCROW DEPOSIT AND TRUST AGREEMENT, dated as of July 1, 2013 (the "Escrow Agreement', among CITY OF RANCHO CUCAMONGA (the "City"), CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01, a community facilities district organized and existing by virtue of the Constitution and laws of the State of California (the "Community Facilities District'), and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank(the "Escrow Bank"); WITNESSETH: WHEREAS, the City, acting for and on behalf of the Community Facilities District, has heretofore entered into a Fiscal Agent Agreement with Wells Fargo Bank, National Association, as fiscal agent (the "Prior Fiscal Agent'), dated as of July 1, 2003 (the "Prior Fiscal Agent Agreement'); and WHEREAS, pursuant to the Prior Fiscal Agent Agreement the City, acting for and on behalf of the Community Facilities District, issued the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-B issued in the original principal amount of $2,855,000 (the "Prior Special Tax Bonds"); and WHEREAS, the Prior Fiscal Agent Agreement provides that City, acting on behalf of the Community Facilities District, shall have the option to pay and discharge the entire indebtedness on the Prior Special Tax Bonds Outstanding by irrevocably depositing with the Fiscal Agent, in trust, cash and Federal Securities (as defined in the Prior Fiscal Agent Agreement) in such amount as the City shall determine as confirmed by an independent certified public accountant will, together with interest to accrue to thereon and moneys then on deposit in certain funds and accounts established pursuant to the Prior Fiscal Agent Agreement and certain additional moneys then on deposit with the City for and on behalf of the Community Facilities District, fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates; and WHEREAS, the City and the Community Facilities District has determined that it is in the best interests of the Community Facilities District at this time to refinance the Prior Special Tax Bonds and cause the redemption thereof on September 1, 2013, at a redemption price of 100% of the principal amount thereof, plus accrued interest thereon to the date of redemption; and WHEREAS, the City and the Community Facilities District propose to make the and/or cause the deposit of moneys with the Escrow Bank and to appoint the Escrow Bank as their agent for the purpose of applying said deposit to the payment and redemption of the Prior Special Tax Bonds in accordance with the instructions provided by this Escrow Agreement and the Prior Fiscal Agent Agreement, and the Escrow Bank will accept said appointment; and WHEREAS, to obtain moneys to make such deposit, the Community Facilities District proposes to issue its $ Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Refunding Bonds, Series 2013 (the "2013 Bonds") pursuant to that certain Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent 1 60285.00019\7762860.2 P780 Agreement"), by and between the Community Facilities District and Wells Fargo Bank, National Association, as fiscal agent (the"Fiscal Agent'); and WHEREAS, the City and the Community Facilities District wish to make such deposit with the Escrow Bank and to enter into this Escrow Agreement for the purpose of providing the terms and conditions for the deposit and application of amounts so.deposited; and WHEREAS, the Escrow Bank has full powers to act with respect to the irrevocable escrow and trust created herein and to perform the duties and obligations to be undertaken pursuant to this Escrow Agreement. NOW, THEREFORE, in consideration of the above premises and of the mutual promises and covenants herein contained and for other valuable consideration, the parties hereto do hereby agree as follows: Section 1. Appointment of Escrow Bank. The City and the Community Facilities District hereby appoints the Escrow Bank as escrow bank for all purposes of this Escrow Agreement and in accordance with the terms and provisions of this Escrow Agreement, and the Escrow Bank hereby accepts such appointment. Section 2. Establishment of Escrow Fund. There is hereby created by the City and the Community Facilities District with, and to be held by, the Escrow Bank, an irrevocable escrow to be maintained in trust by the Escrow Bank on behalf of the Community Facilities District and for the benefit of the owners of the Prior Special Tax Bonds, said escrow to be designated the "Escrow Fund." All moneys deposited in the Escrow Fund shall be held as a special fund for the payment of the debt service payments in accordance with the provisions of the Prior Fiscal Agent Agreement. If at any time the Escrow Bank shall receive actual knowledge that the moneys in the Escrow Fund will not be sufficient to make any payment required by Section 3 hereof, the Escrow Bank shall notify the Community Facilities District of such fact and the Community Facilities District shall immediately cure such deficiency. Section 3. Deposit into Escrow Fund. Concurrently with delivery of the Bonds, the City and Community Facilities District shall cause to be transferred to the Escrow Bank for deposit into the Escrow Fund the amount of$ (the "Escrow Fund Deposit Amount') in immediately available funds which shall be derived as follows: (a) $ with respect to the Prior Special Tax Bonds comprised of(i) $ representing funds on deposit in the Reserve Fund, (iii) $ representing funds on deposit in the Administrative Expense Fund, (ii) $ representing funds on deposit in the Project Fund and (iii) $ representing funds on deposit in the Developer Project Fund, (b) $ on deposit with the City and held for and on behalf of the Community Facilities District and (c) $ to come from the Fiscal Agent pursuant to the Fiscal Agent Agreement from the proceeds of the 2013 Bonds. Causey, Demgen & Moore Inc., certified public accountants, has prepared a report at to the sufficiency of the Escrow Fund Deposit Amount to pay the principal and interest on the outstanding Prior Special Tax Bonds on September 1, 2013 (the "Verification Report"), a copy of which is attached as Appendix A hereto and incorporated herein by this reference. 2 60285.00019\7762860.2 P781 The Escrow Bank shall hold the moneys deposited into the Escrow Fund pursuant to the preceding paragraph in cash uninvested (the "Cash"). Such Cash shall be deposited with and held by the Escrow Bank in the Escrow Fund solely for the uses and purposes set forth herein. Section 4. Instructions to Escrow Bank. The Community Facilities District hereby irrevocably directs and instructs the Escrow Bank to redeem the outstanding Prior Special Tax Bonds in full on September 1, 2013 at a redemption price equal to the principal amount thereof, together with accrued interest to the date of redemption, all as more particularly set forth in Exhibit to the Verification Report. For such purpose of call and redemption prior to maturity of the Prior Special Tax Bonds, the Community Facilities District hereby instructs the Escrow Bank, and the Escrow Bank hereby agrees to cause to be given notice of redemption of the Prior Special Tax Bonds on or before August 1, 2013, such notice of redemption to be given substantially in the form set for in Exhibit C attached hereto and hereby made a part hereof and timely for redemption of the Prior Special Tax Bonds on September 1, 2013, in accordance with the applicable provisions of the Prior Fiscal Agent Agreement. Section 5. Application of Certain Terms of Prior Fiscal A eg nt Agreement. All of the terms of the Prior Fiscal Agent Agreement relating to the making of payments of principal and interest with respect to the Prior Special Tax Bonds are incorporated in this Escrow Agreement as if set forth in full herein. The provisions of the Prior Fiscal Agent Agreement relating to the limitations from liability and protections afforded the Prior Fiscal Agent and the resignation and removal of the Prior Fiscal Agent are also incorporated in this Escrow Agreement as if set forth in full herein and shall be the procedure to be followed with respect to any resignation or removal of the Escrow Bank hereunder. Section 6. Compensation to Escrow Bank. The Community Facilities District shall pay the Escrow Bank full compensation for its duties under this Escrow Agreement, including out-of-pocket costs such as publication costs, prepayment or redemption expenses, legal fees and other costs and expenses relating hereto pursuant to a separate agreement between the Community Facilities District and the Escrow Bank. Under no circumstances shall amounts deposited in the Escrow Fund be deemed to be available for said purposes. Section 7. Liabilities and Obligations of Escrow Bank. The Escrow Bank shall have no obligation to make any payment or disbursement of any type or incur any financial liability in the performance of its duties under this Escrow Agreement unless the Community Facilities District shall have deposited sufficient funds with the Escrow Bank to satisfy such obligation. The Escrow Bank may rely and shall be protected in acting upon the written instructions of the City and/or the Community Facilities District or its agents relating to any matter or action as Escrow Bank under this Escrow Agreement. The Escrow Bank undertakes such duties as specifically set forth herein and no implied duties or obligations shall be read into this Escrow Agreement against the Escrow Bank. The Community Facilities District hereby assumes liability for, and hereby agrees (whether or not any of the transactions contemplated hereby are consummated) to indemnify, 3 60285.00019\7762860.2 P782 protect, save and hold harmless the Escrow Bank and its respective successors, assigns, agents and servants from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs, expenses and disbursements (including legal fees and disbursements) of whatsoever kind and nature which may be imposed on, incurred by, or asserted against, at any time, the Escrow Bank (whether or not also indemnified against by any other person under any other agreement or instrument) and in any way relating to or arising out of the execution and delivery of this Escrow Agreement, the establishment of the Escrow Fund, the retention of the moneys therein and any payment, transfer or other application of moneys or securities by the Escrow Bank in accordance with the provisions of this Escrow Agreement, or as may arise by reason of any act, omission or error of the Escrow Bank made in good faith in the conduct of its duties; provided, however, that the Community Facilities District shall not be required to indemnify the Escrow Bank against its own negligence or misconduct. The indemnities contained in this Section 8 shall survive the termination of this Escrow Agreement and the resignation and removal of the Escrow Bank. The Escrow Bank shall not have any liability hereunder except to the extent of its own negligence or willful misconduct. In no event shall the Escrow Bank be liable for any special indirect or consequential damages. The Escrow Bank may consult with counsel of its own choice and the opinion of such counsel shall be full and complete authorization to take or suffer in good faith any action hereunder in accordance with such opinion of counsel. The Escrow Bank shall not be responsible for any of the recitals or representations contained herein. No provision of this Escrow Agreement shall require the Escrow Bank to expend or risk its own funds or otherwise incur any financial liability in the performance or exercise of any of its duties hereunder, or in the exercise of its rights or powers. Section 8. Amendment. This Escrow Agreement may be modified or amended at any time by a supplemental agreement which shall become effective when the written consents of the owners of one hundred percent (100%) in aggregate principal amount of the Prior Special Tax Bonds then outstanding shall have been filed with the Escrow Bank. This Escrow Agreement may be modified or amended at any time by a supplemental agreement, without the consent of any such owners, but only (1) to add to the covenants and agreements of any party, other covenants to be observed, or to surrender any right or power herein or therein reserved to the Community Facilities District, (2) to cure, correct or supplement any ambiguous or defective provision contained herein, or (3) in regard to questions arising hereunder or thereunder, as the parties hereto or thereto may deem necessary or desirable and which, in the opinion of counsel, shall not adversely affect the interests of the owners of the Prior Special Tax Bonds or the Bonds, and that such amendment will not cause interest on the Prior Special Tax Bonds or the Bonds to become subject to federal income taxation. Section 9. Termination; Unclaimed Monev. This Escrow Agreement shall terminate when the Prior Special Tax Bonds have been paid; provided, however, that (i) money held by the Escrow Bank pursuant to this Escrow Agreement for the payment and discharge of any of the Prior Special Tax Bonds (which shall not be payable as to interest from and after the 4 60285.00019\7762860.2 P783 date set for redemption) which remain unclaimed for two (2) years after such payments were due, shall be repaid by the Escrow Bank to the Community Facilities District free from the trust created by the Prior Fiscal Agent Agreement and this Escrow Agreement, and the Escrow Bank shall thereupon be released and discharged with respect thereto and hereto and all liability of the Escrow Bank with respect to such money shall thereupon cease and (ii) excess moneys held by the Escrow Bank not needed for the payment and discharge of the Prior Special Tax Bonds shall be transferred to the Bond Fund under the Fiscal Agent Agreement. Section 10. Severability. If any section, paragraph, sentence, clause or provision of this Escrow Agreement shall for any reason be held to be invalid or unenforceable, the invalidity or unenforceability of such section, paragraph, sentence, clause or provision shall not affect any of the remaining provisions of this Escrow Agreement. Section 11. Notice to Escrow Bank, the City and the Community Facilities District. Any notice or demand which by any provision of this Escrow Agreement is required or permitted to be given or served by the Escrow Bank to or on the City and/or the Community Facilities District may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the City and/or the Community Facilities District with the Fiscal Agent) as follows: City of Rancho Cucamonga Community Facilities District No. 2003-01 c/o City of Rancho Cucamonga 10500 Civic Center Drive Rancho Cucamonga, California 91730 Attention: City Manager Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the City and/or the Community Facilities District to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Fiscal Agent with the City and/or the Community Facilities District) as follows: Wells Fargo Bank,National Association 707 Wilshire Blvd. 17th Floor Los Angeles, CA 90017 Attention: Corporate Trust Department Section 12. Merger or Consolidation of Escrow Bank. Any company into which the Escrow Bank may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Escrow Bank may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible to act as Trustee under the Indenture and the Prior Fiscal Agent Agreement, shall be the successor hereunder to the Escrow Bank without the execution or filing of any paper or any further act. Section 13. Execution in Several Counterparts. This Escrow Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be 5 60285.00019\7762860.2 P784 deemed to be an original; and all such counterparts shall constitute but one and the same instrument. 6 60285.00019\7762860.2 P785 IN WITNESS WHEREOF, the City, the Community Facilities District and the Escrow Bank have each caused this Escrow Deposit and Trust Agreement to be executed by their duly authorized officers all as of the date first above written. CITY OF RANCHO CUCAMONGA By: City Manager CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: City Manager WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank By: Authorized Officer 7 60285.00019\7762860.2 P786 EXHIBIT A VERIFICATION REPORT A - 1 60285.00019\7762860.2 P787 EXHIBIT NOTICE OF REDEMPTION CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX BONDS, SERIES 2003-B NOTICE 1S HEREBY GIVEN that on September 1, 2013 (the "Redemption Date"), the above-captioned bonds (the "Bonds") have been called for redemption pursuant to Section 2.3(A)(i) of the Fiscal Agent Agreement, dated as of August 1, 2001, by and between Wells Fargo Bank, National Association, as fiscal agent (the "Fiscal Agent"), and the City of Rancho Cucamonga, for and on behalf of Community Facilities District No. 2003-01 (the "Community Facilities District"). The Bonds will be prepaid at 100% of the principal amount, plus accrued interest (the "Redemption Price"). Interest will be paid in the usual manner. The CUSIP numbers and maturity dates of the Bonds are listed below: CUSIP Number Maturity Date The Bonds are due and payable at the office of the Fiscal Agent on Redemption Date. Interest will cease to accrue on the Bonds from and after the Redemption Date. The Bonds should be presented for redemption to the office of the Fiscal Agent at the following address: [TO COME] To avoid a 28% back-up withholding tax required by Federal law, holders of Bonds must submit with their Bonds a completed IRS Form W-9. For your convenience a Form W-9 has been enclosed. The CUSIP number has been assigned by Standard & Poor's Corporation and is included solely for the convenience of the holders of Bonds. Neither the Community Facilities District nor the Trustee shall be responsible for the selection or use of the CUSIP numbers nor is any representation made as to their correctness on the Bonds or as indicated in any redemption Notice. Dated: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Escrow Bank 60285.00019\7762860.2 -1- P788 Stradling Yocca Carlson & Rauth CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 BOND PURCHASE AGREEMENT July_, 2013 Community Facilities District No. 2003-01 Improvement Area No. 2 of the City of Rancho Cucamonga Rancho Cucamonga, California Ladies and Gentlemen: Stifel, Nicolaus & Company, Incorporated dba Stone & Youngberg, a Division of Stifel Nicolaus (the "Underwriter") offers to enter into this Bond Purchase Agreement with the Community Facilities District No. 2003-01, Improvement Area No. 2, of the City of Rancho Cucamonga (the "District") which, upon acceptance, will be binding upon the District and upon the Underwriter. This offer is made subject to acceptance of it by the District on the date hereof, and if not accepted, will be subject to withdrawal by the Underwriter upon notice delivered to the District at any time prior to the acceptance hereof by the District. The District acknowledges and agrees that: (i) the purchase and sale of the Bonds (defined below) pursuant to this Purchase Agreement is an arm's-length commercial transaction between the District and the Underwriter; (ii) in connection therewith and with the discussions, undertakings and procedures leading up to the consummation of such transaction, the Underwriter is and has been acting solely as a principal and is not acting as a Municipal Advisor (as defined in Section 15B of The Securities Exchange Act of 1934, as amended); (iii) the Underwriter has not assumed an advisory or fiduciary responsibility in favor of the District with respect to the offering contemplated hereby or the discussions, undertakings and procedures leading thereto (irrespective of whether the Underwriter has provided other services or is currently providing other services to the District on other matters); (iv) the District has consulted its own legal, financial and other advisors to the extent it has deemed appropriate; and (v) the Underwriter has financial and other interests that differ from those of the District. 1. Purchase, Sale and Delivery of the Bonds. (a) Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein, the Underwriter agrees to purchase from the District, and the District agrees to sell to the Underwriter, all (but not less than all) of the Community Facilities District No. 2003-01, Improvement Area No. 2, of the City of Rancho Cucamonga Special Tax 1 DOCSOC/1628871 v2/022245-0268 P789 Refunding Bonds, Series 2013 (the "Bonds") in the aggregate principal amount specified in Exhibit A hereto. The Bonds shall be dated the date of their delivery, and bear interest (payable semiannually on March 1 and September 1 in each year), commencing on March 1, 2014, at the rates per annum and maturing on the dates and in the amounts as set forth in said Exhibit A. The purchase price for the Bonds shall be the amount specified as such in Exhibit A hereto. The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable and subject to redemption as provided in, the Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent Agreement") executed by the District, acting through the City Council of the City of Rancho Cucamonga (the "City"), sitting as the legislative body of the District (the "City Council"), and Wells Fargo Bank, National Association, as Fiscal Agent, which was approved by the District in a resolution (the "Resolution"), adopted by the City Council on July_, 2013. The Bonds and interest thereon will be payable from a special tax (the "Special Tax") levied and collected in accordance with the Fiscal Agent Agreement and an ordinance adopted by the City Council, on [February 19, 2003] (the "Ordinance"). Proceeds of the sale of the Bonds will be used in accordance with the Fiscal Agent Agreement and the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California) (the "Act"), to refund the District's outstanding Special Tax Bonds, Series 2003-A (the "Refunded Bonds") in accordance with an Escrow Agreement, dated as of April 1, 2013 (the "Escrow Agreement"), by and between the District and Wells Fargo Bank, National Association, as Escrow Agent. The Bonds are being issued in accordance with the provisions of the Fiscal Agent Agreement, the Act and Article 11, commencing with Section 53580, of Chapter 3 of Part 1 of Division 2 of Title 5 of the California Government Code (the "Law"). (b) At or prior to the acceptance hereof by the District, the City on behalf of the District shall cause to be delivered to the Underwriter (i) a certificate executed by Foothill Crossings, a California limited liability company ("Foothill Crossings"), dated on or prior to the date of this Bond Purchase Agreement in the form attached hereto as Exhibit B-1; and (ii) a certificate executed by Rancho BP, LLC, a Delaware limited liability company ("Rancho BP"), dated on or prior to the date of this Bond Purchase Agreement in the form attached hereto as Exhibit B-2. (c) Pursuant to the authorization of the District, the Underwriter has distributed copies of the Preliminary Official Statement, dated July_, 2013, relating to the Bonds, which, together with the cover page and all appendices thereto, is herein called the "Preliminary Official Statement" and which, as amended by the District with the prior approval of the Underwriter, will be referred to herein as the "Official Statement." The District hereby ratifies the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to use and distribute the Official Statement, the Fiscal Agent Agreement, the other documents or contracts to which the City or the District is a party, including this Bond Purchase Agreement, and all information contained therein, and all other documents, certificates and statements furnished by the City or the District to the Underwriter in connection with the transactions contemplated by this Bond Purchase Agreement, in connection with the offer and sale of the Bonds by the Underwriter. At or prior to the Closing Date (described below), the District shall have authorized, executed and delivered the Continuing Disclosure Certificate, dated as of the Closing Date (the "Continuing Disclosure Certificate"), which complies with paragraph (b)(1) of Section 240.15c2-12 in Chapter II of Title 17 of the Code of Federal Regulations ("Rule 15c2-12"), substantially in the form described in the Official Statement. 2 DOCSOC/1628871 v2/022245-0268 P790 (d) At 8:00 A.M., Los Angeles time, on July_, 2013, or at such earlier time or date as shall be agreed upon by the Underwriter and the District (such time and date being herein referred to as the "Closing Date"), the District will deliver to the Underwriter through the book-entry system of The Depository Trust Company, the Bonds in temporary or definitive form, bearing CUSIP numbers, and duly executed by the officers of the District as provided in the Fiscal Agent Agreement and with the facsimile seal of the City printed thereon. Additionally, the District will deliver to the Underwriter at the offices of Best, Best & Krieger, LLP ("Bond Counsel'), in San Diego, California, or such other location in San Diego, California, as may be agreed to by the District and the Underwriter, the other documents herein mentioned; and the Underwriter shall accept such delivery and pay the purchase price of the Bonds in immediately available funds (such delivery and payment being herein referred to as the "Closing"). The Bonds shall be in fully registered form, registered in the name of CEDE & Co., as nominee of The Depository Trust Company. The District will make such Bonds available for inspection by the Underwriter not later than the business day prior to the Closing. 2. Representations, Warranties and A¢reements of the District. The District represents, warrants and covenants to and agrees with the Underwriter that: (a) The District is duly organized and validly existing as a community facilities district under the laws of the State of California and has, and at the Closing Date will have, as the case may be, full legal right, power and authority (i) to execute, deliver and perform its obligations under this Bond Purchase Agreement and to carry out all transactions contemplated hereby, (ii)to issue, sell and deliver the Bonds to the Underwriter pursuant to the Resolution and the Fiscal Agent Agreement as provided herein, and (iii)to carry out, give effect to and consummate the transactions contemplated by the Resolution, the resolution forming the District adopted by the City Council on February 19, 2003 (the "Resolution of Formation"), the Ordinance, the Official Statement, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement; (b) The District has complied, and will at the Closing Date be in compliance, in all respects with the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Act, the Law, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement and the District will continue to comply with the covenants of the District contained in the Fiscal Agent Agreement; (c) The City Council has duly and validly: (i) adopted the Resolution, the Resolution of Formation and the Ordinance; (ii) called, held and conducted in accordance with all requirements of the Act an election to approve the levy of the Special Taxes; (iii) authorized and approved the execution and delivery of the Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement; (iv) authorized the preparation and delivery of the Official Statement; and (v) authorized and approved the performance by the City and the District of their respective obligations contained in, and the taking of any and all action as may be necessary to carry out, give effect to and consummate the transactions contemplated by, each of said documents (including, without limitation, the collection of the Special Tax), and at the Closing Date, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Bonds, the Continuing Disclosure Certificate, this Bond Purchase Agreement and the Escrow Agreement will constitute the valid, legal and binding obligations of the District, and (assuming due authorization, execution and delivery by other parties thereto, where necessary) will be enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, 3 DOCSOC/1628871 v2/022245-0268 P791 reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought; (d) To the best of its knowledge, the District is not in breach of or default under any applicable law or administrative rule or regulation of the State of California (the "State"), or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the District is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the performance by the District of its obligations under the Bonds, the Resolution, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate, this Bond Purchase Agreement, or the Escrow Agreement, and compliance with the provisions of each thereof, will not in any respect material to the transactions referred to herein or contemplated hereby, conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State, or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, contract, agreement or other instrument to which the District or the City, as the case may be, is a party or is otherwise subject or bound; N (e) All approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the performance by the District of its obligations hereunder, or under the Resolution, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Bonds, the Continuing Disclosure Certificate or the Escrow Agreement, have been or will be obtained and are in full force and effect, except that the District provides no representation regarding compliance with blue sky or other securities laws or regulations whatsoever; (f) The Special Tax constituting the security for the Bonds has been duly and lawfully authorized and may be levied under the Act and the Constitution and the applicable laws of the State of California, and such Special Tax constitutes a valid and legally binding lien on the properties on which it has been levied; (g) Until the date which is twenty-five (25) days after the "end of the underwriting period" (as hereinafter defined), if any event shall occur of which the District is aware, as a result of which it may be necessary to supplement the Official Statement in order to make the statements in the Official Statement, in light of the circumstances existing at such time, not misleading, the District shall forthwith notify the Underwriter of any such event of which it has knowledge and shall cooperate fully in furnishing any information available to it for any supplement to the Official Statement necessary, in the Underwriter's opinion, so that the statements therein as so supplemented will not be misleading in light of the circumstances existing at such time and the District shall promptly furnish to the Underwriter a reasonable number of copies of such supplement. As used herein, the term "end of the underwriting period" means the later of such time as (i) the District delivers the Bonds to the Underwriter, or (ii) the Underwriter does not retain, directly or as a member of an underwriting syndicate, an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the "end of the underwriting period" shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the District at or prior to the Closing Date, and shall specify a date (other than the Closing Date)to be deemed the "end of the underwriting period;" 4 DOCSOC/1628871 v2/022245-0268 P792 (h) The Fiscal Agent Agreement creates a valid pledge of the Net Special Tax Revenues (as defined in the Fiscal Agent Agreement) and the moneys in the Reserve Fund, the Escrow Fund, and the Special Tax Fund established pursuant to the Fiscal Agent Agreement, including the investments thereof, subject in all cases to the provisions of the Fiscal Agent Agreement permitting the application thereof for the purposes and on the terms and conditions set forth therein; (i) As of the time of acceptance hereof, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending in which service of process has been completed against the District or the City or, to the best knowledge of the District, threatened against the District or the City (i)which would materially adversely affect the ability of either the City or the District to perform its obligations under the Bonds, the Fiscal Agent Agreement, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate or the Escrow Agreement, or (ii) seeking to restrain or to enjoin the development of the land within the District, the issuance, sale or delivery of the Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement and the Escrow Agreement, or the collection or application of the Special Tax pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Bonds, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Continuing Disclosure Certificate, this Bond Purchase Agreement or the Escrow Agreement, any other instruments relating to the development of any of the property within the District, or any action of the District contemplated by any of said documents or(iii) in any way contesting the completeness or accuracy of the Preliminary Official Statement or the powers or authority of the City or the District with respect to the Bonds, the Resolution, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate, the Resolution of Formation and the Ordinance or any action of the City or the District contemplated by any of said documents; or (iv) which alleges that interest on the Bonds is not excludable from gross income for federal income tax purposes or is not exempt from California personal income taxation; 6) The District will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order for the Underwriter to qualify the Bonds for offer and sale under the "Blue Sky" or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate; provided, however, the District shall not be required to register as a dealer or a broker of securities nor shall the District be required to consent to service of process or jurisdiction or qualify to do business in any jurisdiction or to expend funds for this purpose; (k) Any certificate signed by any authorized official of the District authorized to do so shall be deemed a representation and warranty of the District to the Underwriter as to the statements made therein; (1) The District will apply the proceeds of the Bonds in accordance with the Fiscal Agent Agreement and the Escrow Agreement and as described in the Official Statement; (m) The information contained in the Preliminary Official Statement was, and in the Official Statement (other than information relating to The Depository Trust Company and its book-entry-only system, as to which no view is expressed) is and on the Closing Date shall be, true and correct in all material respects and such information does not contain any untrue or misleading 5 DOCSOC/1628871 v2/022245-0268 P793 statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (n) Except as disclosed in the Official Statement, the District has never failed to comply in any material respect with any of its previous undertakings with respect to Rule 15c2-12; and (o) The Preliminary Official Statement heretofore delivered to the Underwriter is deemed final by the District as of its date except for the omission of such information as is permitted to be omitted in accordance with Rule 15c2-12. The District hereby covenants and agrees that, within seven (7) business days from the date hereof, or upon reasonable written notice from the Underwriter within sufficient time to accompany any confirmation requesting payment from any customers of the Underwriter, the District shall cause a final printed form of the Official Statement to be delivered to the Underwriter in sufficient quantity to comply with the rules of the Securities and Exchange Commission and the Municipal Securities Rulemaking Board. 3. Representations, Warranties, Covenants and Agreements of the Underwriter. The Underwriter represents, warrants, covenants and agrees with the District as follows: (a) To file a copy of the Official Statement, including any supplements prepared by the District, with the Municipal Securities Rulemaking Board, and (b) to take any and all other actions necessary to comply with applicable Securities and Exchange Commission and Municipal Securities Rulemaking Board rules governing the offering, sale and delivery of the Bonds to ultimate purchasers. 4. Conditions to the Obligations of the Underwriter. The obligations of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the representations and warranties on the part of the District contained herein, as of the date hereof and as of the Closing Date, to the accuracy in all material respects of the statements of the officers and other officials of the City and the District made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the District of its respective obligations to be performed hereunder at or prior to the Closing Date and to the following additional conditions: (a) At the. Closing Date, the Resolution, the Resolution of Formation, the Ordinance, the Fiscal Agent Agreement, the Continuing Disclosure Certificate, the Escrow Agreement, and this Bond Purchase Agreement shall be in full force and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to by the Underwriter, and there shall have been taken in connection therewith, with the issuance of the Bonds and with the transactions contemplated thereby and by this Bond Purchase Agreement, all such actions as, in the opinion of Bond Counsel, shall be necessary and appropriate; (b) Between the date hereof and the Closing Date, the market price or marketability of the Bonds at the initial offering prices set forth in the Official Statement shall not have been materially adversely affected, in the reasonable judgment of the Underwriter (evidenced by a written notice to the District terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following: 6 DOCSOC/1628871 v2/022245-0268 P794 (1) legislation enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congress by any committee of such House to which such legislation had been referred for consideration or a decision rendered by a court established under Article III of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department or the Internal Revenue Service of the United States of America, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon the interest as would be received by the holders of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof, (2) legislation enacted (or resolution passed) by the Congress of the United States of America, or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, or the Bonds, including any or all underlying arrangements, are not exempt from registration under the Securities Act of 1933, as amended, or that the Fiscal Agent Agreement is not exempt from qualification under the Trust Indenture Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character of the Bonds, including any or all underwriting arrangements, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws as amended and then in effect; (3) a general suspension of trading in securities on the New York Stock Exchange, or a general banking moratorium declared by Federal, State of New York or State of California officials authorized to do so, or a war or other national calamity; (4) any amendment to the federal or California Constitution or action by any federal or California court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the District, its property, income, securities (or interest thereon), the validity or enforceability of the Special Tax; (5) any event occurring, or information becoming known, which, in the judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Official Statement, or results in the Official Statement containing any untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; and (6) any rating of the Bonds shall have been downgraded or withdrawn by a national rating service, which, in the opinion of the Underwriter, materially adversely affects the market price of the Bonds. (c) On the Closing Date, the Underwriter shall have received counterpart originals or certified copies of the following documents, in each case satisfactory in form and substance to the Underwriter: 7 DOCSOC/I628871 v2/022245-0268 P795 (1) The Resolution, the Resolution of Formation and the Ordinance, together with a certificate dated as of the Closing Date of a City Clerk of the City Council to the effect that each is a true, correct and complete copy of the one duly adopted by the City Council; (2) An executed copy of the Fiscal Agent Agreement; (3) A copy of the Official Statement; (4) An executed copy of the Escrow Agreement; (5) An executed copy of the Continuing Disclosure Certificate of the District, dated the date of the Closing; (6) An unqualified approving opinion, dated the Closing Date and addressed to the District, of Bond Counsel, in the form attached to the Preliminary Official Statement as Appendix D and a letter of such counsel, dated the Closing Date and addressed to the Underwriter, to the effect that such opinion addressed to the District may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it; (7) A supplemental opinion, dated the Closing Date and addressed to the District and the Underwriter, of Bond Counsel to the effect that (i) the Bond Purchase Agreement, the Escrow Agreement and the Continuing Disclosure Certificate have been duly authorized, executed and delivered by the District, and, assuming the execution and delivery by the other parties thereto as appropriate, the Bond Purchase Agreement, the Escrow Agreement and the Continuing Disclosure Certificate constitute the legally valid and binding agreements of the District enforceable in accordance with their respective terms, except as enforcement may be limited by bankruptcy, moratorium, insolvency or other laws affecting creditor's rights or remedies and is subject to general principles of equity (regardless of whether such enforceability is considered in equity or at law); (ii)the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Fiscal Agent Agreement is exempt from qualification under the Trust Indenture Act of 1939, as amended; (iii)the information contained in the Official Statement with respect to the Bonds under the captions "THE 2013 BONDS," "PLAN OF REFUNDING," "SECURITY FOR THE 2013 BONDS" and "TAX MATTERS" and in APPENDIX C—"SUMMARY OF THE FISCAL AGENT AGREEMENT" (except information relating to The Depository Trust Company and its book-entry system, as to which no opinion need be expressed) is accurate in all material respects; (iv) the Special Taxes have been duly and validly authorized in accordance with the provisions of the Act and, when levied in accordance with the Act and the Ordinance, the Special Taxes shall represent a valid lien on the respective properties against which the Special Taxes have been levied; and (v) the Refunded Bonds set forth in the Escrow Agreement, have been defeased and are no longer outstanding in accordance with the terms of the Fiscal Agent Agreement, pursuant to which the Refunded Bonds were issued. In rendering the opinion set forth in clause (v), Bond Counsel may expressly assume that all actions required to be taken under the Fiscal Agent Agreement have been taken and that all covenants and agreements contained in the Fiscal Agent Agreement have been complied with; (8) An opinion, dated the Closing Date and addressed to the Underwriter, of Jones Hall, a Professional Law Corporation, San Francisco, California, as Disclosure Counsel, to the effect that (i)the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended, and the Fiscal Agent Agreement is exempt from qualification pursuant to the 8 DOCSOC/1628871 v2/022245-0268 P796 Trust Indenture Act of 1939, as amended and (ii) without having undertaken to determine independently the accuracy or completeness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the City, City Attorney, Bond Counsel, representatives of the Underwriter and others, and their examination of certain documents, no information has come to the attention of the attorneys in the firm providing legal services to the Underwriter with respect to the Bonds which would lead them to believe that the Official Statement as of its date and as of the Closing Date contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to the Appendices of the Official Statement or any other financial, statistical and demographic data or forecasts, numbers, charts, estimates, projections, assumptions or expressions of opinion, and information about book-entry or the DTC contained in the Official Statement); (9) An opinion, dated the Closing Date and addressed to the Underwriter, of Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California, in form and substance satisfactory to the Underwriter; (10) A Certificate, dated the Closing Date and signed by an authorized representative of the District and the City, ratifying the use and distribution by the Underwriter of the Preliminary Official Statement and the Official Statement in connection with the offering and sale of the Bonds and certifying that (i) the representations and warranties of the District contained in Section 2 hereof are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii)to the best of his or her knowledge, no event has occurred since the date of thF Official Statement affecting the matters contained therein which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make the statements and information contained in the Official Statement with respect to the District and the City not misleading in any material respect, and the Bonds, the Fiscal Agent Agreement and other applicable agreements conform as to form and tenor to the descriptions thereof contained in the Official Statement; and (iii)the District has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under this Bond Purchase Agreement, the Resolution, the Resolution of Formation, the Ordinance, the Escrow Agreement and the Fiscal Agent Agreement at or prior to the Closing Date, (11) An opinion, dated the Closing Date and addressed to the Underwriter, of counsel to the District and the City, to the effect that (i) to the best of her knowledge, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending in which service of process has been completed against the District or the City, or threatened against the City or the District which would materially adversely affect the ability of the District to perform its obligations hereunder or under the Bonds, the Fiscal Agent Agreement, the Resolution, the Resolution of Formation, the Ordinance, the Continuing Disclosure Certificate or the Escrow Agreement, or seeking to restrain or to enjoin the issuance, sale, delivery of the Bonds or the exclusion from gross income for federal income tax purposes or State of California personal income taxes of interest on the Bonds, or the application of the proceeds thereof in accordance with the Fiscal Agent Agreement and the Escrow Agreement, or the collection or application of the Special Tax to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bonds, the Resolution, the Resolution of Formation, the Fiscal Agent Agreement, the Ordinance, the Continuing Disclosure Certificate, the Escrow Agreement or this Bond Purchase Agreement or the accuracy of the Official Statement, or 9 DOCSOC/1628871 v2/022245-0268 P797 any action of the City or the District contemplated by any of said documents; (ii)the City is duly organized and validly existing as a municipal corporation and general law City, duly organized and validly existing under the Constitution and laws of the State of California and the District is duly organized and validly existing as a community facilities district under the Constitution and laws of the State of California, with, as the case may be, full legal right, power and authority to issue the Bonds and to perform all of its obligations under this Bond Purchase Agreement, the Bonds, the Fiscal Agent Agreement, the Continuing Disclosure Certificate and the Escrow Agreement; (iii) except for the adoption of the resolution each year approving the annual levy of the Special Tax by the City, acting as the legislative body of the District, the District has obtained all approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which constitute a condition precedent to the levy of the Special Tax, the issuance of the Bonds or the performance by the District of its obligations thereunder or under the Fiscal Agent Agreement or the Escrow Agreement, except that no opinion need be expressed regarding compliance with blue sky or other securities laws or regulations, whatsoever; (iv) the City Council has duly and validly adopted the Resolution, the Resolution of Formation and the Ordinance at meetings of the City Council which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting at the time of adoption, and the Resolution, the Resolution of Formation, the Ordinance, the Fiscal Agent Agreement and the Escrow Agreement are now in full force and effect and the same have not been amended; and (v) the District has duly authorized, executed and delivered this Bond Purchase Agreement, the Fiscal Agent Agreement, the Escrow Agreement and the Bonds and has duly authorized the preparation and delivery of the Official Statement, and this Bond Purchase Agreement, the Bonds, the Continuing Disclosure Certificate, the Escrow Agreement, the Continuing Disclosure Certificate and the Fiscal Agent Agreement constitute legal, valid and binding agreements of the District, enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought and to limitations on remedies imposed in actions against public entities in the State of California; (12) A tax certificate of the District, in a form acceptable to Bond Counsel; (13) A certificate of the District executed by an authorized representative thereof, dated the Closing Date and in form and substance satisfactory to the Underwriter and counsel to the Underwriter, to the effect that the District is in full compliance with all of its prior undertakings entered into pursuant to the provisions of Rule 15c2-12(b)(5); (14) A certificate from David Taussig & Associates, Inc. to the effect that (i)the Special Tax, if applied and collected in accordance with the terms set forth in the Rate and Method of Apportionment of Special Tax of the District, would generate an amount at least equal to debt service on the Bonds, (ii) the Special Taxes, if collected in the maximum amounts permitted pursuant to the Rate and Method of Apportionment of Special Tax on the date hereof, would generate at least 110% of the maximum debt service on the Bonds, based on such assumptions and qualifications as shall be acceptable to the Underwriter, and (iii)the information supplied by such firm for use in the sections captioned "SECURITY FOR THE 2013 BONDS—Special Taxes," "- Summary of Rate and Method," "IMPROVEMENT AREA NO. 2—Land Use Distribution," "- Assessed Property Values," "—Value-to-Lien Ratio," `—Land Owners," `—Delinquencies," and "—Scheduled Debt Service Coverage" of the Official Statement is true and correct as of the date of the Official Statement and as of the Closing Date; 10 DOCSOC/1628871 v2/022245-0268 P798 (15) A certificate dated the Closing Date, from Foothill Crossings, in substantially the form attached hereto as Exhibit C-1; (16) A certificate dated the Closing Date, from Rancho BP, in substantially the form attached hereto as Exhibit C-2; (17) A Continuing Disclosure Certificate, executed by Rancho BP, in substantially the form attached to the Official Statement as Appendix F; (18) A Continuing Disclosure Certificate, executed by Foothill Crossings, in substantially the form attached to the Official Statement as Appendix F; and (19) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the statements and information contained in the Preliminary Official Statement and the Official Statement, of the District's representations and warranties contained herein and the due performance or satisfaction by the District at or prior to the Closing of all agreements then to be performed and all conditions then to be satisfied by the District in connection with the transactions contemplated hereby and by the Resolution and the Official Statement. If the District shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Bond Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Bond Purchase Agreement, this Bond Purchase Agreement shall terminate and neither the Underwriter nor the District shall be under any further obligation hereunder, except that the respective obligations of the District and the Underwriter set forth in Section 6 hereof shall continue in full force and effect. 5. Conditions of the District's Obli atg ions. The District's obligations hereunder are subject to the Underwriter's performance of their obligations hereunder, and are also subject to the following conditions: (a) As of the Closing Date, no litigation shall be pending in which service of process has been completed against the District or, to the knowledge of the duly authorized officer of the District executing the certificate referred to in Section 4(c)(I0) hereof, threatened, to restrain or enjoin the issuance or sale of the Bonds or in any way affecting any authority for or the validity of the Bonds, the Resolution, the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate or this Bond Purchase Agreement or the existence of powers of the District; and (b) As of the Closing Date, the District shall receive the approving opinions of Bond Counsel referred to in Section 4(c)(6) hereof, dated as of the Closing Date, addressed to the District, together with a reliance letter addressed to the Underwriter. 11 DOCSOC/1628871 v2/022245-0268 P799 6. Expenses. Whether or not the Bonds are delivered to the Underwriter as set forth herein: (a) The Underwriter shall be under no obligation to pay, and the District shall pay or cause to be paid (out of any legally available funds of the District) all expenses incident to the performance of the District's obligations hereunder, including, but not limited to, the cost of printing and delivering the Bonds to the Underwriter, the cost of preparation, printing (and/or word processing and reproduction), distribution and delivery of the Fiscal Agent Agreement, the Escrow Agreement, the Continuing Disclosure Certificate and all other agreements and documents contemplated hereby (and drafts of any thereof); the cost of printing the Preliminary Official Statement and the Official Statement in such reasonable quantities as requested by the Underwriter; and the fees and disbursements of the fiscal agent and registrar for the Bonds, Bond Counsel, the Escrow Agent, any accountants, engineers or any other experts or consultants the City or the District have retained in connection with the Bonds; and (b) The District shall be under no obligation to pay, and the Underwriter shall pay, the cost of preparation of any "blue sky" or legal investment memoranda and this Bond Purchase Agreement; expenses to qualify the Bonds for sale under any "blue sky" or other state securities laws; CDIAC fees and all other expenses incurred by the Underwriter in connection with their public offering and distribution of the Bonds (except those specifically enumerated in paragraph (a) of this section), including the fees and disbursements of its counsel and any advertising expenses. 7. Notices. Any notice or other communication to be given to the District under this Bond Purchase Agreement may be given by delivering the same in writing to the City of Rancho Cucamonga Community Facilities District No. 2003-01, c/o City of Rancho Cucamonga, 10500 Civic Center Drive, Rancho Cucamonga, California, 91730, Attention: City Manager; and any notice or other communication to be given to the Underwriter under this Bond Purchase Agreement may be given by delivering the same in writing to Stifel Nicolaus & Company, Incorporated dba Stone Youngberg, a Division of Stifel Nicolaus, One Ferry Building, Suite 275, San Francisco, California 94111, Attention: Jim Cervantes. 8. Parties in Interest. This Bond Purchase Agreement is made solely for the benefit of the District and the Underwriter (including their successors or assigns), and no other person shall acquire or have any right hereunder or by virtue hereof. 9. Survival of Representations and Warranties. The representations and warranties of the District set forth in or made pursuant to this Bond Purchase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing or termination of this Bond Purchase Agreement and regardless of any investigations made by or on behalf of the Underwriter (or statements as to the results of such investigations) concerning such representations and statements of the District and regardless of delivery of and payment for the Bonds. 10. Effective. This Bond Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the District and shall be valid and enforceable as of the time of such acceptance. This Bond Purchase Agreement may be signed in counterparts by each party. 12 DOCSOC/1628871 v2/022245-0268 P800 11. No Prior Agreements. This Bond Purchase Agreement supersedes and replaces all prior negotiations, agreements and understandings between the parties hereto in relation to the sale of Bonds for the District. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 13 DOCSOC/1 62887 1 v2/022245-0268 P801 12. Governing Law. This Purchase Contract shall be governed by the laws of the State of California. Very truly yours, STIFEL NICOLAUS & COMPANY, INCORPORATED By: Authorized Representative ACCEPTED: 2013 at .m. COMMUNITY FACILITIES DISTRICT NO. 2003-01, IMPROVEMENT AREA NO. 2 OF THE CITY OF RANCHO CUCAMONGA By. City Manager 14 DOCSOC/1628871 v2/022245-0268 P802 EXHIBIT A MATURITY SCHEDULE CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 Maturity Date Principal (September 1) Amount Interest Rate Yield The purchase price of the Bonds shall be $ (representing the principal amount of the Bonds in the amount of $ less an Underwriter's discount of$ [plus/less] net original issue [premium/discount] of$ ). A-1 DOCSOC/1628871 v2/022245-0268 P803 EXHIBIT B-1 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 106-5 CERTIFICATE OF FOOTHILL CROSSINGS The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga (the "Issuer")of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of Foothill Crossing, LLC, a California limited liability company(the "Property Owner"). (2) This Certificate is delivered in connection with the offering and sale of the bonds captioned above (the "Bonds"). (3) In connection with the offering and sale of the Bonds, there has been prepared a Preliminary Official Statement (the "Preliminary Official Statement"), setting forth certain information concerning, among other things, the Bonds, the Property Owner; the organization, activities, properties and financial condition of the Property Owner; and the Property Owner's property within Improvement Area No. 2 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the"Improvement Area"). (4) The sections in the Preliminary Official Statement to the extent they describe or relate to the Property Owner contain no untrue statement of a material fact and do not omit any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (5) The Property Owner has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (6) The Property Owner has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (7) The Property Owner is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by the Property Owner or the ability of the Property Owner to pay special taxes levied in the Improvement Area(the "Special Taxes"). (8) The Property Owner is solvent, and no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. B-1-1 DOCSOC/1628871 v2/022245-0268 P804 (9) There is no litigation or administrative proceeding of any nature in which the Property Owner has been served, or is pending or threatened which, if successful, would materially adversely affect the ownership and operation of the property owned by the Property Owner, or the ability of the Property Owner to pay the Special Taxes. Dated: [POS date] FOOTHILL CROSSING, LLC By: GMS Holdings, Inc., a California corporation Its: Manager By: Gary M. Safady, President B-1-2 DOCSOC/1628871 v2/022245-0268 P805 EXHIBIT B-2 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 IOb-5 CERTIFICATE OF RANCHO BP,LLC The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof. (1) The undersigned is duly authorized to execute this Certificate on behalf of Rancho BP, LLC, a Delaware limited liability company(the "Property Owner"). (2) This Certificate is delivered in connection with the offering and sale of the bonds captioned above (the "Bonds"). (3) In connection with the offering and sale of the Bonds, there has been prepared a preliminary official statement, dated the date of this Certificate (the "Preliminary Official Statement"), setting forth certain information concerning, among other things, the Bonds, the Property Owner; the organization, activities, properties and financial condition of the Property Owner; and the Property Owner's property within Improvement Area No. 2 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area"). (4) The sections in the Preliminary Official Statement that describe or relate to the Property Owner (including "INTRODUCTION Continuing Disclosure," "IMPROVEMENT AREA NO. 2 - Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants-in-Common") contain no untrue statement of a material fact and do not omit any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. (5) The Property Owner has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (6) The Property Owner has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (7) The Property Owner is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by the Property Owner or the ability of the Property Owner to pay special taxes levied in the Improvement Area (the "Special Taxes"). B-2-1 DOCSOC/1628871 v2/022245-0268 P806 (8) The Property Owner is solvent, and no proceedings are pending or, to its knowledge, threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (9) There is no litigation or administrative proceeding of any nature in which the Property Owner has been served, or to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership and operation of the property owned by the Property Owner, or the ability of the Property Owner to pay the Special Taxes. The information contained in this Certificate that is subject to the qualifier"to its knowledge" was obtained through (i) interviews with the officers and responsible employees of the Property Owner as the undersigned has reasonably determined are likely, in the ordinary course of his or her respective duties, to have knowledge of the matters set forth in this Certificate, and (ii) reviews of documents that were reasonably necessary for the undersigned to obtain knowledge of the matters set forth in this Certificate. Dated: [POS date] Rancho BP, LLC, a Delaware limited liability company By: Name: Title: B-2-2 DOCSOC/1628871 v2/022245-0268 P807 EXHIBIT C-1 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 CLOSING CERTIFICATE OF FOOTHILL CROSSING. LLC The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga (the "Issuer")of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof. (1) The undersigned is duly authorized to execute this Certificate on behalf of Foothill Crossing, LLC, a California limited liability company(the "Property Owner"). (2) The Property Owner is duly authorized to execute, deliver and perform the Continuing Disclosure Certificate (Property Owner) dated , 2013 in connection with the issuance of the Bonds(the "Property Owner Disclosure Certificate"). (3) The Property Owner has duly executed and delivered the Property Owner Disclosure Certificate. (4) The Property Owner has full power and authority to own its property located within Improvement Area No. 2 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "Improvement Area") and carry on its business as presently conducted and as described in the Final Official Statement. (5) Except as disclosed in the Final Official Statement, no event has occurred since the date of the Preliminary Official Statement that has materially and adversely affected or is reasonably expected to materially and adversely affect the business, properties, operations or financial condition of the Property Owner. (6) Except as disclosed in the Final Official Statement, the Property Owner has not submitted an application for, nor received actual notice of, (i) the formation or authorization of any assessment district or community facilities district that would include any portion of the land of the Property Owner within the Improvement Area, or (ii) the authorization or issuance of any debt secured by a special tax to be levied on any portion of the land of the Property Owner within the Improvement Area, other than the special taxes to be levied by the Issuer in the Improvement Area (the "Special Taxes"). (7) The representations and warranties made by the Property Owner in the l Ob-5 Certificate of Foothill Crossing, LLC are true and correct in all material respects on the Closing Date, with the same effect as if made on the Closing Date. If at any time subsequent hereto and within 25 days after the date of this Certificate any such statements in the Official Statement become untrue, the Property Owner agrees to immediately notify the Issuer and Stifel,Nicolaus& Company, Incorporated, the underwriter of the Bonds. C-1-1 DOCSOC/1628871 v2/022245-0268 P808 (8) The Property Owner covenants that, while the Bonds are outstanding, the Property Owner will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body which in any way seeks to challenge or overturn the Improvement Area, the levy of the Special Tax in accordance with the rate and method of apportionment of special tax for the Improvement Area (the "Rate and Method") or the validity of the Bonds or the proceedings leading up to their issuance. The foregoing covenant shall not prevent the Property Owner from bringing an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method, so long as any such action or suit does not seek to interfere, or have the effect of interfering, with the levy and collection of the Special Tax in amounts and at times sufficient to pay the principal of and interest on the Bonds when due. Dated: [closing date] FOOTHILL CROSSING, LLC By: GMS Holdings, Inc., a California corporation Its Manager By: Gary M. Safady, President C-1-2 DOCSOC/1628871 v2/022245-0268 P809 EXHIBIT C-2 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 CLOSING CERTIFICATE OF RANCHO BP. LLC The undersigned, in connection with the issuance, sale and delivery by the City of Rancho Cucamonga Communities Facilities District No. 2003-01 (the "Issuer") of the bonds captioned above (the "Bonds"), hereby certifies as follows as of the date hereof: (1) The undersigned is duly authorized to execute this Certificate on behalf of Rancho BP, LLC, a Delaware limited liability company (the "Property Owner"). (2) The Property Owner is duly authorized to execute, deliver and perform the Continuing Disclosure Certificate (Property Owner) dated , 2013 in connection with the issuance of the Bonds (the "Property Owner Disclosure Certificate"). (3) The Property Owner has duly executed and delivered the Property Owner Disclosure Certificate. (4) The Property Owner has full power and authority to own its property located within Improvement Area No. 2 of the City of Rancho Cucamonga Community Facilities District No. 2003-01 .(the "Improvement Area") and carry on its business as presently conducted. (5) Except as disclosed in the final official statement relating to the Bonds, dated 2013 (the "Final Official Statement'), no event has occurred since the date of the preliminary official statement relating to the Bonds, dated , 2013, that has materially and adversely affected or is reasonably expected to materially and adversely affect the business, properties, operations or financial condition of the Property Owner. (6) Except as disclosed in the Final Official Statement, the Property Owner has not submitted an application for, nor received actual notice of, (i) the formation or authorization of any assessment district or community facilities district that would include any portion of the land of the Property Owner within the Improvement Area, or (ii) the authorization or issuance of any debt secured by a special tax to be levied on any portion of the land of the Property Owner within the Improvement Area, other than the special taxes to be levied by the Issuer in the Improvement Area (the "Special Taxes"). (7) The representations and warranties made by the Property Owner in the 1 Ob-5 Certificate of Rancho BP, LLC are true and correct in all material respects on the Closing Date, with the same effect as if made on the Closing Date. If at any time subsequent hereto and within 25 days after the date of this Certificate any statements related to the Property Owner, property of the Property Owner contained in the Improvement Area or representations made by the Property Owner in the sections of the Final Official Statement entitled "INTRODUCTION - Continuing Disclosure," "IMPROVEMENT AREA NO. 2 - C-2-1 DOCSOC/1628871 v2/022245-0268 P810 Major Landowners - Zone 2 Land Ownership," "SPECIAL RISK FACTORS - Concentration of Property Ownership" and "CONTINUING DISCLOSURE - Continuing Disclosure Certificate of Tenants-in-Common" become untrue, the Property Owner agrees to immediately notify the Issuer and Stifel,Nicolaus & Company, Incorporated, the underwriter of the Bonds. (8) The Property Owner covenants that, while the Bonds are outstanding, the Property Owner will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body which in any way seeks to challenge or overturn the Improvement Area, the levy of the Special Tax in accordance with the rate and method of apportionment of special tax for the Improvement Area (the "Rate and Method") or the validity of the Bonds or the proceedings leading up to their issuance. The foregoing covenant shall not prevent the Property Owner from bringing an action or suit contending that the Special Tax has not been levied in accordance with the methodology contained in the Rate and Method. Dated: [closing date] [SIGNATURE BLOCK OF RANCHO BP, LLC] By: Name: Title: C-2-2 DOCSOC/1628871 v2/022245-0268 P811 6-20-13 Jones Hall Draft `o PRELIMINARY OFFICIAL STATEMENT DATED ' 2013 � c 0 y NEW ISSUE-BOOK ENTRY ONLY NOT RATED c q m° Assuming compliance with certain covenants and provisions of the Internal Revenue Code of 1986, in the opinion of mBond Counsel, interest on the 2013 Bonds will not be includable in gross income for federal income tax purposes although it ui n may be includable in the calculation for certain taxes. Also in the opinion of Bond Counsel, interest on the 2013 Bonds will be exempt from State personal income taxes. See "TAX MATTERS." o� C $2,835,000 cD CITY OF RANCHO CUCAMONGA E o COMMUNITY FACILITIES DISTRICT NO. 2003-01 a ,3, IMPROVEMENT AREA NO. 2 t y SPECIAL TAX REFUNDING BONDS, SERIES 2013 0 0 m y� Dated: Date of Issuance Due: September 1, as shown on inside cover N N -°-� The City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District"), with respect to its a Improvement Area No. 2 ("Improvement Area No. 2"), is issuing the above-captioned bonds (the "2013 Bonds")to (i) refund in full the City of Rancho Cucamonga Community Facilities District No.2003-01 Improvement Area No. 2 Special Tax Bonds, P ° Series 2003-B (the "Prior Bonds"); (ii) fund a reserve fund for the 2013 Bonds; and (iii) pay the costs of issuing the 2013 o Bonds. See "PLAN OF REFUNDING." The Prior Bonds were issued by the City to finance various public infrastructure s improvements located in the City. D U 3 The 2013 Bonds are being issued pursuant to a Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent m o Agreement"), by and between the District and Wells Fargo Bank, National Association, as fiscal agent(the"Fiscal Agent"). E °c The 2013 Bonds are payable from the proceeds of an annual Special Tax (as defined in this Official Statement) being E levied on property located within Improvement Area No. 2 (see "IMPROVEMENT AREA NO. 2"), and from certain funds o � pledged under the Fiscal Agent Agreement. The Special Tax is being levied according to a rate and method of m apportionment of Special Taxes approved in 2003 by the then-qualified electors of Improvement Area No. 2. See E "SECURITY FOR THE 2013 BONDS-Special Taxes"and Appendix B-"Rate and Method." ffi.N nm Interest on the 2013 Bonds is payable on March 1 and September 1 of each year, commencing on March 1, 2014. The 2013 Bonds will be issued in book-entry form only and, when delivered, will be registered in the name of Cede & Co., as m nominee of the Depository Trust Company, New York, New York("DTC"),which will act as securities depository for the 2013 Z'= Bonds. Individual purchases of the 2013 Bonds will be made in book-entry form only. Purchasers of the 2013 Bonds will not receive physical certificates representing their ownership interests in the 2013 Bonds purchased. The 2013 Bonds will be P2 m issued in integral multiples of$5,000. Principal of and interest on the 2013 Bonds are payable directly to DTC by the Fiscal c h Agent. Upon receipt of payments of principal and interest, DTC will in turn distribute such payments to the beneficial owners of the 2013 Bonds. See"THE 2013 BONDS"and Appendix F-"DTC and the Book-Entry Only System." t m a The "Record Date" of the 2013 Bonds is the fifteenth day of the month next preceding the month of the applicable Interest Payment Date. o The 2013 Bonds are subject to optional redemption and mandatory redemption from Special Tax Prepayments. See y "THE 2013 BONDS—Redemption." E .� Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax 5 o h Revenues may be issued under the Fiscal Agent Agreement. D O NONE OF THE FAITH AND CREDIT OF THE DISTRICT, IMPROVEMENT AREA NO. 2, THE CITY OR THE STATE `c E OF CALIFORNIA OR OF ANY OF THEIR RESPECTIVE POLITICAL SUBDIVISIONS IS PLEDGED TO THE PAYMENT OF THE 2013 BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE PAYMENT OF E� THE 2013 BONDS. THE 2013 BONDS ARE NEITHER GENERAL OR SPECIAL OBLIGATIONS OF THE DISTRICT OR rn° ° IMPROVEMENT AREA NO. 2 NOR GENERAL OBLIGATIONS OF THE CITY, BUT ARE LIMITED OBLIGATIONS OF THE a m DISTRICT WITH RESPECT TO IMPROVEMENT AREA NO. 2, PAYABLE SOLELY FROM CERTAIN AMOUNTS PLEDGED THEREFOR UNDER THE FISCAL AGENT AGREEMENT, AS MORE FULLY DESCRIBED IN THIS OFFICIAL Z m c STATEMENT. c ° This cover page contains certain information for quick reference only. Investors should read the entire Official Statement @ o to obtain information essential to the making of an informed investment decision with respect to the 2013 Bonds. The r1 purchase of the 2013 Bonds involves significant risks, and the 2013 Bonds are not appropriate investments for all types of N `w o 'o investors. See "SPECIAL RISK FACTORS" in this Official Statement for a discussion of certain risk factors that should be Preliminary; subject to change. P812 considered, in addition to the other matters set forth in this Official Statement, in evaluating the investment quality of the 2013 Bonds. The 2013 Bonds are offered when, as and if issued, subject to approval as to their legality by Best Best& Krieger LLP, San Diego, California, Bond Counsel, and certain other conditions. Certain legal matters with respect to the 2013 Bonds will be passed upon for the District by the City Attorney, and for the District by Jones Hall,A Professional Law Corporation, San Francisco, California, acting as Disclosure Counsel. Certain legal matters will be passed upon for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. It is anticipated that the 2013 Bonds in definitive form will be available for delivery to DTC on or about July_, 2013. [Stifel logo] The date of this Official Statement is ,2013. P813 MATURITY SCHEDULE $_Serial Bonds; CUSIP' Prefix 752117 Maturity Date Principal Interest CUSIP (September 1) Amount Rate Yield Suffix' Copyright 2013,American Bankers Association. CUSIP data is provided by Standard&Poor's CUSIP Service Bureau,a division of The McGraw-Hill Companies,Inc. None of the District,the City or the Underwriter assumes any responsibility for the accuracy of the CUSIP data. P814 CITY OF RANCHO CUCAMONGA City Council L. Dennis Michael, Mayor Sam Spagnolo, Mayor Pro Tem William J. Alexander, Council Member Marc Steinorth, Council Member Diane Williams, Council Member Other Elected Officials James C. Frost, City Treasurer Janice C. Reynolds, City Clerk City Staff John R. Gillison, City Manager Linda D. Daniels, Assistant City Manager Tamara L. Layne, Finance Director Lori E. Sassoon, Deputy City Manager/Administrative Services Ingrid Y. Bruce, GIS/Special Districts Manager James L. Markman, Esq., City Attorney PROFESSIONAL SERVICES Bond Counsel Best Best& Krieger LLP San Diego, California Disclosure Counsel Jones Hall, A Professional Law Corporation San Francisco, California Financial Advisor Fieldman, Rolapp &Associates Irvine, California Special Tax Administrator David Taussig &Associates, Inc. Newport Beach, California Verification Agent Causey Demgen & Moore Inc. Denver, Colorado Fiscal Agent and Escrow Bank Wells Fargo Bank, National Association Los Angeles, California P815 GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT The information contained in this Official Statement has been obtained from sources that are believed to be reliable. No representation, warranty or guarantee, however, is made by the Underwriter as to the accuracy or completeness of any information in this Official Statement, including, without limitation, the information contained in the Appendices, and nothing contained in this Official Statement should be relied upon as a promise or representation by the Underwriter. None of the District, City or Underwriter has authorized any dealer, broker, salesperson or other person to give any information or make any representations with respect to the offer or sale of the 2013 Bonds other than as contained in this Official Statement. If given or made, any such information or representations must not be relied upon as having been authorized by the District, City or Underwriter. The information and expressions of opinion in this Official Statement are subject to change without notice, and neither the delivery of this Official Statement nor any sale of the 2013 Bonds shall under any circumstances create any implication that there has been no change in the affairs of any party described in this Official Statement, or in the status of any property described in this Official Statement, subsequent to the date as of which such information is presented. This Official Statement and the information contained in this Official Statement are subject to amendment without notice. The 2013 Bonds may not be sold, and no offer to buy the 2013 Bonds may be accepted, prior to the time the Official Statement is delivered in final form. Under no circumstances shall this Official Statement constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the 2013 Bonds in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. When used in this Official Statement, in any continuing disclosure by the District or City, in any press release, or in any oral statement made with the approval of an authorized officer of the District or City or any other entity described or referenced in this Official Statement, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," "forecast," "expect," "intend" and similar expressions identify"forward looking statements"within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. Any forecast is subject to such uncertainties. Inevitably, some assumptions used to develop the forecasts will not be realized, and unanticipated events and circumstances may occur. Therefore, there are likely to be differences between forecasts and actual results,and those differences may be material. All summaries of the documents referred to in this Official Statement are qualified by the provisions of the respective documents summarized and do not purport to be complete statements of any or all of such provisions. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or the completeness of such information. In connection with the offering of the 2013 Bonds, the Underwriter may overallot or effect transactions that stabilize or maintain the market prices of the 2013 Bonds at levels above that which might otherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time. The 2013 Bonds have not been registered under the Securities Act of 1933, as amended (the "Securities Act'), in reliance upon an exemption from the registration requirements contained in the Securities Act. The 2013 Bonds have not been registered or qualified under the securities laws of any state. The City maintains an Internet website, but the information it contains is not incorporated in this Official Statement. P816 [maps to come] P817 TABLE OF CONTENTS INTRODUCTION ........................................1 Land Owners ........................................ 28 General....................................................1 Delinquencies ....................................... 34 Authority for Issuance..............................1 Direct and Overlapping Governmental The 2013 Bonds......................................2 Obligations........................................ 36 Security for the 2013 Bonds....................2 Scheduled Debt Service Coverage....... 39 Reserve Fund..........................................3 SPECIAL RISK FACTORS.......................42 Improvement Area No. 2.........................3 Concentration of Property Ownership...42 Limited Obligation....................................4 Risks Associated with Commercial No Additional Bonds................................5 Real Estate Properties......................42 Bondowners' Risks..................................5 Impact of Zone Allocation .....................43 Continuing Disclosure .............................5 Payment of the Special Tax Is Not a Other Information ....................................5 Personal Obligation...........................44 PLAN OF REFUNDING..............................6 No General Obligation of the City or Redemption of Prior Bonds.....................6 the District.........................................44 Estimated Sources and Uses of Funds...6 Property Value......................................44 THE 2013 BONDS......................................7 Exempt Properties ................................45 Authority for Issuance..............................7 Parity Taxes and Special Assessments 45 General Provisions..................................7 Insufficiency of Special Taxes ..............46 Redemption.............................................8 Tax Delinquencies ................................ 46 Transfer or Exchange of 2013 Bonds......9 Risks Associated with Private Loan...... 47 Discontinuance of DTC Services...........10 Bankruptcy Delays................................47 Scheduled Debt Service........................11 Proceeds of Foreclosure Sales............. 47 SECURITY FOR THE 2013 BONDS........12 Natural Disasters ..................................48 General..................................................12 Hazardous Substances......................... 50 Limited Obligation..................................12 Disclosure to Future Purchasers ......... 50 Special Taxes........................................12 FDIC/Federal Government Interests in Special Tax Fund ..................................13 Properties.......................................... 51 Summary of Rate and Method ..............15 No Acceleration Provision..................... 52 Reserve Fund........................................18 Taxability Risk....................................... 52 Covenant for Superior Court Enforceability of Remedies................... 53 Foreclosure........................................18 No Secondary Market........................... 53 No Teeter Plan......................................19 Proposition 218..................................... 53 Investment of Moneys...........................20 Ballot Initiatives..................................... 55 No Additional Bonds..............................20 TAX MATTERS ........................................ 55 IMPROVEMENT AREA NO. 2..................21 LEGAL MATTERS.................................... 56 Location and Description of NO RATING ............................................. 56 Improvement Area No. 2 ...................21 LITIGATION ............................................. 56 Land Use Distribution............................22 UNDERWRITING..................................... 57 Assessed Property Values....................23 CONTINUING DISCLOSURE .................. 57 Value-to-Debt Burden Ratio..................24 MISCELLANEOUS................................... 59 APPENDIX A CITY OF RANCHO CUCAMONGA GENERAL DEMOGRAPHIC INFORMATION APPENDIX B RATE AND METHOD APPENDIX C SUMMARY OF THE FISCAL AGENT AGREEMENT APPENDIX D FORM OF OPINION OF BOND COUNSEL APPENDIX E FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE APPENDIX F FORM OF PROPERTY OWNER CONTINUING DISCLOSURE CERTIFICATE APPENDIX G DTC AND THE BOOK-ENTRY ONLY SYSTEM APPENDIX H FOOTHILL CROSSING LLC INCOME STATEMENT (2011 AND 2012) P818 OFFICIAL STATEMENT $2,835,000 CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 INTRODUCTION This introduction is not a summary of this Official Statement and is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement by those interested in purchasing the 2013 Bonds. The sale and delivery of 2013 Bonds to potential investors is made only by means of the entire Official Statement. Certain capitalized terms used in this Official Statement and not defined have the meaning set forth in Appendix C– "Summary of the Fiscal Agent Agreement—Definitions"and in Appendix B– "Rate and Method." General The purpose of this Official Statement, which includes the cover page, the inside cover page, the table of contents and the attached appendices (the "Official Statement'), is to provide certain information concerning the issuance of the above-captioned bonds (the "2013 Bonds"). The 2013 Bonds are being issued by the City of Rancho Cucamonga Community Facilities District No. 2003-01 (the "District') with respect to its Improvement Area No. 2 ('Improvement Area No. 2"), to (i) refund in full the City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Special Tax Bonds, Series 2003-B currently outstanding in the aggregate principal amount of $2,765,000 (the 'Prior Bonds"); (ii) fund a reserve fund for the 2013 Bonds; and (iii) pay the costs of issuing the 2013 Bonds. See "PLAN OF REFUNDING." The Prior Bonds were issued to finance various public infrastructure improvements (the "Improvements") within the City of Rancho Cucamonga, California (the "City"). Authority for Issuance General. The District and Improvement Area No. 2 were formed under the authority of the Mello-Roos Community Facilities Act of 1982, as amended, commencing at Section 53311, et seq., of the California Government Code (the "Act'), which was enacted by the California Legislature to provide an alternative method of financing certain public capital facilities and services, especially in developing areas of the State. The Act authorizes local governmental entities to establish community facilities districts as legally constituted governmental entities within defined boundaries, with the legislative body of the local applicable governmental entity acting on behalf of the district. Subject to approval by at least a two-thirds vote of the votes cast Preliminary;subject to change. P819 by the qualified electors within a district and compliance with the provisions of the Act, the legislative body may issue bonds for the community facilities district established by it and may levy and collect a special tax within such district to repay such bonds. Bond Authority. The 2013 Bonds are authorized to be issued pursuant to the Act, a resolution adopted on July 3, 2013 by the City Council of the City (the "City Council") acting as the legislative body of the District, and the Fiscal Agent Agreement dated as of July 1, 2013 (the "Fiscal Agent Agreement'), between the District and Wells Fargo Bank, National Association, as fiscal agent (the "Fiscal Agent'). For more detailed information about the formation of the District and Improvement Area No. 2, the authority for issuance of the Prior Bonds and the authority for issuance of the 2013 Bonds, see "THE 2013 BONDS –Authority for Issuance." The 2013 Bonds General. The 2013 Bonds will be issued only as fully registered bonds, in integral multiples of $5,000, and will bear interest at the rates per annum and will mature on the dates and in the principal amounts set forth on the inside cover page of this Official Statement. The 2013 Bonds will be dated the date of their issuance and interest on the 2013 Bonds, will be payable on March 1 and September 1 of each year (individually an 'Interest Payment Date"), commencing March 1, 2014. See "THE 2013 BONDS." Book Entry-Only System. The 2013 Bonds will be issued in book-entry form only and, when delivered, will be registered in the name of Cede & Co., as nominee of the Depository Trust Company, New York, New York ("DTC"), which will act as securities depository for the 2013 Bonds. See "THE 2013 BONDS—General Provisions." Redemption Prior to Maturity. The 2013 Bonds are subject to optional redemption and mandatory redemption from Special Tax prepayments. See `THE 2013 BONDS – Redemption." Security for the 2013 Bonds Pledge Under the Fiscal Agent Agreement. Pursuant to the Fiscal Agent Agreement, the 2013 Bonds are secured by a first pledge of all of the Special Tax Revenues (other than, in each Fiscal Year, up to the first $_,000 of Special Tax Revenues that may be deposited into the Administrative Expense Fund) and all moneys deposited in the Bond Fund and, until disbursed in accordance with the Fiscal Agent Agreement, in the Special Tax Fund, except for moneys on deposit in the Penalties and Interest Account (which constitute any penalties or interest in excess of the interest payable on the 2013 Bonds collected in connection with delinquent Special Taxes). The 2013 Bonds are further secured by a first pledge of all monies deposited into the Reserve Fund. "Special Tax Revenues," as defined in the Fiscal Agent Agreement, means the proceeds of the Special Taxes received by the District including any scheduled payments and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest and penalties thereon, but does not include interest and penalties, if any, collected in connection with delinquent Special Taxes. The Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2013 Bonds in accordance with the Fiscal Agent Agreement and the Act until 2 P820 all the 2013 Bonds have been paid and retired or defeased. See "SECURITY FOR THE 2013 BONDS—Special Taxes" and Appendix B – "Rate and Method." Amounts in the Administrative Expense Fund and the Costs of Issuance Fund, each of which is established under the Fiscal Agent Agreement, are neither pledged to nor available for the repayment of the 2013 Bonds. Proceeds of the 2013 Bonds and other amounts deposited to the Escrow Fund under the Escrow Agreement (see "PLAN OF REFUNDING – Redemption of Prior Bonds") are not pledged to, and will not be available for, the payment of the 2013 Bonds. Special Taxes; Rate and Method. The Special Taxes to be used to pay debt service on the 2013 Bonds will be levied in accordance with the 'Rate and Method" of apportionment of Special Tax (as described under the heading "THE 2013 BONDS – Authority for Issuance"). "Special Taxes" are those taxes levied on the Taxable Property within Improvement Area No. 2 pursuant to the Rate and Method and the Fiscal Agent Agreement. The Rate and Method includes the following relevant definitions, among others: "Taxable Property" is defined all of the parcels within the boundaries of Improvement Area No. 2 that are not exempt from the Special Tax pursuant to law or the Rate and Method. "Developed Property" is defined as, for each Fiscal Year, all Taxable Property which (i) was within a Final Map that was recorded prior to January 1 of the previous Fiscal Year, and (ii) for which a building permit for new construction was issued after January 1, 2002 but prior to January 1 of the previous Fiscal Year. "Undeveloped Property" is defined as, for each Fiscal Year, all Taxable Property not classified as Developed Property. Limitations. The Improvements are not pledged as collateral for the 2013 Bonds. The proceeds of condemnation or destruction of any of the Improvements are not pledged to pay the debt service on the 2013 Bonds. In the event that the Special Taxes are not paid when due, the only sources of funds available to repay the 2013 Bonds are amounts held by the Fiscal Agent under the Fiscal Agent Agreement in the Bond Fund, the Special Tax Fund and the Reserve Fund, and the proceeds, if any, from foreclosure sales of parcels with delinquent Special Taxes. Reserve Fund The Fiscal Agent Agreement establishes a Reserve Fund to be held by the Fiscal Agent as a reserve for the payment of principal of and interest on the 2013 Bonds. The Reserve Fund is required to be funded in an amount equal to the "Reserve Requirement," which means on any date in any Bond Year the lesser of (i) 10% of the stated principal amount of the 2013 Bonds, (ii) Maximum Annual Debt Service on the 2013 Bonds or (iii) 125% of average Annual Debt Service on the 2013 Bonds, as determined by the District. The Reserve Requirement as of the date of issuance of the 2013 Bonds will be $ Improvement Area No. 2 Two Zones. Improvement Area No. 2 consists of approximately 82 gross acres (48.85 acres of Taxable Property) that are primarily built-out. The Rate and Method divides the Taxable Property within Improvement Area No. 2 into two zones: 'Zone 1" (62.95 gross acres; 31.66 3 P821 acres of Taxable Property) and "Zone 2" (19.13 gross acres; 17.19 acres of Taxable Property), which are referred to in this Official Statement as a "Zone". The Rate and Method allocates a portion of the outstanding 2013 Bonds to each Zone in Improvement Area No. 2 for purposes of determining the amount of the Special Taxes to be levied. Zone Allocations. Each Zone is responsible only for debt service on the percentage of outstanding 2013 Bonds allocated to it (its "Zone Allocation"), and Special Taxes may not be levied in one Zone in order to provide for amounts to pay debt service on outstanding 2013 Bonds allocated to another. The Zone Allocations are specified in the Rate and Method and discussed in the paragraphs that follow. Zone 1 Allocation. The Zone Allocation for Zone 1 is 37.80% of the initial principal amount of the 2013 Bonds (or $1,079,190 ). On the 2012-13 property tax roll, the San Bernardino County ("County") Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 1 (see "IMPROVEMENT AREA NO. 2") at$37,678,406. As of January 1, 2013, Zone 1 contained 12 developed commercial parcels, designated as Developed Property, that were responsible for the entire Special Tax levy in the Zone. All 12 parcels are owned by Foothill Crossing, LLC and developed as an open-air mall. There are no parcels of Undeveloped Property in Zone 1. Zone 2 Allocation. The Zone Allocation for Zone 2 is 62.20% of the initial principal amount of the 2013 Bonds (or $1,775,810). On the 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 2 (see "IMPROVEMENT AREA NO. 2") at $40,784,245. As of January 1, 2013, Zone 2 contained a single commercial parcel that was responsible for the entire Special Tax levy in the Zone. The parcel is owned by Rancho BP, LLC and operated as a Bass Pro Shop. There are no parcels of Undeveloped Property in Zone 2. The value of individual parcels varies significantly. In addition, County assessed values may not reflect current market values. No recent independent appraisal of the property subject to the levy of Special Taxes has been conducted in connection with the 2013 Bonds, and no assurance can be given that should Special Taxes levied on one or more of the parcels become delinquent, and should the delinquent parcels be offered for sale at a judicial foreclosure sale, that any bid would be received for the property or, if a bid is received, that such bid would be sufficient to pay such parcel's delinquent Special Taxes. See "IMPROVEMENT AREA NO. 2," "SPECIAL RISK FACTORS—Property Value" and "SPECIAL RISK FACTORS—Insufficiency of Special Taxes." Limited Obligation NONE OF THE FAITH AND CREDIT OF THE DISTRICT, IMPROVEMENT AREA NO. 2, THE CITY OR THE STATE OF CALIFORNIA OR OF ANY OF THEIR RESPECTIVE POLITICAL SUBDIVISIONS IS PLEDGED TO THE PAYMENT OF THE 2013 BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER TAXES ARE PLEDGED TO THE Preliminary; subject to change. 4 P822 PAYMENT OF THE 2013 BONDS. THE 2013 BONDS ARE NEITHER GENERAL OR SPECIAL OBLIGATIONS OF THE DISTRICT OR IMPROVEMENT AREA NO. 2 NOR GENERAL OBLIGATIONS OF THE CITY, BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT WITH RESPECT TO IMPROVEMENT AREA NO. 2 PAYABLE SOLELY FROM CERTAIN AMOUNTS PLEDGED THEREFOR UNDER THE FISCAL AGENT AGREEMENT, AS MORE FULLY DESCRIBED IN THIS OFFICIAL STATEMENT. No Additional Bonds Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax Revenues may be issued under the Fiscal Agent Agreement. Bondowners' Risks Certain events could affect the ability of the District to pay the principal of and interest on the 2013 Bonds when due. Except for the Special Taxes, no other taxes are pledged to the payment of the 2013 Bonds. See "SPECIAL RISK FACTORS" for a discussion of certain factors that should be considered in evaluating an investment in the 2013 Bonds. The purchase of the 2013 Bonds involves significant risks, and the 2013 Bonds are not appropriate investments for all types of investors. Continuing Disclosure For purposes of complying with Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934, as amended (the "Rule"), the City, on behalf of itself and the District, has agreed to provide, or cause to be provided, to the Municipal Securities Rulemaking Board (the "MSRB") certain annual financial information and operating data and notice of certain significant events. In addition, Foothill Crossing, LLC, the owner of all of the property in Zone 1, and Rancho BP, LLC, the owner of all of the property in Zone 2, have each agreed to provide, or cause to be provided, to the MSRB certain information relating to itself and the parcels it owns within Improvement Area No. 2 and notice of certain significant events. The City, Foothill Crossing, LLC, and Rancho BP, LLC will each make the covenants described above in continuing disclosure certificates, dated the date of delivery of the 2013 Bonds, in order to assist the Underwriter in complying with the Rule. See "CONTINUING DISCLOSURE" for more information about these certificates (the forms of which are attached to this Official Statement as Appendix E and Appendix F) or the parties' compliance with their respective existing continuing disclosure obligations. Other Information This Official Statement speaks only as of its date, and the information contained in this Official Statement is subject to change without notice. Except where otherwise indicated, all information contained in this Official Statement has been provided by the City on behalf of the District. Copies of the Fiscal Agent Agreement and certain other documents referenced in this Official Statement are available for inspection at the office of, and (upon written request and 5 P823 payment to the City of a charge for copying, mailing and handling) are available for delivery from, the City Clerk of the City, 10500 Civic Center Drive, Rancho Cucamonga, California 91730. PLAN OF REFUNDING Redemption of Prior Bonds A portion of the proceeds of the sale of the 2013 Bonds, together with available funds held under the Fiscal Agent Agreement, dated as of July 1, 2003, with respect to the Prior Bonds (the "2003 Fiscal Agent Agreement'), will be deposited in an escrow account (the "Escrow Fund") held by Wells Fargo Bank, National Association, as escrow bank (the "Escrow Bank") pursuant to an Escrow Agreement dated as of July 1, 2013, among the City, the District and the Escrow Bank. The moneys in the Escrow Fund will be held uninvested or invested in federal securities. The moneys in the Escrow Fund will be applied to defease and refund all of the outstanding Prior Bonds. Amounts in the escrow fund will be sufficient, without reinvestment, to fully pay the Prior Bonds on September 1, 2013, at a redemption price of 100% of the principal amount thereof plus accrued interest to the redemption date. Upon such irrevocable deposit with the Escrow Bank and in accordance with the Escrow Agreement, the Prior Bonds will be legally defeased and will no longer be entitled to the benefits of, or be secured by, the 2003 Fiscal Agent Agreement or any pledge of, or lien on, the Special Taxes levied in Improvement Area No. 2. Amounts deposited in the Escrow Fund are not in any way available to pay debt service on the 2013 Bonds. Estimated Sources and Uses of Funds The sources and uses of funds in connection with the 2013 Bonds are expected to be as follows: Principal of 2013 Bonds Plus/Less: Original Issue Premium Discount Amounts relating to the Prior Bonds Less: Underwriter's Discount Total Sources Deposit to Escrow Fund') Deposit to Reserve Fund(2) Deposit to Costs of Issuance Fund(') Total Uses (1) See"—Redemption of Prior Bonds." (2) Equal to the initial Reserve Requirement. See "SECURITY FOR THE 2013 BONDS—Reserve Fund." (3) Costs of issuance include, without limitation, the City's transaction fee, Fiscal Agent fees and expenses; Financial Advisor fees and expenses; Bond Counsel, Disclosure Counsel and other legal 6 P824 fees; Special Tax Administrator fees and expenses; Verification Agent fees; Escrow Bank fees and expenses; and printing costs. THE 2013 BONDS Authority for Issuance Pursuant to the Act, on February 19, 2003, the City Council adopted Resolution No. 03- 031 establishing the District and designating Improvement Area No. 2 (the `Resolution of Formation"). Also on February 19, 2003, the City Council adopted Resolution No. 03-032, declaring the necessity to incur a bonded indebtedness of$4,000,000 within Improvement Area No. 2. On February 19, 2003, the then-eligible landowner voters of Improvement Area No. 2, by more than a two-thirds majority, authorized the issuance of bonded indebtedness to finance the authorized public facilities, and approved the 'Rate and Method of Apportionment for Community Facilities District No. 2003-01 of the City of Rancho Cucamonga Improvement Area No. 2" (the "Rate and Method"), a copy of which is attached to this Official Statement as Appendix B. The 2013 Bonds are authorized to be issued pursuant to the Act, Resolution No. adopted on July 3, 2013, by the City Council, acting as the legislative body of the District, and the Fiscal Agent Agreement. The Special Taxes to be used to pay debt service on the 2013 Bonds will be levied in accordance with the Rate and Method. General Provisions The 2013 Bonds will be issued only as fully registered 2013 Bonds, in integral multiples of$5,000, and will bear interest at the rates per annum and will mature on the dates set forth on the inside cover page of this Official Statement. The 2013 Bonds will be dated the date of their issuance and interest will be payable on each Interest Payment Date, commencing March 1, 2014. Each Bond will bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (i) it is authenticated on an Interest Payment Date, in which event it will bear interest from such date of authentication; or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it will bear interest from such Interest Payment Date; or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it will bear interest from the Closing Date; provided, however, that if at the time of authentication of a 2013 Bond, interest is in default on it, such 2013 Bond will bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment. The Record Date for the 2013 Bonds is defined in the Fiscal Agent Agreement as the fifteenth day of the month next preceding the month of the applicable Interest Payment Date. The 2013 Bonds will be payable both as to principal and interest, and as to any premiums upon the redemption thereof, in lawful money of the United States of America. The principal of the 2013 Bonds and any premiums due upon the redemption thereof will be payable upon presentation and surrender at the principal corporate trust office of the Fiscal Agent. 7 P825 Interest with respect to each Bond will be computed using a year of 360 days comprised of twelve 30-day months. The 2013 Bonds will be issued in book-entry form only and, when delivered, will be registered in the name of Cede & Co., as nominee of DTC, which will act as securities depository for the 2013 Bonds. Individual purchases of the 2013 Bonds will be made in book- entry form only. Purchasers of the 2013 Bonds will not receive physical certificates representing their ownership interests in the 2013 Bonds purchased. Principal and interest payments represented by the 2013 Bonds are payable directly to DTC by the Fiscal Agent. Upon receipt of payments of principal and interest, DTC will in turn distribute such payments to the beneficial owners of the 2013 Bonds. See Appendix G – "DTC and the Book-Entry Only System." So long as the 2013 Bonds are registered in the name of Cede & Co., as nominee of DTC, references in this Official Statement to the owners shall mean Cede & Co., and shall not mean the purchasers or Beneficial Owners of the 2013 Bonds. Redemption Optional Redemption. The 2013 Bonds may be redeemed at the option of the District from any source of funds other than prepayment of Special Taxes, prior to their stated maturity, as a whole or in part (in integral multiples of $5,000) on any Interest Payment Date, from such maturities as are selected by the District, and by lot within a maturity, at the following redemption prices (expressed as percentages of the principal amount of the 2013 Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption: Redemption Date Redemption Price September 1, 2013 through September.1, 20_ 10_% March 1, 20_and September 1, 20_ 10_ March 1, 20_and September 1, 26- 1, 20_and any Interest Payment Date thereafter 100 Mandatory Redemption From Special Tax Prepayments. The 2013 Bonds will be subject to redemption on any Interest Payment Date, prior to maturity, as a whole or in part from such maturities, as are selected by the District, from the prepayment of Special Taxes at the following redemption prices (expressed as percentages of the principal amount of the 2013 Bonds to be redeemed), together with accrued interest thereon to the date of redemption: Redemption Date Redemption Price September 1, 2013 through September 1, 20_ 103% March 1, 20_and September 1, 20_ 102 March 1, 20_and September 1, 20 101 March 1, 26— on any Interest Payment Date thereafter 100 Purchase of 2013 Bonds In Lieu of Redemption. In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2013 Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may 2013 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase, unless a greater purchase price is permitted under the Act and the District determines that it will have sufficient amounts in the Bond Fund, following such purchase, to pay Debt Service on the 2013 Bonds. 8 P826 Selection of 2013 Bonds for Redemption. Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all the 2013 Bonds or any given portion thereof, the Fiscal Agent will select the 2013 Bonds to be redeemed, from all 2013 Bonds or such given portion thereof not previously called for redemption, among maturities as specified by the District in a written certificate delivered to the Fiscal Agent, and by lot within a maturity in any manner which the District in its sole discretion shall deem appropriate and fair. In providing such certificate, the District shall provide for the redemption of 2013 Bonds such that the remaining Debt Service payable on the 2013 Bonds shall remain level as possible. Notice of Redemption. The Fiscal Agent will cause notice of any redemption to be mailed by first class mail, postage prepaid, at least 30 days but not more than 60 days prior to the date fixed for redemption, to the respective registered Owners of any 2013 Bonds designated for redemption, at their addresses appearing on the 2013 Bond registration books in the Principal Office of the Fiscal Agent; but such mailing will not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, will not affect the validity of the proceedings for the redemption of such 2013 Bonds. Such notice will state the redemption date and the redemption price and, if less than all of the then Outstanding 2013 Bonds are to be called for redemption, will designate the 2013 Bond numbers of the 2013 Bonds to be redeemed by giving the individual 2013 Bond number of each 2013 Bond to be redeemed or will state that all 2013 Bonds between two stated 2013 Bond numbers, both inclusive, are to be redeemed or that all of the 2013 Bonds of one or more maturities have been called for redemption, will state as to any 2013 Bond called in part the principal amount thereof to be redeemed, and will require that such 2013 Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and will state that further interest on such 2013 Bonds will not accrue from and after the redemption date. Conditional Notice. The District will have the right to rescind any notice of redemption for any redemption of 2013 Bonds, as described above under "- Optional Redemption" or "- Mandatory Redemption from Special Tax Prepayments," on or prior to the date fixed for redemption. Any notice of optional redemption will be cancelled and annulled if for any reason funds will not be or are not available on the date so fixed for redemption for the payment in full of the 2013 Bonds then called for redemption, and such cancellation will not constitute an event of default under the Fiscal Agent Agreement. The Fiscal Agent will have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent will mail notice of such recession of redemption in the same manner as the original notice of redemption. Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2013 Bonds so called for redemption will have been deposited in the Bond Fund, such 2013 Bonds so called will cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice. Transfer or Exchange of 2013 Bonds So long as the 2013 Bonds are registered in the name of Cede & Co., as nominee of DTC, transfers and exchanges of 2013 Bonds will be made in accordance with DTC 9 P827 procedures. See Appendix G — "DTC and the Book-Entry Only System." If the book-entry only system for the 2013 Bonds is ever discontinued, any Bond may, in accordance with its terms, be transferred or exchanged by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form approved by the Fiscal Agent. Whenever any 2013 Bond or 2013 Bonds are surrendered for transfer or exchange, the District will execute and the Fiscal Agent will authenticate and deliver a new 2013 Bond or 2013 Bonds, for a like aggregate principal amount of 2013 Bonds of authorized denominations and of the same maturity. The Fiscal Agent will collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfers of 2013 Bonds will be required to be made (i) 15 days prior to the date established by the Fiscal Agent for selection of 2013 Bonds for redemption; (ii) with respect to a 2013 Bond after such 2013 Bond has been selected for redemption; or (iii) between the 15th day of the month next preceding any Interest Payment Date and such Interest Payment Date. Discontinuance of DTC Services DTC may determine to discontinue providing its services with respect to the 2013 Bonds at any time by giving written notice to the Fiscal Agent during any time that the 2013 Bonds are Outstanding, and discharging its responsibilities with respect to the 2013 Bonds under applicable law. The District may terminate the services of DTC with respect to the 2013 Bonds if it determines that DTC is unable to discharge its responsibilities with respect to the 2013 Bonds or that continuation of the system of book-entry transfers through DTC is not in the best interest of the Beneficial Owners. The District will mail any such notice of termination to the Fiscal Agent. Upon the termination of the services of DTC as provided in the previous paragraph, and if no substitute Depository willing to undertake the functions can be found which is willing and able to undertake such functions upon reasonable or customary terms, or if the District determines that it is in the best interest of the Beneficial Owners of the 2013 Bonds that they obtain certificated Bonds, the 2013 Bonds will no longer be restricted to being registered in the Registration Books of the Fiscal Agent in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or name the Owners designate at that time, in accordance with the Fiscal Agent Agreement. To the extent that the Beneficial Owners are designated as the transferee by the Owners, the 2013 Bonds will be delivered to such Beneficial Owners as soon as practicable in accordance with the Fiscal Agent Agreement. 10 P828 Scheduled Debt Service The following is the debt service schedule for the 2013 Bonds, assuming no optional redemption of the 2013 Bonds or redemption of the 2013 Bonds from Special Tax Prepayments: Period Ending September 1 Principal Interest Total Debt Service 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 Totals 11 P829 SECURITY FOR THE 2013 BONDS General Pursuant to the Fiscal Agent Agreement, the 2013 Bonds are secured by a first pledge of and lien upon all of the Special Tax Revenues (other than, each Fiscal Year, a maximum of $_,000 of Special Tax Revenues that may be deposited to the Administrative Expense Fund on a priority basis) and all moneys deposited in the Bond Fund and, until disbursed in accordance with the Fiscal Agent Agreement, the Special Tax Fund, except for monies on deposit in the Penalties and Interest Account. The 2013 Bonds are further secured by a first pledge of all monies deposited into the Reserve Fund. Special Tax Revenues do not include interest and penalties on foreclosure of the lien of Special Taxes in excess of the interest payable on the 2013 Bonds. The Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2013 Bonds in accordance with the Fiscal Agent Agreement and the Act until all the 2013 Bonds have been paid and retired or defeased. Amounts in the Administrative Expense Fund, the Costs of Issuance Fund and the Escrow Fund, and a maximum of the first $_,000 of Special Tax Revenues collected in any Fiscal Year that may be deposited to the Administrative Expense Fund on a priority basis, are not pledged to the repayment of the 2013 Bonds. The Improvements are not pledged as collateral for the 2013 Bonds. The proceeds of condemnation or destruction of any of the Improvements are not pledged to pay the Debt Service on the 2013 Bonds. Limited Obligation The 2013 Bonds are limited obligations of the District with respect to Improvement Area No. 2 and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Bond Fund, the Reserve Fund and the Special Tax Fund created pursuant to the Fiscal Agent Agreement. Also each Zone of Improvement Area No. 2 is responsible only for debt service on the outstanding 2013 Bonds allocated to it. See "-Summary of Rate and Method — Effect of Zone Allocation." In the event that the Special Taxes are not paid when due, the only sources of funds available to repay the 2013 Bonds are amounts held by the Fiscal Agent under the Fiscal Agent Agreement in the Bond Fund, amounts held by the Fiscal Agent under the Fiscal Agent Agreement in the Special Tax Fund and the Reserve Fund, and the proceeds, if any, from foreclosure sales of parcels with delinquent Special Tax levies. Special Taxes In accordance with the provisions of the Act, the Rate and Method was approved in 2003 by the then-qualified electors of Improvement Area No. 2 and is set forth in its entirety in Appendix B. Under the Fiscal Agent Agreement, the District is obligated to fix and levy the amount of Special Taxes within Improvement Area No. 2 required for the timely payment of principal of and interest on the outstanding 2013 Bonds becoming due and payable, including any necessary replenishment of the Reserve Fund and an amount estimated to be sufficient to pay the Administrative Expenses, taking into account any prepayments of Special Taxes previously received by the District. The Special Taxes levied on any parcel of Taxable Property 12 P830 (as defined in "—Summary of Rate and Method") may not exceed the maximum amount as provided in the Rate and Method. The Special Taxes are payable and are to be collected in the same manner, at the same time and in the same installment as County ad valorem taxes on property levied on the secured tax roll are payable, and pursuant to the Act have the same priority, become delinquent at the same times and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the taxes levied on the tax roll. Although the Special Taxes will constitute a lien on taxed parcels within Improvement Area No. 2, they do not constitute a personal indebtedness of the owners of the property within Improvement Area No. 2. Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of the Special Tax on a parcel of Taxable Property, the District may order the institution of a superior court action to foreclose the lien on the parcel of Taxable Property within specified time limits. In such an action, the real property subject to the unpaid amount of the Special Tax lien may be sold at judicial foreclosure sale. The Act provides that the Special Taxes are secured by a continuing lien that is subject to the same lien priority in the case of delinquency as ad valorem property taxes. See "—Summary of Rate and Method," "- Covenant for Superior Court Foreclosure' and "SPECIAL RISK FACTORS—Parity Taxes and Special Assessments." Other liens for taxes and assessments may already exist on the property located within Improvement Area No. 2 and others could come into existence in the future. See "SPECIAL RISK FACTORS—Parity Taxes and Special Assessments." There is no assurance that any owner of a parcel subject to the Special Tax levy will be financially able to pay the annual Special Taxes or that it will pay such taxes even if financially able to do so. See "SPECIAL RISK FACTORS." For historic information regarding assessed valuations and the payment of, or delinquencies with respect to, Special Taxes in Improvement Area No. 2, see 'IMPROVEMENT AREA NO. 2." Special Tax Fund Deposit of Special Tax Revenues. The Special Tax Fund is established under the Fiscal Agent Agreement as a separate fund to be held by the Fiscal Agent, to the credit of which the District or the City, on behalf of the District, will deposit, immediately upon receipt, all Special Tax Revenue received by the District or the City, on behalf of the District. The Special Tax Revenues deposited in the Special Tax Fund will be held and, other than Special Tax Revenues representing Prepayments, subsequently transferred to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 1. to the District for deposit in Administrative Expense Fund an amount equal to the Priority Administrative Expense Amount estimated to be due and payable during the Fiscal Year; 2. not later than 10 Business Days prior to each Interest Payment Date, to the Bond Fund: 13 P831 a. the amount representing past due installments of principal, interest and premium on the 2013 Bonds (including any interest thereon), if any, resulting from the delinquency in the payment of such Special Taxes; and b. an amount, taking into account any amounts then on deposit in the Bond Fund (other than by reason of the preceding paragraph a.) such that the amount in the Bond Fund equals the principal, premium, if any, and interest due on the 2013 Bonds on the next Interest Payment Date; 3. no later than 10 Business Days prior to each Interest Payment Date, to the Reserve Fund that amount, in addition to the amount transferred to the Bond Fund pursuant to paragraph 2. above, necessary to replenish any draw on the Reserve Fund; 4. on September 2 of each year after making the deposits and transfers required under paragraphs 1 and 2 above and the transfer, if any, authorized under paragraph 3 above, to the Rebate Fund, upon receipt of written instructions from an Authorized Officer on or before the preceding June 30, the amount specified in such written instructions necessary for the payment of any rebate amount due and owing to the United States of America by the District on the 2013 Bonds; 5. on September 2 of each year after making the deposits and transfers required under paragraphs 1 through 4 above, upon receipt of written instructions from an Authorized Officer, to the District for deposit in the Administrative Expense Fund the amount specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or the establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund and not included in any prior transfer made pursuant to paragraph 1 and 4 above; and 6. after September 2 of each year, after making the deposits and transfers made pursuant to paragraphs 1 through 5 above, monies then on deposit in the Special Tax Fund will remain therein and will be subsequently deposited or transferred pursuant to the provisions of paragraphs 1 through 5 above. Transfer of Prepayments. Amounts constituting Prepayments will be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Bond Fund designated as "Prepayment Account" and used to redeem Bonds as described above under the heading entitled "- Mandatory Redemption from Special Tax Prepayments." Any such transfer of Prepayments will be accompanied by written instructions executed by the Treasurer or an Authorized Officer directing the Fiscal Agent to place such Prepayments in the Prepayment Account. Penalties and Interest. Amounts constituting Penalties and Interest will be transferred by the Treasurer to the Fiscal Agent, and placed by the Fiscal Agent in a segregated account within the Special Tax Fund designated as 'Penalties and Interest Account." The moneys on deposit in the Penalties and Interest Account will be held and subsequently transferred, upon receipt of written instructions contained in an Officer's Certificate, to the following funds and accounts not later than the dates and in the amounts set forth in the following paragraphs and in the following order of priority: 14 P832 1. to the Administrative Expense Fund that amount as specified in such written instructions necessary for payment of the estimated Administrative Expenses projected to be due and payable in the next Fiscal Year, reimbursement of any Administrative Expenses incurred during the Fiscal Year ending on such June 30 or establishment or replenishment of a reasonable operating reserve within the Administrative Expense Fund not included in any prior transfer made pursuant to paragraphs 3 or 6 under the heading entitled "- Deposit of Special Tax Revenues"; 2. to the Bond Fund that amount as specified in such Officer's Certificate for the payment of debt service on the 2013 Bonds; 3. to the Reserve Fund that amount as specified in such Officer's Certificate as necessary to increase its balance up to the Reserve Requirement; or 4. to such other fund or account as specified in such Officer's Certificate for any authorized purpose of the District. Summary of Rate and Method The District is legally authorized, and the District has covenanted in the Fiscal Agent Agreement, to cause the levy of the Special Taxes within Improvement Area No. 2, and each of its Zones, in accordance with the Rate and Method. The Rate and Method apportions the total amount of Special Taxes to be collected among the Taxable Property within Improvement Area No. 2, including each of its Zones. The full text of the Rate and Method is set forth in Appendix B. Determination of Zone Tax Requirement. Pursuant to the Rate and Method, the amount of the Special Tax to be levied in each Fiscal Year is determined separately for each Zone within Improvement Area No. 2. In accordance with the Rate and Method, the City Council, acting as the legislative body of the District, will levy the Special Tax each Fiscal Year on the Taxable Property in each Zone until the amount of the Special Tax levied on such property is equal to the Special Tax Requirement for each Zone (the "Zone Special Tax Requirement"). The Zone Special Tax Requirement for a Zone, for each Fiscal Year, is equal to the sum of (a) the Zone Allocation for such Zone times the applicable Administrative Special Tax Requirement, (b) the amount required to (i) pay regularly scheduled debt service on all such Outstanding Zone Bonds for such Zone due in the calendar year beginning in such Fiscal Year, (ii) accumulate funds to pay directly for the construction of Authorized Facilities, and (iii) pay the Zone Delinquency Amount, if any, (c) less a credit for funds available to reduce the Special Tax levy within such Zone, as determined by the CFD Administrator pursuant to the applicable Fiscal Agent Agreement. The capitalized terms used in the previous paragraph are defined as follows, in accordance with the Rate and Method: "Zone Allocation" means, with respect to a Zone, the percentage of Bonds of the applicable Improvement Area allocated to such Zone based upon such Zone's share of the cost of the Authorized Facilities to be financed from the proceeds of such Bonds. Within Improvement Area No. 2, the Zone Allocations are as follows: the Zone 1 Allocation is 37.80% and the Zone 2 Allocation is 62.20%. 15 P833 "Administrative Special Tax Requirement" means, for any Fiscal Year, the amount estimated to be required to: (i) pay periodic costs on the bonds issued by the District with respect to Improvement Area No. 2 ("IA2 Bonds") other than regularly scheduled debt service, including but not limited to, credit enhancement and rebate payments on such Bonds as described in the applicable Fiscal Agent Agreement due in the calendar year beginning in such Fiscal Year, and (ii) pay Administrative Expenses. "Outstanding Zone Bonds" means, with respect to a Zone, (a) the product of(i) the original principal amount of the IA2 Bonds minus the principal amount of such Series of the Bonds that have been paid at maturity, or have been redeemed or defeased other than from the prepayments of Special Taxes for properties within such Zone and (ii) the Zone Allocation, minus (b) the principal amount of the IA2 Bonds that have been redeemed or defeased as a result of the prepayment of Special Taxes by the owners of Taxable Property within such Zone. 'Zone Delinquency Amount' means, with respect to a Zone, for any Fiscal Year, the amount required to (a) replenish the Reserve Fund for the IA2 Bonds in an amount equal to the amount withdrawn therefrom as a result of the delinquency in the payment of Special Taxes levied in such Zone, as reasonably determined by the CFD Administrator, and (b) pay for reasonably anticipated delinquent Special Taxes in such Zone based on the delinquency rate for the Special Taxes levied in such Zone in the previous Fiscal Year. Effect of Zone Allocation. The effect of the provisions of the Rate and Method described above is that each Zone is responsible only for debt service on the Bonds allocable to such Zone. Thus, Special Taxes may not be levied in one Zone in order to provide amounts to pay debt service on Bonds allocable to another Zone or to replenish the Reserve Fund following the use of moneys in the Reserve Fund to pay debt service on the 2013 Bonds as a result of Special Tax delinquencies by property owners in a different Zone. No assurance can be given that the amounts collected in a Zone in any given year will, in fact, equal the applicable Zone Special Tax Requirement, due to a variety of factors, including the unwillingness or inability of property owners in such Zone to pay the Special Taxes, the maximum Special rates, or the maximum term of the levy of the Special Taxes. For a discussion of the impact of the zone allocation methodology pursuant to the Rate and Method, see "SPECIAL RISK FACTORS - Impact of Zone Allocation." 16 P834 The Maximum Special Tax rates per unit for each class of Taxable Property in Improvement Area No. 2 for fiscal year 2013-14 are shown in the table below. There is no Undeveloped Property in Improvement Area No. 2. Table 1 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Maximum Special Tax Rates (per Acre) Fiscal Year 2013-14 Zone 1 Zone 2 Developed Property: Developed Property: Assigned Special Tax: $3,412 Assigned Special Tax: $10,337 Backup up Special Tax: 3,791 Backup up Special Tax: 11,487 Undeveloped Property: 3,791 Undeveloped Property: 11,487 See Appendix B- "Rate and Method." See also "SPECIAL RISK FACTORS - Maximum Rates." Prepayment of the Special Tax Obligation. The Special Tax is subject to prepayment. The prepayment amount will be established by the procedures that are described in Section H of the Rate and Method. As of the date of this Official Statement, there have been no Special Tax prepayments in Improvement Area No. 2. Duration of Levy. The Special Tax is authorized to be levied for as long as needed to pay debt service on bonds issued for the District, but not later than 50 years beginning in fiscal year 2003-04. Exemptions. Pursuant to Section 53340 of the Act, the Rate and Method exempts properties that are or are intended to be publicly owned; except that the Special Tax on property not otherwise exempt that is acquired by a public entity will be subject to the Special Tax pursuant to Sections 53317.3 and 53317.5 of the Act. Parcels for which the owner has prepaid Section 53317.3 and 53317.5 of the Act read as follows: 53317.3. If property not otherwise exempt from a special tax levied pursuant to[the Act]is acquired by a public entity through a negotiated transaction, or by gift or devise, the special tax shall ... continue to be levied on the.property acquired and shall be enforceable against the public entity that acquired the property. However, even if the resolution of formation that authorized creation of the district did not specify conditions under which the obligation to pay a special tax may be prepaid and permanently satisfied, the legislative body of the local agency that created the district may specify conditions under which the public agency that acquires the property may prepay and satisfy the obligation to pay the tax. The conditions may be specified only if the local agency that created the district finds and determines that the prepayment arrangement will fully protect the interests of the owners of the district's bonds. 53317.5. If property subject to a special lax levied pursuant to this chapter is acquired by a public entity through eminent domain proceedings, the obligation to pay the special tax shall be treated, pursuant to Section 1265.250 of the Code of Civil Procedure, as if it were a special annual assessment. For this purpose, the present value of the obligation to pay a special tax to pay the principal and interest on any indebtedness incurred by the district prior to the date of apportionment determined pursuant to Section 5082 of the Revenue and Taxation Code shall be treated the same as a fixed lien special assessment. 17 P835 and satisfied the Special Tax are also exempt from further Special Taxes. See "SPECIAL RISK FACTORS - Exempt Properties." Since formation of Improvement Area No. 2, there have been no prepayments of Special Taxes. Reserve Fund The Fiscal Agent Agreement establishes a debt service reserve fund (the "Reserve Fund") as a separate fund to be held by the Fiscal Agent. Moneys on deposit in the Reserve Fund will be used solely for the purpose of paying the principal of and interest on the 2013 Bonds, as such amounts will become due and payable, in the event that the moneys in the Special Tax Fund and the Bond Fund are insufficient for such purpose or for redeeming 2013 Bonds as described below. The Fiscal Agent will, when and to the extent necessary, withdraw money from the Reserve Fund and transfer such money to the Bond Fund or the Redemption Fund for such purpose. On any date after either the transfers, if any, required by the preceding paragraph have been made for any Bond Year or the valuation of the Permitted Investments in the Reserve Fund (in accordance with the Fiscal Agent Agreement), if the amount on deposit in the Reserve Fund is less than the Reserve Requirement, the Fiscal Agent will transfer to the Reserve Fund from the first available monies in the Special Tax Fund an amount necessary to increase the balance therein to the Reserve Requirement. If at least 10 Business Days prior to each Interest Payment Date of each year, the amount on deposit in the Reserve Fund, less Investment Earnings resulting from the investment of the funds it contains that, under the Fiscal Agent Agreement, must be rebated to the United States, is in excess of the Reserve Requirement, the Fiscal Agent will transfer such excess to the Bond Fund. In connection with any redemption of 2013 Bonds as described under the heading entitled "- Optional Redemption" above, amounts on deposit in the Reserve Fund which would be in excess of the Reserve Requirement following such redemption will be transferred to the Redemption Fund or the Bond Fund, as applicable, prior to such redemption and applied to such redemption of 2013 Bonds pursuant to written instructions of the District contained in an Officer's Correspondence. Whenever the balance in the Reserve Fund and the Bond Fund exceeds the amount required to redeem or pay the Outstanding 2013 Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent will transfer the amount in the Reserve Fund to the Bond Fund to be applied, on the next succeeding interest payment date, to the payment and redemption (as described under the heading entitled "- Optional Redemption" above) of all the Outstanding 2013 Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding 2013 Bonds, the balance in the Reserve Fund will be transferred to the District to be used for any lawful purpose of the District as set forth in the Act. Covenant for Superior Court Foreclosure Foreclosure Under the Act. Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of the Special Tax on the taxed parcel, the City may order the institution of a superior court action to foreclose the lien on the taxed parcel within specified time limits. In such an action, the real property subject to the unpaid amount of the Special Tax lien may be sold at judicial foreclosure sale. 18 P836 District Foreclosure Covenant. On or before March 1 and June 1 of each Fiscal year, the District will review the public records of the County to determine the amount of Special Taxes actually collected in such Fiscal Year. If the District determines that any parcel subject to the Special Taxes is delinquent in the payment of two or more installments of Special Taxes, the City will, not later than 45 days of such determination, send or cause to be sent a notice of delinquency (and a demand for their immediate payment) to the property owner. The City will cause judicial foreclosure proceedings to be commenced and filed in the Superior Court not later than 90 days of such determination against any parcel for which a notice of delinquency was given pursuant to this section and for which the Special Taxes remain delinquent. No assurance can be given as to the time necessary to complete any foreclosure sale or that any foreclosure sale will be successful. The City is not required to be a bidder at any foreclosure sale. Sufficiency of Foreclosure Sale Proceeds; Foreclosure Limitations and Delays. No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Special Tax installment. Subject to the maximum rates, the Rate and Method is designed to generate from all non-exempt property within the District the current year's debt service, administrative expenses, and replenishment of the Reserve Fund to the Reserve Requirement, including an amount reflecting the prior year's delinquencies. However, if foreclosure proceedings are necessary, and the Reserve Fund has been depleted, there could be a delay in payments to owners of the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the City of the proceeds of the foreclosure sale. Section 53356.6 of the Act requires that property sold pursuant to foreclosure under the Act be sold for not less than the amount of judgment in the foreclosure action, plus post- judgment interest and authorized costs, unless the consent of the owners of 75% of the outstanding 2013 Bonds is obtained. However, under Section 53356.6 of the Act, the City, as judgment creditor, is entitled to purchase any property sold at foreclosure using a "credit bid," where the City could submit a bid crediting all or part of the amount required to satisfy the judgment for the delinquent amount of the Special Tax. If the City becomes the purchaser under a credit bid, the City must pay the amount of its credit bid into the redemption fund established for the 2013 Bonds, but this payment may be made up to 24 months after the date of the foreclosure sale. Neither the Act nor the Fiscal Agent Agreement requires the City to purchase or otherwise acquire any lot or parcel of property foreclosed upon if there is no other purchaser at such sale, and the City has no intent to be such a purchaser. The City will levy the Special Tax to pay the current year's debt service and related administrative expenses and to replenish the Reserve Fund to the Reserve Requirement, subject to Maximum Special Tax rates. However, in the event such superior court foreclosure proceedings are necessary, and if the Reserve Fund is depleted, there could be a delay in payments of principal of and interest on the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the City of the proceeds of the foreclosure sale. See "SPECIAL RISK FACTORS—Bankruptcy Delays" and "—Proceeds of Foreclosure Sales." No Teeter Plan Collection of the Special Taxes is not subject to the "Alternative Method of Distribution of Tax Levies and Collections and of Tax Sale Proceeds," as provided for in Section 4701 et seq. of the California Revenue and Taxation Code (known as the "Teeter Plan"). Accordingly, 19 P837 collections of Special Taxes will reflect actual delinquencies, if any. Investment of Moneys Except as otherwise provided in the Fiscal Agent Agreement, all moneys in any of the funds or accounts established pursuant to the Fiscal Agent Agreement will be invested by the Fiscal Agent solely in Permitted Investments, as directed by the District or City. See Appendix C — "Summary of the Fiscal Agent Agreement" for a definition of"Permitted Investments" and for additional provisions regarding the investment of funds held under the Fiscal Agent Agreement. No Additional Bonds Other than for the purpose of refunding the 2013 Bonds, no additional 2013 Bonds entitled to a lien on the Special Tax Revenues may be issued under the Fiscal Agent Agreement. 20 P838 IMPROVEMENT AREA NO. 2 Location and Description of Improvement Area No. 2 General. Improvement Area No. 2 consists of approximately 82 gross acres (48.85 acres of Taxable Property) that are completely built-out. As explained in "SECURITY FOR THE 2013 BONDS — Summary of the Rate and Method" above, the Rate and Method divides the taxable property within Improvement Area No. 2 into two zones: Zone 1 and Zone 2. For purposes of determining the amount of the Special Taxes to be levied in each Zone in Improvement Area No. 2, the Rate and Method allocates a portion of the outstanding 2013 Bonds to each Zone in Improvement Area No. 2. Each Zone in Improvement Area No. 2 is responsible only for debt service on the outstanding 2013 Bonds allocated to such Zone, and Special Taxes may not be levied in one Zone of Improvement Area No. 2 in order to provide for amounts to pay debt service on outstanding 2013 Bonds allocated to another Zone in Improvement Area No. 2. Zone 1 Allocation. The Zone Allocation for Zone 1 is 37.80% of the initial principal amount of the 2013 Bonds (or $1,071,630). On the fiscal year 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 1 at $37,678,406. As of January 1, 2013, Zone 1 contained 12 developed commercial parcels, designated as Developed Property, that were responsible for the entire Special Tax levy in the Zone. All 12 parcels are owned by Foothill Crossing, LLC, and developed as an open-air mall. Zone 1 contains no parcels of Undeveloped Property. See "— Land Owners" below for more information about property ownership and land use in this Zone. Zone 2 Allocation. The Zone Allocation for Zone 2 is 62.20% of the initial principal amount of the 2013 Bonds (or $1,763,370). On the fiscal year 2012-13 property tax roll, the County Assessor valued the land and improvements comprising the property that is subject to the levy of Special Taxes in Zone 2 at $40,784,245. As of January 1, 2013, Zone 2 contained a single commercial parcel that was responsible for the entire Special Tax levy in the Zone. The parcel is owned by Rancho BP, LLC and operated as a Bass Pro Shop. Zone 2 contains no parcels of Undeveloped Property. See "— Land Owners' below for more information about property ownership and land use in this Zone. Preliminary; subject to change. 21 P839 c ° d 9 ° ° a ° a c Z M Z M N N E .2 m N N N N N O Co N N N N d M O O O V O v m N Q N d V C N N N f0 d d m m C 7 m w X Q > m V O CL E a c 000 o o 0 0 - � M y o C CL M M r.; Omi a w m 3 L N r r r r v r Im F M V d °d o d l6 o a O_- o._ CL >O c� aai 000 000o O v 9 N � . .aE � v a a oc CO @ y d d x ° md � m° Fm-' M 0 M ° Q a 0 Occ o y o m w N O NN ✓ ._ w y C C O N 0) ` y a m -2 E ? z7 Lo mom m0mo � ' ° O 00 + @O {a 00 V ate+ y C d .� M M n m rNi o m o w CL OM N 4) O` o � y> 0 .= w o m Ea p a -0 0 N C 00. m a0 ° iC N ._ N O M U d 01 C d 6 u_I 8 _ N :3 � c = EOa � 'u > > K ° d� A o o s „m =ate '0 0 > Ali QaF u �� p. 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The District has not commissioned an appraisal of the taxable property in Improvement Area No. 2 in connection with the issuance of the 2013 Bonds. Therefore, the valuation of the taxable property in Improvement Area No. 2 will be estimated for the purposes of the Act, and set forth in this Official Statement, based on the County Assessor's values. Assessed Valuation. The valuation of real property in the City is established by the County Assessor. Assessed valuations are reported at 100% of the full value of the property, as defined in Article XIIIA of the California Constitution. Article XIIIA of the California Constitution defines "full cash value" as the appraised value as of March 1, 1975, plus adjustments not to exceed 2% per year to reflect inflation, and requires assessment of "full cash value" upon change of ownership or new construction. Accordingly, the gross assessed valuation presented in this Official Statement may not necessarily be representative of the actual market value of certain property in Improvement Area No. 2. The fiscal year 2012-13 total assessed value of the 13 parcels of Taxable Property in Improvement Area No. 2 is $78,462,651. Table 3 below shows a history of assessed value in Improvement Area No. 2, as allocated among the Zones. Historical Assessed Values. The table below shows annual changes in assessed valuations between fiscal years 2004-05 and 2012-13 with respect to Taxable Property in each of the three Zones. Table 3 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2—Zones 1 and 2 Historical Assessed Valuation Fiscal Years 2004-05 through 2012-13 (Taxable Property) Zone 1 Zone 2 Parcels Parcels Parcels Total Fiscal Subject Subject Assessed % Subject Assessed % Assessed % Year to Levy to Levy Value 1 Change to Levy Value(1 Change Value 1 Change 2004-05 8 3 $10,454,611 NA 5 $ 7,101,148 NA $17,555,759 NA 2005-06 20 15 23,166,771 121.59% 5 7,243,171 2.00% 30,409,942 7312% 2006-07 16 15 43,476,483 87.67 1 6,450,038 (10.95) 49,926,521 64.18 2007-08 13 12 46,621,536 7.23 1 18,360,000 184.65 64,981,536 30.15 2008-09 13 12 47,553,967 2.00 1 39,000,000 112.42 86,553,967 3120 2009-10 13 12 48,505,046 2.00 1 39,780,000 2.00 88,285,046 2.00 2010-11 13 12 48,390,089 (0.24) 1 39,685,721 (0.24) 88,075,810 (0.24) 2011-12 13 12 38,140,594 (21.18) 1 39,984,554 0.75 78,125,148 (11.30) 2012-13 13 12 37,678,406 (1.21) 1 40,784,245 2.00 78,462,651 0.43 (1) Based on applicable San Bernardino County Assessor Roll dated January 1 preceding each Fiscal Year. Source: County of San Bernardino, City of Rancho Cucamonga, as compiled by David Taussig&Associates, Inc. 23 P841 The decline in the assessed value of the parcels in Zone 1 between fiscal years 2010-11 and 2011-12 is attributable to a reduction in the assessed value of the largest parcel (14.03 acres) in Zone 2 (APN 0229-021-74). The assessed value for this parcel for each of the last three years is set forth below: Fiscal Year Assessed Value 2010-11 $27,903,757 2011-12 17,500,000 2012-13 16,625,000 The property owner filed an appeal in 2010, and the County granted a temporary reduction under Proposition 8 for fiscal year 2011-12. Proposition 8, approved in 1978 (California Revenue and Taxation Code Section 51(b)), provides for the assessment of real property at the lesser of its originally determined (base year) full cash value compounded annually by the inflation factor, or its full cash value as of the lien date, taking into account reductions in value due to damage, destruction, obsolescence or other factors causing a decline in market value. After a roll reduction is granted, the property is reviewed on an annual basis to determine its full cash value and the valuation is adjusted accordingly. This may result in further reductions or in value increases. The increases must be in accordance with the full cash value of the property and may exceed the maximum annual inflationary growth rate allowed on other properties under Article XIIIA of the State Constitution. Once the property has regained its prior value, adjusted for inflation, it once again is subject to the annual inflationary factor growth rate allowed under Article XIIIA. Value-to-Debt Burden Ratio General Information Regarding Value-to-Debt Burden Ratios. The value-to-debt burden ratio on bonds secured by special taxes will generally vary over the life of those bonds as a result of changes in the value of the property that is security for the special taxes and the principal amount of the bonds. In comparing the aggregate assessed value of the real property within Improvement Area No. 2 and the principal amount of the 2013 Bonds, it should be noted that an individual parcel may only be foreclosed upon to pay delinquent installments of the Special Taxes attributable to that parcel. The principal amount of the 2013 Bonds is not allocated pro-rata among the parcels within the Zones; rather, the total Special Taxes have been allocated among the parcels within each of the Zones according to the Rate and Method. Economic and other factors beyond the property owners' control, such as economic recession, deflation of land values, financial difficulty or bankruptcy by one or more property owners, or the complete or partial destruction of Taxable Property caused by, among other possibilities, earthquake, flood, fire or other natural disaster, could cause a reduction in the assessed value within Improvement Area No. 2. See "SPECIAL RISK FACTORS - Property Value" and `Bankruptcy Delays." Aggregate Value-to-Debt Burden Ratio. The aggregate value-to-debt burden ratio of Taxable Property in Improvement Area No. 2, based on fiscal year 2012-13 assessed values, the initial principal amount of the 2013 Bonds, and the burden of overlapping special tax bonds and overlapping special assessment liens, is shown in Table 2 under the heading entitled "- Land Use Distribution" above. David Taussig & Associates, Inc., reports that there is also overlapping general obligation debt, and the properties in Improvement Area No. 2 are subject 24 P842 to a number of taxes, direct charges and assessments. See "—Direct and Overlapping Governmental Obligations' below. 25 P843 a c 9 d � N O C « amt�0 QQ frill d dN ZN .- ZZ N C N O 'O co C Q W z N E >m T � N a m N N C n w y o e "@O� O@ p O Q rn o a Q o v O N f0 e m Z �M ZZ o cn N N U N O CL F N (p N > d `N O N C T N ~ N @ d Q Ol r O N — O N @ @ > O c g N N > N 'O O1 X uin .fl W C C C d O W N 0 0 0 N W ` N O @M aE u 'O Cl) cu mom •- Q '� > maOFn xs N¢ t-. 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Y O Y G N d 7 N N G 0 00oin c cEw C) ,0Z0 } O .O N N m °v w W d N w N m r L d L CL H C � C N LL m U) O O c "'v`o C,j cc > 'p K Q > eq� Oad co O LL d O c — V O Q,Y O d d �-- 00000 O w cN O0 a E- r c"i � M � " o o vim`—° O. O " r OL NN O V N_ a LL 6 Nf fA A�Nta m N N v0 `oc w `o E O_ w cc y 0 0 O 6 N D O Y O Y O N d > y N d d y 0 0 0 0 >¢ d 0 d m J ` - v v Z Co EU`oE m .D gyp C ..C O 0 C C ._ yQ . Y N O N y N W � DV �Om NO.. N p N C C a N Y m a ymN >0 d j N y y N O T� 7 ) O O a m W d d a O O O m c c c v ' D Y N O> � � O c O o 0 2�2 C d 'O N 'EDD D �� O 00 W d 0N mmmm 0Um t 0 > o00o y "A„ o u o 4 d O P845 Land Owners The following table lists the payers of Special Taxes in Improvement Area No. 2 with respect to Taxable Property for fiscal year 2013-14, based on the projected fiscal year 2013-14 Special Tax levy and fiscal year 2013-14 assessed values. The table does not identify the names of individual homeowners. Table 5 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Summary of Special Tax Payers Fiscal Year 2013-14 (Taxable Property) Assigned Projected Fiscal Year 2013-14 Percent of No. of 2013-14 Actual Special Projected Development Status Taxable Special Tax Taxes Levy 2013-14 Assessed Ownership(1) (2) Parcels (3) (4)* Special Tax Value(1) Zone 1 Foothill Crossing, LLC Developed Commercial 12 $105,942 $73,540 37.80% $37,678,406 Zone 2 Rancho BP, LLC Developed Commercial 1 173,766 121,010 62.20 40,784,245 Grand Total 13 $279,708 $194,550 100.00% $78,462,651 Preliminary;subject to change. (1) Based on the San Bernardino County Assessor Roll dated January 1,2012. (2) Based on development status pursuant to the Rate and Method applicable for fiscal year 2013-14. (3) Based on the Assigned Special Tax levy pursuant to the Rate and Method. (4) Based on the levy to fund administrative expenses and the debt service on the 2013 Bonds. Source:David Taussig 8 Associates,Inc. Foothill Crossing, LLC provided the information in this section about the property in Zone 1 and about Foothill Crossing, LLC. The City can provide no assurances about the accuracy or completeness of such information. Rancho BP, LLC provided the information in this section about the property in Zone 2 and about Rancho BP, LLC. The City can provide no assurances about the accuracy or completeness of such information. 28 P846 Zone 1 Land Ownership. For fiscal year 2013-14, 12 developed residential parcels in Zone 1 are projected to be responsible for 37.80% of the Special Tax levy in Improvement Area No. 2 and 100% of the Special Tax levy in Zone 1. All 12 parcels are owned by Foothill Crossing, LLC and they are developed as an open-air mall. There are no parcels of Undeveloped Property in Zone 1. Set forth in the following paragraphs is a summary of Foothill Crossing, LLC and its property in Zone 1. Property Owner. Foothill Crossing, LLC is a single-purpose entity established to own and operate property in Improvement Area No. 2. Description of Foothill Crossing, LLC. Foothill Crossing, LLC operates its property in Improvement Area No. 2 as an open-air mall. The mall includes 312,307 square feet of retail and businesses. The mall, known as "Foothill Crossing," opened in late-2004. As of January 1, 2013, there was an approximately 97.28% occupancy rate (based on rentable square footage, and including space that has been vacated but remains subject to an existing lease with and payment obligation of the tenant, U.S. Bank) and the average remaining term of existing leases was 55.9 months (excluding extension options). Most of the leases are triple-net leases, which means the cost of the Special Taxes are passed through to the tenants by Foothill Crossing LLC. Set forth on the following page is a table listing for each space in the mall, as of January 1, 2013, the tenant, the number of square footage, the rent, the common area charges ("CAM"), concessions (if any), and the lease term. 29 P847 Lease Lease Unit Name Sqft Rent CAM Concession Total Deposit From To 12181 Vitamin Shoppe 4,500 15,187.50 2,880.00 18,067.50 111105 12131/14 12225-100 Coffee Bean 1,500 6,037.50 945.00 6,982.50 2/1105 1/31115 12225-120 VACANT 2,510 12225-160 US Bank 2,500 10,761.40 1,675.00 12,436.40 211105 1131115 12271 Red Robin 7,067 11,916.66 2,191.00 14,107.66 511105 4/30120 12327 Joe's Crab Shack 7,400 11,250.00 2,202.81 13,452.81 1/1105 12/31124 12357 Ortho Mattress 6,000 23,284.02 4,020.00 27,304.02 211/05 1131115 8158-100 VACANT 3,400 - 8158-120 VACANT 2,600 - 8160-100 Office Depot 20,000 27,916.67 4,000.00 31,916.67 11114105 12131120 8160-120 Richmond Am Homes 20,000 53,254.73 13,400.00 66,654.73 711106 6/30116 8188-100 Renaissance Salon 2,500 8,515.00 1,675.00 10,190.00 7,500.00 311/05 2128115 8188-120 Tantric Tanning 2,000 7,379.24 1,300.00 (2,179.24) 6,500.00 6,000.00 411105 3131115 8188-140 Buffalo Wild Wings 5,500 18,975.00 3,685.00 22,660.00 16,500.00 4/1105 3131115 8201 Total Wine 25,000 45,833.33 4,500.00 50,33133 1111109 10131119 8227 National Vision 4,500 16,603.30 2,835.00 19,438.30 13,500.00 711105 6130115 8250 Sears Grand 180,330 66,000.00 66,000.00 11/1104 10131124 8338 Century 21 15,000 30,623.86 9,600.00 (15,223.86) 25,000.00 111106 12131115 TOTALS 312,307 353,538.21 54,908.81 (17,403.10) 391,043.92 43,500.00 The income statement for Foothill Crossing LLC for calendar years 2011 and 2012 is attached as Appendix H. Existing Loan and Mortgage. In 2004, Foothill Crossing, LLC obtained a 15 year permanent loan from John Hancock Life Insurance Company, in the amount of $26,100,000, that is secured by a deed of trust and an assignment of leases and rents. On November 30, 2012, the loan was purchased by RGA Reinsurance Company. As of April 30, 2013, the aggregate outstanding balance of the loan was $14,062,086. Monthly installments of principal and interest in the amount of $211,863.69 are due through October 1, 2019. Representations by Foothill Crossing LLC. In connection with issuance of the 2013 Bonds, Foothill Crossing LLC-will represent to the City and the Underwriter as follows: (i) Foothill Crossing LLC has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (ii) Foothill Crossing LLC has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (iii) Foothill Crossing LLC is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by Foothill Crossing LLC or the ability of Foothill Crossing LLC to pay special taxes levied in Improvement Area No. 2. (iv). Foothill Crossing LLC is solvent and no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the 30 P848 debtor in a bankruptcy proceeding, or discharged from all of its debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of their debts. (v) There is no litigation or administrative proceeding of any nature in which Foothill Crossing LLC has been served, or is pending or threatened which, if successful, would materially adversely affect the ownership and operation of the property owned by Foothill Crossing LLC or the ability of Foothill Crossing LLC to pay special taxes levied in Improvement Area No. 2. Zone 2 Land Ownership. The parcel in Zone 2 is owned by Rancho BP, LLC and is operated as a Bass Pro Shop. There are no parcels of Undeveloped Property in Zone 2. Set forth in the following paragraphs is a summary of Rancho BP, LLC and its property in Zone 2. Property Owner. Rancho BP, LLC, a Delaware limited liability company, was formed on April 4, 2006 for the purpose of developing, operating and leasing the property in Zone 2 for a single tenant, Bass Pro Outdoor World, LLC. Rancho BP, LLC, is owned by a single member, Rancho BP Member, LLC. Rancho BP Member, LLC is comprised of two members 80 VGL, LLC (80% ownership) and 20 VGL, LLC (20% ownership) The sole member of 80 VGL, LLC is Simi Valley Town and Country, Inc., a California corporation. Simi Valley Town and Country, Inc., is a wholly owned subsidiary of Forest City Commercial Group, Inc., an Ohio corporation, which is itself a wholly owned subsidiary of Forest City Rental Properties Corporation, an Ohio corporation. Forest City Rental Properties Corporation is a wholly owned subsidiary of Forest City Enterprises, Inc., which is a New York Stock Exchange-traded company (NYSE Symbol: FCE.A). The sole member of 20 VGL, LLC is LHC Alligator, LLC, a Delaware limited liability company, whose sole manager is Lewis Operating Corp., a California corporation. Announced Recapitalization Transaction with QIC. On June 3, 2013, Forest City and QIC Limited ("QIC"), an Australian investment management company, entered into an agreement whereby QIC will invest in a portfolio of eight of Forest City's regional retail malls, including the real property owned by Rancho BP, LLC in Zone 2 of Improvement Area No. 2. The transaction is anticipated to close in the 3rd quarter of 2013. It is currently anticipated that there will be a restructuring of the ownership of membership interests of Rancho BP Member, LLC, the sole member of Rancho BP, LLC which owns the real property in Zone 2 of Improvement Area No. 2. The ownership interests of Rancho BP Member, LLC will directly or indirectly be held 51% by Forest City (or a Forest City related entity) and 49% will be owned directly or indirectly held by QIC. It is currently anticipated that 20 VGL, LLC will no longer hold any ownership interest in the currently taxable Zone 2 property. Forest City related entities will continue to manage the property in Zone 2. There can be no assurances that the QIC transaction will close or that the restructuring described herein will take place exactly as described. Any material deviation from this disclosure and information on the actual closed 31 P849 transaction will be provided when applicable pursuant to Rancho BP, LLC's Property Owner Continuing Disclosure Certificate. Description of the Zone 2 Property. Rancho BP, LLC leases the property in Zone 2 to Bass Pro Outdoor World, LLC pursuant to a lease dated August 26, 2005. The initial term of the lease expires in September 2037; the tenant has four consecutive renewal options of five years each. The lease calls for rental payments in an approximate amount of$3,325,000 per year. The property in Zone 2 is operated as an approximately 200,000 square foot Bass Pro Shop, which opened for operations on July 22, 2007. Statement of Operations for Rancho BP LLC. Set forth on the following page is the audited statement of operations for Rancho BP, LLC for fiscal years ending January 31, 2012 and January 31, 2013. 32 P850 Statement of Operations Rancho BP, LLC Fiscal Years Ended January 31, 2012 and 2013 (Audited) Year Ended Year Ended January 31,2012 January 31 2013 REVENUES Minimum Rents $3,215,164 $3,215,164 Tax reimbursement 435,983 568,526 Other 1,549 1,162 TOTAL REVENUES 3,652,696 3,784,852 EXPENSES Operating 127,057 131,379 Real estate taxes 564,410 568,555 TOTAL EXPENSES 691,467 699,934 NET OPERATING INCOME 2,961,229 3,084,918 Interest 1,860,800 1,812,837 Amortization of construction loan procurement costs 61,281 61,281 Depreciation and amortization 628,189 628,190 2,550,271 2,502,308 NET INCOME $ 410 958 A 582 610 Existing Loan and Mortgage. In 2006, Rancho BP, LLC obtained a construction loan from Greenwich Capital Financial Products, Inc., in the amount of$32,000,000, that is secured by a deed of trust and an assignment of leases and rents on the property in Zone 2 owned by Rancho BP, LLC. As of April 30, 2013, the aggregate outstanding balance of the loan was $29,592,578.38. Monthly installments of principal and interest in the amount of $192,638.66 are due through June 6, 2016, and a balloon payment of approximately $27,856,192 is due July 6, 2016. Representations by Rancho BP, LLC. In connection with issuance of the 2013 Bonds, Rancho BP, LLC will represent to the City and the Underwriter as follows: (i) Rancho BP, LLC has never failed in any material respect to comply with previous undertakings to provide periodic continuing disclosure reports or notices of material events within the past five years. (ii) Rancho BP, LLC has never defaulted to any material extent in the payment of special taxes or assessments in connection with any community facilities districts or assessment districts in California within the past five years. (iii) Rancho BP, LLC is not currently in default on any loans, lines of credit or other obligation, the result of which could materially adversely affect the ownership and operation of the property owned by Rancho BP, LLC or the ability of Rancho BP, LLC to pay special taxes levied in Zone 2 of Improvement Area No. 2. (iv) Rancho BP, LLC is solvent, and to its knowledge, no proceedings are pending or threatened in which it may be adjudicated as bankrupt or become the debtor in a bankruptcy proceeding, or discharged from all of its 33 P851 debts or obligations, or granted an extension of time to pay its debts or a reorganization or readjustment of its debts. (v) There is no litigation or administrative proceeding of any nature in which Rancho BP, LLC has been served or, to its knowledge, is pending or threatened that, if successful, would materially adversely affect the ownership and operation of the property owned by Rancho BP, LLC or the ability of Rancho BP, LLC to pay special taxes levied in Zone 2 of Improvement Area No. 2. Delinquencies The following table is a summary of Special Tax levies, collections and delinquency rates on taxable properties in Improvement Area No. 2 for fiscal years 2004-05 through 2012-13 based on amounts levied and outstanding delinquencies as of June 30 of the fiscal year and as of May 1, 2013. Table 6a City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2—Zone 1 Special Tax Collections and Delinquencies Fiscal Years 2004-05 through 2012-13 (Taxable Property) As of End of Fiscal Year As of May 1, 2013 Total Number of Parcels Amount Number of Remaining Remaining Remaining Fiscal Amount Subject to Amount Delinquent Delinquent Percent Amount Parcels Percent Year Levied Levy Collected 1 1 Parcels Delinquent Delinquent Delinquent Delinquent 2004-05 $179,078 3 $179,078 $0 0 0.00% $0 0 0.00% 2005-06 125,038 15 125,038 0 0 0.00 0 0 0.00 2006-07 84,371 15 84,371 0 0 0.00 0 0 0.00 2007-08 77,687 12 77,687 0 0 0.00 0 0 0.00 2008-09 77,687 12 77,687 0 0 0.00 0 0 0.00 2009-10 77,687 12 77,687 0 0 0.00 0 0 0.00 2010-11 77,687 12 77,687 0 0 0.00 0 0 0.00 2011-12 77,687 12 77,687 0 0 0.00 0 0 0.00 2012-13 77,687 12 77,687 0 0 0.00 0 0 0.00 (1) Amount Collected for Fiscal Year 2012-13 represent first and second installment amounts collected and delinquent as of May 1, 2013. Source:County of San Bernardino,City of Rancho Cucamonga,as compiled by David Taussig&Associates,Inc. 34 P852 Table 6b City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 —Zone 2 Special Tax Collections and Delinquencies Fiscal Years 2004-05 through 2012-13 (Taxable Property) As of End of Fiscal Year As of May 1 2013 Total Number of Parcels Amount Number of Remaining Remaining Remaining Fiscal Amount Subject to Amount Delinquent Delinquent Percent Amount Parcels Percent Year Levied Levy Collected 1 1 Parcels Delinquent Delinquent Delinquent Delinquent 2004-05 $ 14,750 5 $ 14,750 $0 0 0.00% $0 0 0.00% 2005-06 69,022 5 69,022 0 0 0.00 0 0 0.00 2006-07 124,394 1 124,394 0 0 0.00 0 0 0.00 2007-08 127,386 1 127,386 0 0 0.00 0 0 0.00 2008-09 127,386 1 127,386 0 0 0.00 0 0 0.00 2009-10 127,386 1 127,386 0 0 0.00 0 0 0.00 2010-11 127,386 1 127,386 0 0 0.00 0 0 0.00 2011-12 127,386 1 127,386 0 0 0.00 0 0 0.00 2012-13 127,386 1 127,386 0 0 0.00 0 0 0.00 (1) Amount Collected for Fiscal Year 2012-13 represent first and second installment amounts collected and delinquent as of May 1, 2013. Source:County of San Bernardino,City of Rancho Cucamonga,as compiled by David Taussig 8 Associates, Inc. 35 P853 Direct and Overlapping Governmental Obligations Taxes, Charges and Assessments. The base property tax rate on property in Improvement Area No. 2 is 1.0000% (including ad valorem tax overrides). Property in Improvement Area No. 2 is also subject, or will be subject, to certain annual charges and assessments (which are billed to property owners on a semi-annual basis). Set forth below is summary of overlapping annual charges and assessments on Taxable Property in Improvement Area No. 2. Table 7 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Taxes, Charges and Assessments for Representative Property 1 Fiscal Year 2012-13 DESCRIPTION Zone 1 Zone REPRESENTATIVE NET TAXABLE ASSESSED VALUE PER PARCEL(1) $3,397,596 $40,784,245 Percent FISCAL YEAR 2011-2012 AD VALOREM PROPERTY TAXES(2) of Total AV Amount Amount BASE PROPERTY TAX 1.0000% $33,976 $407,842 CHAFFEY COMMUNITY COLLEGE DISTRICT G.O. BONDS 0.0111 377 4,527 CHAFFEY JOINT UNION HIGH SCHOOL DISTRICT G.O.BONDS 0.0101 343 4,119 METROPOLITAN WATER DISTRICT MID-VALLEY G.O.BONDS 0.0035 119 1,427 SUBTOTAL AD VALOREM PROPERTY TAX RATE/TAXES $34,815 $417,916 PARCEL CHARGES,ASSESSMENTS AND SPECIAL TAXES(3) Amount Amount METROPOLITAN WATER DISTRICT WATER STANDY CHARGE $ 23 $ 128 WEST VALLEY MOSQUITO&VECTOR CONTROL CHARGE 6 208 CITY OF RANCHO CUCAMONGA LIGHTING DISTRICT No. 1 107 598 CITY OF RANCHO CUCAMONGA LIGHTING DISTRICT No.3 283 1,585 CITY OF RANCHO CUAMONGA LANDSCAPE DISTRICT No.3B 1,059 5,931 CITY OF RANCHO CUCAMONGA FIRE PROTECTION DISTRICT CFD No.85-1 2,255 15,905 CITY OF RANCHO CUCAMONGA CFD No.2001-01 (4) 4,488 NAP CITY OF RANCHO CUCAMONGA CFD No.2003-01 (4) 7,506 127,386 SUBTOTAL PARCEL CHARGES,ASSESSMENTS AND SPECIAL TAXES $15,727 $151,742 TOTAL PROPERTY TAXES $50,542 $569,658 TOTAL EFFECTIVE TAX RATE 1.488% 1.397% (1) Based on assessed value information provided by San Bernardino County Assessor's Office as of January 1,2012. (2) Based on the fiscal year 2012-13 ad valorem rates for Tax Rate Areas 15016 (Zone 1) and 15053 (Zone 2). Rates subject to change in future years. (3) Based on the fiscal year 2012-13 charges identified on San Bernardino County issued property tax bill. Charges subject to change in future years. (4) Based on the fiscal year 2012-13 actual Special Tax. Source:David Taussig 8 Associates,Inc.,City of Rancho Cucamonga,County of San Bernardino. The overlapping assessment districts and community facilities districts affecting the property in the District are further described below. Community Facilities District No. 85-1 Foothill Fire Protection District. This community facilities district was formed by the Foothill Fire Protection District, predecessor to the Rancho Cucamonga Fire Protection District, to finance operations, maintenance and repair activities carried out by employees of the Rancho Cucamonga Fire Protection District to provide fire protection and suppression services. Special taxes 36 P854 are levied annually only on developed parcels. The special tax on commercial and industrial property is levied at a flat rate per acre plus a rate per building square foot (which can be reduced by $0.01 per building square foot if building has fire sprinkler system). Current special tax rates for industrial property are $119.76 per acre per year, plus $0.080 per building square foot, and rates for commercial property are $119.76 per acre per year, plus $0.065 per building square foot. The special taxes may be increased annually to reflect the CPI index. Community Facilities District No. 2001-01. This community facilities district was formed by the City to finance the construction of street, storm drain, sewer and water improvements. Only the property within Zone 1 of Improvement Area No. 2 is located within this community facilities district. The maximum special tax authorized to be levied on the property within Zone 1 of Improvement Area No. 2 for this community facilities district is $1,963.45 per acre and there are 42.74 acres of taxable property within Zone 1. The aggregate maximum special tax that may be levied within Zone 1 is $83,917.85 per year. Street Lighting Maintenance District No. 1. This maintenance district was formed to finance the cost of the energy charges and maintenance of arterial street lighting through the levy of annual assessments. The current annual assessment is $17.77 for a multi-family residence and $35.54 per acre for commercial property. Street Lighting Maintenance District No. 3. The assessment pays for energy and maintenance of streetlights. The current assessment rate is $47.15 per single-family residence. The commercial rate is $94.30 per acre. Any increase in the assessment must be approved by the voters. Landscape Maintenance District No. 3B. Landscape Maintenance District No. 3B was formed in 1988 and consists of 1,103 parcels with a total acreage of 2769.73 acres. Landscape Improvements provided in the district may include but are not limited to: turf, ground cover, shrubs and trees, sprinkler and irrigation systems, ornamental lighting, drainage systems, masonry walls, entryway monument, and associated appurtenances. These improvements include: all necessary service; operations; administration; and maintenance required to keep the above-mentioned improvements in a healthy, vigorous, and satisfactory working condition. The City utilizes the services of landscape maintenance contractors and City crews for all regularly scheduled landscape maintenance. The current assessment rate is $352.80 per acre for commercial property. Any increase in the assessment must be approved by the voters. 37 I P855 Overlapping Public Debt. Contained within the boundaries of Improvement Area No. 2 are certain overlapping local agencies providing public services and assessing property taxes, assessments, special taxes and other charges on the property in Improvement Area No. 2. Many of these local agencies have outstanding debt. The current and estimated direct and overlapping obligations affecting the property in Improvement Area No. 2 are shown in the following table. The overlapping obligations are not shown on a Zone-specific basis, but the allocation of the overlapping obligations to properties within each Zone is set forth in the preceding tables. Table 8 City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 Direct and Overlapping Bonded Debt As of January 1, 2013 Amount of Percent of Levy on Levy on Improve. Taxable Taxable Area No.2 Fiscal Year Parcels in Parcels in Total Debt Share of 2013-13 Total Improve. Improve. Outstanding Total Debt Overlapping District Levy Area No. 2 Area No.2 (1) Outstanding Metropolitan Water District Mid-Valley G.O. Bonds $92,246,662 $ 2,746 0.003% $165,085,000 $4,915 Chaffey Community College District G.O. Bonds 10,475,281 8,709 0.083 214,048,348 177,964 Chaffey Joint Union High School District G.O. Bonds 4,690,232 7,925 0.169 182,305,000 308,027 Eliwanda School District CFD No. 2001-1 (2) 56,061 46,443 82.844 802,000 664,410 Estimated Share of Overlapping Bonded Debt Allocable to Improve.Area No.2 $1,155,316 Plus: 2013 Bonds' 2,835,000 Estimated Share of Direct and Overlapping Bonded Debt Allocable to Improve.Area No. 1` $3,990,316 Preliminary;subject to change. (1) As of June 1,2013. (2) Overlaps only Zone 1 of Improvement Area No.2. Source:David Taussig&Associates,Inc.,County of San Bernardino. 38 P856 Scheduled Debt Service Coverage The following tables show scheduled debt service coverage on the 2013 Bonds in each Zone, and in the aggregate, based on maximum Special Tax Revenues, assuming 0% Special Tax delinquencies and that the maximum allowed amount of Special Tax Revenues is deposited into the Administrative Expense Fund for each year Bond Year shown. See "SECURITY FOR THE 2013 BONDS -General." The City can provide no assurances that Special Taxes will be collected when levied, as assumed in this table. Table 9a City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2 -Zone 1 Scheduled Debt Service Coverage (Taxable Property) Estimated Developed Priority Debt Coverage Property Administrative Service on from Year Special Tax Expense 2013 Developed Ending Revenues (1) Amount(2) Bonds(3)' Property (4)' 2014 $105,942 $4,608 $68,932 147.01% 2015 108,060 4,700 72,746 142.08 2016 110,222 4,794 72,349 145.72 2017 112,426 4,890 75,600 142.24 2018 114,675 4,988 76,772 142.87 2019 116,968 5,087 77,738 143.92 2020 119,307 5,189 80,455 141.84 2021 121,694 5,293 82,959 140.31 2022 124,127 5,399 83,342 142.46 2023 126,610 5,507 85,437 141.74 2024 129,142 5,617 87,268 141.55 2025 131,725 5,729 88,816 141.86 2026 134,359 5,844 92,019 139.66 2027 137,047 5,961 93,002 140.95 2028 139,788 6,080 93,730 142.65 2029 142,583 6,201 97,973 139.20 2030 145,435 6,326 99,863 139.30 2031 148,344 6,452 103,359 137.28 2032 151,311 6,581 104,477 138.53 2033 154,337 6,713 105,304 140.19 ' Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2%. (2) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of$10,000, escalating at 2%annually, multiplied by the Zone 1 Allocation of 37.80%. (3) Based on the debt service on the 2013 Bonds, multiplied by the Zone 1 Allocation of 37.80%. (4) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig&Associates, Inc.;Stifel, Nicolaus&Company, Incorporated. 39 P857 Table 9b City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2-Zone 2 Scheduled Debt Service Coverage (Taxable Property) Estimated Developed Priority Debt Coverage Property Administrative Service on from Year Special Tax Expense 2013 Developed Ending Revenues (1) Amount(2) Bonds (3)' Property (4)• 2014 $173,766 $ 7,582 $113,428 146.51% 2015 177,242 7,734 119,704 141.61 2016 180,786 7,888 119,051 145.23 2017 184,402 8,046 124,400 141.77 2018 188,090 8,207 126,328 142.39 2019 191,852 8,371 127,918 143.44 2020 195,689 8,539 132,389 141.36 2021 199,603 8,710 136,510 139.84 2022 203,595 8,884 137,139 141.98 2023 207,667 9,061 140,588 141.27 2024 211,820 9,243 143,600 141.07 2025 216,056 9,427 146,147 141.38 2026 220,378 9,616 151,418 139.19 2027 224,785 9,808 153,035 140.48 2028 229,281 10,004 154,233 142.17 2029 233,866 10,205 161,215 138.74 2030 238,544 10,409 164,325 138.83 2031 243,315 10,617 170,078 136.82 2032 248,181 10,829 171,917 138.06 2033 253,145 11,046 173,278 139.72 Preliminary;subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2%. (2) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of$10,000, escalating at 2% annually, multiplied by the Zone 2 Allocation of 62.20%. (3) Based on the debt service on the 2013 Bonds, multiplied by the Zone 2 Allocation of 62.20%. (4) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds. Source: David Taussig &Associates, Inc.; Stifel, Nicolaus&Company, Incorporated. 40 P858 In reviewing Table 9c, it is important to be aware that each Zone is responsible only for debt service on the percentage of outstanding 2013 Bonds allocated to it, and Special Taxes may not be levied in one Zone in order to provide for amounts to pay debt service on outstanding 2013 Bonds allocated to another or to replenish the Reserve Fund following the use of moneys in the Reserve Fund to pay debt service on the 2013 Bonds as a result of Special Tax delinquencies by property owners in a different Zone. See "SPECIAL RISK FACTORS - Impact of Zone Allocation." Table 9c City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2-All Zones Scheduled Debt Service Coverage (Taxable Property) Estimated Developed Priority Debt Coverage Property Administrative Service on from Year Special Tax Expense 2013 Developed Ending Revenues (1) Amount(2) Bonds (3)* Property (4)* 2014 $279,708 $12,190 $182,360 146.70% 2015 285,302 12,434 192,450 141.79 2016 291,008 12,682 191,400 145.42 2017 296,828 12,936 200,000 141.95 2018 302,765 13,195 203,100 142.58 2019 308,820 13,459 205,656 143.62 2020 314,996 13,728 212,844 141.54 2021 321,296 14,002 219,469 140.02 2022 327,722 14,282 220,481 142.16 2023 334,277 14,568 226,025 141.45 2024 340,962 14,859 230,869 141.25 2025 347,781 15,157 234,963 141.57 2026 354,737 15,460 243,438 139.37 2027 361,832 15,769 246,038 140.65 2028 369,068 16,084 247,963 142.35 2029 376,450 16,406 259,188 138.91 2030 383,979 16,734 264,188 139.01 2031 391,658 17,069 273,438 136.99 2032 399,491 17,410 276,394 138.24 2033 407,481 17,758 278,581 139.90 Preliminary; subject to change. (1) Based on the levy of the Assigned Special Tax and the development status pursuant to the Rate and Method applicable for fiscal year 2013-14. Special Taxes for all subsequent years are escalated annually at 2%. (2) Based on the fiscal year 2003-04 Priority Administrative Expense Amount of $10,000, escalating at 2% annually. (3) Based on the debt service on the 2013 Bonds. (4) Developed Property Special Tax Revenues, less Priority Administrative Expense Amount, divided by Debt Service on the 2013 Bonds, Source: David Taussig&Associates, Inc.; Stifel, Nicolaus&Company, Incorporated. 41 P859 SPECIAL RISK FACTORS The following is a description of certain risk factors affecting Improvement Area No. 2, the property owners in Improvement Area No. 2, the parcels subject to the levy of Special Taxes and the payment of and security for the 2013 Bonds. The following discussion of risks is not meant to be a complete list of the risks associated with the purchase of the 2013 Bonds and does not necessarily reflect the relative importance of the various risks. Potential investors are advised to consider the following factors along with all other information in this Official Statement in evaluating the investment quality of the 2013 Bonds. There can be no assurance that other risk factors will not become material in the future. Concentration of Property Ownership Failure of any significant landowner to pay the annual Special Taxes when due could result in the rapid, total depletion of the Reserve Fund prior to replenishment from the resale of the property upon a foreclosure or otherwise or prior to delinquency redemption after a foreclosure sale, if any. In that event, there could be a default in payments of the principal of and interest on the 2013 Bonds. The following paragraphs briefly summarize concentration of property ownership in each Zone: Zone 1, which is responsible for 37.80% of the debt service on the 2013 Bonds, is built-out with an open-air mall that is owned by Foothill Crossing LLC. Zone 2, which is responsible for payment of 62.20% of the debt service on the 2013 Bonds, is built-out with a Bass Pro Shop owned by Rancho BP, LLC and leased to Bass Pro Outdoor World, LLC. See Table 5, "Summary of Special Tax Payers," under "Improvement Area No. 2 —Land Owners." Risks Associated with Commercial Real Estate Properties Property in Improvement Area No. 2 is commercial in nature. There are certain significant risks associated with commercial real estate properties, as discussed in the following paragraphs. Dependence on Tenants. The ability of commercial properties to pay the Special Taxes may depend on the ability of its tenants to meet their financial obligations under their leases. In the event of defaults by tenants, delays may be experienced in enforcing rights and substantial costs may be incurred in protecting the property owner's investment. Furthermore, at any time, a tenant could seek protection under bankruptcy laws, which could result in the termination of the tenant's lease and an interruption or loss of rental income. The bankruptcy of a major tenant, followed by the closing of its business or the leasing of its space to a different tenant or for a different use, could adversely affect the desirability of the property and result in a decrease in consumer traffic and sales income which would adversely affect the ability of the other tenants to meet their obligations under their leases. 42 P860 Factors Affecting Economic Performance and Value of Commercial Properties. The economic performance and value of the Taxable Property in Improvement Area No. 2 will be affected by a number of factors, including national economic conditions, regional economic conditions (which may be adversely affected by plant closings, industry slow-downs and other factors), local real estate conditions such as an oversupply of retail space or a reduction in the demand for retail space in the area, the attractiveness of the retail property to tenants, competition from other retailers (including on-line retailers), the quality of maintenance, the cost of insurance and management services, and increased operating costs. Other factors which may adversely affect the economic performance and value of the Taxable Property in Improvement Area No. 2 include changes in government regulations and other laws, rules and regulations governing real estate, zoning or taxes, increases in interest rates, the availability of financing and potential liability under environmental and other laws. Due to these factors and other risks, there can be no assurance that commercial property in Improvement Area No. 2 will remain economically viable throughout the term of the 2013 Bonds, or that the owners of the Taxable Property in Improvement Area No. 2 will continue to have the ability throughout the term of the 2013 Bonds to pay the Special Taxes which will be levied on the Taxable Property. Impact of Zone Allocation The Rate and Method divides the property in Improvement Area No. 2 into two Zones and allocates a portion of the Outstanding 2013 Bonds to each Zone. Each Zone is responsible only for debt service on the 2013 Bonds allocable to such Zone, and Special Taxes cannot be levied in one Zone within Improvement Area No. 2 in order to provide amounts to pay debt service on Bonds allocable to another Zone in Improvement Area No. 2. Therefore, in the event that the Special Taxes collected within a Zone within Improvement Area No. 2 were insufficient to pay debt service on the 2013 Bonds allocated to such Zone, the Special Tax levy in the remaining Zones within Improvement Area No. 2 could not be increased in order to offset such insufficiency (even if the Special Taxes were being levied in such remaining Zones at less than the maximum tax rates) and, upon depletion of the Reserve Fund, there could be a default in the payment of the 2013 Bonds. See "SECURITY FOR THE 2013 BONDS — Summary of Rate and Method - Determination of Zone Special Tax Requirement." Pursuant to the Fiscal Agent Agreement, a single Reserve Fund is established for the 2013 Bonds. Moneys on deposit in the Reserve Fund are available for paying the debt service on the 2013 Bonds in the event that there are insufficient amounts for such purpose in the Bond Fund. A draw on the Reserve Fund could occur as the result of Special Tax delinquencies in any Zone within Improvement Area No. 2. However, pursuant to the Rate and Method, Special Taxes may be levied within a Zone in Improvement Area No. 2 for the purpose of replenishing the Reserve Fund only if and to the extent that amounts were withdrawn from the Reserve Fund as a result of delinquencies in such Zone. Therefore, if a draw on the Reserve Fund were to occur as the result of Special Tax delinquencies in one Zone, the Special Tax levy in the other Zones in Improvement Area No. 2 could not be increased in order to replenish the Reserve Fund (even if the Special Taxes were being levied in such remaining Zones at less than the maximum tax rates). See "SECURITY FOR THE 2013 BONDS — Summary of the Rate and Method - Determination of Zone Special Tax Requirement." The amount of the Zone Special Tax Requirement for a Zone in Improvement Area No. 2 is a function of the amount of Outstanding 2013 Bonds allocated to such Zone pursuant to the Rate and Method. The allocation of Outstanding 2013 Bonds to a Zone in Improvement Area 43 P861 No. 2 pursuant to the Rate and Method is based on (a) such Zone's share of the cost of the Authorized Facilities financed from Bond proceeds, determined at the time of issuance of the 2013 Bonds, and (b) the amount of the 2013 Bonds, if any, that have been redeemed or defeased as a result of the prepayment of Special Taxes on parcels in such Zone. Therefore, the amount of Outstanding 2013 Bonds allocated to a Zone within Improvement Area No. 2, and the share of debt service on the Outstanding 2013 Bonds for which such Zone is responsible, will change if Special Taxes are prepaid. See "SECURITY FOR THE 2013 BONDS – Summary of the Rate and Method - Determination of Zone Special Tax Requirement." Payment of the Special Tax Is Not a Personal Obligation The owners of the parcels in Improvement Area No. 2 are not personally obligated to pay the Special Tax. Rather, the Special Tax is an obligation that is secured only by a lien against the parcels on which it is levied. If the value of the taxable parcels is not sufficient to secure fully the payment of the Special Tax, the District has no recourse against the landowners. No General Obligation of the City or the District The District's obligations under the 2013 Bonds and under the Fiscal Agent Agreement are limited obligations of the District with respect to Improvement Area No. 2 and are payable solely from and secured solely by the Special Tax Revenues and amounts in the Special Tax Fund, the Bond Fund and the Reserve Fund. The 2013 Bonds are neither general or special obligations of the District or Improvement Area No. 2 nor general obligations of the City, but are limited obligations of the District with respect to Improvement Area No. 2 payable solely from the revenues and funds pledged therefor and under the Fiscal Agent Agreement. None of the faith and credit of the District, Improvement Area No. 2, the City or the State of California or of any of their respective political subdivisions is pledged to the payment of the 2013 Bonds. Property Value If a landowner defaults in the payment of the Special Tax, the only legal remedy is the institution of a superior court action to foreclose on the delinquent taxable parcel in an attempt to obtain funds with which to pay the Special Tax. The value of the taxable parcels in Improvement Area No. 2 could be adversely affected by economic factors beyond the City's control, including, without limitation, (i) adverse changes in local market conditions, such as changes in the market value of real property in the vicinity of Improvement Area No. 2, the supply of or demand for competitive properties in such area, and the market value of property in the event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relating to endangered species and hazardous materials) and fiscal policies; and (iii) natural disasters (including, without limitation, wildfire, earthquakes and floods), which may result in uninsured losses. See "—Natural Disasters." No assurances can be given that the real property subject to a judicial foreclosure sale will be sold or, if sold, that the proceeds of such sale will be sufficient to pay the delinquent Special Tax installment. Although the Act authorizes the City to cause such an action to be commenced and diligently pursued to completion, the Act does not specify any obligation of the City with regard to purchasing or otherwise acquiring any lot or parcel of property sold at the foreclosure sale in any such action if there is no other purchaser at such sale. The City is not 44 P862 obligated and does not expect to be a bidder at any such foreclosure sale. See "—Proceeds of Foreclosure Sale." Exempt Properties Certain properties are exempt from the Special Tax in accordance with the Rate and Method. In addition, the Act provides that properties or entities of the state, federal or local government are exempt from the Special Tax; provided, however, that property within Improvement Area No. 2 acquired by a public entity through a negotiated transaction, or by gift or devise, that is not otherwise exempt from the Special Tax, will continue to be subject to the Special Tax. It is possible that property acquired by a public entity following a tax sale or foreclosure based upon failure to pay taxes could become exempt from the Special Tax. In addition, the Act provides that if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings, the obligation to pay the Special Tax with respect to that property, for Outstanding 2013 Bonds only, is to be treated as if it were a special assessment. The constitutionality and operation of these provisions of the Act have not been tested. See "SECURITY FOR THE 2013 BONDS - The Special Tax." In particular, insofar as the Act requires payment of the Special Tax by a federal entity acquiring property within Improvement Area No. 2, it may be unconstitutional. If for any reason property within Improvement Area No. 2 becomes exempt from taxation by reason of ownership by a nontaxable entity such as the federal government or another public agency, subject to the limitation of the Maximum Rate, the Special Tax will be reallocated to the remaining taxable properties within the applicable Zone. This would result in the owners of such property paying a greater amount of the Special Tax and could have an adverse impact upon the timely payment of the Special Tax. Moreover, if a substantial portion of land within Improvement Area No. 2 becomes exempt from the Special Tax because of public ownership, or otherwise, the maximum rate that could be levied upon the remaining acreage might not be sufficient to pay principal of and interest on the 2013 Bonds when due and a default would occur with respect to the payment of such principal and interest. The Act further provides that no other properties or entities are exempt from the Special Tax unless the properties or entities are expressly exempted in a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax. Parity Taxes and Special Assessments The Special Taxes and any related penalties will constitute liens against the taxable parcels in Improvement Area No. 2 until they are paid. Such lien is on a parity with all special taxes and special assessments levied by other agencies and is coequal to and independent of the lien for general property taxes regardless of when they are imposed upon the taxable parcel. The Special Taxes have priority over all existing and future private liens imposed on the property. The District, however, has no control over the ability of other entities and districts to issue indebtedness secured by special taxes or assessments payable from all or a portion of the taxable parcel within Improvement Area No. 2 subject to the levy of Special Taxes. In addition, the landowners within Improvement Area No. 2 may, without the consent or knowledge of the District, petition other public agencies to issue public indebtedness secured by special taxes or assessments, and any such special taxes or assessments may have a lien on such property on a parity with the Special Taxes. The imposition of additional indebtedness could reduce the willingness and the ability of the property owners within Improvement Area No. 2 to pay the Special Taxes when due. 45 P863 Insufficiency of Special Taxes In order to pay debt service on the 2013 Bonds, it is necessary that the Special Taxes levied against taxable parcels within Improvement Area No. 2 be paid in a timely manner. The Fiscal Agent has established the Reserve Fund in an amount equal to the Reserve Requirement to pay debt service on the 2013 Bonds to the extent Special Taxes are not paid on time and other funds are not available. See "SECURITY FOR THE 2013 BONDS—Reserve Fund" and Appendix C –"Summary of the Fiscal Agent Agreement." Under the Fiscal Agent Agreement, the District has covenanted to maintain in the Reserve Fund an amount equal to the Reserve Requirement; subject, however, to the limitations that the District may not levy the Special Tax in any fiscal year at a rate in excess of the Maximum Special Tax rates permitted under the Rate and Method. See "SECURITY FOR THE 2013 BONDS—Special Taxes." Additionally, pursuant to Government Code Section 53321(d), in the case of any special tax to pay for public facilities and to be levied against any parcel used for private residential purposes, under no circumstances will the Special Tax levied in any fiscal year against a private residential parcel be increased as a consequence of delinquency or default by the owner or owners of any other parcel or parcels within the same Zone by more than 10% above the amount that would have been levied in that fiscal year had there never been any such delinquencies or defaults. Consequently, if a delinquency occurs, the District may be unable to replenish the Reserve Fund to the Reserve Requirement due to the limitation of the Maximum Special Tax rates. If such defaults were to continue in successive years, the Reserve Fund could be depleted and a default on the 2013 Bonds would occur if proceeds of a foreclosure sale did not yield a sufficient amount to pay the delinquent Special Taxes. The District has made certain covenants regarding the institution of foreclosure proceedings by the City to sell any property with delinquent Special Taxes in order to obtain funds to pay debt service on the 2013 Bonds. See "SECURITY FOR THE 2013 BONDS - Covenant for Superior Court Foreclosure." If foreclosure proceedings were ever instituted, any mortgage or deed of trust holder could, but would not be required to, advance the amount of delinquent Special Taxes to protect its security interest. Tax Delinquencies Under provisions of the Act, the Special Taxes, from which funds necessary for the payment of principal of, and interest on, the 2013 Bonds are derived, are being billed to the taxable parcels within the District on the regular property tax bills sent to owners of the parcels. Such Special Tax installments are due and payable, and bear the same penalties and interest for non-payment, as do regular property tax installments. Special Tax installment payments cannot be made separately from property tax payments. Therefore, the unwillingness or inability of a property owner to pay regular property tax bills as evidenced by property tax delinquencies may also indicate an unwillingness or inability to make regular property tax payments and Special Tax installment payments in the future. See "SECURITY FOR THE 2013 BONDS— Reserve Fund" and "-Covenant for Superior Court Foreclosure" for a discussion of the provisions which apply, and procedures which the District is obligated to follow under the Fiscal Agent Agreement, in the event of delinquency in the payment of Special Tax installments. See also "THE DISTRICT'for historical Special Tax delinquency history. 46 P864 Risks Associated with Private Loan The property in each Zone of Improvement Area No. 2 is subject to a private loan secured by the real property in the Zone; as a matter of law, the lien securing the private loan is junior in priority to the lien securing the Special Tax obligation. In the event of a default by the property owner on its loan, whether as a result of a default in the payment of debt service on the loan or other material provisions of the loan agreement, the property's ownership could be transferred to the lender, as a result of foreclosure or otherwise. This could impact the management of the property and result in a failure to pay Special Taxes as they become due. The failure to pay Special Taxes would significantly hinder the District's ability to pay debt service on the 2013 Bonds because of the concentration of ownership in Improvement Area No. 2. See "—Concentration of Property Ownership" above. See the description of the loan agreement and the scheduled maturity dates in "IMPROVEMENT AREA NO. 2 —Land Owners." Bankruptcy Delays The payment of the Special Tax and the ability of the City, on behalf of the District, to commence a superior court action to foreclose the lien of a delinquent unpaid Special Tax, as discussed in "SECURITY FOR THE 2013 BONDS," may be limited by bankruptcy, insolvency or other laws generally affecting creditors' rights or by the laws of the State of California relating to judicial foreclosure. Any legal opinion to be delivered concurrently with the delivery of the 2013 Bonds (including Bond Counsel's approving legal opinion) will be qualified as to the enforceability of the various legal instruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors' rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases. Although bankruptcy proceedings would not cause the Special Taxes to become extinguished, bankruptcy of a property owner or any other person claiming an interest in the property could result in a delay in superior court foreclosure proceedings and could result in the possibility of Special Tax installments not being paid in part or in full. Such a delay would increase the likelihood of a delay or default in payment of the principal of and interest on the 2013 Bonds. Proceeds of Foreclosure Sales Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of any Special Tax, the City Council, as the legislative body of the District, may order that the Special Taxes be collected by a superior court action to foreclose the lien within specified time limits. The District has covenanted in the Fiscal Agent Agreement that the City will, under certain circumstances, commence such a foreclosure action. See "SECURITY FOR THE 2013 BONDS—Covenant for Superior Court Foreclosure." No assurances can be given that a taxable parcel in Improvement Area No. 2 that would be subject to a judicial foreclosure sale for delinquent Special Taxes will be sold or, if sold, that the proceeds of such sale will be sufficient to pay the delinquent Special Tax installment. Although the Act authorizes the District to cause such an action to be commenced and diligently pursued to completion, the Act does not specify any obligation of the District with regard to purchasing or otherwise acquiring any lot or parcel of property sold at the foreclosure sale in 47 P865 any such action if there is no other purchaser at such sale, and the District has not in any way agreed nor does it expect to be such a bidder. In a foreclosure proceeding, a judgment debtor (i.e., the property owner) has 140 days from the date of service of the notice of levy in which to redeem the property to be sold and may have other redemption rights afforded by law. If a judgment debtor fails to so redeem and the property is sold, his only remedy is an action to set aside the sale, which must be brought within 90 days of the. date of sale if the purchaser at the sale was the judgment creditor. If a foreclosure sale is thereby set aside, the judgment is revived and the judgment creditor is entitled to interest on the revived judgment as if the sale had not been made. If foreclosure proceedings were ever instituted, any holder of a mortgage or deed of trust on the affected property could, but would not be required to, advance the amount of tie delinquent Special Tax installment to protect its security interest. In the event such superior court foreclosure or foreclosures are necessary, there could be a delay in principal and interest payments to the owners of the 2013 Bonds pending prosecution of the foreclosure proceedings and receipt by the District of the proceeds of the foreclosure sale, if any. Judicial foreclosure actions are subject to the normal delays associated with court cases and may be further slowed by bankruptcy actions and other factors beyond the control of the District and City, including delay due to crowded local court calendars or legal tactics and, in any event could take several years to complete. In particular, bankruptcy proceedings involving the Landowner or any other owner of a taxable parcel in Improvement Area No. 2 could cause a delay, reduction or elimination in the flow of Special Tax Revenues to the Fiscal Agent. See "—Bankruptcy Delays." Natural Disasters The value of the Taxable Property in the future can be adversely affected by a variety of natural occurrences, particularly those that may affect infrastructure and other public improvements and private improvements on the Taxable Property and the continued habitability and enjoyment of such private improvements. Such occurrences include, without limitation, wildfire, earthquakes and floods. One or more of such natural disasters could occur and could result in damage to improvements of varying seriousness. The damage may entail significant repair or replacement costs and that repair or replacement may never occur either because of the cost, or because repair or replacement will not facilitate habitability or other use, or because other considerations preclude such repair or replacement. Under any of these circumstances, the value of the Taxable Property may well depreciate or disappear, or a substantial portion of the property owners may be unwilling or unable to pay the Special Taxes when due. The following paragraphs contain excerpts from the City's General Plan. Seismic Risk. While many natural and man-made hazards have the potential to impact the City, the event with the greatest potential for loss of life, property, and economic damage is an earthquake. The hazards associated with an earthquake in the City include ground shaking, fault rupture, landslides and foundation failures caused by liquefaction or settlement. Earthquakes can also trigger many secondary effects such as landslides and rock falls, urban fires, building collapse, water tank or dam failures, disruption of essential facilities and systems (water, sewer, gas, electricity, transportation, and communications), and hazardous materials releases. 48 P866 The City is located near two of California's most active faults, the San Andreas Fault and San Jacinto Fault. These faults are thought to have the highest probability of generating a large earthquake in the near future (up to 7.3 and 6.7 magnitude, respectively). While activity on the San Andreas Fault and San Jacinto Fault is considered more likely, a major earthquake (7.0 magnitude) on the Cucamonga Fault is assumed to be the worst-case earthquake scenario for the City. Ground displacements of up to 9 feet could occur along the fault, intense ground shaking could last more than 30 seconds, and losses could be extensive. Another major fault, traversing the City in a northeast direction, is the Red Hill Fault. This fault consists of three segments: (1) the Etiwanda Avenue Fault Scarp, which has been shown to be clearly active; (2) a southern section at the base of Red Hill with uncertain activity; and (3) a probable central segment that has not yet been located. The Etiwanda Avenue Fault Scarp (potential for 6.5 magnitude earthquake) is considered capable of ground shaking at an intensity that presents unacceptable risks to structures. The other two segments, not yet detected, could induce further damage. In 2002, the RMA Group was engaged by Forest City Development to complete a geotechnical investigation of the property within Improvement Area No. 2. The report states that since Improvement Area No. 2 is not located within the boundaries of an Earthquake Fault Zone and no faults are known to pass through Improvement Area No. 2, surface fault rupture within Improvement Area No. 2 is considered unlikely. Geologic Risk. The San Gabriel Mountains are among the fastest rising and fastest disintegrating mountain ranges in the world. Due to the City's proximity to the mountain range, these rapid changes make the City susceptible to geologic hazards including debris flows and falling rocks due to erosion of the steep slopes, concentration of precipitation from storms, and rapid stream flow from mountain streams, leading to increased potential for land subsidence in certain soil conditions. Flood Risk. The City, due to its location at the base of the San Gabriel Mountains, has a history of flooding. Many of the streets in the northern portion of the City have been known to flood. Comprehensive storm drain improvements and flood control projects have reduced the threat of floods somewhat, but not entirely. An unusually large storm and flash flooding can create flooding hazards within the City. The unpredictable range in seasonal rainfall that is typical of Southern California, coupled with the location near the San Gabriel Mountains, makes the City vulnerable to flooding during the winter storm season. To prepare and mitigate hazards from flooding, the City participates in the National Flood Insurance Program. Flood Insurance Rate Maps, or FIRMs, are prepared by the Federal Emergency Management Agency ("FEMA") to identify potential flood zones. The majority of the City is designated as located inside the 500-year floodplain in the minimum hazard area, with less than a 0.2% annual chance of flood hazard. Dam Inundation. Dam or catch basin failure could occur as a result of an earthquake, erosion, design flaw, or water overflow during storms, causing inundation in certain parts of the City. California law requires dam owners to provide the Governor's Office of Emergency Services with an inundation map showing the extent of damage to life and property that would occur given a complete and sudden dam failure at full capacity. 49 P867 There are four debris and water catch basins located within the City, and a small portion of the southwestern part of the City could be affected by a breach of the San Antonio Dam in Upland. The dam is a flood control and water conservation project constructed and operated by the U.S. Army Corps of Engineers. The Reservoir Hazard Study for the Cucamonga Valley Water District ("CVWD"), dated March 1989, evaluated the performance of CVWD's tanks under seismic loads from earthquakes on the nearby Cucamonga Fault and Red Hill Fault. Should a large earthquake occur on either of these faults, the study indicates than none of CVWD's water tanks will survive undamaged. Most (14) will suffer only broken pipe connections, 10 will probably suffer tears or seam breaks, and 2 will likely collapse. These findings are significant in their impact on fire flow and emergency storage following an earthquake. Inundation studies based on failures of CVWD's water tanks indicate that four of the projected reservoir failures will impact land that is currently vacant, three are expected to inundate one or two structures, and one reservoir site may inundate as many as 15 residences. Hazardous Substances The presence of hazardous substances on a parcel may result in a reduction in the value of a parcel. In general, the owners and operators of a parcel may be required by law to remedy conditions of the parcel relating to releases or threatened releases of hazardous substances. The Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as "CERCLA" or the "Superfund Act," is the most well-known and widely applicable of these laws, but California laws with regard to hazardous substances are also stringent and similar. Under many of these laws, the owner or operator is obligated to remedy a hazardous substance condition of property whether or not the owner or operator has anything to do with creating or handling the hazardous substance. The effect, therefore, should any of the taxed parcels be affected by a hazardous substance, is to reduce the marketability and value of the parcel by the costs of remedying the condition, because the purchaser, upon becoming owner, will become obligated to remedy the condition just as is the seller. The City has not independently verified, but is not aware of, the presence of any hazardous substances within Improvement Area No. 2. Disclosure to Future Purchasers The willingness or ability of an owner of a parcel to pay the Special Tax, even if the value of the property is sufficient to justify payment, may be affected by whether or not the owner was given due notice of the Special Tax authorization at the time the owner purchased the parcel, was informed of the amount of the Special Tax on the parcel should the Special Tax be levied at the maximum tax rate and, at the time of such a levy, has the ability to pay it as well as pay other expenses and obligations. The District has caused notices of the Special Tax to be recorded in the Office of the Recorder for the County against each parcel in Improvement Area No. 2. Although title companies normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if made, that a prospective purchaser or lender will consider such Special Tax obligation when purchasing a property within Improvement Area No. 2 or lending money secured by the property, as applicable. 50 P868 California Civil Code Section 1102.6b requires that, in the case of transfers, the seller must at least make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure by an owner of the property to comply with the above requirements, or failure by a purchaser or lessor to consider or understand the nature and existence of the Special Tax, could adversely affect the willingness and ability of the purchaser or lessor to pay the Special Tax when due. FDIC/Federal Government Interests in Properties General. The ability of the City, on behalf of the District, to foreclose the lien of delinquent unpaid Special Tax installments may be limited with regard to properties in which the Federal Deposit Insurance Corporation (the "FDIC"), the Drug Enforcement Agency, the Internal Revenue Service, or other federal agency has or obtains an interest. Federal courts have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if foreclosure would impair the federal government interest. The supremacy clause of the United States Constitution reads as follows: "This Constitution, and the Laws of the United States which shall be made in Pursuance thereof; and all Treaties made, or which shall be made, under the Authority of the United States, shall be the supreme Law of the Land; and the Judges in every State shall be bound thereby, any Thing in the Constitution or Laws of any State to the contrary notwithstanding." This means that, unless Congress has otherwise provided, if a federal governmental entity owns a parcel that is subject to Special Taxes within Improvement Area No. 2 but does not pay taxes and assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot foreclose on the parcel to collect the delinquent taxes and assessments. Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in the parcel and the District wishes to foreclose on the parcel as a result of delinquent Special Taxes, the property cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and assessments on a parity with the Special Taxes and preserve the federal government's mortgage interest. In Rust v. Johnson (9th Circuit; 1979) 597 F.2d 174, the United States Court of Appeal, Ninth Circuit held that the Federal National Mortgage Association ("FNMA") is a federal instrumentality for purposes of this doctrine, and not a private entity, and that, as a result, an exercise of state power over a mortgage interest held by FNMA constitutes an exercise of state power over property of the United States. The District has not undertaken to determine whether any federal governmental entity currently has, or is likely to acquire, any interest (including a mortgage interest) in any of the parcels subject to the Special Taxes within Improvement Area No. 2, and therefore expresses no view concerning the likelihood that the risks described above will materialize while the 2013 Bonds are outstanding. FDIC. In the event that any financial institution making any loan which is secured by real property within Improvement Area No. 2 is taken over by the FDIC, and prior thereto or thereafter the loan or loans go into default, resulting in ownership of the property by the FDIC, 51 P869 then the ability of the City to collect interest and penalties specified by State law and to foreclose the lien of delinquent unpaid Special Taxes may be limited. The FDIC's policy statement regarding the payment of state and local real property taxes (the "Policy Statement") provides that property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property's value, and that the FDIC is immune from real property taxes assessed on any basis other than property value. According to the Policy Statement, the FDIC will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as is consistent with sound business practice and the orderly administration of the institution's affairs, unless abandonment of the FDIC's interest in the property is appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (including interest) on FDIC-owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy, attachment, garnishment, foreclosure or sale without the FDIC's consent. In addition, the FDIC will not permit a lien or security interest held by the FDIC to be eliminated by foreclosure without the FDIC's consent. The Policy Statement states that the FDIC generally will not pay non-ad valorem taxes, including special assessments, on property in which it has a fee interest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Mello-Roos Act and a special tax formula which determines the special tax due each year are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC's federal immunity. The Ninth Circuit has issued a ruling on August 28, 2001 in which it determined that the FDIC, as a federal agency, is exempt from Mello-Roos special taxes. The District is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency in the payment of Special Taxes on a parcel within Improvement Area No. 2 in which the FDIC has or obtains an interest, although prohibiting the lien of the Special Taxes-to be foreclosed out at a judicial foreclosure sale could reduce or eliminate the number of persons willing to purchase a parcel at a foreclosure sale. Such an outcome could cause a draw on the Reserve Fund and perhaps, ultimately, if enough property were to become owned by the FDIC, a default in payment on the 2013 Bonds. No Acceleration Provision The 2013 Bonds and the Fiscal Agent Agreement do not contain a provision allowing for the acceleration of the 2013 Bonds in the event of a payment default or other default under the terms of the 2013 Bonds or the Fiscal Agent Agreement or in the event interest on the 2013 Bonds becomes included in gross income for federal income tax purposes. Taxability Risk As discussed herein under the caption "TAX MATTERS," interest on the 2013 Bonds could become includable in gross income for purposes of federal income taxation retroactive to the date the 2013 Bonds were issued, as a result of future acts or omissions of the District in 52 P870 violation of its covenants in the Fiscal Agent Agreement. There is no provision in the 2013. Bonds or the Fiscal Agent Agreement for special redemption or acceleration or for the payment of additional interest should such an event of taxability occur, and the 2013 Bonds will remain outstanding until maturity or until redeemed under one of the other redemption provisions contained in the Fiscal Agent Agreement. In addition, as discussed under the caption "TAX MATTERS," Congress has considered in the past, is currently considering and may consider in the future, legislative proposals, including some that carry retroactive effective dates, that, if enacted, would alter or eliminate the exclusion from gross income for federal income tax purposes of interest on municipal bonds, such as the 2013 Bonds. Prospective purchasers of the 2013 Bonds should consult their own tax advisors regarding any pending or proposed federal tax legislation. The District can provide no assurance that federal tax law will not change while the 2013 Bonds are outstanding or that any such changes will not adversely affect the exclusion of interest on the 2013 Bonds from gross income for federal income tax purposes. If the exclusion of interest on the 2013 Bonds from gross income for federal income tax purposes were amended or eliminated, it is likely that the market price for the 2013 Bonds would be adversely impacted. Enforceability of Remedies The remedies available to the Fiscal Agent and the registered owners of the 2013 Bonds upon a default under the Fiscal Agent Agreement or any other document described in this Official Statement are in many respects dependent upon regulatory and judicial actions that are often subject to discretion and delay. Under existing law and judicial decisions, the remedies provided for under such documents may not be readily available or may be limited. Any legal opinions to be delivered concurrently with the issuance of the 2013 Bonds will be qualified to the extent that the enforceability of the legal documents with respect to the 2013 Bonds is subject to limitations imposed by bankruptcy, reorganization, insolvency or other similar laws affecting the rights of creditors generally and by equitable remedies and proceedings generally. Judicial remedies, such as foreclosure and enforcement of covenants, are subject to exercise of judicial discretion. A California court may not strictly apply certain remedies or enforce certain covenants if it concludes that application or enforcement would be unreasonable under the circumstances and it may delay the application of such remedies and enforcement. No Secondary Market No representation is made concerning any secondary market for the 2013 Bonds. There can be no assurance that any secondary market will develop for the 2013 Bonds. Investors should understand the long-term and economic aspects of an investment in the 2013 Bonds and should assume that they will have to bear the economic risks of their investment to maturity. An investment in the 2013 Bonds may be unsuitable for any investor not able to hold the 2013 Bonds to maturity. Proposition 218 An initiative measure entitled the 'Right to Vote on Taxes Act' (the `Initiative") was approved by the voters of the State at the November 5, 1996 general election. The Initiative added Article XIIIC and Article XIIID to the California Constitution. According to the "Title and Summary' of the Initiative prepared by the California Attorney General, the Initiative limits `the authority of local governments to impose taxes and property-related assessments, fees and 53 P871 charges." Provisions of the Initiative have been and will continue to be interpreted by the courts. The Initiative could potentially impact the Special Taxes otherwise available to the District to pay the principal of and interest on the 2013 Bonds as described below. Among other things, Section 3 of Article XIIIC states, "...the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or charge." The Act provides for a procedure, which includes notice, hearing, protest and voting requirements to alter the rate and method of apportionment of an existing special tax. However, the Act prohibits a legislative body from adopting any resolution to reduce the rate of any special tax or terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Act unless such legislative body determines that the reduction or termination of the special tax would not interfere with the timely retirement of that debt. On July 1, 1997, the Governor of the State signed a bill into law enacting Government Code Section 5854, which states that: Section 3 of Article XIIIC of the California Constitution, as adopted at the November 5, 1996, general election, shall not be construed to mean that any owner or beneficial owner of a municipal security, purchased before or after that date, assumes the risk of, or in any way consents to, any action by initiative measure that constitutes an impairment of contractual rights protected by Section 10 of Article I of the United States Constitution. Accordingly, although the matter is not free from doubt, it is likely that Article XIIIC has not conferred on the voters the power to repeal or reduce the Special Taxes if such reduction would interfere with the timely retirement of the 2013 Bonds. It may be possible, however, for voters or the District or the City Council acting as the legislative body of the District to reduce the Special Taxes,in a manner that does not interfere with the timely repayment of the 2013 Bonds, but which does reduce the maximum amount of Special Taxes that may be levied in any year below the existing levels. Furthermore, no assurance can be given with respect to the future levy of the Special Taxes in amounts greater than the amount necessary for the timely retirement of the 2013 Bonds. Therefore, no assurance can be given with respect to the levy of Special Taxes for Administrative Expenses (as defined in the Fiscal Agent Agreement). Nevertheless, the District has covenanted that no modification of the minimum or maximum authorized Special Tax will be approved by the District nor will it take any other action that would (i) prohibit the District from levying the Special Tax within Improvement Area No. 2 of the District in any Fiscal Year at such a rate as would generate Special Tax Revenues (other than, in each Fiscal Year, up to the first $_,000 of Special Tax Revenues that may be deposited into the Administrative Expense Fund) in such Fiscal Year at least equal to 110% of Annual Debt Service on all Bonds then Outstanding; (ii) discontinue or cause the discontinuance of such levy; or (iii) permit the prepayment of the Special Tax except as permitted pursuant to the Rate and Method. However, no assurance can be given as to the enforceability of the foregoing covenant. The interpretation and application of Article XIIIC and Article XIIID will ultimately be determined by the courts with respect to a number of the matters discussed above, and it is not possible at this time to predict with certainty the outcome of such determination or the timeliness of any remedy afforded by the courts. See "—Enforceability of Remedies." 54 P872 Ballot Initiatives Articles XIIIC and XIIID of the California Constitution were adopted pursuant to measures qualified for the ballot pursuant to California's constitutional initiative process, and the State Legislature has in the past enacted legislation that has altered the spending limitations or established minimum funding provisions for particular activities. On March 6, 1995 in the case of Rossi v. Brown, the State Supreme Court held that an initiative can repeal a tax ordinance and prohibit the imposition of further such taxes and that the exemption from the referendum requirements does not apply to initiatives. From time to time, other initiative measures could be adopted by California voters or legislation enacted by the legislature. The adoption of any such initiative or legislation might place limitations on the ability of the State, the City, or local districts to increase revenues or to increase appropriations. TAX MATTERS In the opinion of Best Best & Krieger LLP, San Diego, California, Bond Counsel, subject, however, to the qualifications set forth below, under existing law, the interest on the 2013 Bonds is excluded from gross income for federal income tax purposes, and such interest is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations, provided, however, that, for the purpose of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining certain income and earnings. The opinions set forth in the preceding paragraph are subject to the condition that the Authority and the CFDs comply with all requirements of the Internal Revenue Code of 1986 (the "Code") that must be satisfied subsequent to the issuance of the 2013 Bonds in order that such interest be, or continue to be, excluded from gross income for federal income tax purposes. The Authority and the CFDs have covenanted to comply with each such requirement. Failure to comply with certain of such requirements may cause the inclusion of such interest in gross income for federal income tax purposes to be retroactive to the date of issuance of the 2013 Bonds. Bond Counsel expresses no opinion regarding other federal tax consequences arising with respect to the 2013 Bonds. In the further opinion of Bond Counsel, interest on the 2013 Bonds is exempt from California personal income taxes. To the extent the issue price of any maturity of the 2013 Bonds is less than the amount to be paid at maturity of such 2013 Bonds (excluding amounts stated to be interest and payable at least annually over the term of such 2013 Bonds), the difference constitutes "original issue discount," the accrual of which, to the extent properly allocable to each Owner thereof, is treated as interest on the 2013 Bonds which is excluded from gross income for federal income tax purposes and State of California personal income taxes. For this purpose, the issue price of a particular maturity of the 2013 Bonds is the first price at which a substantial amount of such maturity of the 2013 Bonds is sold to the public (excluding bond houses, brokers, or similar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers). The original issue discount with respect to any maturity of the 2013 Bonds accrues daily over the term to maturity of such 2013 Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to the adjusted basis of such 2013 Bonds to determine taxable gain or loss upon disposition (including sale, redemption, or payment on 55 P873 maturity) of such 2013 Bonds. Owners of the 2013 Bonds should consult their own tax advisors with respect to the tax consequences of ownership of 2013 Bonds with original issue discount, including the treatment of purchasers who do not purchase such 2013 Bonds in the original offering to the public at the first price at which a substantial amount of such 2013 Bonds is sold to the public. 2013 Bonds purchased, whether at original issuance or otherwise, for an amount greater than their principal amount payable at maturity (or, in some cases, at their earlier call date) ("Premium 2013 Bonds") will be treated as having amortizable bond premium. No deduction is allowable for the amortizable bond premium in the case of bonds, like the Premium 2013 Bonds, the interest on which is excluded from gross income for federal income tax purposes. However, a purchaser's basis in a Premium 2013 Bond, and under Treasury Regulations, the amount of tax exempt interest received will be reduced by the amount of amortizable bond premium properly allocable to such purchaser. Owners of Premium 2013 Bonds should consult their own tax advisors with respect to the proper treatment of amortizable bond premium in their particular circumstances. Owners of the 2013 Bonds should also be aware that the ownership or disposition of, or the accrual or receipt of interest on, the 2013 Bonds may have federal or state tax consequences other than as described above. 2013 Bond Counsel expresses no opinion regarding any federal or state tax consequences arising with respect to the 2013 Bonds other than as expressly described above. The complete text of the final opinion that Bond Counsel expects to deliver upon issuance of the 2013 Bonds is set forth in Appendix D. LEGAL MATTERS Concurrently with the issuance of the 2013 Bonds, Best Best & Krieger LLP, San Diego, California, Bond Counsel, will render its opinion substantially in the form set forth in Appendix D to this Official Statement. Certain legal matters with respect to the 2013 Bonds will be passed upon for the District by the City Attorney, and for the District by Jones Hall, A Professional Law Corporation, San Francisco, California, acting as Disclosure Counsel. Certain legal matters will be passed upon for the Underwriter by Stradling Yocca Carlson & Rauth, a Professional Corporation, Newport Beach, California. Payment of the fees and expenses of Bond Counsel, Disclosure Counsel and Underwriters Counsel is contingent on the issuance of the 2013 Bonds. NO RATING The District did not apply for or receive a rating for the 2013 Bonds. LITIGATION The District is not aware of any pending or threatened litigation challenging the validity of the 2013 Bonds, the Special Taxes securing the 2013 Bonds, or any action taken by the District in connection with the formation of the District or Improvement Area No. 2, the levying of the Special Taxes or the issuance of the 2013 Bonds. 56 P874 UNDERWRITING The 2013 Bonds are being purchased through negotiation by Stifel, Nicolaus & Company, Incorporated (the "Underwriter"). The Underwriter agreed to purchase the 2013 Bonds at a price of $ (which is equal to the par amount of the 2013 Bonds, less an original issue discount of $ , and less an underwriter's discount of $ ). The initial public offering prices set forth on the inside cover page may be changed by the Underwriter. The Underwriter may offer and sell the 2013 Bonds to certain dealers and others at prices lower than the public offering prices set forth on the inside cover page hereof. CONTINUING DISCLOSURE Continuing Disclosure Certificate of City. The City, for and on behalf of itself and the District, will covenant in a continuing disclosure certificate (the "City Continuing Disclosure Certificate"), for the benefit of the Owners of the 2013 Bonds to provide certain annual financial information and operating data, and to provide notices of the occurrence of certain enumerated events. The City will agree in its certificate to file, or cause to be filed, with the MSRB such report and notices. The covenants of the City have been made in order to assist the Underwriter in complying with the Rule. The City Continuing Disclosure Certificate is attached as Appendix E —"Form of City Continuing Disclosure Certificate" of this Official Statement. [confirm] The City has not failed to comply in any material respects with any undertaking under the Rule in the past five years. Continuing Disclosure Certificates of Foothill Crossing, LLC and Rancho BP, LLC. Each of Foothill Crossing, LLC, and Rancho BP, LLC (each, a "Property Owner") will covenant in a continuing disclosure certificate (each, a "Property Owner Continuing Disclosure Certificate'), for the benefit of holders and beneficial owners of the 2013 Bonds, to provide (i) on a semi-annual basis, certain information relating to itself and the parcels it owns within Improvement Area No. 2 and (ii) notices of the occurrence of certain enumerated events. Wells Fargo Bank, National Association, will initially act as the dissemination agent each Property Owner Continuing Disclosure Certificate. The obligations of each Property Owner under its Property Owner Continuing Disclosure Certificate will terminate on the earlier of (i) legal defeasance, prior redemption or payment in full of all the 2013 Bonds; (ii) the time that the property that it or any of its affiliates own within Improvement Area No. 2 is no longer responsible for payment of 20% or more of the Special Taxes in any Zone; or(iii) the date on which it prepays in full all the Special Taxes attributable to the property that it owns within Improvement Area No. 2. The Property Owner Continuing Disclosure Certificate is attached as Appendix F — "Form of Property Owner Continuing Disclosure Certificate" of this Official Statement. A default under either Property Owner Continuing Disclosure Certificate will not, by itself, constitute an Event of Default under the Fiscal Agent Agreement, and the sole remedy under the Property Owner Continuing Disclosure Certificate in the event of any failure of the obligated Property Owner to comply will be an action to compel specific performance. Neither the City nor the District has any obligation to enforce the continuing disclosure undertaking of either Property Owner. 57 P875 [confirm] Neither Property Owner has failed to comply in all material respects with any undertaking under the Rule in the past five years. 58 P876 MISCELLANEOUS Included herein are brief summaries of certain documents and reports, which summaries do not purport to be complete or definitive, and reference is made to such documents and reports for full and complete statements of the contents thereof. Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representations of fact. This Official Statement is not to be construed as a contract or agreement between the District or the City and the purchasers or Owners of any of the 2013 Bonds. The execution and delivery of this Official Statement has been duly authorized by the City Council, as the legislative body of the District. CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Authorized Representative 59 P877 APPENDIX A CITY OF RANCHO CUCAMONGA GENERAL DEMOGRAPHIC INFORMATION General The City of Rancho Cucamonga (the "City") is located in the foothills of the Los Angeles- San Bernardino Basin in the western portion of San Bernardino County, approximately 40 miles east of the City of Los Angeles and 18 miles west of the City of San Bernardino. The City Covers approximately 39.9 square miles and is bordered by Ontario on the south, Upland on the west and Fontana to the east; to the north are Cucamonga Peak and Mount Baldy. Municipal Government The City was incorporated on November 30, 1977, as a general law city operating under the council-manager form of government. It is governed by a five-member City Council (the "Council"), which includes a Mayor who is elected at large for a four-year term, and four Council Members are elected at large for staggered four-year terms. The Council appoints the City Manager and City Attorney. The City Manager is responsible for the daily administration of City affairs and for implementing Council policy and program decisions. Population Prior to incorporation, the area generally within the corporate boundaries of the City experienced a rapid growth in population. Population figures for the City, the County and the State for the last five years are shown in the following table. CITY OF RANCHO CUCAMONGA AND COUNTY OF SAN BERNARDINO Population Estimates City of County of State of Year Rancho Cucamonga San Bernardino California 2008 164,671 2,009,594 36,704,375 2009 164,764 2,019,432 36,966,713 2010 165,391 2,033,141 37,223,900 2011 167,701 2,046,619 37,427,946 2012 169,498 2,063,919 37,678,563 Source: State Department of Finance estimates(as of January 1) Employment The City is included in the Riverside—San Bernardino—Ontario Metropolitan Statistical Area ("MSA"). The unemployment rate in the Riverside-San Bernardino-Ontario MSA was 11.3% in November 2012, down from a revised 11.7% in October 2012, and below the year-ago estimate of 12.4%. This compares with an unadjusted unemployment rate of 9.6% for California and 7.4% for the nation during the same period. The unemployment rate was 11.5% in Riverside County, and 11.0% in San Bernardino County. A-1 P878 The following table summarizes the civilian labor force, employment and unemployment in the County for the calendar years 2007 through 2011. These figures are county-wide statistics and may not necessarily accurately reflect employment trends in the City. RIVERSIDE-SAN BERNARDINO-ONTARIO METROPOLITAN STATISTICAL AREA Civilian Labor Force, Employment and Unemployment (Annual Averages) 2007 2008 2009 2010 2011 Civilian Labor Force I'I 1,766,900 1,776,000 1,774,800 1,798,200 1,799,000 Employment 1,664,000 1,629,500 1,541,300 1,540,500 1,557,800 Unemployment 102,900 146,500 233,500 257,700 241,200 Unemployment Rate 5.8% 8.3% 13.2% 14.3% 13.4% Wage and Salary Employment: (2) Agriculture 16,400 15,900 14,900 15,000 14,900 Mining and Logging 1,300 1,200 1,100 1,000 1,000 Construction 112,500 90,700 67,900 59,700 58,700 Manufacturing 118,500 106,900 88,800 85,100 85,800 Wholesale Trade 56,800 54,100 48,900 48,600 49,400 Retail Trade 175,600 168,600 156,200 155,500 157,200 Transportation, Warehousing, 69,500 70,200 66,800 66,600 68,500 Utilities Information 15,400 14,900 15,100 15,800 15,000 Finance and Insurance 30,300 27,400 26,000 25,500 25,000 Real Estate and Rental and Leasing 19,500 18,700 16,600 15,500 14,200 Professional and Business Services 145,200 137,700 124,300 123,400 126,100 Educational and Health Services 127,200 131,800 133,600 133,800 137,900 Leisure and Hospitality 132,600 131,000 123,800 122,800 124,300 Other Services 41,200 40,800 37,300 38,200 39,300 Federal Government 19,400 19,600 20,600 22,700 21,200 State Government 28,700 29,600 29,800 29,300 29,100 Local Government 177,200 180,700 178,100 182,300 177,000 Total, All Industries(3) 1,287,300 1,239,700 1,149,700 1,140,900 1,144,600 (1) Labor force data is by place of residence; includes self-employed individuals, unpaid family workers, household domestic workers,and workers on strike. (2) Industry employment is by place of work; excludes self-employed individuals, unpaid family workers, household domestic workers,and workers on strike. (3) Totals may not add due to rounding. Source: Stale of California Employment Development Department. Between August 2010 and August 2011, total nonfarm employment decreased by 6,100 jobs. Agricultural employment declined by 200 jobs. • Government posted the greatest year-over decline with a loss of 12,600 jobs. The job losses in this industry included local government (down 11,700 jobs) and federal government (down 900 jobs). State government reported no change. Three other industry sectors also registered employment loss over the year. Leisure and hospitality (down 2,600 jobs), construction (down 1,400 jobs), and other services (down 700 jobs). A-2 P879 • Trade, transportation, and utilities reported the greatest year-over gain, adding 5,800 jobs. Transportation, warehousing, and utilities (up 2,700 jobs) accounted for more than 46 percent of the year-over growth. Wholesale trade increased by 1,800 jobs and retail trade gained 1,300 jobs. • The remaining industries all recorded year-over job gains, most significantly in educational and health services (up 2,700 jobs) and professional and business services (up 1,700 jobs). Major Employers The following table shows the major manufacturing and non-manufacturing employers within the City and their estimated number of employees as of June 30, 2011: CITY OF RANCHO CUCAMONGA Major Employers As of June 30, 2011 Company Type of Business No. of Employees Chaffey Community College Community College 1,763 Etiwanda School District School District 1,198 City of Rancho Cucamonga City Government 954 Alta Loma School District School District 942 Amphastar Pharmaceuticals Pharmaceutical Manufacturer 880 Southern California Edison Utilities 800 Mercury Insurance Company Insurance 606 West Coast Liquidators Variety Store 565 Frito-Lay, Inc. Snack Foods Manufacturer 561 CMC Steel Fabricators Steel Manufacturer 517 Source: City of Rancho Cucamonga, Finance Department, Comprehensive Annual Financial Report (CAFR), year ended June 30, 2011. A-3 P880 Commercial Activity In 2009, the State Board of Equalization converted the business codes of sales and use tax permit holders to North American Industry Classification System codes. As a result of the coding change, retail stores data for 2009 and after is not comparable to that of prior years. A summary of historic taxable sales within the City during the past five years in which data is available is shown in the following table. Total taxable sales during the first two quarters of calendar year 2011 in the City were reported to be $1,551,241,000, an 8.56 percent increase over the total taxable sales of $1,428,940,000 reported during the first three quarters of calendar year 2010. Annual figures for calendar year 2011 are not yet available. CITY OF RANCHO CUCAMONGA Taxable Transactions (figures in thousands) Retail Stores Total All Outlets Number Number of Permits Taxable of Permits Taxable on August 1 Transactions on August 1 Transactions 2006 1,785 1,831,336 3,533 2,386,137 2007 1,820 1,779,950 3,658 2,335,377 2008 1,865 1,632,054 3,741 2,220,503 20091'1 2,197 1,468,867 3,537 1,921,110 20101'1 2,407 1,504,740 3,780 1,962,697 (1) Not comparable to prior years. "Retail'category now includes"Food Services." Source: California State Board of Equalization,Taxable Sales in California(Sales&Use Tax). A summary of historic taxable sales within the County during the past five years in which data is available is shown in the following table. Total taxable sales during the first three quarters of calendar year 2011 in the County were reported to be $20,062,471,000, a 10.64 percent increase over the total taxable sales of $18,132,941,000 reported during the first two quarters of calendar year 2010. Annual figures for calendar year 2011 are not yet available. COUNTY OF SAN BERNARDINO Taxable Transactions Number of Permits and Valuation of Taxable Transactions (Dollars in Thousands) Retail Stores Total All Outlets Number Number of Permits Taxable of Permits Taxable on August 1 Transactions on August 1 Transactions 2006 24,755 22,130,160 46,528 31,309,905 2007 24,407 21,335,824 47,810 30,450,731 2008 25,076 19,065,786 48,994 27,777,703 20091'1 31,676 16,330,138 45,062 23,652,433 20101'1 34,068 17,308,880 47,562 24,687,862 (1) Not comparable to prior years. "Retail'category now includes"Food Services." Source: California State Board of Equalization,Taxable Sales in California (Sales&Use Tax). A-4 P881 Construction Activity Provided below are the building permits and valuations for the City and the County for calendar years 2007 through 2011. CITY OF RANCHO CUCAMONGA Total Building Permit Valuations (Valuations in Thousands) 2007 2008 2009 2010 2011 Permit Valuation New Single-family $135,917.9 $38,685.1 $51,367.3 $36,885.0 $49,375.1 New Multi-family 19,031.1 29,407.3 43,595.7 0.0 25,990.9 Res. Alterations/Additions 8,366.8 5.432.4 3.416.5 3,818.2 7.533.5 Total Residential 163,315.9 73,524.9 98,379.5 40,703.2 82,899.5 New Commercial 52,894.3 17,662.8 1,638.4 529.6 233.1 New Industrial 4,225.9 2,378.4 0.0 0.0 0.0 New Other 16,235.6 8,266.7 7,837.0 8,129.2 105.0 Com. Alterations/Additions 41,330.1 21,384.7 12,043.7 9.469.5 15,531.1 Total Nonresidential $114,685.8 $49,692.5 $21,519.1 $18,128.4 $15,869.2 New Dwelling Units Single Family 617 159 280 144 177 Multiple Family 179 302 468 0 192 TOTAL 796 461 748 144 369 Source: Construction Industry Research Board, Building Permit Summary. COUNTY OF SAN BERNARDINO Total Building Permit Valuations (Valuations in Thousands) 2007 2008 2009 2010 2011 Permit Valuation New Single-family $1,263,350.5 $383,615.0 $279,993.7 $233,404.1 $232,698.4 New Multi-family 155,820.1 102,257.4 96,741.5 61,080.8 49,011.4 Res.Alterations/Additions 128,336.1 86,585.0 62,858.9 62,731.0 99,082.5 Total Residential 1,547,506.7 572,457.3 439,594.1 357,215.9 380,792.3 New Commercial 569,354.4 310,847.8 70,373.4 39,380.8 67,146.5 New Industrial 350,521.0 92,200.4 34,028.5 21,853.6 50,629.8 New Other 190,362.6 100,797.4 72,127.6 62,614.4 6,404.5 Com. Alterations/Additions 255,984.2 234.970.0 156.292.0 129,150.1 197 960.7 Total Nonresidential $1,366,222.3 $738,815.6 $332,821.5 $252,998.9 $322,141.5 New Dwelling Units Single Family 6,239 1,981 1,441 1,198 1,075 Multiple Family 1 765 1 201 1 054 649 409 TOTAL 8,004 3,182 2,495 1,847 1,484 Source: Construction Industry Research Board, Building Permit Summary. A-5 P882 Effective Buying Income "Effective Buying Income" is defined as personal income less personal tax and nontax payments, a number often referred to as "disposable" or "after-tax' income. Personal income is the aggregate of wages and salaries, other labor-related income (such as employer contributions to private pension funds), proprietor's income, rental income (which includes imputed rental income of owner-occupants of non-farm dwellings), dividends paid by corporations, interest income from all sources, and transfer payments (such as pensions and welfare assistance). Deducted from this total are personal taxes (federal, state and local), nontax payments (fines, fees, penalties, etc.) and personal contributions to social insurance. According to U.S. government definitions, the resultant figure is commonly known as "disposable personal income." The following table summarizes the total effective buying income for the City, the County, the State and the United States for the period 2007 through 2011. CITY OF RANCHO CUCAMONGA; COUNTY OF SAN BERNARDINO Effective Buying Income As of January 1, 2007 through 2011 Median Total Effective Household Buying Income Effective Year Area (000's Omitted) Buying Income 2007 City of Rancho Cucamonga $3,971,740 $60,930 County of San Bernardino 33,455,520 44,276 California 814,894,438 48,203 United States 6,300,794,040 41,792 2008 City of Rancho Cucamonga $4,076,143 $63,140 County of San Bernardino 34,745,023 45,814 California 832,531,445 48,952 United States 6,443,994,426 42,303 2009 City of Rancho Cucamonga $4,076,843 $63,829 County of San Bernardino 34,899,738 45,690 California 844,823,319 49,736 United States 6,571,536,768 43,252 2010 City of Rancho Cucamonga $3,713,548 $59,587 County of San Bernardino 32,115,644 43,018 California 801,393,028 47,177 United States 6,365,020,076 41,368 2011 City of Rancho Cucamonga $3,827,855 $59,308 County of San Bernardino 32,969,928 42,818 California 814,578,458 47,062 United States 6,438,704,664 41,253 Source: The Nielsen Company(US), Inc. A-6 P883 APPENDIX B RATE AND METHOD B-1 P884 APPENDIX C SUMMARY OF THE FISCAL AGENT AGREEMENT C-1 P885 APPENDIX D FORM OF OPINION OF BOND COUNSEL D-1 P886 APPENDIX E FORM OF CITY CONTINUING DISCLOSURE CERTIFICATE CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 IMPROVEMENT AREA NO. 2 SPECIAL TAX REFUNDING BONDS, SERIES 2013 This CONTINUING DISCLOSURE CERTIFICATE (this "Disclosure Certificate") is executed and delivered by the City of Rancho Cucamonga, California (the "City"), on behalf of itself and the City of Rancho Cucamonga Community Facilities District No. 2003-01, Improvement Area No. 2 (the "District"), in connection with the execution and delivery of the bonds captioned above (the "2013 Bonds"). The 2013 Bonds are being executed and delivered pursuant to a Fiscal Agent Agreement, dated as of July 1, 2013 (the "Fiscal Agent Agreement"), by and between the District and Wells Fargo Bank, National Association, as fiscal agent. The City covenants and agrees as follows: Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and delivered by the City, on behalf of itself and the District, for the benefit of the holders and beneficial owners of the 2013 Bonds and in order to assist the Participating Underwriter in complying with Rule 15c2-12(b)(5) promulgated under the Securities Exchange Act of 1934, as amended. Section 2. Definitions. In addition to the definitions of capitalized terms set forth above and in Section 1.03 of the Fiscal Agent Agreement, which apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section 2, the following capitalized terms shall have the meanings ascribed to them below when used in this Disclosure Certificate: "Annual Report" means any Annual Report provided by the City pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate. "Annual Report Date" means the date that is seven months days after the end of the City's fiscal year(currently February 1 based on the City's fiscal year end of June 30). "Business Day' means any day on which the City is not required or authorized to be closed. "Dissemination Agent' means Wells Fargo Bank, National Association, or any successor Dissemination Agent designated in writing by the City and which has filed with the City a written acceptance of such designation. "Listed Events" means any of the events listed in Section 5(a) of this Disclosure Certificate. E-1 P887 "MSRB" means the Municipal Securities Rulemaking Board, which has been designated by the Securities and Exchange Commission as the sole repository of disclosure information for purposes of the Rule, or any other repository of disclosure information that may be designated by the Securities and Exchange Commission as such for purposes of the Rule in the future. "Official Statement" means the final official statement, dated , 2013, executed by the City in connection with the issuance of the 2013 Bonds. "Participating Underwriter" means Stifel, Nicolaus & Company, Incorporated, the original underwriter of the 2013 Bonds required to comply with the Rule in connection with offering of the 2013 Bonds. "Rule" means Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. Section 3. Provision of Annual Reports. (a) The City shall, or shall cause the Dissemination Agent to, not later than the Annual Report Date, commencing February 1, 2014, with the report for the 2012-13 fiscal year, provide to the MSRB, in an electronic format as prescribed by the MSRB, an Annual Report that is consistent with the requirements of Section 4 of this Disclosure Certificate. Not later than 15 Business Days prior to the Annual Report Date, the City shall provide the Annual Report to the Dissemination Agent (if other than the City). If by 15 Business Days prior to the Annual Report Date the Dissemination Agent (if other than the City) has not received a copy of the Annual Report, the Dissemination Agent shall contact the City to determine if the City is in compliance with the previous sentence. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 4 of this Disclosure Certificate; provided that the audited financial statements of the City may be submitted separately from the balance of the Annual Report, and later than the Annual Report Date, if not available by that date. If the City's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 5(b). The City shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by the City hereunder. (b) If the City does not provide (or cause the Dissemination Agent to provide) an Annual Report by the Annual Report Date, the City shall provide (or cause the Dissemination Agent to provide) to the MSRB, in an electronic format as prescribed by the MSRB, a notice in substantially the form attached as Exhibit A. (c) With respect to each Annual Report, the Dissemination Agent shall: (i) determine each year prior to the Annual Report Date the then-applicable rules and electronic format prescribed by the MSRB for the filing of annual continuing disclosure reports; and (ii) if the Dissemination Agent is other than the City, file a report with the City certifying that the Annual Report has been provided pursuant to this Disclosure Certificate, and stating the date it was provided. E-2 P888 Section 4. Content of Annual Reports. The City's Annual Report shall contain or incorporate by reference the following: (a) The City's audited financial statements prepared in accordance with generally accepted accounting principles as promulgated to apply to governmental entities from time to time by the Governmental Accounting Standards Board, together with the following statement: THE CITY'S ANNUAL FINANCIAL STATEMENT IS PROVIDED SOLELY TO COMPLY WITH THE SECURITIES EXCHANGE COMMISSION STAFF'S INTERPRETATION OF RULE 15C2-12 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED. NO FUNDS OR ASSETS OF THE CITY ARE REQUIRED TO BE USED TO PAY DEBT SERVICE ON THE 2013 BONDS, AND NEITHER THE CITY NOR THE DISTRICT IS OBLIGATED TO ADVANCE AVAILABLE FUNDS TO COVER ANY DELINQUENCIES. INVESTORS SHOULD NOT RELY ON THE FINANCIAL CONDITION OF THE CITY IN EVALUATING WHETHER TO BUY, HOLD OR SELL THE 2013 BONDS. If the City's audited financial statements are not available by the Annual Report Date, the Annual Report shall contain unaudited financial statements in a format similar to the financial statements contained in the final Official Statement, and the audited financial statements shall be filed in the same manner as the Annual Report when they become available. (b) Unless otherwise provided in the audited financial statements filed on or before the Annual Report Date, the following financial information and operating data with respect to the Community Facilities District, substantially similar to that provided in the Official Statement: Unless otherwise provided in the audited financial statements filed on or prior to the annual filing deadline for the Annual Reports provided for in Section 3 above, financial information and operating data with respect to the District for the preceding fiscal year, substantially similar to that provided in the corresponding tables and charts in the Official Statement for the 2013 Bonds, as follows: (i) For each Zone, the assessed value (per the San Bernardino County Assessor's records) of all parcels currently subject to the Special Tax within the Zone, showing the total assessed valuation for all parcels of Taxable Property (as defined in the RMA) as of the end of the most recently completed Fiscal Year, and the percent change from the prior Fiscal Year, substantially in the form of Table 3 of the Official Statement. (ii) For each Zone, with respect to delinquent Special Taxes in the Zone, delinquency information as of the end of the most recently completed Fiscal Year and the August 1 next preceding the related Annual Report Date, substantially in the form of Tables 6a and 6b of the Official Statement. (iii) The amount of prepayments of the Special Tax with respect to the District for the most recently completed Fiscal Year. (iv) For each Zone, a land ownership summary listing property owners responsible for more than 5% of the annual Special Tax levy in the Zone, as shown on the San Bernardino County Assessor's last equalized tax roll prior to the September next preceding the Annual Report Date, and a calculation of each such owner's value-to- burden ratio based upon assessed value and the burden of that property's share of the Special Tax Refunding Bonds only. E-3 P889 (v) The principal amount of the Bonds outstanding as of the September 30 next preceding the Annual Report Date. (vi) For each Zone, an updated calculation of the value-to-burden ratio on a Zone-specific basis in substantially the form of Tables 4a and 4b of the Official Statement, based upon (A) the Taxable Property's assessed value as shown on the San Bernardino County Assessor's last equalized tax roll prior to the September next preceding the Annual Report Date and (B) the burden of that property's share of the Bonds and overlapping debt. (vii) Any changes to the Rate and Method of Apportionment of Special Tax for the District. (viii) Annual information required to be filed by the City with the California Debt and Investment Advisory Commission pursuant to the Act and relating generally to outstanding bond amounts, fund balances, assessed values, special tax delinquencies and foreclosure information. (ix) If any, information relating to the number of new construction building permits and certificates of occupancy issued in the District during the preceding fiscal year. (c) In addition to any of the information expressly required to be provided under this Disclosure Certificate, the City shall provide such further material information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. (d) Any or all of the items listed above may be included by specific reference to other documents, including official statements of debt issues of the City or related public entities, which are available to the public on the MSRB's Internet web site or filed with the Securities and Exchange Commission. The City shall clearly identify each such other document so included by reference. Section 5. Reporting of Significant Events. (a) The City shall give, or cause to be given, notice of the occurrence of any of the following Listed Events with respect to the 2013 Bonds: (1) Principal and interest payment delinquencies. (2) Non-payment related defaults, if material. (3) Unscheduled draws on debt service reserves reflecting financial difficulties. (4) Unscheduled draws on credit enhancements reflecting financial difficulties. (5) Substitution of credit or liquidity providers, or their failure to perform. E-4 P890 (6) Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax status of the security, or other material events affecting the tax-exempt status of the security. (7) Modifications to rights of security holders, if material. (8) Bond calls, if material, and tender offers. (9) Defeasances. (10) Release, substitution, or sale of property securing repayment of the securities, if material. (11) Rating changes. (12) Bankruptcy, insolvency, receivership or similar event of the City. (13) The consummation of a merger, consolidation, or acquisition involving the City or the sale of all or substantially all of the assets of the City, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms, if material. (14) Appointment of a successor or additional fiscal agent or the change of name of a fiscal agent, if material. (b) Whenever the City obtains knowledge of the occurrence of a Listed Event, the City shall, or shall cause the Dissemination Agent (if not the City) to, file a notice of such occurrence with the MSRB, in an electronic format as prescribed by the MSRB, in a timely manner not in excess of 10 business days after the occurrence of the Listed Event. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(8) and (9) above need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to holders of affected 2013 Bonds under the Indenture. (c) The City acknowledges that the events described in subparagraphs (a)(2), (a)(7), (a)(8) (if the event is a bond call), (a)(10), (a)(13), and (a)(14) of this Section 5 contain the qualifier "if material." The City shall cause a notice to be filed as set forth in paragraph (b) above with respect to any such event only to the extent that the City determines the event's occurrence is material for purposes of U.S. federal securities law. (d) For purposes of this Disclosure Certificate, any event described in paragraph (a)(12) above is considered to occur when any of the following occur: the appointment of a receiver, fiscal agent, or similar officer for the City in a proceeding under the United States Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has assumed jurisdiction over substantially all of the assets or business of the City, or if such jurisdiction has been. assumed by leaving the existing governing body and officials or officers in possession but sbject to the supervision and orders of a court or governmental E-5 P891 authority, or the entry of an order confirming a plan of reorganization, arrangement, or liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or business of the City. Section 6. Identifying Information for Filings with the MSRB. All documents provided to the MSRB under the Disclosure Certificate shall be accompanied by identifying information as prescribed by the MSRB. Section 7. Termination of Reporting Obligation. The City's obligations under this Disclosure Certificate shall terminate upon the legal defeasance, prior redemption or payment in full of all of the 2013 Bonds. If such termination occurs prior to the final maturity of the 2013 Bonds, the City shall give notice of such termination in the same manner as for a Listed Event under Section 5(b). Section 8. Dissemination Agent. The City may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may discharge any Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be Wells Fargo Bank, National Association. Any Dissemination Agent may resign by providing 30 days' written notice to the City. Section 9. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the City may amend this Disclosure Certificate, and any provision of this Disclosure Certificate may be waived, provided that the following conditions are satisfied: (a) if the amendment or waiver relates to the provisions of Sections 3(a), 4 or 5(a), it may only be made in connection with a change in circumstances that arises from a change in legal requirements, change in law, or change in the identity, nature, or status of an obligated person with respect to the 2013 Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the 2013 Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver either (i) is approved by holders of the 2013 Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of holders, or (ii) does not, in the opinion of nationally recognized bond counsel, materially impair the interests of the holders or beneficial owners of the 2013 Bonds. If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first Annual Report filed pursuant hereto containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. If an amendment is made to this Disclosure Certificate modifying the accounting principles to be followed in preparing financial statements, the Annual Report for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the E-6 P892 basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information, in order to provide information to investors to enable them to evaluate the ability of the City to meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of any amendment made pursuant to this Section 9 shall be filed in the same manner as for a Listed Event under Section 5(b). Section 10. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent the City from disseminating any other information, using the means of dissemination set forth in this Disclosure Certificate or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Certificate. If the City chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the City shall have no obligation under this Disclosure Certificate to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. Section 11. Default. If the City fails to comply with any provision of this Disclosure Certificate, the Participating Underwriter or any holder or beneficial owner of the 2013 Bonds may take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the City to comply with its obligations under this Disclosure Certificate. A default under this Disclosure Certificate shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Certificate in the event of any failure of the City to comply with this Disclosure Certificate shall be an action to compel performance. Section 12. Duties Immunities and Liabilities of Dissemination Agent. (a) The Dissemination Agent shall have only such duties as are specifically set forth in this Disclosure Certificate, and the City agrees to indemnity and save the Dissemination Agent, its officers, directors, employees and agents, harmless against any loss, expense and liabilities which they may incur arising out of or in the exercise or performance of its powers and duties hereunder, including the costs and expenses (including attorneys fees) of defending against any claim of liability, but excluding liabilities due to the Dissemination Agent's negligence or willful misconduct. The Dissemination Agent shall have no duty or obligation to review any information provided to it by the City hereunder, and shall not be deemed to be acting in any fiduciary capacity for the City, the Bond holders or any other party. The obligations of the City under this Section shall survive resignation or removal of the Dissemination Agent and payment of the 2013 Bonds. (b) The Dissemination Agent shall be paid compensation by the City for its services provided hereunder in accordance with its schedule of fees as amended from time to time, and shall be reimbursed for all expenses, legal fees and advances made or incurred by the Dissemination Agent in the performance of its duties hereunder. Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the City, the Dissemination Agent, the Participating Underwriter and the holders and beneficial owners from time to time of the 2013 Bonds, and shall create no rights in any other person or entity. E-7 P893 Date: , 2013 CITY OF RANCHO CUCAMONGA, CALIFORNIA, for and on behalf of CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Name: Title: WELLS FARGO BANK, NATIONAL ASSOCIATION, as Dissemination Agent By: Name: Title: E-8 P894 EXHIBIT A NOTICE OF FAILURE TO FILE ANNUAL REPORT Name of Issuer: City of Rancho Cucamonga Community Facilities District No. 2003-01 Name of Issue: City of Rancho Cucamonga Community Facilities District No. 2003-01 Improvement Area No. 2Special Tax Refunding Bonds, Series 2013 Date of Issuance: _' 2013 NOTICE IS HEREBY GIVEN that the City has not provided an Annual Report with respect to the above-named 2013 Bonds as required by Section 5.15 of the Fiscal Agent Agreement, dated as of July 1, 2013, by and between the District and Wells Fargo Bank, National Association, as fiscal agent. The City anticipates that the Annual Report will be filed by Dated: CITY OF RANCHO CUCAMONGA, CALIFORNIA, for and on behalf of CITY OF RANCHO CUCAMONGA COMMUNITY FACILITIES DISTRICT NO. 2003-01 By: Its: E-9 P895 APPENDIX F FORM OF PROPERTY OWNER CONTINUING DISCLOSURE CERTIFICATE F-1 P896 APPENDIX G DTC AND THE BOOK-ENTRY ONLY SYSTEM The information in this Appendix G has been provided by The Depository Trust Company("DTC"), New York, NY, for use in securities offering documents, and the District does not take responsibility for the accuracy or completeness thereof. The District cannot and does not give any assurances that DTC, DTC Participants or Indirect Participants will distribute the Beneficial Owners either (a) payments of interest, principal or premium, if any, with respect to the 2013 Bonds or (b) certificates representing ownership interest in or other confirmation of ownership interest in the 2013 Bonds, or that they will so do on a timely basis or that DTC, DTC Direct Participants or DTC Indirect Participants mill act in the manner described in this Official Statement. The following description of DTC, the procedures and record keeping with respect to beneficial ownership interests in the 2013 Bonds, payment of principal, interest and other payments on the 2013 Bonds to DTC Participants or Beneficial Owners, confirmation and transfer of beneficial ownership interest in the 2013 Bonds and other related transactions by and between DTC, the DTC Participants and the Beneficial Owners is based solely on information provided by DTC. Accordingly, no representations can be made concerning these matters and neither the DTC Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but should instead confirm the same with DTC or the DTC Participants, as the case may be. Neither the issuer of the 2013 Bonds (the `Issuer') nor the trustee, fiscal agent or paying agent appointed with respect to the 2013 Bonds (the "Agent') take any responsibility for the information contained in this Appendix. No assurances can be given that DTC, DTC Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal or premium, if any, with respect to the 2013 Bonds, (b) certificates representing ownership interest in or other confirmation or ownership interest in the 2013 Bonds, or(c) redemption or other notices sent to DTC or Cede & Co., its nominee, as the registered owner of the 2013 Bonds, or that they will so do on a timely basis, or that DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Appendix. The current "Rules" applicable to DTC are on file with the Securities and Exchange Commission and the current "Procedures" of DTC to be followed in dealing with DTC Participants are on file with DTC. 1. The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the 2013 Bonds (the "Securities"). The Securities will be issued as fully-registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully-registered Security certificate will be issued for each issue of the Securities, each in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue. G-1 P897 2. DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). On August 8, 2011, Standard & Poor's downgraded its rating of DTC from AAA to AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at www.dtcc.com and www.dtc.org. The information contained on this Internet site is not incorporated herein by reference. 3. Purchases of Securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the Securities on DTC's records. The ownership interest of each actual purchaser of each Security ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in Securities, except in the event that use of the book-entry system for the Securities is discontinued. 4. To facilitate subsequent transfers, all Securities deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such Securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. 5. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or G-2 P898 regulatory requirements as may be in effect from time to time. Beneficial Owners of Securities may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Securities, such as redemptions, tenders, defaults, and proposed amendments to the Security documents. For example, Beneficial Owners of Securities may wish to ascertain that the nominee holding the Securities for their benefit has agreed to obtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. 6. Redemption notices shall be sent to DTC. If less than all of the Securities within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed. 7. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to Securities unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts Securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). 8. Redemption proceeds, distributions, and dividend payments on the Securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from Issuer or Agent, on payable date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC, Agent, or Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of Issuer or Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. 9. DTC may discontinue providing its services as depository with respect to the Securities at any time by giving reasonable notice to Issuer or Agent. Under such circumstances, in the event that a successor depository is not obtained, Security certificates are required to be printed and delivered. 10. Issuer may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, Security certificates will be printed and delivered to DTC. 11. The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that Issuer believes to be reliable, but Issuer takes no responsibility for the accuracy thereof. G-3 P899 APPENDIX H FOOTHILL CROSSING LLC INCOME STATEMENT (2011 AND 2012) Income Statement(Cash) Foothill Crossing LLC Calendar Years 2011 and 2012 Calendar Year Calendar Year 2011 % 2012 % REVENUE RETAIL RENT REVENUE Retail Rent $4,421,800.63 89.88 $4,143,170.30 89.68 Vacancy Loss-Retail (21,811.89) (0.44) (23,076.10) (0.50) Percentage Rent 71,998.90 1.46 97,322.60 2.11 Rent Concessions (109,061.44) (2.22) (140,782.80) (3.05) TOTAL RETAIL RENT REVENUE $4,362,926.20 88.68 $4,076,634.00 88.24 CAM REVENUE Monthly Estimated CAM Income $532,189.89 10.82 $532,591.80 11.53 Monthly Estimated CAM Loss (20,173.56) (0.41) (11,092.00) (0.24) Tax Recovery Income 29,935.24 0.61 30,061.77 0.65 Insurance Recovery Income 14,735.70 0.30 16,407.80 0.36 CAM Reconciliation - (27,729.70) (0.60) TOTAL CAM REVENUE $556,687.27 11.31 $540,239.67 11.69 Add'I Administration Fee - - $2,500.00 0.05 TOTAL OTHER REVENUE - - $2,500.00 0.05 ADMINISTRATIVE REVENUE Interest Income 304.09 0.01 337.65 0.01 TOTAL ADMINISTRATIVE REVENUE 304.09 0.01 337.65 0.01 TOTAL REVENUE $4,919,917.56 100.00 $4,619,71132 100.00 GENERAL&ADMINISTRATIVE EXPENSES GENERALEXPENSES Delivery/Messenger $60.38 - $214.19 - Filing Fees 203.70 - 77.12 - Miscellaneous General Expense 150.00 - 479.30 0.01 Finance Charge 1,532.29 0.03 42.56 - TOTAL GENERAL EXPENSES $1,946.37 0.04 $813.17 0.02 PROFESSIONAL FEES Professional Fees - - 1,029.00 0.02 TOTAL PROFESSIONAL FEES - - 1,029.00 0.02 TRAVEL& ENTERTAINMENT Meals $60.04 - Employee Mileage 639.36 0.01 $213.12 - TOTAL TRAVEL&ENTERTAINMENT $699.40 0.01 $213.12 - OTHER ADMINISTRATIVE Charitable Donations $15,601.10 0.32 - - TOTAL OTHER ADMINISTRATIVE $15,601.10 0.32 - - TOTAL GENERAL&ADMINISTRATIVE EXPENSES $18,246.87 0.37 $2,055.29 0.04 H-1 P900 Calendar Year Calendar Year 2011 % 2012 % DEVELOPMENT CAM(MASTER POOL) UTILITY EXPENSES Electric CAM $24,651.36 0.50 $26,257.89 0.57 Water-PAD 11,818.21 0.24 11,388.71 0.25 Water CAM - - 16,181.70 0.35 Irrigation-CAM 17,934.52 0.36 10,407.69 0.23 TOTAL UTILITIES $54,404.09 1.11 $64,235.99 1.39 EXTERIOR BUILDING Trash Removal-PAD $25,043.44 0.51 $24,461.90 0.53 Dumping/Hauling 435.00 0.01 - - Roof Repairs CAM 5,750.87 0.12 700.00 0.02 Fire Monitoring CAM 1,104.00 0.02 3,068.64 0.06 Fire Monitoring-PAD 12,076.90 0.25 8,967.70 0.19 TOTAL EXTERIOR BUILIDING $44,410.21 0.90 $37,198.24 0.81 GENERAL REPAIRS&MAINTENANCE Repair& Maintenance Contract CAM $516.50 0.01 $485.00 0.01 Maintenance Supplies CAM 135.50 - - - Electrical-Contract CAM 6,095.20 0.12 4,383.98 0.09 Electrical Supplies CAM 12,329.08 0.25 12,363.68 0.27 Painting CAM 825.00 0.02 1,236.90 0.03 Plumbing CAM 4,702.62 0.10 1,438.90 0.03 Pest Control CAM 8,633.00 0.18 9,987.00 0.22 Porter Service CAM 11,100.00 0.23 11,100.00 0.24 TOTAL GENERAL REPAIRS&MAINTENANCE $44,336.90 0.90 $40,995.46 0.89 PARKING LOT Parking Lot CAM $15,111.50 0.31 $7,863.90 0.17 Pressure Wash CAM 14,664.00 0.30 14,814.00 0.32 TOTAL PARKING LOT $29,775.50 0.61 $22,677.90 0.49 LANDSCAPING&GROUNDS Landscaping Contract CAM $49,394.00 1.00 $44,153.25 0.96 Landscaping Supplies CAM 2,297.49 0.05 8,043.16 0.17 TOTAL LANDSCAPING&GROUNDS $51,691.49 1.05 $52,196.41 1.13 MANAGEMENT EXPENSE Management Fee(1) $169,328.94 3.44 $151,573.44 3.28 Management Fee(2) 22,225.56 0.45 57,321.39 1.24 Property Management(salaries) 41,214.88 0.84 61,458.78 1.33 TOTAL MANAGEMENT EXPENSE $232,769.38 4.73 $270,353.61 5.85 TAXES& INSURANCE Property Taxes-PAD $159,190.44 3.24 $159,917.72 3.46 Property Taxes-Reimbursed 29,935.23 0.61 30,061.78 0.65 Property/General Liab. Ins-PAD 52,705.00 1.07 58,708.00 1.27 Property/General Liab. Ins-Reimbursed 13,594.00 0.28 15,104.00 0.33 Property/General Liab. Ins-Un-reimbursed 5,947.00 0.12 6,117.00 0.13 TOTAL TAXES& INSURANCE $261,371.67 5.31 $269,908.50 5.84 TOTAL DEV CAM(MASTER) $718,759.24 14.61 $757,566.11 16.40 TOTAL CAM OPERATING EXPENSES $718,759.24 14.61 $757,566.11 16.40 NON CAM EXPENSES NON-CAM LANDLORD EXPENSE: Repairs& Maintenance - - $1,260.00 0.03 H-2 P901 Calendar Year Calendar Year 2011 % 2012 % Professional Fee $759.20 0.02 8,574.00 0.19 Other-Non-CAM Landlord Expense 132,624.00 2.70 77,364.00 1.67 TOTAL NON-CAM LANDLORD EXPENSES $133,383.20 2.71 $87,198.00 1.89 TOTAL NON-CAM EXPENSES $133,383.20 2.71 $87,198.00 1.89 TOTAL OPERATING EXPENSES $870,389.31 17.69 $846,819.40 18.33 NET OPERATING INCOME $4,049,528.25 82.31 $3,772,891.92 81.67 INTEREST EXPENSE, FINANCE RELATED FEES& TAXES Letter of Credit Fees $2,500.00 0.05 $4,445.00 0.10 Mortgage Interest 875,157.78 17.79 788,987.52 17.08 State Franchise Tax 6,800.00 0.14 6,800.00 0.15 Depreciation 533,862.00 10.85 - - Amortization 83,016.00 1.69 - - TOTAL INTEREST EXPENSE $1,501,335.78 30.52 $800,232.52 17.32 NET INCOME BEFORE DEPRECIATION $2,548,192.47 51.79 $2,972,659.40 64.35 NET INCOME $2,548,192.47 - $2,972,659.40 - H-3 P902 STAFF REPORT ENGINEERING SERVICES DEPARTMENT ' Date: July 3, 2013 RANCHO To: Mayor and Members of the City Council CUCAMONGA John R. Gillison, City Manager From: Mark A. Steuer, Director of Engineering Services/City Engineer By: Jason C. Welday, Traffic Engineer Subject: APPROVAL OF A "PERMIT PARKING DISTRICT" FOR THE RESIDENTIAL AREA IDENTIFIED AS "ALMOND STREET" GENERALLY LOCATED EAST OF SAPPHIRE STREET RECOMMENDATION It is recommended that City Council adopt the attached resolution approving a Permit Parking District for the area shown in the Proposed Plan, and authorize the Mayor and the City Clerk to sign said resolution. BACKGROUND/ANALYSIS Situated in the foothills above the northwest portion of the City, Cucamonga Canyon and it's beautiful streams, waterfalls and riparian habitats have been an attraction for people for many years. The area has seen its share of problems common when people misuse the environment or put themselves in dangerous situations due to lack of preparation or judgment. Until 2009 these issues were sporadic and generally not a major problem for the community. In 2009 it was brought to the City's attention that the area was experiencing a dramatic increase in use, due to social media, and the impacts of that use were negatively affecting residential neighborhoods near the access point into the Canyon. City staff, including the Fire District, Police Department, and Public Works Department began discussing the matter with concerned residents in search of both short and long term solutions. Staff observed the conditions that were concerning residents and noted increased trash, graffiti, evidence of fire rings and other issues detrimental to the quality of life in the neighborhoods and the environment. Additionally, with the increased use of the area the Fire District noticed a commensurate increase in rescue calls in the Canyon. Rancho Cucamonga Police Department deputies conducted initial enforcement actions and surveyed Canyon visitors and learned that the majority were not Rancho Cucamonga residents and they had heard of the Canyon primarily through various social media outlets. Staff sought input and feedback with other stakeholder agencies including the US Forest Service, CVWD, utility agencies, the County Supervisor's office as well as the local Congressional office. Long term solutions have been difficult to implement and are still being pursued. Several short term efforts have been made in the interim to mitigate some of the problems caused by the people accessing the Canyon (also called Sapphire Falls). In late 2009, the neighborhood (Crestview Place / Inspiration Drive / Skyline Road) most directly impacted by the issue sought and received approval for a Permit Parking District. This was successful in moving vehicles and much of the pedestrian traffic (and associated problems) out of their neighborhood. The City opened an area on Almond Street west of Sapphire Street along its public easement to accommodate the cars that were now prevented from parking in the nearby residential neighborhood. This was initially successful, but the massive rains of December 2010 washed out the traditional access to the waterfalls via the Cucamonga Wash and led to people once again flocking through the adjacent neighborhoods in even greater numbers than before in the summer of 2011. P9O3 CITY COUNCIL STAFF REPORT - PERMIT PARKING DISTRICT July 3, 2013 Page 2 It was also ultimately brought to the City's attention that opening up the area for additional parking had an overall negative impact on the issue as it drew even more visitors in an area that is simply not designed to handle such crowds and contributed to trespassing across private property. With this information additional meetings with neighbors (including a Council Town Hall meeting) and other stakeholders resulted in a more comprehensive effort at enforcing the trespassing laws in the area with the goal to channel visitors into the Canyon via the one and only legal route which is along Skyline Road /Big Tree Road over a Forest Service easement. This also included discontinuing most of the parking allowed on Almond Street except for a limited on-street area. A staff report was presented to Council at the December 19, 2012 meeting detailing the results of these efforts and plans for additional measures for 2013. In accordance with those plans and in preparation for the influx of visitors to the Canyon during this year's Summer Season, City and Fire District staff along with Police Department staff evaluated the capacity of the Canyon along with the education and enforcement efforts from last year in order to make recommendations for improvements. Fire District and Police Department staff have estimated that the Canyon and area can safely hold approximately 100 visitors at any given time, including appropriate provisions for emergency response. As well, based on observations and statistics from previous years, it is apparent that the number of visitors continues to grow each year and along with the additional visitors, the impacts to the residents in the area, such as blocking of driveways, generation of a significant amount of noise, hostile confrontation with residents, and depositing of trash and litter have increased as well. In order to address the need to control the number of visitors to the Canyon and their impacts, staff prepared a preliminary plan to designate a fixed number of legal parking spaces on Almond Street west of Sapphire Street. To ensure that the designation of legal parking spaces would have the intended affect of controlling the number of visitors and would not move the problem into adjacent streets, the preliminary plan also proposed the establishment of a Permit Parking District that would have include portions of Sapphire Street, Almond Street, Whirlaway Street, Vicara Drive, La Senda Road, Via Serena, La Colina Drive, and Via Paraiso as shown on the attached map entitled "Original Proposed Plan". On June 5, 2013, residents with properties fronting the streets listed above were mailed a letter describing the Preliminary Plan and requesting feedback. As of June 26, 2013, staff has received a total of sixty one (61) responses from area residents. While the Preliminary Plan was overwhelmingly opposed by eighty four percent (84%) of those who responded, staff did receive six (6) responses in favor of the Preliminary Plan in the area north of Almond Street and east of Sapphire Street. The responses opposed to the Preliminary Plan were generally based on the inconvenience and expense of obtaining and maintaining parking permits that would be borne by residents in order to control the impacts of Canyon visitors. In addition to the sixty one (61) responses received in person, by email, or by phone, the City has also received the attached petition signed by fifteen (15) residents on Bella Vista Drive (private) east of Sapphire Street. The petition seeks to, "remove parking restrictions on Almond St. west of Henry St. and remove parking restrictions on Skyline Rd., open up access for foot traffic to the floor of Cucamonga Canyon from west Almond St., install "NO PARKING" signs on north Sapphire St. and on Almond St. east of Henry St." The following is staffs analysis and recommendations regarding the requests in the petition. P9O4 CITY COUNCIL STAFF REPORT - PERMIT PARKING DISTRICT July 3, 2013 Page 3 • Reinstatement of Parking on the South Side of Almond Street west of Henry Street - The request to allow parking on the south side of Almond Street west of Henry was also expressed by many of the residents who provided feedback. While this approach would provide a greater amount of available parking on Almond Street, the previous attempt at using this area for parking resulted in an overall negative impact to the area and the Canyon as stated above, contributed to trespassing and increased the need for additional police and fire resources and responses. • Removal of Parking Restrictions on Skyline Road — As stated above, the Permit Parking District on Skyline Road was established in late 2009 as a result of a petition signed by seventy five percent (75%) or more of the residents on Skyline Road. Removal of this street from the district can only occur by a resolution of the City Council. At this time, there has not been a request from the affected residents to be removed from the district and the City Council has never before removed a district involuntarily against the wishes of the residents. • Allow Access to the Canyon from Almond Street—Access to the Canyon via Almond Street would require that hikers cross CVWD property. At this time, CVWD has a trespassing order in place and is not permitting access across their property. In addition, there is no legal trail on the CVWD or Flood Control property in the wash. Further, past experience showed that significant numbers of people who parked on Almond Street trespassed across other private property in the area in order to get down into the Canyon. • Install "No Parking" signs on Sapphire Street and on Almond Street east of Henry Street — The requested restrictions would eliminate all parking on these streets including that by residents. The Preliminary Plan had included a Permit Parking District on Sapphire Street, but was removed from the Proposed Plan based on resident feedback as discussed below. Prohibiting even resident parking would be more restrictive than what was already voted down by most area residents. • Long Term Solution — Work is still underway on a long-term plan which would provide a parking area outside of all residential neighborhoods, access along a legal and safe trail system, appropriate signage and patrol of the Canyon, and ensure a safe and enjoyable time for everyone who visited Cucamonga Canyon. Moving more parking onto Almond Street, and channeling people into the lower Canyon, would be counterproductive to the long-term plan for the area. Based on this feedback, the Preliminary Plan was revised. The Proposed Plan would include the designation of legal parking spaces on Almond Street west of Sapphire Street and creation of a Permit Parking District on Almond Street east of Sapphire Street as shown on the attached map entitled "Final Proposed Plan". A second letter was mailed to area residents on June 27, 2013 providing information on the Proposed Plan and including a copy of the attached "Engineer's Recommendations and Report". The Permit Parking District will be posted to restrict all parking except by permit at all times. Any vehicle parked within this Permit Parking District without a permit is subject to being cited, unless it is an exempt vehicle as defined by the ordinance. An example of an exempt vehicle would be a vehicle belonging to a landscaping maintenance contractor in the process of doing his work or a delivery truck making a delivery. The City's Municipal Code, Chapter 10.50, outlines the procedures for establishing a Permit Parking District. The code also provides for the City Engineer to create forms, rules and procedures necessary to manage a Permit Parking Program for a specific district. The forms, rules and procedures are attached to the Resolution establishing the Permit Parking District, and are entitled, "Engineer's Recommendation and Report". P9O5 CITY COUNCIL STAFF REPORT - PERMIT PARKING DISTRICT July 3, 2013 Page 4 While the Proposed Plan may not fully address the issues identified, it will assist those residents north of Almond Street in controlling the affects of Canyon visitors within their neighborhood. In addition to these efforts, staff is continuing to work with interested parties to provide more permanent solutions in the future. The attached resolution has been reviewed as to form by the City Attorney, and is acceptable for approval. Respec mitted, Mark A. Steuer Director of Engineering Services/City Engineer MAS/JCW:rIf c: Original Proposed Plan Final Proposed Plan Resolution Engineer's Recommendation and Report Petition P906 du 'p NJ bk p :.V ouulsmolq =. p �j i ■� AV dUOIcOOO1'y o ■7 r0 U 1« DOW-) _ fG � C� ■ � nV uuuhung AV � I m n C `� �` ❑ c Y u v T o E Pa o-e.varleJ � a �lSrurllaweg IS�uglawU0 IL it ii,�zn St _ a a c � m N v a '- ' w Ic u n m �- aPlaAUTA • `ly ��_ Caramonga lho a 1S Jadwr usremd CIA L*140,; s1!! 011 to M n -15Pfe5 e a - r K 4l�keu::raSCIA lip 1 a` y yauucwii a C_ AV lcpl�' m � P r Y ; ' r nyasionhml o ny aswnbml_ R a:',rr bad:Kd P9O7 .r E r`,, a , cl 61 � yeUOISLjol)JAJ p - pp aD J o vao r n m}7991410 " rn _ ny auulsun5 " ° t4 RIG+ a.-� �.yauulwnsE N cc Pa �1S�uc paweg IS�ucpawe� � � � � m A a s a a w m a J � C - Gameho^y1 Z �' v L 4 m pop rir e 1 IL 4 .v 4y OSICIed CIA ! ® ` ($.E3 E�EYINE11 a.. Y r o f6. ihr =i d J'E �re P s r 5a euai S CIA x 1 CL ♦� sr§t 1 0 IS,ajiyddcS 000 r,V @uurwvnrV LL IS nmau ``� FIN fig AV IOPP-Pd IL IF a E a� i® III■ 'i x `.E r All 3 ■ •,•��ffie/ oil* 14P xg oa 1; not _ ny a5wnbinI !r asion[+inl ,f G 1 P908 * Please see revised Resolution RESOLUTION NO. 13-112 A RESOLUTION OF THE COUNCIL OF THE CITY OF RANCHO CUCAMONGA ESTABLISHING A PERMIT PARKING DISTRICT IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER 10.50 OF THE RANCHO CUCAMONGA MUNICIPAL CODE A. Recitals (i) Chapter 10.50 of the Rancho Cucamonga Municipal Code permits the establishment of a Permit Parking District in an area in which commuter vehicles (vehicles operated by persons whose destinations are to nonresidential areas or uses) substantially and regularly interfere th the use of the majority of availa• e parking spaces for the use of residents. (ii) Attached h eto as Exhibit A is an area, commonly referred t• as "Almond Street" and hereinafter referred to as "the Parking District" in which commuter vehicles • cupied by persons who are in route to the Cucamong= Creek are for various recreational purpo -s substantially and regularly interfere with the use and axial bility of parking spaces in the Parking P strict. (iii) Substantial evidence h. been presented to this C• ncil demonstrating that the persons referred to in Recital (ii) above, not o occupy a majority of e parking spaces in the Parking District, but also block access to the Parking ► strict's residence and driveways, generate significant noise, engage in hostile confrontations with thos- esidents, de•osit trash and litter within the Parking District, and that these activities occur regularly in we- .ly and •:ily intervals. (iv) It is the purpose of this Resolution to > tablish the Parking District as an area within which parking shall be limited at all times to parki.• by -sidents of that District, their guests, and those persons exempt from that limitation pursuan o Rancho ucamonga Municipal Code Section 10.50.100. (v) Pursuant to Rancho Cuca ga Municipal Code ections 10.50.020 and 10.50.040, the City Council may establish a Permit Par • g District in the absence •f a petition from the residents within the Parking District. (vi) Pursuant to Ran o Cucamonga Municipal Code Section 4.50.040, the City Engineer shall submit before the City C. ncil his Recommendation and Report which I attached hereto and made a part hereof. (vii) All leg- prerequisites to the adoption of this Resolution have been sat ied. B. Resolu on NOW, THEREFORE, it hereby is found, determined, and resolved by the Council of the City of Rancho Cucamonga as follows: 1. This Council hereby finds that all of the facts stated in Part A of this Resolution are true and correct. 2. Based on substantial evidence presented to this Council, the Council further finds and determines as follows: RESOLUTION NO. 13-112 — Page 1 P909 * Please see revised Resolution A. Commuter vehicles as defined in subsection 10.50.020A of the Rancho Cucamonga Municipal Code substantially and regularly interfere with the use of the majority of parking spaces for use of residents within the Parking District; B. The interference by commuter vehicles referred to in Paragraph 2A above occurs at regular and significant daily and weekly intervals; C. The commuter vehicles referred to in Paragraph 2A above cause and are the source of unreasonable noise, traffic hazards, and environmental pollution within the Parking District; D. The Council exercises its authority pursuant to Rancho Cucamon•: Municipal Code • -ctions 10.50.020 and 10.50.040 to establish a Parking Permit B. trict in the absence of - •etition; E. No unr- -sonable displacement of commuter vehicles ill result into surrounding residential :reas; and F. No alternative se ution, other than the establishme• of the Parking District is feasible or practical. 3. Based on the findings set orth in Paragrap. 2 above, the Parking District is hereby established as a Permit Parking District e rsuant to t provisions of Chapter 10.50 of the Rancho Cucamonga Municipal Code and parking 'erein i restricted to those residents and their guests possessing permits issued by the City Enginee or is delegate and those exempt pursuant to Rancho Cucamonga Municipal Code Section 10.50.100. 4. The City Engineer's Recommen•-tion and -eport has been submitted and the City Council accepts and approves said Recommend- on and Report i'clusive of Cost of Parking Permits. 5. The City Engineer is her- •y instructed to immedia : cause appropriate signs to be placed and posted within the Parking Di ict indicating the parking limita '•ns established by this Resolution and to implement and administer e permit process specified in R- cho Cucamonga Municipal Code Sections 10.50.070 and 10. .080. 6. The City Cl- shall certify to the adoption of this Resolution. RESOLUTION NO. 13-112 — Page 2 P910 * Please see revised Resolution ce 1 V S a l7 AV ouoisuOO�`� Lt = v a AV aUOISUOOW tJ aitse7 D: - a A auolsun E Ay auotsunS o y. S o u_ a Y ra Z.-- L O a o ' pj Acmate`'i z w C �-----tstuelleUae3 a .V ID W carnell at'St 1- i - - L a O - D aa) o a) a) m a c .-.\ w o � E � o a a ' L a s� ‘ CL CL V in IS 1:>dSrr /�A cc . IT! 0 t5 X18$ 0) Ts p L re C V r Y C O L/ n F. a L Q _I eua.1ag CIA li nw - 3 1s4a�lyddes E . tot X Ayauurw •Cy 1.i. W 1. i5 ti A\ 4i-., la SAW AV loP!id ''` 0 Q C N a 2 0 L a AV JO' I '1 c I Ic dl / I t - AV ellaa r § R. U O o `\ 4 CC u Ls ifI N p 6 c Z c i3 a to Ay a slonbm t a_ .ty asionbinl 1 a =_ in i k gAnch Gate.Rd July 3, 2013 City Council Meeting—ITEM N3. *REVISED* RESOLUTION NO. 13-112- See p 908 RESOLUTION NO. 13-112 A RESOLUTION OF THE COUNCIL OF THE CITY OF RANCHO CUCAMONGA ESTABLISHING A PERMIT PARKING DISTRICT IN ACCORDANCE WITH THE PROVISIONS OF CHAPTER 10.50 OF THE RANCHO CUCAMONGA MUNICIPAL CODE A. Recitals (I) Chapter 10.50 of the Rancho Cucamonga Municipal Code permits the establishment of a Permit Parking District in an area in which commuter vehicles (vehicles operated by persons whose destinations are to nonresidential areas or uses) substantially and regularly interfere with the use of the majority of available parking spaces for the use of residents. (ii) Attached hereto as Exhibit A is an area, commonly referred to as "Almond Street" and "Via Serena" and hereinafter referred to as "the Parking District" in which commuter vehicles occupied by persons who are in route to the Cucamonga Creek are for various recreational purposes substantially and regularly interfere with the use and availability of parking spaces in the Parking District. (iii) Substantial evidence has been presented to this Council demonstrating that the persons referred to in Recital (ii) above, not only occupy a majority of the parking spaces in the Parking District, but also block access to the Parking District's residences and driveways, generate significant noise, engage in hostile confrontations with those residents, deposit trash and litter within the Parking District, and that these activities occur regularly in weekly and daily intervals. (iv) It is the purpose of this Resolution to establish the Parking District as an area within which parking shall be limited at all times to parking by residents of that District, their guests, and those persons exempt from that limitation pursuant to Rancho Cucamonga Municipal Code Section 10.50.100. (v) Pursuant to Rancho Cucamonga Municipal Code Sections 10.50.020 and 10.50.040, the City Council may establish a Permit Parking District in the absence of a petition from the residents within the Parking District. (vi) Pursuant to Rancho Cucamonga Municipal Code Section 10.50.040, the City Engineer shall submit before the City Council his Recommendation and Report which is attached hereto and made a part hereof. (vii) All legal prerequisites to the adoption of this Resolution have been satisfied. B. Resolution NOW, THEREFORE, it hereby is found, determined, and resolved by the Council of the City of Rancho Cucamonga as follows: 1. This Council hereby finds that all of the facts stated in Part A of this Resolution are true and correct. 2. Based on substantial evidence presented to this Council, the Council further finds and determines as follows: RESOLUTION NO. 13-112 — Page 1 July 3,2013 City Council Meeting—ITEM N3. 'REVISED' RESOLUTION NO. 13-112-See p 908 A. Commuter vehicles as defined in subsection 10.50.020A of the Rancho Cucamonga Municipal Code substantially and regularly interfere with the use of the majority of parking spaces for use of residents within the Parking District; B. The interference by commuter vehicles referred to in Paragraph 2A above occurs at regular and significant daily and weekly intervals; C. The commuter vehicles referred to in Paragraph 2A above cause and are the source of unreasonable noise, traffic hazards, and environmental pollution within the Parking District; D. The Council exercises its authority pursuant to Rancho Cucamonga Municipal Code Sections 10.50.020 and 10.50.040 to establish a Parking Permit District in the absence of a petition; E. No unreasonable displacement of commuter vehicles will result into surrounding residential areas; and F. No alternative solution, other than the establishment of the Parking District is feasible or practical. 3. Based on the findings set forth in Paragraph 2 above, the Parking District is hereby established as a Permit Parking District pursuant to the provisions of Chapter 10.50 of the Rancho Cucamonga Municipal Code and parking therein is restricted to those residents and their guests possessing permits issued by the City Engineer or his delegate and those exempt pursuant to Rancho Cucamonga Municipal Code Section 10.50.100. 4. The City Engineer's Recommendation and Report has been submitted and the City Council accepts and approves said Recommendation and Report inclusive of Cost of Parking Permits. 5. The City Engineer is hereby instructed to immediately cause appropriate signs to be placed and posted within the Parking District indicating the parking limitations established by this Resolution and to implement and administer the permit process specified in Rancho Cucamonga Municipal Code Sections 10.50.070 and 10.50.080. 6. The City Clerk shall certify to the adoption of this Resolution. RESOLUTION NO. 13-112 — Page 2 July 3, 2013 City Council Meeting-ITEM N3. *REVISED* RESOLUTION NO. 13-112 - See p 908 L I * 8. '�� ��`e.8 t i to I• - !41 41 q i 4 !� -ntl_auoiwogyy ,a $ la %:10 litaD c c i e cc a. ift.G � �� .. nV aua,sung_E i II i x ° L'-(�� paAematc"-- c J - % rip '' C Cl) V ++ t6 . 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Or.- \ ' ! ilin a i' .� Mayor L. DI-NNIS MICHAEL • MayorPro"1 em SAM SPAGNOLO ConncilMemberr WILLIAM J.Ai.EXANDER,MARC STEINORTI-I, DIANE WILLIPg11 � City Manager JOHN R.GILLISON { f THE CITY OF RANCHO CUCAMONGA RANCHO CUCAMONGA ENGINEER'S RECOMMENDATION AND REPORT July 3, 2013 PARKING PERMIT PROGRAM A Permit Parking Program allows residents of a qualified neighborhood special permits that exempt them and their guests from certain on-street parking restrictions. ELIGIBILITY REQUIREMENTS • A Permit Parking District may be established by resolution of the City Council. • Residents requesting the creation of a Permit Parking District must submit a petition signed by at least seventy-five percent (75%) of the residents or property owners within the boundaries of the proposed district. (One vote per address.) • The City Council may establish a Permit Parking District in the absence of a petition. • The boundaries of a proposed Permit Parking District shall be reviewed and approved by the City Engineer. • An application for a parking permit may be made by any resident living within boundary of an approved district. • The applicant must show proof of residence less than 30 days old, and proof of ownership for each vehicle that a parking permit is requested for. RESTRICTIONS A parking permit does not exempt a vehicle from Section 10.44.130, "Storage of Vehicles upon Streets", of the City of Rancho Cucamonga Municipal Code. According to Section 10.44.130, a vehicle may not park in the same parking space on a public street for more than seventy-two (72) consecutive hours. A parking permit does not exempt a vehicle from City Municipal Code Section 10.64.030 "Parking Restriction", of the City of Rancho Cucamonga Municipal Code. According to Section 10.34.030, it is unlawful for any person to park or store any house car, trailer, camp trailer, trailer coach, camper, or boat upon any public street or highway or alley within the City for longer than one hour between the hours of 2:00 AM and 6:00 AM on any day. TYPES OF PERMITS AND DISPLAY There are two types of parking permits available. There are permanent stickers for owned vehicles and transferable guest parking permits. The "permanent sticker" parking permit for an owned vehicle shall be permanently affixed to the lower driver side of the inside of the rear window of the assigned vehicle. The transferable guest parking permit shall be hung from the inside rear view mirror. P912 NUMBER OF PERMITS ALLOWED • A maximum of three (3) "permanent sticker" parking permits may be issued to residents of a single dwelling unit. • A resident may request more than three (3) "permanent sticker" parking permits for special circumstances. Special circumstances will be reviewed by the City Engineer. • A resident will be allowed a maximum of five (5) guest parking permits at any time. EXPIRATION • Permanent parking permits for"owned vehicles" are valid for a period of up to three (3) years. • Permanent parking permits for owned vehicles will expire on July 31, 2016, and every three (3) years thereafter. • Guest parking permits are valid for a period of one (1) year. Guest parking permits will expire annually on July 31st. COST OF PARKING PERMITS • Parking permit for owned vehicles $10 for the first vehicle plus $2 for each additional vehicle (3 max) when registered all at the same time. • Guest parking permit (5 max) $10 each • Replacement of lost or stolen permits $10 each • Exchange of an old guest permit for a new permit Free • Parking Permit for a new vehicle $10 • Temporary Guest Parking Permit (valid for one day) Free The cost of parking permits is based on the cost of materials and staff time to manage the program and for keeping records. Costs are subject to change. GUEST PARKING PERMITS • Each guest parking permit shall be numbered sequentially. The number of the guest parking permit issued to a resident shall be recorded and kept on file. • Guest parking permits are valid for a period of one (1) year. Guest parking permits will expire annually on July 31 st. • Expired guest parking permits may be exchanged for current guest parking permits at no cost. • Only a resident of the permit parking district may apply for, return or exchange guest parking permits. P913 TEMPORARY GUEST PARKING PERMIT • A resident may apply for an unlimited number of Temporary Guest Parking Permits. Temporary Guest Parking Permits are valid for one day. • Only a resident of the permit parking district may apply for Temporary Guest Parking Permits. SPECIAL EVENTS If a resident desires more than five (5) guest parking permits for a special event, the resident may apply for a special event permit that will temporarily suspend the need for visitors to display a parking permit. Staff may require that the resident fulfill special conditions, such as notifying neighbors of the special event, and bagging the permit parking district regulation signs. TO OBTAIN A PARKING PERMIT You may obtain a parking permit in person Monday through Thursday, 7:00 AM to 6:00 PM at City Hall, located at 10500 Civic Center Drive, Rancho Cucamonga, CA 91730 or by mailing a copy of your information to: City of Rancho Cucamonga Attention: Parking Permit Coordinator P. O. Box 807 Rancho Cucamonga, CA 91730 Residents must provide proof of residency less than 30 days old in one of the following forms: • Current utility bill, blank statement, credit card bill, or other bill statement that was sent through the mail on a monthly billing cycle • Rental/lease agreement signed within the last 30 days • Proof of property ownership, tax bill or new escrow papers Residents must also provide a copy of the following: • Valid Driver's license. • Copy of the vehicle registration (Note: the resident must be the registered owner). • Company cars not registered to you require a letter from the registered owner authorizing you to use the vehicle and referencing the vehicle's license plate number. • Vehicles registered to family members other than the home owner need a letter from the homeowner identifying them as a family member. FINE FOR PARKING VIOLATIONS • Fine per violation $50 (Fines are subject to change) P914 PETITION JUN 2,6:2013 P CITE OF RANCHO CUCAMONGA ENGINEERING DPASION To: Rancho.Cucamonga City Council Puryose:To rele tf �/parea Ing coon on north Sapphire St.from whiriuway St.to Almond St and eliminate trash accumuhftn and furthermore,to rellmre traffic/parking congestion on Almond St from Henry St.east to Sapphire SL and eliminate trash accumulation in that area. *hat do we want to achieve:Remove parking resWcUons on Almond St west of Henry St.and remove parking resWk:dons on Skyline Rd.'open up aooess for foot traffk to the floor of Cucamorga Canyon from west Almond St Install"NO PARIUN?"signs on north Sapphire St and on Almond St east Of Henry St Name: ame. s arms: ress: ress_ Address: mo ame: ame: q�EN ZKuSK� Warrm Address: Address: Name: / d e: ame: �. ll `533 9 Address: Mime: -¢. W f r1 .� - . �� - ame:- Add:;!- 3ql ,Px fl v .f�- - r e � g 3as' '�3-Q,VI�i V�s�� address: .. } f rVn Z, Ca. 11701 ame: _ me. dress: y�f /VVY ressc I�., U : .�- ii Name-. � me:: [ Address: ��� ame: e: Add f`� ' ,�` � t Tess:$3 d b lie t i q V,`sg Address: Iftme: iuTrfia-D .j f v2lrEZ Name. me r jAddress: ress. Address: C4 11tH I P915 RANCHO CUCAMONGA ANIMAL CARE AND ADOPTION CENTER BACKGROUND In December 2012, the Grand Jury received a complaint alleging cruelty to animals at the Rancho Cucamonga Animal Care and Adoption Center (RCAC). Some of the allegations did not fall within the purview of the Grand Jury. The original complaint allegations concerning the operation of RCAC were as listed below: I. Dogs confined to crates for long periods of time without exercise. 2. Staff discharging firearms on the RCAC grounds in violation of City Code Ordinance 9.04.010. 3. Funds raised at charity events were not used exclusively for the benefit of animals by RCAC. 4. Claims of a higher rate of adoption than was actually experienced. 5. Off-site animal adoptions, dog training classes and other programs have been reduced or discontinued. FACTS In 1998, the California Legislature enacted Senate Bill 1785 (SB 1785), also known as the Hayden Law, in an effort to reduce the rate of euthanasia of animals in California's animal shelters and to facilitate adoption and owner redemption of animals as alternatives to euthanasia, while improving the overall living conditions of animals entrusted to the care of those shelters. S13 1785 indicates the Legislature's intent by establishing standards of care for animals in California's animal shelters, • Imposing mandatory holding periods for stray animals to allow owners to find lost animals or for adoption, • Requiring that all animals be scanned for microchip identification upon impound, • Actively promoting adoption either to individuals directly or through rescue groups, rather than euthanasia. Provisions of the Hayden Law are codified in the California Food and Agricultural Code, Civil Code and Penal Code. The RCAC was constructed in 1993 and at the time was managed by San Bernardino County. In 2005, the Rancho Cucamonga City Council authorized the city taking over the animal program from the County. In 2006, city staff was hired and renovation was completed. RCAC officially opened May, 2006. P916 Grand Jury Investigation The Grand Jury made three separate visits to the RCAC. The first visitation was on February 13, 2013, during an Open House. The purpose of the Open House was to stimulate interest in adopting a pet and for the community to observe the day-to-day operation. The second visit by the Grand Jury was with the Director of RCAC before it was open to the general public on March 8, 2013. A tour of the facility led by the Director was given including the cleaning of cages, feeding, exercise yard and adoptions areas. The Director answered all questions regarding the operation of the center. These questions included financial reports, rehabilitation and training of all types of dogs not concentrating on one breed, fund raising events for the benefit of all the animals, foster care of newly born kittens and pups, euthanasia and future plans for RCAC. The third visit was unannounced and took place April 2, 2013. During this visit the Grand Jury toured the facility led by an officer. The Grand Jury observed cleanliness of the facility, the personal care given all animals, outreach programs, accounting of funds, rehabilitation/training of all breeds of dogs, which are well within compliance with the Hayden Law. It was noted that cats were released from their cages and placed in "free roaming rooms." The rooms were also used to showcase cats for adoption. There were accommodation rooms for cats with surgeries or disabilities. There is a fenced-in area in the main lobby where rabbits could exercise. All cats, rabbits and other animals had beds or blankets for comfort. On all three visits the Grand Jury saw animals in stainless steel crates and dogs in outside and inside concrete-floored kennels. Each cage or kennel had either a built-in hammock-type bed, or blankets and towels provided for comfort. Each cage or kennel had food and water, floors were washed and blankets or towels were frequently changed. Each cage or kennel had sufficient height or floor space for the animals to stand up, sit down, and turn-about freely using normal body movements without the head touching the tops of enclosure and able to lie down with limbs outstretched. Other provisions for the comfort of animals include: • An outside yard is used for exercise. Staff members supervise the exercise of dogs in a covered, sand filled yard at least three days a week, with help from citizen volunteers. • Like-sized dogs are grouped together for exercise and play. • During the noon hour people from the community, including employees, come to the center to walk dogs. • The dog play area when not in use for exercise is devoted to training and rehabilitation, and a meet-and-greet with potential adopters. P917 • The Center has a program called "No Dog Left Behind" where dogs who do not play well with others are given a chance to exercise alone. No animals were observed being mistreated. At no time during the three visits, announced or unannounced, was adverse action toward animals, caged or free-roaming, observed. The cages were clean and size-appropriate and blankets or towels were provided for comfort and warmth. The center has industrial washers and dryers in use 12 hours per day for blankets and towels. The washing, drying and folding of the blankets are maintained by a group of special needs volunteers. No animal appeared sick or underfed. There were volunteers or a staff member in all areas inspected by the Grand Jury. A veterinarian and veterinarian technicians are on staff and were present for evaluation of in- coming animals. 2. The Grand Jury investigated the allegation of a weapon discharge on RCAC property. The only gun on the premises is a tranquilizer dart gun used for emergencies and is secured in a locked safe. The gun was used once at the center to control an aggressive animal during in-take • two years ago. All staff are trained in usage of the dart gun at the City Yard as part of ongoing training and condition of employment. Due to the lack of evidence, the Grand Jury was unable to substantiate this allegation. 3. The Grand Jury investigated the concerns that monies were going to benefit Victoria Gardens Cultural Center versus the RCAC. Monies from outside events and personal donations are deposited in a 501(c)(3) umbrella organization with five other charities supervised by the Rancho Cucamonga Cultural Arts Foundation (RCCAF). Only RCAC personnel can withdraw from this account which is ear-marked for the RCAC. Monies collected from donations or funds raised for RCAC must be used for the benefit of the animals. The RCAC holds monthly and yearly fund-raising events which netted approximately $58,000 in 2012 and is added to the monies from the general fund and deposited in the RCCAF 501(c) (3) account. At the end of the fiscal year, after expenses are paid, the remaining balance is rolled-over for the next year. The Grand Jury received and reviewed a copy of the City of Rancho Cucamonga's fiscal year 2012-2013 Annual Budget Summary for Animal Care and Services. It should be noted that each year the RCAC receives a budget line item of approximately $2,000,000 from the City General Fund to operate the center. This money is allocated for full time employee's salaries, overtime, benefits, operation and maintenance. The center has 29 employees. It has been documented that volunteers donated approximately 10,000 hours in 2012. The center's management recognizes the volunteers as a valuable resource in the day-to-day operations of RCAC. • P918 4. The Grand Jury received published documentation of statistics presented to the City referencing the RCAC field officer calls, licenses sold, intake of live animals, adoption, and euthanized animals. Included in the statistics are birds, hamsters, rabbits and wildlife returned back into the wild after being rehabilitated. Total animal intake for 2012 were 5,390 of which 785 were euthanized for various reasons, i.e. sick, injured or overly aggressive animals who could not be trained or rehabilitated. Adoption rate was 84%. 5. The Grand Jury found no evidence during the visits that programs such as "play day" for dogs were reduced or discontinued. RCAC is continuing off-site adoption promotions and implementing more community outreach programs. RCAC is targeting low-cost spay and neuter days and no-cost microchip clinics. These costs are funded from the $58,000 raised from donations and charity events sponsored by RCAC. FINDINGS I. Dogs are not confined to cages for long periods of time. 2. There is no evidence of a weapon discharged on the RCAC grounds. 3. Funds raised and donations to RCAC are directed exclusively to the RCAC account. 4. Adoption rates are accurately reported by RCAC. 5. Programs promoting the RCAC have not been discontinued or deleted. 6. Management, staff and volunteers, exhibit professionalism and commitment in the operation of RCAC. 7. RCAC is transparent in its operation. 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