1. business and industrial
2. construction

STAFF REPORT
DATE:
March 17, 2015
TO:
City Council
FROM:
Mike Webb, Director of Community Development & Sustainability
SUBJECT:
Cannery Request for Community Facilities District (CFD) Formation
Recommendation
Staff recommends the City Council:
1. Adopt the attached Resolution of Intention to Establish Proposed Community Facilities
District No. 2015-1 (Cannery) of the City of Davis; and
2. Adopt the attached Resolution Declaring Necessity for Proposed Community Facilities
District No. 2015-1 (Cannery) of the City of Davis to Incur Bonded Indebtedness; and
3. Adopt the attached Resolution Declaring the City’s Intent to Issue Tax-Exempt Bonds to
be Used to Reimburse the City for Expenditures Prior to the Issuance of Tax-Exempt
Bonds.
City Council Goals
• Promote Community
• Fund, Maintain, and Improve Infrastructure
Fiscal Impact
The obligation to pay special taxes for CFD 2015-1 is a special limited obligation of the property
within CFD 2015-1. Individual property owners are obligated to pay the special taxes in the same
manner as ad valorem taxes. The special taxes do not constitute a personal obligation of the
landowner. The City has no obligation to pay the special taxes. The special taxes are secured
solely by a lien on the taxable parcels within CFD 2015-1. When bonds are issued by CFD 20151, debt service will be secured solely by a pledge of the special taxes on parcels within CFD
2015-1. There is no obligation of the City to pay debt service on the bonds from funds other than
the special taxes.
The City is responsible for administering the levy of the special taxes for CFD 2015-1. Special
taxes levied in CFD 2015-1 will be sufficient to pay for all administrative costs of the City
related to the CFD in addition to the amount needed to pay debt service on the bonds.
As the administrating agency of CFD 2015-1, the City must exercise remedies against defaulting
parties in CFD 2015-1, which includes the obligation to foreclose against parcels which are
delinquent in the payment of special taxes. The costs associated with the foreclosure are payable
from the special taxes. Extremely high rates of delinquencies, which are unlikely, in the CFD
could result in an extended foreclosure process. Any costs incurred in the foreclosure process
would be ultimately paid from special tax revenues and/or foreclosure sale proceeds.
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Background and Discussion
Background. The Cannery project consists of 547 residential units and 171,000 square feet of
non-residential development to be constructed on 100 acres located at the intersection of Covell
Blvd and H Street. Of the residential units, 463 of the 547 would be eligible for CFD special
taxes (the 60 affordable housing units and 24 mixed use rental units would not have CFD taxes).
Basic infrastructure for the project is under construction now. The total public infrastructure
costs for The Cannery project are approximately $21 million. The developer, The New Home
Company, has submitted a formal proposal to fund a portion of these costs through bonds issued
by a community facilities district (CFD) formed under California's Mello-Roos law, and directly
by special taxes levied on homeowners within the CFD.
On November 5, 2014 the City Council held a workshop on the more general topic of CFD’s in
anticipation of the specific Cannery CFD formation request. The November 5th report and
presentations can be found at: http://city-council.cityofdavis.org/council-meetings/agenda--november-5-2014---special-meeting
The City Council was presented with the specific Cannery CFD proposal for consideration and
direction on February 17th. This report can be found at: http://citycouncil.cityofdavis.org/Media/Default/Documents/PDF/CityCouncil/CouncilMeetings/Agendas/
20150217/08-Cannery-Community-Facilities-District-Formation.pdf
At the February 17th meeting, the City Council directed, o a 3-2 vote, staff to move forward with
the next steps of CFD formation.
Discussion. CFD 2015-1 will authorize the levy of a special tax on all residential units, except
affordable housing units, and all non-residential development, except for property owned by the
property owners association for The Cannery, up to a maximum of .89 acres. Additionally, 51.5
acres of publicly owned property within the proposed CFD will not be taxable. CFD 2015-1 will
authorize the levy of a special tax on taxable parcels for the purpose of paying debt service on
bonds, the proceeds of which will be used to fund public infrastructure for The Cannery.
Proposed Tax Structure for CFD 2015-1. CFD 2015-1 will authorize a levy of a maximum
annual tax on taxable residential units ranging from $904 per unit to $3,223 per unit depending
on the size of the actual home (not the lot). The maximum annual tax for non-residential
development will be $0.26 per square foot. This maximum tax on all taxable property will
escalate at 2% per year, each year.
Maximum Term of Special Taxes. The original proposal by The Cannery was for a term of 40
years. Based on City Council direction from February 17th, the proposed term has been reduced
to 30 years. The resolution of intent provides that special taxes shall not be levied on residential
parcels to pay capital costs of the facilities or principal and interest on any bonds on the later of
either the 30th anniversary of the date on which bonds were issued for CFD 2015-1 or fiscal year
2045-46.
Overall Tax Obligation on The Cannery Homeowners. Based on the analysis prepared for and
presented to the Council at its February 17th meeting, the combined ad valorem, assessment and
CFD tax burden for homes in The Cannery, including the DJUSD CFD's represent an overall
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effective tax rate of 1.75% of estimated market value for homes in The Cannery.
Use of Bond Proceeds and Reimbursements to The New Home Company. The total cost for
public infrastructure to fully develop The Cannery has been estimated by The New Home
Company at approximately $21 million. Under current market conditions, the City's finance team
estimates that $11.8 to $13 million of this total could be financed by one or more series of bonds
secured by CFD 2015-1 special taxes. This bonding capacity assumes that the special tax levy on
taxable parcels for CFD 2015-1 increases at 2% per year for the full 30-year term of the bonds
expected to be issued by CFD 2015-1.
Of the $11.8 to $13 million total, shown below is the list of eligible facilities for the use
of bond proceeds to fund infrastructure required for The Cannery:
Infrastructure Phase 1
Cannery Avenue
Cannery Loop
Market Avenue
Roundabout
Emergency Vehicle Access Road
Detention Basin
Storm Drain Pump Station
Agricultural Well
Landscaping
Parks
Greenbelts
Offsite Infrastructure
J Street Intersection Improvements
L Street Traffic Signal
Covell Boulevard Frontage Improvements
Offsite Bike/Pedestrian Trail
Oak Tree Plaza Improvements
Infrastructure Phase 2
Cannery Loop Road
The Development Agreement specifically requires parks and greenbelts to be installed
concurrent with home construction on adjacent residential parcels. If the project approvals were
strictly adhered to, the parks and greenbelts could be developed in a more piecemeal fashion,
with the southern park that features the amphitheater, bocce courts, and play area coming on
towards the end of the project. The central park that includes the practice field could also be
delayed until the first small builder homes were built across the street from where the park is to
be constructed.
Instead of phasing park and greenbelt amenities, New Home plans to continuously construct the
comprehensive park improvements and greenbelt system to ensure these amenities are enjoyed
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by the larger community and Cannery residents. With the assumption of CFD proceeds, New
Home plans to substantially complete all greenbelts and the entire park spine from the private
Clubhouse at the north to the mixed use area at the south, by summer 2015.
Bond proceeds in the amount of the estimated installation costs associated with the Parks and
Greenbelts proposed for acceleration will be set aside in the City controlled CFD bond proceeds
account to ensure that other listed priority improvements do not draw down the account to a level
below the estimated cost of these improvements prior to said improvements being installed. As
the accelerated Park and Greenbelt related amenities are being completed, The New Home
Company will be allowed to request payment for and be reimbursed for associated Parks and
Greenbelt amenities and draw against this set aside. This set aside provides the City assurance of
the acceleration being met by way of funding prioritization. Prioritization of facilities is
discussed further below under “Next Steps in CFD Formation” of this report.
In addition, as previously discussed with Council, the $750,000 in bond proceeds for the
community benefit improvement to be determined by the Council will be set aside in bond
proceeds. The New Home Company has agreed that this amount will be increased if net proceeds
of the CFD bond issue exceed $11.8 million, at a rate of 50% of all such excess proceeds being
allocated to the community benefit improvement (see attached letter). If bond sales resulted in
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total proceeds of $12.8 million, for example, the contribution to the City for a community benefit
improvement would be $1,250,000.
After consultation with our consultant team, legal counsel and the applicant, it was determined
that the costs of all improvements for The Cannery Farm will be funded directly by the New
Home Company without reimbursement from CFD bond proceeds.
Consistency with City Goals and Policies for Mello Roos. In 2007 the City adopted goals and
policies for CFD's formed by the City. These goals and policies cover issues regarding the tax
structure of a CFD, the facilities to be funded, and credit issues regarding the issuance of bonds.
The resolutions being considered by the Council at this time control only the tax structure of the
CFD and the facilities to be funded. With respect to the tax structure, the key policy provision is
that the combined ad valorem taxes, assessments and CFD special taxes be "reasonable". At
1.75% equivalency to an ad valorem tax, the City's finance team believes that the proposed
special tax structure for CFD 2015-1 is reasonable. The City's finance team also believes that
inclusion of a 2% escalator on special taxes is also reasonable, as required by the Goals and
Policies. With respect to the facilities to be funded, CFD 2015-1 is consistent with the applicable
provisions of the City's Goals and Policies in that backbone infrastructure and improvements of
community benefit as the Goals and Policies refers to "compensation" to the City in
consideration of the benefit provided through tax exempt financing through the CFD.
Documents. The resolutions for Council adoption would approve the following documents:
1) Resolution of the City Council of the City of Davis Declaring Its Intention to Establish
Proposed Community Facilities District No. 2015-1 (Cannery) of the City of Davis. This
resolution also specifically approves a Rate and Method of Apportionment of Special Tax
for CFD 2015-1, which specifies the actual tax structure for the proposed CFD. This
resolution also directs that a boundary map be filed for the proposed CFD. The
resolution also calls a hearing for May 5, 2015.
2) Resolution of the City Council of the City of Davis Declaring Necessity for Proposed
Community Facilities District No. 2015-1 (Cannery) of the City of Davis to Incur Bonded
Indebtedness. This resolution would allow the CFD to issue bonds in an amount not to
exceed $17 million. The difference between the $13 million figure estimated as the
maximum likely to be available to pay construction and the $17 million cap is due to the
provision for a debt service reserve fund and capitalized interest for the potential bond
issue. This resolution also calls a hearing for May 5, 2015.
3) A Resolution of the City Council of the City of Davis Declaring Its Intent to Issue TaxExempt Bonds to be used to reimburse eligible City expenditures incurred prior to the
Issuance of Tax-Exempt Bonds. This resolution is required under Federal tax law to
enable the proceeds of a tax-exempt bond issue to be used to reimburse any City
expenditures for infrastructure construction costs incurred prior to the issuance of any
bonds. The resolution is adopted as a purely precautionary measure to protect any City
expenditure of funds for capital improvements. While no such expenditures are
anticipated, this provides an extra level of protection to ensure reimbursement, should
any expenditures be incurred. For example, if the City were to use any of its funds to
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construct or acquire any improvement, then bonds proceeds could be available to
reimburse the City. The resolution does not obligate the City to issue bonds or to spend
City funds.
Next Steps in CFD Formation
A hearing for adoption of a Resolution of Formation will be conducted on May 5, 2015. After
the hearing, the Council will be presented with resolutions, which form CFD 2015-1 and then
call a landowner vote, as there are no registered voters within CFD 2015-1. The election will be
regarding the question of the levy of the special tax, the issuance of the bonds and the
establishment of an appropriations limit for CFD 2015-1. If the landowners approve the levy of
the special tax and the issuance of the bonds, then the Council will be asked to consider the first
reading of an ordinance levying the special tax. It is also expected that the Council will be
presented on May 5th with a funding and acquisition agreement between the City and the
developer. The purpose of the agreement is to provide for the terms of the construction and
manner of payment for the public facilities expected to be financed with the proceeds of the
bonds of CFD 2015-1. Additionally, the agreement will specify the prioritization of the use of
bond proceeds to pay for infrastructure and community benefit improvements.
The City's finance team anticipates that bonds will be issued in September, 2015. The City
Council will be presented with the proposed bond documents at a meeting later this summer.
Attachments
1. Updated Community Enhancement letter from New Home
2. Resolution of Intention to Establish Proposed Community Facilities District No. 2015-1
(Cannery) of the City of Davis.
3. Resolution Declaring Necessity for Proposed Community Facilities District No. 2015-1
(Cannery) of the City of Davis to Incur Bonded Indebtedness.
4. Resolution Declaring Intent to Issue Tax-Exempt Bonds to be used to Reimburse the City
for Expenditures Prior to the Issuance of Tax-Exempt Bonds
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RESOLUTION NO. 15-____, SERIES 2015
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DAVIS DECLARING ITS
INTENTION TO ESTABLISH PROPOSED COMMUNITY FACILITIES DISTRICT
NO. 2015-1 (CANNERY) OF THE CITY OF DAVIS
WHEREAS, the City Council (the “City Council”) of the City of Davis (the “City”) has received
petitions from the owners of certain real property within the City (the “Owners”) requesting that
the City Council institute proceedings for the formation of a community facilities district,
pursuant to Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of
the California Government Code, commonly known as the “Mello-Roos Community Facilities
Act of 1982,” for the purpose of constructing, acquiring and financing through the sale of bonds
or the levy of special taxes the construction and acquisition of public facilities which are
necessary to meet increased demands placed upon the City as a result of the development of said
real property (the “Facilities”); and
WHEREAS, the Owners are the owners of all of the property which is proposed to be included
within the proposed community facilities district; and
WHEREAS, the City Council has established its Local Goals and Policies concerning the use of
Mello-Roos Community Facilities Districts in May, 2007 (the “Policies’), and the proposed
Facilities comply with the Policies; and
WHEREAS, pursuant to Section 53320 of the California Government Code, having received
such petitions, it is appropriate for the City Council to institute proceedings for the formation of
the proposed community facilities district by the adoption of a resolution of intention pursuant to
Section 53321 of said Code;
NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Davis does hereby
approve as follows:
SECTION 1. Proposed Community Facilities District; Compliance with Policies. A community
facilities district is proposed to be established under the provisions of Chapter 2.5 (commencing
with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code,
commonly known as the “Mello-Roos Community Facilities Act of 1982.” The name proposed
for the community facilities district is “Community Facilities District No. 2015-1 (Cannery) of
the City of Davis, County of Yolo, State of California,” herein referred to as CFD No. 2015-1.
This City Council finds that the proposed Facilities comply with the Policies.
SECTION 2. Description and Map of Boundaries. The boundaries of the proposed community
facilities district are described and shown on the map entitled “Boundaries of City of Davis
Community Facilities District No. 2015-1 (Cannery), County of Yolo, State of California,”
which is on file with the City Clerk. Said map is approved and, pursuant to Section 3110 of the
California Streets and Highways Code, the City Clerk shall, after conforming with the other
requirements of Section 3111 of said Code, record the original of said map in her office, and not
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later than 15 days prior to the date of the public hearing set forth in Section 9 hereof shall file a
copy of said map with the County Recorder of the County of Yolo.
SECTION 3. Types of Facilities and Incidental Expenses.
(a)
The types of public facilities proposed to be provided for and financed by the
proposed community facilities district are public roadways, storm drainage, sanitary
sewer, water, landscaping, greenbelts, parks and open space, civic facilities, and
community recreational facilities, as well as certain off-site improvements, (collectively,
the “Facilities”).
(b)
The incidental expenses which will be incurred are: (i) the cost of planning and
designing such facilities, construction review, and the cost of environmental evaluations
thereof, (ii) all costs associated with the formation of the proposed community facilities
district, issuance of the bonds thereof, the determination of the amount of and collection
of taxes, and administrative and professional costs otherwise incurred in order to carry
out the authorized purposes of the community facilities district, and (iii) any other
expenses incidental to the construction, completion, acquisition and inspection of such
facilities.
SECTION 4. Special Taxes. Except where funds are otherwise available, special taxes
sufficient to pay for all such facilities, to pay for debt service on other obligations of the City
relating to such facilities, and to pay the principal of and interest on the CFD No. 2015-1 bonds
and the annual administrative expenses of the City and in determining, apportioning, levying and
collecting such special taxes, and in paying the principal of and interest on such bonds and the
costs of registering, exchanging and transferring such bonds, secured by the recordation of a
continuing lien against all taxable or nonexempt property in CFD No. 2015-1, shall be annually
levied within CFD No. 2015-1.
All Residential Parcels, defined below, of taxable property in the territory of CFD No. 2015-1
shall be subject to the annual levy of special taxes to pay for the Facilities and the principal of
and interest on the aggregate principal amount of the CFD No. 2015-1 bonds that may be issued
and sold to finance the design, construction and acquisition of the Facilities.
The special taxes to be levied on parcels of taxable property in the proposed community facilities
district to pay for the Facilities and the principal of and interest on the bonds of the proposed
community facilities district that may be issued and sold to finance the Facilities or to pay or
accumulate funds for paying the costs of the design, construction and acquisition of such
facilities, or to pay other debt obligations of the City relating to such facilities are set forth in
Exhibit “A” attached hereto.
The maximum amounts of special taxes that may be levied in any fiscal year on parcels within
the proposed community facilities district that are used for private residential purposes
(“Residential Parcels”) are specified in dollar amounts in Exhibit “A” attached hereto. Special
taxes shall not be levied on any Residential Parcels to pay the capital cost of the facilities or the
principal of and interest on the outstanding CFD No. 2015-1 bonds on the date that is the later of
(i) the Fiscal Year immediately following the thirtieth (30th) anniversary of the date on which
the CFD No. 2015-1 bonds were sold or (ii) Fiscal Year 2045-2046. Under no circumstances will
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the Special Tax levied in any Fiscal Year against any Assessor’s Parcel for which an occupancy
permit for private residential use has been issued be increased as a consequence of delinquency
or default by the owner or owners of any other Assessor’s Parcel(s) within CFD No. 2015-1 by
more than ten percent (10%) above the amount that would have been levied in that Fiscal Year
had there never been any such delinquencies or defaults.
The conditions under which the obligation to pay the special taxes may be prepaid and
permanently satisfied are as set forth in Exhibit “A” attached hereto.
Pursuant to Section 53340 of the California Government Code, said special taxes shall be
collected in the same manner as ordinary ad valorem property taxes are collected and shall be
subject to the same penalties and the same procedure, sale, and lien priority in case of
delinquency as is provided for ad valorem taxes.
Upon recordation of a notice of special tax lien pursuant to Section 3114.5 of the California
Streets and Highways Code, a continuing lien to secure each levy of the special taxes shall attach
to all non-exempt real property in the proposed community facilities district, and that lien shall
continue in force and effect until the special tax obligation is prepaid and permanently satisfied
and the lien canceled in accordance with law or until collection of the special taxes ceases.
SECTION 5. Exempt Properties. Pursuant to Section 53340 of the California Government
Code, and except as provided in Section 53317.3 of said Code, properties of entities of the state,
federal, and local governments shall be exempt from the levy of special taxes.
SECTION 6. Necessity. The City Council finds that the proposed Facilities described in
Section 3 hereof are necessary to meet increased demands placed upon the City as a result of
new development occurring within the boundaries of CFD No. 2015-1.
SECTION 7. Repayment of Funds Advanced or Work-in-Kind. Pursuant to Section 53314.9 of
the California Government Code, the City Council proposes to accept advances of funds or
work-in-kind from private persons or private entities and to provide, by resolution, for the use of
those funds or that work-in-kind for any authorized purpose, including but not limited to, paying
any costs incurred by the City in creating CFD No. 2015-1, and to enter into an agreement, by
resolution, with the person or entity advancing the funds or work-in-kind to repay funds
advanced, or to reimburse the person or entity for the value, or cost, whichever is less, of the
work-in-kind, as determined by the City Council.
SECTION 8. Prohibition of Owner Contracts. Pursuant to Section 53329.5 of the California
Government Code, the City Council finds that the public interest will not be served by allowing
the owners of property within CFD No. 2015-1 to enter into a contract in accordance with
subdivision (a) of that section, and that such owners shall not be permitted to elect to perform the
work and enter into a written contract with the City for the construction for the public facilities
pursuant to said Section 53329.5.
SECTION 9. Hearing. A public hearing on the formation of the proposed community facilities
district shall be held at a meeting commencing at 6:30 p.m. on May 5, 2015 in the Community
Chambers at City Hall located at 23 Russell Boulevard, Davis, California.
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SECTION 10. Notice. The City Clerk shall publish a notice of the time and place of said
hearing as required by Section 53322 of the California Government Code, and shall also give
notice of the time and place of said hearing by first-class mail to each registered voter and to
each landowner within CFD No. 2015-1 as prescribed by Section 53322.4 of said Code. Said
notice shall be published at least seven (7) days and mailed at least 15 days before the date of the
hearing, and shall contain the information required by said Section 53322.
SECTION 11. Report. The City Manager, or his designee(s), being the officer(s) of the City
who will be responsible for providing the proposed types of public facilities to be included in and
financed by CFD No. 2015-1, if it is established, shall study CFD No. 2015-1, and, at or before
the time of said hearing, file a report or reports with the City Council containing a brief
description of the public facilities by type which will in their opinion be required to adequately
meet the needs of CFD No. 2015-1 and their estimate of the fair and reasonable cost of providing
those public facilities and the incidental expenses to be incurred in connection therewith. All
such reports shall be made a part of the record of the hearing to be held pursuant to Section 9
hereof.
SECTION 12. Description of Voting Procedures. The voting procedures to be followed shall be
pursuant to Section 53326 of the California Government Code and pursuant to the applicable
provisions of the Election Code.
SECTION 13. Effective Date. This Resolution shall take effect from and after the date of its
passage and adoption.
PASSED AND ADOPTED by the City Council of the City of Davis this 17th day of March,
2015, by the following vote:
AYES:
NOES:
Daniel M. Wolk
Mayor
ATTEST:
Zoe S. Mirabile, CMC
City Clerk
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EXHIBIT “A”
RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
CITY OF DAVIS
COMMUNITY FACILITIES DISTRICT NO. 2015-1
(CANNERY)
A Special Tax as hereinafter defined shall be levied on all Assessor’s Parcels in the City of Davis
Community Facilities District No. 2015-1 (“CFD No. 2015-1”) and collected each Fiscal Year,
in an amount determined by the City Council of the City of Davis through the application of the
Rate and Method of Apportionment of Special Tax, as described below. All of the real property
in CFD No. 2015-1, unless exempted by law or by the provisions hereof, shall be taxed for the
purposes, to the extent and in the manner herein provided.
A.
DEFINITIONS
The terms hereinafter set forth have the following meanings:
“Acre or Acreage” means the land area of an Assessor’s Parcel as shown on an
Assessor’s Parcel Map, or if the land area is not shown on an Assessor’s Parcel Map, the
land area shown on the applicable Final Map, parcel map, condominium plan, or other
recorded County parcel map. An Acre equals 43,560 square feet of land area.
“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, being
Chapter 2.5, Division 2 of Title 5 of the Government Code of the State of California.
“Administrative Expenses” means the following actual or reasonably estimated costs
directly related to the administration of CFD No. 2015-1: the costs of computing the
Special Taxes and preparing the annual Special Tax collection schedules (whether by the
City or designee thereof or both); the costs of collecting the Special Taxes (whether by
the County or otherwise); the costs of remitting the Special Taxes to the Trustee; the
costs of the Trustee (including its legal counsel) in the discharge of the duties required of
it under the Indenture; the costs to the City, CFD No. 2015-1, or any designee thereof of
complying with arbitrage rebate requirements; the costs to the City, CFD No. 2015-1, or
any designee thereof of complying with City, CFD No. 2015-1, or obligated persons
disclosure requirements associated with applicable federal and state securities laws and of
the Act; the costs associated with preparing Special Tax disclosure statements and
responding to public inquiries regarding the Special Taxes; the costs of the City, CFD
No. 2015-1 or any designee thereof related to an appeal of the Special Tax; the costs
associated with the release of funds from any escrow account; and the City’s annual
administration fees, and third party expenses. Administrative Expenses shall also include
amounts estimated or advanced by the City or CFD No. 2015-1 for any other
administrative purposes of CFD No. 2015-1, including attorney’s fees and other costs
related to commencing and pursuing any foreclosure, or other resolution of delinquent
Special Taxes.
A-1
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“Affordable Housing” means residential Dwelling Units, located on one or more
Assessor’s Parcels of Residential Property, that are subject to deed restrictions, resale
restrictions, and/or regulatory agreements recorded in favor of the City that restrict rents
or prices chargeable to “lower income households” (as defined in California Health and
Safety Code Section 50079.5 or any successor code section).
“Assessor’s Parcel” means a lot or parcel shown in an Assessor’s Parcel Map with an
assigned Assessor’s parcel number.
“Assessor’s Parcel Map” means an official map of the Assessor of the County
designating parcels by Assessor’s parcel number.
“Assigned Special Tax” means the Special Tax for each Land Use Class of Developed
Property, as determined in accordance with Section C below.
“Backup Special Tax” means the Special Tax applicable to each Assessor’s Parcel of
Developed Property, as determined in accordance with Section C below.
“Bonds” means any bonds or other debt (as defined in Section 53317(d) of the Act),
whether in one or more series, issued by CFD No. 2015-1 under the Act.
“Capitalized Interest” means monies deposited in any capitalized interest account
established under the Indenture that are available to pay interest on Bonds.
“CFD Administrator” means an official of the City, or designee thereof, responsible for
determining the Special Tax Requirement and providing for the levy and collection of the
Special Taxes.
“CFD No. 2015-1” means City of Davis Community Facilities District No. 2015-1
(Cannery).
“City” means the City of Davis
“Council” means the City Council of the City.
“County” means the County of Yolo.
“Developed Property” means, for each Fiscal Year, all Taxable Property, exclusive of
Taxable Property Owner Association Property and Taxable Public Property, for which a
building permit for new construction was issued prior to May 1 of the previous Fiscal
Year.
“Dwelling Unit” means one residential unit of any configuration, including, but not
limited to, a single family attached or detached dwelling, condominium, apartment,
mobile home, or otherwise.
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“Final Map” means (i) a final map, or portion thereof, approved by the County pursuant
to the Subdivision Map Act (California Government Code Section 66410 et seq.) that
creates individual lots or parcels for which building permits may be issued, or (ii) for
condominiums, a final map approved by the County and a condominium plan recorded
pursuant to California Civil Code Section 1352 creating such individual lots or parcels.
The term “Final Map” shall not include any Assessor’s Parcel Map or subdivision map or
portion thereof, which does not create individual lots for which a building permit may be
issued, including Assessor’s Parcels that are designated as remainder parcels.
“Final Subdivision” means a subdivision of property which occurred prior to January 1
of the Fiscal Year preceding the Fiscal Year for which the Special Taxes are being levied,
by recordation of a final map, parcel map, or lot line adjustment, approved by the City
pursuant to the Subdivision Map Act (California Government Code Section 66410 et
seq.), or recordation of a condominium plan pursuant to California Civil Code Section
1352 that, in either case, creates individual lots for which building permits may be issued
without further subdivision. Notwithstanding the above, a condominium plan for which
one or more building permits have been issued but no individual lots have been created
for such building permits, shall be considered a Final Subdivision, and the portion of the
condominium plan for which building permits have been issued shall be defined as
Developed Property.
“Fiscal Year” means the period starting July 1 and ending on the following June 30.
“Indenture” means the indenture, fiscal agent agreement, resolution, or other instrument
pursuant to which Bonds are issued, as modified, amended, and/or supplemented from
time to time.
“Land Use Class” means any of the classes listed in Table 1 below.
“Maximum Special Tax” means, for each Assessor’s Parcel, the Maximum Special Tax,
determined in accordance with Section C below, that can be levied in any given Fiscal
Year on such Assessor’s Parcel.
“Non-Residential Floor Area” means the total building square footage of the nonresidential building(s) or the non-residential portion of a building with both residential
and non-residential areas located on an Assessor’s Parcel of Developed Property,
measured from outside wall to outside wall, exclusive of overhangs, porches, patios,
carports, or similar spaces attached to the building but generally open on at least two
sides. The determination of Non-Residential Floor Area shall be made by reference to
the building permit(s) issued for such Assessor’s Parcel and/or to the appropriate records
kept by the City’s Building Division, as reasonably determined by the City.
“Non-Residential Property” means all Developed Property for which a building
permit(s) was issued for a non-residential use.
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“Outstanding Bonds” means all Bonds which are deemed to be outstanding under the
Indenture.
“Property Owner Association Property” means, for each Fiscal Year, any Assessor’s
Parcel within the boundaries of CFD No. 2015-1 that is owned by a property owner
association, including any master or sub-association.
“Proportionately” means, for Developed Property, that the ratio of the actual Special
Tax levy to the Assigned Special Tax is equal for all Assessor’s Parcels of Developed
Property. For Undeveloped Property, “Proportionately” means that the ratio of the actual
Special Tax levy per Acre to the Maximum Special Tax per Acre is equal for all
Undeveloped Property. For Taxable Public Property and Taxable Property Owner
Association Property, “Proportionately” means that the ratio of the actual Special Tax
levy per Acre to the Maximum Special Tax per Acre is equal for all Assessor’s Parcels of
Taxable Public Property or Taxable Property Owner Association Property, as applicable.
“Public Property” means, for each Fiscal Year, any Assessor’s Parcel within CFD No.
2015-1 that is owned by, irrevocably offered for dedication to, or dedicated to the federal
government, the State, the County, the City, or any other public agency as of June 30 of
the prior Fiscal Year; provided however that any property leased by a public agency to a
private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and
classified in accordance with its use. To ensure that property is classified as Public
Property in the first Fiscal Year after it is acquired by, irrevocably offered for dedication
to, or dedicated to a public agency, the property owner shall notify the CFD
Administrator in writing of such acquisition, offer, or dedication not later than June 30 of
the Fiscal Year in which the acquisition, offer, or dedication occurred.
“Residential Floor Area” means all of the square footage of living area within the
perimeter of a Dwelling Unit, not including any carport, walkway, garage, overhang,
patio, enclosed patio, or similar area. The determination of Residential Floor Area shall
be made by reference to the building permit(s) issued for such Dwelling Unit.
“Residential Lot” means an individual residential lot, identified and numbered on a
recorded Final Map, for which a building permit has been, or under law and City
planning decisions, could be issued for a residential structure without further subdivision
of the lot and for which no further subdivision of the lot is anticipated pursuant to an
approved tentative map.
“Residential Property” means all Developed Property for which a building permit has
been issued for purposes of constructing one or more Dwelling Units.
“Special Tax” means the special tax to be levied in each Fiscal Year on each Assessor’s
Parcel of Taxable Property to fund the Special Tax Requirement.
“Special Tax Requirement” means that amount required in any Fiscal Year for CFD
No. 2015-1 to: (i) pay debt service on all Outstanding Bonds; (ii) pay periodic costs on
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the Bonds, including but not limited to, credit enhancement and rebate payments on the
Bonds; (iii) pay Administrative Expenses; (iv) pay any amounts required to establish or
replenish any reserve funds for all Outstanding Bonds; (v) pay directly for acquisition or
construction of facilities eligible to be financed by CFD No. 2015-1, to the extent that the
inclusion of such amount does not increase the Special Tax levy beyond the first step in
Section D; (vi) pay for reasonably anticipated delinquent Special Taxes based on the
delinquency rate for Special Taxes levied in the previous Fiscal Year; less (vii) a credit
for funds available to reduce the annual Special Tax levy, as determined by the CFD
Administrator pursuant to the Indenture.
“State” means the State of California.
“Taxable Property” means all of the Assessor’s Parcels within the boundaries of CFD
No. 2015-1 which are not exempt from the Special Tax pursuant to law or Section E
below.
“Taxable Property Owner Association Property” means all Assessor’s Parcels of
Property Owner Association Property that are not exempt pursuant to Section E below.
“Taxable Public Property” means all Assessor’s Parcels of Public Property that are not
exempt pursuant to Section E below.
“Total Floor Area” means the sum of the Residential Floor Area plus the NonResidential Floor Area located on an Assessor’s Parcel.
“Trustee” means the trustee or fiscal agent under the Indenture.
“Undeveloped Property” means, for each Fiscal Year, all Taxable Property not
classified as Developed Property, Taxable Property Owner Association Property or
Taxable Public Property.
B.
ASSIGNMENT TO LAND USE CATEGORIES
Each Fiscal Year, commencing Fiscal Year 2015-16, all Taxable Property within CFD
No. 2015-1 shall be classified as Developed Property, Taxable Property Owner
Association Property, Taxable Public Property, or Undeveloped Property, and shall be
subject to Special Taxes in accordance with this rate and method of apportionment
determined pursuant to Sections C and D below. Residential Property shall be assigned
to Land Use Classes 1 through 6, and Non-Residential Property shall be assigned to Land
Use Class 7. The Assigned Special Tax for Residential Property shall be based on the
Residential Floor Area of each Dwelling Unit built or to be built on the Assessor’s Parcel
as reflected on the building permit issued for construction of such Dwelling Units. The
Assigned Special Tax for Non-Residential Property shall be based on the NonResidential Floor Area built or to be built on the Assessor’s Parcel as reflected on the
building permit issued for any non-residential buildings on the Parcel.
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C.
MAXIMUM SPECIAL TAX
1.
Developed Property
a.
Maximum Special Tax
The Maximum Special Tax for each Assessor’s Parcel classified as
Developed Property shall be the greater of (i) the amount derived by
application of the Assigned Special Tax or (ii) the amount derived by
application of the Backup Special Tax.
b.
Assigned Special Tax
The Fiscal Year 2015-16 Assigned Special Tax for each Land Use Class is
shown below in Table 1.
TABLE 1
Fiscal Year 2015-16
Assigned Special Taxes for Developed Property
Land Use
Class
Description
Residential Floor Area
Fiscal Year 2015-16
Assigned Special Tax
1
Residential Property
> 3,025 sq. ft.
$3,223 per Dwelling Unit
2
Residential Property
2,575 to 3,024 sq. ft.
$2,725 per Dwelling Unit
3
Residential Property
2,125 to 2,574 sq. ft.
$2,268 per Dwelling Unit
4
Residential Property
1,675 to 2,124 sq. ft.
$1,434 per Dwelling Unit
5
Residential Property
≤ 1,674 sq. ft.
$904 per Dwelling Unit
6
Affordable Housing
NA
7
Non-Residential Property
NA
$0 per Dwelling Unit
$0.26 per Sq. Ft.
of Non-Residential Floor Area
c.
Backup Special Tax
The Fiscal Year 2015-16 Backup Special Tax attributable to a Final
Subdivision will equal $36,038 multiplied by the Acreage of all Taxable
Property, exclusive of any Taxable Property Owner Association Property
and Taxable Public Property, therein. If the Final Subdivision includes
only Residential Lots, the Backup Special Tax for each Residential Lot
shall be computed by dividing the Backup Special Tax attributable to the
applicable Final Subdivision by the number of Residential Lots within that
Final Subdivision. If the Final Subdivision includes only Non-Residential
Property, the Backup Special Tax for each Assessor’s Parcel of NonResidential Property shall be computed by multiplying the Backup Special
Tax by the Acreage of such Assessor’s Parcel.
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If a Final Subdivision includes Assessor’s Parcels of Taxable Property for
which building permits for both residential and non-residential
construction have been issued, excluding Taxable Property Owner
Association Property and Taxable Public Property, then the Backup
Special Tax for each Dwelling Unit shall be calculated according to the
following formula:
Dwelling Unit Backup Special Tax = ((Backup Special Tax) X (Acreage
of Assessor’s Parcel) X (Residential Floor Area/ (Total Floor Area)) /
Number of Residential Dwelling Units)
In this case, the Backup Special Tax for each square foot of NonResidential Floor Area shall be calculated according to the following
formula:
Non-Residential Square Foot Backup Special Tax = ((Backup Special
Tax) X (Acreage of Assessor’s Parcel) X (Non-Residential Floor Area/
(Total Floor Area)) / Non-Residential Floor Area)
Notwithstanding the foregoing, if all or any portion of the Final
Subdivision(s) described in the preceding paragraphs is subsequently
changed or modified by recordation of a lot line adjustment or similar
instrument, and only if the City determines that such change or
modification results in a decrease in the number of Residential Lots within
the Final Subdivision, then the Backup Special Tax for each Assessor’s
Parcel of Developed Property that is affected by the lot line adjustment or
similar instrument for such Final Subdivision shall be a rate per Acre as
calculated below. The Backup Special Tax previously determined for an
Assessor’s Parcel of Developed Property that is not affected by the lot line
adjustment or similar instrument for such Final Subdivision shall not be
recalculated.
d.
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i.
Determine the total Backup Special Tax anticipated to apply to the
changed or modified Final Subdivision area prior to the change or
modification.
ii.
The result of paragraph (i) above shall be divided by the Acreage
of Taxable Property which is ultimately expected to exist in such
changed or modified Final Subdivision area, as reasonably
determined by the City.
iii.
The result of paragraph (ii) above shall be the Backup Special Tax
per Acre which shall be applicable to Assessor’s Parcels of
Developed Property in such changed or modified Final Subdivision
area for all remaining Fiscal Years in which the Special Tax may
be levied.
Increase in the Assigned Special Tax and Backup Special Tax
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On each July 1, commencing on July 1, 2016, the Assigned Special Tax
and the Backup Special Tax shall be increased by an amount equal to two
percent (2.00%) of the amount in effect for the previous Fiscal Year.
2.
Undeveloped Property, Taxable Property Owner Association Property, and
Taxable Public Property
a.
Maximum Special Tax
The Fiscal Year 2015-16 Maximum Special Tax for Undeveloped
Property, Taxable Property Owner Association Property, and Taxable
Public Property in CFD No. 2015-1 shall equal $36,038 per Acre.
b.
Increase in the Maximum Special Tax
On each July 1, commencing on July 1, 2016, the Maximum Special Tax
for Undeveloped Property, Taxable Property Owner Association Property,
and Taxable Public Property shall be increased by an amount equal to two
percent (2.00%) of the amount in effect for the previous Fiscal Year.
3.
Multiple Land Uses
In some instances an Assessor’s Parcel may contain both Undeveloped Property
and Developed Property. Furthermore, Developed Property may contain more
than one Land Use Class.
In such cases, the Acreage of the Assessor’s Parcel shall be allocated between
Developed Property and Undeveloped Property based the portion of the
Assessor’s Parcel for which building permits had been issued prior to May 1 of
the prior Fiscal Year and portion of the Assessor’s Parcel for which building
permits had not been issued prior to May 1 of the prior Fiscal Year. The Acreage
that is considered Developed Property shall be allocated between Residential
Property and Non-Residential Property based on the site plan. If an Assessor’s
Parcel of Developed Property includes both Residential Property and NonResidential Property, the CFD Administrator shall (i) determine the size of each
Dwelling Unit on the Assessor’s Parcel and apply the Assigned Special Tax to
such Dwelling Units, and (ii) review the site plan or condo plan to identify the
Non-Residential Floor Area and apply the Assigned Special Tax accordingly.
The Maximum Special Tax that can be levied on such Assessor’s Parcel shall be
the sum of the Maximum Special Tax that can be levied on each type of property
located on that Assessor’s Parcel.
The CFD Administrator’s allocation to each type of property shall be final.
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D.
METHOD OF APPORTIONMENT OF THE SPECIAL TAX
For each Fiscal Year, commencing Fiscal Year 2015-16, the City shall determine the
Special Tax Requirement and shall levy the Special Tax as follows:
First: Prior to applying Capitalized Interest that is available under the applicable
Indenture, the Special Tax shall be levied Proportionately on each Assessor’s Parcel of
Developed Property up to 100% of the applicable Assigned Special Tax;
Second: If additional monies are needed to satisfy the Special Tax Requirement after the
first step has been completed, the Special Tax shall be levied Proportionately on each
Assessor’s Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax
for Undeveloped Property;
Third: If additional monies are needed to satisfy the Special Tax Requirement after the
first two steps have been completed, then the levy of the Special Tax on each Assessor’s
Parcel of Developed Property whose Maximum Special Tax is determined through the
application of the Backup Special Tax shall be increased in equal percentages from the
Assigned Special Tax up to the Maximum Special Tax for each such Assessor’s Parcel;
Fourth: If additional monies are needed to satisfy the Special Tax Requirement after the
first three steps have been completed, then the Special Tax shall be levied Proportionately
on each Assessor’s Parcel of Taxable Property Owner Association Property and Taxable
Public Property at up to the Maximum Special Tax for Taxable Property Owner
Association Property and Taxable Public Property.
Notwithstanding the above, pursuant to Section 53321(d)(3) of the California
Government Code, under no circumstances will the Special Tax levied in any Fiscal Year
against any Assessor’s Parcel for which an occupancy permit for private residential use
has been issued be increased as a consequence of delinquency or default by the owner or
owners of any other Assessor’s Parcel(s) within CFD No. 2015-1 by more than ten
percent (10%) above the amount that would have been levied in that Fiscal Year had
there never been any such delinquencies or defaults. To the extent that the levy of the
Special Tax on Residential Property is limited by the provision in the previous sentence,
the levy of the Special Tax on each Assessor’s Parcel of Non-Residential Property shall
continue in equal percentages at up to 100% of the Assigned Special Tax.
E.
EXEMPTIONS
No Special Tax shall be levied on up to 51.50 acres of Public Property and 0.89 acres of
Property Owner Association Property. No Special Tax shall be levied on any Affordable
Housing in CFD No. 2015-1 provided that the number of such Dwelling Units in CFD
No. 2015-1 does not cause the total of Dwelling Units within CFD No. 2015-1 to be
reduced below 463 Dwelling Units. Tax-exempt status will be assigned by the CFD
Administrator in the chronological order in which property becomes Property Owner
Association Property, Public Property, or Affordable Housing. However, should an
Assessor’s Parcel no longer be classified as Property Owner Association Property, Public
Property, or Affordable Housing, its tax-exempt status will be revoked.
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Property Owner Association Property and Public Property that is not exempt from
Special Taxes under this section shall be Taxable Property Owner Association Property
or Taxable Public Property, and taxed as set forth herein.
Property no longer classified as Affordable Housing shall be subject to the levy of the
Special Tax and Dwelling Units on such property shall be taxed Proportionately as
Residential Property in Section D above, at up to 100% of the applicable Maximum
Special Tax for the applicable Land Use Class 1-5.
F.
INTERPRETATION OF SPECIAL TAX FORMULA
The City may interpret this Rate and Method of Apportionment for purposes of clarifying
any ambiguity as it relates to the Special Tax rate, the method of apportionment, the
allocation of Special Taxes among Assessor’s Parcels, the classification of properties, or
any definition applicable to the CFD.
G.
MANNER OF COLLECTION
The Special Tax will be collected in the same manner and at the same time as ordinary ad
valorem property taxes; provided, however, that the City may directly bill the Special
Tax, collect Special Taxes at a different time or in a different manner if necessary to meet
its financial obligations, and covenant to foreclose and actually foreclose on delinquent
Assessor’s Parcels as permitted by the Act.
H.
PREPAYMENT OF SPECIAL TAX
The following definition applies to this Section H:
“CFD Public Facilities Cost” means either $11.8 million in 2015 dollars, which shall
increase by the Inflator on July 1, 2016, and on each July 1 thereafter, or such lower
number as (i) shall be determined by the City as sufficient to provide the public facilities
to be provided by CFD No. 2015-1 under the authorized bonding program for CFD No.
2015-1, or (ii) shall be determined by the City concurrently with a covenant that it will
not issue any more Bonds to be supported by Special Taxes levied under this Rate and
Method of Apportionment of Special Tax.
“Construction Fund” means an account specifically identified in the Indenture to hold
funds which are currently available for expenditure to acquire or construct public
facilities eligible under the Act.
“Construction Inflation Index” means the annual percentage change in the Engineering
News Record Building Cost Index for the City of San Francisco, measured as of the
calendar year which ends in the previous Fiscal Year. In the event this index ceases to be
published, the Construction Inflation Index shall be another index as determined by the
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City that is reasonably comparable to the Engineering News Record Building Cost Index
for the City of San Francisco.
“Inflator” means, in any Fiscal Year, the greater of (i) the annual percentage change in
the Construction Inflation Index, as calculated for the twelve (12) months ending
December 31 of the prior calendar year or (ii) three percent (3.00%).
“Future Facilities Costs” means the CFD Public Facilities Cost minus (i) public facility
costs previously paid from the Construction Fund, (ii) monies currently on deposit in the
Construction Fund, and (iii) monies currently on deposit in an escrow fund that are
expected to be available to finance facilities costs.
“Outstanding Bonds” means all Previously Issued Bonds which are deemed to be
outstanding under the Indenture after the first interest and/or principal payment date
following the current Fiscal Year.
“Previously Issued Bonds” means all Bonds that have been issued by CFD No. 2015-1
prior to the date of prepayment.
1.
Prepayment in Full
The obligation of an Assessor’s Parcel to pay the Special Tax may be prepaid
and permanently satisfied as described herein; provided that a prepayment may be
made only if there are no delinquent Special Taxes with respect to such
Assessor’s Parcel at the time of prepayment. An owner of an Assessor’s Parcel
intending to prepay the Special Tax obligation shall provide the CFD
Administrator with written notice of intent to prepay. Within thirty (30) days of
receipt of such written notice, the CFD Administrator shall notify such owner of
the prepayment amount for such Assessor’s Parcel. The CFD Administrator may
charge a reasonable fee for providing this service. Prepayment must be made not
less than forty-five (45) days prior to the next occurring date that notice of
redemption of Bonds from the proceeds of such prepayment may be given to the
Trustee pursuant to the Indenture.
The Prepayment Amount (defined below) shall be calculated as summarized
below (capitalized terms as defined below):
Bond Redemption Amount
plus
Redemption Premium
plus
Future Facilities Amount
plus
Defeasance Amount
plus
Administrative Fees and Expenses
less
Reserve Fund Credit
less
Capitalized Interest Credit
Total: equals
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As of the proposed date of prepayment, the Prepayment Amount (defined below)
for an Assessor’s Parcel shall be calculated as follows:
Paragraph No.:
1.
Confirm that no Special Tax delinquencies apply to such Assessor’s Parcel.
2.
For Assessor’s Parcels of Developed Property, compute the Assigned Special Tax
and Backup Special Tax applicable to the Assessor’s Parcel to be prepaid. For
Assessor’s Parcels of Undeveloped Property (for which a building permit has
been issued) to be prepaid, compute the Assigned Special Tax and Backup
Special Tax for that Assessor’s Parcel as though it was already designated as
Developed Property, based upon the building permit which has already been
issued for that Assessor’s Parcel.
3.
(a) Divide the Assigned Special Tax computed pursuant to paragraph 2 by the
total estimated Assigned Special Taxes for the entire CFD No. 2015-1 based on
the Developed Property Special Taxes which could be charged in the current
Fiscal Year on all expected development through buildout of CFD No. 2015-1,
excluding any Assessor’s Parcels which have been prepaid, and
(b) Divide the Backup Special Tax computed pursuant to paragraph 2 by the
estimated Backup Special Taxes at buildout of CFD No. 2015-1 using the Backup
Special Tax amount for the current Fiscal Year, excluding any Assessor’s Parcels
which have been prepaid.
4.
Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the
Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and
prepaid (the “Bond Redemption Amount”).
5.
Multiply the Bond Redemption Amount computed pursuant to paragraph 4 by the
applicable redemption premium, if any, on the Outstanding Bonds to be redeemed
(the “Redemption Premium”).
6.
Compute the current Future Facilities Costs.
7.
Multiply the larger quotient computed pursuant to paragraph 3(a) or 3(b) by the
amount determined pursuant to paragraph 6 to compute the amount of Future
Facilities Costs to be prepaid (the “Future Facilities Amount”).
8.
Compute the amount needed to pay interest on the Bond Redemption Amount
from the first bond interest and/or principal payment date following the current
Fiscal Year until the earliest redemption date for the Outstanding Bonds.
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9.
Determine the Special Taxes levied on the Assessor’s Parcel in the current Fiscal
Year which have not yet been paid.
10.
Compute the minimum amount the CFD Administrator reasonably expects to
derive from the reinvestment of the Prepayment Amount (as defined below) less
the Future Facilities Amount and the Administrative Fees and Expenses (as
defined below) from the date of prepayment until the redemption date for the
Outstanding Bonds to be redeemed with the prepayment.
11.
Add the amounts computed pursuant to paragraphs 8 and 9 and subtract the
amount computed pursuant to paragraph 10 (the “Defeasance Amount”).
12.
Verify the administrative fees and expenses of CFD No. 2015-1, including the
costs of computation of the prepayment, the costs to invest the prepayment
proceeds, the costs of redeeming Bonds, and the costs of recording any notices to
evidence the prepayment and the redemption (the “Administrative Fees and
Expenses”).
13.
If reserve funds for the Outstanding Bonds, if any, are at or above 100% of the
reserve requirement (as defined in the Indenture) on the prepayment date, a
reserve fund credit shall be calculated as a reduction in the applicable reserve
requirement for the Outstanding Bonds to be redeemed pursuant to the
prepayment (the “Reserve Fund Credit”). No Reserve Fund Credit shall be
granted if reserve funds are below 100% of the reserve requirement.
14.
If any capitalized interest for the Outstanding Bonds will not have been expended
at the time of the first interest and/or principal payment following the current
Fiscal Year, a capitalized interest credit shall be calculated by multiplying the
larger quotient computed pursuant to paragraph 3(a) or 3(b) by the expected
balance in the capitalized interest fund after such first interest and/or principal
payment (the “Capitalized Interest Credit”).
15.
The Special Tax prepayment is equal to the sum of the amounts computed
pursuant to paragraphs 4, 5, 7, 11 and 12, less the amounts computed pursuant to
paragraphs 13 and 14 (the “Prepayment Amount”).
16.
From the Prepayment Amount, the amounts computed pursuant to paragraphs 4,
5, 11, 13 and 14 shall be deposited into the appropriate fund as established under
the Indenture and be used to retire Outstanding Bonds or make debt service
payments. The amount computed pursuant to paragraph 7 shall be deposited into
the Construction Fund. The amount computed pursuant to paragraph 12 shall be
retained by CFD No. 2015-1.
The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of
Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be
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retained in the appropriate fund established under the Indenture to be used with the next
prepayment of Bonds or to make debt service payments.
As a result of the payment of the current Fiscal Year’s Special Tax levy as determined
under paragraph 9 (above), the CFD Administrator shall remove the current Fiscal Year’s
Special Tax levy for such Assessor’s Parcel from the County tax rolls. With respect to
any Assessor’s Parcel that is prepaid, the City shall cause a suitable notice to be recorded
in compliance with the Act, to indicate the prepayment of Special Taxes and the release
of the Special Tax lien on such Assessor’s Parcel, and the obligation of such Assessor’s
Parcel to pay the Special Tax shall cease.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the
amount of Assigned Special Taxes that may be levied on Taxable Property (excluding
Taxable Property Owner Association Property and Taxable Public Property) within CFD
No. 2015-1 both prior to and after the proposed prepayment, less expected Administrative
Expenses, is at least 1.1 times the applicable annual debt service on all Outstanding
Bonds.
2.
Prepayment in Part
The Special Tax on an Assessor’s Parcel of Developed Property or an Assessor’s
Parcel of Undeveloped Property for which a building permit has been issued may
be partially prepaid. The amount of the prepayment shall be calculated as in
Section H.1; except that a partial prepayment shall be calculated according to the
following formula:
PP = (P E – A) x F + A
These terms have the following meaning:
PP =
PE =
the partial prepayment
the Prepayment Amount calculated according to Section H.1
F=
the percentage by which the owner of the Assessor’s
Parcel(s) is partially prepaying the Special Tax.
A = the Administration Fees and Expenses from Section H.1
The owner of any Assessor’s Parcel who desires such partial prepayment shall
notify the CFD Administrator of such owner’s intent to partially prepay the
Special Tax and the percentage by which the Special Tax shall be prepaid. The
CFD Administrator shall provide the owner with a statement of the amount
required for the partial prepayment of the Special Tax for an Assessor’s Parcel
within thirty (30) days of the request and may charge a reasonable fee for
providing this service. With respect to any Assessor’s Parcel that is partially
prepaid, the City shall (i) distribute the funds remitted to it according to Section
H.1, and (ii) indicate in the records of CFD No. 2015-1 that there has been a
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partial prepayment of the Special Tax and that only the remaining percentage
(1.00 - F) of the Maximum Special Tax shall apply to such Assessor’s Parcel.
Notwithstanding the foregoing, no Special Tax prepayment shall be allowed
unless the amount of Assigned Special Taxes that may be levied on Taxable
Property (excluding Taxable Property Owner Association Property and Taxable
Public Property) within CFD No. 2015-1 both prior to and after the proposed
prepayment, less expected Administrative Expenses, is at least 1.1 times the
maximum annual debt service on all Outstanding Bonds.
I.
TERM OF SPECIAL TAX
The Special Tax shall terminate and no longer be levied or collected pursuant to this Rate
and Method of Apportionment on the date that is the later of (i) the Fiscal Year
immediately following the thirtieth (30th) anniversary of the date on which the CFD No.
2015-1 Bonds were sold or (ii) Fiscal Year 2045-46. Notwithstanding the foregoing, if
Special Taxes have been levied on, but not yet collected from, any Assessor’s Parcel in
the CFD at the later of the dates set forth above, such Special Taxes shall remain due and
payable.
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RESOLUTION NO. _____
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
DAVIS DECLARING NECESSITY FOR PROPOSED
COMMUNITY FACILITIES DISTRICT NO. 2015-1
(CANNERY) OF THE CITY OF DAVIS TO INCUR
BONDED INDEBTEDNESS
WHEREAS, pursuant to Section 53321 of the California Government Code, the City Council
(the “City Council”) of the City of Davis (the “City”) has adopted a resolution declaring its
intention to establish proposed Community Facilities District No. 2015-1 (Cannery) of the City
of Davis, County of Yolo, State of California (“CFD No. 2015-1”), for the purpose of providing
and financing public facilities that are necessary to meet increased demands placed upon the City
as a result of development that will occur within said proposed community facilities district (the
“Resolution of Intention”); and
WHEREAS, the City Council has determined that it is necessary for CFD No. 2015-1 to incur a
bonded indebtedness for the purpose of providing and financing such public facilities; and
WHEREAS, it is therefore necessary for CFD No. 2015-1 to incur a bonded indebtedness for the
purpose of providing and financing public facilities pursuant to Section 3 of the Resolution of
Intention (the “Facilities”).
NOW, THEREFORE, BE IT RESOLVED, DETERMINED AND ORDERED BY THE CITY
COUNCIL OF THE CITY OF DAVIS, CALIFORNIA, AS FOLLOWS:
Section 1.
Bonded Indebtedness. The City Council declares that it is necessary that bonded
indebtedness be incurred by and for CFD No. 2015-1 in an aggregate principal amount not to
exceed $17,000,000 for the purpose of financing the design, construction and acquisition of the
Facilities, as they are described in the Resolution of Intention.
Section 2.
Costs Included. The amount of the proposed bonded indebtedness shall include
all costs and estimated costs incidental to, or connected with, the accomplishment of the
purposes for which the proposed bonded indebtedness is to be incurred, including, but not
limited to, the estimated costs of construction and acquisition of the public facilities which are
proposed to be provided within and for CFD No. 2015-1, acquisition of land and rights-of-way,
satisfaction of contractual obligations relating to expenses or the advancement of funds for
expenses existing at the time the bonds are issued, architectural, engineering, inspection, legal,
fiscal and financial consultant fees, bond and other reserve funds and interest on any bonds of
CFD No. 2015-1 estimated to be due and payable within two years from the date of the issuance
of such bonds, election costs, and all costs of issuance of the bonds, including, but not limited to,
underwriter's discount, fees for bond counsel, disclosure counsel, appraisers, financial advisors,
market absorption consultants and other consultants, costs of obtaining credit ratings, bond
insurance premiums, fees for letters of credit, and other credit enhancement costs, and printing
costs.
Section 3.
Payment of Bonded Indebtedness. Pursuant to Section 4 of the Resolution of
Intention and Section 53350 of the California Government Code, all parcels of taxable property
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within the territory of the proposed community facilities district shall be subject to the levy of
special taxes to pay the principal of and interest on the aggregate principal amount of the CFD
No. 2015-1 bonds that may be issued and sold to finance the Facilities.
Section 4.
Hearing. A public hearing on the proposed bonded indebtedness for CFD No.
2015-1 shall be held at a meeting commencing at 6:30 p.m. on May 5, 2015 in the Community
Chambers at City Hall located at 23 Russell Boulevard, Davis, California. Said hearing shall be
conducted concurrently with the hearing on the formation of CFD No. 2015-1.
Section 5.
Notice. The City Clerk shall publish a notice of the time and place of said hearing
pursuant to Section 53346 of the California Government Code, and shall also give notice of the
time and place of said hearing by first-class mail to each registered voter and to each landowner
within the proposed community facilities district.
Section 6.
Effective Date. This Resolution shall take effect from and after the date of its
passage and adoption.
PASSED AND ADOPTED by the City Council of the City of Davis this 17th day of March,
2015.
AYES:
NOES:
________________________________________
Daniel M. Wolk
Mayor
ATTEST:
_________________________________
Zoe S. Mirabile, CMC
City Clerk
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RESOLUTION NO. ________
A RESOLUTION OF THE CITY COUNCIL OF THE CITY
OF DAVIS DECLARING ITS INTENT TO ISSUE TAXEXEMPT BONDS TO BE USED TO REIMBURSE THE
CITY FOR EXPENDITURES PRIOR TO THE ISSUANCE
OF TAX-EXEMPT BONDS
WHEREAS, the City of Davis (the “City”) desires and intends to finance the construction and
acquisition of various public facilities within the proposed City of Davis Community Facility
District No. 2015-1 (Cannery) in furtherance of its municipal purposes (the “Project”); and
WHEREAS, the City expects to cause the execution, delivery and sale of tax exempt obligations
such as bonds, in one or more series, for the purpose of providing financing for all or a portion of
the Project in a principal amount of approximately $17,000,000 (the “Obligations”); and
WHEREAS, the City expects to incur certain expenditures relating to the Project and to pay for
such expenditures from the City’s moneys on hand prior to the execution of the Obligations (the
“Reimbursement Expenditures”); and
WHEREAS, the City reasonably expects to use a portion of the proceeds of the Obligations to
reimburse the City for expenditures made prior to the date the Obligations are entered into:
NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF DAVIS DOES HEREBY
RESOLVE AS FOLLOWS:
Section 1. Declaration of Official Intent. The City hereby declares its official intent, subject to
the further approval of this Council, to use up to $17,000,000 of the proceeds of the Obligations
to reimburse itself for the Reimbursement Expenditures. It is intended that this Resolution shall
constitute a declaration of “official intent” within the meaning of Section 1.150-2 of the Treasury
Regulations promulgated under Section 150 of the Internal Revenue Code of 1986, as amended.
Section 2. Other Approvals. The adoption of this Resolution shall not bind the City to proceed
with execution and delivery of the Obligations until and unless all other necessary actions and
approvals are taken or received in accordance with all applicable laws.
Section 3. Effective Date. This Resolution shall take effect from and after the date of its passage
and adoption.
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PASSED AND ADOPTED by the City Council of the City of Davis this 17th day of March,
2015.
AYES:
NOES:
________________________________________
Dan Wolk
Mayor
ATTEST:
_________________________________
Zoe S. Mirabile, CMC
City Clerk
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