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HomeMy WebLinkAboutOld Greenwood Reimbursements COMMUNITY FACILITIES DISTRICT FUNDING AND REIMBURSEMENT AGREEMENT (OLD GREENWOOD) THIS COMMUNITY FACILITIES DISTRICT FUNDING AND REIMBURSEMENT AGREEMENT (OLD GREENWOOD) (this "Agreement"), dated as of August 6, 2003, is entered into by and between the TRUCKEE DONNER PUBLIC UTILITY DISTRICT, a public agency drily organized and validly existing under the laws of the State of California (the"PUD"), and TRUCKEE LAND, LLC, a Delaware limited liability company(the"Developer"). RECITALS: A. The Developer has requested that the PUD form a community facilities district to be known as "Truckee Donner Public Utility District Community Facilities District No. 03-1" (the "CFD")to issue bonds for the purpose of financing various public facilities necessary or desirable in connection with the development of Developer's project known as "Old Greenwood." B. The PUD and the Developer expect that the PUD would incur expenses in undertaking to study the appropriateness of forming the CFD and issuing bonds, and the Developer is willing to provide funds with which the PUD may pay such expenses. C. Pursuant to California Government Code Section 53314.9, the Board of Directors of the PUD is authorized to accept advances of funds or work-in-kind from any source, including, but not limited to, private persons or private entities, and may provide, by resolution, for the use of those funds or work-in-kind for any authorized purpose, including, but not limited to, paying any costs incurred by the PUD in connection with the formation of a community facilities district. The Board of Directors of the PUD is also authorized to enter into an agreement, by resolution, with the person or entity advancing the funds or work-in-kind to repay all or a portion of the funds advanced or to reimburse the person or entity for the cost or value of the work-in-kind provided that certain conditions are met. The conditions to be satisfied with respect to funds advanced require that (1)the proposal to repay the funds or to pay the cost or value of the work-in-kind must be included in the resolution of intention for the proposed community facilities district and in the resolution of formation for the proposed community facilities district, (2) that any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act and that, if a proposed special tax is not approved, any funds advanced which have not been committed for any authorized purpose by the time of the election must be returned to the person or entity advancing funds and(3) any work-in-kind accepted shall have been performed or constructed as if the work had been performed or constructed under the direction and supervision, or under the authority, of the local agency. D. The PUD and the Developer are desirous of entering into this Agreement in accordance with Government Code Section 53314.9 in order to provide a mechanism by which the Developer may advance certain costs and provide work-in-kind related to the PUD's study of the possible formation of the CFD and, if the PUD determines to proceed with the formation of the CFD, to assist the PUD in connection therewith and with the possible issuance of bonds and the CFD, when and if bonds are issued and proceeds are available, can reimburse the Developer for the amounts advanced and/or pay the Developer for the cost or value of the work-in-kind supplied by the Developer. oocs00984269v2,22925.0009 AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows: 1. Recitals. Each of the above recitals is incorporated herein and is true and correct. 2. Proposed Formation of the CFD and Issuance of Bonds (a) The PUD will undertake to analyze the appropriateness of forming the CFD and the issuance of bonds by it and either has retained or will retain, at the Developer's expense, the consultants that the PUD determines necessary or convenient to assist it in studying the proposed formation of the CFD and, if the PUD determines to proceed with the formation of the CFD, to assist it in connection therewith and with the possible issuance of bonds, including a special tax consultant, a financial advisor,bond counsel, special counsel, an appraiser and other consultants deemed necessary by the PUD. In addition, the cost of PUD staff time spent in connection with the foregoing (as reasonably determined by the PUD based on (i) its estimate of the total hourly cost to the PUD for each of its employees who spends time in connection therewith times (it) its estimate of the number of hours so spent by each such employee) shall be at Developer's expense. (b) In order to begin the process of analyzing the formation of the CFD and the issuance of bonds, concurrently with its execution and delivery hereof,the Developer will deliver to the PUD the sum of$20,000. From time to time, the Developer shall make additional advances to the PUD within 15 business days following receipt from the PUD of a request for an additional advance to cover the costs described herein. In the event the Developer does not deliver the requested amount to the PUD within such 15-business day period,the PUD will have no obligation to proceed with any activity relating to the formation of the CFD and/or the issuance of bonds. The Developer shall have the right to notify the PUD at any time, in writing, of its intention to abandon the formation of the CFD or the issuance of bonds. Upon receipt of such notice, the PUD shall instruct its consultants to cease work as soon as practicable. The Developer shall be responsible for all costs and expenses incurred by the PUD or any PUD consultant or advisor relating to the proposed formation of the CFD and/or bond issuance until work with respect to the proposed formation or bond issuance ceases following the receipt of the Developer's notice of abandonment. (c) The PUD will provide written notice to the Developer when the remaining balance of the Developer's advances is reduced to less than $5,000. The PUD will provide to the Developer from time to time a summary of how the advances have been spent,the unexpended balance remaining and the estimated costs to complete the studies contemplated hereby. The amounts advanced by the Developer will be reimbursable to the Developer, without interest, from the proceeds of any bonds issued by the CFD when and if it is formed and its bonds are issued. In the event that bonds are not issued to provide a source of reimbursement to the Developer, the PUD shall have no liability to the Developer to reimburse it for any of amounts previously advanced by the Developer and expended by the PUD. (d) The Developer agrees that any work-in-kind to be performed by or on behalf of it and to be accepted by the PUD or the CFD shall be performed or constructed as if the work had been performed or constructed under the direction and supervision, or under the authority, of the PUD. In the event it is not so performed or constructed,the Developer shall not be entitled to reimbursement for it. It is the intention of the parties that such work may consist of the preparation DOCSOCl984269v2122925.0009 of maps, engineering studies, a rate and method of apportionment of special tax and certain documents relating to formation of the CFD as determined by the PUD. 3. Reimbursement Procedure. In accordance with Government Code Section 53314.9, the parties agree that, if the qualified electors of the proposed CFD do not approve the proposed special tax, the PUD shall return any funds which have been advanced by the Developer pursuant to this Agreement and which have not been committed for any authorized purpose by the time of the election. Such returned funds shall be without interest. 4. Abandonment of Proposed CFD. The Developer understands that a decision to commence formation of the CFD shall be in the sole discretion of the PUD. No provision of this Agreement shall be construed as a promise, warranty or agreement by the PUD to form the CFD or to issue bonds. The PUD shall have no liability to Developer for a decision not to form the CFD or issue bonds. 5. Indemnification and Hold Harmless. The Developer hereby assumes the defense of, and indemnifies and saves harmless, the PUD and each of its officers, directors and employees, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put,by reason of or arising out of any acts or omissions of the Developer or any of the Developer's officers,employees, contractors and agents in connection with the proposed formation of the CFD or any work-in-kind provided by or on behalf of the Developer or its consultants, except for any action, damages, claims, losses or expenses arising out of the sole negligence or willful misconduct of the PUD, its officers, directors, employees or agents. 6. Notices. Any notice to be provided pursuant to this Agreement shall be delivered to the following addresses: Developer: Truckee Land, LLC cio East West Partners P.O. Box 2537 Truckee, California 96160 Attention: Rick McConn PUD: Truckee Donner Public Utility District 11570 Donner Pass Road P. O. Box 309 Truckee, California 96160 Attention: General Manager Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party. 7. Assignment. The Developer may not assign its interest in this Agreement without the prior written consent of the PUD, which consent shall not be unreasonably withheld. 8. Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest extent permitted by law. 9. Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the matters provided for herein. DOCSOC984269v2\22925.0009 10. Amendments. This Agreement may be amended or modified only by written instrument signed by all parties. l l. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. 12. Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. 13. No Third Party Beneficiaries. No person or entity shall be deemed to be a third party beneficiary hereof; and nothing in this Agreement (either express or implied) is intended to confer upon any person or entity, other than the PUD (and its officers, directors, employees and agents providing services under this Agreement) and the Developer, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 14. Singular and Plural; Gender. As used herein,the singular of any word includes the plural, and tens in the masculine gender shall include the feminine. 15. Termination. This Agreement shall terminate and be of no further force and effect on the first anniversary of the date of this Agreement unless expressly amended by the parties;provided, however, that the Developer's obligations under Section 5 shall survive the termination and the PUD's obligation to provide reimbursement in accordance with Section 3 for expenses incurred prior to the termination date shall also survive termination. IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: Peter Holzmeister, General Manager TRUCKEE LAND, LLC By: EAST WEST RESORT DEVELOPMENT V, L.P.,L.L..P., its Manager By: HE HOLDING CORP., its General Partner By: Blake L. Riva, Vice President oOCSOC9842e9Q2 22925.0009 ro COMMUNITY FACILITIES DISTRICT FUNDING AND REIMBURSEMENT AGREEMENT (GRAY'S CROSSING) THIS COMMUNITY FACILITIES DISTRICT FUNDING AND REIMBURSEMENT AGREEMENT (OLD GREENWOOD) (this "Agreement"), dated as of August 6, 2003, is entered into by and between the TRUCKEE DONNER PUBLIC UTILITY DISTRICT, a public agency duly organized and validly existing under the laws of the State of California (the"PUD"), and TRUCKEE LAND,LLC, a Delaware limited liability company (the"Developer'). RECITALS: A. The Developer has requested that the PUD form a community facilities district to be known as "Truckee Donner Public Utility District Community Facilities District No. 03-2" (the "CFD")to issue bonds for the purpose of financing various public facilities necessary or desirable in connection with the development of Developer's project known as "Gray's Crossing." B. The PUD and the Developer expect that the PUD would incur expenses in undertaking to study the appropriateness of forming the CFD and issuing bonds, and the Developer is willing to provide fiends with which the PUD may pay such expenses. C. Pursuant to California Government Code Section 53314.9, the Board of Directors of the PUD is authorized to accept advances of funds or work-in-kind from any source, including, but not limited to, private persons or private entities, and may provide, by resolution, for the use of those funds or work-in-kind for any authorized purpose, including,but not limited to,paying any costs incurred by the PUD in connection with the formation of a community facilities district. The Board of Directors of the PUD is also authorized to enter into an agreement, by resolution, with the person or entity advancing the funds or work-in-kind to repay all or a portion of the funds advanced or to reimburse the person or entity for the cost or value of the work-in-kind provided that certain conditions are met. The conditions to be satisfied with respect to funds advanced require that(1) the proposal to repay the funds or to pay the cost or value of the work-in-kind must be included in the resolution of intention for the proposed community facilities district and in the resolution of formation for the proposed community facilities district, (2)that any proposed special tax is approved by the qualified electors of the community facilities district pursuant to the Act and that, if a proposed special tax is not approved, any funds advanced which have not been committed for any authorized purpose by the time of the election must be returned to the person or entity advancing funds and(3) any work-in-kind accepted shall have been performed or constructed as if the work had been performed or constructed render the direction and supervision, or under the authority, of the local agency. D. The PUD and the Developer are desirous of entering into this Agreement in accordance with Government Code Section 53314.9 in order to provide a mechanism by which the Developer may advance certain costs and provide work-in-kind related to the PUD's study of the possible formation of the CFD and, if the PUD determines to proceed with the formation of the CFD, to assist the PUD in connection therewith and with the possible issuance of bonds and the CFD, when and if bonds are issued and proceeds are available, can reimburse the Developer for the amounts advanced and/or pay the Developer for the cost or value of the work-in-kind supplied by the Developer. 1 DOCS00984634v 1,22925.0009 AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties hereto agree as follows: 1. Recitals. Each of the above recitals is incorporated herein and is true and correct. 2. Proposed Formation of the CFD and Issuance of Bonds. (a) The PUD will undertake to analyze the appropriateness of forming the CFD and the issuance of bonds by it and either has retained or will retain, at the Developer's expense,the consultants that the PUD determines necessary or convenient to assist it in studying the proposed formation of the CFD and, if the PUD determines to proceed with the formation of the CFD, to assist it in connection therewith and with the possible issuance of bonds, including a special tax consultant, a financial advisor, bond counsel, special counsel, an appraiser and other consultants deemed necessary by the PUD. In addition, the cost of PUD staff time spent in connection with the foregoing (as reasonably determined by the PUD based on(i)its estimate of the total hourly cost to the PUD for each of its employees who spends time in connection therewith times (ii) its estimate of the number of hours so spent by each such employee)shall be at Developer's expense. (b) In order to begin the process of analyzing the formation of the CFD and the issuance of bonds, concurrently with its execution and delivery hereof,the Developer will deliver to the PUD the sum of$20,000, From time to time, the Developer shall make additional advances to the PUD within 15 business days following receipt from the PUD of a request for an additional advance to cover the costs described herein. In the event the Developer does not deliver the requested amount to the PUD within such 15-business day period,the PUD will have no obligation to proceed with any activity relating to the formation of the CFD and/or the issuance of bonds. The Developer shall have the right to notify the PUD at any time, in writing, of its intention to abandon the formation of the CFD or the issuance of bonds. Upon receipt of such notice, the PUD shall instruct its consultants to cease work as soon as practicable. The Developer shall be responsible for all costs and expenses incurred by the PUD or any PUD consultant or advisor relating to the proposed formation of the CFD and/or bond issuance until work with respect to the proposed formation or bond issuance ceases following the receipt of the Developer's notice of abandonment. (e) The PUD will provide written notice to the Developer when the remaining balance of the Developer's advances is reduced to less than $5,000. The PUD will provide to the Developer from time to time a summary of how the advances have been spent,the unexpended balance remaining and the estimated costs to complete the studies contemplated hereby. The amounts advanced by the Developer will be reimbursable to the Developer, without interest, from the proceeds of any bonds issued by the CFD when and if it is formed and its bonds are issued. In the event that bonds are not issued to provide a source of reimbursement to the Developer,the PUD shall have no liability to the Developer to reimburse it for any of amounts previously advanced by the Developer and expended by the PUD. (d) The Developer agrees that any work-in-kind to be performed by or on behalf of it and to be accepted by the PUD or the CFD shall be performed or constructed as if the work had been perfonned or constructed under the direction and supervision, or under the authority, of the PUD. In the event it is not so performed or constructed, the Developer shall not be entitled to reimbursement for it. It is the intention of the parties that such work may consist of the preparation 2 DOCSOC\984034v 1A22925.0009 of maps, engineering studies, a rate and method of apportionment of special tax and certain documents relating to formation of the CFD as determined by the PUD. 3. Reimbursement Procedure. In accordance with Government Code Section 53314.9, the parties agree that, if the qualified electors of the proposed CFD do not approve the proposed special tax, the PUD shall return any funds which have been advanced by the Developer pursuant to this Agreement and which have not been committed for any authorized purpose by the time of the election. Such returned funds shall be without interest. 4. Abandonment of Proposed CFD. The Developer understands that a decision to commence formation of the CFD shall be in the sole discretion of the PUD. No provision of this Agreement shall be construed as a promise, warranty or agreement by the PUD to form the CFD or to issue bonds. The PUD shall have no liability to Developer for a decision not to form the CFD or issue bonds. 5. Indemnification and Hold Harmless. The Developer hereby assumes the defense of, and indemnifies and saves harmless, the PUD and each of its officers, directors and employees, from and against all actions, damages, claims, losses or expenses of every type and description to which they may be subjected or put,by reason of or arising out of any acts or omissions of the Developer or any of the Developer's officers,employees, contractors and agents in connection with the proposed formation of the CFD or any work-in-kind provided by or on behalf of the Developer or its consultants, except for any action, damages, claims, losses or expenses arising out of the sole negligence or willful misconduct of the PUD, its officers, directors, employees or agents. 6. Notices. Any notice to be provided pursuant to this Agreement shall be delivered to the following addresses: Developer: Truckee Land, LLC c/o East West Partners P.O. Box 2537 Truckee, California 96160 Attention: Rick McConn PUD: Truckee Donner Public Utility District 11570 Donner Pass Road P. O.Box 309 Truckee, California 96160 Attention: General Manager Each party may change its address for delivery of notice by delivering written notice of such change of address to the other party. 7. Assi ng ment. The Developer may not assign its interest in this Agreement without the prior written consent of the PUD, which consent shall not be unreasonably withheld. 8. Severability. If any part of this Agreement is held to be illegal or unenforceable by a court of competent jurisdiction,the remainder of this Agreement shall be given effect to the fullest extent permitted by law. 3 DOCSOCA984634v IA22925.0009 9. Entire Agreement. This Agreement contains the entire agreement between the parties with respect to the matters provided for herein. 10. Amendments. This Agreement may be amended or modified only by written instrument signed by all parties. IL Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. 11 Governing Law. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. 13, No Third Party Beneficiaries. No person or entity shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement (either express or implied)is intended to confer upon any person or entity, other than the PUT)(and its officers, directors, employees and agents providing services under this Agreement) and the Developer, any rights, remedies, obligations or liabilities under or by reason of this Agreement. 14. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 15. Termination. This Agreement shall terminate and be of no further force and effect on the first anniversary of the date of this Agreement unless expressly amended by the parties; provided, however, that the Developer's obligations under Section 5 shall survive the termination and the PUD's obligation to provide reimbursement in accordance with Section 3 for expenses incurred prior to the termination date shall also survive termination. IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first above written. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: Peter Holzmeister, General Manager TRUCKEE LAND,LLC By: EAST WEST RESORT DEVELOPMENT V, L.P., L.L..P., its Manager By: HE HOLDING CORP., its General Partner By: Blake L. Riva, Vice President 4 DOCSOCA984634v 1 A22925.0009 i RESOLUTION NO. RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DECLARING ITS INTENTION TO ESTABLISH TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-1 (OLD GREENWOOD) AND TO AUTHORIZE THE LEVY OF A SPECIAL TAX WITHIN SAID COMMUNITY FACILITIES DISTRICT WHEREAS, Truckee Land, LLC, the owner(the "Owner") of not less than 10 percent of the area of land depicted on the map of the proposed community facilities district referred to below on file with the District Clerk (the "Property"), has filed a written petition with the Truckee Donner Public Utility District (the "Public Utility District') to establish Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) (the "Community Facilities District") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, commencing with Section 53311 of the Government Code of the Sate of California (the "Act") to finance (i)the cost of purchasing, constructing, expanding, improving or rehabilitating the facilities listed in Appendix A hereto, and all appurtenances and appurtenant work associated therewith (collectively the "Facilities") and (ii) the incidental expenses to be incurred in connection with financing the Facilities, including costs associated with the creation of the Community Facilities District and the issuance of bonds, the establishment and replenishment of bond reserve and special reserve funds (the"Incidental Expenses"); and WHEREAS, the petition submitted by the Owner complies with the requirements of Section 53319 of the Act; and WHEREAS, in connection herewith, this Board of Directors intends to approve an estimate of the costs of the Facilities and the Incidental Expenses for the Community Facilities District; and WHEREAS, subject to the satisfaction of all applicable requirements of law, it is the intention of this Board of Directors to finance the Facilities and to pay for the Incidental Expenses through the formation of the Community Facilities District and the levy of a special tax and the issuance of bonds, provided that the levy of the special tax and the issuance of the bonds are approved at an election to be held within the boundaries of the Community Facilities District; NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. The Community Facilities District is proposed to be established under the terns of the Act. It is further proposed that the boundaries of the Community Facilities District shall be as depicted on the map of the proposed Community Facilities District which is on file with the District Clerk (the "Clerk"). The Clerk is hereby directed to sign the original map of the Community Facilities District and record it with all proper endorsements thereon with the County Recorder of the 1 DOCSOCA97729I v4\22925.0009 County of Nevada within fifteen days after the adoption of this resolution, all as required by Section 3111 of the Streets and Highways Code of the State of California. Section 3. The name of the proposed Community Facilities District shall be "Truckee Donner Public utility District Community Facilities District No. 03-1 (Old Greenwood).- Section 4. The Facilities proposed to be provided within the Community Facilities District are facilities, as defined in the Act, which the Public Utility District, the Truckee Sanitary District or the Town of Truckee is authorized by law to provide or to construct, acquire, own and operate, as the case may be. This Board of Directors hereby finds and determines that the description of the Facilities herein is sufficiently informative to allow taxpayers within the proposed Community Facilities District to understand what the funds of the Community Facilities District may be used to pay for. Certain of the Facilities are expected to be completed prior to the formation of the Community Facilities District; they are the Facilities listed in Appendix B. The Incidental Expenses expected to be incurred include the cost of planning and designing the Facilities, the costs of forming the Community Facilities District and levying and collecting a special tax within the Community Facilities District. Section 5. Except where funds are otherwise available, it is the intention of this Board of Directors to levy annually in accordance with the procedures contained in the Act a special tax, secured by recordation of a continuing lien against all non-exempt real property in the Community Facilities District, sufficient to pay for: (i) the Facilities and Incidental Expenses and (it) the principal of and interest on and other periodic costs with respect to the bonds issued to finance the Facilities, including the establishment and replenishment of any reserve funds deemed necessary by the Community Facilities District and any remarketing, credit enhancement and liquidity facility fees (including such fees for instruments which serve as the basis of a reserve fund in lieu of cash) in connection with the bonds. The Facilities may be financed on a direct payment basis or through the issuance of the bonds. The rate, method of apportionment and manner of collection of the special tax are described in detail in Appendix C attached hereto and incorporated herein as though set forth at length (the "Rate and Method"). Appendix C allows each landowner and resident within the Community Facilities District to estimate the maximum amount that may be levied against each parcel. If special taxes of the Community Facilities District are levied against any parcel used for private residential purposes, (i)such tax shall not be levied or collected to pay for Facilities or Incidental Expenses after the 2044-2045 tax year and (ii) under no circumstances will such special tax be increased as a consequence of delinquency or default by the owner of any other parcel or parcels within the Community Facilities District by more than ten percent. This Board of Directors hereby determines the Rate and Method to be reasonable. The special tax is apportioned to each parcel on the basis of land use and, in some cases, area pursuant to Section 53325.3 of the Act, and such special tax is not on or based upon the value or ownership of real property. In the event that a portion of the property within the Community Facilities District shall become for any reason exempt, wholly or partially, from the levy of the special tax, this Board of Directors shall, on behalf of the Community Facilities District, cause the levy to be increased, subject to the limitation of the maximum special tax for a parcel as set forth in the Rate and Method, to the extent necessary upon the remaining property within the Community Facilities District which is not delinquent or exempt in order to yield the special tax revenues required for the purposes described in this Section 5. 2 DOCSOC,977291 v4\22925.0009 Section 6. A public hearing (the "Hearing") on the establishment of the Community Facilities District and the proposed Rate and Method shall be held at 7:00 p.m., or as soon thereafter as practicable, on October I, 2003, in the board room of this Board of Directors, 11570 Donner Pass Road, Truckee, California 96160. Should this Board of Directors determine to form the Community Facilities District, a special election will be held to authorize the levy of the special tax in accordance with the procedures contained in Government Code Section 53326. If held, the proposed voting procedure at the election will be a landowner vote with each landowner of record as of the close of the Hearing having one vote for each acre of land or portion thereof owned within the Community Facilities District. Ballots for the special election may be distributed by mail or by personal service. Section 7. At the time and place set forth above for the Hearing, any interested person, including all persons owning lands or registered to vote within the proposed Community Facilities District, may appear and be heard. Section 8. Each officer of the Public Utility District who is or will be responsible for providing the Facilities within the proposed Community Facilities District, if it is established, is hereby directed to study the proposed Community Facilities District and, at or before the time of the Hearing, file a report with this Board of Directors containing a brief description of the public facilities by type which will in his or her opinion be required to meet adequately the needs of the proposed Community Facilities District and an estimate of the cost of providing those public facilities and an estimate of the fair and reasonable cost of any Incidental Expenses to be incurred. Section 9. The Public Utility District may accept advances of funds or work-in-kind from any source, including, but not limited to, private persons or private entities, for any authorized purpose, including, but not limited to, paying any cost incurred by the Public Utility District in creating the Community Facilities District The Public Utility District may enter into an agreement with the person or entity advancing the funds or work-in-kind, to repay all or a portion of the funds advanced, or to reimburse the person or entity for the value, or cost, whichever is less, of the work- in-kind,as determined by this Board of Directors, with or without interest. Section 10. The Clerk is hereby directed to publish a notice (the "Notice") of the Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation published in the area of the Community Facilities District. Such publication shall be completed at least seven days prior to the date of the Hearing. The Clerk is further directed to mail a copy of the Notice to each of the landowners and registered voters, if any, within the boundaries of the Community Facilities District at least 15 days prior to the Hearing. The Notice shall contain the text or a summary of this Resolution, the time and place of the Hearing, a statement that the testimony of all interested persons or taxpayers will be heard, a description of the protest rights of the registered voters and landowners in the proposed Community Facilities District and a description of the proposed voting procedure for the election required by the Act. Section 11. Except to the extent limited in any bond resolution or trust indenture related to the issuance of bonds, the Board of Directors hereby reserves to itself all rights and powers set forth in Section 53344.1 of the Act(relating to tenders in full or partial payment). Section 12. The Clerk is hereby authorized and directed to transmit copies of this Resolution to the Town Council of the Town of Truckee. 3 DocsoC\97729 i v4'2292;.0009 ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on August 6, 2003. TRUCKEE DONNER PUBLIC UTILITY DISTRICT President of the Board of Directors ATTEST: District Clerk 4 DOCS00977291 v4\22925.0009 APPENDIX A LIST OF FACILITIES It is intended that the District will finance all or a portion of the costs of the following: L Acquisition or construction of the following public improvements: a. water supply and distribution and fire suppression facilities including: i. offsite water facilities connecting Glenshire Well to water storage facility located within District; it. water storage facility within District including all connections and control devices; in. all water distribution facilities constructed and completed in 2001 connecting water storage facility to road entrance and five cabins near road entrance; iv. 20" water mainline connecting water storage facility to Fiberboard Under- crossing; V. water distribution system serving all residential and commercial properties within District; vi. water source (well) development including surveys, design, drilling,pump installation,building construction and connection to water system; vii. all other water facilities required to service properties within boundaries of the District; b. electrical supply and distribution facilities including: i. offsite electrical facilities connecting Glenshire Drive to Interstate 80 as constructed and completed in 2001; it. all electrical infrastructure required to service residential and commercial parcels within the boundaries of the District including but not limited to design, conduit,trenching, transformers and installation of cabling; C. public roadways including but not limited to medians, curbs, gutters, sidewalks, traffic signals, street signage, street lighting,pavement striping and any associated landscaping and erosion control for the following segments: i. Old Truckee Airport Road from the intersection of the Interstate 80 exit to the eastern property boundary as constructed in 2001; ii. Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of Lot D4; iii. Fairway Drive from 100 meters south of Lot D4 to third intersection with Lookout Loop; iv. all other connecting roadways including Lookout Loop, Lookout Circle, Caleb Drive, Caleb Circle, Settler's Lane, Miner's Trail, Carson Range Court, Legacy Court, Sutter's Trail, Gold Rush Trail, Trapper's Trail, and Frontier Trail; A-1 DOCSOCA97729I v4\22925.0009 d. public access parks and trails; e. sanitary sewer facilities including: i. offsite sewer facilities from Glenshire Drive to sewer lift station as constructed in 2001; ii. sewer lift station including but not limited to wet wells, mechanical, electrical, pumping and building systems as constructed in 2001; iii. onsite sanitary facilities connecting residential and commercial parcels to lift station; iv. all other sanitary facilities required to service residential and commercial parcels within the boundaries of the District; f. storm drains and flood control facilities including but not limited to: i. all v—ditches, culverts, and infiltration ponds associated with Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of Lot D4; ii. all v-ditches, culverts, and infiltration ponds associated with the remaining segments of Fairway Drive, and all other connecting roadways including Lookout Loop, Lookout Circle, Caleb Drive, Caleb Circle, Settler's Lane, Miner's Trail, Carson Range Court, Legacy Court, Sutter's Trail, Gold Rush Trail, Trapper's Trail, and Frontier Trail; g. natural gas,telephone, and telecommunications facilities, including such facilities to be owned by shareholder owned utility companies regulated by the California Public Utilities Commission, and further including trenching and appurtenant work and improvements; h. any other public improvements identified in accordance with the Development Agreement between the Truckee Donner Public Utility District and Old Greenwood, LLC pertaining to the Old Greenwood development project; 2. Any soft cost associated with the design and construction of the above described improvements including but not limited to engineering, environmental review, inspection, surveying and staking, and environmental mitigation. A-2 DOCSOCA977291 v4\22925.0009 APPENDIX B LIST OF FACILITIES EXPECTED TO BE COMPLETE AS OF FORMATION OF CFD It is intended that the Developer will complete as identifiable segments the following facilities: a. water supply and distribution and fire suppression facilities including: i. offsite water facilities connecting Glenshire Well to water storage facility located within District; ii. water storage facility within District including all connections and control devices; iii. all water distribution facilities constructed and completed in 2001 connecting water storage facility to road entrance and five cabins near road entrance; iv. 20"water mainline connecting water storage facility to Fiberboard Under-crossing; V. water distribution system serving all residential and commercial properties adjoining Fairway Drive, Lookout Loop, Settler's Lane, Caleb Drive, Caleb Circle, Lookout Circle and Legacy Court; b. electrical supply and distribution facilities including: i. offsite electrical facilities connecting Glenshire Drive to Interstate 80 as constructed and completed in 2001; ii. all electrical infrastructure required to service residential and commercial parcels adjoining Fairway Drive, Lookout Loop, Settler's Lane, Caleb Drive, Caleb Circle, Lookout Circle and Legacy Court including but not limited to design, conduit, trenching, transformers and installation of cabling; C. public roadways including but not limited to medians, curbs, gutters, sidewalks,traffic signals, street signage, street lighting, pavement striping and any associated landscaping and erosion control for the following segments: i. Old'Truckee Airport Road from the intersection of the Interstate 80 exit to the eastern property boundary as constructed in 2001; ii. Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of Lot D4; iii. Fairway Drive from 100 meters south of Lot D4 to third intersection with Lookout Loop; iv. connecting roadways including Lookout Loop, Lookout Circle, Caleb Drive,Caleb Circle, Settler's Lane, and Legacy Court; d. sanitary sewer facilities including: i. offsite sewer facilities from Glenshire Drive to sewer lift station as constructed in 2001; ii. sewer lift station including but not limited to wet wells,mechanical, electrical, pumping and building systems as constructed in 2001; B-1 DOCSOC97729I v4122925.0009 iii. onsite sanitary facilities connecting residential and commercial parcels adjoining Fairway Drive to lift station; iv. all other sanitary facilities required to service Fairway Drive, Lookout Loop, Settler's Lane, Caleb Drive, Caleb Circle, Lookout Circle and Legacy Court; e. storm drains and flood control facilities including: i. all v—ditches, culverts, and infiltration ponds associated with Fairway Drive from the intersection of Old Truckee Airport Road to 100 meters south of Lot D4; ii. all v- ditches, culverts, and infiltration ponds associated with the remaining segments of Fairway Drive, and all other connecting roadways including Lookout Loop, Lookout Circle, Caleb Drive, Caleb Circle, Settler's Lane, Legacy Court; f. natural gas facilities serving Fairway Drive,Lookout Loop, Settler's Lane, Caleb Drive, Caleb Circle, Lookout Circle and Legacy Court to be owned by shareholder owned Southwest Gas regulated by the California Public Utilities Commission, and further including trenching and appurtenant work and improvements; B-2 DOCSOCA977291 v4\222925.0009 APPENDIX C TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-1 (OLD GREENWOOD) RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A Special Tax applicable to each Assessor's Parcel in the Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) [herein"CFD No. 03-I") shall be levied and collected according to the tax liability determined by the Board of Directors or its designee, through the application of the appropriate amount or rate for Taxable Property,as described below. All of the property in CFD No. 03-1, unless exempted by law or by the provisions of Section G below, shall be taxed for the purposes, to the extent, and in the manner herein provided, including property subsequently annexed to the CFD unless a separate Rate and Method of Apportionment is adopted for the annexation area. 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 or other parcel map recorded with the County. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, (commencing with Section 53311), Division 2 of Title 5 of the California Government Code. "Administrative Expenses"means any or all of the following: the fees and expenses of any fiscal agent or trustee (including any fees or expenses of its counsel) employed in connection with any Bonds,and the expenses of the TDPUD carrying out its duties with respect to CFD No. 03-1 and the Bonds,including,but not limited to,levying and collecting the Special Tax,the fees and expenses of legal counsel, charges levied by the County Auditor's Office, Tax Collector's Office, and/or Treasurer's Office,costs related to annexing property into the CFD,costs related to property owner inquiries regarding the Special Tax, amounts needed to pay rebate to the federal government with respect to the Bonds, costs associated with complying with any continuing disclosure requirements for the Bonds and the Special Tax, and all other costs and expenses of the TDPUD in any way related to the establishment or administration of the CFD. "Administrator"means the person or firm designated by the TDPUD to administer the Special Tax according to this Rate and Method of Apportionment of Special Tax. "Affordable Unit"means any Unit within CFD No. 03-1 which,in the sole discretion of the Town. is either deed-restricted to maintain the affordability of the Unit or is determined by the Administrator to have been planned, designed and/or built to be an affordable unit. TDPUD CFD No. 03-1 7 July 31,2003 "Assessor's Parcel"or"Parcel"means alot or parcel shown on an Assessor's Parcel Map with an assigned Assessor's Parcel number. "Assessor's Parcel Map" means an official map of the County Assessor designating parcels by Assessor's Parcel number. "Association Property" means any property within the CFD that is owned by a homeowners association, excluding Association Property under the pad or footprint of a Unit. "Board of Directors" or "Board" means the Board of Directors of the TDPUD. "Bonds" means bonds or other debt(as defined in the Act), whether in one or more series, issued, insured or assumed by CFD No. 03-1 related to public infrastructure and/or improvements that are authorized to be funded by CFD No. 03-1. "Capitalized Interest"means funds in any capitalized interest account available to pay debt service on Bonds. "CFD Formation" means the date on which the Resolution of Formation to form CFD No. 03-I was adopted by the Board of Directors. "County" means the County of Nevada. "Developed Property" means, in any Fiscal Year, the following: • for Single Family Detached Property,all parcels for which a Final Map was recorded prior to May I of the preceding Fiscal Year • for Single Family Attached Property and Rental Property, all parcels for which a building permit for new construction of a residential structure was issued prior to May 1 of the preceding Fiscal Year. "Excess Public Property"means the acres of Public Property that exceeds the acreage exempted in Section G below. In any Fiscal Year in which a Special Tax must be levied on Excess Public Property pursuant to Step 4 in Section E below, Excess Public Property shall be those Assessor's Parcel(s) that most recently became Public Property based on the dates on which Final Maps recorded creating such Public Property. "Expected Land Uses"means the total number of units expected to be constructed within the CFD as determined from time to time by the Administrator after applying the steps set forth in Section D below. At CFD Formation, the Expected Land Uses were based on the Tentative Map. The Expected Land Uses at CFD Formation are summarized in Attachment 1 hereto;the Administrator shall update Attachment 1 each time a change occurs to the land use plans for property in the CFD. TDPUD CFD No. 03-1 2 July 31,2003 "Expected Maximum Special Tax Revenues"means the amount of annual revenue that would be available if the Maximum Special Tax was levied on the Expected Land Uses. The Expected Maximum Special Tax Revenues as of CFD Formation are shown in Attachment 1 of this Rate and Method of Apportionment of Special Tax. "Final Bond Sale" means the last series of Bonds that will be issued on behalf of CFD No. 03-1 (excluding any Bond refundings), as determined in the sole discretion of the TDPUD. "Final Map" means a final map, or portion thereof, recorded by the County pursuant to the Subdivision Map Act(California Government Code Section 66410 et seq.)that creates individual lots on which building permits for new construction may be issued without further subdivision and for which no further subdivision is anticipated pursuant to the Tentative Map. "Fiscal Year" means the period starting July 1 and ending on the following June 30. "Fractional Unit"means a single family detached unit or a single family attached unit for which multiple owners may each purchase a fractional share of ownership(also referred to as a timeshare unit by the California Department of Real Estate). "Golf Course Property" means any property within CFD No. 03-1 that is used as a golf course, including but not limited to,a driving range,clubhouse,parking,lodge,outbuildings,and other golf- related amenities. Golf Course Property shall also include any property within the CFD that is used for a swim, tennis, and/or fitness facility. "Maximum Special Tax" means the greatest amount of Special Tax that can be levied on an Assessor's Parcel in any Fiscal Year determined in accordance with Section C below, as may be adjusted pursuant to Step 3 in Section D below. "Other Property"means, in any Fiscal Year,all Parcels of Taxable Property which are not Single Family Detached Property or Single Family Attached Property. "Proportionately"means,for Developed Property,that the ratio of the actual Special Tax levied in any Fiscal Year to the Maximum Special Tax authorized to be levied in that Fiscal Year is equal for all Assessor's Parcels of Developed Property, and for Undeveloped Property that the ratio of the actual Special Tax to the Maximum Special Tax is equal for all Assessor's Parcels of Undeveloped Property. "Public Property"means any property within the boundaries of CFD No. 03-1 that is owned by the federal government. State of California, County, Town, TDPUD, or other public agency. "Rental Property" means, in any Fiscal Year, all Parcels within the CFD for which a building permit was issued for construction of a residential structure with multiple Units that share common walls, all of which are offered or are expected to be offered for rent to the general public and/or employees. Fractional Units within the CFD shall at no time be categorized as Rental Property. TDPUD CFD No. 03-1 3 July 31,2003 "SFD Lot" means an individual residential lot, identified and numbered on a recorded Final Map, on which a building permit has been or is permitted to be issued for construction of a single family detached unit without further subdivision of the lot and for which no further subdivision of the lot is anticipated pursuant to the Tentative Map. "Single Family Attached Property"means,in any Fiscal Year,all Parcels of Developed Property for which a building permit was issued for construction of a residential structure consisting of two or more Units that share common walls and are offered or expected to be offered as for-sale units, including attached Fractional Units and such residential structures that meet that statutory definition of a condominium contained in Civil Code Section 1351. "Single Family Detached Property"means,in any Fiscal Year,all Parcels of Developed Property for which a building permit was issued or is permitted to be issued for construction of a Unit that does not share a common wall with another Unit, including detached Fractional Units. "Special Tax" means a Special Tax levied in any Fiscal Year to pay the Special Tax Requirement. "Special Tax Requirement" means the amount necessary in any Fiscal Year to: (i) pay principal and interest on Bonds which is due in the calendar year that begins in such Fiscal Year; (ii) create and/or replenish reserve funds for the Bonds;(iii)cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior Fiscal Year or, based on existing delinquencies in the payment of Special Taxes,are expected to occur in the Fiscal Year in which the tax will be collected; (iv) pay Administrative Expenses; and (v) pay the costs of public improvements and public infrastructure authorized to be financed by CFD No. 03-1. The amounts referred to in clauses(i)and(ii)of the preceding sentence may be reduced in any Fiscal Year by: (i) interest earnings on or surplus balances in funds and accounts for the Bonds to the extent that such earnings or balances are available to apply against debt service pursuant to a Bond indenture,Bond resolution,or other legal document that sets forth these terms;(ii)proceeds received by CFD No.03- 1 from the collection of penalties associated with delinquent Special Taxes; and (iii) any other revenues available to pay debt service on the Bonds as determined by the Administrator. "Taxable Other Property" means, in any Fiscal Year, all Assessor's Parcels of Other Property which had, in prior Fiscal Years,been: (i)developed and taxed as Single Family Detached Property or Single Family Attached Property, or (ii) designated in the Tentative Map as Single Family Detached Property or Single Family Attached Property and, when a change to the Expected Land Uses was proposed designating the Parcel as Other Property,no prepayment was received pursuant to Step 3.b in Section D below. "Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 03-1 which are not exempt from the Special Tax pursuant to law or Section G below. "Tax Zone"means one of the two mutually exclusive geographic areas defined below and identified in Attachment 2 of this Rate and Method of Apportionment of Special Tax,and any subsequent Tax Zones created to contain property annexed into the CFD after CFD Formation. TDPUD CFD No. 03-1 4 July 31,2003 - --. .. ...._... _....... ._.............. "Tax Zone#I"means the geographic area that is specifically identified in Attachment 2 of this Rate and Method of Apportionment of Special Tax as Tax Zone #1. "Tax Zone#2"means the geographic area that is specifically identified in Attachment 2 of this Rate and Method of Apportionment of Special Tax as Tax Zone#2. "TDPUD" means the Truckee Donner Public Utility District. "Tentative Map" means the Tentative Map and Conditional Use Permit for the Old Greenwood Planned Development, which was included as Exhibit D to the Development Agreement between East West Partners and the Town which was recorded at the County Recorder's Office on August 23, 2002. "Town" means the incorporated Town of Truckee. "Undeveloped Property" means, in any Fiscal Year, all Parcels of Taxable Property within the CFD that are not Developed Property. "Unit" means (i)for Single Family Detached Property, an individual single-family detached unit, and(ii)for Single Family Attached Property, an individual residential unit within a duplex,triplex, fourplex, townhome, or condominium structure. B. DATA FOR ANNUAL ADMINISTRATION On or about July I of each Fiscal Year,the Administrator shall identify the current Assessor's Parcel numbers for all Parcels of Taxable Property. The Administrator shall also determine: (i) whether each Assessor's Parcel of Taxable Property is Developed Property or Undeveloped Property,(ii)for Developed Property, which Parcels are Single Family Detached Property, Single Family Attached Property, and Taxable Other Property, (iii) for Parcels of Single Family Attached Property, the number of Units on each Parcel, (iv) whether there are Parcels of Rental Property, Excess Public Property or Parcels with Affordable Units, and (v) the Special Tax Requirement. For Single Family Attached Property, the number of Units shall be determined by referencing the site plan,condominium plan,or other development plan. If,in any Fiscal Year,an Assessor's Parcel includes both Developed Property and Undeveloped Property,the Administrator shall determine the Acreage associated with the Developed Property,subtract this Acreage from the total Acreage of the Assessor's Parcel, and use the remaining Acreage to calculate the Special Tax that will apply to Undeveloped Property within the Assessor's Parcel. In addition,the Administrator shall,on an ongoing basis,monitor whether changes in land use have been proposed that will affect the Expected Land Uses and whether Final Maps that have been proposed for approval by the Town are consistent with the Expected Land Uses. If changes to the Expected Land Uses are proposed, the Administrator shall apply the steps set forth in Section D below. TDPUD CFD No. 03-I 5 July 31,2003 C. MAXIMUM SPECIAL TAX 1. Single Family Detached Property The Maximum Special Tax for Single Family Detached Property in Zone I for Fiscal Year 2004-05 is $3,000 per SIT) Lot. The Maximum Special Tax for Single Family Detached Property in Zone 2 for Fiscal Year 2004-05 is$3,400 per SFD Lot. On July 1, 2005 and on each July 1 thereafter, these Maximum Special Tax rates shall be increased by an amount equal to two percent(2%)of the amount in effect for the prior Fiscal Year. 2. Single Family Attached Property The Maximum Special Tax for Single Family Attached Property in Zone 1 for Fiscal Year 2004-05 is $3,000 per Unit. The Maximum Special Tax for Single Family Attached Property in Zone 2 for Fiscal Year 2004-05 is $3,400 per Unit. On July 1, 2005 and on each July I thereafter, these Maximum Special Tax rates shall be increased by an amount equal to two percent(2%)of the amount in effect for the prior Fiscal Year. 3. Taxable Other Property The Maximum Special Tax for Taxable Other Property shall be the amount needed on a per-acre basis to maintain the Maximum Special Tax that was assigned to the Parcel prior to the Parcel becoming Taxable Other Property. After the Maximum Special Tax has been determined for a Parcel of Taxable Other Property,the Maximum Special Tax shall be increased each Fiscal Year thereafter by an amount equal to two percent(2%) of the amount in effect the prior Fiscal Year. 4. Undeveloped Property The Maximum Special Tax for Undeveloped Property for Fiscal Year 2004-05 is $11,325 per Acre. On July I, 2005 and on each July 1 thereafter, this Maximum Special Tax shall be increased by an amount equal to two percent(2%)of the amount in effect for the prior Fiscal Year. Pursuant to Section 53321 (d) of the Act, the Special Tax levied against a Parcel used for private residential purposes shall under no circumstances increase more than ten percent (10%) as a consequence of delinquency or default by the owner gfany other Parcel or Parcels and shall, in no event, exceed the Maximum Special Tax in effect for the Fiscal Year in which the Special Tax is being levied TDPUD CFD No. 03-I 6 July 31,2003 D. BACK-UP FORMULA The Maximum Special Taxes set forth in Section C above were calculated based on the Expected Land Uses at CFD Formation. The Administrator shall review Tentative Map revisions and other changes to the land uses proposed within the CFD and compare the revised land uses to the Expected Land Uses to evaluate the impact on the Expected Maximum Special Tax Revenues. In addition,the Administrator shall review Final Maps to ensure they reflect the number of residential lots that was anticipated in the Tentative Map. If,prior to the Final Bond,Sale, a change to the Expected Land Uses (a"Land Use/Entitlement Change') is proposed that will result in a reduction in the Expected Maximum Special Tax Revenues, no action will be needed pursuant to this Section D as long as the reduction in Expected Maximum Special Tax Revenues does not reduce debt service coverage on outstanding Bonds below the amount committed to in the Bond documents. Upon approval of the Land Use/Entitlement Change, the Administrator shall update Attachment 1 to show the reduced Expected Maximum Special Tax Revenues, and the reduced Expected Maximum Special Tax Revenues shall be the amount used to determine the amount of the Final Bond Sale. If a Land Use/Entitlement Change is proposed after the Final Bond Sale,the following steps shall be applied: Step 1: By reference to Attachment 1 (which will be updated by the Administrator each time a Land Use/Entitlement Change has been processed according to this Section D), the Administrator shall identify the Expected Maximum Special Tax Revenues for CFD No. 03-1; Step 2: The Administrator shall calculate the Maximum Special Tax revenues that could be collected from property in the CFD if the Land Use/Entitlement Change is approved; Step 3: If the amount determined in Step 2 is higher than that calculated in Step 1, the Land Use/Entitlement Change may be approved without further action. If the revenues calculated in Step 2 are less than those calculated in Step 1, and if: (a) The landowner does not withdraw the request for the Land Use/Entitlement Change that was submitted to the Town; or (b) Before approval of the Land Use/Entitlement Change,the landowner requesting the Land Use/Entitlement Change does not prepay a portion of the Special Tax for the CFD in an amount that corresponds to the lost Maximum Special Tax revenue,as determined by applying the steps set forth in Section H below; or (c) If the Land Use/Entitlement Change proposes that a Parcel of Single Family Detached Property or Single Family Attached Property be TDPUD CFD No. 03-1 7 July 31,2003 developed as another land use (other than Public Property), and the landowner requesting the Land Use/Entitlement Change fails to submit a written request to the TDPUD to designate the Parcel as Taxable Other Property,thereby maintaining the Expected Maximum Special Tax Revenues for the Parcel; then,the amount of the prepayment determined in Step 3.b shall be allocated on a per-acre basis and included on the next property tax bill for all Assessor's Parcels within the property affected by the Land Use/Entitlement Change. The amount allocated to each Assessor's Parcel shall be added to and, until paid, shall be a part of, the Maximum Special Tax for the Assessor's Parcel. If multiple Land Use/Entitlement Changes are proposed at one time(which may include approval of multiple Final Maps at one time),the Administrator may consider the combined effect of all the Land UselEntitlement Changes to determine if there is a reduction in Expected Maximum Special Tax Revenues that necessitates implementation of Step 3.b or 3.c. If, based on this comprehensive analysis, the Administrator determines that there is a reduction in Expected Maximum Special Tax Revenue, and all of the Land UselEntitlement Changes are being proposed by the same land owner,the Administrator shall determine the required prepayment(pursuant to Step 3.b) by analyzing the combined impact of all of the proposed Land Use/Entitlement Changes. Notwithstanding the foregoing, if the Administrator looks at the combined impacts of multiple Land Use/Entitlement Changes,and the Town subsequently does not approve one of the Land Use/Entitlement Changes that was proposed, the Administrator shall once again apply the three steps set forth above to determine the combine impact of those Land Use/Entitlement Changes that were approved simultaneously by the Town. If, based on the comprehensive analysis, the Administrator determines that there is a reduction in Expected Maximum Special Tax Revenue, and the Land UselEntitlement Changes are not all being proposed by the same land owner,the Administrator shall consider the proposed Land Use/Entitlement Changes individually to determine the required prepayment from each owner. E. METHOD OF LEVY OF THE SPECIAL TAX Each Fiscal Year,the Administrator shall determine the Special Tax Requirement to be collected in that Fiscal Year, and the Special Tax shall be levied according to the steps outlined below. Step 1: The Special Tax shall be levied Proportionately on each Parcel of Developed Property within the CFD up to 100%of the Maximum Special Tax for each Parcel for such Fiscal Year until the amount levied on Developed Property is TDPUD CPD No. 03-1 8 July 31,2003 equal to the Special Tax Requirement prior to applying any Capitalized Interest that is available in the CFD accounts. Step 2: If additional revenue is needed after Step 1, and after applying Capitalized Interest to the Special Tax Requirement, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property within the CFD, up to 100% of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C; Step 3: If additional revenue is needed after applying the first two steps,the Special Tax shall be levied Proportionately on each Parcel of Association Property within the CFD, up to 100%of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C; Step 4: If additional revenue is needed after applying the first three steps,the Special 'Fax shall be levied Proportionately on each Assessor's Parcel of Excess Public Property,exclusive of property exempt from the Special Tax pursuant to Section G below, up to 100% of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C. F. COLLECTION OF SPECIAL TAX The Special Taxes for CFD No. 03-1 shall be collected in the same manner and at the same time as ordinary ad valorem property taxes,provided,however,that prepayments are permitted as set forth in Section H below and provided further that the TDPUD may directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner,and may collect delinquent Special 'Faxes through foreclosure or other available methods. The Special Tax for Fractional Units may be billed either directly to individual fractional owners or to a homeowners association, which shall then bill the individual fractional owners;non-payment of Special Taxes billed by the homeowners association shall result in interest and penalties, and the fractional ownership shall be subject to foreclosure proceedings as set forth in the Bond covenants. The Special Tax shall be levied and collected until principal and interest on Bonds have been repaid, costs of constructing or acquiring authorized facilities from Special Tax proceeds have been paid, and all administrative expenses have been reimbursed. However, in no event shall a Special Tax be levied after Fiscal Year 2039-2040. G. EXEMPTIONS Notwithstanding any other provision of this Rate and Method of Apportionment of Special Tax,no Special Tax shall be levied on up to 30.31 Acres of Public Property. A separate amount of public acreage may be exempted each time property annexes into CFD No. 03-1, and such additional exemption shall only apply to property within the annexation area. A Special Tax may be levied on TDPUD CFD No. 03-1 9 July 31,2003 Excess Public Property pursuant to Step 4 of Section E;however, a public agency may require that the special tax obligation on land conveyed to it that would be classified as Excess Public Property be prepaid pursuant to Section H below. In addition,no Special Tax shall be levied in any Fiscal Year on(i)Golf Course Property,(ii)Rental Property,(iii)Affordable Units,or(iv)Other Property unless the Parcel is determined to be Taxable Other Property. H. PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section H: "Outstanding Bonds"means all Previously Issued Bonds which remain outstanding,with the following exception: if a Special Tax has been levied against, or already paid by, an Assessor's Parcel making a prepayment,and a portion of the Special Tax will be used to pay a portion of the next principal payment on the Bonds that remain outstanding(as determined by the Administrator), that next principal payment shall be subtracted from the total Bond principal that remains outstanding, and the difference shall be used as the amount of Outstanding Bonds for purposes of this prepayment formula. "Previously Issued Bonds" means all Bonds that have been issued on behalf of the CFD prior to the date of prepayment. "Public Facilities Requirements" means either $9,850,000 in 2003 dollars, which shall increase on January 1,2004,and on each January I thereafter by the percentage increase,if any, in the construction cost index for the San Francisco region for the prior twelve (12) month period as published in the Engineering News Record or other comparable source if the Engineering News Record is discontinued or otherwise not available, or such lower number as shall be determined by the TDPUD as sufficient to fund improvements that are authorized to be funded by the CFD. The Public Facilities Requirements shown above may be adjusted or a separate Public Facilities Requirements identified each time property annexes into CFD No.03-1;at no time shall the added Public Facilities Requirement for that annexation area exceed the amount of public improvement costs that are expected to be supportable by the Maximum Special "Fax revenues generated within that annexation area. "Remaining Facilities Costs"means the Public Facilities Requirements(as defined above), minus public facility costs funded by Outstanding Bonds (as defined above), developer equity, and/or any other source of funding. The Special Tax obligation applicable to an Assessor's Parcel in the CFD may be prepaid and the obligation of the Assessor's Parcel to pay the Special Tax 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 TDPUD with written notice of intent to prepay. Within 30 days of receipt of such written notice,the TDPUD or its designee shall notify such owner TDPUD CFD No. 03-1 10 July 31,2003 of the prepayment amount for such Assessor's Parcel. Prepayment must be made not less than 75 days prior to any redemption date for Bonds to be redeemed with the proceeds of such prepaid Special Taxes. The Prepayment Amount shall be calculated as follows: (capitalized terms as defined below): Bond Redemption Amount plus Remaining Facilities Amount plus Redemption Premium plus Defeasance Requirement plus Administrative Fees and Expenses less Reserve Fund Credit equals Prepayment Amount As of the proposed date of prepayment,the Prepayment Amount shall be determined by application of the following steps: Step 1. Compute the total Maximum Special Tax that could be collected from the Assessor's Parcel prepaying the Special Tax in the Fiscal Year in which prepayment would be received by the TDPUD or, in the event of a prepayment pursuant to Step 3.b in Section D,compute the amount by which the Maximum Special Tax revenues would be reduced by the Land Use/Entitlement Change and use the amount of this reduction as the figure for purposes of this Step 1. Step 2. Divide the Maximum Special Tax from Step I by the then-current Expected Maximum Special Tax Revenues for the CFD. Step 3. Multiply the quotient computed pursuant to Step 2 by the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid (the `Bond Redemption Amount'7). Step 4. Compute the current Remaining Facilities Costs (if any). Step 5. Multiply the quotient computed pursuant to Step 2 by the amount determined pursuant to Step 4 to compute the amount of Remaining Facilities Costs to be prepaid (the "Remaining Facilities Amount"). Step 6. Multiply the Bond Redemption Amount computed pursuant to Step 3 by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed (the "Redemption Premium'. Step 7. Compute the amount needed to pay interest on the Bond Redemption Amount starting with the first Bond interest payment date after which the prepayment has been received until the earliest redemption date for the Outstanding Bonds, which, depending on the Bond offering document, may be as early as the next interest payment date. TDPUD CFD No. 03-1 11 July 31,2003 Step 8: Compute the amount of interest the TDPUD reasonably expects to derive from reinvestment of the Bond Redemption Amount plus the Redemption Premium from the first Bond interest payment date after which the prepayment has been received until the redemption date for the Outstanding Bonds. Step 9: Take the amount computed pursuant to Step 7 and subtract the amount computed pursuant to Step 8 (the "Defeasance Requirement"). Step 10. Determine the costs of computing the prepayment amount, the costs of redeeming Bonds, and the costs of recording any notices to evidence the prepayment and the redemption(the "Administrative Fees and Expenses'. Step 11. If and to the extent so provided in the indenture pursuant to which the Outstanding Bonds to be redeemed were issued,a reserve fund credit shall be calculated as a reduction in the applicable reserve fund for the Outstanding Bonds to be redeemed pursuant to the prepayment (the "Reserve Fund Credit"). Step 12. The Special Tax prepayment is equal to the sum of the amounts computed pursuant to Steps 3, 5, 6, 9, and 10, less the amount computed pursuant to Step 11 (the "PrepaymentAmount'�. A partial prepayment may be made in an amount equal to any percentage of full prepayment desired by the party making a partial prepayment. The Maximum Special Tax that can be levied on an Assessor's Parcel after a partial prepayment is made is equal to the Maximum Special Tax that could have been levied prior to the prepayment, reduced by the percentage of a full prepayment that the partial prepayment represents, all as determined by or at the direction of the Administrator. I. INTERPRETATION OF SPECIAL TAX FORMULA The TDPUD reserves the right to make minor administrative and technical changes to this document that do not materially affect the rate and method of apportioning Special Taxes. In addition, the interpretation and application of any section of this document shall be left to the TDPUD's discretion. Interpretations may be made by the TDPUD by ordinance or resolution for purposes of clarifying any vagueness or ambiguity in this Rate and Method of Apportionment of Special Tax. TDPUD CFD No. 03-1 12 July 31,2003 ATTACHMENT 1 TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT No. 03-1 (OLD GREENWOOD) EXPECTED LAND USES AND EXPECTED MAXIMUM SPECIAL TAX REVENUES AT CFD FORMATION Total Expected Maximum Special Tax Maximum Number of Per Unit/Acre for Special Tax Expected Land Uses Expected Units/Acres Fiscal Year 2004-05 * Revenues Single Family Detached Property and Single Family 104 Units $3,000 per SFD Lot $312,000 Attached Property in Zone 1 Single Family Detached Property and Single Family 154 Units $3,400 per SFD Lot $523,600 Attached Property in Zone 2 Taxable Other Pro e 0 Acres N/A $0 Total Expected Maximum Special Tax Revenues $835,600 Figzoes are shown in fiscal year 2004-05 dollars and will escalate two percent (2%)per year thereafter. ATTACHMENT 2 TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT No. 03-1 (OLD GREENWOOD) IDENTIFICATION OF TAX ZONES IDENTIFICATION OF TAX ZONES FOR OLAKEAE " PROPOSED COMMUNITY FACILITIES DISTRICT NO.03-I,. O (OLD 6REENWOOD) TRUCKEE DONNER PUBLIC UTILITY DISTRICT COUNTY OF NEVADA STATE OF CALIFORNIA AF FILED IN THE OFFICE OF THE BOARD THIS DAY OF 2003 I HEREBY CERTIFY THAT THE WITHIN MAP SHOWING PROPOSED BOUNDARIES OF TRUCKEE DEARER PUBLIC UTILITY DISTRICT COMMUNITY FACILITES DISTRICT N0.SSI TOLD GREENWOOD)TRUCKEE DONNER PUBLIC UTILITY DISTRICT,COUNTY OF NEVADA,STATE OF CALWORNW,WAS APPROVED BY THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT AT A REGULAR MEETING THEREOF,HELD ON THE DAY OF ,_ .20W BY ITS RESOLUTION NG.__ TRUCKEE VICINITY MAP -. _.- T 5. P�(.� CLERK OF THE BOARD N TRUCKEE DONNER PUBLIC UTILITY DISTRICT FILED THIS DAY OF =U,AT THE HOUR OF O'CLOCK_M.IN BOOK OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AND AS INSTRUMENT NO. IN THE OFFICE OF THE COUNTY RECORDER IN THE COUNTY OF NEVADA,STATE OF CALIFORNIA. \� COUNTY RECORDER COUNTY EVA N OF DA STATE OF EN%RNIA LEGEND ZONE I s T / e� ZONE 2 SEALB v' PLANNING d ENGINEERING,INC. 190 LITTON DRIVE, SUITE 260. ORA55 VALLEY. CA 95945 ` 10800 OONNEP PA59 ROAD, SUITE 502 TRUCKEE, GA 8Fl6l SHEET IOFI h RESOLUTION NO. RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DECLARING ITS INTENTION TO ESTABLISH TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-2 (GRAY'S CROSSING) AND TO AUTHORIZE THE LEVY OF A SPECIAL TAX WITHIN SAID COMMUNITY FACILITIES DISTRICT WHEREAS, Truckee Land, LTC, the owner(the "Owner") of not less than 10 percent of the area of land depicted on the map of the proposed community facilities district referred to below on file with the District Clerk (the "Property"), has filed a written petition with the Truckee Donner Public Utility District (the "Public utility District") to establish Truckee Donner Public Utility District Community Facilities District No. 03-2 (Gray's Crossing) (the "Community Facilities District") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, commencing with Section 53311 of the Government Code of the Sate of California (the "Act") to finance (i) the cost of purchasing, constructing, expanding, improving or rehabilitating the facilities listed in Appendix A hereto, and all appurtenances and appurtenant work associated therewith (collectively the "Facilities") and (ii)the incidental expenses to be incurred in connection with financing the Facilities, including costs associated with the creation of the Community Facilities District and the issuance of bonds, the establishment and replenishment of bond reserve and special reserve funds (the "Incidental Expenses"); and WHEREAS, the petition submitted by the Owner complies with the requirements of Section 53319 of the Act; and WHEREAS, in connection herewith, this Board of Directors intends to approve an estimate of the costs of the Facilities and the Incidental Expenses for the Community Facilities District; and WHEREAS, subject to the satisfaction of all applicable requirements of law, it is the intention of this Board of Directors to finance the Facilities and to pay for the Incidental Expenses through the formation of the Community Facilities District and the levy of a special tax and the issuance of bonds, provided that the levy of the special tax and the issuance of the bonds are approved at an election to be held within the boundaries of the Community Facilities District; NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. The Community Facilities District is proposed to be established under the terms of the Act. It is further proposed that the boundaries of the Community Facilities District shall be as depicted on the map of the proposed Community Facilities District which is on file with the District Clerk (the "Clerk"). The Clerk is hereby directed to sign the original map of the Community Facilities District and record it with all proper endorsements thereon with the County Recorder of the 1 DOCSOCA984625v 1,22925.0009 County of Nevada within fifteen days after the adoption of this resolution, all as required by Section 3111 of the Streets and Highways Code of the State of California. Section 3. The name of the proposed Community Facilities District shall be "Truckee Donner Public Utility District Community Facilities District No. 03-2(Gray's Crossing)." Section 4. The Facilities proposed to be provided within the Community Facilities District are facilities, as defined in the Act, which the Public Utility District, the Truckee Sanitary District, the Town of Truckee, the California Department of Transportation or Sierra Pacific Power Company is authorized by law to provide or to construct, acquire, own and operate, as the case may be. This Board of Directors hereby fords and determines that the description of the Facilities herein is sufficiently informative to allow taxpayers within the proposed Community Facilities District to understand what the funds of the Community Facilities District may be used to pay for. The Incidental Expenses expected to be incurred include the cost of planning and designing the Facilities, the costs of forming the Community Facilities District and levying and collecting a special tax within the Community Facilities District, Section 5. Except where funds are otherwise available, it is the intention of this Board of Directors to levy annually in accordance with the procedures contained in the Act a special tax, secured by recordation of a continuing lien against all non-exempt real property in the Community Facilities District, sufficient to pay for: (i) the Facilities and Incidental Expenses and (it)the principal of and interest on and other periodic costs with respect to the bonds issued to finance the Facilities, including the establishment and replenishment of any reserve funds deemed necessary by the Community Facilities District and any remarketing, credit enhancement and liquidity facility fees (including such fees for instruments which serve as the basis of a reserve fund in lieu of cash) in connection with the bonds. The Facilities may be financed on a direct payment basis or through the issuance of the bonds. The rate, method of apportionment and manner of collection of the special tax are described in detail in Appendix B attached hereto and incorporated herein as though set forth at length (the "Rate and Method"). Appendix B allows each landowner and resident within the Community Facilities District to estimate the maximum amount that may be levied against each parcel. If special taxes of the Community Facilities District are levied against any parcel used for private residential purposes, (i) such tax shall not be levied or collected to pay for Facilities or Incidental Expenses after the 2044-2045 tax year and (ii)under no circumstances will such special tax be increased as a consequence of delinquency or default by the owner of any other parcel or parcels within the Community Facilities District by more than ten percent. This Board of Directors hereby determines the Rate and Method to be reasonable. The special tax is apportioned to each parcel on the basis of land use and, in some cases, area pursuant to Section 53325.3 of the Act, and such special tax is not on or based upon the value or ownership of real property. In the event that a portion of the property within the Community Facilities District shall become for any reason exempt, wholly or partially, from the levy of the special tax, this Board of Directors shall, on behalf of the Community Facilities District, cause the levy to be increased, subject to the limitation of the maximum special tax for a parcel as set forth in the Rate and Method, to the extent necessary upon the remaining property within the Community Facilities District which is not delinquent or exempt in order to yield the special tax revenues required for the purposes described in this Section 5. 2 DOCSOCA984625v 1 A22925,0009 Section 6. A public hearing (the "Hearing") on the establishment of the Community Facilities District and the proposed Rate and Method shall be held at 7:00 p.m., or as soon thereafter as practicable, on October 1, 2003, in the board room of this Board of Directors, 11570 Donner Pass Road, Truckee, California 96160. Should this Board of Directors determine to form the Community Facilities District, a special election will be held to authorize the levy of the special tax in accordance with the procedures contained in Government Code Section 53326. If held, the proposed voting procedure at the election will be a landowner vote with each landowner of record as of the close of the Hearing having one vote for each acre of land or portion thereof owned within the Community Facilities District. Ballots for the special election may be distributed by mail or by personal service. Section 7. At the time and place set forth above for the Hearing, any interested person, including all persons owning lands or registered to vote within the proposed Community Facilities District, may appear and be heard. Section 8. Each officer of the Public Utility District who is or will be responsible for providing the Facilities within the proposed Community Facilities District, if it is established, is hereby directed to study the proposed Community Facilities District and, at or before the time of the Hearing, file a report with this Board of Directors containing a brief description of the public facilities by type which will in his or her opinion be required to meet adequately the needs of the proposed Community Facilities District and an estimate of the cost of providing those public facilities and an estimate of the fair and reasonable cost of any Incidental Expenses to be incurred. Section 9. The Public Utility District may accept advances of funds or work-in-kind from any source, including, but not limited to, private persons or private entities, for any authorized purpose, including, but not limited to, paying any cost incurred by the Public Utility District in creating the Community Facilities District. The Public Utility District may enter into an agreement with the person or entity advancing the funds or work-in-kind, to repay all or a portion of the funds advanced, or to reimburse the person or entity for the value, or cost, whichever is less, of the work- in-kind, as determined by this Board of Directors, with or without interest. Section 10. The Clerk is hereby directed to publish a notice (the `Notice") of the Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation published in the area of the Community Facilities District. Such publication shall be completed at least seven days prior to the date of the Hearing. The Clerk is further directed to mail a copy of the Notice to each of the landowners and registered voters, if any, within the boundaries of the Community Facilities District at least 15 days prior to the Hearing. The Notice shall contain the text or a summary of this Resolution, the time and place of the Hearing, a statement that the testimony of all interested persons or taxpayers will be heard, a description of the protest rights of the registered voters and landowners in the proposed Community Facilities District and a description of the proposed voting procedure for the election required by the Act. Section 11. Except to the extent limited in any bond resolution or trust indenture related to the issuance of bonds, the Board of Directors hereby reserves to itself all rights and powers set forth in Section 53344.1 of the Act(relating to tenders in full or partial payment). Section 12. The Clerk is hereby authorized and directed to transmit copies of this Resolution to the Town Council of the Town of Truckee. 3 DOCSOC,984625v 1 A22925.0009 ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on August 6, 2003. TRUCKEE DONNER PUBLIC UTILITY DISTRICT President of the Board of Directors ATTEST: District Clerk 4 DOCSOC\98462v 1,22925A09 APPENDIX A LIST OF FACILITIES It is intended that the District will finance all or a portion of the costs of the following: 1. Acquisition or construction of the following public improvements: a. water distribution and supply and fire suppression facilities including: i. 24" water pipeline connecting Sanders Well to the Fiberboard under-crossing; ii. water source(well) development including surveys, design, drilling,pump installation, building construction and connection to water system; iii. water distribution system serving all residential and commercial properties within District; iv. all other water facilities required to service properties within District; b. electrical supply and distribution facilities including: i. electrical infrastructure installed for service to residential and commercial parcels within the boundaries of the District including design, conduit, trenching, transformers and installation of cabling; ii. electrical facilities fees; in. all other electrical facilities required to service properties within District; C. public roadways, roundabouts and other road improvements including but not limited to medians, curbs, gutters, sidewalks, traffic signals, street signage, street lighting, pavement striping and any associated landscaping and erosion control; d. public plazas, including non-conforming signage; e. public access parks and trails; f. sanitary sewer facilities; 1. sewer lift station including but not limited to wet wells,mechanical, electrical, pumping and building systems; it. onsite sanitary facilities connecting residential and commercial parcels to lift station: iii. all other sanitary facilities required to service residential and commercial parcels within the boundaries of the District; g. storm drains and flood control facilities including but not limited to v—ditches, culverts, and infiltration ponds; It. wetlands and mitigation associated with construction of any public facility; A-1 DOCS00984625v 1A22925.0009 i. natural gas, telephone, electric, and telecommunications facilities, including such facilities to be owned by shareholder owned utility companies regulated by the California Public Utilities Commission, and further including trenching and appurtenant work and improvements; j. relocation of any existing public improvements or utility improvements; k. any other public improvements identified in accordance with the Development Agreement between the Truckee Donner Public Utility District and Gray's Crossing, LLC pertaining to the Gray's Crossing development project; 2. Any soft cost associated with the design and construction of the above described improvements including but not limited to engineering, environmental review, inspection, surveying and staking, and environmental mitigation. A-2 DOCSOC,984625v 1122925D009 APPENDIX B TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-2 (GRAY'S CROSSING RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A Special Tax applicable to each Assessor's Parcel in the Truckee Donner Public Utility District Community Facilities District No. 03-2 (Gray's Crossing) [herein"CFD No. 03-2"] shall be levied and collected according to the tax liability determined by the Board of Directors or its designee, through the application of the appropriate amount or rate for Taxable Property, as described below. All of the property in CFD No. 03-2, unless exempted by law or by the provisions of Section G below, shall be taxed for the purposes, to the extent, and in the manner herein provided, including property subsequently annexed to the CFD unless a separate Rate and Method of Apportionment is adopted for the annexation area. 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 or other parcel map recorded with the County. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, (commencing with Section 53311), Division 2 of Title 5 of the California Government Code. "Administrative Expenses"means any or all of the following: the fees and expenses of any fiscal agent or trustee (including any fees or expenses of its counsel) employed in connection with any Bonds,and the expenses of the TDPUD carrying out its duties with respect to CFD No. 03-2 and the Bonds,including,but not limited to,levying and collecting the Special Tax,the fees and expenses of Legal counsel, charges levied by the County Auditor's Office, Tax Collector's Office, and/or Treasurer's Office,costs related to annexing property into the CFD,costs related to property owner inquiries regarding the Special Tax, amounts needed to pay rebate to the federal government with respect to the Bonds,costs associated with complying with any continuing disclosure requirements for the Bonds and the Special Tax, and all other costs and expenses of the TDPUD in any way related to the establishment or administration of the CFD. "Administrator"means the person or firm designated by the TDPUD to administer the Special Tax according to this Rate and Method of Apportionment of Special Tax. TDPUD CFD No. 03-2 1 July 31,2003 "Affordable Unit"means any Unit within CFD No. 03-2 which,in the sole discretion of the Town, is either deed-restricted to maintain the affordability of the Unit or is determined by the Administrator to have been planned, designed and/or built to be an affordable unit. "Assessor's Parcel"or"Parcel"means a lot or parcel shown on an Assessor's Parcel Map with an assigned Assessor's Parcel number. "Assessor's Parcel Map" means an official map of the County Assessor designating parcels by Assessor's Parcel number. "Association Property" means any property within the CFD that is owned by a homeowners association, excluding Association Property under the pad or footprint of a Unit. "Board of Directors" or`Board" means the Board of Directors of the TDPUD. "Bonds" means bonds or other debt(as defined in the Act), whether in one or more series, issued, insured or assumed by CFD No. 03-2 related to public infrastructure and/or improvements that are authorized to be funded by CFD No. 03-2. "Capitalized Interest"means funds in any capitalized interest account available to pay debt service on Bonds. "CFD Formation" means the date on which the Resolution of Formation to form CFD No. 03-2 was adopted by the Board of Directors. "County" means the County of Nevada. "Developed Property" means, in any Fiscal Year, the following: • for Single Family Detached Property,all parcels for which a Final Map was recorded prior to May 1 of the preceding Fiscal Year • for Single Family Attached Property and Rental Property, all parcels for which a building permit for new construction of a residential structure was issued prior to May 1 of the preceding Fiscal Year. "Excess Public Property"means the acres of Public Property that exceeds the acreage anticipated to be Public Property in the Tentative Map. In any Fiscal Year in which a Special Tax must be levied on Excess Public Property pursuant to Step 4 in Section E below, Excess Public Property shall be those Assessor's Parcel(s)that most recently became Public Property based on the dates on which Final Maps recorded creating such Public Property. "Expected Land Uses"means the total number of Units expected to be constructed within the CFD as determined from time to time by the Administrator after applying the steps in Section D below. At CFD Formation, the Expected Land Uses were those expected to be reflected in the Tentative Map. The Expected Land Uses at CFD Formation are summarized in Attachment 1 hereto: the TDPUD CFD No. 03-2 2 July 31,2003 Administrator shall update Attachment I each time a change occurs to the land use plans for property in the CFD. "Expected Maximum Special Tax Revenues"means the amount of annual revenue that would be available if the Maximum Special Tax was levied on the Expected Land Uses. The Expected Maximum Special Tax Revenues as of CFD Formation are shown in Attachment I of this Rate and Method of Apportionment of Special Tax. "Final Bond Sale" means the last series of Bonds that will be issued on behalf of CFD No. 03-2 (excluding any Bond refundings), as determined in the sole discretion of the TDPUD. "Final Map" means a final map, or portion thereof, recorded by the County pursuant to the Subdivision Map Act(California Government Code Section 66410 et seq.)that creates individual lots on which building permits for new construction may be issued without further subdivision and for which no further subdivision is anticipated pursuant to the Tentative Map. "Fiscal Year" means the period starting July I and ending on the following June 30. "Fractional Unit" means a single family detached unit or a single family attached unit for which multiple owners may each purchase a fractional share of ownership(also referred to as a timeshare unit by the California Department of Real Estate). "Golf Course Property" means any property within CFD No. 03-2 that is used as a golf course, including but not limited to,a driving range,clubhouse,parking,lodge,outbuildings,and other golf- related amenities. Golf Course Property shall also include any property within the CFD that is used for a swim, tennis, and/or fitness facility. "Loft Unit" means a residential Unit located above and attached to a commercial establishment, which shall not under any circumstance include a residential Unit within which the owner of such Unit operates an at-home business operation. "Maximum Special Tax" means the greatest amount of Special Tax that can be levied on an Assessor's Parcel in any Fiscal Year determined in accordance with Section C below, as may be adjusted pursuant to Step 3 in Section D below. "Other Property"means, in any Fiscal Year, all Parcels of Taxable Property which are not Single Family Detached Property or Single Family Attached Property. "Proportionately"means,for Developed Property,that the ratio of the actual Special Tax levied in any Fiscal Year to the Maximum Special Tax authorized to be levied in that Fiscal Year is equal for all Assessor's Parcels of Developed Property, and for Undeveloped Property that the ratio of the actual Special Tax to the Maximum Special Tax is equal for all Assessor's Parcels of Undeveloped Property. "Public Property"means any property within the boundaries of CFD No. 03-2 that is owned by the federal government, State of California, County, Town, TDPUD, or other public agency. TDPUD CFD No. 03-2 3 A41,31,2003 "Rental Property" means, in any Fiscal Year, all Parcels within the CFD for which a building permit was issued for construction of a residential structure with multiple Units that share common walls, all of which are offered or are expected to be offered for rent to the general public and/or employees. Fractional Units within the CFD shall at no time be categorized as Rental Property. "SFD Lot" means an individual residential lot,identified and numbered on a recorded Final Map, on which a building permit has been or is permitted to be issued for construction of a single family detached unit without further subdivision of the lot and for which no further subdivision of the lot is anticipated pursuant to the Tentative Map. "Single Family Attached Property"means, in any Fiscal Year,all Parcels of Developed Property for which a building permit was issued for construction of a residential structure consisting of two or more Units that share common walls and are offered or expected to be offered as for-sale units, including attached Fractional Units and such residential structures that meet that statutory definition of a condominium contained in Civil Code Section 1351. "Single Family Detached Property"means,in any Fiscal Year,all Parcels of Developed Property for which a building permit was issued or is permitted to be issued for construction of a Unit that does not share a common wall with another Unit, including detached Fractional Units. "Special Tax"means a Special Tax levied in any Fiscal Year to pay the Special Tax Requirement. "Special Tax Requirement" means the amount necessary in any Fiscal Year to: (i)pay principal and interest on Bonds which is due in the calendar year that begins in such Fiscal Year, (ii) create and/or replenish reserve funds for the Bonds;(iii)cure any delinquencies in the payment of principal or interest on Bonds which have occurred in the prior Fiscal Year or, based on existing delinquencies in the payment of Special Taxes,are expected to occur in the Fiscal Year in which the tax will be collected; (iv) pay Administrative Expenses; and (v) pay the costs of public improvements and public infrastructure authorized to be financed by CFD No. 03-2. The amounts referred to in clauses(i)and(ii)of the preceding sentence may be reduced in any Fiscal Year by: (i) interest earnings on or surplus balances in funds and accounts for the Bonds to the extent that such earnings or balances are available to apply against debt service pursuant to a Bond indenture,Bond resolution,or other legal document that sets forth these terms;(ii)proceeds received by CFD No.03- 2 from the collection of penalties associated with delinquent Special Taxes; and (iii) any other revenues available to pay debt service on the Bonds as determined by the Administrator. "Taxable Other Property" means, in any Fiscal Year, all Assessor's Parcels of Other Property which had,in prior Fiscal Years,been: (i)developed and taxed as Single Family Detached Property or Single Family Attached Property, or (ii) designated in the Tentative Map as Single Family Detached Property or Single Family Attached Property and, when a change to the Expected Land Uses was proposed designating the Parcel as Other Property,no prepayment was received pursuant to Step 3.b in Section D below. "Taxable Property" means all of the Assessor's Parcels within the boundaries of CFD No. 03-2 which are not exempt from the Special Tax pursuant to law or Section G below. TDPUD CFD No. 03-2 4 July 31,2003 "TDPUD"means the Truckee Donner Public Utility District. "Tentative Map"means the tentative map for the Gray's Crossing Planned Development submitted to the Town for approval prior to issuance of the first series of Bonds for CFD No. 03-2. "Town" means the incorporated Town of Truckee. "Undeveloped Property" means, in any Fiscal Year, all Parcels of Taxable Property within the CFD that are not Developed Property. "Unit" means (i) for Single Family Detached Property, an individual single-family detached unit, and(ii)for Single Family Attached Property,an individual residential unit within a duplex,triplex, fourplex, townhome, or condominium structure. B. DATA FOR ANNUAL ADMINISTRATION On or about July 1 of each Fiscal Year,the Administrator shall identify the current Assessor's Parcel numbers for all Parcels of Taxable Property. The Administrator shall also determine: (i) whether each Assessor's Parcel of Taxable Property is Developed Property or Undeveloped Property,(ii)for Developed Property, which Parcels are Single Family Detached Property, Single Family Attached Property, and Taxable Other Property, (iii) for Parcels of Single Family Attached Property, the number of Units on each Parcel, (iv) whether there are Parcels of Rental Property, Excess Public Property, or Parcels with Affordable Units, and (v) the Special Tax Requirement. For Single Family Attached Property, the number of Units shall be determined by referencing the site plan,condominium plan,or other development plan. If,in any Fiscal Year,an Assessor's Parcel includes both Developed Property and Undeveloped Property,the Administrator shall determine the Acreage associated with the Developed Property,subtract this Acreage from the total Acreage of the Assessor's Parcel, and use the remaining Acreage to calculate the Special Tax that will apply to Undeveloped Property within the Assessor's Parcel. In addition,the Administrator shall,on an ongoing hasis,monitor whether changes in land use have been proposed that will affect the Expected Land Uses and whether Final Maps that have been proposed for approval by the Town are consistent with the Expected Land Uses. If changes to the Expected Land Uses are proposed, the Administrator shall apply the steps set forth in Section D below. C. MAXIMUM SPECIAL TAX 1. Single Family Detached Property The Maximum Special Tax for Single Family Detached Property for Fiscal Year 2004-05 is $3,000 per Unit for SIT) Lots greater than 5,000 square feet, and $1,500 per Unit for SIT) TDPUD CFD No. 03-2 5 July 31,2003 Lots less than or equal to 5,000 square feet. The square footage of SFD Lots shall be determined by reference to County Assessor's Parcel Maps or, to the extent such Maps do not reflect square footage of the SIT)Lots,by reference to the lot size summary provided by the engineering firm that produced the Final Map. On July 1, 2005 and on each July 1 thereafter,this Maximum Special Tax shall be increased by an amount equal to two percent (2%) of the amount in effect for the prior Fiscal Year. 2. Single Family Attached Property The Maximum Special Tax for Single Family Attached Property for Fiscal Year 2004- 05 is $2,500 per Unit. On July 1, 2005 and on each July 1 thereafter, this Maximum Special Tax shall be increased by an amount equal to two percent(2%)of the amount in effect for the prior Fiscal Year. 3. Taxable Other Property The Maximum Special Tax for Taxable Other Property shall be the amount needed on a per-acre basis to maintain the Maximum Special Tax that was assigned to the Parcel prior to the Parcel becoming Taxable Other Property. After the Maximum Special Tax has been determined for a Parcel of Taxable Other Property,the Maximum Special Tax shall be increased each Fiscal Year thereafter by an amount equal to two percent(2%) of the amount in effect the prior Fiscal Year. 4. Undeveloped Property The Maximum Special Tax for Undeveloped Property for Fiscal Year 2004-05 is $17,500 per Acre. On July 1, 2005 and on each July 1 thereafter, this Maximum Special Tax shall be increased by an amount equal to two percent(2%)of the amount in effect for the prior Fiscal Year. Pursuant to Section 53321 (d) of the Act, the Special Tax levied against a Parcel used for private residential purposes shall under no circumstances increase more than ten percent (10%) as a consequence of delinquency or defbult by the owner of any other Parcel or Parcels and shall, in no event, exceed the Maximum Special Tax in effect for the Fiscal Year in which the Special Tax is being levied. D. BACK-UP FORMULA The Maximum Special Taxes set forth in Section C above were calculated based on the Expected Land Uses at CFD Formation. The Administrator shall review Tentative Map revisions and other changes to the land uses within the CFD and compare the revised land uses to the Expected Land Uses to evaluate the impact on the Expected Maximum Special Tax Revenues. In addition, the Administrator shall review Final Maps to ensure they reflect the number of residential Lots that was anticipated in the Tentative Map. TDPUD CFD No. 03-2 6 July 31,2003 If,prior to lite Final Bony!Sale, a change to the Expected Land Uses (a "Land Use/Entitlement Change") is proposed that will result in a reduction in the Expected Maximum Special Tax Revenues,no action will be needed pursuant to this Section D as long as the reduction in Expected Maximum Special Tax Revenues does not reduce debt service coverage on outstanding Bonds below the amount committed to in the Bond documents. Upon approval of the(a "Land Use/Entitlement Change"), the Administrator shall update Attachment I to show the reduced Expected Maximum Special Tax Revenues, and the reduced Expected Maximum Special Tax Revenues shall be the amount used to determine the amount of the Final Bond Sale. If a Land Use/Entitlement Change is proposed after the Final Bond Sale,the following steps shall be applied: Step 1: By reference to Attachment I (which will be updated by the Administrator each time a Land Use/Entitlement Change has been processed according to this Section D), the Administrator shall identify the Expected Maximum Special Tax Revenues for CFD No. 03-2; Step 2: The Administrator shall calculate the Maximum Special Tax revenues that could be collected from property in the CFD if the Land Use/Entitlement Change is approved; Step 3: If the amount determined in Step 2 is higher than that calculated in Step 1, the Land Use/Entitlement Change may be approved without further action. If the revenues calculated in Step 2 are less than those calculated in Step 1, and if: (a) The landowner does not withdraw the request for the Land Use/Entitlement Change that was submitted to the Town; or (b) Before approval of the Land Use/Entitlement Change,the landowner requesting the Land Use/Entitlement Change does not prepay a portion of the Special Tax for the CFD in an amount that corresponds to the lost Maximum Special Tax revenue,as determined by applying the steps set forth in Section H below; or (c) If the Land Use/Entitlement Change proposes that a Parcel of Single Family Detached Property or Single Family Attached Property be developed as another land use (other than Public Property), and the landowner requesting the Land Use/Entitlement Change fails to submit a written request to the TDPUD to designate the Parcel as Taxable Other Property,thereby maintaining the Expected Maximum Special Tax Revenues for the Parcel; then,the amount of the prepayment determined in Step 3.b shall be allocated on a per-acre basis and included on the next property tax bill for all Assessor's Parcels within the property affected by the Land Use/Entitlement TDPUD CFD No. 03-2 7 July 31,2003 Change. The amount allocated to each Assessor's Parcel shall be added to and, until paid, shall be a part of, the Maximum Special Tax for the Assessor's Parcel. If multiple Land Use/Entitlement Changes are proposed at one time(which may include approval of multiple Final Maps at one time),the Administrator may consider the combined effect of all the Land Use/Entitlement Changes to determine if there is a reduction in Expected Maximum Special Tax Revenues that necessitates implementation of Step 3.b or 3.c. If, based on this comprehensive analysis, the Administrator determines that there is a reduction in Expected Maximum Special Tax Revenue, and all of the Land Use/Entitlement Changes are being proposed by the same land owner, the Administrator shall determine the required prepayment(pursuant to Step 3.b) by analyzing the combined impact of all of the proposed Land Use/Entitlement Changes. Notwithstanding the foregoing, if the Administrator looks at the combined impacts of multiple Land Use/Entitlement Changes,and the Town subsequently does not approve one of the Land Use/Entitlement Changes that was proposed, the Administrator shall once again apply the three steps set forth above to determine the combine impact of those Land Use/Entitlement Changes that were approved simultaneously by the Town. If, based on the comprehensive analysis, the Administrator determines that there is a reduction in Expected Maximum Special Tax Revenue, and the Land Use/Entitlement Changes are not all being proposed by the same land owner, the Administrator shall consider the proposed Land Use/Entitlement Changes individually to determine the required prepayment from each owner. E. METHOD OF LEVY OF THE SPECIAL TAX Each Fiscal Year,the Administrator shall determine the Special Tax Requirement to be collected in that Fiscal Year, and the Special Tax shall be levied according to the steps outlined below. Step 1: The Special Tax shall be levied Proportionately on each Parcel of Developed Property within the CFD up to 100%of the Maximum Special Tax for each Parcel for such Fiscal Year until the amount levied on Developed Property is equal to the Special Tax Requirement prior to applying any Capitalized Interest that is available in the CFD accounts. Step 2: If additional revenue is needed after Step 1, and after applying Capitalized Interest to the Special Tax Requirement, the Special Tax shall be levied Proportionately on each Assessor's Parcel of Undeveloped Property within the CFD, up to 100% of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C; TDPCD CFD No. 03-2 8 July 31,2003 Step 3: If additional revenue is needed after applying the first two steps,the Special Tax shall be levied Proportionately on each Parcel of Association Property within the CFD,up to 100% of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C; Step 4: If additional revenue is needed after applying the first three steps,the Special Tax shall be levied Proportionately on each Assessor's Parcel of Excess Public Property,exclusive of property exempt from the Special Tax pursuant to Section G below, up to 100% of the Maximum Special Tax for Undeveloped Property for such Fiscal Year determined pursuant to Section C. F. COLLECTION OF SPECIAL TAX The Special Taxes for CFD No. 03-2 shall be collected in the same manner and at the same time as ordinary ad valorem property taxes,provided,however,that prepayments are permitted as set forth in Section H below and provided further that the TDPUD may directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner,and may collect delinquent Special Taxes through foreclosure or other available methods. The Special Tax for Fractional Units maybe billed either directly to individual fractional owners or to a homeowners association, which shall then bill the individual fractional owners; non-payment of Special Taxes billed by the homeowners association shall result in interest and penalties, and the fractional ownership shall be subject to foreclosure proceedings as set forth in the Bond covenants. The Special Tax shall be levied and collected until principal and interest on Bonds have been repaid, costs of constructing or acquiring authorized facilities from Special Tax proceeds have been paid, and all administrative expenses have been reimbursed. However,in no event shall a Special Tax be levied after Fiscal Year 2043-44. G. EXEMPTIONS Notwithstanding any other provision of this Rate and Method of Apportionment of Special Tax,no Special Tax shall be levied on Public Property up to the amount of acreage designated as Public Property in the Tentative Map. A separate amount of public acreage may be exempted each time property annexes into CFD No. 03-2, and such additional exemption shall only apply to property within the annexation area. A Special Tax may be levied on Excess Public Property pursuant to Step 4 of Section E; however, a public agency may require that the special tax obligation on land conveyed to it that would be classified as Excess Public Property be prepaid pursuant to Section H below. In addition,no Special Tax shall be levied in any Fiscal Year on(i)Golf Course Property,(ii)Rental Property,(iii)Affordable Units,or(iv)Other Property unless the Parcel is determined to be Taxable Other Property. TDPUD CFD No. 03-2 9 July 31,2003 H. PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section FI: "Outstanding Bonds" means all Previously Issued Bonds which remain outstanding,with the following exception: if a Special Tax has been levied against, or already paid by, an Assessor's Parcel making a prepayment,and a portion of the Special Tax will be used to pay a portion of the next principal payment on the Bonds that remain outstanding(as determined by the Administrator), that next principal payment shall be subtracted from the total Bond principal that remains outstanding, and the difference shall be used as the amount of Outstanding Bonds for purposes of this prepayment formula. "Previously Issued Bonds" means all Bonds that have been issued on behalf of the CFD prior to the date of prepayment. "Public Facilities Requirements" means either $16,350,000 in 2003 dollars, which shall increase on January I,2004,and on each January I thereafter by the percentage increase,if any, in the construction cost index for the San Francisco region for the prior twelve (12) month period as published in the Engineering News Record or other comparable source if the Envineerina News Record is discontinued or otherwise not available, or such other number as shall be determined by the TDPUD as sufficient to fund improvements that are authorized to be funded by the CFD. The Public Facilities Requirements shown above may be adjusted or a separate Public Facilities Requirements identified each time property annexes into CFD No.03-2;at no time shall the added Public Facilities Requirement for that annexation area exceed the amount of public improvement costs that are expected to be supportable by the Maximum Special Tax revenues generated within that annexation area. In addition, the Public Facilities Requirement may be adjusted if the total number of Units authorized to be constructed within the CFD is increased by the Town;this adjustment to the Public Facilities Requirement shall not exceed the amount of public improvement costs that are expected to be supportable by the Maximum Special Tax revenues generated by the additional number of Units approved by the Town. "Remaining Facilities Costs"means the Public Facilities Requirements(as defined above), minus public facility costs funded by Outstanding Bonds (as defined above), developer equity, and/or any other source of funding. The Special Tax obligation applicable to an Assessor's Parcel in the CFD may be prepaid and the obligation of the Assessor's Parcel to pay the Special Tax 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 TDPUD with written notice of intent to prepay. Within 30 days of receipt of such written notice,the TDPUD or its designee shall notify such owner of the prepayment amount for such Assessor's Parcel. Prepayment must be made not less than 75 days prior to any redemption date for Bonds to be redeemed with the proceeds of such prepaid Special Taxes. The Prepayment Amount shall be calculated as follows: (capitalized terms as defined below): TDPUD CFD No. 03-2 10 July 31,2003 Bond Redemption Amount plus Remaining Facilities Amount phis Redemption Premium plus Defeasance Requirement plus Administrative Fees and Expenses less Reserve Fund Credit equals Prepayment Amount As of the proposed date of prepayment,the Prepayment Amount shall be determined by application of the following steps: Step 1. Compute the total Maximum Special Tax that could be collected from the Assessor's Parcel prepaying the Special Tax in the Fiscal Year in which prepayment would be received by the TDPUD or, in the event of a prepayment pursuant to Step 3.b in Section D,compute the amount by which the Maximum Special Tax revenues would be reduced by the Land Use/Entitlement Change and use the amount of this reduction as the figure for purposes of this Step 1. Step 2. Divide the Maximum Special Tax from Step I by the then-current Expected Maximum Special Tax Revenues for the CFD. Step 3. Multiply the quotient computed pursuant to Step 2 by the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid(the "Bond Redemption Amount'. Step 4. Compute the current Remaining Facilities Costs (if any). Step 5. Multiply the quotient computed pursuant to Step 2 by the amount determined pursuant to Step 4 to compute the amount of Remaining Facilities Costs to be prepaid(the "Remaining Facilities Amount'). Step 6. Multiply the Bond Redemption Amount computed pursuant to Step 3 by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed (the "Redemption Premium'). Step 7. Compute the amount needed to pay interest on the Bond Redemption Amount starting with the first Bond interest payment date after which the prepayment has been received until the earliest redemption date for the Outstanding Bonds,which,depending on the Bond offering document, may be as early as the next interest payment date. Step 8: Compute the amount of interest the TDPUD reasonably expects to derive from reinvestment of the Bond Redemption Amount plus the Redemption Premium from the first Bond interest payment date after which the TDPUD CFD No. 03-2 11 July 31,20o3 prepayment has been received until the redemption date for the Outstanding Bonds. Step 9: Take the amount computed pursuant to Step 7 and subtract the amount computed pursuant to Step 8 (the "Defeasanee Requirement"). Step 10. Determine the costs of computing the prepayment amount, the costs of redeeming Bonds, and the costs of recording any notices to evidence the prepayment and the redemption(the "Administrative Fees and Expenses'. Step 11. If and to the extent so provided in the indenture pursuant to which the Outstanding Bonds to be redeemed were issued,a reserve fund credit shall be calculated as a reduction in the applicable reserve fund for the Outstanding Bonds to be redeemed pursuant to the prepayment (the "Reserve Fund Credit'). Step 12. The Special Tax prepayment is equal to the sum of the amounts computed pursuant to Steps 3, 5, 6, 9, and 10, less the amount computed pursuant to Step I (the "Prepayment Amount"). A partial prepayment may be made in an amount equal to any percentage of full prepayment desired by the party making a partial prepayment. The Maximum Special Tax that can be levied on an Assessor's Parcel after apartial prepayment is made is equal to the Maximum Special Tax that could have been levied prior to the prepayment, reduced by the percentage of a full prepayment that the partial prepayment represents, all as determined by or at the direction of the Administrator. I. INTERPRETATION OF SPECIAL TAX FORMULA The TDPUD reserves the right to make minor administrative and technical changes to this document that do not materially affect the rate and method of apportioning Special Taxes. In addition, the interpretation and application of any section of this document shall be left to the TDPUD's discretion. Interpretations may be made by the TDPUD by ordinance or resolution for purposes of clarifying any vagueness or ambiguity in this Rate and Method of Apportionment of Special Tax. TDPUD CFD No. 03-2 12 July 31,2003 ATTACHMENT TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT No. 03-2 (GRAY'S CROSSING) EXPECTED LAND USES AND EXPECTED MAXIMUM SPECIAL TAX REVENUES AT CFD FORMATION Total Expected Maximum Special Taxi Maximum Number of Per Unit/Acre for Special Tax Expected Land Uses Expected Units/Acres Fiscal Year 2004-05 * ! Revenues Single Family Detached Property on 410 Units $3,000 per SFD Lot $1,230,000 Lots Greater Than 5,000 Square Feet Single Family Detached Property on 57 Units $1,500 per SFD Lot $85,500 Lots Less Than or Equal to 5,000 Square Feet Single Family 33 Units $2,500 per Unit $82,500 Attached Property Taxable Other 0 Acres N/A $0 Property j i Total Expected Maximum Special Tax Revenues $1,398,000 *Figures are shown in fiscal year 2004-05 dollars and will escalate two percent (2%)per year thereafter. RESOLUTION NO. RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DECLARING ITS INTENTION TO INCUR BONDED INDEBTEDNESS IN THE AMOUNT NOT TO EXCEED S15,000,000 WITHIN PROPOSED TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-1 (OLD GREENWOOD) WHEREAS, pursuant to a resolution adopted on the date hereof (the "Companion Resolution"), this Board of Directors has instituted proceedings to form Truckee Donner Public Utility District Community Facilities District No. 03-1 (Old Greenwood) (the "Community Facilities District') pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "Act') in order to finance (i)the cost of purchasing, constructing, expanding, improving or rehabilitating the facilities listed on Appendix A to the Companion Resolution, and all appurtenances and appurtenant work associated with the foregoing (collectively the "Facilities") and (ii) the incidental expenses to be incurred in connection with financing the Facilities, including costs associated with the creation of the Community Facilities District and the issuance of bonds, the establishment and replenishment of bond reserve and special reserve funds (the"Incidental Expenses"); and WHEREAS, this Board of Directors estimates that the amount required to finance the Facilities and Incidental Expenses is approximately $15,000,000; and WHEREAS, in order to finance the Facilities and Incidental Expenses, subject to the satisfaction of all applicable requirements of law, this Board of Directors intends to authorize the issuance of bonds in the maximum aggregate principal amount of $15,000,000, the repayment of which is to be secured by special taxes levied in accordance with the Act on all property in the Community Facilities District, other than those properties exempted from taxation in the rate and method of apportionment set forth in Appendix C to the Companion Resolution; NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. It is necessary to incur bonded indebtedness within the boundaries of the Community Facilities District in an amount not to exceed $15,000,000 to finance certain of the costs of the Facilities and Incidental Expenses, as permitted by the Act Section 3. The indebtedness will be incurred for the purpose of financing the costs of the Facilities and the Incidental Expenses, including, but not limited to, the funding of reserve funds for the bonds, the financing of costs associated with the issuance of the bonds and all other costs and expenses necessary to finance the Facilities which are permitted to be financed pursuant to the Act. Section 4. It is the intent of this Board of Directors to authorize the sale of bonds in one or more series, in the maximum aggregate principal amount specified in Section 2, and at a maximum interest rate not in excess of 12 percent per annum, or a higher rate not in excess of the DOCSOCA978690v3Q2925.0009 maximum rate permitted by law at the time that the bonds are issued. The term of the bonds of each series shall be determined pursuant to a resolution of this Board of Directors authorizing the issuance of the bonds of such series, but such term shall in no event exceed 40 years from the date of issuance of the bonds of such series, or such longer term as is then permitted by law. Section 5. A public hearing (the "Hearing") on the proposed debt issue shall be held at 7:00 p.m., or as soon thereafter as practicable, on October 1, 2003, in the board room of this Board of Directors, 11570 Donner Pass Road, Truckee, California 96160. Section 6. At the time and place set forth in this Resolution for the Hearing, any interested persons, including all persons owning land or registered to vote within the Community Facilities District, may appear and be heard. Section 7. The Clerk of the Truckee Donner Public Utility District is hereby directed to publish a notice (the"Notice") of the Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation published in the area of the Community Facilities District. Such publication shall be completed at least seven days prior to the date of the Hearing. ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on August 6, 2003. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: President of the Board of Directors ATTEST: District Clerk DOCSOCV97809003 22925.0009 i RESOLUTION NO. RESOLUTION OF THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DECLARING ITS INTENTION TO INCUR BONDED INDEBTEDNESS IN THE AMOUNT NOT TO EXCEED S30,000,000 WITHIN PROPOSED TRUCKEE DONNER PUBLIC UTILITY DISTRICT COMMUNITY FACILITIES DISTRICT NO. 03-2 (GRAY'S CROSSING) WHEREAS, pursuant to a resolution adopted on the date hereof (the "Companion Resolution"), this Board of Directors has instituted proceedings to form Truckee Donner Public Utility District Community Facilities District No. 03-2 (Gray's Crossing) (the "Community Facilities District") pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (the "Act") in order to finance (i)the cost of purchasing, constructing, expanding, improving or rehabilitating the facilities listed on Appendix A to the Companion Resolution, and all appurtenances and appurtenant work associated with the foregoing (collectively the "Facilities") and (it) the incidental expenses to be incurred in connection with financing the Facilities, including costs associated with the creation of the Community Facilities District and the issuance of bonds, the establishment and replenishment of bond reserve and special reserve funds (the "Incidental Expenses"); and WHEREAS, this Board of Directors estimates that the amount required to finance the Facilities and Incidental Expenses is approximately $30,000,000; and WHEREAS, in order to finance the Facilities and Incidental Expenses, subject to the satisfaction of all applicable requirements of law, this Board of Directors intends to authorize the issuance of bonds in the maximum aggregate principal amount of $30,000,000, the repayment of which is to be secured by special taxes levied in accordance with the Act on all property in the Community Facilities District, other than those properties exempted from taxation in the rate and method of apportionment set forth in Appendix C to the Companion Resolution; NOW, THEREFORE, THE BOARD OF DIRECTORS OF THE TRUCKEE DONNER PUBLIC UTILITY DISTRICT DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. The above recitals are true and correct. Section 2. It is necessary to incur bonded indebtedness within the boundaries of the Community Facilities District in an amount not to exceed $30,000,000 to finance certain of the costs of the Facilities and Incidental Expenses, as permitted by the Act. Section 3. The indebtedness will be incurred for the purpose of financing the costs of the Facilities and the Incidental Expenses, including, but not limited to, the funding of reserve funds for the bonds, the financing of costs associated with the issuance of the bonds and all other costs and expenses necessary to finance the Facilities which are permitted to be financed pursuant to the Act. Section 4. It is the intent of this Board of Directors to authorize the sale of bonds in one or more series, in the maximum aggregate principal amount specified in Section 2, and at a maximum interest rate not in excess of 12 percent per annum, or a higher rate not in excess of the I X)CSOCA984023v 1,22925.0009 maximum rate permitted by law at the time that the bonds are issued. The term of the bonds of each series shall be determined pursuant to a resolution of this Board of Directors authorizing the issuance of the bonds of such series, but such term shall in no event exceed 40 years from the date of issuance of the bonds of such series, or such longer term as is then permitted by law. Section 5. A public hearing (the "Hearing") on the proposed debt issue shall be held at 7:00 p.m., or as soon thereafter as practicable, on October 1, 2003, in the board room of this Board of Directors, 11570 Donner Pass Road, Truckee, California 96160. Section 6. At the time and place set forth in this Resolution for the Hearing, any interested persons, including all persons owning land or registered to vote within the Community Facilities District, may appear and be heard. Section 7. The Clerk of the Truckee Donner Public Utility District is hereby directed to publish a notice (the"Notice") of the Hearing pursuant to Section 6061 of the Government Code in a newspaper of general circulation published in the area of the Community Facilities District. Such publication shall be completed at least seven days prior to the date of the Hearing. ADOPTED and APPROVED by the Board of Directors of the Truckee Donner Public Utility District on August 6, 2003. TRUCKEE DONNER PUBLIC UTILITY DISTRICT By: President of the Board of Directors ATTEST: District Clerk DOCSOCi994623v 1A22925.0009