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HomeMy WebLinkAbout03-16 TPFA ResolutionRESOLUTION NO. TPFA 03-16 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY DECLARING ITS INTENTION TO ESTABLISH A COMMUNITY FACILITIES DISTRICT AND TO AUTHORIZE THE LEVY OF SPECIAL TAXES THEREIN - WOLF CREEK 03-03 WHEREAS, under the Mello-Roos Community Facilities Act of 1982, constituting Section 53311 et seq. of the California Government Code (the "Law"), this Board of Directors may commence proceedings for the establishment of a community facilities district; and WHEREAS, there has been submitted to this Board of Directors a Petition (Including Waiver) of S-P Murdy, LLC (the "Petition"), requesting the formation by this Board of Directors of a community facilities district under the Law to be known as the Temecula Public Financing Authority Community Facilities District No. 03-03 (Wolf Creek) (the "District"); and WHEREAS, under the Law, this Board of Directors is the legislative body for the proposed District and is empowered with the authority to establish the District and levy special taxes within the District; and WHEREAS, this Board of Directors now desires to proceed with the actions necessary to consider the establishment of the District. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: Section 1. This Board of Directors proposes to begin the proceedings necessary to establish the District pursuant to the Law. Receipt of the Petition to form the District is hereby acknowledged. Section 2. The name proposed for the District is Temecula Public Financing Authority Community Facilities District No. 03-03 (Wolf Creek). Section 3. The proposed boundaries of the District are as shown on the map of the District on file with the Secretary, which boundaries are hereby preliminarily approved. The Secretary is hereby directed to record, or cause to be recorded, the map of the boundaries of the District in the office of the County Recorder as soon as practicable after the adoption of this Resolution. Section 4. The types of public facilities (the "Facilities") and the maintenance services (the "Services") proposed to be eligible for funding by the District and pursuant to the Law, and the fixed special assessment lien to be eliminated in whole or in part by payments from the District and pursuant to the Law, shall consist of those items listed on Exhibit A hereto under the headings "Facilities," "Services" and "Prior Lien," respectively, which Exhibit is by this reference incorporated herein. The Executive Director is hereby authorized and directed to enter into a joint community facilities agreement with the City of Temecula, with the Riverside County Flood Control and Water Conservation District, with the Temecula Community Services District, with the Eastern R:,"I'PFA Resos 2003/TPFA 03-16 1 Municipal Water District, and with any other public entity that will own and/or operate any of the Facilities or provide such Services, such agreements to be in a form provided by Bond Counsel. Section 5. Except to the extent that funds are otherwise available to the District to pay for the Facilities, the Services, and the elimination of the Prior Lien and/or pay the principal and interest as it becomes due on bonds of the District issued to pay for the Facilities, the Services, and the elimination of the Prior Lien, a special tax sufficient to pay the costs thereof, secured by recordation of a continuing lien against all non-exempt real property in the District, will be levied within the District and collected in the same manner as ordinary ad valorem property taxes or in such other manner as this Board of Directors or its designee shall determine, including direct billing of the affected property owners. The proposed rate and method of apportionment of the special tax among the parcels of real property within the District, in sufficient detail to allow each landowner within the proposed District to estimate the maximum amount such owner will have to pay, and which specifies the tax year after which no further special tax will be levied on land used for private residential purposes and which otherwise complies with applicable provisions of the Law is described in Exhibit B attached hereto which Exhibit is by this reference incorporated herein. This Board of Directors finds that the provisions of Section 53313.6, 53313.7 and 53313.9 of the California Government Code (relating to adjustments to ad valorem property taxes and schools financed by a community facilities district) are inapplicable to the District. Section 6. It is the intention of this Board of Directors, acting as the legislative body for the District, to cause bonds of the Authority to be issued for the District pursuant to the Law to finance a portion of the costs of the Facilities and the Services, and to finance the elimination of the Prior Lien. If so issued, the bonds shall be in the aggregate principal amount of not to exceed $33,000,000, shall bear interest payable semi-annually or in such other manner as this Board of Directors shall determine, at a rate not to exceed the maximum rate of interest as may be authorized by applicable law at the time of sale of such bonds, and shall mature not to exceed 40 years from the date of the issuance thereof. Section 7. This Board of Directors reserves to itself the right and authority to allow any interested owner of property in the District, subject to the provisions of Section 53344.1 of the California Government Code and such requirements as it may otherwise impose, and any applicable prepayment penalties as prescribed in the indenture or fiscal agent agreement for any bonds of the Authority for the District, to tender to the Treasurer of the Authority in full payment or part payment of any installment of special taxes or the interest or penalties thereon which may be due or delinquent, but for which a bill has been received, any bond or other obligation secured thereby, in the manner described in Section 53344.1 of the California Government Code. Section 8. The levy of said proposed special tax shall be subject to the approval of the qualified electors of the District at a special election. The proposed voting procedure shall be by mailed or hand-delivered ballot among the landowners in the proposed District, with each owner having one vote for each acre or portion of an acre of land such owner owns in the District. Section 9. Except as may otherwise be provided by law or the rate and method of apportionment of the special tax for the District, all lands owned by any public entity, including the United States, the State of California and/or the City of Temecula, or any departments or political subdivisions of any thereof, shall be omitted from the levy of the special tax to be made R:/'I'PFA Resos 2003/TPFA Resos 03-16 2 to cover the costs and expenses of the Facilities and the Services, the elimination of the Prior Lien, the issuance of bonds by the Authority for the District and any expenses of the District. Section 10. The Director of Public Works of the City of Temecula is hereby directed to study said proposed Facilities, Services and Prior Lien and to make, or cause to be made, and file with the Secretary a report in writing, presenting the following: (a) A brief description of the Facilities, the Services and the Prior Lien. (b) An estimate of the fair and reasonable cost of providing the Facilities and the Services, and of eliminating the Prior Lien, including the incidental expenses in connection therewith, including the costs of the proposed bond financing, any Authority or City of Temecula administrative costs and all other related costs. Said report shall be made a part of the record of the public hearing provided for below. Section 11. Tuesday, August 26, 2003, at 7:00 p.m. or as soon thereafter as the matter may be heard, in the regular meeting place of this Board of Directors, City Council Chambers, Temecula City Hall, 43200 Business Park Drive, Temecula, California, be, and the same are hereby appointed and fixed as the time and place when and where this Board of Directors, as legislative body for the District, will conduct a public hearing on the establishment of the District and consider and finally determine whether the public interest, convenience and necessity require the formation of the District and the levy of said special tax. Section 12. The Secretary is hereby directed to cause notice of said public hearing to be given by publication one time in a newspaper published in the area of the District. The publication of said notice shall be completed at least seven days before the date herein set for said hearing. Said notice shall be substantially in the form of Exhibit C hereto. Section 13. The firms of Fieldman, Rolapp & Associates, Albert A. Webb Associates, Stone & Youngberg LLC, Stephen G. White, MAI, Quint & Thimmig LLP and McFarlin & Anderson are hereby designated as financial advisor, special tax consultant, underwriter, appraiser, bond counsel and disclosure counsel, respectively, to the Authority for the District. The Executive Director is hereby authorized to execute agreements with said firms for their services related to the District provided that all fees and expenses of such firms are payable solely from deposits by the landowners in the District or the proceeds of the bonds, if any, issued by the Authority for the District. Section 14. On January 23, 2001, the City Council of the City of Temecula approved the Wolf Creek Project and specifically adopted Resolution No. 01-11 making certain findings with respect to the approval and certification of an Environmental Impact Report for the Project ("Wolf Creek EIR"). The Wolf Creek Project was challenged in litigation which resulted in an appellate decision in favor of the City upholding the Project. All of the public improvements which are to be funded under the proposed Temecula Public Financing Authority Community Facilities District No. 01-03 (Wolf Creek) were described, evaluated and studied as part of the Wolf Creek EIR and Council Resolution No. 01-11. No significant changes have occurred with respect to the project or the environment which require further study or which render invalid the conclusions and findings of the Wolf Creek EIR. No facts exist upon which any findings pursuant to Sections 15162, 15263 or 15265 of the State CEQA Guidelines could be based to require the preparation of a subsequent EIR, supplemental EIR or addendum to an EIR. Therefore, the Board of Directors hereby determines that the contemplated formation of a community facilities R:/'rPFA Resos 2003/TPFA Resos 03-16 3 district and the issuance of community facilities district special tax bonds involving the Authority and the District, in accordance with Section 15061(b) of the California Environmental Quality Act (CEQA) Guidelines is not a "Project" as defined in Section 15378 off the CEQA Guidelines, and is therefore exempt from the requirements of CEQA. Pursuant to CEQA Guidelines Sections 15061(d) and 15062, the Secretary is hereby directed to cause a Notice of Exemption to be prepared, executed and filed in regard to the foregoing determination. Section 15. The Board of Directors may in the future, by resolution, approve an agreement pursuant to Section 53314.9 of the California Government Code, to accept an advance or advances of funds or work-in-kind from one or more landowners in the District or related entities, which advances may be repaid and work-in-kind may be reimbursed to the person or entity which advanced the funds or work-in-kind subject to compliance with the applicable provisions of Section 53314.9 of the California Government Code. Section 16. This Resolution shall take effect upon its adoption. PASSED, APPROVED AND ADOPTED, by the Board of Directors of the Temecula Public Financing Authority at a meeting held on the 22n~ day of July, 2003. ATTEST: on~s, CMC ut~ity Secreta~ [SEA~--.. ~ ~' ~-- ~ ~ J~..f.f~Y I~"=~St~ne, ChairpersOn R:/TPFA Resos 2003fTPFA Resos 03-16 4 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Jones, Secretary of the Temecula Public Financing Authority, HEREBY DO CERTIFY that the foregoing Resolution No. TPFA 03-16 was duly adopted at a special meeting of the Board of Directors of the Temecula Public Financing Authority on the 22nd day of July, 2003, by the following vote: AYES: 5 BOARDMEMBERS: Comerchero, Naggar, Pratt, Roberts, Stone NOES: 0 BOARDMEMBERS: None ABSENT: 0 BOARDMEMBERS: None ABSTAIN: 0 BOARDMEMBERS: None R:,'TPFA Resos 2003/'rPFA Resos 03-16 5 EXHIBIT a TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-03 (WOLF CREEK) DESCRIPTION OF FACILITIES AND SERVICES TO BE FUNDED BY THE DISTRICT AND PRIOR LIEN TO BE ELIMINATED BY THE DISTRICT FACILITIES The CFD may finance all or a portion of the costs of the following: 1. Loma Linda Storm Drain Construct Loma Linda storm drain from Pechanga Parkway to "A" Street a distance of approximately 2020 feet including pipe, manholes, catch basins laterals and other appurtenant improvements necessary to complete the Loma Linda Storm Drain. 2. Wolf Valley Road Construct Wolf Valley Road from Pechanga Parkway to the northeasterly city limits of the City of Temecula, a distance of approximately 3510 feet including grading, paving, landscaping, storm drains, curb and gutter, sidewalks, streetlights and other appurtenant improvements necessary to complete Wolf Valley Road. 3. "A" Street. Construct "A" Street from Loma Linda Road to Interior Loop Road - North, a. distance of approximately 1480 feet including grading, paving, landscaping, storm drains, curb and gutter, sidewalks, streetlights and other appurtenant improvements necessary to complete "A" Street. 4. Interior Loop Road - North Construct Interior Loop Road - North from Wolf Valley Road to Pechanga Parkway, a distance of approximately 3700 feet including grading, paving, landscaping, storm drains, curb and gutter, sidewalks, streetlights and other appurtenant improvements necessary to complete Interior Loop Road - North. 5. Interior Loop Road - South Construct Interior Loop Road - South from Pechanga Parkway to Wolf Valley Road, a distance of approximately 4660 feet including grading, paving, landscaping, storm drains, curb and gutter, sidewalks, streetlights and other appurtenant improvements necessary to construct Interior Loop Road - South. 6. Linear Park and Nodes Construct Linear Park and three Nodes adjacent to Interior Loop Road - North and Interior Loop Road - South through the entire limits of the Wolf Creek project including R:/TPFA Resos 2003/'I'PFA 03-16 6 grading, landscaping, walkways and other appurtenant improvements necessary to Construct the Linear Park and Nodes. 7. Six-Acre Nei.qhborhood Park Planninq Area No. II Construct the Six-Acre Neighborhood Park at the northeast intersection of Wolf Valley Road and Interior Loop Road - North including grading, landscaping, walkways, equipment and other appurtenant improvements necessary to construct the Six-Acre Neighborhood Park. 8. Wolf Creek Fire Station Construction of a fire station located at the southeast corner of Wolf Valley Road and Interior Loop Road - South. 9. Pechanqa Parkway Construction of Pechanga Parkway between State Route 79 - South and Deer Hollow Way including grading, paving, storm drains, curb and gutter, sidewalk, soundwalls and other appurtenant improvements necessary to complete construction of Pechanga Parkway. 10. Sports Park Improvements Acquisition and installation of artificial turf and appurtenances for the Temecula Sports Complex. 11. Public Art Acquisition, construction and installation of art work in public facilities and on public land within the City of Temecula. 12. Eastern Municipal Water District Improvements Sanitary sewer system and water system improvements to be designated by the Eastern Municipal Water District on which it will expend up to $5,627,404 of bond funds. The Facilities shall include the acquisition of right-of-way, the costs of design, engineering and planning, the costs of any environmental or traffic studies, surveys or other reports, the cost of any required environmental mitigation and any required noise mitigation measures, landscaping and irrigation, soils testing, permits, plan check and inspection fees, insurance, legal and related overhead costs, coordination and supervision and any other costs or appurtenances related to any of the foregoing. SERVICES Maintenance of a drainage channel identified in the Wolf Creek Specific Plan adopted by the City Council of the City on January 23, 2001, including but not limited to salaries of City staff related to and a proportionate share of City overhead costs in connection with providing such services. R:/'rPFA Resos 2003FFPFA 03-16 7 PRIOR LIEN The CFD may fund amounts necessary to eliminate all or a portion of the lien imposed by the County of Riverside Assessment District No. 159 on the real property within the CFD. OTHER The CFD may also finance any of the following: 1. Bond related expenses, including underwriter's discount, reserve fund, capitalized interest, bond and disclosure counsel and all other incidental expenses. 2. Administrative fees of the Authority, the City of Temecula and the bond trustee or fiscal agent related to the CFD and any bonded indebtedness of the CFD. 3. Reimbursement of costs related to the formation of the CFD advanced by the Authority, the City or any related entity, or any landowner or developer within the CFD, as well as reimbursement of any costs advanced by the Authority or any related entity, or any landowner or developer within the CFD, for facilities, fees or other purposes or costs of the CFD. R:/TPFA Resos 2003/TPFA 03-16 8 EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-03 (WOLF CREEK) RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A Special Tax shall be levied and collected on all Taxable Property located within the boundaries of the Temecula Public Financing Authority Community Facilities District No. 03-03 (Wolf Creek), ("CFD"). The amount of Special Tax to be levied in each Fiscal Year, commencing in Fiscal Year 2003-2004 on a Parcel shall be determined by the Board of Directors of the Temecula Public Financing Authority or its designee, acting in its capacity as the legislative body of the CFD by applying the appropriate Special Tax as set forth in Sections B., C., and D., below. All of the real property within the CFD, unless exempted by law or by the provisions in Section E., shall be taxed for the purposes, to the extent and in the manner herein provided. A. DEFINITIONS The terms hereinafter set forth have the following meanings: "Acre or Acreage" means the land area of a Parcel as shown on an Assessor's Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other similar recorded County instrument. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1 of Division 2 of Title 5 of the California Government Code of the State of California. "Administrative Expenses" the actual or reasonably estimated costs directly related to the administration of the CFD, including but not limited to: the costs of computing the Special Taxes and of preparing the annual Special Tax collection schedules (whether by the CFD Administrator or designee thereof or both); the costs of collecting the Special Taxes (whether by the Authority, County, City, or otherwise); the costs of remitting the Special Taxes to the Trustee for any Bonds; the costs of commencing and pursuing to completion any foreclosure action arising from delinquent Special Taxes; the costs of the Trustee (including its legal counsel) in the discharge of the duties required of it under any Indenture; the costs of the Authority, City or designee in complying with arbitrage rebate and disclosure requirements of applicable federal and State securities laws, the Act and the California Government Code, including property owner inquiries regarding the Special Taxes; the costs associated with the release of funds from any escrow account; the costs of the Authority, City or designee related to an appeal of the Special Tax; and an allocable share of the salaries of the City staff and City overhead expense directly relating to the foregoing. Administrative Expenses shall also include amounts advanced by the City or the Authority for any administrative purposes of the CFD. R:/TPFA Resos 2003/'rPFA 03-16 9 "Approved Property" means for any Fiscal Year, all Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January 1st preceding the Fiscal Year in which the Special Tax is being levied, and (ii) for which a building permit was not issued prior to the April 1st preceding the Fiscal Year in which the Special Tax is being levied. "Assessor's Parcel Map" means an official map of the County designating parcels by a parcel number. "Assigned Special Tax" means each Land Use Category of Developed Property, as determined in accordance with Section C., below. "Authority" means the Temecula Public Financing Authority. "Backup Special Tax" means the Special Tax A applicable to each Parcel of Developed Property, as determine in accordance with Section C.1 .b. below. "Board of Directors" means the Board of Directors of the Authority, acting as the legislative body of the CFD. "Bonds" means any bonds or other indebtedness (as defined in the Act) issued by the CFD and secured by the levy of Special Taxes. "CFD" means Community Facilities District No. 03-03 (Wolf Creek) of the Authority established pursuant to the Act. "CFD Administrator" means the Finance Director of the City, or designee thereof, responsible for determining the Special Tax Requirement and various other amounts described herein and for providing for the levy and collection of the Special Taxes. "City" means the City of Temecula. "County" means the County of Riverside. "Developed Property" means all Parcels of Taxable Property, not categorized as Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that are not Exempt Property pursuant to the provisions of Section E., below: (i) that are included in a Final Map that was recorded prior to January 1st preceding the Fiscal Year in which the Special Tax is being levied and (ii) a building permit for new construction has been issued prior to April 1st preceding the Fiscal Year in which the Special Tax is being levied. "Exempt Property" means any Parcel, which is exempt from Special Taxes pursuant to Section E., below. "Final Map" means a subdivision of property evidenced by the recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or the recordation of a condominium plan pursuant to California Civil Code 1352 that creates individual lots for which building permits may be issued without further subdivision. R:,'TPFA Resos 2003/TPFA 03-16 10 "Fiscal Year" means the period starting on July 1st and ending on the following June 30th. "Flood Control Channel" means approximately 23.7 acres of channel located within the Wolf Creek Specific Plan No. 12 approved on January 23, 2001. "Indenture" means the indenture, trust agreement, fiscal agent agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. "Land Use Category" means any of the categories listed in Table 1. "Maximum Special Tax" means the Maximum Special Tax A and Maximum Special Tax B. "Maximum Special Tax A" means the maximum amount of Special Tax A, determined in accordance with Section C. below, that can be levied in any Fiscal Year on any Parcel to satisfy the Special Tax A Requirement. "Maximum Special Tax B" means the maximum amount of Special Tax B, determined in accordance with Section C. below, that can be levied in any Fiscal Year on any Parcel to satisfy the Special Tax B Requirement. "Multifamily Residential Property" means any Parcel of Residential Property that consists of a building or buildings comprised of attached residential units available for rental but net purchase, by the general public and under common management. "Multiple Land Use Property" means any Developed Property containing more than one Land Use Category (e.g. one structure containing Non-Residential Property on the ground floor and Residential Property on the 2nd floor), "Non-Residential Floor Area" means all of the square footage within the perimeter of all structures on a Parcel used in part for non-residential purposes, measured from outside wall to outside wall, exclusive of overhangs, porches, patios, carports, or similar spaces attached to the building but generally open on at least two sides, as determined by reference to the building permit(s) issued for said Parcel, or if these are not available, as otherwise determined by the CFD Administrator. Once such determination has been made for a Parcel, it shall remain fixed in all future Fiscal Years. "Non-Residential Property" means all Parcels of Developed Property for which a building permit was issued for any type of non-residential use. "Parcel(s)" means a lot or parcel shown on an Assessor's Parcel Map with an assigned parcel number as of January 1st preceding the Fiscal Year for which the Special Tax is being levied. "Property Owner's Association Property" means any property within the boundary of the CFD, which, as of January 1st of the preceding Fiscal Year for which the Special Tax is being levied has been conveyed, dedicated to, or irrevocably dedicated to a property owner association, including any master or sub-association. R:/'rPFA Resos 2003~rPFA 03-16 11 "Proportionately" means for Developed Property that the ratio of the actual Special Tax levy to the Assigned Special Tax is the same for all Parcels of Developed Property and for Approved Property, Undeveloped Property, Public Property and/or Property Owners Association Property that is not Exempt Property pursuant to Section E., that the ratio of actual Special Tax levy per Acre to the Maximum Special Tax per Acre is the same for all such Parcels. "Public Property" means any property within the boundary of the CFD which, as of January 1st of the preceding Fiscal Year for which the Special Tax is being levied is used for rights-of-way or any other purpose and is owned by, dedicated to, or irrevocably offered for dedication to the federal government, the State of California, the County, City or any other local jurisdiction, provided, however, that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use. "Residential Floor Area" means all of the square footage within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area shall be made by the CFD Administrator with reference to the building permit(s) issued for such Assessor's Parcel or other appropriate means selected by the CFD Administrator. Once such determination has been made for a parcel, it shall remain fixed in all future Fiscal Years. "Residential Property" means all Parcels of Developed Property for which a building permit has been issued for purposes of constructing one or more residential dwelling units. "Special Tax(es)" means Special Tax A or Special Tax B. "Special Tax A" means the Special Tax to be levied in each Fiscal Year on each Parcel of Developed Property, Approved Property, Undeveloped Property, Property Owner Association Property and Public Property that is not Exempt Property pursuant to the provisions in Section E., to fund the Special Tax A Requirement, and shall include Special Taxes levied or to be levied under Sections D., below. "Special Tax B" means the Special Tax to be levied in each Fiscal Year on each Parcel of Developed Property, Approved Property, Undeveloped Property, Property Owner Association Property and Public Property that is not Exempt Property pursuant to the provisions in Section E., to fund the Special Tax B Requirement, and shall include Special Taxes levied or to be levied under Sections D., below. "Special Tax A Requirement" means that amount required in any Fiscal Year to pay: (i) annual debt service on all outstanding Bonds due in the calendar year which commences in such Fiscal Year; (ii) periodic costs on the Bonds, including but not limited to, credit enhancement and rebate payments on the Bonds; (iii) Administrative Expenses; (iv) an amount equal to any anticipated shortfall due to Special Tax A delinquency in the prior Fiscal Year; and (v) any amounts required to establish or replenish any reserve funds for the outstanding Bonds; less (vi) a credit for funds available to reduce the annual Special Tax A levy as determined pursuant to the Indenture. "Special Tax B Requirement" means that amount required in any Fiscal Year to pay the estimated costs of providing services, including the salaries of City staff related to and a proportionate share of City overhead costs, for the maintenance of the Flood Control R:/TPFA Resos 2003/TPFA 03-16 12 Channel in an amount not to exceed $100,000 for Fiscal Year 2003-2004, increasing by 2% each Fiscal Year there after. "Taxable Property" means all Parcels in the CFD which are not exempt from the Special Tax pursuant to law or Section E., below. "Total Floor Area" means for any Parcel identified as Multiple Land Use Property pursuant to Section C.l.c., below, the sum of the Residential Floor Area and Non-Residential Floor Area. "Undeveloped Property" means all Taxable Property not classified as Developed Property, Approved Property, Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E. B. ASSIGNMENT TO LAND USE CATEGORY Each Fiscal Year, commencing with the 2003-2004 Fiscal Year, all Parcels of Taxable Property within the CFD shall be categorized as either Developed Property, Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions in Section E., and shall be subject to the levy of Special Taxes in accordance with this Rate and Method of Apportionment as determined pursuant to Sections C., and D., below. Parcels of Developed Property shall further be categorized as Residential Property, Non- Residential Property, or Multiple Land Use Property. A Parcel of Residential Property shall further be categorized to its appropriate Land Use Category based on the Residential Floor Area of such Parcel unless it qualifies as Multifamily Residential Property, for which the Assigned Special Tax shall be based on the number of Acres. C. MAXIMUM SPECIAL TAX RATE 1. Developed Property The Maximum Special Tax A for each Parcel of Residential Property that is categorized as Developed Property shall be the greater of: (i) the applicable Assigned Special Tax described in Table 1., below, or (ii) the amount derived by application of the Backup Special Tax A. The Maximum Special Tax A for each Parcel of Non-Residential Property or Multifamily Residential Property shall be the Assigned Special Tax described in Table 1. The Maximum Special Tax B for each Parcel of Residential Property other than Multifamily Residential Property shall be $58.00 per unit. The Maximum Special Tax B for each parcel of Non-Residential Property or Multifamily Residential Property shall be $385 per acre. These amounts shall increase by 2.00% each year following Fiscal Year 2003-2004. The Maximum Special Tax for each Parcel categorized as Developed Property shall be the Maximum Special Tax A plus the Maximum Special Tax B. R:/TPFA Rosos 2003/TPFA 03-16 13 Assi.qned Special Tax The Assigned Special Tax for each Parcel of Developed Property, except Multiple Land Use Property, is shown in Table 1., below. TABLE 1 Assigned Special Taxes for Developed Property ASsigned Taxabl . spedial Tax Land Use Category e Residential FlOOr Area ~ Per Unit Taxable Unit A - Residential Property D/U 4,000 or more sq. ft. $2,294 B - Residential Property D/U 3,600 or more, but less than 4,000 $1,599 sq. ft. C - Residential Property D/U 3,200 or more, but less than 3,600 $1,538 sq. ft. D - Residential Property D/U 2,800 or more, but less than 3,200 $1,360 sq. ft. E - Residential Property D/U 2,400 or more, but less than 2,800 $1,229 sq. ft. F - Residential Property D/U 2,000 or more, but less than 2,400 $1,120 sq. ft. G - Residential Property D/U Less than 1,600 sq. ft. $987 H - Multifamily Residential Acre N/A $8,892 Property I - Non-Residential Property Acre N/A $8,892 b. Backup Special Tax The Backup Special Tax shall be $8,892 per Acre for Parcels of Developed Property that are included in a Final Map. Notwithstanding the foregoing, if parcels of Residential property are subsequently changed or modified by recordation of a lot line adjustment or similar instrument, then the Backup Special Tax shall be recalculated. c. Multiple Land Use Property In some instances a Parcel of Developed Property may contain more than one Land Use Category. The Assigned Special Tax levied on such a Parcel shall be the sum of the Assigned Special Tax levies for all Land Use Categories located on that Parcel. The Backup Special Tax A levied on a Parcel shall be the sum of the Backup Special Tax A levies that can be imposed on all Land Use Categories located on that Parcel. The Maximum Special Tax A levied on a Parcel shall be R:/TPFA Resos 2003rrPFA 03-16 14 the sum of the Maximum Special Tax A levies that can be imposed on all Land Use Categories located on that Parcel. For purposes of calculating the Backup Special Tax A (but not the Assigned Special Tax) for each Land Use Category under such circumstances, the Acreage assigned to each Land Use Category shall be based on the proportion of Residential Floor Area or Non-Residential Floor Area that is built for each Land Use Category as compared with the Total Floor Area built on the Parcel. The CFD Administrator shall determine all allocations made under this section, and all such allocations shall be final. 2. Approved Property The Maximum Special Tax A for each Parcel of Approved Property shall be $6,404 per Acre. The Maximum Special Tax B for each Parcel of Approved Property shall be $385 per Acre and shall increase by 2.00% each year following Fiscal Year 2003-2004. The Maximum Special Tax for each Parcel categorized as Approved Property shall be the Maximum Special Tax A plus the Maximum Special Tax B. 3. Undeveloped Property The Maximum Special Tax A for each Pamel of Undeveloped Property shall be $8,892 per Acre. The Maximum Special Tax B for each Parcel of Undeveloped Property shall be $385 per Acre and shall increase by 2.00% each year following Fiscal Year 2003-2004. The Maximum Special Tax for each Parcel categorized as Undeveloped Property shall be the Maximum Special Tax A plus the Maximum Special Tax B. 4. Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E. The Maximum Special Tax for each Parcel of Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E., shall be $8,892 per Acre. D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX Commencing with Fiscal Year 2003-2004 and for each following Fiscal Year, the CFD Administrator shall levy the Special Tax on all Taxable Property as follows: First: The Special Tax A shall be levied Proportionately on each Parcel of Developed Property at up to 100% of the applicable Assigned Special Tax rate in Table 1 as needed to satisfy the Special Tax A Requirement. The Special Tax B shall be levied Proportionately on each Parcel of Developed Property at up to 100% of the Maximum Special Tax B as needed to satisfy the Special Tax B requirement; Second: If additional moneys are needed to satisfy the Special Tax A Requirement after the first step has been completed, the Special Tax A shall be levied Proportionately on each Parcel of Approved Property at up to 100% of the Maximum Special Tax A for Approved Property. If additional moneys are needed to satisfy the Special Tax B Requirement after the first step has been completed, the Special Tax B shall be levied Proportionately on each R:/TPFA Resos 2003/'rPFA 03-16 15 Parcel of Approved Property at up to 100% of the Maximum Special Tax B for Approved Property; Third: If additional moneys are needed to satisfy the Special Tax A Requirement after the first two steps have been completed, the Special Tax A shall be levied Proportionately on each Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax A for Undeveloped Property. If additional moneys are needed to satisfy the Special Tax B Requirement after the first two steps have been completed, the Special Tax B shall be levied Proportionately on each Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax B for Undeveloped Property; Fourth: If additional moneys are needed to satisfy the Special Tax A Requirement after the first three steps have been completed, the Special Tax A to be levied on each Parcel of Developed Property whose Maximum Special Tax A is derived by the application of the Backup Special Tax shall be increased in equal percentages from the Assigned Special Tax up to the Maximum Special Tax A for each such Parcel; Fifth: If additional moneys are needed to satisfy the Special Tax Requirement A after the first four steps have been completed, the Special Tax A shall be levied Proportionately on each Parcel of Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E., at up to 100% of the Maximum Special Tax A. Notwithstanding the above, under no circumstances will the Special Taxes levied against any Parcel of Residential Property be increased by more than ten percent (10%) per Fiscal Year as a consequence of delinquency or default by the owner of any other Parcel within the CFD. E. EXEMPTIONS The Board shall not levy Special Taxes on up to 33 Acres of Public Property conveyed or irrevocably offered for dedication to a public school district. The Board shall further not levy Special Taxes up to 232 Acres of Public Property and/or Property Owner's Association Property of the CFD. The CFD Administrator will assign Exempt Property status in the chronological order in which property becomes Public Property and/or Property Owner's Association Property. After the limit of Acres within each of the above has been reached, the Maximum Special Tax A obligation for any additional Public Property and/or Property Owner's Association Property shall be prepaid in full pursuant to Section H., prior to the transfer or dedication of such property. Until the Maximum Special Tax A obligation is prepaid as provided for in the preceding sentence, the Public Property and/or Property Owner's Association Property within the CFD shall be subject to the levy of the Special Tax as provided for in the fifth step in Section D. F. MANNER OF COLLECTION The Special Tax shall be collected in the same manner and at the same time as ordinary Ad valorem property taxes and shall be subject to the same penalties, the same procedure, sale and lien priority in the case of delinquency; provided, however, that the CFD R:/'rPFA Resos 2003/'rPFA 03-16 16 Administrator may directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner if necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Parcels having delinquent Special Taxes as permitted by the Act. G. REVIEW AND APPEAL Any taxpayer may file a written appeal of the Special Tax levied on his/her property with the CFD Administrator, provided that the appellant is current in his/her payments of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The appeal must specify the reasons why the appellant claims the Special Tax is in error. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, the CFD Administrator shall grant a credit to eliminate or reduce future Special Taxes on the appellant's property. No refunds of previously paid Special Taxes shall be made. H, PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section H: "CFD Public Facilities means $25,800,000 expressed in 2003 dollars, which shall increase by the Construction Inflation Index on July 1,2004, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide the public facilities under the authorized bonding program of the CFD, or (ii) shall be determined by the Board of Directors concurrently with a covenant that it will not issue any more Bonds to be supported by Special Taxes levied under this Rate and Method of Apportionment. "Construction Fund" means an account specifically identified in the Indenture to hold funds that are currently available for expenditure to acquire or construct 3ublic facilities eligible to be funded by the CFD under the Act. "Construction Inflation Index" means the annual percentage change in the Engineering News-Record Building Cost Index for the City of Los Angeles, measured as of the calendar year, which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Engineering New-Record Building Cost Index for the City of Los Angeles. "Future Facilities Costs" means the CFD Public Facilities minus public facility costs funded or available to be funded by the amount in the Construction Fund, and minus public facility costs funded by interest earnings on the Construction Fund actually earned prior to the date of prepayment. "Outstanding Bonds" means all previously issued Bonds secured by the levy of Special Taxes, which will remain outstanding after the first interest and/or principal payment date following the current Fiscal Year, excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of Maximum Special Taxes. R:/TPFA Resos 2003/'rPFA 03-16 17 t. Prepayment in Full - Special Tax A 1. The Maximum Special Tax A obligation may only be prepaid and permanently satisfied by a Parcel of Developed Property, Approved Property for which a building permit has been issued, or Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to Section E, except that a Special Tax B may be levied on such Parcel after the prepayment has occurred. The Maximum Special Tax A obligation applicable to such Parcel may be fully prepaid and the obligation of the Parcel to pay the Special Tax A permanently satisfied as described herein; provided that a prepayment may be made only if there are no delinquent Special Taxes with respect to the Parcel at the time of prepayment. An owner of a Parcel intending to prepay the Maximum Special Tax A obligation shall provide the CFD Administrator with written notice of intent to prepay, and within 10 business days of receipt of such notice, the CFD Administrator shall notify such owner of the amount of the non-refundable deposit determined to cover the cost to be incurred by the CFD in calculating the proper prepayment amount. Within 5 business days of receipt of such non-refundable deposit, the CFD Administrator shall notify such owner of the Prepayment Amount of such Parcel. Prepayment must be made not less than 60 days prior to any redemption date, unless authorized by the CFD Administrator, for any Bonds to be redeemed with the proceeds of such prepaid Special Tax A. The Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below): Bond Redemption Amount plus plus plus plus less Total: equals Redemption Premium Future Facilities Amount Defeasance Amount Administrative Fees and Expenses Reserve Fund Credit Prepayment Amount As of the proposed date of prepayment, the Prepayment Amount (defined below) shall be calculated as follows: For Parcels of Developed Property, compute the Maximum Special Tax A for the Parcel to be prepaid. For Parcels of Approved Property to be prepaid, compute the Maximum Special Tax A for that Parcel as though it was already designated as Developed Property, based upon the building permit, which has already been issued for that Parcel. For Parcels of Public Property and/or Property Owner's Association Property to be prepaid, compute the Maximum Special Tax A for that Parcel. Divide the Maximum Special Tax A computed pursuant to paragraph 1 by the total estimated Maximum Special Taxes A based on the Developed Property Special Tax A which could be charged on all expected development, less any Parcels which have been prepaid. Multiply the quotient computed pursuant to paragraph 2 by the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid (the "Bond Redemption Amount'). R:/TPFA Resos 2003/'I'PFA 03-16 18 Multiply the Bond Redemption Amount computed pursuant to paragraph 3 by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed (the "Redemption Premium'~. 5. Compute the Future Facilities Costs. Multiply the quotient computed pursuant to paragraph 2 by the amount determined pursuant to paragraph 5 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities Amount'~ Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds. 8. Determine the Special Taxes A levied on the Parcel in the current Fiscal Year which have not yet been paid. Compute the amount the CFD Administrator reasonably expects to derive from the reinvestment of the Bond Redemption Amount less the Future Facilities Amount from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the prepayment. 10. Add the amounts computed pursuant to paragraphs 7 and 8 and subtract the amount computed pursuant to paragraph 9 (the "Defeasance Amount'). 11. Verify the administrative fees and expenses, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming the Outstanding Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). 12. The reserve fund credit (the "Reserve Fund Credit') shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Outstanding Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Outstanding Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. 13. The Maximum Special Tax A prepayment is equal to the sum of the amounts computed pursuant to paragraphs 3, 4, 6, 10 and 11, less the amount computed pursuant to paragraph 12 (the "Prepayment Amount'). 14. From the Prepayment Amount, the amounts computed pursuant to paragraphs 3, 4, 10 and 12 shall be deposited into the appropriate fund as established under the Indenture and be used to retire Outstanding Bonds or make debt service payments. The amount computed pursuant to paragraph 6 shall be deposited into the Construction Fund. The amount computed pursuant to paragraph 11 shall be retained by the CFD. The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be R:/'rPFA Resos 2003/TPFA 03-16 19 retained in the appropriate fund established under the Indenture to be used with the next prepayment of Bonds or to make debt service payments. As a result of the payment of the current Fiscal Year's Special Tax A levy as determined under paragraph 8 (above), the CFD Administrator shall remove the current Fiscal Year's Special Tax A levy for such Parcel from the County tax rolls. With respect to any Parcel that is prepaid, the Board of Directors shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of Special Tax A and the release of the Special Tax A lien on such Parcel, and the obligation of such Parcel to pay the Special Tax A shall cease. However, Special Tax B shall still be levied on such Parcel. Notwithstanding the foregoing, no Special Tax A prepayment shall be allowed unless the amount of Maximum Special Tax A that may be levied on Taxable Property after the proposed prepayment is at least 1.10 times the maximum annual debt service on all Outstanding Bonds. 2. Prepayment in Part - Special Tax A The Maximum Special Tax A on a Parcel of Developed Property or a Parcel of Approved Property for which a building permit has been issued may be partially prepaid in increments of $5,000. The amount of the prepayment shall be calculated as in Section H.I., except that a partial prepayment shall be calculated according to the following formula: PP = ((PE -A)x F)+A These terms have the following meaning: PP = the partial prepayment PE = the Prepayment Amount calculated according to Section H.1 F = the percent by which the owner of the Parcel(s) is partially prepaying the Maximum Special Tax A. A = the Administrative Fees and Expenses calculated according to Section H.1 An owner of a Parcel intending to partially prepay the Maximum Special Tax A shall notify the CFD Administrator of (i) such owner's intent to partially prepay the Maximum Special Tax A, (ii) the percentage by which the Maximum Special Tax A shall be prepaid, and (iii) the company or agency that will be acting as the escrow agent, if applicable, and within 10 business days of receipt of such notice, the CFD Administrator shall notify such owner of the amount of the non-refundable deposit determined to cover the cost to be incurred by the CFD in calculating the proper amount of a partial prepayment. Within 5 business days of receipt of such non-refundable deposit, the CFD Administrator shall notify such owner of the partial Prepayment Amount of such Parcel. Partial prepayment must be made not less than 60 days prior to any redemption date for any Bonds to be redeemed with the proceeds of such prepaid Special Tax A. With respect to any Parcel that is partially prepaid, the CFD Administrator shall (i) distribute the funds remitted to it according to Paragraph 14 of Section H.I., and (ii) indicate in the records of the CFD that there has been a partial prepayment of the Maximum Special Tax A and that a portion of the Maximum Special Tax A equal to the outstanding percentage (1.00 - F) of the remaining Maximum Special Tax A shall continue to be authorized to be levied on R:/TPFA Resos 2003fTPFA 03-16 20 such Parcel pursuant to Section D. However, Special Tax B shall still be levied on such Parcel. TERM OF THE SPECIAL TAX Special Tax A shall be levied for a period not to exceed 50 Fiscal Years, commencing with Fiscal Year 2003-2004: All Parcels of Taxable Property within CFD No. 03-03 shall continue to be subject to the levy and collection of the Special Tax to satisfy the Special Tax B Requirement. R:/'rPFA Resos 2003/TPFA 03-16 21 EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-03 (WOLF CREEK) NOTICE OF PUBLIC HEARING Notice is hereby given that on July 22, 2003, the Board of Directors of the Temecula Public Financing Authority adopted a Resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority Declaring Its Intention To Establish A Community Facilities District And To Authorize The Levy Of Special Taxes Therein - Wolf Creek 03-03." Pursuant to the Mello-Roos Community Facilities Act of 1982, the Board of Directors of the Authority hereby gives notice as follows: A. The text of said Resolution of Intention is as follows: WHEREAS, under the Mello-Roos Community Facilities Act of 1982, constituting Section 53311 et seq. of the California Government Code (the "Law"), this Board of Directors may commence proceedings for the establishment of a community facilities district; and WHEREAS, there has been submitted to this Board of Directors a Petition (Including Waiver) of S-P Murdy, LLC (the "Petition"), requesting the formation by this Board of Directors of a community facilities district under the Law to be known as the Temecula Public Financing Authority Community Facilities District No. 03-03 (Wolf Creek) (the "District"); and WHEREAS, under the Law, this Board of Directors is the legislative body for the proposed District and is empowered with the authority to establish the District and levy special taxes within the District; and WHEREAS, this Board of Directors now desires to proceed with the actions necessary to consider the establishment of the District. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: Section 1. This Board of Directors proposes to begin the proceedings necessary to establish the District pursuant to the Law. Receipt of the Petition to form the District is hereby acknowledged. Section 2. The name proposed for the District is Temecula Public Financing Authority Community Facilities District No. 03-03 (Wolf Creek). Section 3. The proposed boundaries of the District are as shown on the map of the District on file with the Secretary, which boundaries are hereby preliminarily approved. The Secretary is hereby directed to record, or cause to be recorded, the map R:.,'rPFA Resos 2003,,'rPFA 03-16 22 of the boundaries of the District in the office of the County Recorder as soon as practicable after the adoption of this Resolution. Section 4. The types of public facilities (the "Facilities") and the maintenance services (the "Services") proposed to be eligible for funding by the District and pursuant to the Law, and the fixed special assessment lien to be eliminated in whole or in part by payments from the District and pursuant to the Law, shall consist of those items listed on Exhibit A hereto under the headings "Facilities," "Services" and "Prior Lien," respectively, which Exhibit is by this reference incorporated herein. The Executive Director is hereby authorized and directed to enter into a joint community facilities agreement with the City of Temecula, with the Riverside County Flood Control and Water Conservation District, with the Temecula Community Services District, with the Eastern Municipal Water District, and with any other public entity that will own and/or operate any of the Facilities or provide such Services, such agreements to be in a form provided by Bond Counsel. Section 5. Except to the extent that funds are otherwise available to the District to pay for the Facilities, the Services, and the elimination of the Prior Lien and/or pay the principal and interest as it becomes due on bonds of the District issued to pay for the Facilities, the Services, and the elimination of the Prior Lien, a special tax sufficient to pay the costs thereof, secured by recordation of a continuing lien against all non-exempt real property in the District, will be levied within the District and collected in the same manner as ordinary ad valorem property taxes or in such other manner as this Board of Directors or its designee shall determine, including direct billing of the affected property owners. The proposed rate and method of apportionment of the special tax among the parcels of real property within the District, in sufficient detail to allow each landowner within the proposed District to estimate the maximum amount such owner will have to pay, and which specifies the tax year after which no further special tax will be levied on land used for private residential purposes and which otherwise complies with applicable provisions of the Law is described in Exhibit B attached hereto which Exhibit is by this reference incorporated herein. This Board of Directors finds that the provisions of Section 53313.6, 53313.7 and 53313.9 of the California Government Code (relating to adjustments to ad valorem property taxes and schools financed by a community facilities district) are inapplicable to the District. Section 6. It is the intention of this Board of Directors, acting as the legislative body for the District, to cause bonds of the Authority to be issued for the District pursuant to the Law to finance a portion of the costs of the Facilities and the Services, and to finance the elimination of the Prior Lien. if so issued, the bonds shall be in the aggregate principal amount of not to exceed $33,000,000, shall bear interest payable semi-annually or in such other manner as this Board of Directors shall determine, at a rate not to exceed the maximum rate of interest as may be authorized by applicable law at the time of sale of such bonds, and shall mature not to exceed 40 years from the date of the issuance thereof. Section 7. This Board of Directors reserves to itself the right and authority to allow any interested owner of property in the District, subject to the provisions of Section 53344.1 of the California Government Code and such requirements as it may otherwise R:/TPFA Resos 2003/TPFA 03-16 23 impose, and any applicable prepayment penalties as prescribed in the indenture or fiscal agent agreement for any bonds of the Authority for the District, to tender to the Treasurer of the Authority in full payment or part payment of any installment of special taxes or the interest or penalties thereon which may be due or delinquent, but for which a bill has been received, any bond or other obligation secured thereby, in the manner described in Section 53344.1 of the California Government Code. Section 8. The levy of said proposed special tax shall be subject to the approval of the qualified electors of the District at a special election. The proposed voting procedure shall be by mailed or hand-delivered ballot among the landowners in the proposed District, with each owner having one vote for each acre or portion of an acre of land such owner owns in the District. Section 9. Except as may otherwise be provided by law or the rate and method of apportionment of the special tax for the District, all lands owned by any public entity, including the United States, the State of California and/or the City of Temecula, or any departments or political subdivisions of any thereof, shall be omitted from the levy of the special tax to be made to cover the costs and expenses of the Facilities and the Services, the elimination of the Prior Lien, the issuance of bonds by the Authority for the District and any expenses of the District. Section 10. The Director of Public Works of the City of Temecula is hereby directed to study said proposed Facilities, Services and Prior Lien and to make, or cause to be made, and file with the Secretary a report in writing, presenting the following: (a) A brief description of the Facilities, the Services and the Prior Lien. (b) An estimate of the fair and reasonable cost of providing the Facilities and the Services, and of eliminating the Prior Lien, including the incidental expenses in connection therewith, including the costs of the proposed bond financing, any Authority or City of Temecula administrative costs and all other related costs. Said report shall be made a part of the record of the public hearing provided for below. Section 11. Tuesday, August 26, 2003, at 7:00 p.m. or as soon thereafter as the matter may be heard, in the regular meeting place of this Board of Directors, City Council Chambers, Temecula City Hall, 43200 Business Park Drive, Temecula, California, be, and the same are hereby appointed and fixed as the time and place when and where this Board of Directors, as legislative body for the District, will conduct a public hearing on the establishment of the District and consider and finally determine whether the public interest, convenience and necessity require the formation of the District and the levy of said special tax. Section 12. The Secretary is hereby directed to cause notice of said public hearing to be given by publication one time in a newspaper published in the area of the District. The publication of said notice shall be completed at least seven days before the date herein set for said hearing. Said notice shall be substantially in the form of Exhibit C hereto. R:/TPFA Resos 2003/TPFA 03-16 24 Section 13. The firms of Fieldman, Rolapp & Associates, Albert A. Webb Associates, Stone & Youngberg LLC, Stephen G. White, MAI, Quint & Thimmig LLP and McFarlin & Anderson are hereby designated as financial advisor, special tax consultant, underwriter, appraiser, bond counsel and disclosure counsel, respectively, to the Authority for the District. The Executive Director is hereby authorized to execute agreements with said firms for their services related to the District provided that all fees and expenses of such firms are payable solely from deposits by the landowners in the District or the proceeds of the bonds, if any, issued by the Authority for the District. Section 14. On January 23, 2001, the City Council of the City of Temecula approved the Wolf Creek Project and specifically adopted Resolution No. 01-11 making certain findings with respect to the approval and certification of an Environmental Impact Report for the Project ("Wolf Creek EIR"). The Wolf Creek Project was challenged in litigation which resulted in an appellate decision in favor of the City upholding the Project. All of the public improvements which are to be funded under the proposed Temecula Public Financing Authority Community Facilities District No. 01-03 (Wolf Creek) were described, evaluated and studied as part of the Wolf Creek EIR and Council Resolution No. 01-11. No significant changes have occurred with respect to the project or the environment which require further study or which render invalid the conclusions and findings of the Wolf Creek EIR. No facts exist upon which any findings pursuant to Sections 15162, 15263 or 15265 of the State CEQA Guidelines could be based to require the preparation of a subsequent EIR, supplemental EIR or addendum to an EIR. Therefore, the Board of Directors hereby determines that the contemplated formation of a community facilities district and the issuance of community facilities district special tax bonds involving the Authority and the District, in accordance with Section 15061 (b) of the California Environmental Quality Act (CEQA) Guidelines is not a "Project" as defined in Section 15378 off the CEQA Guidelines, and is therefore exempt from the requirements of CEQA. Pursuant to CEQA Guidelines Sections 15061(d) and 15062, the Secretary is hereby directed to cause a Notice of Exemption to be prepared, executed and filed in regard to the foregoing determination. Section 15. The Board of Directors may in the future, by resolution, approve an agreement pursuant to Section 53314.9 of the California Government Code, to accept an advance or advances of funds or work-in-kind from one or more landowners in the District or related entities, which advances may be repaid and work-in-kind may be reimbursed to the person or entity which advanced the funds or work-in-kind subject to compliance with the applicable provisions of Section 53314.9 of the California Government Code. Section 16. This Resolution shall take effect upon its adoption. B. The exhibits to the Resolution which describe the facilities and services to be funded, the prior lien to be eliminated, and the rate and method of apportionment of the special taxes for, the district are on file in the office of the Secretary of the Authority. C. The time and place established under said Resolution for the public hearing required under the Act are Tuesday, August 26, 2003, at the hour of 7:00 p.m. or as soon thereafter as the matter may be heard, in the regular meeting place of the Board of Directors, City Council Chambers, Temecula City Hall, 43200 Business Park Drive, Temecula, California. R:/TPFA Resos 2003/TPFA 03-16 25 D. At said hearing, the testimony of all interested persons or taxpayers for or against the establishment of the district, the extent of the district or the furnishing of the specified types of facilities, services or other specific purposes of the district will be heard. Any person interested may file a protest in writing with the Secretary. If fifty percent or more of the registered voters, or six registered voters, whichever is more, residing in the territory proposed to be included in the district, or the owners of one-half or more of the area of land in the territory proposed to be included in the district and not exempt from the special tax file written protests against the establishment of the district and the protests are not withdrawn to reduce the value of the protests to less than a majority, the Board of Directors shall take no further action to establish the district or levy the special taxes for a period of one year from the date of the decision of the Board of Directors, and if the majority pretests of the registered voters or the landowners are only against the furnishing of a type or types of facilities or services within the district or a specific purpose of the district, or against levying a specified special tax, those types of facilities or services, or those specific purposes or the specified special tax will be eliminated from the proceedings to form the district. E. The proposed voting procedure shall be by special mail or hand-delivered ballot to the property owners within the territory proposed to be included in the district. Dated: July 22nd, 2003 /si Susan W. Jones, CMC Secretary, Temecula Public Financing Authority R:/TPFA Resos 2003/TPFA 03-16 26