HomeMy WebLinkAbout2020-01-28 - AGENDA REPORTS - APPROVAL OF THE PROPOSED CITY OF SC CMTY FACILITIE (2)Agenda Item: 8
DATE: January 28, 2020
SUBJECT: APPROVAL OF THE PROPOSED CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA
CANYON) SPECIAL TAX BONDS, 2020 SERIES AND APPROVAL
OF THE EXECUTION AND DELIVERY OF A FISCAL AGENT
AGREEMENT, A CONTINUING DISCLOSURE CERTIFICATE, A
BOND PURCHASE AGREEMENT, AND A PRELIMINARY
OFFICIAL STATEMENT
DEPARTMENT: Administrative Services
PRESENTER: Michael Villegas
RECOMMENDED ACTION
City Council:
Adopt a resolution authorizing the issuance of the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series in an amount not to
exceed $22 million and approving the execution and delivery of a Fiscal Agent Agreement, a
Continuing Disclosure Certificate, a Bond Purchase Agreement, and a Preliminary Official
Statement in connection therewith.
2. Adopt a resolution approving the execution and delivery of the Parking Management
Services Agreement, Parking Spaces Acquisition Agreement, and Easement Agreement for
Solar Facilities and Community Identification Signage in connection with the acquisition of
the Cooper Street Parking Facility.
BACKGROUND
The Vista Canyon project was approved by City Council on April 26, 2011. At the meeting, the
City Council approved Resolution No. 11-23, which included Final Conditions of Approval and
the Transit Funding Agreement which contemplated the creation of a community facilities
district over commercial properties, inclusive of apartments, within the Vista Canyon project and
required Vista Canyon's commitment to allocate 15 percent of the net construction proceeds of
any bonds to the construction of the Vista Canyon Transit Center.
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The City of Santa Clarita (City) received a petition, including consent and waiver, to form a
community facilities district with respect to the Vista Canyon development from the owners of
the property in the proposed development (collectively, "Owner"). Located at the end of Lost
Canyon Road near Sand Canyon, the approved Vista Canyon development will include up to
1,100 dwelling units (apartments, townhomes, and detached single family) as well as 950,000
square feet of commercial space. Land development is underway and the applicant is moving
forward on the initial phase of the project. Phase 1 includes apartments, the first office/retail
building, and the first parking structure.
Following a public hearing and election, on April 12, 2016, a community facilities district was
formed, designated "City of Santa Clarita Community Facilities District No. 2016-1 (Vista
Canyon)" (the "CFD"), and the CFD was authorized to issue bonds secured by special taxes
within the CFD to fund up to three parking structures and a portion of the approved transit
center, totaling up to $45 million (the "Project"). Additionally, the authorization to issue bonds
required that 15 percent of net construction proceeds of each bond issuance be set aside for the
Vista Canyon Transit Center.
Under the Rate and Method of Apportionment (RMA), parcels for apartments and commercial
use will be subject to the special tax which will secure the debt service on bonds to be issued.
The CFD is comprised of two tax zones, Zone 1 and Zone 2. It is important to note, parcels for
single family (for -sale) residential units are not subject to the CFD tax. The proposed financing
meets the City's policy guidelines for establishing CFDs, except that the proposed financing
provides for bond debt service and special taxes to increase at 2 percent per year through the
proposed 30-year term. However, this policy issue was addressed at the time the CFD was
formed in 2016.
The special tax will be levied annually by the City pursuant to the RMA and used to pay bond
debt service on the proposed Series 2020 Bonds and any future bonds to finance the remaining
parking garages and transit center. Special taxes in the amount of $575,000 were levied for the
2019-2020 tax year and will be used to pay debt service on the Series 2020 Bonds. The "not to
exceed" bond amount for each bond series will be based on parking facility and transit center
costs and available special taxes under the RMA. The not to exceed amount for the Series 2020
Bonds is $22 million. The proceeds from this first issue will cover the cost of the Cooper Street
Parking Facility, the cost of bond issuance, bond reserves, and 15 percent of net proceeds for the
Vista Canyon Transit Center. The City in its sole discretion will determine the final amount of
each series of bonds issued including the Series 2020 Bonds.
The costs of undertaking this financing will be funded entirely by the proposed Series 2020 Bond
issue. The proposed Series 2020 Bonds are secured solely by the CFD special taxes levied
annually on privately owned property in the CFD. No bond rating will be applied for. The master
developer, Vista Canyon Ranch LLC plans to sell parcels to third party developers and/or
develop the project in partnership with other developers. While there is still significant additional
public infrastructure to be completed, substantial progress has been made on property sales and
property development. Parcels have been sold to a leading apartment builder, JPI, which is
completing a 480-apartment unit project, and the master developer which is completing 60,000
square feet of office/retail space. The Cooper Street public parking garage to be financed by the
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Series 2020 Bonds is within weeks of being completed, and funding for the Vista Canyon Transit
Center is already in place. The property subject to the special tax has been appraised at $124
million by an independent appraiser retained by the City as part of the bond issuance process.
The first series of bonds are proposed to total $18.055 million with $15 million being used to
acquire the Cooper Street Parking Facility and $2.65 million towards the transit center. The lien
of the special taxes is senior to all private financing providing security to the bondholders. There
is an overlapping CFD created by the Sulphur Springs Union School District for school fees.
Potential investors will look closely at the value of the property underlying the Series 2020
Bonds relative to the special tax lien and assess the master developer's plans, experience, and
financial resources. Most industry professionals, including the City's CFD policies, consider a
3.5:1 value to lien as a minimum for property securing a special tax bond issue. Based on
appraised values as of December 2, 2019, date of value of the property within the CFD, the
aggregate average value to lien for these bonds is over 5:1 even when considering additional
CFD taxes and possible additional CFD bonds levied or issued by the Sulphur Springs Union
School District CFD. The appraised values for the undeveloped properties have an estimated
value to lien of approximately 4:1.
The Series 2020 Bonds will initially be sold in minimum denominations of $100,000 rather than
the standard $5,000. This will assure that the Series 2020 Bonds are sold to institutions and other
sophisticated investors who better understand the development risks involved. There is also the
requirement that the original buyers of the Series 2020 Bonds can only resell the Series 2020
Bond to other sophisticated investors in $100,000 denominations until such a time as the CFD
taxes on developed property covers the bond debt service or a second series of CFD Bonds is
approved by the CFD and issued. This approach has been recommended by Columbia Capital
Management, LLC (the "Municipal Advisor") and Stifel, Nicolaus & Company, Incorporated
(the "Underwriter"). As the project develops, special taxes against the developed property will
increasingly cover all the bond debt service and reduce the undeveloped property development
risk. The master developer is confident in its development plan and reports it is in the process of
obtaining additional institutional equity funding to assure the success of the project.
The City, on behalf of the CFD and as part of the bond issuance, will covenant to undertake
judicial foreclosure proceedings in the event of delinquency in the payment of the special taxes.
The City has a similar covenant in the City's CFD 2002-1 Valencia Town Center Bonds. The
master developer will also provide ongoing disclosure to bondholders. There is no General Fund
obligation to pay bond debt service or funding for the Series 2020 Bonds. The Series 2020 Bonds
will have a bond reserve fund equal to $1.16 million and the expected bond debt service in 2020
is approximately $397,000 and in 2021 is approximately $817,000.
The Series 2020 Bonds are proposed to be sold through a negotiated sale by the Underwriter in
February with closing scheduled for February or March 2020. The final bond maturity is
September 1, 2050, just under 31 years. The final interest cost will depend on market interest
rates at time of sale. The currently estimated all -in true interest cost is 3.76 percent. The bond
markets have been relatively stable, but final bond interest rates may be higher or lower
depending on interest rates at time of sale.
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The public disclosures required under SB 450, effective January 1, 2018, are incorporated herein.
The estimates have been determined as of January 11, 2020. Specifically:
1) The all -in true interest cost of the Series 2020 Bonds, which means the rate necessary to
discount the amounts payable on the respective principal and interest payment dates to
the purchase price received for the new issue of Series 2020 Bonds is estimated to be
3. 76%.
2) The finance charge of the Series 2020 Bonds, which means the sum of all fees and
charges paid to third parties is estimated to be $610,190. Bond insurance premiums,
which lower interest cost in excess of the fees charged, are estimated to be $0. Such
insurance is not expected to be available.
3) The amount ofproceeds received by the public body for sale of the Series 2020 Bonds
less the finance charge of the Series 2020 Bonds described and any reserves or
capitalized interest paid or funded with proceeds of the Series 2020 Bonds is estimated to
be $17,494,210.
4) The total payment amount means the sum total of all payments the borrower will make to
pay debt service on the Series 2020 Bonds plus any finance charge of the Series 2020
Bonds not paid with the proceeds of the Series 2020 Bonds. The total payment amount
calculated to the final maturity of the Series 2020 Bonds is estimated to be $33, 572, 010.
Final sizing of the Series 2020 Bonds is expected to be $18.055 million and will be determined at
the pricing scheduled for early February of 2020.
Although the City formed the CFD, the bond issuances are not obligations of the City or its
entities and are solely obligations of the CFD. The finances and bonds of the CFD are unrelated
to, do not rely upon, and do not impact the credit rating of the City. Therefore, there is no risk to
the City AAA credit rating. This is also true of the City's other CFD bonds for the Valencia
Town Center. It is however the City's obligation to administer the CFD bonds.
The action today by the City Council, acting as the legislative body of the CFD, is to approve the
issuance of the first series of Bonds in an amount not to exceed $22 million, along with the
approval of related bond documents.
General Summary of Security: These Series 2020 Bonds are secured by the special taxes levied
on the properties in the CFD and, ultimately, by the properties themselves. In addition, a reserve
fund for the CFD is established from Series 2020 Bond proceeds. The reserve fund can be used
to pay debt service in the event that a property owner does not pay its special tax on time. Once
the reserve fund is depleted, the City has no obligation to advance funds to pay the Series 2020
Bonds. Each year special taxes will be levied against the properties in the CFD as part of the
County property tax bill_ In the event a property owner becomes delinquent on its property tax
payment, the CFD covenants to initiate foreclosure proceedings provided the delinquency for
such parcel is $25,000 or more, or against all delinquent parcels if the CFD receives special taxes
in an amount which is less than 95 percent of the total special taxes levied. This covenant is very
important to bond owners, as the property itself is the ultimate security for the bonds.
Fiscal Agent Agreement: Key legal document that lays out the legal structure and terms of the
financing. It specifies payment dates, maturity dates, interest rate, and transfer restrictions of the
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Series 2020 Bonds; revenues and accounts specifically pledged to the repayment of the Series
2020 Bonds; flow of funds; default and remedy provisions; additional bonds test, redemption and
defeasance provisions in the event the Series 2020 Bonds are prepaid; and covenants of the CFD
(including foreclosure covenants). It is drafted by Norton Rose Fulbright US LLP, (the "Bond
Counsel") and executed by the CFD and U.S. Bank National Association (the "Fiscal Agent").
Official Statement: This document describes the security and discloses potential risks to
prospective investors. It will generally describe the sources of payment for the Series 2020
Bonds, the nature of the improvement project, the value of the land ultimately securing the Series
2020 Bonds, economic and demographic characteristics of the CFD, and inherent known risk
factors associated with the security. The Preliminary Official Statement (often referred to as the
"POS") is distributed by the Underwriter to prospective investors prior to the bond sale so that
they can make informed purchase decisions. The POS should be as close to final as possible with
the actual terms of the pricing (interest rates and principal amounts) left necessarily blank. The
Final Official Statement (the "FOS") will be prepared shortly after the bond sale and must be
available in time for bond closing. While the City's legal counsel, consultants, and staff have
participated in preparing the POS, the CFD and City staff are ultimately responsible for ensuring
that the POS is accurate, contains no misleading information and does not omit any information
necessary to make the POS not misleading to investors. The POS and FOS are drafted by Bond
Counsel, acting as disclosure counsel, and the FOS is executed by the CFD.
Continuing Disclosure Certificate: This certificate outlines the updated information related to the
security that the CFD will agree to provide to the bond markets. Disclosure is required annually,
and on an exceptional basis for any major "material" event. This document is drafted by Bond
Counsel and executed by the CFD and Fiscal Agent. A Landowner Continuing Disclosure
Certificate will also be entered into by the master developer and the owner of the apartment
proj ect.
Bond Purchase Agreement: This contract is executed on the day of the bond sale, specifies the
actual principal amounts, interest rates, and prices at which the Series 2020 Bonds will be sold.
In it, Stifel Nicolaus & Co, Inc. commits to purchase the Series 2020 Bonds at closing at the
agreed upon prices and amounts subject to certain closing conditions. Closing conditions
generally relate to the execution and validity of all required documents and the absence of
material changes in the nature of the security. It is drafted by Underwriter's Counsel, reviewed
by Bond Counsel, and executed by the CFD and the underwriter.
Cooper Street Parking Facility
A portion of the proceeds of the Series 2020 Bonds will be used to acquire the Cooper Street
Parking Facility pursuant to the Funding and Acquisition Agreement approved on April 12,
2016. The Funding and Acquisition Agreement requires that the Cooper Street Structure be
completed prior to acquisition. The Cooper Street Parking Facility will be a City -owned public
parking garage with 84 dedicated spaces for the adjacent apartment complex and 529 public
parking spaces. The Cooper Street Parking Facility is within weeks of being completed and will
be acquired for a cost of approximately $15 million, following final review by the City's Public
Works department.
It is the intent to have the Vista Canyon's property owner association pay for ongoing
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maintenance and operation of the Cooper Street Parking Facility and any future public parking
structures financed by the CFD. An annual special tax for such services is included in the CFD
and would only be implemented in the unlikely event the association would not cover these
costs.
In connection with the upcoming acquisition of the Cooper Street Parking Facility, it is
recommended that the following agreements be approved and entered into by the City:
Parking Management Services Agreement: This document provides for the management,
operation, and maintenance of the Cooper Street Parking Facility. It specifies the term of the
agreement and any extensions, use of parking spaces for either required residential or public
parking spaces, sole responsibility of property owner's association (POA) for direct operating
costs, responsibilities of the City and the POA for insurance, budgets, audits, and required
management, operation and maintenance activities, and ancillary revenues. It was reviewed by
the City Attorney and bond counsel and will be executed by the POA and the City.
Parking Spaces Acquisition Agreement: This document provides for Vista Canyon Ranch to
purchase from the City certain perpetual easements at the Cooper Street Parking Facility for the
use of eighty-four (84) parking spaces required for residential parking for adjacent multi -family
uses at a purchase price equal to the construction cost of those 84 spaces. It also requires
payment of a proportionate share of operating and maintenance costs to the City if the POA is
not managing the Cooper Street Parking Facility. The attached "Easement Agreement For
Parking Spaces" will be recorded with the County Recorder. The agreement was reviewed by the
City Attorney and bond counsel and will be executed by the City as grantor and Vista Canyon
Ranch as grantee.
Easement Agreement for Solar Facilities and Community Identification Signage: This document
provides that the City grants to Vista Canyon Ranch certain easements at the Cooper Street
Parking Facility, which would enable Vista Canyon Ranch to construct, operate and maintain (i)
a photovoltaic system upon a portion of the Cooper Street Parking Facility and (ii) community
identification sgnage on the north and west exterior walls of the Cooper Street Parking Facility.
It was reviewed by the City Attorney and bond counsel, and will be executed by the City and
Vista Canyon Ranch and recorded with the County Recorder.
ALTERNATIVE ACTION
Other action as determined by the City Council.
FISCAL IMPACT
The City will be reimbursed by the CFD for required staff time and costs associated with the
formation and bond issuance. The City will receive approximately $2.65 million (15 percent) in
bond proceeds to be used towards the cost of the Vista Canyon Transit Center.
ATTACHMENTS
Resolution Approving Bond Issuance
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Resolution Approving Parking Agreements
Form of Fiscal Agent Agreement (available in City Clerk's Reading File)
Form of Preliminary Official Statement and Continuing Disclosure (available in City Clerk's
Reading File)
Form of Parking Spaces Acquisition Agreement (available in the City Clerk's Reading File)
Form of Easement Agreement for Solar and Signage (available in the City Clerk's Reading File)
Form of Parking Facility Management Agreement (available in the City Clerk's Reading File)
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RESOLUTION NO. 20-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA,
CALIFORNIA, ACTING AS THE LEGISLATIVE BODY OF CITY OF SANTA
CLARITA COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON),
AUTHORIZING THE ISSUANCE OF THE CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON) SPECIAL
TAX BONDS, 2020 SERIES AND THE EXECUTION AND DELIVERY OF A
FISCAL AGENT AGREEMENT, A CONTINUING DISCLOSURE CERTIFICATE, A
BOND PURCHASE AGREEMENT AND APPROVING A PRELIMINARY OFFICIAL
STATEMENT IN CONNECTION THEREWITH
WHEREAS, the City Council (the "Council") of the City of Santa Clarita,
California (the "City") has conducted proceedings under and pursuant to the Mello -Roos
Community Facilities Act of 1982, as amended (the "Act"), to form the City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon) (the "CFD"), and Zones 1 and 2
therein, to authorize the levy of special taxes upon the land within the CFD for certain services
and facilities which are necessary to meet increased demands placed upon the City as a result of
development or rehabilitation occurring within the CFD, and to issue bonds secured by the
facilities special taxes (the "Special Tax For Facilities") in an amount not to exceed $45,000,000,
the proceeds of which are to be used to finance the acquisition and/or construction of certain real
and other tangible property with an estimated useful life of five years or longer, including public
infrastructure facilities and other government facilities which the CFD is authorized by law to
construct, own or operate and that are necessary to meet increased demands placed upon the City
as a result of development occurring within the CFD, including but not limited to all or a portion
of up to three parking structures and a transit station and related costs including designs,
inspections, professional fees, and acquisition costs (collectively, the "Facilities"); and
WHEREAS, the Council, acting as the legislative body of the CFD, intends to
authorize the issuance of its initial series of bonds for the CFD designated "City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series" (the
"Bonds"); and
WHEREAS, there have been submitted to this Council certain documents
providing for the issuance of the Bonds and this Council, with the aid of its staff, has reviewed
said documents and found them to be in proper order; and
WHEREAS, in accordance with Government Code Section 53360.4, the
legislative body of the CFD determines that a negotiated sale of the Bonds to Stifel, Nicolaus &
Company, Incorporated (the "Underwriter") in accordance with the terms of the Bond Purchase
Agreement for the Bonds to be entered into by the CFD and the Underwriter will result in a
lower overall cost to the CFD than a public sale; and
WHEREAS, Integra Realty Resources, a state -certified real estate appraiser, as
defined in Section 11340 of the California Business and Professions Code, has delivered to the
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City an appraisal report, dated as of January 21, 2020 (the "Appraisal"), which was made in a
manner consistent with the City's policies for community facilities district financings; and
WHEREAS, the Appraisal states the value of the real property that is subject to
the special tax to pay debt service on the Bonds is $124,540,000, which is not less than 3.5 times
the sum of the maximum principal amount of the Bonds ($22,000,000) plus the principal amount
of all other bonds outstanding that are secured by a special tax levied pursuant to the Act on
property within the CFD ($0); and
WHEREAS, Senate Bill 450 (Chapter 625 of the 2017-2018 Session of the
California Legislature) (" SB 450") requires that the governing body of a public body obtain,
prior to authorizing the issuance of bonds with a term of greater than 13 months, good faith
estimates of the following information in a meeting open to the public: (a) the true interest cost
of the bonds, (b) the sum of all fees and charges paid to third parties with respect to the bonds,
(c) the amount of proceeds of the bonds expected to be received net of the fees and charges paid
to third parties and any reserves or capitalized interest paid or funded with proceeds of the bonds,
and (d) the sum total of all debt service payments on the bonds calculated to the final maturity of
the bonds plus the fees and charges paid to third parties not paid with the proceeds of the bonds;
and
WHEREAS, all conditions, things and acts required to exist, to have happened
and to have been performed precedent to and in the issuance of said Bonds and the levy of said
Special Taxes For Facilities as contemplated by this Resolution and the documents referred to
herein, exist, have happened and have been performed in due time, form and manner as required
by the laws of the State of California, including the Act.
NOW, THEREFORE, the City Council of the City of Santa Clarita, California,
acting as the legislative body of the City of Santa Clarita Community Facilities District No.
2016-1 (Vista Canyon), does hereby resolve as follows:
SECTION 1. Approval and Authorization of Initial Series of Bonds. The Council
hereby authorizes the issuance of the Bonds in an amount not to exceed $22,000,000 for the
purpose of financing a portion of the Facilities, funding of a debt service reserve account,
funding capitalized interest for a period not to exceed 24 months and paying costs of issuance
related to the Bonds.
SECTION 2. Approval of Fiscal Agent Agreement. The Council hereby approves
the Fiscal Agent Agreement in substantially the form presented to this Council and on file with
the City Clerk. The Mayor, the City Manager, Assistant City Manager or City Treasurer (each, a
"Responsible Officer") is hereby authorized to execute the Fiscal Agent Agreement with such
revisions, amendments and completions as shall be approved by any Responsible Officer
executing the same, with the advice of Bond Counsel and approval of City Attorney, such
approval to be conclusively evidenced by the execution and delivery thereof.
SECTION 3. Approval of Continuing Disclosure Certificate. The Council hereby
approves the Continuing Disclosure Certificate in substantially the form presented to this
Council and on file with the City Clerk. Any Responsible Officer is hereby authorized to
execute the Continuing Disclosure Certificate with such revisions, amendments and completions X
as shall be approved by any Responsible Officer executing the same, with the advice of Bond Q
Counsel and approval of City Attorney, such approval to be conclusively evidenced by the v
execution and delivery thereof. ow.
SECTION 4. Approval of Preliminary and Final Official Statement. The Council
hereby approves the Preliminary Official Statement relating to the Bonds, substantially in the
form presented to this Council and on file with the City Clerk, with such revisions, amendments
and completions as shall be approved by any Responsible Officer with the advice of Bond
Counsel or Disclosure Counsel and City Attorney, in order to make the Preliminary Official
Statement final as of its date, except for the omission of certain information, as permitted by
Section 240.15c2-12(b)(1) of Title 17 of the Code of Federal Regulations ("Rule 15c2-12"), and
any certificate relating to the finality of the Preliminary Official Statement under Rule 15c2-12.
Any Responsible Officer is authorized and directed to execute and deliver a final Official
Statement in the form of the Preliminary Official Statement, with such additions and changes as
may be approved by Bond Counsel or Disclosure Counsel and any Responsible Officer
executing the same, such approval to be conclusively evidenced by the execution and delivery
thereof.
SECTION 5. Approval of Bond Purchase Agreement. The Council hereby
approves the Bond Purchase Agreement in substantially the form presented to this Council and
on file with the City Clerk. Any Responsible Officer is hereby authorized to execute the Bond
Purchase Agreement with such revisions, amendments and completions as shall be approved by
any Responsible Officer executing the same, with the advice of Bond Counsel, such approval to
be conclusively evidenced by the execution and delivery thereof, provided that, the Bond
Purchase Agreement shall provide for a true interest cost (including original issue discount
shown) not greater than 5%, and an underwriter's discount not greater than 1.1% of the principal
amount of Bonds.
SECTION 6. Good Faith Estimates. In accordance with SB 450, good faith
estimates of the following have been presented to this meeting: (a) the true interest cost of the
Bonds, (b) the sum of all fees and charges paid to third parties with respect to the Bonds, (c) the
amount of proceeds of the Bonds expected to be received net of the fees and charges paid to third
parties and any reserves or capitalized interest paid or funded with proceeds of the Bonds, and
(d) the sum total of all debt service payments on the Bonds calculated to the final maturity of the
Bonds plus the fees and charges paid to third parties not paid with the proceeds of the Bonds.
SECTION 7. Official Actions. Each Responsible Officer is hereby authorized
and directed, for and in the name and on behalf of the City, to do any and all things and take any
and all other actions, including the obtaining of municipal bond insurance and reserve account
surety, and the publication of any notices necessary or desirable in connection with the sale of
the Bonds and execution and delivery of any and all assignments, certificates, requisitions,
agreements, notices, consents, instruments of conveyance, warrants and other documents, which
they, or any of them, deem necessary or advisable in order to consummate the lawful issuance
and sale of the Bonds and the consummation of the transactions as described herein.
SECTION 8. Certification and Effective Date. The City Clerk shall certify to the x
adoption of this resolution. This resolution shall take effect immediately upon its adoption.
PASSED, APPROVED, AND ADOPTED this 28th day of January 2020.
MAYOR
ATTEST:
CITY CLERK
DATE:
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF SANTA CLARITA )
I, Mary Cusick, City Clerk of the City of Santa Clarita, do hereby certify that the
foregoing Resolution No. 20- was duly adopted by the City Council of the City of Santa Clarita,
acting as the legislative body of the City of Santa Clarita Community Facilities District No.
2016-1 (Vista Canyon) at a regular meeting thereof, held on the 28th day of January 2020, by the
following vote:
AYES: COUNCIL,MEMBERS:
NOES: COUNCIL,MEMBERS:
ABSENT: COUNCIL,MEMBERS:
CITY CLERK
RESOLUTION NO. 20-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CLARITA,
CALIFORNIA, APPROVING THE EXECUTION AND DELIVERY OF A PARKING
MANAGEMENT SERVICES AGREEMENT, PARKING SPACES ACQUISITION
AGREEMENT AND EASEMENT AGREEMENT FOR SOLAR FACILITIES AND
COMMUNITY IDENTIFICATION SIGNAGE IN CONNECTION WITH THE
COOPER STREET PARKING FACILITY
WHEREAS, the Vista Canyon project was approved by City Council (the
"Council") of the City of Santa Clarita, California (the "City") on April 26, 2011; and
WHEREAS, on April 12, 2016, the Council approved a Funding and Acquisition
Agreement (the "Funding and Acquisition Agreement") in which the master developer of the
Vista Canyon project agreed to construct certain parking facilities and the City agreed to acquire
such parking facilities using proceeds of bonds issued by a proposed community facilities district
to be formed by the City; and
WHEREAS, following a public hearing and election, on April 12, 2016, a
community facilities district was formed, designated "City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon)" (the "CFD"), and the CFD was authorized to issue bonds
secured by special taxes within the CFD to fund up to three parking structures and a portion of a
multi -modal transit station, totaling up to $45 million; and
WHEREAS, the CFD is preparing to issue the first series of bonds (the Series
2020 Bonds") in an amount not to exceed $22 million, to acquire the first parking structure
pursuant to the Funding and Acquisition Agreement, which will be a City -owned public parking
garage with 84 dedicated spaces for the adjacent apartment complex and 529 public parking
spaces (the "Cooper Street Parking Facility"); and
WHEREAS, there have been submitted to this Council certain documents
providing for management of the Cooper Street Parking Facility, the acquisition of the 84
residential spaces and the easement for solar facilities and signage, and this Council, with the aid
of its staff, has reviewed said documents and found them to be in proper order.
NOW, THEREFORE, the City Council of the City of Santa Clarita, California,
does hereby resolve as follows:
SECTION 1. Approval of Parking Management Services Agreement. The
Council hereby approves the Parking Management Services Agreement for Parking Structure 1
(the "Parking Management Services Agreement") in substantially the form presented to this
Council and on file with the City Clerk. The Mayor, the City Manager, Assistant City Manager,
Director of Administrative Services or City Treasurer (each, a "Responsible Officer") is hereby
authorized to execute the Parking Management Services Agreement with such revisions,
amendments and completions as shall be approved by any Responsible Officer executing the
same, with the advice of City Attorney, such approval to be conclusively evidenced by the
execution and delivery thereof.
SECTION 2. Approval of Parking Spaces Acquisition Agreement. The Council
hereby approves the Parking Spaces Acquisition Agreement in substantially the form presented
to this Council and on file with the City Clerk. Any Responsible Officer is hereby authorized to
execute the Parking Spaces Acquisition Agreement with such revisions, amendments and
completions as shall be approved by any Responsible Officer executing the same, with the
advice of City Attorney, such approval to be conclusively evidenced by the execution and
delivery thereof.
SECTION 3. Approval of Easement Agreement for Solar Facilities and
Community Identification Side. The Council hereby approves the Easement Agreement for
Solar Facilities and Community Identification Signage in substantially the form presented to this
Council and on file with the City Clerk. Any Responsible Officer is hereby authorized to
execute the Easement Agreement for Solar Facilities and Community Identification Signage with
such revisions, amendments and completions as shall be approved by any Responsible Officer
executing the same, with the advice of City Attorney, such approval to be conclusively
evidenced by the execution and delivery thereof.
SECTION 4. Official Actions. Each Responsible Officer is hereby authorized
and directed, for and in the name and on behalf of the City, to do any and all things and take any
and all other actions, including the execution and delivery of any and all assignments,
certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and
other documents, which they, or any of them, deem necessary or advisable in order to
consummate the transactions as described herein.
SECTION 5. Certification and Effective Date. The City Clerk shall certify to the
adoption of this resolution. This resolution shall take effect immediately upon its adoption.
ATTEST:
CITY CLERK
DATE:
PASSED, APPROVED, AND ADOPTED this 28th day of January 2020.
2
MAYOR
STATE OF CALIFORNIA )
COUNTY OF LOS ANGELES ) ss.
CITY OF SANTA CLARITA )
I, Mary Cusick, City Clerk of the City of Santa Clarita, do hereby certify that the
foregoing Resolution No. 20- was duly adopted by the City Council of the City of Santa Clarita
at a regular meeting thereof, held on the 281h day of January 2020, by the following vote:
AYES: COUNCIL,MEMBERS:
NOES: COUNCIL,MEMBERS:
ABSENT: COUNCIL,MEMBERS:
CITY CLERK
1/21/20
FISCAL AGENT AGREEMENT
BETWEEN
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON)
AND
U.S. BANK NATIONAL ASSOCIATION,
as Fiscal Agent
DATED AS OF FEBRUARY 1, 2020
RELATING TO
$[PRINCIPAL AMOUNT]
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON)
SPECIAL TAX BONDS, 2020 SERIES
42831645.7
TABLE OF CONTENTS
ARTICLE I DEFINITIONS
Section 1.1. Definitions
ARTICLE II GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1.
Amount, Issuance, Purpose and Nature of Bonds .......................
Section 2.2.
Type and Nature of Bonds..........................................................
Section 2.3.
Equality of Bonds and Pledge of Special Taxes .........................
Section 2.4.
Description of Bonds; Interest Rates ..........................................
Section 2.5.
Place and Form of Payment........................................................
Section 2.6.
Form of Bonds............................................................................
Section 2.7.
Execution and Authentication.....................................................
Section 2.8.
Bond Register.............................................................................
Section 2.9.
Registration of Exchange or Transfer .........................................
Section 2.10.
Mutilated, Lost, Destroyed or Stolen Bonds ...............................
Section 2.11.
Validity of Bonds........................................................................
Section 2.12.
Book -Entry System.....................................................................
Section 2.13.
Representation Letter..................................................................
Section 2.14.
Transfers Outside Book -Entry System .......................................
Section 2.15.
Payments to the Nominee...........................................................
Section 2.16.
Initial Security Depository and Nominee ...................................
ARTICLE III CREATION OF FUNDS AND APPLICATION OF SPECIAL TAXES
Section 3.1.
Creation of Funds..........................................................................
Section 3.2
Application of 2020 Bond Proceeds .............................................
Section 3.3.
Deposits to and Disbursements from Special Tax Fund ...............
Section 3.4.
Administrative Expense Fund .......................................................
Section 3.5.
Interest Account and Principal Account of the Special Tax Fund
Section 3.6.
Redemption Account of the Special Tax Fund .............................
Section 3.7.
Reserve Account of the Special Tax Fund ....................................
Section3.8.
Surplus Fund.................................................................................
Section 3.9.
Acquisition and Construction Fund ..............................................
Section 3.10
Costs of Issuance Fund.................................................................
Section3.11.
Investments...................................................................................
Section 3.12
Additional Series of Bonds...........................................................
ARTICLE IV REDEMPTION OF BONDS
Page
1
19
20
Section 4.1. Redemption of Bonds.........................................................................................21
Section 4.2. Selection of Bonds for Redemption....................................................................23
Section 4.3. Notice of Redemption.........................................................................................23
Section 4.4. Partial Redemption of Bonds..............................................................................24
Section 4.5. Effect of Notice and Availability of Redemption Money...................................24
ARTICLE V COVENANTS AND WARRANTY
Section 5.1. Warranty.
Section 5.2. Covenants
25
25
42831645.7
TABLE OF CONTENTS
(continued)
Page
ARTICLE VI AMENDMENTS TO FISCAL AGENT AGREEMENT
Section 6.1.
Supplemental Fiscal Agent Agreements or Orders Not Requiring
BondownerConsent............................................................................................30
Section 6.2.
Supplemental Fiscal Agent Agreements or Orders Requiring Bondowner
Consent...............................................................................................................
31
Section 6.3.
Notation of Bonds; Delivery of Amended Bonds...............................................32
ARTICLE VII FISCAL AGENT
Section7.1.
Fiscal Agent........................................................................................................32
Section 7.2.
Removal of Fiscal Agent....................................................................................33
Section 7.3.
Resignation of Fiscal Agent................................................................................33
Section 7.4.
Compensation and Liability of Fiscal Agent......................................................33
Section 7.5.
Merger or Consolidation.....................................................................................34
ARTICLE VIII EVENTS
OF DEFAULT; REMEDIES
Section 8.1.
Events of Default................................................................................................35
Section 8.2.
Remedies of Owners...........................................................................................35
ARTICLE IX DEFEASANCE
Section9.1.
Defeasance..........................................................................................................36
ARTICLE X MISCELLANEOUS
Section 10.1.
Cancellation of Bonds.........................................................................................37
Section 10.2.
Execution of Documents and Proof of Ownership.............................................38
Section 10.3.
Unclaimed Moneys.............................................................................................38
Section 10.4.
Provisions Constitute Contract...........................................................................39
Section 10.5.
Future Contracts..................................................................................................39
Section 10.6.
Further Assurances.............................................................................................39
Section10.7.
Severability.........................................................................................................39
Section10.8.
Notices................................................................................................................39
Section 10.9.
General Authorization.........................................................................................40
Section 10.10.
Execution in Counterparts..................................................................................40
ExhibitA — Form of Bond......................................................................................................................
A-1
ExhibitB — Requisition No. 1..................................................................................................................B-1
42831645.7 11
FISCAL AGENT AGREEMENT
THIS FISCAL AGENT AGREEMENT, dated as of February 1, 2020, between the City of Santa
Clarita Community Facilities District No. 2016-1 (Vista Canyon) and U.S. Bank National Association, as
fiscal agent (the "Fiscal Agent") governs the terms of the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series.
RECITALS:
WHEREAS, the City Council of the City of Santa Clarita (the "Council'), located in Los Angeles
County, California, acting as the legislative body of the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon) (the "CFD"), has heretofore undertaken proceedings and declared the
necessity to issue bonds pursuant to the terms and provisions of the Mello -Roos Community Facilities
Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the
State of California (the "Act"); and
WHEREAS the qualified electors within the CFD have approved the levy of a special tax for
facilities and the issuance of bonds by the CFD and the Council has authorized the issuance of bonds in
one or more series, pursuant to the Act, in an aggregate principal amount not to exceed $45,000,000; and
WHEREAS, the Council intends over time to accomplish the financing of the acquisition and/or
construction of certain real and other tangible property with an estimated useful life of five years or
longer, including public infrastructure facilities and other governmental facilities which the CFD is
authorized by law to construct, own or operate and that are necessary to meet increased demands placed
upon the City as a result of development occurring within the CFD, including but not limited to all or a
portion of up to three parking structures and a transit station and related costs including designs,
inspections, professional fees, and acquisition costs (collectively, the "Facilities") through the issuance of
one or more series of bonds designated as the "City of Santa Clarita Community Facilities District No.
2016-1 (Vista Canyon) Special Tax Bonds" (the "Bonds"); and
WHEREAS, the Council intends to finance a portion of the Facilities through the issuance of an
initial series of bonds in an aggregate principal amount of $[principal amount] designated as the "City of
Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series"
(the "2020 Bonds"); and
WHEREAS, all requirements of the Act for the issuance of the 2020 Bonds have been satisfied;
NOW, THEREFORE, in order to establish the terms and conditions upon and subject to which
the Bonds are to be issued, and in consideration of the premises and of the mutual covenants contained
herein and of the purchase and acceptance of the Bonds by the Owners thereof, and for other valuable
consideration, the receipt of which is hereby acknowledged, the CFD does hereby covenant and agree, for
the benefit of the Owners of the Bonds (as defined herein) which may be issued hereunder from time to
time, as follows:
ARTICLE I
DEFINITIONS
Section I.I. Definitions. Unless the context requires, the following terms shall have the
following meanings:
42831645.7
"Accredited Investor" means any accredited investor as defined in Rule 501 promulgated under
the Securities Act of 1933, as amended.
"Acquisition and Construction Fund" means the fund by such name created and established
pursuant to Section 3.1 hereof.
"Act" means the Mello -Roos Community Facilities Act of 1982, as amended, Sections 53311 et
seq. of the California Government Code.
"Administrative Expense Fund" means the fund by such name created and established pursuant to
Section 3.1 hereof and held by the CFD.
"Administrative Expense Requirement" means an amount equal to $25,000 for Fiscal Year 2019-
20 and escalating 2% each Fiscal Year thereafter, or such lesser amount as may be designated in a Written
Request of the CFD.
"Administrative Expenses" means the administrative costs with respect to the calculation and
collection (including any foreclosure actions) of the Special Taxes, including all attorneys' fees and other
costs related thereto, the fees and expenses of the Fiscal Agent, any fees for credit enhancement for the
Bonds which are not otherwise paid as Costs of Issuance, any costs related to the CFD's compliance with
State and federal laws requiring continuing disclosure of information concerning the Bonds and the CFD,
and any other costs otherwise incurred by the City's staff on behalf of the CFD in order to carry out the
purposes of the CFD as set forth in the Resolution of Formation and any obligation of the CFD hereunder.
"Annual Debt Service" means the principal amount of any Outstanding Bonds payable in a Bond
Year either at maturity or pursuant to a Sinking Fund Payment plus any interest payable on any
Outstanding Bonds in such Bond Year, if the Bonds are retired as scheduled.
"Appraiser" means any State certified appraiser selected by the CFD who is a designated MAI
member of the Appraisal Institute and performs appraisals in accordance with the requirements of
Appraisal Standards for Land Secured Financing by California Debt and Investment Advisory
Commission.
"Authorized Denomination" means (a) initially, and until the Trigger Event Date, $100,000 or
any integral multiple of $5,000 in excess thereof, and (b) on and after the Trigger Event Date, $5,000 or
any integral multiple thereof.
"Authorized Investments" means any of the following which at the time of investment are legal
investments under the laws of the State for the moneys proposed to be invested therein:
(1) Direct obligations of the United States of America (including obligations issued or held
in book -entry form on the books of the Department of the Treasury, and CATS and TIGRS) or
obligations the principal of and interest on which are unconditionally guaranteed by the United States of
America ("Direct Obligations").
(2) Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any
of the following federal agencies and provided such obligations are backed by the full faith and credit of
the United States of America (stripped securities are only permitted if they have been stripped by the
agency itself):
42831645.7
U.S. Export -Import Bank ("Eximbank")
Direct obligations or fully guaranteed certificates of beneficial ownership
Farmers Home Administration ("FmHA")
Certificates of beneficial ownership
Federal Financing Bank
Federal Housing Administration Debentures ("FHA")
General Services Administration
Participation certificates
Government National Mortgage Association ("GNMA" or "Ginnie Mae")
GNMA-guaranteed mortgage -backed bonds
GNMA-guaranteed pass -through obligations
U.S. Maritime Administration
Guaranteed Title XI financing
U.S. Department of Housing and Urban Development (HUD)
Project Notes
Local Authority Bonds
New Communities Debentures - U.S. government guaranteed debentures
U.S. Public Housing Notes and Bonds - U.S. government guaranteed
public housing notes and bonds
(3) Bonds, debentures, notes or other evidence of indebtedness issued or guaranteed by any
of the following non -full faith and credit U.S. government agencies (stripped securities are only permitted
if they have been stripped by the agency itself:
Federal Home Loan Bank System
Senior debt obligations
Federal Home Loan Mortgage Corporation ("FHLMC" or "Freddie Mac")
Participation certificates
Senior debt obligations
42831645.7
Federal National Mortgage Association ("FNMA" or "Fannie Mae")
Mortgage -backed securities and senior debt obligations
Student Loan Marketing Association ("SLMA" or "Sallie Mae")
Senior debt obligations
Resolution Funding Corp. ("REFCORP") obligations
Farm Credit System CM. - Consolidated system -wide bonds and notes
(4) Money market funds registered under the Federal Investment Company Act of 1940,
whose shares are registered under the Securities Act of 1933, and having a rating by Standard & Poor's of
AAAm-G, AAAm or AAm, and, if rated by Moody's, rated Aaa, Aal or Aa2 (including those of the
Fiscal Agent and its affiliates) excluding funds with a floating net asset value.
(5) Certificates of deposit secured at all times by collateral described in (1) and/or (2) above.
Such certificates must be issued by commercial banks, savings and loan associations or mutual savings
banks. The collateral must be held by a third party and the Bondholders must have a perfected first
security interest in the collateral.
(6) Certificates of deposit, savings accounts, deposit accounts or money market deposits
which are fully insured by FDIC or which are with a bank rated AA or better by Standard & Poor's and
Aa or better by Moody's (including those of the Fiscal Agent and its affiliates).
(7) Investment Agreements with any corporation, including banking or financial institutions,
provided that
(a) the long-term debt of the provider of any such investment agreement is rated, at
the time of investment, at least "AA" and "Aa" by the Rating Agency (without regard to
gradations of plus or minus within such category), and
(b) any such investment agreement is collateralized with United States Treasury or
agency obligations which at least equal 102% of the principal amount invested thereunder, and
(c) any such agreement shall include a provision to the effect that, in the event the
long-term debt rating of the provider of such agreement is downgraded below "AA-" or below
"Aa" by the applicable Rating Agency, the CFD has the right to withdraw or cause the Fiscal
Agent to withdraw all funds invested in such agreement and thereafter to invest such funds
pursuant to this Fiscal Agent Agreement.
(8) Commercial paper rated, at the time of purchase, "Prime - 1" by Moody's and "A-1" or
better by Standard & Poor's.
(9) Bonds or notes issued by any state or municipality which are rated by Moody's and
Standard & Poor's in one of the two highest rating categories assigned by such agencies.
(10) Federal funds or bankers acceptances with a maximum term of one year of any bank
which has an unsecured, uninsured or unguaranteed obligation rating of "Prime - 1" or "A3" or better by
Moody's and "A- I" or "A" or better by Standard & Poor's.
42831645.7
(11) Repurchase agreements collateralized by Direct Obligations, GNMAs, FNMAs or
FHLMCs with any registered broker/dealer subject to the Securities Investors' Protection Corporation
jurisdiction or any commercial bank insured by the FDIC, if such broker/dealer or bank has an uninsured,
unsecured and unguaranteed obligation rated "P-1" or "A3" or better by Moody's, and "A-1" or "A-" by
Standard & Poor's; provided:
(a) a master repurchase agreement or specific written repurchase agreement governs
the transaction; and
(b) the securities are held free and clear of any lien by the Fiscal Agent or an
independent third party acting solely as agent ("Agent") for the Fiscal Agent, and such third party
is (1) a Federal Reserve Bank, (11) a bank which is a member of the Federal Deposit Insurance
Corporation and which has combined capital, surplus and undivided profits of not less than $50
million, or (111) a bank approved in writing for such purpose by Financial Guaranty Insurance
Company, and the Fiscal Agent shall have received written confirmation from such third party
that it holds such securities, free and clear of any lien, as agent for the Fiscal Agent; and
(c) a perfected first security interest under the Uniform Commercial Code, or book
entry procedures prescribed at 31 C.F.R. 306.1 et seq. or 31 C.F.R. 350.0 et seq. in such securities
is created for the benefit of the Fiscal Agent; and
(d) the repurchase agreement has a term of 180 days or less, and the Fiscal Agent or
the Agent will value the collateral securities no less frequently than weekly and will liquidate the
collateral securities if any deficiency in the required collateral percentage is not restored within
two business days of such valuation; and
(e) the fair market value of the securities in relation to the amount of the repurchase
obligation, including principal and interest, is equal to at least 103%.
(12) Local Agency Investment Fund ("LAIF") of the State of California.
(13) Shares in a common law trust, commonly referred to as CAMP, established pursuant to
Title 1, Division 7, Charter 5 of the Government Code of the State which invests exclusively in
investments permitted by Section 53601 of Title 5, Division 2, Chapter 4 of the Government Code of the
State, as it may be amended;
(14) The commingled investment fund of the County of Los Angeles, California, which is
administered in accordance with the investment policy of the County as established by the County
Auditor -Controller -Treasurer -Tax Collector, as permitted by Section 53601 of the Government Code of
the State, copies of which policy are available upon written request to said County Auditor -Controller -
Treasurer -Tax Collector;
(15) Any other investment which the CFD is permitted by law to make.
"Authorized Representative of the CFD" means the Mayor, City Manager, City Treasurer, or any
other person or persons designated by the Council and authorized to act on behalf of the CFD by a written
certificate signed on behalf of the CFD by the Mayor, the City Manager or the City Treasurer and
containing the specimen signature of each such person.
"Beneficial Owner" means each owner of a beneficial ownership interest in the Bonds purchased
through Participants.
42831645.7
"Bond Counsel" means Norton Rose Fulbright US LLP, or any other firm of attorneys selected by
the CFD of nationally recognized standing in matters pertaining to the tax-exempt nature of interest on
bonds issued by states and their political subdivisions duly admitted to the practice of law before the
highest court of any state of the United States of America or the District of Columbia.
"Bond Register" means the books which the Fiscal Agent shall keep or cause to be kept on which
the registration and transfer of the Bonds shall be recorded.
"Bondowner" or "Owner" means the person or persons in whose name or names any Bond is
registered.
"Bonds" means any of the City of Santa Clarita Community Facilities District No. 2016-1 (Vista
Canyon) Special Tax Bonds authorized by, and at any time Outstanding under, this Fiscal Agent
Agreement pursuant to Section 2.1 and Section 3.12.
"Bond Year" means for each Series of Bonds, the twelve month period commencing on
September 2 of each year and ending on September 1 of the following year, except that the first Bond
Year for any Series of Bonds shall begin on the Delivery Date of such Series and end on the first
September 1 which is not more than 12 months after the Delivery Date of such Series of Bonds.
"Business Day" means a day which is not a Saturday or Sunday or a day of the year on which
banks in New York, New York, Los Angeles, California, or the city where the Corporate Trust Office is
located, are not required or authorized to remain closed.
"CDIAC" means the California Debt and Investment Advisory Commission of the office of the
State Treasurer of the State of California or any successor agency or bureau thereto.
"Certificate of Authorized Representative of the CFD" means a written certificate or warrant
request executed by an Authorized Representative of the CFD.
"CFD" means the City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
established pursuant to the Act and the Resolution of Formation.
"CFD Value" means the market value, as of the date of the appraisal described below and/or the
date of the most recent County real property tax roll, as applicable, of the subject parcels of real property
in the CFD subject to the levy of the Special Taxes, including the value of the then existing improvements
and any facilities to be constructed or acquired with any amounts then on deposit in the Acquisition and
Construction Fund and with the proceeds of any proposed Series of Bonds, as determined with respect to
any parcel or group of parcels by reference to (1) an appraisal performed within three (3) months of the
date of issuance of any proposed Series of Bonds by the Appraiser, or (11) in the alternative or in
combination with the appraisal, the assessed value of the subject parcels and improvements thereon as
shown on the then current County real property tax roll available to the Treasurer. It is expressly
acknowledged that, in determining the CFD Value, the CFD may rely on an appraisal to determine the
value of some or all of the parcels in the CFD and/or the most recent County real property tax roll as to
the value of some or all of the parcels in the CFD; provided that any parcel or which the assessed
valuation is then under appeal must be valued based on an appraisal. Neither the CFD nor the Treasurer
shall be liable to the Owners, underwriters or any other person or entity in respect of any appraisal
provided for purposes of this definition or by reason of any exercise of discretion made by any Appraiser
pursuant to this definition.
"City" means the City of Santa Clarita, California
42831645.7
"Code" means the Internal Revenue Code of 1986 and any Regulations, rulings, judicial
decisions, and notices, announcements, and other releases of the United States Treasury Department or
Internal Revenue Service interpreting and construing it.
"Continuing Disclosure Certificate" means with respect to a Series requiring an undertaking
regarding disclosure under Rule 15c2-12, the Continuing Disclosure Certificate, dated the date of
issuance of such Series, executed by the CFD and acknowledged by a Dissemination Agent, as the same
may be supplemented, modified or amended in accordance with its terms.
"Corporate Trust Office" means the corporate trust office of the Fiscal Agent at Los Angeles,
California, or such other office designated from time to time by the Fiscal Agent in writing to the CFD.
"Costs of Issuance" in respect of a Series, means the costs and expenses incurred in connection
with the issuance and sale of that Series, including the acceptance and initial annual fees and expenses of
the Fiscal Agent and its counsel, legal fees and expenses, costs of printing the Bonds of such Series and
the preliminary and final official statements for such Series, fees of financial consultants and all other
related fees and expenses, as set forth in a Certificate of Authorized Representative of the CFD.
"Costs of Issuance Fund" means the fund by such name created and established pursuant to
Section 3.1 hereof.
"Council" means the City Council of the City of Santa Clarita.
"County" means the County of Los Angeles.
"Defeasance Securities" means any of the following:
(a) Cash
(b) United States Treasury Certificates, Notes and Bonds (including State and Local
Government Series -- "SLGS")
(c) Direct obligations of the U.S. Treasury which have been stripped by the U.S.
Treasury itself, e.g., CATS, TIGRS and similar securities.
(d) The interest component of Resolution Funding Corp. strips which have been
stripped by request to the Federal Reserve Bank of New York and are in book -entry form.
(e) Pre -refunded municipal bonds rated "Aaa" by Moody's and "AAA" by Standard
& Poor's.
(f) Obligations issued by the following agencies which are backed by the full faith
and credit of the United States:
U.S. Export -Import Bank - direct obligations or fully guaranteed certificates of beneficial
ownership
Farmers Home Administration - certificates of beneficial ownership
Federal Financing Bank
General Services Administration - participation certificates
42831645.7 7
U.S. Maritime Administration - guaranteed Title XI financing
U.S. Department of Housing and Urban Development (HUD) - Project Notes, Local
Authority Bonds, New Communities Debentures - U.S. government guaranteed
debentures, U.S. Public Housing Notes and Bonds - U.S. government guaranteed public
housing notes and bonds.
"Delivery Date" in respect of a Series, means the date on which the bonds of such Series were
issued and delivered to the initial purchasers thereof.
"Developed Property" means Developed Property as defined in the RMA.
"Developer" means Vista Canyon Ranch, LLC, or its successor, from whom the CFD shall
acquire the parking structures portion of the 2020 Project.
"Dissemination Agent" means, with respect to each Series requiring an undertaking regarding
disclosure under Rule 15c2-12(b)(5), the dissemination agent under the Continuing Disclosure Certificate
delivered in connection with that Series, or any successor dissemination agent designated in writing by
the CFD and that has acknowledged a Continuing Disclosure Certificate with the CFD.
"Fiscal Agent" means U.S. Bank National Association, a national banking association duly
organized and existing under and by virtue of the laws of the United States of America, at its corporate
trust office in Los Angeles, California, and its successors or assigns, or any other bank or trust company
which may at any time be substituted in its place as provided in Sections 7.2 or 7.3 and any successor
thereto.
"Fiscal Agent Agreement" means this Fiscal Agent Agreement, together with any Supplemental
Fiscal Agent Agreement approved pursuant to Article VI hereof.
"Fiscal Year" means the period beginning on July 1 of each year and ending on the next
following June 30.
"Independent Financial Consultant" means a financial consultant or special tax consultant or firm
of either such consultants generally recognized to be well qualified in the financial consulting or special
tax consulting field, appointed and paid by the CFD, who, or each of whom:
(1) is, in fact, independent and not under the domination of the CFD;
(2) does not have any substantial interest, direct or indirect, in the CFD; and
(3) is not connected with the CFD as a member, officer or employee of the CFD, but who
may be regularly retained to make annual or other reports to the CFD.
"Interest Account" means the account by such name created and established in the Special Tax
Fund pursuant to Section 3.1 hereof.
"Interest Payment Date" means each March 1 and September 1, commencing September 1, 2020,
provided, however, that, if any such day is not a Business Day, interest up to the Interest Payment Date
will be paid on the Business Day next succeeding such date.
42831645.7
"Investment Agreement" means one or more agreements for the investment of funds of the CFD
complying with the criteria therefor as set forth in Subsection (7) of the definition of Authorized
Investments herein.
"Landowner" means any property owner of land in the CFD responsible in the aggregate for 20%
or more of the annual special taxes levied in the CFD and subject to continuing disclosure requirements
pursuant to a Landowner Continuing Disclosure Certificate.
"Landowner Continuing Disclosure Certificate" means the Landowner Continuing Disclosure
Certificate, dated the Delivery Date, as originally executed by a Landowner, and as it may be amended
from time to time in accordance with the terms thereof.
"Maximum Annual Debt Service" means the maximum sum obtained for any Bond Year prior to
the final maturity of the Bonds by adding the following for each Bond Year:
(1) the principal amount of all Outstanding Bonds payable in such Bond Year either at
maturity or pursuant to a Sinking Fund Payment; and
(2) the interest payable on the aggregate principal amount of all Bonds Outstanding in such
Bond Year if the Bonds are retired as scheduled.
"Moody's" means Moody's Investors Service, its successors and assigns.
"Nominee" means the nominee of the Security Depository, which may be the Security
Depository, as determined from time to time pursuant to Section 2.17 hereof.
"Ordinance" means Ordinance No. 16-06 adopted by the Council on April 26, 2016, as amended
from time to time, pursuant to which the Special Taxes are authorized.
"Outstanding" or "Outstanding Bonds" means all Bonds theretofore issued by the CFD, except:
(1) Bonds theretofore cancelled or surrendered for cancellation in accordance with Section
10.1 hereof,
(2) Bonds for payment or redemption of which monies shall have been theretofore deposited
(whether upon or prior to the maturity or the redemption date of such Bonds), provided that, if such
Bonds are to be redeemed prior to the maturity thereof, notice of such redemption shall have been given
as provided in this Fiscal Agent Agreement; and
(3) Bonds which have been surrendered to the Fiscal Agent for transfer or exchange pursuant
to Section 2.9 hereof or for which a replacement has been issued pursuant to Section 2.10 hereof.
"Participants" shall mean those broker -dealers, banks and other financial institutions from time to
time for which the Security Depository holds Bonds as securities depository.
"Person" means natural persons, firms, corporations, partnerships, associations, trusts, public
bodies and other entities.
"Principal Account" means the account by such name in the Special Tax Fund created and
established pursuant to Section 3.1 hereof.
42831645.7 9
"Project" means those public facilities described in the Resolution of Formation which are to be
acquired or constructed within the CFD, including all engineering, planning and design services and other
incidental expenses related to such facilities and other facilities, if any, authorized by the qualified
electors within the CFD from time to time.
"Project Costs" means the amounts necessary to finance the Project, to create and replenish any
necessary reserve funds, to pay the initial and annual costs associated with the Bonds, including, but not
limited to, remarketing, credit enhancement, Fiscal Agent and other fees and expenses relating to the
issuance of the Bonds and the formation of the CFD, and to pay any other "incidental expenses" of the
CFD, as such term is defined in the Act.
"Proportionate Share" means a fraction, the numerator of which is the amount of Special Taxes
that are expected to be levied on all Undeveloped Property pursuant to the RMA in the next Fiscal Year
that begins after the issuance of such Series of Bonds assuming no capitalized interest is used to offset the
amount of such levy, and the denominator of which is the total amount of the Special Taxes expected to
be levied for the same Fiscal Year on all Taxable Property within the CFD assuming no capitalized
interest is used to offset the amount of such levy.
"Qualified Institutional Buyers" means, qualified institutional buyers as defined in Rule 144A
promulgated under the Securities Act of 1933, as amended.
"Rating Agency" means Moody's and Standard & Poor's, or both, as the context requires.
"Record Date" means the fifteenth day of the month preceding an Interest Payment Date,
regardless of whether such day is a Business Day.
"Redemption Account" means the account by such name created and established in the Special
Tax Fund pursuant to Section 3.1 hereof.
"Refunding Bonds" means a Series of Bonds or a portion of a Series of Bonds issued pursuant to
the provisions set forth in Section 3.12.
"Regulations" means the regulations adopted or proposed by the Department of Treasury from
time to time with respect to obligations issued pursuant to section 103 of the Code.
"Representation Letter" shall mean the Representation Letter from the CFD to the Security
Depository as described in Section 2.14 hereof.
"Reserve Account" means the account by such name created and established in the Special Tax
Fund for one or more Series of Bonds pursuant to Section 3.1.
"Reserve Requirement" means on any date of calculation, the lesser of (1) ten percent (10%) of
the original proceeds of the Bonds, (11) 80% of the Maximum Annual Debt Service on the Outstanding
Bonds, or (111) 125% of the average Annual Debt Service on the Outstanding Bonds, as determined by the
CFD.
"Resolution of Formation" means Resolution No. 16-09 adopted by the Council on April 12,
2016, pursuant to which the Council formed the CFD.
"RMA" means Rate and Method of Apportionment approved by the qualified electors of the CFD
at the April 12, 2016 election, as amended from time to time.
42831645.7 10
"Securities Depository" means The Depository Trust Company, 55 Water Street, 50th Floor, New
York, New York, 10041, Attn: Call Notification Department, Fax (212) 855-7232; or, in accordance with
then current guidelines of the Securities and Exchange Commission, such other securities depositaries, or
no such depositaries, as the CFD may designate in writing to the Fiscal Agent.
"Series", whenever used herein with respect to Bonds, means all of the Bonds designated as being
of the same series, authenticated and delivered in a simultaneous transaction regardless of variations in
maturity, interest rate, redemption and other provisions, and any Bonds thereafter authenticated and
delivered upon transfer or exchange or in lieu of or in substitution for (but not to refund) such Bonds as
herein provided.
"Sinking Fund Payment" means the annual payment to be deposited in the Redemption Account
to redeem a portion of the Term Bonds in accordance with the schedule set forth in this Fiscal Agent
Agreement.
"Special Taxes" means the Special Tax For Facilities (as defined in the RMA) authorized to be
levied by the CFD on parcels within the CFD in accordance with the Resolution of Formation, the Act
and the voter approval obtained at the April 12, 2016 election in the CFD and any additional special taxes
authorized to be levied by the CFD from time to time that are pledged by the CFD to the repayment of the
Bonds, together with the proceeds collected from the sale of property pursuant to the foreclosure
provisions of this Fiscal Agent Agreement for the delinquency of such Special Taxes For Facilities
remaining after the payment of all the costs related to such foreclosure actions, including, but not limited
to, all legal fees and expenses, court costs, consultant and title insurance fees and expenses.
"Special Tax Fund" means the fund by such name created and established pursuant to Section 3.1
hereof.
"Standard & Poor's" means S&P Global Ratings, a corporation duly organized and existing under
and by virtue of the laws of the State of New York, and its successors and assigns; provided, however,
that if that corporation has been dissolved or liquidated or is no longer performing the functions of a
securities rating agency, then the term "S&P" means any other nationally recognized securities rating
agency selected by the CFD.
"Supplemental Fiscal Agent Agreement" means any supplemental fiscal agent agreement
amending or supplementing this Fiscal Agent Agreement, but only if and to the extent that such
supplemental fiscal agent agreement is specifically authorized hereunder.
"Surplus Fund" means the fund by such name created and established pursuant to Section 3.1
hereof.
"Tax Certificate", in respect of a Series, means a federal tax certificate with respect to such Series
delivered by the CFD on the Delivery Date of such Series, as the same may be amended or supplemented
in accordance with its terms.
"Taxable Property" means Taxable Property as defined by the RMA.
"Term Bonds" means Bonds payable at or before their specified maturity date or dates from
mandatory Sinking Fund Payments established for that purpose and calculated to retire such Bonds on or
before their specified maturity date or dates.
"Treasurer" means the City Treasurer or designee.
42831645.7 11
"Trigger Event" means (a) the issuance by the CFD of an additional Series of Bonds on parity
with the 2020 Bonds, or (b) the filing of an Annual Report pursuant to the Continuing Disclosure
Certificate which contains information that the Assigned Special Tax that could be levied on Developed
Property is at least equal to 100% of Annual Debt Service on the 2020 Bonds.
"Trigger Event Date" means the date on which a Trigger Event occurs.
"Underwriter" means the institution or institutions, if any, with whom the CFD enters into a
purchase contract for the sale of a Series of Bonds.
"Undeveloped Property" means Undeveloped Property as defined by the RMA.
"Written Request of the CFD" means a request in writing executed by the Mayor, City Manager,
Treasurer, or written designee, on behalf of the CFD.
"2020 Bonds" means the $[principal amount] aggregate principal amount of City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series.
"2020 Delivery Date" means February , 2020.
"2020 Project" means the portion of the Project funded with the proceeds of the 2020 Bonds and
more fully described in Schedule I hereto.
"2020 Parking Project Costs Account" means the account by such name in the Acquisition and
Construction Fund created and established pursuant to Section 3.1 hereof to hold the proceeds of the 2020
Bonds or a portion thereof prior to expenditure on the 2020 Project relating to the parking structures.
"2020 Transit Center Project Costs Account" means the account by such name in the Acquisition
and Construction Fund created and established pursuant to Section 3.1 hereof to hold the proceeds of the
2020 Bonds or a portion thereof prior to expenditure on the 2020 Project relating to a City transit center.
"2020 Underwriter" means Stifel, Nicolaus & Company, Incorporated, the underwriter for the
2020 Bonds.
ARTICLE II
GENERAL AUTHORIZATION AND BOND TERMS
Section 2.1. Authorization of the Bonds; Authorization of the 2020 Bonds.
(a) Under and pursuant to the Act, Bonds may be issued hereunder as fully registered
bonds without coupons, in book -entry form or otherwise, from time to time as the issuance
thereof is approved by the CFD for the purpose of financing the Project, provided that the
aggregate principal amount of the Bonds shall not exceed the total indebtedness presently
authorized or subsequently authorized by the qualified electors of the CFD in accordance with the
Act. The Bonds are designated generally as "City of Santa Clarita Community Facilities District
No. 2016-1 (Vista Canyon) Special Tax Bonds," each Series thereof to bear such additional
designation as may be necessary or appropriate to distinguish such Series from every other Series.
The Bonds may be issued in such Series as from time to time shall be established and authorized
by the CFD, subject to the covenants, provisions and conditions herein contained.
42831645.7 12
(b) Unless otherwise provided in a Supplemental Fiscal Agent Agreement, the Bonds
shall be initially registered in the name of "Cede & Co.," as nominee of the Securities Depository
and shall be evidenced by one bond certificate for each maturity of that Series. The Fiscal Agent
shall assign a letter or number or letter and number, or a combination thereof to each Bond to
distinguish it from other Bonds. Registered ownership of any Series, or any portion thereof, may
not thereafter be transferred except as set forth in Section 2.9 hereof, or in the event the use of the
Securities Depository is discontinued, in accordance with the provisions set forth in Section 2.14
hereof.
(c) The CFD hereby authorizes the creation and issuance of the 2020 Bonds, to be
known as the "City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
Special Tax Bonds, 2020 Series," in the aggregate principal amount of $[principal amount] in
accordance with the Act for the purpose of financing the costs of the 2020 Project.
Section 2.2. Type and Nature of Bonds. Neither the faith and credit nor the taxing power of
the City, the State of California or any political subdivision thereof other than the CFD is pledged to the
payment of the Bonds. Except for the Special Taxes, no other taxes are pledged to the payment of the
Bonds. The Bonds are not general or special obligations of the City nor general obligations of the CFD,
but are limited obligations of the CFD payable solely from certain amounts deposited by the CFD in the
Special Tax Fund (exclusive of amounts transferred to the Administrative Expense Fund), as more fully
described herein. The CFD's limited obligation to pay the principal of, premium, if any, and interest on
the Bonds from amounts in the Special Tax Fund (exclusive of amounts transferred to the Administrative
Expense Fund) is absolute and unconditional, free of deductions and without any abatement, offset,
recoupment, diminution or set-off whatsoever. No Owner of the Bonds may compel the exercise of the
taxing power by the CFD (except as pertains to the Special Taxes) or the City or the forfeiture of any of
their property. The principal of and interest on the Bonds and premiums upon the redemption thereof, if
any, are not a debt of the City, the State of California or any of its political subdivisions within the
meaning of any constitutional or statutory limitation or restriction. The Bonds are not a legal or equitable
pledge, charge, lien, or encumbrance upon any of the CFD's property, or upon any of its income, receipts
or revenues, except the Special Taxes and other amounts in the Special Tax Fund (exclusive of amounts
transferred to the Administrative Expense Fund) which are, under the terms of this Fiscal Agent
Agreement and the Act, set aside for the payment of the Bonds and interest thereon, and neither the
members of the Council nor any persons executing the Bonds are liable personally on the Bonds by
reason of their issuance.
Notwithstanding anything to the contrary contained in this Fiscal Agent Agreement, the CFD
shall not be required to advance any money derived from any source of income other than the Special
Taxes for the payment of the interest on or the principal of the Bonds, or for the performance of any
covenants contained herein. The CFD may, however, advance funds for any such purpose, provided that
such funds are derived from a source legally available for such purpose.
Section 2.3. Equality of Bonds and Pledge of Special Taxes. Pursuant to the Act and this
Fiscal Agent Agreement, the Bonds shall be equally payable from the Special Taxes and other amounts in
the Special Tax Fund (exclusive of amounts transferred to the Administrative Expense Fund) without
priority for series, number, date of the Bonds, date of sale, date of execution, or date of delivery, and the
payment of the interest on and principal of the Bonds and any premiums upon the redemption thereof,
shall be exclusively paid from the Special Taxes and other amounts in the Special Tax Fund (exclusive of
amounts transferred to the Administrative Expense Fund), which are hereby set aside for the payment of
the Bonds. Amounts in the Special Tax Fund (exclusive of amounts transferred to the Administrative
Expense Fund) shall constitute a trust fund held for the benefit of the Owners to be applied to the payment
of the interest on and principal of the Bonds and so long as any of the Bonds or interest thereon remain
42831645.7 13
Outstanding shall not be used for any other purpose, except as permitted by this Fiscal Agent Agreement
or any Supplemental Fiscal Agent Agreement. Notwithstanding any provision contained in this Fiscal
Agent Agreement to the contrary, Special Taxes transferred to the Administrative Expense Fund and the
Surplus Fund shall no longer be considered to be pledged to the Bonds, and none of the Surplus Fund or
the Administrative Expense Fund shall be construed as a trust fund held for the benefit of the Owners.
Nothing in this Fiscal Agent Agreement or any Supplemental Fiscal Agent Agreement shall
prevent additional security being provided for the benefit of a particular Series of Bonds under any
Supplemental Fiscal Agent Agreement. Nothing in this Fiscal Agent Agreement or any Supplemental
Fiscal Agent Agreement shall preclude, subject to the limitations contained hereunder, the redemption
prior to maturity of any Bond subject to call and redemption and payment of said Bond from proceeds of
Refunding Bonds issued under the Act as the same now exists or as hereafter amended, or under any other
law of the State of California.
Section 2.4. Term of the 2020 Bonds. The 2020 Bonds shall be issued in fully registered
form in Authorized Denominations. The 2020 Bonds of each issue shall be numbered as desired by the
Fiscal Agent.
The 2020 Bonds shall be dated their Delivery Date and shall mature and be payable on
September 1 in the years and in the aggregate principal amounts and shall be subject to and shall bear
interest at the rates set forth in the table below payable on each Interest Payment Date.
Maturity Date
(September 1) Principal Amount Interest Rate
Interest shall be payable on each 2020 Bond from the date established in accordance with Section
2.5 below on each Interest Payment Date thereafter until the principal sum of that 2020 Bond has been
paid; provided, however, that if at the maturity date of any Bond (or if the same is redeemable and shall
be duly called for redemption, then at the date fixed for redemption) funds are available for the payment
42831645.7 14
or redemption thereof in full, in accordance with the terms of this Fiscal Agent Agreement, such 2020
Bonds shall then cease to bear interest. Interest due on the 2020 Bonds shall be calculated on the basis of
a 360-day year comprised of twelve 30-day months.
Section 2.5. Place and Form of Payment of the 2020 Bonds. The 2020 Bonds shall be
payable both as to principal and interest, and as to any premiums upon the redemption thereof, in lawful
money of the United States of America. The principal of the 2020 Bonds and any premiums due upon the
redemption thereof shall be payable upon presentation and surrender thereof at the Corporate Trust
Office, or at the designated office of any successor Fiscal Agent. Interest on any 2020 Bond shall be
payable from the Interest Payment Date next preceding the date of authentication of that 2020 Bond,
unless (1) such date of authentication is an Interest Payment Date in which event interest shall be payable
from such date of authentication, (11) the date of authentication is after a Record Date but prior to the
immediately succeeding Interest Payment Date, in which event interest shall be payable from the Interest
Payment Date immediately succeeding the date of authentication, or (111) the date of authentication is prior
to the close of business on the first Record Date occurring after the issuance of such 2020 Bond, in which
event interest shall be payable from the dated date of such 2020 Bond, as applicable; provided, however,
that if at the time of authentication of such 2020 Bond, interest is in default, interest on that 2020 Bond
shall be payable from the last Interest Payment Date to which the interest has been paid or made available
for payment or, if no interest has been paid or made available for payment on that 2020 Bond, interest on
that 2020 Bond shall be payable from its dated date. Interest on any 2020 Bond shall be paid to the
person whose name shall appear in the Bond Register as the Owner of such 2020 Bond as of the close of
business on the Record Date. Such interest shall be paid by check of the Fiscal Agent mailed on the
Interest Payment Date by first class mail, postage prepaid, to such Bondowner at his or her address as it
appears on the Bond Register. In addition, upon a request in writing received by the Fiscal Agent on or
before the applicable Record Date from an Owner of $1,000,000 or more in principal amount of the 2020
Bonds, payment shall be made on the Interest Payment Date by wire transfer in immediately available
funds to an account within the United States designated by such Owner. Notwithstanding the foregoing,
however, for so long as a Security Depository is utilized, interest on and principal of the 2020 Bonds shall
be payable in accordance with the payment procedures established pursuant by such Security Depository.
Section 2.6. Form of 2020 Bonds. The 2020 Bonds and the certificate of authentication shall
be substantially in the form attached hereto as Exhibit A, which forms are hereby approved and adopted
as the forms of such 2020 Bonds and of the certificate of authentication.
Notwithstanding any provision in this Fiscal Agent Agreement to the contrary, the CFD may, in
its sole discretion, elect to issue the 2020 Bonds in book -entry form.
Section 2.7. Temporary Bonds. Until definitive Bonds shall be prepared, the CFD may
cause to be executed and delivered in lieu of such definitive Bonds temporary bonds in typed, printed,
lithographed or engraved form and in fully registered form, subject to the same provisions, limitations and
conditions as are applicable in the case of definitive Bonds, except that they may be in any denominations
authorized by the CFD. Until exchanged for definitive Bonds, any temporary bond shall be entitled and
subject to the same benefits and provisions of this Fiscal Agent Agreement as definitive Bonds. If the
CFD issues temporary Bonds, it shall execute and furnish definitive Bonds, without unnecessary delay
and thereupon any temporary Bond may be surrendered to the Fiscal Agent at its office, without expense
to the Owner, in exchange for a definitive Bond of the same Series, issue, maturity, interest rate and
principal amount in any Authorized Denomination. All temporary Bonds so surrendered shall be
cancelled by the Fiscal Agent and shall not be reissued.
Section 2.8. Execution and Authentication. The Bonds shall be signed on behalf of the
CFD by the manual or facsimile signature of the Mayor or the City Manager of the City, and attested by
42831645.7 15
the signature of the City Clerk. In case any one or more of the officers who shall have signed or sealed
any of the Bonds shall cease to be such officer before the Bonds so signed and sealed have been
authenticated and delivered by the Fiscal Agent (including new Bonds delivered pursuant to the
provisions hereof with reference to the transfer and exchange of Bonds or to lost, stolen, destroyed or
mutilated Bonds), such Bonds shall nevertheless be valid and may be authenticated and delivered as
herein provided, and may be issued as if the person who signed or sealed such Bonds had not ceased to
hold such office.
Only the Bonds as shall bear thereon such certificate of authentication in the form set forth in
Exhibit A hereto or in any Supplemental Fiscal Agent Agreement shall be entitled to any right or benefit
under this Fiscal Agent Agreement, and no Bond shall be valid or obligatory for any purpose until such
certificate of authentication shall have been duly executed by the Fiscal Agent.
Section 2.9. Bond Register. The Fiscal Agent will keep or cause to be kept, at its office,
sufficient books for the registration and transfer of the Bonds which shall upon reasonable prior notice be
open to inspection by the CFD during all regular business hours, and, subject to the limitations set forth in
Section 2.9 below, upon presentation for such purpose, the Fiscal Agent shall, under such reasonable
regulations as it may prescribe, register or transfer or cause to be transferred on said Bond Register,
Bonds as herein provided.
The CFD and the Fiscal Agent may treat the Owner of any Bond whose name appears on the
Bond Register as the absolute Owner of that Bond for any and all purposes, and the CFD and the Fiscal
Agent shall not be affected by any notice to the contrary. The CFD and the Fiscal Agent may rely on the
address of the Bondowner as it appears in the Bond Register for any and all purposes. It shall be the duty
of the Bondowner to give written notice to the Fiscal Agent of any change in the Bondowner's address so
that the Bond Register may be revised accordingly.
Section 2.10. Registration of Exchange or Transfer. Subject to the limitations set forth in
the following paragraph, the registration of any Bond may, in accordance with its terms, be transferred
upon the Bond Register by the person in whose name it is registered, in person or by his or her duly
authorized attorney, upon surrender of such Bond for cancellation at the office of the Fiscal Agent,
accompanied by delivery of written instrument of transfer in a form approved by the Fiscal Agent and
duly executed by the Bondowner or his or her duly authorized attorney.
Bonds may be exchanged at the office of the Fiscal Agent for a like aggregate principal amount
of Bonds for other Authorized Denominations of the same maturity and issue. The Fiscal Agent shall not
collect from the Owner any charge for any new Bond issued upon any exchange or transfer, but shall
require the Bondowner requesting such exchange or transfer to pay any tax or other governmental charge
required to be paid with respect to such exchange or transfer. Whenever any Bonds shall be surrendered
for registration of transfer or exchange, the CFD shall execute and the Fiscal Agent shall authenticate and
deliver a new Bond or Bonds of the same Series, issue and maturity, for a like aggregate principal
amount; provided that, unless otherwise provided in any Supplemental Fiscal Agent Agreement, that the
Fiscal Agent shall not be required to register transfers or make exchanges of (1) Bonds for a period of 15
days next preceding any selection of the Bonds to be redeemed, or (11) any Bonds chosen for redemption.
Section 2.11. Mutilated, Lost, Destroyed or Stolen Bonds. If any Bond shall become
mutilated, the CFD shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like
Series, tenor, date, issue and maturity in exchange and substitution for the Bond so mutilated, but only
upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the
Fiscal Agent shall be cancelled by the Fiscal Agent pursuant to Section 10.1 hereof. If any Bond shall be
lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent
42831645.7 16
and, if such evidence is satisfactory to the Fiscal Agent and, if any indemnity satisfactory to the CFD and
the Fiscal Agent shall be given, the CFD shall execute and the Fiscal Agent shall authenticate and deliver,
a new Bond, as applicable, of like Series, tenor, maturity and issue, numbered and dated as the Fiscal
Agent shall determine in lieu of and in substitution for the Bond so lost, destroyed or stolen. Any Bond
issued in lieu of any Bond alleged to be mutilated, lost, destroyed or stolen, shall be equally and
proportionately entitled to the benefits hereof with all other Bonds issued hereunder. The Fiscal Agent
shall not treat both the original Bond and any replacement Bond as being Outstanding for the purpose of
determining the principal amount of Bonds which may be executed, authenticated and delivered
hereunder or for the purpose of determining any percentage of Bonds Outstanding hereunder, but both the
original and replacement Bond shall be treated as one and the same. Notwithstanding any other provision
of this Section, in lieu of delivering a new Bond which has been mutilated, lost, destroyed or stolen, and
which has matured, the Fiscal Agent may make payment with respect to such Bonds.
Section 2.12. Validity of Bonds. The validity of the authorization and issuance of the Bonds
shall not be affected in any way by any defect in any proceedings taken by the CFD, or by the invalidity,
in whole or in part, of any contracts made by the CFD in connection therewith, and the recital contained
in the Bonds that the same are issued pursuant to the Act and other applicable laws of the State shall be
conclusive evidence of their validity and of the regularity of their issuance.
Section 2.13. Book -Entry System. Unless otherwise provided in any Supplemental Fiscal
Agent Agreement delivered in connection with a Series, the Bonds shall be initially delivered in the form
of a separate single fully registered Bond (which may be typewritten) for each of the maturities of the
Bonds. Upon initial delivery, the ownership of each such Bond shall be registered in the registration
books kept by the Fiscal Agent in the name of the Nominee as nominee of the Security Depository.
Unless the CFD elects to discontinue the use of the book -entry system, all of the Outstanding Bonds shall
be registered in the registration books kept by the Fiscal Agent in the name of the Nominee.
With respect to Bonds registered in the registration books kept by the Fiscal Agent in the name of
the Nominee, the CFD and the Fiscal Agent shall have no responsibility or obligation to any such
Participant or to any Person on behalf of which such a Participant holds an interest in the Bonds. Without
limiting the immediately preceding sentence, the CFD and the Fiscal Agent shall have no responsibility or
obligation with respect to (1) the accuracy of the records of the Security Depository, the Nominee, or any
Participant with respect to any ownership interest in the Bonds, (11) the delivery to any Participant or any
other Person, other than an Owner as shown in the registration books kept by the Fiscal Agent, of any
notice with respect to the Bonds, including any notice of redemption, (111) the selection by the Security
Depository and its Participants of the beneficial interests in the Bonds to be redeemed in the event the
Bonds are redeemed in part, or (iv) the payment to any Participant or any other Person, other than an
Owner as shown in the registration books kept by the Fiscal Agent, of any amount with respect to
principal of, premium, if any, or interest due with respect to the Bonds. The CFD and the Fiscal Agent
may treat and consider the Person in whose name each Bond of a Series is registered in the registration
books kept by the Fiscal Agent as the holder and absolute owner of such Bond of that Series for the
purpose of payment of the principal of, premium, if any, and interest on such Bond of that Series, for the
purpose of giving notices of redemption and other matters with respect to such Bond of that Series, for the
purpose of registering transfers with respect to such Bond of that Series, and for all other purposes
whatsoever. The Fiscal Agent shall pay all principal of, premium, if any, and interest due on the Bonds
only to or upon the order of the respective Owner, as shown in the registration books kept by the Fiscal
Agent, or their respective attorneys duly authorized in writing, and all such payments shall be valid and
effective to satisfy and discharge fully the CFD's obligations with respect to payment of the principal,
premium, if any, and interest due on the Bonds to the extent of the sum or sums so paid. No Person other
than an Owner, as shown in the registration books kept by the Fiscal Agent, shall receive a Bond
evidencing the obligation of the CFD to make payments of principal, premium, if any, and interest
42831645.7 17
pursuant to this Fiscal Agent Agreement. Upon delivery by the Security Depository to the Fiscal Agent
and the CFD of written notice to the effect that the Security Depository has determined to substitute a new
nominee in place of the Nominee, and subject to the provisions herein with respect to Record Dates, the
word Nominee in this Fiscal Agent Agreement shall refer to such new nominee of the Security
Depository.
Section 2.14. Representation Letter. In order to qualify the Bonds which the CFD elects to
register in the name of the Nominee for the Security Depository's book -entry system, an authorized
representative of the CFD is hereby authorized to execute from time to time and deliver to such Security
Depository the Representation Letter. The execution and delivery of the Representation Letter shall not
in any way limit the provisions of Section 10.2 or in any other way impose upon the CFD or the Fiscal
Agent any obligation whatsoever with respect to persons having interests in the Bonds other than the
Owners, as shown on the registration books kept by the Fiscal Agent. In addition to the execution and
delivery of the Representation Letter, the Mayor and any Authorized Representative of the CFD are
hereby authorized to take any other actions, not inconsistent with this Fiscal Agent Agreement, to qualify
the Bonds for the Security Depository's book -entry program.
Section 2.15. Transfers Outside Book -Entry System. In the event (1) the Security
Depository determines not to continue to act as securities depository for the Bonds, or (11) the CFD
determines that the Security Depository shall no longer so act, then the CFD will discontinue the book -
entry system with the Security Depository. If the CFD fails to identify another qualified securities
depository to replace the Security Depository then the Bonds so designated shall no longer be restricted to
being registered in the registration books kept by the Fiscal Agent in the name of the Nominee, but shall
be registered in whatever name or names Persons transferring or exchanging Bonds shall designate, in
accordance with the provisions of Section 2.9 hereof.
Section 2.16. Payments to the Nominee. Notwithstanding any other provisions of this Fiscal
Agent Agreement to the contrary, so long as any Bond of a Series is registered in the name of the
Nominee, all payments with respect to principal, premium, if any, and interest due with respect to such
Bond of that Series and all notices with respect to such Bond of that Series shall be made and given,
respectively, as provided in the Representation Letter or as otherwise instructed by the Security
Depository.
Section 2.17. Initial Security Depository and Nominee. The initial Security Depository
under this Article shall be The Depository Trust Company, New York, New York. The initial Nominee
shall be Cede & Co., as Nominee of The Depository Trust Company, New York, New York.
Section 2.18. Restrictions on Initial Ownership; Resale Restrictions and Limits on
Transferability of 2020 Bonds. Notwithstanding any other provision hereof, each initial Beneficial
Owner of the 2020 Bonds shall, at the time of such Beneficial Owner's acquisition of its interest in the
2020 Bonds, either be (a) a Qualified Institutional Buyer, or (b) an Accredited Investor. [There shall be
provided the "Investor Letter" of the 2020 Bondholder Representative in the form of Exhibit _ attached
hereto to the CFD and the Fiscal Agent.]
Prior to the Trigger Event Date, no transfer, sale or other disposition of any 2020 Bond, or any
beneficial interest therein, shall be made except to an entity that the transferor reasonably believes is
either (i) a Qualified Institutional Buyer or (11) an Accredited Investor who is purchasing for its own
account for investment purposes and not with a view to distributing such 2020 Bond. Each transferee of a
2020 Bond, or any beneficial interest therein, by its purchase thereof, shall be deemed to have represented
that such transferee is a Qualified Institutional Buyer or an Accredited Investor that is purchasing such
42831645.7 18
2020 Bond for its own account for investment purposes and not with a view to distributing such 2020
Bond.
The 2020 Bonds shall bear a legend describing or referencing the restrictions on transferability set
forth herein.
Each entity which is or which becomes a Beneficial Owner of a 2020 Bond prior to the Trigger
Event Date shall be deemed by the acceptance or acquisition of such beneficial ownership interest to have
agreed to be bound by the transfer restrictions provisions herein. The transferor of a 2020 Bond
transferred prior to the Trigger Event Date shall be deemed to have agreed to provide notice to any
proposed assignee of a beneficial ownership interest in the purchased 2020 Bond of the restrictions on
transfer described herein.
Prior to the Event Trigger Date, each purchaser of any of the 2020 Bonds (each, a "Purchaser"),
by its acceptance thereof or of any interest therein, acknowledges and agrees with the CFD, the City and
the Underwriter that (1) the Purchaser (a) is a Qualified Institutional Buyer or an Accredited Investor, and
(b) is acquiring such 2020 Bonds for its own account or for the account of a Qualified Institutional Buyer
or an Accredited Investor; (11) the Purchaser has sufficient knowledge and experience in financial and
business matters with respect to the evaluation of the risk and merits of the investment represented by the
2020 Bonds and the Purchaser is able to bear the economic risks of such investment; and (iii) the
Purchaser understands that the 2020 Bonds are limited obligations of the CFD secured only by a pledge of
Special Taxes and other assets pledged therefor hereunder.
Upon the Trigger Event Date, this Section shall be of no further force or effect and the
Authorized Denominations of the 2020 Bonds shall be automatically changed to denominations of $5,000
or any integral multiple thereof, in each case. The restrictions on transfer of the 2020 Bonds described
above shall no longer be applicable to transfers of the 2020 Bonds or any beneficial interest therein on the
Trigger Event Date.
ARTICLE III
CREATION OF FUNDS AND APPLICATION OF SPECIAL TAXES
Section 3.1. Creation of Funds. There is hereby created and established the following funds,
accounts and subaccounts:
(1) The Community Facilities District No. 2016-1 Administrative Expense Fund (the
"Administrative Expense Fund") which shall be held and maintained by the Treasurer;
(2) The Community Facilities District No. 2016-1 Special Tax Fund (the "Special Tax
Fund") (in which there shall be established and created an Interest Account, a Principal Account, a
Redemption Account, and a Reserve Account; and following the issuance of a Series of Bonds, the Fiscal
Agent shall create separate interest subaccounts for such Series) which shall be held and maintained by
the Fiscal Agent;
(3) The Community Facilities District No. 2016-1 Surplus Fund (the "Surplus Fund") which
shall be held and maintained by the Fiscal Agent;
(4) The Community Facilities District No. 2016-1 Acquisition and Construction Fund (the
"Acquisition and Construction Fund") (which shall consist of the 2020 Parking Project Costs Account
and the 2020 Transit Center Project Costs Account; and following the issuance of a Series of Bonds, the
42831645.7 19
Fiscal Agent shall create separate Parking Project Costs and Transit Center Project Costs accounts for
such Series) which shall be held and maintained by the Fiscal Agent; and
(5) The Community Facilities District No. 2016-1 Costs of Issuance Fund (the "Costs of
Issuance Fund") which shall be held and maintained by the Fiscal Agent.
The amounts on deposit in the foregoing funds, accounts and subaccounts (other than the
Administrative Expense Fund) shall be held by the Fiscal Agent and the Fiscal Agent shall invest and
disburse the amounts in such funds, accounts and subaccounts in accordance with the provisions of this
Article III and shall disburse investment earnings thereon in accordance with the provisions of Section 3.9
hereof. Except as required to be segregated into funds and accounts as described herein, money held by
the Fiscal Agent hereunder need not be segregated from other funds except to the extent required by law.
At the Written Request of the CFD, the Fiscal Agent may create new funds, accounts or
subaccounts, or may create additional accounts and subaccounts within any of the foregoing funds and
accounts for the purpose of separately accounting for the proceeds of any Series of Bonds.
Section 3.2. Application of 2020 Bond Proceeds. All proceeds of the sale of the 2020
Bonds shall be received by the Fiscal Agent on behalf of the CFD and deposited and transferred as
follows:
(1) $ shall be deposited to the Costs of Issuance Fund established hereunder
for disbursement in accordance with Section 3.10 below;
(2) $ (which is equal to the initial Reserve Requirement) shall be deposited in
the Reserve Account to be disbursed in accordance with Section 3.7 below;
(3) $ shall be deposited to the 2020 Transit Center Project Costs Account of
the Acquisition and Construction Fund for disbursement in accordance with Section 3.9 below.
(4) $ shall be deposited to the 2020 Parking Project Costs Account of the
Acquisition and Construction Fund for disbursement in accordance with Section 3.9 below.
Section 3.3. Deposits to and Disbursements from Special Tax Fund. The CFD shall,
within ten (10) Business Days of receipt of Special Taxes, and following the annual transfer of Special
Taxes to the Administrative Expense Fund in an amount equal to the such Fiscal Year's Administrative
Expense Requirement pursuant to Section 3.4 hereof, transfer the remaining Special Taxes to the Fiscal
Agent for deposit in the Special Tax Fund to be held in accordance with the terms of this Fiscal Agent
Agreement. The Fiscal Agent shall transfer the amounts on deposit in the Special Tax Fund on the dates
and in the amounts set forth in the following Sections in the following order of priority:
(a) The Interest Account of the Special Tax Fund;
(b) The Principal Account of the Special Tax Fund;
(c) The Redemption Account of the Special Tax Fund;
(d) The Reserve Account of the Special Tax Fund; and
(e) The Surplus Fund.
42831645.7 20
At the maturity of all of the Bonds and, after all principal and interest then due on the Bonds then
Outstanding has been paid or provided for and any amounts owed to the Fiscal Agent have been paid in
full, moneys in the Special Tax Fund and any accounts therein shall be transferred to the CFD and may be
used by the CFD for any lawful purpose.
Section 3.4. Administrative Expense Fund. Upon receipt of Special Taxes and prior to the
transfer of Special Taxes to the Fiscal Agent for deposit in the Special Tax Fund, the CFD shall deposit in
the Administrative Expense Fund an amount equal to the Administrative Expense Requirement for the
Bond Year. The Fiscal Agent shall transfer from the Surplus Fund to the Treasurer for deposit into the
Administrative Expense Fund from time to time upon the Written Request of the CFD, in accordance with
Section 3.8, additional amounts necessary to make timely payment of Administrative Expenses. Moneys
in the Administrative Expense Fund shall be applied exclusively to pay Administrative Expenses, all as
instructed by the CFD pursuant to a Written Request of the CFD. The Treasurer shall maintain a record
of deposits and disbursements within the Administrative Expense Fund, which record shall be available
for inspection by the public. Annually, the Treasurer shall determine if there exists a surplus of moneys
in the Administrative Expense Fund not needed for the payment of Administrative Expenses, and shall
transfer such surplus, if any, to the Fiscal Agent for deposit in the Surplus Fund to be used in accordance
with Section 3.8. Moneys in the Administrative Expense Fund may be invested in any Authorized
Investments as directed by an Authorized Representative of the CFD.
Section 3.5. Interest Account and Principal Account of the Special Tax Fund. Upon
receipt of Special Taxes from the CFD for deposit in the Special Tax Fund, the principal of and interest
due on the Bonds until maturity, other than principal due upon redemption, shall be paid by the Fiscal
Agent from the Principal Account and the Interest Account of the Special Tax Fund, respectively. For the
purpose of assuring that the payment of principal of and interest on the Bonds will be made when due, at
least five Business Days prior to each March 1 and September 1, the Fiscal Agent shall make the
following transfers from the Special Tax Fund first to the Interest Account and then to the Principal
Account; provided, however, that to the extent that deposits have been made in the Interest Account from
the proceeds of the sale of a Series of Bonds, or otherwise, the transfer from the Special Tax Fund need
not be made; and provided, further, that, if amounts in the Special Tax Fund are inadequate to make the
foregoing transfers, then any deficiency shall be made up by an immediate transfer from the Reserve
Account:
(1) To the Interest Account, an amount such that the balance in the Interest Account five
Business Days prior to each Interest Payment Date shall be equal to the installment of interest due on the
Bonds on said Interest Payment Date and any installment of interest due on a previous Interest Payment
Date which remains unpaid. Moneys in the Interest Account shall be used for the payment of interest on
the Bonds as the same become due.
(2) To the Principal Account, an amount such that the balance in the Principal Account five
Business Days prior to September 1 of each year, commencing September 1, 2021, shall at least equal the
principal payment due on the Bonds maturing on such September 1 and any principal payment due on a
previous September 1 which remains unpaid. Moneys in the Principal Account shall be used for the
payment of the principal of such Bonds as the same become due at maturity.
Section 3.6. Redemption Account of the Special Tax Fund.
(1) For each September 1 on which a Sinking Fund Payment is due, after the deposits have
been made to the Interest Account and the Principal Account of the Special Tax Fund as required by
Section 3.5 hereof, the Fiscal Agent shall next transfer into the Redemption Account of the Special Tax
Fund from the Special Tax Fund the amount needed to make the balance in the Redemption Account five
42831645.7 21
Business Days prior to each September 1 equal to the Sinking Fund Payment due on any Outstanding
Bonds on such September 1; provided, however, that, if amounts in the Special Tax Fund are inadequate
to make the foregoing transfers, then any deficiency shall be made up by an immediate transfer from the
Reserve Account, if funded, pursuant to Section 3.7 below. Moneys so deposited in the Redemption
Account shall be used and applied by the Fiscal Agent to call and redeem Term Bonds in accordance with
the Sinking Fund Payment schedule set forth in Section 4.1 hereof or any Supplemental Fiscal Agent
Agreement.
(2) After making the deposits to the Interest Account and the Principal Account of the
Special Tax Fund pursuant to Section 3.5 above and to the Redemption Account for Sinking Fund
Payments then due pursuant to subparagraph (1) of this Section, and in accordance with the CFD's
election to call Bonds of a Series for optional redemption as set forth in Section 4.1(1) hereof or any
Supplemental Fiscal Agent Agreement, the Fiscal Agent shall transfer from the Special Tax Fund and
deposit in the Redemption Account moneys available for the purpose and sufficient to pay the interest, the
principal and the premiums, if any, payable on the Bonds of such Series called for optional redemption;
provided, however, that amounts in the Special Tax Fund may be applied to optionally redeem Bonds
only if immediately following such redemption the amount in the Reserve Account will equal the Reserve
Requirement.
(3) Pursuant to Section G of the RMA, a portion of all prepayments of Special Taxes shall be
deposited in the Redemption Account to be used to redeem Bonds as directed by the CFD in writing on
the next date for which notice of redemption can timely be given.
(4) Moneys set aside in the Redemption Account shall be used solely for the purpose of
redeeming Bonds and shall be applied on or after the redemption date to the payment of the principal of
and premium, if any, on the Bonds to be redeemed upon presentation and surrender of such Bonds and in
the case of an optional redemption to pay the interest thereon; provided, however, that in lieu or partially
in lieu of such call and redemption, moneys deposited in the Redemption Account as set forth above may
be used to purchase Outstanding Bonds in the manner hereinafter provided. Purchases of Outstanding
Bonds may be made by the CFD at public or private sale as and when and at such prices as the CFD may
in its discretion determine but only at prices (including brokerage or other expenses) not more than par
plus accrued interest, plus, in the case of moneys set aside for an optional redemption, the premium
applicable at the next following call date according to the premium schedule established pursuant to
Section 4.1(1) hereof The CFD shall provide written direction to Fiscal Agent to purchase such
Outstanding Bonds at the purchase price specified by the CFD from moneys in the Redemption Account.
Any accrued interest payable upon the purchase of Bonds may be paid from the amount reserved in the
applicable interest subaccount of the Interest Account of the Special Tax Fund for the payment of interest
on the next following Interest Payment Date.
Section 3.7. Reserve Account of the Special Tax Fund. There shall be maintained in the
Reserve Account of the Special Tax Fund an amount equal to the Reserve Requirement. The amounts in
the Reserve Account shall be applied as follows:
(1) Moneys in the Reserve Account shall be used solely for the purpose of paying the
principal of, including Sinking Fund Payments, and interest on any Bonds when due in the event that the
moneys in the Interest Account and the Principal Account of the Special Tax Fund are insufficient
therefor or moneys in the Redemption Account of the Special Tax Fund are insufficient to make a Sinking
Fund Payment when due. If the amounts in the Interest Account, the Principal Account or the
Redemption Account of the Special Tax Fund are insufficient to pay the principal of, including Sinking
Fund Payments, or interest on any Bonds when due, the Fiscal Agent shall withdraw from the Reserve
42831645.7 22
Account for deposit in the Interest Account, the Principal Account or the Redemption Account of the
Special Tax Fund, as applicable, moneys necessary for such purposes.
(2) Whenever moneys are withdrawn from the Reserve Account, after making the required
transfers referred to in Sections 3.5 and 3.6 above, the Fiscal Agent shall transfer to the Reserve Account
from available moneys in the Special Tax Fund, or from any other legally available funds which the CFD
elects to apply to such purpose, the amount needed to restore the amount of such Reserve Account to the
Reserve Requirement. Moneys in the Special Tax Fund shall be deemed available for transfer to the
Reserve Account only if the Fiscal Agent determines that such amounts will not be needed to make the
deposits required to be made to the Interest Account, the Principal Account or the Redemption Account of
the Special Tax Fund. If amounts in the Special Tax Fund or otherwise transferred to replenish the
Reserve Account are inadequate to restore the Reserve Account to the Reserve Requirement, then the
CFD shall include the amount necessary fully to restore the Reserve Account to the Reserve Requirement,
in the next annual Special Tax levy to the extent of the maximum permitted Special Tax rates.
(3) In connection with any redemption of the Bonds of a Series, or a partial defeasance of the
Bonds of a Series in accordance with Section 9.1 hereof, amounts in the Reserve Account may, upon
written direction of the CFD to the Fiscal Agent, be applied to such redemption or partial defeasance so
long as the amount on deposit in the Reserve Account following such redemption or partial defeasance
equals the Reserve Requirement. To the extent that the amount in the Reserve Account is equal to at least
the Reserve Requirement as of the first day of the final Bond Year for the Bonds, amounts in the Reserve
Account shall be applied to pay the principal of and interest due on the Bonds in the final Bond Year.
(4) Moneys in the Reserve Account in excess of the Reserve Requirement not transferred in
accordance with the preceding paragraphs shall be withdrawn from the Reserve Account on the fifth
Business Day before each March 1 and September 1 and transferred to the Surplus Fund.
Section 3.8. Surplus Fund. After making the transfers required by Sections 3.4, 3.5, 3.6, and
3.7 hereof, as soon as practicable after each September 1, the Fiscal Agent shall transfer all remaining
amounts in the Special Tax Fund to the Surplus Fund; provided that for the fiscal year 2019-20 levy, after
making the transfers required by Sections 3.4, 3.5, 3.6 and 3.7 hereof, the Fiscal Agent shall immediately
transfer all remaining amounts in the Special Tax Fund to the 2020 Parking Project Costs Account of the
Acquisition and Construction Fund. Moneys deposited in the Surplus Fund shall be transferred by the
Fiscal Agent at the written direction of the CFD in a Certificate of an Authorized Representative of the
CFD, first, to the Treasurer for deposit in the Administrative Expense Fund to pay Administrative
Expenses to the extent that the amounts on deposit in the Administrative Expense Fund are insufficient to
pay Administrative Expenses, second, the amount specified in the Certificate of an Authorized
Representative of the CFD to the Interest Account of the Special Tax Fund to pay debt service and shall
be designated as being available in the Special Tax Fund in calculating the amount of the levy of Special
Taxes for such Fiscal Year pursuant to Section 5.2(2) hereof, and, third, the amount specified in the
Certificate of an Authorized Representative of the CFD to the extent included as part of the calculation
for Special Tax Requirement for Facilities as defined in the RMA for pay-as-you-go facilities eligible to
be constructed or acquired by the CFD pursuant to subsection (v) of the definition thereof, to the
Acquisition and Construction Fund to be apportioned 85% for deposit into a subaccount of the Parking
Project Costs Account and 15% for deposit into a subaccount of the Transit Center Project Costs Account
of the Acquisition and Construction Fund, and, fourth, the amount specified in the Certificate of an
Authorized Representative of the CFD may be disbursed to the CFD to be expended for any other lawful
purpose of the CFD.
The amounts in the Surplus Fund are not pledged to the repayment of the Bonds. In the event that
the CFD reasonably expects to use any portion of the moneys in the Surplus Fund to pay debt service on
42831645.7 23
any Outstanding Bonds, upon the written direction of the CFD, the Fiscal Agent will segregate such
amount into a separate subaccount and the moneys on deposit in such subaccount of the Surplus Fund
shall be invested in Authorized Investments the interest on which is excludable from gross income under
Section 103 of the Code (other than bonds the interest on which is a tax preference item for purposes of
computing the alternative minimum tax of individuals and corporations under the Code) or in Authorized
Investments at a yield not in excess of the yield on the issue of Bonds to which such amounts are to be
applied, unless, in the opinion of Bond Counsel, investment at a higher yield will not adversely affect the
exclusion from gross income for federal income tax purposes of interest on the Bonds which were issued
on a tax-exempt basis for federal income tax purposes.
Section 3.9. Acquisition and Construction Fund.
(1) The moneys in the Acquisition and Construction Fund shall be applied exclusively to pay
the Project Costs. Amounts for Project Costs shall be disbursed by the Fiscal Agent from the accounts in
the Acquisition and Construction Fund designated therefor in a requisition signed by an Authorized
Representative of the CFD, substantially in the form of Exhibit B hereto, which must be submitted in
connection with each requested disbursement. The moneys in the 2020 Parking Project Costs Account
shall be applied exclusively for Project Costs relating to the parking structures. The moneys in the 2020
Transit Center Project Costs Account shall be applied exclusively for Project Costs relating to a City
transit center.
(2) Upon receipt of (1) a written notice from the Developer that all or a specified portion of
the amount remaining in the 2020 Parking Project Costs Account within the Acquisition and Construction
Fund is no longer needed to pay for Project costs, and (11) a Certificate of Authorized Representative of
the CFD that all or a specified portion of the amount remaining in the Acquisition and Construction Fund
is no longer needed to pay Project Costs, the Fiscal Agent shall redeem Bonds or transfer all or such
specified portion of the moneys remaining on deposit in one or more of the accounts in the Acquisition
and Construction Fund to the Surplus Fund. Upon transfer of the final amounts on deposit in the
Acquisition and Construction Fund, as directed in the Certificate of Authorized Representative of the
CFD, such accounts and fund shall be closed.
Section 3.10. Costs of Issuance Fund.
(1) The moneys in the Costs of Issuance Fund shall be applied exclusively to pay the Costs
of Issuance. Amounts for Costs of Issuance shall be disbursed by the Fiscal Agent from the Costs of
Issuance Fund pursuant to a requisition signed by an Authorized Representative of the CFD, substantially
in the form of Exhibit C hereto, which must be submitted in connection with each requested
disbursement.
(2) Any amount remaining in the Costs of Issuance Fund on the date 180 days from the 2020
Delivery Date shall be transferred to the Acquisition and Construction Fund to be apportioned 85% for
deposit into the 2020 Parking Project Costs Account and 15% for deposit into the 2020 Transit Center
Project Costs Account of the Acquisition and Construction Fund, and the Costs of Issuance Fund shall be
closed.
Section 3.11. Investments. Moneys held in any of the funds and accounts under this Fiscal
Agent Agreement shall be invested at the Written Request of the CFD in accordance with the limitations
set forth below only in Authorized Investments which shall be deemed at all times to be a part of such
funds and accounts. Any loss resulting from such Authorized Investments shall be credited or charged to
the fund or account from which such investment was made, and, unless otherwise provided in a
Supplemental Fiscal Agent Agreement establishing the terms and provisions of a Series of Bonds, any
42831645.7 24
investment earnings on a fund or account shall be applied as follows: (i) investment earnings on all
amounts deposited in the [Administrative Expense Fund], Special Tax Fund, Acquisition and
Construction Fund, and each Account therein shall be deposited in those respective funds and accounts,
and (11) all other investment earnings shall be deposited in the Interest Account of the Special Tax Fund;
provided, however, to the extent moneys in the Reserve Account exceed the Reserve Requirement, such
excess amounts shall be deposited and transferred pursuant to Section 3.7(3) hereof. Moneys in the funds
and accounts held under this Fiscal Agent Agreement may be invested by the Fiscal Agent at the Written
Request of the CFD received at least 2 Business Days prior to the investment date, from time to time, in
Authorized Investments subject to the following restrictions:
(1) Moneys in the Interest Account, the Principal Account and the Redemption Account of
the Special Tax Fund shall be invested only in Authorized Investments which will by their terms mature,
or in the case of an Investment Agreement are available for withdrawal without penalty, on such dates so
as to ensure the payment of principal of, premium, if any, and interest on the Bonds as the same become
due.
(2) Moneys in the Acquisition and Construction Fund and the Costs of Issuance Fund shall
be invested in Authorized Investments which will by their terms mature, or in the case of an Investment
Agreement are available without penalty, as close as practicable to the date the CFD estimates the moneys
represented by the particular investment will be needed for withdrawal from the Acquisition and
Construction Fund or the Costs of Issuance Fund, as applicable. Notwithstanding anything herein to the
contrary, amounts in the Acquisition and Construction Fund on the Delivery Date for the Bonds shall not
be invested at yields greater than those set forth in the Tax Certificate.
(3) [One-half of the amount in the Reserve Account of the Special Tax Fund may be invested
only in Authorized Investments which mature not later than two years from their date of purchase by the
Fiscal Agent, and one-half of the amount in the Reserve Account may be invested only in Authorized
Investments which mature not more than three years from the date of purchase by the Fiscal Agent;
provided that such amounts may be invested in an Investment Agreement to the final maturity of the
Bonds so long as such amounts may be withdrawn at any time, without penalty, for application in
accordance with Section 3.7 hereof, and provided that no such Authorized Investment of amounts in the
Reserve Account allocable to the Bonds shall mature later than the final maturity date of the Bonds].
(4) In the absence of Written Request of the CFD providing investment directions, the Fiscal
Agent shall invest solely in Authorized Investments specified in clause (4) of the definition thereof,
provided, however, that any such investment shall be made by the Fiscal Agent only if, prior to the date
on which such investment is to be made, the Fiscal Agent shall have received a written direction from the
CFD specifying a specific money market fund and, if no such written direction from the CFD is so
received, the Fiscal Agent shall hold such moneys uninvested.
The Fiscal Agent shall sell, or present for redemption, any Authorized Investment whenever it
may be necessary to do so in order to provide moneys to meet any payment or transfer to such Funds and
Accounts or from such Funds and Accounts. For the purpose of determining at any given time the
balance in any such Funds and Accounts, any such investments constituting a part of such Funds and
Accounts shall be valued at the fair market value thereof, and amounts in the Reserve Account shall be
marked to market at least annually. Notwithstanding anything herein to the contrary, the Fiscal Agent
shall not be responsible for any loss from investments, sales or transfers undertaken in accordance with
the provisions of this Fiscal Agent Agreement. The Fiscal Agent or an affiliate may act as principal or
agent in connection with the acquisition or disposition of any Authorized Investments and shall be
entitled to its customary fees therefor. Any Authorized Investments that are registrable securities shall be
registered in the name of the Fiscal Agent. The Fiscal Agent is hereby authorized, in making or disposing
42831645.7 25
of any investment permitted by this Section, to deal with itself (in its individual capacity) or with any one
or more of its affiliates, whether it or such affiliate is acting as an agent of the Fiscal Agent or for any
third person or dealing as principal for its own account.
The CFD acknowledges that to the extent regulations of the Comptroller of the Currency or other
applicable regulatory entity grant the CFD the right to receive brokerage confirmations of security
transactions as they occur, the CFD specifically waives receipt of such confirmations for securities
transactions effected by the Fiscal Agent as they occur to the extent permitted by law. The CFD further
understands that trade confirmations for securities transactions effected by the Fiscal Agent will be
available upon request and at no additional cost and other trade confirmations may be obtained from the
applicable broker. The Fiscal Agent will furnish the CFD periodic cash transaction statements which
include detail for all investment transactions effected by the Fiscal Agent hereunder or brokers selected
by the CFD. Upon the CFD's election, such statements will be delivered via the Fiscal Agent's online
service and upon electing such service, paper statements will be provided only upon request. The Fiscal
Agent or any of its affiliates may act as sponsor, advisor or manager in connection with any investments
made by the Fiscal Agent hereunder.
Section 3.12. Additional Series of Bonds. In addition to the 2020 Bonds, the CFD may issue
additional Series of Bonds in such principal amount as shall be determined by the CFD, under a
Supplemental Fiscal Agent Agreement entered into by the CFD and the Fiscal Agent. Any such Series
shall constitute Bonds under this Fiscal Agent Agreement and shall be secured by a lien on the Special
Taxes (other than the Special Taxes to be deposited into the Administrative Expense Fund pursuant to
Section 3.4) and funds pledged for the payment of the Bonds hereunder on a parity with all other Bonds
Outstanding under this Fiscal Agent Agreement. The CFD may issue such additional Series subject to the
following specific conditions precedent:
(1) Compliance. The CFD shall be in compliance with all covenants set forth hereunder and
all Supplemental Fiscal Agent Agreements or shall be in compliance immediately following the issuance
of such Series, and issuance of a Series shall not cause the CFD to exceed the CFD's limitation on debt
(as defined in the Act).
(2) Purpose. The purposes for which such Series of Bonds are to be issued; provided, that the
proceeds of the sale of such Series of Bonds shall be applied only for the purpose of providing funds to
(A) pay the costs of the Project, (B) refund any Bonds issued hereunder, (C) pay capitalized interest on
such Series of Bonds, (D) pay Costs of Issuance incurred in connection with the issuance of such Series
of Bonds, and (D) make any deposit to the Reserve Account required pursuant to paragraph (4) below;
(3) Same Payment Dates. The Supplemental Fiscal Agent Agreement providing for the
issuance of such Series shall provide that interest thereon shall be payable on Interest Payment Dates, and
principal thereof shall be payable on September 1 in any year in which principal is payable on such Series
(provided that there shall be no requirement that any Series pay interest on a current basis).
(4) Separate Funds; Reserve Account Deposit. The Supplemental Fiscal Agent Agreement
providing for the issuance of such Series may provide for the establishment of separate funds and
accounts.
Subject to the provisions of Section 3.7, the Supplemental Fiscal Agent Agreement shall provide
for an amount to be deposited into the Reserve Account of the Special Tax Fund so that the balance on
deposit in the Reserve Account is increased to an amount at least equal to the Reserve Requirement
following the issuance of such Series of Bonds; and an amount at least equal to the Reserve Requirement
shall thereafter be maintained in the Reserve Account. Such deposit shall be made as provided in the
42831645.7 26
Supplemental Fiscal Agent Agreement providing for the issuance of such additional Series and may be
made from the proceeds of the sale of such additional Series or from other funds.
(5) Aggregate Value -to -Lien. The aggregate CFD Value of all Taxable Property on the date
of adoption of the Supplemental Fiscal Agent Agreement authorizing the issuance of such series of Bonds
shall be at least four (4) times the sum of (1) the aggregate principal amount of all Bonds then
Outstanding, plus (11) the aggregate principal amount of the additional Series proposed to be issued, plus
(iii) the aggregate principal amount of any fixed assessment liens on the parcels in the CFD subject to the
levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other
community facilities district bonds then outstanding and payable at least partially from special taxes to be
levied on parcels of land within the CFD (the "Other District Bonds") equal to the aggregate outstanding
principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the
amount of special taxes levied for the Other District Bonds on parcels of land within the CFD subject to
the Special Taxes, and the denominator of which is the total amount of special taxes levied for the Other
District Bonds on all parcels of land against which such special taxes are levied to pay the Other District
Bonds based upon information from the most recent available Fiscal Year.
(6) Undeveloped Property Aggregate Value -to -Lien. The aggregate CFD Value of all
Taxable Property that is designated Undeveloped Property on the date of adoption of the Supplemental
Fiscal Agent Agreement authorizing the issuance of such series of Bonds shall be at least three (3) times
the sum of: (1) the Proportionate Share of the aggregate principal amount of all Bonds then Outstanding,
plus (11) the Proportionate Share of the aggregate principal amount of the additional Series proposed to be
issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels of
Undeveloped Property in the CFD subject to the levy of Special Taxes, plus (iv) the portion of the
aggregate principal amount of any Other District Bonds equal to the aggregate outstanding principal
amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of
special taxes levied for the Other District Bonds on parcels of Undeveloped Property within the CFD, and
the denominator of which is the total amount of special taxes levied for the Other District Bonds on all
parcels of land against which such special taxes are levied to pay the Other District Bonds based upon
information from the most recent available Fiscal Year.
(7) Aggregate Coverage. For each Fiscal Year after issuance of the proposed Series, the
maximum amount of the Special Taxes that may be levied for such Fiscal Year under the Ordinance, this
Fiscal Agent Agreement and any Supplemental Fiscal Agent Agreement on (1) all parcels then classified
as Developed Property or to be classified as Developed Property in the subsequent Fiscal Year based on
the actual issuance of a building permit for new construction and (11) all parcels classified as Undeveloped
Property assuming such Undeveloped Property is taxed as Developed Property based on the expected
development for each such parcel, both not then delinquent in the payment of any prior or current years'
Special Taxes, less the Administrative Expense Requirement for each respective Fiscal Year, shall be at
least 110% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Series of
Bonds for each Bond Year that commences in each such Fiscal Year.
(8) Developed Property Coverage. For each Fiscal Year after issuance of the proposed
Series, the Assigned Special Taxes that may be levied for such Fiscal Year under the Ordinance, this
Fiscal Agent Agreement and any Supplemental Fiscal Agent Agreement on all parcels classified as
Developed Property or to be classified as Developed Property in the subsequent Fiscal Year based on the
actual issuance of a building permit for new construction, both of which not then delinquent in the
payment of any prior or current years' Special Taxes, less the Administrative Expense Requirement for
each respective Fiscal Year, shall be at least [45%] of the total Annual Debt Service of the then
Outstanding Bonds and the proposed Series of Bonds for each Bond Year that commences in each such
Fiscal Year.
42831645.7 27
(9) Certificates. The CFD shall deliver to the Fiscal Agent a Certificate of Authorized
Representative of the CFD certifying that the conditions precedent to the issuance of such Series set forth
in paragraphs (1) through (8) above have been satisfied.
(10) Opinion. An Opinion of Bond Counsel to the effect that execution of the Supplemental
Fiscal Agent Agreement has been duly authorized by the CFD in accordance with this Fiscal Agent
Agreement and that such Series, when duly executed by the CFD and authenticated and delivered by the
Fiscal Agent, will be valid and binding obligations of the CFD.
Notwithstanding the foregoing, the CFD may issue Refunding Bonds to refund all or a portion of
one or more Series without the need to satisfy the requirements of paragraphs (5) through (8) above, and,
in connection therewith, the Certificate of Authorized Representative of the CFD in paragraph (9) above
need not make reference to paragraphs (5) through (8); provided a certification is made that Maximum
Annual Debt Service on all Outstanding Bonds following the issuance of such Refunding Bonds is less
than or equal to Maximum Annual Debt Service on all Outstanding Bonds prior to the issuance of such
Refunding Bonds.
Nothing in this Fiscal Agent Agreement prohibits the CFD from issuing any other bonds or
otherwise incurring debt secured by a pledge of the Special Taxes (other than the Special Taxes to be
deposited into the Administrative Expense Fund pursuant to Section 3.4.) subordinate to the pledge
thereof under this Fiscal Agent Agreement.
ARTICLE IV
REDEMPTION OF BONDS
Section 4.1. Redemption of 2020 Bonds.
(1) Optional Redemption. The 2020 Bonds are subject to redemption prior to maturity at the
option of the CFD on any Interest Payment Date on or after September 1, 2027, as a whole or in part, by
lot, from any available source of funds at the following redemption prices (expressed as a percentage of
the principal amount of 2020 Bonds to be redeemed), together with accrued interest thereon to the date
fixed for redemption:
Redemption Dates Redemption Prices
September 1, 2027 and March 1, 2028 102%
September 1, 2028 and March 1, 2029 101
September 1, 2029 and every March 1 and September 1 thereafter 100
(2) Special Mandatory Redemption from Special Tax Prepayments. The 2020 Bonds are
subject to mandatory redemption prior to maturity on any Interest Payment Date on or after September 1,
2020, as a whole or in part, in a manner determined by the CFD from prepayments of Special Taxes at the
following redemption prices (expressed as a percentage of the principal amount of 2020 Bonds to be
redeemed), together with accrued interest thereon to the date fixed for redemption:
42831645.7 28
Redemption Dates Redemption Prices
September 1, 2020 and every March 1 and September 1
through and including March 1, 2027 103%
September 1, 2027 and March 1, 2028 102
September 1, 2028 and March 1, 2029 101
September 1, 2029 and every March 1 and September 1 100
thereafter
In connection with such redemption, the CFD may also apply amounts in the Reserve Account
which will be in excess of the Reserve Requirement as a result of such Special Tax prepayment to redeem
2020 Bonds as set forth above and in accordance with Section G of the RMA.
In the event the CFD elects to redeem 2020 Bonds as provided above in (1) and (2), the CFD
shall give written notice to the Fiscal Agent of its election to so redeem, the redemption date and the
principal amount of the 2020 Bonds of each maturity to be redeemed. The notice to the Fiscal Agent shall
be given at least 30 but no more than 90 days prior to the redemption date, or by such later date as is
acceptable to the Fiscal Agent, in its sole discretion.
(3) Mandatory Sinking Fund Redemption. The Term 2020 Bonds maturing on September 1,
20 , and on September 1, 20 are subject to mandatory redemption, in part by lot, on September 1 in
each year commencing September 1, 20 with respect to the Term 2020 Bonds maturing on September
1, 20 , and commencing September 1, 20 with respect to the Term 2020 Bonds maturing on
September 1, 20 , from the Sinking Fund Payments that have been deposited into the Redemption
Account at a redemption price equal to the principal amount thereof to be redeemed, without premium,
plus accrued interest thereon to the date of redemption as set forth in the following schedule; provided,
however, that (1) in lieu of redemption thereof, the Term 2020 Bonds may be purchased by the CFD and
tendered to the Fiscal Agent, and (11) if some but not all of the Term 2020 Bonds have been redeemed
pursuant to Sections 4.1(1) and (2) above, the total amount of all future sinking payments will be reduced
by the aggregate principal amount of the Term 2020 Bonds so redeemed, to be allocated among such
sinking payments on a pro rata basis (as nearly as practicable) in integral multiples of $5,000 as
determined by the CFD.
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1) Principal Amount
(maturity)
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1)
(maturity)
Principal Amount
42831645.7 29
Section 4.2. Selection of Bonds for Redemption. If less than all of the Bonds Outstanding
are to be redeemed, the portion of any Bond of a denomination of more than the Authorized
Denomination to be redeemed shall be in the principal amount of the Authorized Denomination. In
selecting portions of such Bonds for redemption, the Fiscal Agent shall treat such Bonds as representing
that number of Bonds of Authorized Denominations which is obtained by dividing the principal amount
of such Bonds to be redeemed in part by the Authorized Denomination. The Fiscal Agent shall promptly
notify the CFD in writing of the Bonds, or portions thereof, selected for redemption.
Section 4.3. Notice of Redemption. When Bonds are due for redemption under Section 4.1
above, the Fiscal Agent shall give notice, in the name of the CFD, of the redemption of such Bonds. Such
notice of redemption shall (a) specify the CUSIP numbers (if any), the bond numbers, the Series and the
maturity date or dates of the Bonds selected for redemption, except that where all of the Bonds of a Series
of a maturity are subject to redemption, or all the Bonds of a Series of one maturity, are to be redeemed,
the bond numbers of such issue need not be specified; (b) state the date fixed for redemption and
surrender of the Bonds to be redeemed; (c) state the redemption price; (d) state the place or places where
the Bonds are to be redeemed; (e) in the case of Bonds to be redeemed only in part, state the portion of
such Bond which is to be redeemed; (f) state the date of issue of the Series of Bonds as originally issued;
(g) state the rate of interest borne by each Bond being redeemed; and (h) state any other descriptive
information needed to identify accurately the Bonds being redeemed as shall be specified by the Fiscal
Agent. Such notice shall further state that on the date fixed for redemption, there shall become due and
payable on each Bond, or portion thereof called for redemption, the principal thereof, together with any
premium, and interest accrued to the redemption date, and that from and after such date, interest thereon
shall cease to accrue and be payable. At least 20 days but no more than 60 days prior to the redemption
date, the Fiscal Agent shall mail a copy of such notice, by first class mail, postage prepaid, to the
respective Owners of such Series to be redeemed at their addresses appearing on the Bond Register.
In addition to the foregoing, the Fiscal Agent shall send a notice of redemption at least 20 days
prior to the redemption date (1) by registered or certified mail, postage prepaid, by overnight delivery
service, or in such other manner as is acceptable to such institutions, to each of the Securities Depositories
and (11) electronically, to the Municipal Securities Rulemaking Board, through its Electronic Municipal
Market Access ("EMMA") database maintained by the Securities and Exchange Commission.
The actual receipt by the Owner of any Bond or the original purchaser of any Bond of notice of
such redemption shall not be a condition precedent to redemption, and neither the failure to receive nor
any defect in such notice shall affect the validity of the proceedings for the redemption of such Bonds, or
the cessation of interest on the redemption date. A certificate by the Fiscal Agent that notice of such
redemption has been given as herein provided shall be conclusive as against all parties and the Owner
shall not be entitled to show that he or she failed to receive notice of such redemption.
If at the time of mailing of any notice of optional redemption there shall not have been deposited
with the Fiscal Agent moneys sufficient to redeem all the Bonds called for redemption, such notice shall
state that it is subject to the deposit of the redemption moneys with the Fiscal Agent not later than the
opening of business on the redemption date and will be of no effect unless such moneys are so deposited.
The CFD shall have the right to rescind any notice of optional redemption by written notice to the
Fiscal Agent on or prior to the date fixed for redemption. Any notice of such redemption shall be
cancelled and annulled if for any reason funds will not be or are not available on the date fixed for
redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall
not constitute an Event of Default hereunder. The CFD and the Fiscal Agent shall have no liability to the
Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent
42831645.7 30
shall mail notice of such rescission of redemption in the same manner as the original notice of redemption
was sent.
Upon the payment of the redemption price of any Bonds being redeemed, each check or other
transfer of funds issued for such purpose shall to the extent practicable bear the CUSIP number
identifying, by Series, issue and maturity, the Bonds being redeemed with the proceeds of such check or
other transfer.
Section 4.4. Partial Redemption of Bonds. Upon surrender of any Bond to be redeemed in
part only, the CFD shall execute and the Fiscal Agent shall authenticate and deliver to the Bondowner, at
the expense of the CFD, a new Bond or Bonds of Authorized Denominations equal in aggregate principal
amount to the unredeemed portion of the Bonds surrendered, with the same interest rate and the same
Series and maturity.
Section 4.5. Effect of Notice and Availability of Redemption Money. Notice of
redemption having been duly given, as provided in Section 4.3 hereof, and the amount necessary for the
redemption having been made available for that purpose and being available therefor on the date fixed for
such redemption:
(1) The Bonds, or portions thereof, designated for redemption shall, on the date fixed for
redemption, become due and payable at the redemption price thereof as provided in this Fiscal Agent
Agreement, anything in this Fiscal Agent Agreement or in the Bonds to the contrary notwithstanding;
(2) Upon presentation and surrender thereof at the office of the Fiscal Agent, the redemption
price of such Bonds shall be paid to the Owners thereof,
(3) As of the redemption date the Bonds, or portions thereof so designated for redemption
shall be deemed to be no longer Outstanding and such Bonds, or portions thereof, shall cease to bear
further interest; and
(4) As of the date fixed for redemption no Owner of any of the Bonds, or portions thereof so
designated for redemption, shall be entitled to any of the benefits of this Fiscal Agent Agreement or any
Supplemental Fiscal Agent Agreement, or to any other rights, except with respect to payment of the
redemption price and interest accrued to the redemption date from the amounts so made available.
ARTICLE V
COVENANTS AND WARRANTY
Section 5.1. Warranty. The CFD shall preserve and protect the security pledged hereunder
to the Bonds against all claims and demands of all persons.
Section 5.2. Covenants. So long as any of the Bonds issued hereunder are Outstanding and
unpaid, the CFD makes the following covenants with the Bondowners under the provisions of the Act and
this Fiscal Agent Agreement (to be performed by the CFD or its proper officers, agents or employees),
which covenants are necessary and desirable to secure the Bonds and tend to make them more
marketable; provided, however, that said covenants do not require the CFD to expend any funds or
moneys other than the Special Taxes and other amounts deposited to the Special Tax Fund:
(1) Punctual Payment; Against Encumbrances. The CFD hereby covenants that it will
receive all Special Taxes in trust and will within ten (10) Business Days of receipt of Special Taxes
42831645.7 31
deposit such amounts with the Fiscal Agent, and the CFD shall have no beneficial right or interest in the
amounts so deposited except as provided by this Fiscal Agent Agreement. All such Special Taxes shall
be disbursed, allocated and applied solely to the uses and purposes set forth herein, and shall be accounted
for separately and apart from all other money, funds, accounts or other resources of the CFD.
The CFD covenants that it will duly and punctually pay or cause to be paid the principal of and
interest on every Bond issued hereunder, together with the premium, if any, thereon on the date, at the
place and in the manner set forth in the Bonds and in accordance with this Fiscal Agent Agreement to the
extent that Special Taxes are available therefor, and that the payments into the Funds and Accounts
created hereunder will be made, all in strict conformity with the terms of the Bonds and this Fiscal Agent
Agreement, and that it will faithfully observe and perform all of the conditions, covenants and
requirements of this Fiscal Agent Agreement and all Supplemental Fiscal Agent Agreements and of the
Bonds issued hereunder.
The CFD will not mortgage or otherwise encumber, pledge or place any charge upon any of the
Special Taxes except as provided in this Fiscal Agent Agreement, and will not issue any obligation or
security having a lien or charge upon the Special Taxes superior to the Bonds. Nothing herein shall
prevent the CFD from issuing or incurring indebtedness which is payable from a pledge of Special Taxes
which is subordinate in all respects to the pledge of Special Taxes to repay the Bonds.
(2) Levy of Special Tax. So long as any Bonds issued under this Fiscal Agent Agreement
are Outstanding, the CFD hereby covenants to levy the Special Tax in an amount sufficient, together with
other amounts on deposit in the Special Tax Fund and available for such purpose, to pay (1) the principal
of and interest on the Bonds when due, (2) the Administrative Expenses, and (3) any amounts required to
replenish the Reserve Account of the Special Tax Fund to the Reserve Requirement.
(3) Collection of Special Taxes. The CFD shall comply with all requirements of the Act so
as to assure the timely collection of Special Taxes, including without limitation, the enforcement of
delinquent Special Taxes.
The Treasurer shall effect the levy of the Special Taxes each Fiscal Year on the parcels within the
CFD in accordance with the Ordinance, such that the computation of the levy is complete before the final
date on which the Auditor will accept the transmission of the Special Tax amounts for the parcels within
the CFD for inclusion on the next secured tax roll. Upon the completion of the computation of the
amounts of the levy, the Treasurer shall prepare or cause to be prepared, and shall transmit to the Auditor,
such data as the Auditor requires to include the levy of the Special Taxes on the next secured tax roll.
The Special Taxes so levied shall be payable and be collected in the same manner and at the same time
and in the same installments as the general taxes on real property are payable, and have the same priority,
become delinquent at the same time and in the same proportionate amounts and bear the same
proportionate penalties and interest after delinquency as do the general taxes on real property, unless
otherwise provided by the CFD.
In the event that the Treasurer determines to levy all or a portion of the Special Taxes by means
of direct billing of the property owners of the parcels within the CFD, the Treasurer shall, not less than
forty-five (45) days prior to each Interest Payment Date, send bills to the owners of such real property
located within the CFD subject to the levy of the Special Taxes for Special Taxes in an aggregate amount
necessary to meet the financial obligations of the CFD due on the next Interest Payment Date, said bills to
specify that the amounts so levied shall be due and payable not less than thirty (30) days prior to such
Interest Payment Date and shall be delinquent if not paid when due.
42831645.7 32
In any event, the Treasurer shall fix and levy the amount of Special Taxes within the CFD
required (1) for the payment of principal of and interest on any outstanding Bonds of the CFD becoming
due and payable during the ensuing year (taking into consideration anticipated delinquencies), and (11) to
pay the Administrative Expenses during such year, all in accordance with the RMA and the Ordinance.
The Special Taxes so levied shall not exceed the authorized amounts as provided in the proceedings
pursuant to the Resolution of Formation.
The Treasurer is hereby authorized to employ consultants to assist in computing the levy of the
Special Taxes hereunder and any reconciliation of amounts levied to amounts received. The fees and
expenses of such consultants and the costs and expenses of the Treasurer (including a charge for City or
CFD staff time) in conducting its duties hereunder shall be an Administrative Expense hereunder.
(4) Commence Foreclosure Proceedings. The CFD hereby covenants for the benefit of the
Owners of the Bonds that it (1) will commence judicial foreclosure proceedings against all parcels owned
by a property owner where the aggregate delinquent Special Taxes on such parcels is greater than $25,000
not later than ninety (90) days following the date in which such Special Taxes were due and (11) will
commence judicial foreclosure proceedings against all parcels with delinquent Special Taxes not later
than ninety (90) days following the date in which such Special Taxes were due where it receives Special
Taxes in an amount which is less than 95% of the total Special Tax due from properties within the CFD,
and (111) will diligently pursue such foreclosure proceedings until the delinquent Special Taxes are paid.
The CFD may, but is not obligated to, advance funds from any source of legally available funds in order
to maintain the Reserve Account of the Special Tax Fund at the Reserve Requirement.
Commencement of any judicial foreclosure proceedings includes the CFD's efforts to collect the
delinquent Special Taxes by sending subsequent notice of delinquency and a demand for immediate
payment thereof The CFD may treat any delinquent Special Tax sold to an independent third -party or to
any funds of the City for at least 100% of the delinquent amount as having been paid. Proceeds of any
such sale up to 100% of the delinquent amount shall be deposited in the Special Tax Fund. The City
Attorney is hereby authorized to employ counsel to conduct any such foreclosure proceedings. The fees
and expenses of any such counsel and costs and expenses of the City Attorney (including a charge for
City or CFD staff time) in conducting foreclosure proceedings shall be an Administrative Expense
hereunder.
Notwithstanding any provision of the Act or other law of the State to the contrary, in connection
with any foreclosure related to delinquent Special Taxes:
(a) The CFD is hereby expressly authorized to credit bid at any foreclosure sale,
without any requirement that funds be set aside in the amount so credit bid, in the amount
specified in Section 53356.5 of the Act, or such lesser amount as determined under clause (b)
below or otherwise under Section 53356.6 of the Act.
(b) The CFD may permit, in its sole and absolute discretion, property with
delinquent Special Taxes to be sold for less than the amount specified in Section 53356.5 of the
Act, if it determines that such sale is in the interest of the Owners. The Owners, by their
acceptance of the Bonds, hereby consent to such sale for such lesser amounts (as such consent is
described in Section 53356.6 of the Act), and hereby release the CFD, and its officers and agents
from any liability in connection therewith.
(c) The CFD is hereby expressly authorized to use amounts in the Administrative
Expense Fund or the Surplus Fund to pay costs of foreclosure of delinquent Special Taxes.
42831645.7 33
(5) Payment of Claims. The CFD will pay and discharge any and all lawful claims for labor,
materials or supplies which, if unpaid, might become a lien or charge upon the Special Taxes or; other
funds in the Special Tax Fund (exclusive of amounts transferred to the Administrative Expense Fund), or
which might impair the security of the Bonds then Outstanding; provided that nothing herein contained
shall require the CFD to make any such payments so long as the CFD in good faith shall contest the
validity of any such claims.
(6) Books and Accounts. The CFD will keep proper books of records and accounts, separate
from all other records and accounts of the CFD, in which complete and correct entries shall be made of all
transactions relating to the levy of the Special Tax and the deposits to the Special Tax Fund. Such books
of records and accounts shall at all times during business hours be subject to the inspection of the Owners
of the Bonds then Outstanding or their representatives authorized in writing.
(7) Tax Covenants.
(a) Special Definitions. When used in this subsection, the following terms have the
following meanings:
"Closing Date" with respect to a Series of Bonds means the date on which such Bonds are first
authenticated and delivered to the initial purchasers against payment therefor.
"Code" means the Internal Revenue Code of 1986.
"Computation Date" has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
"Gross Proceeds" means any proceeds as defined in section 1.148-1(b) of the Tax Regulations
(referring to sales, investment and transferred proceeds), and any replacement proceeds as defined in
section 1.148-1(c) ofthe Tax Regulations, of a Series of Bonds.
"Investment" has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
"Nonpurpose Investment" means any investment property, as defined in section 148(b) of the
Code, in which Gross Proceeds of the Bonds are invested and that is not acquired to carry out the
governmental purposes of that series of Bonds.
"Rebate Amount," has the meaning set forth in section 1.148-1(b) of the Tax Regulations.
"Tax Regulations" means the United States Treasury Regulations promulgated pursuant to
sections 103 and 141 through 150 of the Code, or section 103 of the 1954 Code, as applicable.
"Yield" of any Investment has the meaning set forth in section 1.148-5 of the Tax Regulations;
and of any issue of governmental obligations has the meaning set forth in section 1.148-4 of the Tax
Regulations.
(b) Not to Cause Interest to Become Taxable. The CFD covenants that it shall take
all actions necessary in order that interest on the Bonds be and remain excluded pursuant to
section 103(a) of the Code from the gross income of the owners thereof for federal income tax
purposes, and that it shall not use or invest, and shall not permit the use or investment of, and
shall not omit to use or invest Gross Proceeds or any other amounts (or any property the
acquisition, construction or improvement of which is to be financed directly or indirectly with
Gross Proceeds) in a manner that if made or omitted, respectively, could cause the interest on any
42831645.7 34
Bond to fail to be excluded pursuant to section 103(a) of the Code from the gross income of the
owner thereof for federal income tax purposes. Without limiting the generality of the foregoing,
unless and until the CFD receives a written opinion of Bond Counsel to the effect that compliance
with such covenant is not necessary to, or that failure to comply with such covenant will not
adversely affect, the exclusion of the interest on any Bond from the gross income of the owner
thereof for federal income tax purposes, the CFD shall comply with each of the specific
covenants in this subsection. Provided, however, that, prior to the issuance of any Series of
Bonds, the CFD may exclude the application of the covenants in this Section 5.2(6) to such Series
of Bonds.
(c) Private Use and Private Pam. Except as would not cause any Bond to
become a "private activity bond" within the meaning of section 141 of the Code and the Tax
Regulations, the CFD shall take all actions necessary to assure that the CFD at all times prior to
the final cancellation of the last of the Bonds to be retired:
(1) exclusively owns, operates and possesses all property the acquisition,
construction or improvement of which is to be financed or refinanced directly or
indirectly with Gross Proceeds of the Bonds and not use or permit the use of such Gross
Proceeds (including through any contractual arrangement with terms different than those
applicable to the general public) or any property acquired, constructed or improved with
such Gross Proceeds in any activity carried on by any person or entity (including the
United States or any agency, department and instrumentality thereof) other than a state or
local government, unless such use is solely as a member of the general public; and
(11) does not directly or indirectly impose or accept any charge or other
payment by any person or entity (other than a state or local government) who is treated as
using any Gross Proceeds of the Bonds or any property the acquisition, construction or
improvement of which is to be financed or refinanced directly or indirectly with such
Gross Proceeds.
(d) No Private Loan. Except as would not cause any Bond to become a "private
activity bond" within the meaning of section 141 of the Code and the Tax Regulations and rulings
thereunder, the CFD shall not use or permit the use of Gross Proceeds of the Bonds to make or
finance loans to any person or entity other than a state or local government. For purposes of the
foregoing covenant, such Gross Proceeds are considered to be "loaned" to a person or entity if (1)
property acquired, constructed or improved with such Gross Proceeds is sold or leased to such
person or entity in a transaction that creates a debt for federal income tax purposes; (11) capacity
in or service from such property is committed to such person or entity under a take -or -pay, output
or similar contract or arrangement; or (111) indirect benefits of such Gross Proceeds, or burdens
and benefits of ownership of any property acquired, constructed or improved with such Gross
Proceeds, are otherwise transferred in a transaction that is the economic equivalent of a loan.
(e) Not to Invest at Higher Yield. Except as would not cause a Series of Bonds to
become "arbitrage bonds" within the meaning of section 148 of the Code and the Tax Regulations
and rulings thereunder, the CFD shall not (and shall not permit any person to), at any time prior to
the final cancellation of the last such Series to be retired, directly or indirectly invest Gross
Proceeds in any Investment, if as a result of such investment the Yield of any Investment
acquired with Gross Proceeds, whether then held or previously disposed of, would materially
exceed the Yield of such Series of Bonds within the meaning of said section 148.
42831645.7 35
(f) Not Federally Guaranteed. Except to the extent permitted by section 149(b) of
the Code and the Tax Regulations and rulings thereunder, the CFD shall not take or omit to take
(and shall not permit any person to take or omit to take) any action that would cause any Bond of
a Series to be "federally guaranteed" within the meaning of section 149(b) of the Code and the
Tax Regulations and rulings thereunder.
(g) Information Report. The CFD shall timely file any information required by
section 149(e) of the Code with respect to a Series of Bonds with the Secretary of the Treasury on
Form 8038-G or such other form and in such place as the Secretary may prescribe.
(h) Rebate of Arbitrage Profits. Except to the extent otherwise provided in section
148(f) of the Code and the Tax Regulations, with respect to each Series of Bonds:
(1) The CFD shall account for all Gross Proceeds (including all receipts,
expenditures and investments thereof) on its books of account separately and apart from
all other funds (and receipts, expenditures and investments thereof) and shall retain all
records of accounting for at least six years after the day on which the last Bond of such
Series is discharged. However, to the extent permitted by law, the CFD may commingle
(and may allow the CFD to commingle) Gross Proceeds of Bonds with its other monies,
provided that it separately accounts for each receipt and expenditure of Gross Proceeds
and the obligations acquired therewith.
(11) Not less frequently than each Computation Date, the CFD shall calculate
the Rebate Amount in accordance with rules set forth in section 148(f) of the Code and
the Tax Regulations and rulings thereunder. The CFD shall maintain a copy of the
calculation with its official transcript of proceedings relating to the issuance of such
Series of Bonds until six years after the final Computation Date.
(111) In order to assure the excludability pursuant to 3(a) of the Code of the
interest on each Series of Bonds from the gross income of the owners thereof for federal
income tax purposes, the CFD shall pay to the United States the amount that when added
to the future value of previous rebate payments made for such Series of Bonds equals (1)
in the case of the Final Computation Date as defined in section 1.148-3(e)(2) of the Tax
Regulations, one hundred percent (100%) of the Rebate Amount on such date; and (n) in
the case of any other Computation Date, ninety percent (90%) of the Rebate Amount on
such date. In all cases, such rebate payments shall be made by the CFD at the times and
in the amounts as are or may be required by section 148(f) of the Code and the Tax
Regulations and rulings thereunder, and shall be accompanied by Form 8038-T or such
other forms and information as is or may be required by section 148(f) of the Code and
the Tax Regulations and rulings thereunder for execution and filing by the CFD.
Notwithstanding the foregoing, and provided that the CFD takes all steps available to it to
cause the provision of such amounts, the monetary obligation of the CFD under this
paragraph (3) shall be limited to amounts provided to it for such purpose by the CFD.
(1) Not to Divert Arbitrage Profits. Except to the extent permitted by section 148 of
the Code and the Tax Regulations and rulings thereunder, the CFD shall not and shall not permit
any person to, at any time prior to the final cancellation of the last of the Bonds to be retired,
enter into any transaction that reduces the amount required to be paid to the United States
pursuant to paragraph (h) of this subsection because such transaction results in a smaller profit or
a larger loss than would have resulted if the transaction had been at arm's length and had the
Yields on the Bonds not been relevant to either party.
42831645.7 36
0) Bonds Not Hedge Bonds.
(1) The CFD represents that none of the Bonds is or will become a "hedge
bond" within the meaning of section 149(g) of the Code.
(11) Without limitation of paragraph (1) above: (A) the CFD reasonably
expects that at least 85% of the spendable proceeds of the Bonds will be expended within
the three-year period commencing on the date of issuance of the Bonds; and (B) no more
than 50% of the proceeds of the Bonds will be invested in Nonpurpose Investments
having a substantially guaranteed yield for a period of four years or more.
(k) Elections. The CFD hereby directs and authorizes any CFD Authorized
Representative to make elections permitted or required pursuant to the provisions of the Code or
the Tax Regulations, as such representative (after consultation with Bond Counsel) deems
necessary or appropriate in connection with the Bonds, in the Certificate as to Tax Exemption or
similar or other appropriate certificate, form or document.
(1) Closing Certificate. The CFD agrees to execute and deliver in connection with
the issuance of the Bonds a Tax Certificate as to Arbitrage and the Provisions of Sections 103 and
141-150 of the Internal Revenue Code of 1986, or similar document containing additional
representations and covenants pertaining to the exclusion of interest on the Bonds from the gross
income of the owners thereof for federal income tax purposes, which representations and
covenants are incorporated as though expressly set forth herein.
(8) Protection of Security and Rights of Owners. The CFD will preserve and protect the
security of the Bonds and the rights of the Owners, and will warrant and defend their rights against all
claims and demands of all persons. From and after the delivery of any of the Bonds by the CFD, the
Bonds shall be incontestable by the CFD. In furtherance of the foregoing, the CFD shall not approve any
reduction of the maximum Special Taxes as provided in the RMA which would prohibit the CFD from
levying the Special Taxes in any Fiscal Year at a level that would generate Special Tax Revenues at least
equal to the estimated Administrative Expenses plus 110% of annual debt service in such Fiscal Year for
the Outstanding Bonds. The CFD shall also not permit the tender of Bonds in payment of any Special
Taxes except upon receipt of a certificate of an Independent Financial Consultant that to accept such
tender will not result in the CFD having insufficient Special Taxes to pay the principal of and interest on
the Bonds remaining Outstanding when due following such tender.
(9) Covenants to Defend. The CFD hereby covenants that in the event that any initiative is
adopted by the qualified electors in the CFD which purports to reduce the maximum Special Tax below
the levels specified in Section 5.2(8) above or to limit the power of the CFD to levy the Special Taxes for
the purposes set forth in Section 5.2(2) above, it will commence and pursue legal action in order to
preserve its ability to comply with such covenants.
(10) Annual Reports to CDIAC. Not later than October 30 of each year, commencing
October 30, 2020 and until the October 30 following the final maturity of the Bonds, the CFD shall cause
the City to supply the information required by Section 53359.5(b) or (c) of the Act to CDIAC (on such
forms as CDIAC may specify).
(11) Accountability Measures. The CFD shall comply with the requirements of Section 53410
and 53411 of the California Government Code and shall cause the appropriate officer of the City to file a
report with the City Council no later than each January 1 with respect to the amount of funds collected
and expended with respect to the CFD.
42831645.7 37
(12) Continuing Disclosure. The CFD hereby covenants to comply with the terms of the
Continuing Disclosure Certificate executed by it with respect to the Bonds. Notwithstanding any other
provision of this Fiscal Agent Agreement, failure of the CFD to comply with the Continuing Disclosure
Certificate shall not be considered a default hereunder; however, any Underwriter or any holder or
beneficial owner of the Bonds may take such actions as may be necessary and appropriate to compel
performance by the CFD of its obligations under this Section 5.2(12), including seeking mandate or
specific performance by court order.
ARTICLE VI
AMENDMENTS TO FISCAL AGENT AGREEMENT
Section 6.1. Supplemental Fiscal Agent Agreements or Orders Not Requiring
Bondowner Consent. The CFD may from time to time, and at any time, without notice to or consent of
any of the Bondowners, adopt Supplemental Fiscal Agent Agreements for any of the following purposes:
(1) to provide for the issuance of an additional Series of Bonds in accordance with Section
3.12;
(2) to cure any ambiguity, to correct or supplement any provisions herein which may be
inconsistent with any other provision herein, or to make any other provision with respect to matters or
questions arising under this Fiscal Agent Agreement or in any additional resolution or order, provided
that such action is not materially adverse to the interests of the Bondowners;
(3) to add to the covenants and agreements of and the limitations and the restrictions upon
the CFD contained in this Fiscal Agent Agreement, other covenants, agreements, limitations and
restrictions to be observed by the CFD which are not contrary to or inconsistent with this Fiscal Agent
Agreement as theretofore in effect or which further secure Bond payments;
(4) to modify, amend or supplement this Fiscal Agent Agreement in such manner as to
permit the qualification hereof under the Trust Indenture Act of 1939, as amended, or any similar federal
statute hereafter in effect, or to comply with the Code or regulations issued thereunder, and to add such
other terms, conditions and provisions as may be permitted by said act or similar federal statute, and
which shall not materially adversely affect the interests of the Owners of the Bonds then Outstanding;
(5) to modify, alter or amend the RMA in any manner so long as such changes do not reduce
the maximum Special Taxes that may be levied in each year on property within the CFD to an amount
which is less than that permitted under Section 5.2(7) hereof, or
(6) to modify, alter, amend or supplement this Fiscal Agent Agreement in any other respect
which is not materially adverse to the Bondowners.
Section 6.2. Supplemental Fiscal Agent Agreements or Orders Requiring Bondowner
Consent. Exclusive of the Supplemental Fiscal Agent Agreements described in Section 6.1, the Owners
of not less than a majority in aggregate principal amount of the Bonds Outstanding shall have the right to
consent to and approve the adoption by the CFD of such Supplemental Fiscal Agent Agreements as shall
be deemed necessary or desirable by the CFD for the purpose of waiving, modifying, altering, amending,
adding to or rescinding, in any particular, any of the terms or provisions contained in this Fiscal Agent
Agreement; provided, however, that nothing herein shall permit, or be construed as permitting, (a) an
extension of the maturity date of the principal, or the payment date of interest on, any Bond, (b) a
reduction in the principal amount of, or redemption premium on, any Bond or the rate of interest thereon,
42831645.7 38
(c) a preference or priority of any Bond over any other Bond, or (d) a reduction in the aggregate principal
amount of the Bonds the Owners of which are required to consent to such Supplemental Fiscal Agent
Agreement, without the consent of the Owners of all Bonds then Outstanding.
If at any time the CFD shall desire to adopt a Supplemental Fiscal Agent Agreement, which
pursuant to the terms of this Section shall require the consent of the Bondowners, the CFD shall so notify
the Fiscal Agent and shall deliver to the Fiscal Agent a copy of the proposed Supplemental Fiscal Agent
Agreement. The Fiscal Agent shall, at the expense of the CFD, cause notice of the proposed
Supplemental Fiscal Agent Agreement to be mailed, by first class mail, postage prepaid, to all
Bondowners at their addresses as they appear in the Bond Register. Such notice shall briefly set forth the
nature of the proposed Supplemental Fiscal Agent Agreement and shall state that a copy thereof is on file
at the office of the Fiscal Agent for inspection by all Bondowners. The failure of any Bondowners to
receive such notice shall not affect the validity of such Supplemental Fiscal Agent Agreement when
consented to and approved by the Owners of not less than a majority in aggregate principal amount of the
Bonds Outstanding as required by this Section. Whenever at any time within one year after the date of
the first mailing of such notice, the Fiscal Agent shall receive an instrument or instruments purporting to
be executed by the Owners of a majority in aggregate principal amount of the Bonds Outstanding, which
instrument or instruments shall refer to the proposed Supplemental Fiscal Agent Agreement described in
such notice, and shall specifically consent to and approve the adoption thereof by the CFD substantially in
the form of the copy referred to in such notice as on file with the Fiscal Agent, such proposed
Supplemental Fiscal Agent Agreement, when duly adopted by the CFD, shall thereafter become a part of
the proceedings for the issuance of the Bonds. In determining whether the Owners of a majority of the
aggregate principal amount of the Bonds have consented to the adoption of any Supplemental Fiscal
Agent Agreement, Bonds which are owned by the CFD or by any person directly or indirectly controlling
or controlled by or under the direct or indirect common control with the CFD shall be disregarded and
shall be treated as though they were not Outstanding for the purpose of any such determination.
Upon the adoption of any Supplemental Fiscal Agent Agreement and the receipt of consent to any
such Supplemental Fiscal Agent Agreement from the Owners of not less than a majority in aggregate
principal amount of the Outstanding Bonds in instances where such consent is required pursuant to the
provisions of this Section, this Fiscal Agent Agreement shall be, and shall be deemed to be, modified and
amended in accordance therewith, and the respective rights, duties and obligations under this Fiscal Agent
Agreement of the CFD and all Owners of Outstanding Bonds shall thereafter be determined, exercised
and enforced hereunder, subject in all respects to such modifications and amendments.
Section 6.3. Notation of Bonds; Delivery of Amended Bonds. After the effective date of
any action taken as hereinabove provided, the CFD may determine that the Bonds may bear a notation, by
endorsement in form approved by the CFD, as to such action, and in that case upon demand of the Owner
of any Outstanding Bond at such effective date and presentation of his Bond for the purpose at the office
of the Fiscal Agent or at such additional offices as the Fiscal Agent may select and designate for that
purpose, a suitable notation as to such action shall be made on such Bonds. If the CFD shall so
determine, new Bonds so modified as, in the opinion of the CFD, shall be necessary to conform to such
action shall be prepared and executed, and in that case upon demand of the Owner of any Outstanding
Bond at such effective date such new Bonds shall be exchanged at the office of the Fiscal Agent or at
such additional offices as the Fiscal Agent may select and designate for that purpose, without cost to each
Owner of Outstanding Bonds, upon surrender of such Outstanding Bonds.
42831645.7 39
ARTICLE VII
FISCAL AGENT
Section 7.1. Fiscal Agent. U.S. Bank National Association, a national banking association
shall be the Fiscal Agent for the Bonds unless and until another Fiscal Agent is appointed by the CFD
hereunder. The CFD may, at any time, provided that no Event of Default has occurred and is continuing,
appoint a successor Fiscal Agent satisfying the requirements of Section 7.2 below for the purpose of
receiving all money which the CFD is required to deposit with the Fiscal Agent hereunder and to allocate,
use and apply the same as provided in this Fiscal Agent Agreement.
The Fiscal Agent is hereby authorized to and shall mail by first class mail, postage prepaid, or
wire transfer in accordance with Section 2.5 above, interest payments to the Bondowners, to select Bonds
for redemption, and to maintain the Bond Register. The Fiscal Agent is hereby authorized to pay the
principal of and premium, if any, on the Bonds when the same are duly presented to it for payment at
maturity or on call and redemption, to provide for the registration of transfer and exchange of Bonds
presented to it for such purposes, to provide for the cancellation of Bonds all as provided in this Fiscal
Agent Agreement, and to provide for the authentication of Bonds, and shall perform all other duties
assigned to or imposed on it as provided in this Fiscal Agent Agreement; provided, however, that the
Fiscal Agent undertakes to perform such duties and only such duties as are set forth in this Fiscal Agent
Agreement, and no duties of the Fiscal Agent shall be implied hereunder. Discretionary rights of the
Fiscal Agent under this Fiscal Agent Agreement shall not be construed as duties. The Fiscal Agent may
execute any of the powers hereunder or perform any duties hereunder either directly or by or through
agents or attorneys, and the Fiscal Agent shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed by it with due care hereunder. The Fiscal Agent shall keep
accurate records of all funds administered by it and all Bonds paid, discharged and cancelled by it. The
Fiscal Agent may establish such funds and accounts as it deems necessary to perform its obligations
hereunder.
The Fiscal Agent is hereby authorized to redeem the Bonds when duly presented for payment at
maturity, or on redemption prior to maturity. The Fiscal Agent shall cancel all Bonds upon payment
thereof in accordance with the provisions of Section 10.1 hereof.
Section 7.2. Removal of Fiscal Agent. Provided that no Event of Default has occurred and is
continuing, the CFD may at any time at its sole discretion remove the Fiscal Agent initially appointed,
and any successor thereto, by delivering to the Fiscal Agent a written notice of its decision to remove the
Fiscal Agent and may appoint a successor or successors thereto; provided that any such successor, other
than the Fiscal Agent, shall be a bank or trust company having (or if such bank or trust company is a
member of a bank holding company system its bank holding company has) a combined capital (exclusive
of borrowed capital) and surplus of at least $50,000,000, and subject to supervision or examination by
federal or state Authority. Any removal shall become effective only upon acceptance of appointment by
the successor Fiscal Agent. If any bank or trust company appointed as a successor publishes a report of
condition at least annually, pursuant to law or to the requirements of any supervising or examining
authority above referred to, then for the purposes of this Section the combined capital and surplus of such
bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. Any removal of the Fiscal Agent and appointment of a successor
Fiscal Agent shall become effective only upon acceptance of appointment by the successor Fiscal Agent
and notice being sent by the successor Fiscal Agent to the Bondowners of the successor Fiscal Agent's
identity and address.
42831645.7 40
Section 7.3. Resignation of Fiscal Agent. The Fiscal Agent may at any time resign by
giving written notice to the CFD and by giving to the Owners notice of such resignation, which notice
shall be mailed to the Owners at their addresses appearing in the registration books in the office of the
Fiscal Agent. Upon receiving such notice of resignation, the CFD shall promptly appoint a successor
Fiscal Agent satisfying the criteria in Section 7.2 above by an instrument in writing. Any resignation or
removal of the Fiscal Agent and appointment of a successor Fiscal Agent shall become effective only
upon acceptance of appointment by the successor Fiscal Agent provided, however, that in the event the
CFD does not appoint a successor Fiscal Agent within 30 days following receipt of such notice of
resignation, the resigning Fiscal Agent may, at the expense of the CFD, petition the appropriate court
having jurisdiction to appoint a successor Fiscal Agent.
Section 7.4. Compensation and Liability of Fiscal Agent. The CFD shall from time to
time, subject to any agreement between the CFD and the Fiscal Agent then in force, pay to the Fiscal
Agent compensation for its services, reimburse the Fiscal Agent for all of its advances and expenditures,
including, but not limited to, advances to and reasonable fees and expenses of independent accountants
and counsel and agents employed by it in the exercise and performance of its powers and duties
hereunder. The CFD agrees to indemnify the Fiscal Agent, including its officers, directors, employees
and agents for, and hold it harmless against, any loss, claim, liability or expense incurred which does not
arise from its own negligence or willful misconduct, arising out of or in connection with the
administration of this Fiscal Agent Agreement, including the costs and expenses of defending itself
against any claim or liability in connection with the exercise or performance of any of its powers or duties
hereunder. The Fiscal Agent shall not be liable for any error in judgment made in good faith by a
reasonable officer, unless it shall be proved that the Fiscal Agent was negligent in ascertaining the
pertinent facts. Whether or not therein expressly so provided, every provision of this Fiscal Agent
Agreement relating to the conduct of or affecting the liability of or affording protection to the Fiscal
Agent (acting in its capacity as Fiscal Agent or in its capacity as Dissemination Agent), its officers,
directors, employees and agents, shall be subject to the provisions of this Section 7.4.
The recitals of fact and all promises, covenants and agreements contained herein and in the Bonds
and any offering documents pertaining to the Bonds shall be taken as statements, promises, covenants and
agreements of the CFD, and the Fiscal Agent assumes no responsibility for the correctness of the same
and makes no representations as to the validity or sufficiency of this Fiscal Agent Agreement or the
Bonds, and shall incur no responsibility in respect thereof, other than in connection with its duties or
obligations specifically set forth herein, in the Bonds, or in the certificate of authentication assigned to or
imposed upon the Fiscal Agent. The Fiscal Agent shall be under no responsibility or duty with respect to
the issuance of the Bonds for value.
The Fiscal Agent shall be protected in acting upon any notice, resolution, request, consent, order,
certificate, report, Bond or other paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties. The Fiscal Agent may consult with counsel, who may be
counsel to the CFD, with regard to legal questions, and the opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken or suffered hereunder in good faith
and in accordance therewith.
The Fiscal Agent shall not be bound to recognize any person as the Owner of a Bond unless and
until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if
disputed. The Fiscal Agent may become the owner or pledgee of Bonds, and may otherwise deal with the
CFD with the same rights it would have if it were not the Fiscal Agent.
Whenever in the administration of its duties under this Fiscal Agent Agreement the Fiscal Agent
shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any
42831645.7 41
action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of bad faith on the part of the Fiscal Agent, be deemed to be conclusively proved and
established by a written certificate of the CFD, and such certificate shall be full warrant to the Fiscal
Agent for any action taken or suffered under the provisions of this Fiscal Agent Agreement upon the faith
thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or
may require such additional evidence as to it may seem reasonable.
The Fiscal Agent shall have no duty or obligation whatsoever to enforce the collection of Special
Taxes or other funds to be deposited with it hereunder, or as to the correctness of any amounts received,
but its liability shall be limited to the proper accounting for such funds as it shall actually receive. No
provision in this Fiscal Agent Agreement shall require the Fiscal Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise
of its rights or powers.
The Fiscal Agent makes no representations with respect to any information, statement, or recital
in, and shall have no liability with respect to, any official statement, offering memorandum or any other
disclosure material prepared or distributed with respect to the Bonds.
All rights and indemnities of the Fiscal Agent pursuant to this Section 7.4 shall survive the
removal or resignation of the Fiscal Agent, the discharge of the Bonds, or the amendment or assignment
of this Fiscal Agent Agreement.
Section 7.5. Merger or Consolidation. Any company into which the Fiscal Agent may be
merged or converted or with which it may be consolidated or any company resulting from any merger,
conversion or consolidation to which it shall be a party or any company to which the Fiscal Agent may
sell or transfer all or substantially all of its corporate trust business, shall be the successor to the Fiscal
Agent without the execution or filing of any paper or further act, anything herein to the contrary
notwithstanding.
ARTICLE VIII
EVENTS OF DEFAULT; REMEDIES
Section 8.1. Events of Default. Any one or more of the following events shall constitute an
"event of default" with respect to any Series of Bonds:
(a) Default in the due and punctual payment of the principal of or redemption
premium, if any, on any Bond when and as the same shall become due and payable, whether at
maturity as therein expressed, by declaration or otherwise;
(b) Default in the due and punctual payment of the interest on any Bond when and as
the same shall become due and payable; or
(c) Except as described in (a) or (b), default shall be made by the CFD in the
observance of any of the agreements, conditions or covenants on its part contained in this Fiscal
Agent Agreement or the Bonds, and such default shall have continued for a period of 30 days
after the CFD shall have been given notice in writing of such default by the Fiscal Agent or the
Owners of 25% in aggregate principal amount of the Outstanding Bonds.
The CFD agrees to give notice to the Fiscal Agent immediately upon the occurrence of an event
of default under (a) or (b) above and within 30 days of the CFD's knowledge of an event of default under
42831645.7 42
(c) above. The Fiscal Agent shall not be deemed to have knowledge of any event of default described in
Section 8.1(c) unless a responsible officer shall have actual knowledge thereof or the Fiscal Agent shall
have received written notice at its Corporate Trust Office.
Section 8.2. Remedies of Owners. Following the occurrence of an event of default, any
Owner shall have the right for the equal benefit and protection of all Owners similarly situated:
(1) By mandamus or other suit or proceeding at law or in equity to enforce his rights against
the CFD and any of the members, officers and employees of the CFD, and to compel the CFD or any such
members, officers or employees to perform and carry out their duties under the Act and their agreements
with the Owners as provided in this Fiscal Agent Agreement;
(2) By suit in equity to enjoin any actions or things which are unlawful or violate the rights
of the Owners; or
(3) By a suit in equity to require the CFD and its members, officers and employees to
account as the fiscal agent of an express trust.
Nothing in this Article or in any other provision of this Fiscal Agent Agreement or the Bonds
shall affect or impair the obligation of the CFD, which is absolute and unconditional, to pay the interest
on and principal of the Bonds to the respective Owners thereof at the respective dates of maturity, as
herein provided, out of the Special Taxes and other amounts pledged for such payment, or affect or impair
the right of action, which is also absolute and unconditional, of such Owners to institute suit to enforce
such payment by virtue of the contract embodied in the Bonds and in this Fiscal Agent Agreement.
A waiver of any default or breach of duty or contract by any Owner shall not affect any
subsequent default or breach of duty or contract, or impair any rights or remedies on any such subsequent
default or breach. No delay or omission by any Owner to exercise any right or power accruing upon any
default shall impair any such right or power or shall be construed to be a waiver of any such default or an
acquiescence therein, and every power and remedy conferred upon the Owners by the Act or by this
article may be enforced and exercised from time to time and as often as shall be deemed expedient by the
Owners.
If any suit, action or proceeding to enforce any right or exercise any remedy is abandoned or
determined adversely to the Owners, the CFD and the Owners shall be restored to their former positions,
rights and remedies as if such suit, action or proceeding had not been brought or taken.
No remedy herein conferred upon or reserved to the Owners is intended to be exclusive of any
other remedy. Every such remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing, at law or in equity or by statute or otherwise, and may be
exercised without exhausting and without regard to any other remedy conferred by the Act or any other
law.
In case the moneys held by the Fiscal Agent after an event of default pursuant to Section 8.1(a) or
(b) shall be insufficient to pay in full the whole amount so owing and unpaid upon the Outstanding
Bonds, then all available amounts shall be applied to the payment of such principal and interest without
preference or priority of principal over interest, or interest over principal, or of any installment of interest
over any other installment of interest, ratably to the aggregate of such principal and interest.
42831645.7 43
ARTICLE IX
DEFEASANCE
Section 9.1. Defeasance. If the CFD shall pay or cause to be paid, or there shall otherwise be
paid, to the Owner of an Outstanding Bond the interest due thereon and the principal thereof, at the times
and in the manner stipulated in this Fiscal Agent Agreement or any Supplemental Fiscal Agent
Agreement, then the Owner of such Bond shall cease to be entitled to the pledge of Special Taxes, and,
other than as set forth below, all covenants, agreements and other obligations of the CFD to the Owner of
such Bond under this Fiscal Agent Agreement shall thereupon cease, terminate and become void and be
discharged and satisfied. In the event of a defeasance of all Outstanding Bonds pursuant to this Section,
the Fiscal Agent shall execute and deliver to the CFD all such instruments as may be desirable to
evidence such discharge and satisfaction, and the Fiscal Agent shall pay over or deliver to the CFD's
general fund all money or securities held by it pursuant to this Fiscal Agent Agreement which are not
required for the payment of the principal of, premium, if any, and interest due on such Bonds.
Any Outstanding Bond shall be deemed to have been paid within the meaning expressed in the
first paragraph of this Section if such Bond is paid in any one or more of the following ways:
(a) by paying or causing to be paid the principal of, premium, if any, and interest on
such Bond, as and when the same become due and payable;
(b) by depositing with the Fiscal Agent at or before maturity, money which, together
with the amounts then on deposit in the Special Tax Fund (exclusive of amounts transferred to the
Administrative Expense Fund) and available for such purpose, is fully sufficient to pay the
principal of, premium, if any, and interest on such Bond, as and when the same shall become due
and payable; or
(c) by depositing with the Fiscal Agent or another escrow bank appointed by the
CFD noncallable Defeasance Securities, in which the CFD may lawfully invest its money, in such
amount as will be sufficient, together with the interest to accrue thereon and moneys then on
deposit in the Special Tax Fund (exclusive of amounts transferred to the Administrative Expense
Fund) and available for such purpose, together with the interest to accrue thereon, to pay and
discharge the principal of, premium, if any, and interest on such Bond, as and when the same
shall become due and payable;
then, at the election of the CFD, and notwithstanding that any Outstanding Bonds shall not have
been surrendered for payment, all obligations of the CFD under this Fiscal Agent Agreement and any
Supplemental Fiscal Agent Agreement with respect to such Bond shall cease and terminate, except for the
obligation of the Fiscal Agent to pay or cause to be paid to the Owners of any such Bond not so
surrendered and paid, all sums due thereon and except for the covenants of the CFD contained in Section
5.2(6) or any covenants in a Supplemental Fiscal Agent Agreement relating to compliance with the Code.
Notice of such election shall be filed with the Fiscal Agent not less than ten days prior to the proposed
defeasance date, or such shorter period of time as may be acceptable to the Fiscal Agent. In connection
with a defeasance under (c) above, there shall be provided to the CFD a verification report from an
independent nationally recognized certified public accountant stating its opinion as to the sufficiency of
the moneys or securities deposited with the Fiscal Agent or the escrow bank to pay and discharge the
principal of, premium, if any, and interest on all Outstanding Bonds to be defeased in accordance with
this Section, as and when the same shall become due and payable, and with respect to defeasance under
(b) or (c) above an opinion of Bond Counsel (which may rely upon the opinion of the certified public
accountant) to the effect that the Bonds being defeased have been legally defeased in accordance with this
42831645.7 44
Fiscal Agent Agreement and any applicable Supplemental Fiscal Agent Agreement. If a forward supply
contract is employed in connection with an advance refunding to be effected under (c) above, (1) such
verification report shall expressly state that the adequacy of the amounts deposited with the bank under
(c) above to accomplish the refunding relies solely on the initial escrowed investments and the maturity
principal thereof and interest income thereon and does not assume performance under or compliance with
the forward supply contract, and (11) the applicable escrow agreement executed to effect an advance
refunding in accordance with (c) above shall provide that, in the event of any discrepancy or difference
between the terms of the forward supply contract and the escrow agreement, the terms of the escrow
agreement shall be controlling.
Upon a defeasance, the Fiscal Agent, upon request of the CFD, shall release the rights of the
Owners of such Bonds which have been defeased under this Fiscal Agent Agreement and any
Supplemental Fiscal Agent Agreement and execute and deliver to the CFD all such instruments as may be
desirable to evidence such release, discharge and satisfaction. In the case of a defeasance hereunder of all
Outstanding Bonds, the Fiscal Agent shall pay over or deliver to the CFD any funds held by the Fiscal
Agent at the time of a defeasance, which are not required for the purpose of paying and discharging the
principal of, premium, if any, or interest on the Bonds when due or to the payment of fees and expenses
of the Fiscal Agent. The Fiscal Agent shall, at the written direction of the CFD, mail, first class, postage
prepaid, a notice to the Bondowners whose Bonds have been defeased, in the form directed by the CFD,
stating that the defeasance has occurred.
ARTICLE X
MISCELLANEOUS
Section 10.1. Cancellation of Bonds. All Bonds surrendered to the Fiscal Agent for payment
upon maturity or for redemption shall be upon payment therefor, and any Bond purchased by the CFD as
authorized herein and delivered to the Fiscal Agent for such purpose shall be, cancelled forthwith and
shall not be reissued. The Fiscal Agent shall destroy such Bonds, as provided by law, and furnish to the
CFD a certificate of such destruction.
Section 10.2. Execution of Documents and Proof of Ownership. Any request, direction,
consent, revocation of consent, or other instrument in writing required or permitted by this Fiscal Agent
Agreement to be signed or executed by Bondowners may be in any number of concurrent instruments of
similar tenor may be signed or executed by such Owners in person or by their attorneys appointed by an
instrument in writing for that purpose, or by the bank, trust company or other depository for such Bonds.
Proof of the execution of any such instrument, or of any instrument appointing any such attorney, and of
the ownership of Bonds shall be sufficient for the purposes of this Fiscal Agent Agreement (except as
otherwise herein provided), if made in the following manner:
(1) The fact and date of the execution by any Owner or his or her attorney of any such
instrument and of any instrument appointing any such attorney, may be proved by a signature guarantee
of any bank or trust company or other eligible guarantor located within the United States of America.
Where any such instrument is executed by an officer of a corporation or association or a member of a
partnership on behalf of such corporation, association or partnership, such signature guarantee shall also
constitute sufficient proof of his Authority.
(2) As to any Bond, the person in whose name the same shall be registered in the Bond
Register shall be deemed and regarded as the absolute owner thereof for all purposes, and payment of or
on account of the principal of any such Bond, and the interest thereon, shall be made only to or upon the
order of the registered Owner thereof or his or her legal representative. All such payments shall be valid
42831645.7 45
and effectual to satisfy and discharge the liability upon such Bond and the interest thereon to the extent of
the sum or sums to be paid. Neither the CFD nor the Fiscal Agent shall be affected by any notice to the
contrary.
Nothing contained in this Fiscal Agent Agreement shall be construed as limiting the Fiscal Agent
or the CFD to such proof, it being intended that the Fiscal Agent or the CFD may accept any other
evidence of the matters herein stated which the Fiscal Agent or the CFD may deem sufficient. Any
request or consent of the Owner of any Bond shall bind every future Owner of the same Bond in respect
of anything done or suffered to be done by the Fiscal Agent or the CFD in pursuance of such request or
consent.
Section 10.3. Unclaimed Moneys. To the extent permitted by law, anything in this Fiscal
Agent Agreement to the contrary notwithstanding, any money held by the Fiscal Agent for the payment
and discharge of any of the Outstanding Bonds which remain unclaimed for a period ending at the earlier
of two Business Days prior to the date such funds would escheat to the State or two years after the date
when such Outstanding Bonds have become due and payable, if such money was held by the Fiscal Agent
at such date, or for a period ending at the earlier of two Business Days prior to the date such funds would
escheat to the State or two years after the date of deposit of such money if deposited with the Fiscal Agent
after the date when such Outstanding Bonds become due and payable, shall be repaid by the Fiscal Agent
to the CFD, as its absolute property, and the Fiscal Agent shall thereupon be released and discharged with
respect thereto and the Owners shall look only to the CFD for the payment of such Outstanding Bonds;
provided, however, that, before being required to make any such payment to the CFD, the Fiscal Agent at
the written request of the CFD or the Fiscal Agent shall, at the expense of the CFD, cause to be mailed by
first-class mail, postage prepaid, to the registered Owners of such Outstanding Bonds at their addresses as
they appear on the registration books of the Fiscal Agent a notice that said money remains unclaimed and
that, after a date named in said notice, which date shall not be less than 30 days after the date of the
mailing of such notice, the balance of such money then unclaimed will be returned to the CFD. The
Fiscal Agent shall not be liable to the CFD or any Owner for interest on uninvested funds held by it for
the payment and discharge of the principal, premium or interest on any of the Bonds to any Owner.
Section 10.4. Provisions Constitute Contract. The provisions of this Fiscal Agent
Agreement shall constitute a contract between the CFD and the Bondowners and the provisions hereof
shall be construed in accordance with the laws of the State of California.
In case any suit, action or proceeding to enforce any right or exercise any remedy shall be brought
or taken and, should said suit, action or proceeding be abandoned, or be determined adversely to the
Bondowners or the Fiscal Agent, then the CFD, the Fiscal Agent and the Bondowners shall be restored to
their former positions, rights and remedies as if such suit, action or proceeding had not been brought or
taken.
After the issuance and delivery of the Bonds this Fiscal Agent Agreement shall be irrepealable,
but shall be subject to modifications to the extent and in the manner provided in this Fiscal Agent
Agreement, but to no greater extent and in no other manner.
Section 10.5. Future Contracts. Nothing herein contained shall be deemed to restrict or
prohibit the CFD from making contracts or creating bonded or other indebtedness payable from a pledge
of the Special Taxes which is subordinate to the pledge hereunder, or which is payable from the general
fund of the CFD or from taxes or any source other than the Special Taxes and other amounts pledged
hereunder.
42831645.7 46
Section 10.6. Further Assurances. The CFD will adopt, make, execute and deliver any and
all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry
out the intention or to facilitate the performance of this Fiscal Agent Agreement, and for the better
assuring and confirming unto the Owners of the Bonds the rights and benefits provided in this Fiscal
Agent Agreement.
Section 10.7. Severability. If any covenant, agreement or provision, or any portion thereof,
contained in this Fiscal Agent Agreement, or the application thereof to any person or circumstance, is
held to be unconstitutional, invalid or unenforceable, the remainder of this Fiscal Agent Agreement and
the application of any such covenant, agreement or provision, or portion thereof, to other persons or
circumstances, shall be deemed severable and shall not be affected thereby, and this Fiscal Agent
Agreement, the Bonds issued pursuant hereto shall remain valid and the Bondowners shall retain all valid
rights and benefits accorded to them under the laws of the State of California
Section 10.8. Notices. Any notice, request, complaint, demand or other communication under
this Fiscal Agent Agreement shall be given by first-class mail or personal delivery to the party entitled
thereto at its address set forth below, or by facsimile or other form of electronic communication, at its
number or email address set forth below. Notice shall be effective either (a) upon transmission by
telecopy or other form of telecommunication, (b) 48 hours after deposit in the United States mail, postage
prepaid, or (c) in the case of personal delivery to any person, upon actual receipt. The CFD or the Fiscal
Agent may, by written notice to the other parties, from time to time modify the address or number to
which communications are to be given hereunder.
If to the CFD: City of Santa Clarita Community Facilities District
No. 2016-1 (Vista Canyon)
c/o City of Santa Clarita
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: City Treasurer
If to the Fiscal Agent: U.S. Bank National Association
633 West Fifth Street, 24th Floor
Los Angeles, California 90071
Attention: Global Corporate Trust
Section 10.9. General Authorization. The Mayor, City Administrator and the Finance
Director are hereby respectively authorized to do and perform from time to time any and all acts and
things consistent with this Fiscal Agent Agreement necessary or appropriate to carry the same into effect.
Section 10.10. Execution in Counterparts. This Fiscal Agent Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes be deemed to be an
original; and all such counterparts shall together constitute but one and the same instrument.
42831645.7 47
IN WITNESS WHEREOF, the CITY COUNCIL OF THE CITY OF SANTA CLARITA, acting
as the legislative body of CITY OF SANTA CLARITA COMMUNITY FACILITIES DISTRICT NO.
2016-1 (VISTA CANYON), has caused this Fiscal Agent Agreement to be signed by its Mayor and
attested to by its City Clerk, and U.S. BANK NATIONAL ASSOCIATION, has caused this Fiscal Agent
Agreement to be signed in its corporate name by its officer identified below, all as of the day and year
first above written.
ATTEST:
City Clerk of the City of Santa Clarita, on behalf of
the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon)
CITY OF SANTA CLARITA COMMUNITY
FACILITIES DISTRICT NO. 2016-1 (VISTA
CANYON)
ma
Mayor of the City of Santa Clarita, on behalf of
the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon)
U.S. BANK NATIONAL ASSOCIATION, as
Fiscal Agent
By:
Its:
Authorized Officer
42831645.7 S-1
No.
EXHIBIT A
FORM OF 2020 BOND
UNITED STATES OF AMERICA
STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON)
SPECIAL TAX BOND, 2020 Series
INTEREST RATE MATURITY DATE DATED DATE CUSIP NO.
% September 1, 20 February , 2020
REGISTERED OWNER: CEDE & CO.
PRINCIPAL AMOUNT:
AND NO/100 DOLLARS
CITY OF SANTA CLARITA COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA
CANYON) (the "CFD") situated in the County of Los Angeles, State of California, FOR VALUE
RECEIVED, hereby promises to pay, solely from certain amounts held under the Fiscal Agent Agreement
(as hereinafter defined), to the Registered Owner named above, or registered assigns, on the Maturity
Date set forth above, unless redeemed prior thereto as hereinafter provided, the Principal Amount set
forth above, and to pay interest on such Principal Amount from the Interest Payment Date (as hereinafter
defined) next preceding the date of authentication hereof, unless (1) the date of authentication is an
Interest Payment Date in which event interest shall be payable from such date of authentication, (11) the
date of authentication is after a Record Date (as hereinafter defined) but prior to the immediately
succeeding Interest Payment Date, in which event interest shall be payable from the Interest Payment
Date immediately succeeding the date of authentication, or (111) the date of authentication is prior to the
close of business on the first Record Date in which event interest shall be payable from the Dated Date set
forth above. Notwithstanding the foregoing, if at the time of authentication of this 2020 Bond interest is
in default, interest on this 2020 Bond shall be payable from the last Interest Payment Date to which the
interest has been paid or made available for payment or, if no interest has been paid or made available for
payment, interest on this 2020 Bond shall be payable from the Dated Date set forth above. Interest will
be paid semiannually on March 1 and September 1 of each year (each, an "Interest Payment Date"),
commencing September 1, 2020, at the Interest Rate set forth above, until the Principal Amount hereof is
paid or made available for payment.
The principal of and premium, if any, on this 2020 Bond are payable to the Registered Owner
hereof in lawful money of the United States of America upon presentation and surrender of this 2020
Bond at the Corporate Trust Office of U.S. Bank National Association, a national banking association (the
"Fiscal Agent"). Interest on this 2020 Bond shall be paid by check of the Fiscal Agent mailed by first
class mail, postage prepaid, or in certain circumstances described in the Fiscal Agent Agreement by wire
42831645.7 A- I
transfer to an account within the United States, to the Registered Owner hereof as of the close of business
on the fifteenth day of the month preceding the month in which the Interest Payment Date occurs (the
"Record Date") at such Registered Owner's address as it appears on the registration books maintained by
the Fiscal Agent. Interest due on the 2020 Bonds shall be calculated on a basis of a 360-day year
comprised of twelve 30-day months.
This 2020 Bond is one of a duly authorized issue of "City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon) Special Tax Bonds" (the "Bonds") pursuant to the Mello -Roos
Community Facilities Act of 1982, as amended, being Sections 53311, et seq., of the California
Government Code (the "Act") and a Fiscal Agent Agreement dated as of February 1, 2020 (the "Fiscal
Agent Agreement"), between the CFD and the Fiscal Agent. Such authorized issue of Bonds is not
limited in aggregate principal amount, except as otherwise provided in the Fiscal Agent Agreement, and
consists or may consist of one or more Series of varying denominations, dates, maturities, interest rates
and other provisions, as in the Fiscal Agent Agreement provided, all issued or to be issued pursuant to the
Fiscal Agent Agreement. This Bond of the Series and designation indicated above (each, a "2020 Bond"),
of Bond is issued in the aggregate principal amount of $[principal amount] pursuant to the Act and the
Fiscal Agent Agreement for the purpose of financing the acquisition of certain capital facilities in the
CFD, funding a reserve account, and paying certain costs related to the issuance of the 2020 Bonds. The
issuance of the 2020 Bonds and the terms and conditions thereof are provided for by a resolution adopted
by the City Council of the City of Santa Clarita, acting in its capacity as the legislative body of the CFD
(the "Council") on January 28, 2020 and the Fiscal Agent Agreement, and this reference incorporates the
Fiscal Agent Agreement herein, and by acceptance hereof the Registered Owner of this 2020 Bond
assents to said terms and conditions. The Fiscal Agent Agreement is executed under and this 2020 Bond
is issued under, and both are to be construed in accordance with, the laws of the State of California.
Any amounts for the payment hereof shall be limited to the Special Taxes pledged and collected
or foreclosure proceeds received following a default in payment of the Special Taxes and other amounts
deposited to the Special Tax Fund (exclusive of amounts transferred to the Administrative Expense Fund)
established under the Fiscal Agent Agreement. The CFD has covenanted for the benefit of the owners of
the Bonds that under certain circumstances described in the Fiscal Agent Agreement it will commence
and diligently pursue to completion appropriate foreclosure proceedings in the event of delinquencies of
Special Tax installments levied for payment of principal and interest on the Bonds.
The 2020 Bonds are subject to redemption prior to maturity at the option of the CFD on any
Interest Payment Date on or after September 1, 2027, as a whole or in part, by lot, from any available
source of funds at the following redemption prices (expressed as a percentage of the principal amount of
2020 Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption:.
Redemption Dates Redemption Prices
September 1, 2027 and March 1, 2028 102%
September 1, 2028 and March 1, 2029 101
September 1, 2029 and every March 1 and September 1 thereafter 100
The 2020 Bonds are subject to mandatory redemption prior to maturity on any Interest Payment
Date on or after September 1, 2020, as a whole or in part, in a manner determined by the CFD from
prepayments of Special Taxes at the following redemption prices (expressed as a percentage of the
principal amount of 2020 Bonds to be redeemed), together with accrued interest thereon to the date fixed
for redemption:
42831645.7 A-2
Redemption Dates Redemption Prices
September 1, 2020 and every March 1 and September 1
through and including March 1, 2027 103%
September 1, 2027 and March 1, 2028 102
September 1, 2028 and March 1, 2029 101
September 1, 2029 and every March 1 and September 1 100
thereafter
In connection with such redemption, the CFD may also apply amounts in the Reserve Account
which will be in excess of the Reserve Requirement as a result of such Special Tax prepayment to redeem
2020 Bonds as set forth above.
The Term 2020 Bonds maturing on September 1, 20 , and on September 1, 20 are subject to
mandatory redemption, in part by lot, on September 1 in each year commencing September 1, 20 with
respect to the Term 2020 Bonds maturing on September 1, 20__-, and commencing September 1, 20
with respect to the Term 2020 Bonds maturing on September 1, 20 , from the Sinking Fund Payments
that have been deposited into the Redemption Account at a redemption price equal to the principal
amount thereof to be redeemed, without premium, plus accrued interest thereon to the date of redemption
as set forth in the following schedule; provided, however, that (i) in lieu of redemption thereof, the Term
2020 Bonds may be purchased by the CFD and tendered to the Fiscal Agent, and (11) if some but not all of
the Term 2020 Bonds have been optionally redeemed or redeemed due to Special Tax prepayments, the
total amount of all future sinking payments will be reduced by the aggregate principal amount of the
Term 2020 Bonds so redeemed, to be allocated among such sinking payments on a pro rata basis (as
nearly as practicable) in integral multiples of $5,000 as determined by the CFD.
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1) Principal Amount
(maturity)
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1) Principal Amount
(maturity)
Notice of redemption with respect to the Bonds to be redeemed shall be mailed to the registered
owners thereof not less than 20 nor more than 60 days prior to the redemption date by first class mail,
postage prepaid, to the addresses set forth in the registration books. Neither a failure of the Registered
Owner hereof to receive such notice nor any defect therein will affect the validity of the proceedings for
redemption. All Bonds or portions thereof so called for redemption will cease to accrue interest on the
specified redemption date; provided that funds for the redemption are on deposit with the Fiscal Agent on
42831645.7 A-3
the redemption date. Thereafter, the registered owners of such Bonds shall have no rights except to
receive payment of the redemption price upon the surrender of the Bonds.
If at the time of mailing of any notice of optional redemption there shall not have been deposited
with the Fiscal Agent moneys sufficient to redeem all the Bonds called for redemption, such notice shall
state that it is subject to the deposit of the redemption moneys with the Fiscal Agent not later than the
opening of business on the redemption date and will be of no effect unless such moneys are so deposited.
The CFD shall have the right to rescind any notice of optional redemption by written notice to the
Fiscal Agent on or prior to the date fixed for redemption. Any notice of such redemption shall be
cancelled and annulled if for any reason funds will not be or are not available on the date fixed for
redemption for the payment in full of the Bonds then called for redemption, and such cancellation shall
not constitute an Event of Default hereunder. The CFD and the Fiscal Agent shall have no liability to the
Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent
shall mail notice of such rescission of redemption in the same manner as the original notice of redemption
was sent.
This 2020 Bond shall be registered in the name of the Registered Owner hereof, as to both
principal and interest, and the CFD and the Fiscal Agent may treat the Registered Owner hereof as the
absolute owner for all purposes and shall not be affected by any notice to the contrary.
The 2020 Bonds are issuable only in fully registered form, initially in the denomination of
$100,000 or any integral multiple of $5,000 in excess thereof, and may be exchanged for a like aggregate
principal amount of Bonds of other Authorized Denominations of the same issue and maturity, all as more
fully set forth in the Fiscal Agent Agreement. Upon the occurrence of a Trigger Event ("Trigger Event
Date"), this 2020 Bonds shall automatically be converted to authorized denominations of $5,000 or any
integral multiple thereof This 2020 Bond is transferable by the Registered Owner hereof, in person or by
his attorney duly authorized in writing, at the Corporate Trust Office of the Fiscal Agent in Los Angeles,
California, but only in the manner, subject to the limitations and upon payment of the charges provided in
the Fiscal Agent Agreement, upon surrender and cancellation of this 2020 Bond. Upon such transfer, a
new registered 2020 Bond of Authorized Denominations for the same aggregate principal amount of the
same Series, issue and maturity will be issued to the transferee in exchange therefor.
A Trigger Event is defined under the Fiscal Agent Agreement as (a) the issuance by the CFD of
an additional series of Bonds on parity with the 2020 Bonds, or (b) the filing of an Annual Report
pursuant to the Issuer Continuing Disclosure Certificate which contains information that the Assigned
Special Tax that could be levied on Developed Property is at least equal to 100% of the Annual Debt
Service on the 2020 Bonds.
PRIOR TO THE TRIGGER EVENT DATE, NEITHER THIS 2020 BOND NOR ANY
BENEFICIAL OWNERSHIP INTEREST HEREIN MAY BE TRANSFERRED BY THE BENEFICIAL
OWNER HEREOF EXCEPT TO ANY PERSON THAT IS EITHER (A) A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT OF
1933, AS AMENDED); OR (B) AN "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501 OF
REGULATION D UNDER THE SECURITIES ACT OF 1933, AS AMENDED) WHO IS
PURCHASING FOR ITS OWN ACCOUNT FOR INVESTMENT PURPOSES AND NOT WITH A
VIEW TO DISTRIBUTING THIS 2020 BOND. ANY OWNER OR BENEFICIAL OWNER OF THIS
2020 BOND PRIOR TO THE TRIGGER EVENT DATE SHALL BE DEEMED BY THE
ACCEPTANCE OR ACQUISITION OF SUCH BENEFICIAL OWNERSHIP INTEREST TO HAVE
AGREED TO BE BOUND BY THE TRANSFER RESTRICTIONS PROVISIONS IN THE FISCAL
AGENT AGREEMENT. THE TRANSFEROR OF THIS 2020 BOND TRANSFERRED PRIOR TO
42831645.7 A-4
THE TRIGGER EVENT DATE SHALL BE DEEMED TO HAVE AGREED TO PROVIDE NOTICE
TO ANY PROPOSED ASSIGNEE OF A BENEFICIAL OWNERSHIP INTEREST IN THE
PURCHASED 2020 BOND OF THE RESTRICTIONS ON TRANSFER DESCRIBED HEREIN.
The Fiscal Agent shall not be required to register transfers or make exchanges of (1) any 2020
Bonds for a period of 15 days next preceding any selection of the 2020 Bonds to be redeemed, or (11) any
2020 Bonds chosen for redemption.
The rights and obligations of the CFD and of the registered owners of the 2020 Bonds may be
amended at any time, and in certain cases without notice to or the consent of the registered owners, to the
extent and upon the terms provided in the Fiscal Agent Agreement.
The Fiscal Agent Agreement contains provisions permitting the CFD to make provision for the
payment of the interest on, and the principal and premium, if any, of the 2020 Bonds so that such 2020
Bonds shall no longer be deemed to be outstanding under the terms of the Fiscal Agent Agreement.
THE BONDS DO NOT CONSTITUTE OBLIGATIONS OF THE CITY OF SANTA CLARITA
(THE "CITY") OR OF THE CFD FOR WHICH THE CITY OR THE CFD IS OBLIGATED TO LEVY
OR PLEDGE, OR HAS LEVIED OR PLEDGED, GENERAL OR SPECIAL TAXES, OTHER THAN
THE SPECIAL TAXES REFERENCED HEREIN. THE BONDS ARE LIMITED OBLIGATIONS OF
THE CFD PAYABLE FROM THE PORTION OF THE SPECIAL TAXES AND OTHER AMOUNTS
PLEDGED UNDER THE FISCAL AGENT AGREEMENT BUT ARE NOT A DEBT OF THE CITY,
THE STATE OF CALIFORNIA OR ANY OF ITS POLITICAL SUBDIVISIONS WITHIN THE
MEANING OF ANY CONSTITUTIONAL OR STATUTORY LIMITATION OR RESTRICTION.
This 2020 Bond shall not become valid or obligatory for any purpose until the certificate of
authentication and registration hereon endorsed shall have been dated and signed by the Fiscal Agent.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things
required by law to exist, happen and be performed precedent to and in the issuance of this 2020 Bond do
exist, have happened and have been performed in due time, form and manner as required by law, and that
the amount of this 2020 Bond, together with all other indebtedness of the CFD, does not exceed any debt
limit prescribed by the laws or Constitution of the State of California.
42831645.7 A-5
IN WITNESS WHEREOF, City of Santa Clarita Community Facilities District No. 2016-1 (Vista
Canyon) has caused this 2020 Bond to be dated as of the Dated Date, to be signed on behalf of the CFD
by the Mayor of the City of Santa Clarita, acting as the legislative body of the City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon) by her manual signature and attested by the
manual signature of the City Clerk of the City of Santa Clarita and has caused the seal of the City to be
reproduced hereon.
[SEAL]
Mayor of the City of Santa Clarita , acting on
behalf of the City of Santa Clarita Community
Facilities District No. 2016-1 (Vista Canyon)
ATTEST:
City Clerk of the City of Santa Clarita, acting on
behalf of the City of Santa Clarita Community
Facilities District No. 2016-1 (Vista Canyon)
42831645.7 A-6
Dated:
[FORM OF FISCAL AGENT'S CERTIFICATE
OF AUTHENTICATION AND REGISTRATION]
This is one of the 2020 Bonds described in the within -defined Fiscal Agent Agreement.
U.S. BANK NATIONAL ASSOCIATION, as
Fiscal Agent
By:
Its:
Authorized Signatory
42831645.7 A-7
[FORM OF ASSIGNMENT]
For value received the undersigned hereby sells, assigns and transfers unto
(NAME, ADDRESS, AND TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER OF ASSIGNEE)
the within -mentioned Bond and hereby irrevocably constitute(s) and appoint(s)
attorney, to transfer the
books of the Fiscal Agent with full power of substitution in the premises.
Dated:
Signature Guaranteed:
Note: Signature(s) must be guaranteed by an eligible
guarantor institution.
same on the registration
Note: The signature(s) on this Assignment must
correspond with the names as written on the face of the
within Bond in every particular without alteration or
enlargement or any change whatsoever.
42831645.7 A-8
EXHIBIT B
REQUISITION NO. _
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON)
REQUISITION FOR DISBURSEMENT OF PROJECT COSTS
U.S. Bank National Association is hereby directed to disburse from the Acquisition and
Construction Fund of the Community Facilities District No. 2016-1 (Vista Canyon), established by the
Fiscal Agent Agreement dated as of February 1, 2020, between the Fiscal Agent and City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon), to the payee, designated on Appendix "A"
attached hereto and by this reference incorporated herein, at the address set forth below such payee name,
the respective sums set forth opposite such payees, in payment for the obligation described on said
Appendix "A."
Each obligation shown on Appendix "A" has been properly verified and approved by the CFD
and is a proper charge against the [2020 Parking Project Costs Account/2020 Transit Center Project Costs
Account] of the Acquisition and Construction Fund.
[For each obligation shown on Appendix "A" payable from the 2020 Parking Project Costs
Account, the CFD acknowledges receipt of joint written instructions with Developer and Western
Alliance Bank. The joint written instructions provide that any and all CFD proceeds for 2020 Parking
Project Costs to purchase the Cooper Street Parking Garage shall be delivered by the Fiscal Agent directly
to Western Alliance Bank for deposit in Account No. in the name of the Developer
maintained with Western Alliance Bank, and that the proceeds shall only be disbursed from Account No.
concurrently with, or following, the delivery of the grant deed for the Cooper Street Parking
Garage to the City, free of encumbrances. Further, the joint instructions shall specify that the CFD
proceeds being disbursed will not be used to release any liens on the Cooper Street Parking Garage
property other than the Western Alliance Bank's lien.]
The amount is due and payable under purchase order, contract or other authorization and has not
formed the basis of any prior request for payment. The conditions to the release of this amount from the
Community Facilities District No. 2016-1 (Vista Canyon) Acquisition and Construction Fund are
satisfied.
There has not been filed with nor served upon the CFD notice of any lien, right to lien or
attachment upon, or stop notice or claim affecting the right to receive payment of the amount specified
above which has not been released or will not be released simultaneously with the payment of such
amount, other than materialmen's or mechanic's liens accruing by mere operation of law.
Payments shall be made by check or wire transfer in accordance with the payment instructions set
forth in Appendix "A" attached or in invoices submitted in accordance therewith and the Fiscal Agent
may rely on such payment instructions though given by the CFD with no duty to investigate or inquire as
to the authenticity of the invoice or the payment instructions contained therein.
42831645.7 B-1
Dated:
CITY OF SANTA CLARITA COMMUNITY
FACILITIES DISTRICT NO. 2016-1 (VISTA
CANYON)
ma
Authorized Representative
42831645.7 B-2
EXHIBIT C
REQUISITION NO.
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1 (VISTA CANYON)
REQUISITION FOR DISBURSEMENT OF COSTS OF ISSUANCE
U.S. Bank National Association is hereby directed to disburse from the Costs of Issuance Fund of
the Community Facilities District No. 2016-1 (Vista Canyon), established by the Fiscal Agent Agreement
dated as of February 1, 2020, between the Fiscal Agent and City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon), to the payee, designated on Appendix "A" attached hereto and by
this reference incorporated herein, at the address set forth below such payee name, the respective sums set
forth opposite such payees, in payment for the obligation described on said Appendix "A."
Each obligation shown on Appendix "A" has been properly verified and approved by the CFD
and is a proper charge against the Costs of Issuance Fund.
The amount is due and payable under purchase order, contract or other authorization and has not
formed the basis of any prior request for payment. The conditions to the release of this amount from the
Community Facilities District No. 2016-1 (Vista Canyon) Costs of Issuance Fund are satisfied.
There has not been filed with nor served upon the CFD notice of any lien, right to lien or
attachment upon, or stop notice or claim affecting the right to receive payment of the amount specified
above which has not been released or will not be released simultaneously with the payment of such
amount, other than materialmen's or mechanic's liens accruing by mere operation of law.
Payments shall be made by check or wire transfer in accordance with the payment instructions set
forth in Appendix "A" attached or in invoices submitted in accordance therewith and the Fiscal Agent
may rely on such payment instructions though given by the CFD with no duty to investigate or inquire as
to the authenticity of the invoice or the payment instructions contained therein.
Dated: CITY OF SANTA CLARITA COMMUNITY
FACILITIES DISTRICT NO. 2016-1 (VISTA
CANYON)
Un
Authorized Representative
42831645.7 C-1
SCHEDULEI
DESCRIPTION OF 2020 Project
2020 Parking Project
Cooper Street Parking Garage with estimated 612 parking spaces
2020 Transit Center Proiect
Vista Canyon Multi -Modal Center (Metrolink Station/Regional Transit Center (bus station))
42831645.7 C-1
1/21/20
NEW ISSUE - BOOK -ENTRY ONLY NO RATING
In the opinion of Norton Rose Fulbright US LLP, Los Angeles, California, Bond Counsel, under existing statutes, regulations, rulings and
court decisions, and assuming compliance with the tax covenants described herein, interest on the 2020 Bonds is excluded from the gross
income of the owners thereof for federal income tax purposes. Bond Counsel is further of the opinion that interest on the 2020 Bonds is not
an item of tax preference for purposes of the federal alternative minimum tax. It is also the opinion of Bond Counsel that, under existing
law, interest on the 2020 Bonds is exemptfrom om personal income taxes of the State of California. See "TAX MATTERS" herein.
STATE OF CALIFORNIA COUNTY OF LOS ANGELES
$18,055,000*
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO.2016-1
(Vista Canyon)
SPECIAL TAX BONDS
2020 SERIES
Dated: Date of Delivery Due: September 1, as shown on the inside front cover
This cover page contains certain information for quick reference only. It is not a summary of the issue. Potential investors must read the
entire Official Statement to obtain information essential to the making of an informed investment decision. Investment in the 2020 Bonds
(as defined herein) involves risks. See "SPECIAL RISK FACTORS" herein for a discussion of special risk factors that should be
considered in evaluating the investment quality of the 2020 Bonds.
The City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series (the "2020 Bonds") are
being issued and delivered to (i) fund the acquisition and construction of certain public facilities including all or a portion of a public
parking structure and a transit center, (ii) fund a reserve fund for the 2020 Bonds and any parity obligations (collectively, the "Bonds"), and
(iii) pay the costs of issuing the 2020 Bonds and forming the district. See "FINANCING PLAN — Sources and Uses of Proceeds" herein.
The 2020 Bonds are authorized pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, and pursuant to a Fiscal Agent
Agreement, dated as of February 1, 2020 (the "Fiscal Agent Agreement'), between the City of Santa Clarity Community Facilities District
No. 2016-1 (Vista Canyon) (the "District'') and U.S. Bank National Association, as Fiscal Agent (the "Fiscal Agenf'). The 2020 Bonds are
limited obligations of the District payable solely from annual Special Taxes (as defined herein) to be levied on taxable land within the
District and from certain other funds pledged under the Fiscal Agent Agreement, all as further described herein. The Special Taxes are to
be levied according to the Rate and Method of Apportionment of Special Tax approved by the City Council of the City of Santa Clarita (the
"City") and the qualified electors within the District. See "THE DISTRICT — Summary of Rate and Method" herein. The City Council of
the City is the legislative body of the District.
Interest on the 2020 Bonds will be payable on September 1, 2020, and semiannually thereafter on each March 1 and September 1.
Individual purchases may initially be made in principal amounts of $100,000 or any integral multiple of $5,000 in excess thereof and will
be in book -entry form only. On the Trigger Event Date (as defined herein), the 2020 Bonds will automatically be converted to authorized
denominations of $5,000 or any integral multiple thereof. The 2020 Bonds are issuable in fully registered form and when issued will be
registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York (` DTC").
Neither the faith and credit nor the taxing power of the District (except as pledged in the Fiscal Agent Agreement), the City, the County of
Los Angeles, the State of California or any political subdivision thereof is pledged to the payment of the 2020 Bonds. Except for the
Special Taxes, no other revenues or taxes are pledged to the payment of the 2020 Bonds. The 2020 Bonds are not general or special
obligations of the City nor general obligations of the District, but are limited obligations of the District payable solely from Special Taxes
and amounts held under the Fiscal Agent Agreement as more fully described herein.
The 2020 Bonds are subject to optional redemption, mandatory redemption from prepayments, and mandatory sinking fund redemption
prior to maturity as set forth herein. See "THE 2020 BONDS — Redemption" herein.
Subject to certain conditions, additional obligations on a parity basis with the 2020 Bonds may be issued in the future by the District. See
"THE 2020 BONDS — Additional Series of Bonds" herein.
INVESTMENT IN THE 2020 BONDS INVOLVES SIGNIFICANT RISKS THAT MAY NOT BE APPROPRIATE FOR
CERTAIN INVESTORS. THEREFORE, ONLY PERSONS WITH SUBSTANTIAL FINANCIAL RESOURCES WHO
UNDERSTAND THE RISKS OF INVESTMENT IN THE 2020 BONDS SHOULD CONSIDER SUCH AN INVESTMENT. SEE
"SPECIAL RISK FACTORS" HEREIN FOR A DISCUSSION OF SPECIAL FACTORS WHICH SHOULD BE CONSIDERED,
IN ADDITION TO THE OTHER MATTERS SET FORTH HEREIN, IN EVALUATING THE INVESTMENT QUALITY OF
THE 2020 BONDS.
THE INITIAL SALES AND TRANSFERS OF THE 2020 BONDS MAY BE MADE ONLY TO "QUALIFIED INSTITUTIONAL
BUYERS" AS DEFINED IN RULE 144A AND TO ACCREDITED INVESTORS AS DEFINED IN RULE 501 OF REGULATION
. Preliminary, subject to change.
1/21/20
D PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SEE "THE 2020 BONDS — TRANSFER
RESTRICTIONS" AND "SPECIAL RISK FACTORS — TRANSFER RESTRICTIONS" HEREIN FOR A STATEMENT OF
CERTAIN RESTRICTIONS ON RESALE AND CERTAIN REPRESENTATIONS AND AGREEMENTS TO BE MADE BY
EACH PURCHASER OF THE 2020 BONDS FROM THE UNDERWRITER.
The 2020 Bonds are offered when, as and if issued, subject to the approval as to their legality by Norton Rose Fulbright US LLP, Bond
Counsel. Certain legal matters will be passed on for the District by Norton Rose Fulbright US LLP, Disclosure Counsel, for the District
and the City by Burke, Williams and Sorensen, LLP, as City Attorney, for the Underwriter by Stradling Yocca Carlson & Rauth A
Professional Corporation, and for the landowners by their respective counsel. It is anticipated that the 2020 Bonds will be available for
delivery in book -entry form on or about February 2020.
STIFE,L
Dated: February , 2020
$18,055,000-
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(Vista Canyon)
SPECIAL TAX BONDS
2020 SERIES
MATURITY SCHEDULE
S Serial 2020 Bonds
Base CUSIPt No.
Maturity Date Principal Interest Reoffering CUSIPt
September 1 Amount Rate Yield Suffix
% Term 2020 Bonds due September 1, 2050, Yield % CUSIPt No.
. Preliminary, subject to change.
t CUSIP® is a registered trademark of the American Bankers Association. CUSIP data herein are provided by CUSIP Global
Services, managed by S&P Capital IQ on behalf of the American Bankers Association. CUSIP numbers have been assigned by
an independent company not affiliated with the City, the Underwriter, the Municipal Advisor or the District and are included
solely for the convenience of the holders of the 2020 Bonds. None of the District, the Underwriter, the Municipal Advisor or the
City is responsible for the selection or use of these CUSIP numbers and no representation is made as to their correctness on the
2020 Bonds or as indicated above. The CUSIP number for a specific maturity is subject to being changed after the execution and
delivery of the 2020 Bonds as a result of various subsequent actions including, but not limited to, a refunding in whole or in part
of such maturity or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by
investors that is applicable to all or a portion of the 2020 Bonds.
CITY COUNCIL
OF THE CITY OF SANTA CLARITA, CALIFORNIA
Legislative Body of the
CITY OF SANTA CLARITA COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
Cameron Smyth, Mayor
William Miranda, Mayor Pro Teen
Robert C. Kellar, Councibnember
Marsha A. McLean, Councilinember
Laurene F. Weste, Councibnember
CITY OFFICIALS
Kenneth W. Striplin, Ed.D., City Manager
Frank Oviedo, Assistant City Manager
Darren Hernandez, Deputy City Manager
Carmen Magaiia, City Treasurer
Mary Cusick, City Clerk
Joseph M. Montes, City Attorney
PROFESSIONAL SERVICES
MUNICIPAL ADVISOR
Columbia Capital Management, LLC
Glendale, California
BOND COUNSEL AND DISCLOSURE COUNSEL
Norton Rose Fulbright US LLP
Los Angeles, California
FISCAL AGENT
U.S. Bank National Association
Los Angeles, California
SPECIAL TAX CONSULTANT & CFD ADMINISTRATOR
Harris & Associates
Irvine, California
TABLE OF CONTENTS
Page
INTRODUCTION........................................................................................................................................
I
RestrictedDistribution.....................................................................................................................
I
TheCity...........................................................................................................................................
I
The Community Facilities District...................................................................................................
I
PropertyOwnership.........................................................................................................................
2
PropertyValues................................................................................................................................3
Authority for Issuance of the 2020 Bonds.......................................................................................
4
Purposeof the 2020 Bonds..............................................................................................................
4
Security and Sources of Payment for the 2020 Bonds.....................................................................
4
Reserve Account for the Bonds.......................................................................................................
5
ForeclosureProceeds.......................................................................................................................
5
AdditionalSeries of Bonds..............................................................................................................
5
Description of the 2020 Bonds........................................................................................................
6
TaxExemption.................................................................................................................................
6
Professionals Involved in the Offering............................................................................................
6
Offering and Delivery of the 2020 Bonds........................................................................................
6
Bondowners' Risks..........................................................................................................................
7
ContinuingDisclosure.....................................................................................................................
7
OtherInformation............................................................................................................................
7
THE2020 BONDS.......................................................................................................................................
7
Authorityfor Issuance......................................................................................................................
7
Purposeof the 2020 Bonds..............................................................................................................
8
Description of the 2020 Bonds........................................................................................................8
Redemption......................................................................................................................................
9
RedemptionProvisions..................................................................................................................
I I
TransferRestrictions......................................................................................................................
I I
AdditionalSeries of Bonds............................................................................................................12
FINANCINGPLAN...................................................................................................................................14
Sources and Uses of Proceeds........................................................................................................16
DebtService Schedule...................................................................................................................17
SECURITY FOR THE 2020 BONDS........................................................................................................18
General..........................................................................................................................................18
TheSpecial Taxes..........................................................................................................................18
SpecialTax Fund...........................................................................................................................19
ReserveAccount............................................................................................................................
20
Administrative Expense Fund........................................................................................................21
Prepaymentof Special Taxes.........................................................................................................21
Covenant for Superior Court Foreclosure......................................................................................
21
Value -to -Lien Ratio.......................................................................................................................
22
No Obligation of the City Upon Delinquency...............................................................................
22
Other Indebtedness and Obligations..............................................................................................
23
VISTA CANYON MASTER PLANNED COMMUNITY........................................................................
25
MasterDeveloper........................................................................................................................... 25
i
TABLE OF CONTENTS (continued
Page
TheDevelopment Entities..............................................................................................................
26
Entitlements and Specific Plan ......................................................................................................
26
Status of Infrastructure in the District............................................................................................
27
FinancingPlan ...............................................................................................................................
29
Environmental................................................................................................................................
31
SchoolMitigation..........................................................................................................................
31
DEVELOPMENT WITHIN THE DISTRICT............................................................................................
31
THEDISTRICT..........................................................................................................................................40
General..........................................................................................................................................
40
Summaryof Rate and Method.......................................................................................................
42
Projected Special Tax Coverage....................................................................................................
44
Appraisal........................................................................................................................................
48
Valuation........................................................................................................................................
50
Estimated Value -to -Lien Ratios.....................................................................................................
51
Direct and Overlapping Debt and Other Obligations.....................................................................
53
SPECIAL RISK FACTORS.......................................................................................................................
54
Risks of Real Estate Secured Investments Generally....................................................................
54
LimitedObligations.......................................................................................................................
54
Failure to Develop Undeveloped Properties..................................................................................
54
LandDevelopment Costs...............................................................................................................55
Insufficiency of Special Taxes.......................................................................................................55
Depletion of Reserve Account.......................................................................................................
56
NaturalDisasters............................................................................................................................57
Risk of Structural and Wildland Fire.............................................................................................
57
Endangered and Threatened Species..............................................................................................
58
HazardousSubstances....................................................................................................................58
Appraised Valuations; Value -to -Lien Ratios.................................................................................58
Concentrationof Ownership..........................................................................................................
59
Competition...................................................................................................................................
59
Parity Taxes and Special Assessments...........................................................................................
59
Disclosures to Future Purchasers...................................................................................................
60
SpecialTax Delinquencies.............................................................................................................
61
Non -Cash Payments of Special Taxes...........................................................................................
61
Payment of the Special Tax is not a Personal Obligation of the Owners ......................................
61
FDIC/Federal Government Interests in Properties.........................................................................
61
Bankruptcyand Foreclosure..........................................................................................................
63
NoAcceleration Provision.............................................................................................................63
Potential Early Redemption From Special Tax Prepayments........................................................
63
Lossof Tax Exemption..................................................................................................................
63
Limitationson Remedies...............................................................................................................
64
TransferRestrictions......................................................................................................................64
No Ratings and Limited Secondary Market...................................................................................
64
Validity of Landowner Elections...................................................................................................
65
BallotInitiatives.............................................................................................................................
66
CONTINUINGDISCLOSURE.................................................................................................................. 67
ii
TABLE OF CONTENTS (continued)
Page
District Continuing Disclosure......................................................................................................
67
Landowner Continuing Disclosure................................................................................................
67
TAXMATTERS.........................................................................................................................................68
TaxExemption...............................................................................................................................
68
Tax Accounting Treatment of Bond Premium and Original Issue Discount on 2020 Bonds ........
69
Other Federal Income Tax Consequences.....................................................................................
70
CONCLUDINGINFORMATION.............................................................................................................
70
Absence of Material Litigation......................................................................................................
70
Approvalof Legality......................................................................................................................
71
No General Obligation of City or District.....................................................................................
71
TheMunicipal Advisor..................................................................................................................71
No Ratings on the 2020 Bonds......................................................................................................
71
Underwriting..................................................................................................................................
71
Miscellaneous................................................................................................................................
72
APPENDIX A — INFORMATION RELATING TO THE CITY OF SANTA CLARITA.................A-1
APPENDIX B FORM OF BOND COUNSEL'S OPINION............................................................B-1
APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT
AGREEMENT.........................................................................................................
C-1
APPENDIX D — RATE AND METHOD OF APPORTIONMENT
OFSPECIAL TAX..................................................................................................D-1
APPENDIX E — BOOK -ENTRY ONLY SYSTEM...........................................................................
E-1
APPENDIX F — FORMS OF CONTINUING DISCLOSURE CERTIFICATES ..............................
F-1
APPENDIX G - APPRAISAL REPORT............................................................................................G-1
III
GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
Use of Official Statement. This Official Statement is submitted in connection with the offer and sale of the 2020
Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. This Official
Statement is not to be construed as a contract with the purchasers of the 2020 Bonds.
Estimates and Forecasts. This Official Statement contains statements which, to the extent they are not recitations of
historical fact, constitute "forward -looking statements," within the meaning of the United States Private Securities
Litigation Reform Act of 1995, Section 21E of the United States Exchange Act of 1934, as amended, and Section
27A of the United States Securities Act of 1933, as amended. In this respect, such forward -looking statements are
generally identified by the use of words "estimate," "project," ..plan," ..budget," ..anticipate," ..expect," ..intend," or
"believe" or the negative thereof or other variations thereon or comparable terminology.
The achievement of certain results or other expectations contained in such forward -looking statements involves
known or unknown risks, uncertainties and other factors which may cause actual results, performance or
achievements to be significantly different than those expressed or implied by such forward -looking statements.
These risks and uncertainties include, but are not limited to, uncertainties relating to economic conditions, the effect
of changes in the amounts and timing of receipt of revenues, the availability and sufficiency of Special Taxes,
change in circumstances adversely affecting the projected use of proceeds, and risks involving pertinent court
decisions. The District does not plan to issue any updates or revisions to those forward -looking statements if or
when its expectations, or events, conditions or circumstances on which such statements are based change. Potential
investors are cautioned that such statements are only predictions and that actual events or results may differ
materially. In evaluating such statements, potential investors should specifically consider the various factors which
could cause actual events or results to differ materially from those indicated by such forward -looking statements.
Limit of Offering. No dealer, broker, salesperson or other person has been authorized by the District or the City to
give any information or to make any representations in connection with the offer or sale of the 2020 Bonds other
than those contained herein and if given or made, such other information or representation must not be relied upon
as having been authorized by the District or the City, the Municipal Advisor or the Underwriter. This Official
Statement does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the
2020 Bonds by a person in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation
or sale.
Involvement of Underwriter. The Underwriter has provided the following statement for inclusion in this Official
Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as a
part of, its responsibilities to investors under the Federal Securities Laws as applied to the facts and circumstances of
this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.
The information and expressions of opinions herein are subject to change without notice and neither delivery of this
Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the District or the City or any other entity described or referenced herein since the
date hereof. All summaries of the documents referred to in this Official Statement are made subject to the provisions
of such documents, respectively, and do not purport to be complete statements of any or all of such provisions.
Stabilization of Prices. In connection with this offering, the Underwriter may overallot or effect transactions which
stabilize or maintain the market price of the 2020 Bonds at a level above that which might otherwise prevail in the
open market. Such stabilizing, if commenced, may be discontinued at any time. The Underwriter may offer and sell
the 2020 Bonds to certain dealers and others at prices lower than the public offering prices set forth on the inside
front cover page hereof and said public offering prices may be changed from time to time by the Underwriter.
THE 2020 BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, IN RELIANCE UPON AN EXCEPTION FROM THE REGISTRATION REQUIREMENTS
CONTAINED IN SUCH ACT. THE 2020 BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES LAWS OF ANY STATE.
NOTICE TO PURCHASERS
The District and the Underwriter intend that the 2020 Bonds are to be offered and sold only to persons
reasonably believed to qualify as Qualified Institutional Buyers or Accredited Investors.
Purchasers Must be Qualified Institutional Buyers or Accredited Investors. As defined by the Fiscal
Agent Agreement, "Qualified Institutional Buyer" means a "qualified institutional buyer" within the meaning of
Rule 144A promulgated under the Securities Act of 1933, as amended, and the rules, regulations and published
interpretations of the Securities and Exchange Commission promulgated thereunder from time to time, and
"Accredited Investor" means an "accredited investor" as defined in Section 501(a) of Regulation D promulgated
under the Securities Act of 1933, as amended, and the rules, regulations and published interpretations of the
Securities and Exchange Commission promulgated thereunder from time to time.
Resale Restrictions and Limits on Transferability. Prior to the Trigger Event Date (defined below), no
transfer, sale or other disposition of any 2020 Bond, or any beneficial interest therein, may be made except to an
entity that the transferor reasonably believes is either (i) a Qualified Institutional Buyer or (ii) an Accredited
Investor who is purchasing for its own account for investment purposes and not with a view to distributing such
2020 Bond. Each transferee of a 2020 Bond, or any beneficial interest therein, by its purchase thereof, will be
deemed to have represented that such transferee is a Qualified Institutional Buyer or an Accredited Investor that is
purchasing such 2020 Bond for its own account for investment purposes and not with a view to distributing such
2020 Bond.
The 2020 Bonds will bear a legend describing or referencing the restrictions on transferability set forth in
the Fiscal Agent Agreement.
Each entity which is or which becomes a Beneficial Owner of a 2020 Bond prior to the Trigger Event
Date will be deemed by the acceptance or acquisition of such beneficial ownership interest to have agreed to be
bound by the transfer restrictions provisions of the Fiscal Agent Agreement. The transferor of a 2020 Bond
transferred prior to the Trigger Event Date will be deemed to have agreed to provide notice to any proposed
assignee of a beneficial ownership interest in the purchased 2020 Bond of the restrictions on transfer described
herein. Any Owner or Beneficial Owner effecting a transfer, sale or other disposition of a 2020 Bond, or
beneficial interest therein, will be deemed to have agreed to indemnify the District, the City and the Fiscal Agent
against any liability that may result if such transfer, sale or other disposition is not made in accordance with the
Fiscal Agent Agreement.
The restrictions on transfer of the 2020 Bonds described above will no longer be applicable to transfers of
the 2020 Bonds or any beneficial interest therein on the date of a Trigger Event (the "Trigger Event Date"). A
Trigger Event is defined under the Fiscal Agent Agreement as (a) the issuance by the District of an additional
series of Bonds on parity with the 2020 Bonds, or (b) the filing of an Annual Report pursuant to the Issuer
Continuing Disclosure Certificate which contains information that the Assigned Special Tax that could be levied
on Developed Property is at least equal to 100% of the Annual Debt Service on the 2020 Bonds. The District is
under no obligation to issue an additional series of the Bonds.
Agreement of Each Purchaser. Prior to the Trigger Event Date, each purchaser of any of the 2020
Bonds (each, a "Purchaser"), by its acceptance thereof or of any interest therein, acknowledges and agrees with
the District, the City and the Underwriter that:
1. The Purchaser (a) is a Qualified Institutional Buyer or an Accredited Investor, and (b) is acquiring
such 2020 Bonds for its own account or for the account of a Qualified Institutional Buyer or an Accredited
Investor;
2. The Purchaser has sufficient knowledge and experience in financial and business matters with
respect to the evaluation of the risk and merits of the investment represented by the 2020 Bonds. The Purchaser is
able to bear the economic risks of such investment.
3. The Purchaser understands that the 2020 Bonds are limited obligations of the District secured
only by a pledge of Special Taxes and other assets pledged therefor under the Fiscal Agent Agreement. See
"INTRODUCTION — Bondowners' Risks" and "SPECIAL RISK FACTORS" in this Official Statement.
VICINITY MAP
$18,055,000-
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(Vista Canyon)
SPECIAL TAX BONDS
2020 SERIES
This Official Statement, which includes the cover page, table of contents and appendices hereto, is
provided to furnish information in connection with the sale, issuance and delivery of City of Santa Clarita
Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series, in the principal
amount of $18, 055, 000" (the "2020 Bonds').
INTRODUCTION
This Introduction is not a summary of this Official Statement. It is only a brief description of and guide
to, and is qualified by, more complete and detailed information contained in the entire Official Statement,
including the cover page and appendices hereto, and the documents summarized or described herein. All
references herein to any document are qualified by the terms of such document in its entirety. A full review
should be made of the entire Official Statement. The offering of the 2020 Bonds to potential investors is made
only by means of the entire Official Statement.
All capitalized terms used herein and not otherwise defined have the meanings set forth in
APPENDIX C — "SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT" or in
APPENDIX D — "RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX."
Restricted Distribution
Investment in the 2020 Bonds involves risks not deemed suitable for all investors. Among, other
matters, the development of the District as described herein requires completion of infrastructure and private
improvements for which Vista Canyon Ranch (defined below) has not secured financing. Accordingly, the 2020
Bonds will initially be sold in minimum $100,000 denominations to Qualified Institutional Buyers and
Accredited Investors. See "Notice to Purchasers" herein.
The City
The City of Santa Clarita (the "City") is located in the Santa Clarita Valley in northern Los Angeles
County, approximately 35 miles northwest of downtown Los Angeles. The City encompasses an area of
approximately 66 square miles and, as of January 1, 2019, had an estimated population of approximately
218,103 as reported by the California Department of Finance. For general demographic information regarding
the City see APPENDIX A — "INFORMATION RELATING TO THE CITY OF SANTA CLARITA."
The 2020 Bonds are not a debt of the City in any respect.
The Community Facilities District
The Mello -Roos Community Facilities Act of 1982, as amended, constituting Section 53311 et seq. of
the Government Code of the State of California (the "Act"), was enacted by the California legislature to provide
an alternative method of financing certain public capital facilities and services, especially in developing areas of
the State. Any local agency (as defined in the Act) may establish a district to provide for and finance the cost of
. Preliminary, subject to change.
eligible public facilities and services. Generally, the legislative body of the local agency which forms a district
acts on behalf of such district as its legislative body. Subject to approval by two-thirds of the votes cast at an
election of the qualified electors within such district and compliance with the other provisions of the Act, a
legislative body of a local agency may issue bonds for a district and may levy and collect a special tax within
such district to repay such indebtedness (see "SECURITY AND SOURCES OF PAYMENT FOR THE 2020
BONDS — The Special Taxes" herein).
The City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) (the "District") was
formed and established by the City pursuant to the Act following a public hearing and a landowner election,
held on April 12, 2016, in which the landowners as the qualified electors of the District, by more than a
two-thirds majority vote, approved the levy of a special tax (the "Special Tax") pursuant to a Rate and Method
of Apportionment of Special Tax (the "RMA") and authorized the District to incur bonded indebtedness in one
or more series in an aggregate amount not to exceed $45,000,000 (the `Bonds"). The 2020 Bonds in the
principal amount of $18,055,000* is the first series of Bonds to be issued by the District. At a later date,
additional series of Bonds, up to an amount equal to $26,945,000% or in such greater amount as may be
authorized by the qualified electors of the District, may be issued on a parity with the 2020 Bonds.
The District includes a portion of the 185-acre master planned community known as Vista Canyon
("Vista Canyon Project") located in the northeast corner of the City. Vista Canyon, when complete, will include
1,100 residential units (including 855 apartment units and 245 single family units), up to 950,000 square feet of
commercial area which will consist of office, retail, and service uses, a water reclamation plant, an 11-acre
public park, up to four parking facilities and a new Metrolink station with a bus transfer station. The District is
located south of the 14 Freeway at the terminus of Lost Canyon Road, north of the existing Metrolink tracks.
See "VISTA CANYON MASTER PLANNED COMMUNITY" herein.
The District includes approximately 82 acres of land, of which approximately 29 acres are expected to
be taxable upon completion of development. Pursuant to the RMA, the taxable property is divided into two
zones: Zone 1 (approximately 16.2 acres at buildout) and Zone 2 (approximately 12.7 acres at buildout). The
land is zoned as specific plan which permits various residential, commercial, mixed -use, office and hotel uses
within a transit -oriented development. Zone 1 is expected to consist of 519 multifamily apartment units,
approximately 79,259 square feet of commercial, retail or service, and approximately 121,718 square feet of
office space at buildout. Zone 2 is expected to consist of 336 multifamily apartment units, 78,300 square feet of
commercial, retail or service, 542,500 square feet of office space and a 200-room hotel.
For the upcoming fiscal year ("Fiscal Year" or "FY") 2020-21 levy, there are expected to be seven
taxable parcels or lots in Zone 1. Of the taxable lots, 3 are currently designated as "Developed," consisting of
480 apartment units, 39,718 square feet of taxable office square footage and 19,859 square feet of taxable retail
square footage, all currently under construction. All Undeveloped Property (as defined in the RMA) within
Zone 1 is within a recorded final map. All taxable property within Zone 2 is designated as "Undeveloped
Property" and ten parcels within Zone 2 are within a recorded final map. Certain onsite infrastructure, including
streets, curbs, gutters, and streetlights within Zone 1 have been completed. See "DEVELOPMENT WITHIN
THE DISTRICT" herein.
Property Ownership
The master developer of Vista Canyon is Vista Canyon Ranch, LLC ("Vista Canyon Ranch"). Vista
Canyon Ranch began acquiring various parcels that make up the property in 2006. In November 2017, Vista
Canyon Ranch sold approximately 13 acres on 3 lots to Jefferson Vista Canyon, LLC ("Jefferson") for
development of 480 apartments in Zone 1. Jefferson is part of the affiliated group of JPI companies ("JPI"). JPI
is a privately -held developer and builder of Class A multi -family residential projects.
. Preliminary, subject to change.
The remaining lots within the District are owned by various subsidiaries of Vista Canyon Ranch as
follows: (a) VC Lincoln I, LLC ("VC Lincoln") has title to an approximately 0.62 acre parcel within Zone 1
which is under construction and nearing completion for a three story mixed -use building with 19,859 square feet
of ground floor retail space and 39,718 square feet of second and third floor office space, (b) VC Lincoln has
title to 2 lots in Zone 1 and 1 lot in Zone 2 in graded pad condition with access and utilities stubbed to lots
projected for development for mixed use, office and retail space, and (c) Vista Canyon Phase I, LLC ("Vista
Canyon Phase I"), has title to the remaining taxable land within the District consisting of 2 lots in Zone 1 in
graded pad condition with access and utilities stubbed to lots projected for office/retail and apartment uses and
18 lots within Zone 2 in various stages of grading for commercial, office, retail, hotel and apartments. See
"DEVELOPMENT WITHIN THE DISTRICT."
THE PARCELS WITHIN THE DISTRICT COMPRISE ONLY A PORTION OF THE VISTA
CANYON PLANNED COMMUNITY.
Property Values
An appraisal of the taxable property within the District, dated December 6, 2019 (the "Appraisal"), was
prepared by Integra Realty Resources, San Francisco, California (the "Appraiser") in connection with issuance
of the 2020 Bonds. The purpose of the Appraisal was to ascertain the market value by ownership of the fee
simple interest of the properties within the District, as well as provide a cumulative or aggregate value of the
properties, as of the December 2, 2019 date of value.
Subject to the assumptions and limitations contained in the Appraisal, the Appraiser estimated that the
market value is $78,700,000 for the property owned by Jefferson, and $45,840,000 for the properties owned by
VC Lincoln and Vista Canyon Phase I, for an aggregate value of $124,540,000. The District has an estimated
overall value -to -lien ratio of 6.90* to 1 based on the appraised values and the principal amount of the 2020
Bonds.
The table below is a summary of the overall value to lien ratio, the value to lien ratio for each Zone and
the value to lien ratio for Developed and Undeveloped Property within the District, based on the estimated
appraised values from the Appraisal, the estimated Fiscal Year 2020-21 levy amount of $842,700* and the
estimated par amount of the 2020 Bonds of $18,055,000.* The par amount of the 2020 Bonds has been allocated
to the taxable parcels in proportion to their respective projected Fiscal Year 2020-21 special tax obligation,
assuming no further development. See "THE DISTRICT -Appraisal," and "—Estimated Value -to -Lien Ratios"
herein.
SUMMARY OF VALUE TO LIEN RATIOS*
BASED ON DISTRICT APPRAISAL AS OF DECEMBER 2, 2019
Overall
Developed
Undeveloped
Value to Lien (to 1)
Value to Lien (to 1)
Value to Lien (to 1)
Zone 1 Zone 2 Total
Zone 1
Zone 1
Zone 2 Total
Total
7.65 5.02 6.90
9.15
2.79
5.02 4.19
Jefferson
10.60
VC Lincoln
4.73
VC Lincoln / Vista
2.79
5.02 4.19
Canyon Phase 1
Source: Special Tax Consultant and Appraisal.
. Preliminary, subject to change.
Additionally, the apartment units within the District, including the parcels owned by Jefferson, are also
subject to a special tax levied and collected by Community Facilities District No. 2014-1 of the Sulphur Springs
Union School District ("Sulphur Springs CFD"). The Sulphur Springs CFD is authorized to issue up to $19.5
million of special tax bonds secured by the special tax revenues generated by such community facilities district.
Vista Canyon Ranch estimates that at full buildout of the Vista Canyon Project, the property within the District
will also bear approximately 42% of the total special taxes levied by the Sulphur Springs CFD.
There is no assurance that the property within the District can be sold for the appraised value described
herein, or for a price sufficient to pay the principal of and interest on the 2020 Bonds in the event of a default in
payment of Special Taxes by the current landowners or future landowners within the District. See "SPECIAL
RISK FACTORS — Appraised Valuations; Value -to -Lien Ratios" and APPENDIX G — "APPRAISAL
REPORT" herein.
Authority for Issuance of the 2020 Bonds
The 2020 Bonds are issued pursuant to the Mello -Roos Community Facilities Act of 1982, as amended,
and a Fiscal Agent Agreement dated as of February 1, 2020 (the "Fiscal Agent Agreement") by and between the
District and U.S. Bank National Association, as fiscal agent (the "Fiscal Agent"). See "THE 2020 BONDS —
Authority for Issuance" herein.
Purpose of the 2020 Bonds
The 2020 Bonds are being issued for the purpose of (i) funding the acquisition and construction of
certain public facilities including all or a portion of a public parking structure, the five -level Cooper Street
parking facility, and a transit center, (ii) funding a reserve account for the 2020 Bonds and additional series of
Bonds, and (iii) paying certain costs associated with the formation of the District and with the issuance of the
2020 Bonds. See "THE 2020 BONDS — Purpose of the 2020 Bonds" and "FINANCING PLAN — Sources and
Uses of Proceeds" herein.
Security and Sources of Payment for the 2020 Bonds
The 2020 Bonds are limited obligations of the District payable solely from and secured by a pledge of
the Special Taxes and other amounts in the Special Tax Fund.
Special Taxes are defined in the Fiscal Agent Agreement to mean the Special Tax For Facilities (as
defined in the RMA) authorized to be levied by the District on parcels within the District in accordance with the
Resolution of Formation, the Act and the voter approval obtained at the April 12, 2016 election in the District
and any additional special taxes authorized to be levied by the District from time to time that are pledged by the
District to the repayment of the 2020 Bonds and any additional series of Bonds, together with the proceeds
collected from the sale of property pursuant to the foreclosure provisions of this Fiscal Agent Agreement for the
delinquency of such Special Taxes For Facilities remaining after the payment of all the costs related to such
foreclosure actions, including, but not limited to, all legal fees and expenses, court costs, consultant and title
insurance fees and expenses.
The Special Tax Fund, created by the Fiscal Agent Agreement, is held by the Fiscal Agent in trust.
Pursuant to the Fiscal Agent Agreement, after the required annual deposit into the Administrative Expense
Fund, the District will transfer the Special Taxes, within ten (10) Business Days of receipt, to the Fiscal Agent
for deposit in the Special Tax Fund.
Investment in the 2020 Bonds is speculative in nature and involves a degree of risk. No ratings have
been requested or are being provided for the 2020 Bonds. The 2020 Bonds are initially being offered in
authorized denominations of $100,000 or any integral multiple of $5,000 in excess thereof and can only be
transferred in lower denominations as described herein under the heading "THE 2020 BONDS — Transfer
Restrictions" upon the occurrence of certain events. Additionally, the 2020 Bonds may only be sold to Qualified
Institutional Buyers or Accredited Investors until the occurrence of such events.
Neither the faith and credit nor the taxing power of the District (except as pledged in the Fiscal
Agent Agreement), the City, the County, the State of California or any political subdivision thereof is
pledged to the payment of the 2020 Bonds. Except for the Special Taxes, no other revenues or taxes are
pledged to the payment of the 2020 Bonds. The 2020 Bonds are not general or special obligations of the
City nor general obligations of the District, but are limited obligations of the District payable solely from
Special Taxes and amounts held under the Fiscal Agent Agreement as more fully described therein.
See "SECURITY FOR THE 2020 BONDS" herein.
Reserve Account for the Bonds.
As additional security for the 2020 Bonds and any additional series of Bonds, the Fiscal Agent
Agreement provides for the establishment of the Reserve Account within the Special Tax Fund in the amount of
the Reserve Requirement. The "Reserve Requirement" as defined under the Fiscal Agent Agreement means as
of any calculation date, the lesser of (i) ten percent (10%) of the original proceeds of the Bonds, (ii) 80% of the
Maximum Annual Debt Service on the Outstanding Bonds, or (iii) 125% of the average Annual Debt Service on
the Outstanding Bonds, as determined by the District. As of the date of issuance of the 2020 Bonds, the Reserve
Requirement will be fully funded in the amount of $1,152,320*. See "SECURITY FOR THE 2020 BONDS —
Reserve Account" herein.
Foreclosure Proceeds
The District will covenant that it will commence judicial foreclosure proceedings against all parcels
owned by a property owner where the aggregate delinquent Special Taxes on such parcels is greater than
$25,000 not later than ninety (90) days following the date in which such Special Taxes were due and will
commence judicial foreclosure proceedings against all parcels with delinquent Special Taxes not later than
ninety (90) days following the date in which such Special Taxes were due where it receives Special Taxes in an
amount which is less than 95% of the total Special Tax due from properties within the District. Commencement
of any judicial foreclosure proceedings includes the District's efforts to collect the delinquent Special Taxes by
sending subsequent notice of delinquency and a demand for immediate payment thereof. See "SECURITY FOR
THE 2020 BONDS — Covenant for Superior Court Foreclosure" herein.
There is no assurance that the property interests within the District against which the Special Taxes are
levied can be sold at foreclosure or otherwise for the appraised values described herein, or for a price sufficient
to pay the principal of and interest on the 2020 Bonds in the event of a default in payment of Special Taxes by
the current or future landowners within the District. See "SPECIAL RISK FACTORS —Appraised Valuations;
Value -to -Lien Ratios."
Additional Series of Bonds
At the April 12, 2016 election, the qualified electors authorized the District to incur bonded
indebtedness in an amount not to exceed $45,000,000. The 2020 Bonds constitute the first series of the total
authorization of $45,000,000 of Bonds. At a later time, additional series of Bonds, up to an amount equal to
$ *, or in such greater amount as may be authorized by the qualified electors of the District, may be
issued on a parity with the 2020 Bonds to fund up to two additional parking garages, a portion of the City transit
center and other related public improvements. See "THE 2020 BONDS — Additional Series of Bonds" herein.
. Preliminary, subject to change.
Other taxes and/or special assessments with liens equal in priority to the continuing lien of the Special
Taxes, including special taxes levied on apartment units within the District by Sulphur Springs CFD, may also
be levied in the future on the property within the District which could adversely affect the willingness of the
owners of the taxable parcels within the District to pay the Special Taxes when due. See "SPECIAL RISK
FACTORS —Parity Taxes and Special Assessments" herein.
Description of the 2020 Bonds
Registration, Transfers and Exchanges. The 2020 Bonds will be issued in fully registered form and will
be registered initially in the name of Cede & Co., as nominee of The Depository Trust Company, New York,
New York ("DTC"). DTC will act as securities depository for the 2020 Bonds. See "THE 2020 BONDS —
Description of the 2020 Bonds" herein.
Denominations. The 2020 Bonds will initially be issued in denominations of $100,000 or any integral
multiple of $5,000 in excess thereof. Upon the occurrence of a Trigger Event (as defined herein), the 2020
Bonds will automatically be converted to authorized denominations of $5,000 or any integral multiple thereof.
See "THE BONDS — Transfer Restrictions" herein.
Payments. Interest on the 2020 Bonds is payable on September 1, 2020, and semiannually thereafter on
each March 1 and September 1. So long as DTC, or Cede & Co. as its nominee, is the registered owner of the
2020 Bonds, principal and interest payments on the 2020 Bonds will be made directly to DTC. See "THE 2020
BONDS — Description of the 2020 Bonds" herein.
Redemption. The 2020 Bonds are subject to optional and mandatory redemption as described under
"THE 2020 BONDS — Redemption Provisions" herein.
Tax Exemption
Assuming compliance with certain covenants and provisions of the Internal Revenue Code of 1986, as
amended, in the opinion of Bond Counsel, interest on the 2020 Bonds is excluded from the gross income of the
owners thereof for federal income tax purposes although it may be includable in the calculation for certain
taxes.. Also in the opinion of Bond Counsel, interest on the 2020 Bonds will be exempt from State of California
personal income taxes. See "TAX MATTERS — Tax Exemption" herein.
Professionals Involved in the Offering
All proceedings in connection with the issuance of the 2020 Bonds are subject to the approval of Norton
Rose Fulbright US LLP, Los Angeles, California, Bond Counsel to the District. Norton Rose Fulbright US LLP
is also Disclosure Counsel to the District. Columbia Capital Management, LLC, Glendale, California, is
Municipal Advisor to the District. Stradling Yocca Carson & Rauth P.C., Newport Beach, California, is counsel
to the Underwriter. U.S. Bank National Association, Los Angeles, California, will act as the Fiscal Agent.
Norton Rose Fulbright US LLP, Columbia Capital Management, LLC, and U.S. Bank National Association will
receive compensation from the District contingent upon the sale and delivery of the 2020 Bonds. Norton Rose
Fulbright US LLP has represented Jefferson in its acquisition of property within the District and represents JPI
from time to time on matters unrelated to the Bonds.
Offering and Delivery of the 2020 Bonds
The 2020 Bonds are offered when, as and if issued, subject to approval as to their legality by Bond
Counsel. It is anticipated that the 2020 Bonds in book -entry form will be available for delivery on or about
February , 2020.
Bondowners' Risks
The 2020 Bonds are limited obligations of the District and payable only from Special Taxes and other
amounts in the Special Tax Fund. The District has no obligation to pay debt service on the 2020 Bonds other
than from the Special Taxes and other amounts in the Special Tax Fund.
Ownership of the taxable parcels within the Community Facilities District is currently concentrated in
two principal landowners. Timely payment of interest and principal on the 2020 Bonds will depend on the
continuing ability and willingness of the owners of the property to pay Special Taxes when due.
Neither the faith and credit nor the taxing power of the District (except as pledged in the Fiscal Agent
Agreement), the City, the County of Los Angeles, the State of California or any political subdivision thereof is
pledged to the payment of the 2020 Bonds. Except for the Special Taxes, no other revenues or taxes are pledged
to the payment of the 2020 Bonds. The 2020 Bonds are not general or special obligations of the City nor
general obligations of the District, but are limited obligations of the District payable solely fi^om Special Taxes
and amounts held under the Fiscal Agent Agreement as more fully described herein.
See "SPECIAL RISK FACTORS" herein for a discussion of the risk factors that should be considered,
in addition to the other matters set forth herein, in considering the investment quality of the 2020 Bonds.
Continuing Disclosure
In order to assist the Underwriter in complying with Rule 15c2 12(b)(5) adopted by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to
time, the District has covenanted to provide certain financial information and operating data and notices of
certain material events relating to the District.
In addition, although not obligated parties, Vista Canyon Ranch and Jefferson have covenanted in a
written undertaking to provide certain information regarding their respective parcels and the development
thereof. See "CONTINUING DISCLOSURE" herein.
Other Information
This Official Statement speaks only as of its date, and the information contained herein is subject to
change
Copies of documents referred to herein, including the complete Appraisal, and information concerning
the 2020 Bonds are available from the Treasurer, City of Santa Clarita, 23920 Valencia Boulevard, Suite 295,
Santa Clarita, California 91355; telephone (661) 255-4925. The City or the District may impose a charge for
copying, mailing and handling.
THE 2020 BONDS
Authority for Issuance
The District was formed and bonded indebtedness was authorized pursuant to the Act, proceedings
taken by the City Council of the City and at a special election held on April 12, 2016 in the District. Bonded
indebtedness was authorized in one or more series of bonds in the aggregate amount not to exceed $45,000,000.
Under the provisions of the Act, since there were fewer than 12 registered voters residing within the District at
the time of the election, the qualified landowner voter was entitled to cast one vote for each acre or portion of an
acre of land owned within the District. The landowners who comprised the qualified voters in the District voted
to incur the bonded indebtedness and to approve, for the purpose of repaying the indebtedness, the annual levy
of Special Taxes to be collected within the District.
The 2020 Bonds are the first series of Bonds to be issued by the District and are authorized and issued
pursuant to the Act and the Fiscal Agent Agreement.
Purpose of the 2020 Bonds
The 2020 Bonds are being issued to fund the acquisition and construction of certain public
improvements, including all or a portion of public parking structures, namely the Cooper Street parking facility,
and a portion of the City's transit center, within the Vista Canyon master planned community.
Proceeds of the 2020 Bonds will also fund (i) the Reserve Account, and (ii) the Costs of Issuance Fund.
See "FINANCING PLAN - Sources and Uses of Proceeds" herein.
Description of the 2020 Bonds
The 2020 Bonds will be dated as of their Delivery Date, and interest thereon will be payable
semi-annually on March 1 and September 1 of each year, commencing on September 1, 2020 (each an "Interest
Payment Date"), until their respective stated maturity dates or prior redemption. The principal of the 2020
Bonds will be payable on September 1, in the years and principal amounts set forth on the inside cover page
hereof, unless redeemed prior to their respective stated maturity dates.
Interest on the 2020 Bonds
Each 2020 Bond is to bear interest from the Interest Payment Date next preceding the date of
authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it will bear
interest from such Interest Payment Date; (ii) it is authenticated after the fifteenth day of the month preceding an
Interest Payment Date (the "Record Date") and before such Interest Payment Date, in which event it will bear
interest from such Interest Payment Date; or (iii) such 2020 Bond is authenticated on or prior to August 15,
2020, in which event interest thereon will be payable from its dated date.
General Book -Entry Provisions
The 2020 Bonds will be issued as fully registered 2020 Bonds and, when issued, will be registered in the
name of Cede & Co., as nominee of The Depository Trust Company, New York, New York ("DTC"). DTC will
act as securities depository of the 2020 Bonds. Individual purchasers of the 2020 Bonds (the `Beneficial
Owners") will not receive certificates representing the 2020 Bonds purchased. So long as Cede & Co., as
nominee of DTC, is the registered owner of the 2020 Bonds, references herein to the Owners will mean Cede &
Co. (or such other nominee), as the "Owner" of the 2020 Bonds, and will not mean the Beneficial Owners of the
2020 Bonds. Individual purchases of the 2020 Bonds will be made in book -entry form only, initially in the
principal amount of $100,000 or any integral multiple thereof. Upon the issuance of a second series of the
Bonds on parity with the 2020 Bonds or the filing of an Annual Report pursuant to the Issuer Continuing
Disclosure Certificate which contains information that the Assigned Special Tax that could be levied on
Developed Property is at least equal to 100% of the Annual Debt Service on the 2020 Bonds (the "Trigger
Events"), the 2020 Bonds will automatically be converted to authorized denominations of $5,000 or any integral
multiple thereof. Principal and interest are payable directly to DTC. Upon receipt of payments of principal and
interest, DTC will in turn remit such principal and interest to the DTC Participants (as such term is defined in
APPENDIX E — "BOOK -ENTRY ONLY SYSTEM") for subsequent disbursement to the Beneficial Owners of
the 2020 Bonds.
DTC may discontinue providing its services as securities depository with respect to the 2020 Bonds at
any time by giving reasonable notice to the District or the Fiscal Agent, or the District may discontinue the
services of DTC. Under such circumstances, in the event that a successor securities depository is not obtained,
2020 Bond certificates are required to be printed and delivered.
Replacement Bonds
In the event (i) DTC determines not to continue to act as securities depository for the 2020 Bonds, or (ii)
DTC shall no longer so act and gives notice to the Fiscal Agent of such determination or (iii) the District so
determines, then the District will discontinue the book -entry system with DTC. If the District fails to identify
another qualified securities depository, the 2020 Bonds will no longer be restricted to being registered in the
name of Cede & Co., as nominee of DTC, but shall be registered in whatever name or names as are provided to
the Fiscal Agent and the Fiscal Agent will deliver definitive 2020 Bonds to the Owners thereof.
The 2020 Bonds may be transferred only upon the books kept for the registration of the 2020 Bonds or
exchanged upon the surrender thereof to the Fiscal Agent, together with an assignment duly executed by the
Owner or his attorney or legal representative, in form satisfactory to the Fiscal Agent. All such 2020 Bonds will
be surrendered to the Fiscal Agent and canceled by the Fiscal Agent pursuant to the Fiscal Agent Agreement.
Upon any such registration or transfer, a new 2020 Bond or Bonds will be authenticated and delivered in
exchange for such transferred 2020 Bond in accordance with the provisions of the Fiscal Agent Agreement. The
Fiscal Agent may make a charge to the Owner for any such exchange or registration or transfer of 2020 Bonds
sufficient to pay any tax or other governmental charge required to be paid with respect to any such exchange or
registration of transfer. Neither the District nor the Fiscal Agent will be required to register the transfer of or
exchange of any 2020 Bond during the 15 days immediately preceding the date on which 2020 Bonds are to be
selected for redemption.
New 2020 Bonds delivered upon any transfer or exchange will be valid obligations of the District,
evidencing the same obligations as the 2020 Bonds surrendered, will be secured by the Fiscal Agent Agreement
and will be entitled to all of the security and benefits thereof to the same extent as the 2020 Bonds surrendered.
The District and the Fiscal Agent may deem and regard the Owner of any 2020 Bond as the absolute
owner of such 2020 Bond for the purpose of receiving any payment on such 2020 Bond and for all other
purposes of the Fiscal Agent Agreement, whether such 2020 Bond is overdue or not, and neither the District nor
the Fiscal Agent will be affected by any notice to the contrary. The principal of the 2020 Bonds and any
premiums due upon the redemption thereof will be payable upon presentation and surrender thereof at the
Principal Office of the Fiscal Agent or at the designated office of any successor Fiscal Agent. Interest on any
2020 Bond will be paid by check of the Fiscal Agent mailed on the Interest Payment Date by first class mail,
postage prepaid, to the person whose name shall appear in the Bond Register as the Owner thereof at his or her
address as it appears on the Bond Register. All such payments will be valid and effectual to satisfy and
discharge the liability upon such 2020 Bond to the extent of the sum or sums so paid.
Redemption
Optional Redemption*
The 2020 Bonds are subject to redemption prior to maturity at the option of the District on any Interest
Payment Date on or after September 1, 2027, as a whole or in part, by lot, from any available source of funds at
the following redemption prices (expressed as a percentage of the principal amount of 2020 Bonds to be
redeemed), together with accrued interest thereon to the date fixed for redemption:
. Preliminary, subject to change.
Redemption Dates Redemption Prices
September 1, 2027 and March 1, 2028 102%
September 1, 2028 and March 1, 2029 101
September 1, 2029 and every March 1 and September 1 thereafter 100
Special Mandatory Redemption f om Special Tax Prepayments*
The 2020 Bonds are subject to mandatory redemption prior to maturity on any Interest Payment Date on
or after September 1, 2020, as a whole or in part, in a manner determined by the District from prepayments of
Special Taxes at the following redemption prices (expressed as a percentage of the principal amount of 2020
Bonds to be redeemed), together with accrued interest thereon to the date fixed for redemption:
Redemption Dates
September 1, 2020 and every March 1 and September
including March 1, 2027
September 1, 2027 and March 1, 2028
September 1, 2028 and March 1, 2029
September 1, 2029 and every March 1 and September
Redemption Prices
1 through and
103%
102
101
1 thereafter 100
See the caption "SPECIAL RISK FACTORS — Potential Early Redemption from Special Tax
Prepayments" for the potential of a lower than expected yield on the 2020 Bonds as a result of a special
mandatory redemption from prepayment of Special Taxes.
In connection with such redemption, the District may also apply amounts in the Reserve Account which
will be in excess of the Reserve Requirement as a result of such Special Tax prepayment to redeem 2020 Bonds
as set forth above and in accordance with Section G of the RMA.
In the event the District elects to optionally redeem or redeem from Special Tax prepayments the 2020
Bonds as provided above, the District will give written notice to the Fiscal Agent of its election to so redeem,
the redemption date and the principal amount of the 2020 Bonds of each maturity to be redeemed. The notice to
the Fiscal Agent will be given at least 30 but no more than 90 days prior to the redemption date, or by such later
date as is acceptable to the Fiscal Agent, in its sole discretion.
Mandatory Sinking Fund Redemption
The Term 2020 Bonds maturing on September 1, 20, and on September 1, 20_ are subject to
mandatory redemption, in part by lot, on September 1 in each year commencing September 1, 20_ with respect
to the Term 2020 Bonds maturing on September 1, 20_, and commencing September 1, 20 with respect to
the Term 2020 Bonds maturing on September 1, 20 , from the Sinking Fund Payments that have been
deposited into the Redemption Account at a redemption price equal to the principal amount thereof to be
redeemed, without premium, plus accrued interest thereon to the date of redemption as set forth in the following
schedule; provided, however, that (i) in lieu of redemption thereof, the Term 2020 Bonds may be purchased by
the District and tendered to the Fiscal Agent, and (ii) if some but not all of the Term 2020 Bonds have been
optionally redeemed or redeemed from Special Tax prepayments, the total amount of all future sinking
payments will be reduced by the aggregate principal amount of the Term 2020 Bonds so redeemed, to be
allocated among such sinking payments on a pro rata basis (as nearly as practicable) in integral multiples of
$5,000 as determined by the District.
10
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1) Principal Amount
(maturity)
Term 2020 Bonds Maturing on September 1, 20
Redemption Date
(September 1) Principal Amount
(maturity)
Redemption Provisions
Notice of Redeinption
Notice of redemption, containing the information required by the Fiscal Agent Agreement, will be
mailed by the Fiscal Agent to Owners at least 30 days but not more than 60 days prior to the date fixed for
redemption. The Fiscal Agent must also give notice of redemption to the registered securities depositories then
in the business of holding substantial amounts of obligations of types comprising the 2020 Bonds and to the
Information Services.
The Fiscal Agent may issue a conditional notice of optional redemption to the Owners in the same
manner as provided above. Such conditional notice may be rescinded, redemption may be canceled and none of
such 2020 Bonds will be redeemed in the event sufficient funds have not been deposited with the Fiscal Agent
on the redemption date.
Effect of Redemption
If notice of redemption has been given substantially as provided in the Fiscal Agent Agreement, and if
the amount necessary for the redemption of the 2020 Bonds, or portions thereof called for redemption, is
available on the date set for redemption, then the 2020 Bonds or portions thereof designated for redemption shall
become due and payable on the date fixed for redemption. Upon and after the date fixed for redemption, the
2020 Bonds so fixed for redemption will no longer be deemed outstanding and will cease to accrue interest from
and after such redemption date. The actual receipt of such notice of redemption by the Owner of any 2020 Bond
is not a condition precedent to redemption, and failure to receive such notice will not affect the validity of the
proceedings for redemption of such 2020 Bonds or the cessation of interest thereon.
Transfer Restrictions
Prior to the Trigger Event Date (defined below), no transfer, sale or other disposition of any 2020 Bond,
or any beneficial interest therein, may be made except to an entity that the transferor reasonably believes is
either (i) a "Qualified Institutional Buyer" within the meaning of Rule 144A promulgated under the Securities
Act of 1933, as amended, and the rules, regulations and published interpretations of the Securities and Exchange
Commission promulgated thereunder from time to time, (collectively, the "Securities Act of 1933"), that is
11
purchasing such 2020 Bond for its own account for investment purposes and not with a view to distributing such
2020 Bond, or (ii) an "Accredited Investor" as defined in Section 501(a) of Regulation D promulgated under the
Securities Act of 1933 that is purchasing such 2020 Bond for its own account for investment purposes and not
with a view to distributing such 2020 Bond. Each transferee of a 2020 Bond, or any beneficial interest therein,
by its purchase thereof, will be deemed to have represented that such transferee is a Qualified Institutional Buyer
or an Accredited Investor that is purchasing such 2020 Bond for its own account for investment purposes and
not with a view to distributing such 2020 Bond.
The 2020 Bonds will bear a legend describing or referencing the restrictions on transferability set forth
in the Fiscal Agent Agreement.
Each entity which is or which becomes a Beneficial Owner of a 2020 Bond prior to the Trigger Event
Date will be deemed by the acceptance or acquisition of such beneficial ownership interest to have agreed to be
bound by the transfer restrictions provisions of the Fiscal Agent Agreement. The transferor of a 2020 Bond
transferred prior to the Trigger Event Date will be deemed to have agreed to provide notice to any proposed
assignee of a beneficial ownership interest in the purchased 2020 Bond of the restrictions on transfer described
herein.
The restrictions on transfer of the 2020 Bonds described above will no longer be applicable to transfers
of the 2020 Bonds or any beneficial interest therein on the date of a Trigger Event (the "Trigger Event Date").
A Trigger Event is defined under the Fiscal Agent Agreement as (a) the issuance by the District of an additional
series of Bonds on parity with the 2020 Bonds, or (b) the filing of an Annual Report pursuant to the Issuer
Continuing Disclosure Certificate which contains information that the Assigned Special Tax that could be levied
on Developed Property is at least equal to 100% of Debt Service on the 2020 Bonds. The District is under no
obligation to issue an additional series of the Bonds. See `APPENDIX C — CONTINUING DISCLOSURE
CERTIFICATES — Issuer Continuing Disclosure Certificate."
Additional Series of Bonds
In addition to the 2020 Bonds, the District may issue additional Series of Bonds up to an amount equal
to $26,945,000,* or in such greater amount as may be authorized by the qualified electors of the District, on a
parity with the 2020 Bonds. Any such Series will constitute Bonds under the Fiscal Agent Agreement and will
be secured by a lien on the Special Taxes (other than the Special Taxes to be deposited into the Administrative
Expense Fund) and funds pledged for the payment of the Bonds thereunder on a parity with all other Bonds
Outstanding under the Fiscal Agent Agreement. The District may issue such additional Series subject to the
following specific conditions precedent:
(a) Compliance. The District will be in compliance with the Fiscal Agent Agreement and all
Supplemental Fiscal Agent Agreements or will be in compliance immediately following the issuance of
such Series, and issuance of a Series will not cause the District to exceed the District's limitation on
debt.
(b) Purpose. The purposes for which such Series of Bonds are to be issued; provided, that the
proceeds of the sale of such Series of Bonds will be applied only for the purpose of providing funds to
(A) pay the costs of the Project, (B) refund any Bonds issued under the Fiscal Agent Agreement, (C)
pay capitalized interest on such Series of Bonds, (D) pay Costs of Issuance incurred in connection with
the issuance of such Series of Bonds, and (D) make any deposit to the Reserve Account required
pursuant to the Fiscal Agent Agreement;
. Preliminary, subject to change.
12
(c) Same Payment Dates. The Supplemental Fiscal Agent Agreement providing for the
issuance of such Series will provide that interest thereon shall be payable on Interest Payment Dates,
and principal thereof shall be payable on September 1 in any year in which principal is payable on such
Series (provided that there shall be no requirement that any Series pay interest on a current basis).
(d) Separate Funds; Reserve Account Deposit. The Supplemental Fiscal Agent Agreement
providing for the issuance of such Series may provide for the establishment of separate funds and
accounts. Subject to the provisions of the Fiscal Agent Agreement, the Supplemental Fiscal Agent
Agreement will provide for an amount to be deposited into the Reserve Account of the Special Tax
Fund so that the balance on deposit in the Reserve Account is increased to an amount at least equal to
the Reserve Requirement following the issuance of such Series of Bonds; and an amount at least equal
to the Reserve Requirement will thereafter be maintained in the Reserve Account. Such deposit will be
made as provided in the Supplemental Fiscal Agent Agreement providing for the issuance of such
additional Series and may be made from the proceeds of the sale of such additional Series or from other
funds.
(e) Aggregate Value -to -Lien. The aggregate CFD Value of all Taxable Property on the date of
adoption of the Supplemental Fiscal Agent Agreement authorizing the issuance of such series of Bonds
shall be at least four (4) times the sum of (i) the aggregate principal amount of all Bonds then
Outstanding, plus (ii) the aggregate principal amount of the additional Series proposed to be issued, plus
(iii) the aggregate principal amount of any fixed assessment liens on the parcels in the CFD subject to
the levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other
community facilities district bonds then outstanding and payable at least partially from special taxes to
be levied on parcels of land within the CFD (the "Other District Bonds") equal to the aggregate
outstanding principal amount of the Other District Bonds multiplied by a fraction, the numerator of
which is the amount of special taxes levied for the Other District Bonds on parcels of land within the
CFD subject to the Special Taxes, and the denominator of which is the total amount of special taxes
levied for the Other District Bonds on all parcels of land against which such special taxes are levied to
pay the Other District Bonds based upon information from the most recent available Fiscal Year. CFD
Value is defined in the Fiscal Agent Agreement as value established by appraisal, assessed value or both
of property subject to the special tax. See "APPENDIX C - SUMMARY OF CERTAIN PROVISIONS
OF THE FISCAL AGENT AGREEMENT" herein for the complete definition.
(f) Undeveloped Property Aggregate Value -to -Lien. The aggregate CFD Value of all Taxable
Property that is designated Undeveloped Property on the date of adoption of the Supplemental Fiscal
Agent Agreement authorizing the issuance of such series of Bonds shall be at least three (3) times the
sum of (i) the Proportionate Share of the aggregate principal amount of all Bonds then Outstanding,
plus (ii) the Proportionate Share of the aggregate principal amount of the additional Series proposed to
be issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels of
Undeveloped Property in the CFD subject to the levy of Special Taxes, plus (iv) the portion of the
aggregate principal amount of any Other District Bonds equal to the aggregate outstanding principal
amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of
special taxes levied for the Other District Bonds on parcels of taxable Undeveloped Property within the
CFD, and the denominator of which is the total amount of special taxes levied for the Other District
Bonds on all parcels of land against which such special taxes are levied to pay the Other District Bonds
based upon information from the most recent available Fiscal Year.
(g) Aggregate Coverage. For each Fiscal Year after issuance of the proposed Series, the
maximum amount of the Special Taxes that may be levied for such Fiscal Year under the Ordinance, the
Fiscal Agent Agreement and any Supplemental Fiscal Agent Agreement on (i) all parcels then classified
as Developed Property or to be classified as Developed Property in the subsequent Fiscal Year based on
the actual issuance of a building permit for new construction and (ii) all parcels classified as
Undeveloped Property assuming such Undeveloped Property is taxed as Developed Property based on
13
the expected development for each such parcel, both not then delinquent in the payment of any prior or
current years' Special Taxes, less the Administrative Expense Requirement for each respective Fiscal
Year, shall be at least 110% of the total Annual Debt Service of the then Outstanding Bonds and the
proposed Series of Bonds for each Bond Year that commences in each such Fiscal Year.
(h) Developed Property Coverage. For each Fiscal Year after issuance of the proposed Series,
the Assigned Special Taxes that may be levied for such Fiscal Year under the Ordinance, the Fiscal
Agent Agreement and any Supplemental Fiscal Agent Agreement on all parcels then classified as
Developed Property or to be classified as Developed Property in the subsequent Fiscal Year based on
the actual issuance of a building permit for new construction, both of which not then delinquent in the
payment of any prior or current years' Special Taxes, less the Administrative Expense Requirement for
each respective Fiscal Year, shall be at least [45%] of the total Annual Debt Service of the then
Outstanding Bonds and the proposed Series of Bonds for each Bond Year that commences in each such
Fiscal Year.
(i) Certificates. The District will deliver to the Fiscal Agent a Certificate of Authorized
Representative of the District certifying that the conditions precedent to the issuance of such Series set
forth in paragraphs (a) through (h) above have been satisfied.
0) Opinion. An Opinion of Bond Counsel to the effect that execution of the Supplemental
Fiscal Agent Agreement has been duly authorized by the District in accordance with the Fiscal Agent
Agreement and that such Series, when duly executed by the District and authenticated and delivered by
the Fiscal Agent, will be valid and binding obligations of the District.
Notwithstanding the foregoing, the District may issue bonds to refund all or a portion of one or more
Series without the need to satisfy the requirements of paragraphs (e) through (h) above, and, in connection
therewith, the Certificate of Authorized Representative of the District in paragraph (i) above need not make
reference to paragraphs (e) through (h); provided a certification is made that Maximum Annual Debt Service on
all Outstanding Bonds following the issuance of such refunding bonds is less than or equal to Maximum Annual
Debt Service on all Outstanding Bonds prior to the issuance of such refunding bonds.
The District may also issue any other bonds or otherwise incurring debt secured by a pledge of the
Special Taxes (other than the Special Taxes to be deposited into the Administrative Expense Fund) which are
subordinate to the pledge securing the 2020 Bonds.
FINANCING PLAN
On January 28, 2020, the City Council of the City (the "City Council"), acting as the legislative body of
the District, authorized the issuance of the 2020 Bonds. Proceeds from the sale of the 2020 Bonds will be used
to (i) fund the acquisition and construction of certain public improvements, including all or a portion of a public
parking structure, the Cooper Street parking facility, and a portion of the City's transit center, within the Vista
Canyon master planned community, (ii) fund a reserve account for the 2020 Bonds and any additional Series of
Bonds, and (iii) pay certain costs associated with the formation of the District and with the issuance of the 2020
Bonds.
The five -level, 613-space Cooper Street Parking Facility is estimated to cost $15.3 million to construct,
and is currently under construction with an expected completion date of February 15, 2020. The City is to
acquire the Cooper Street Parking Facility when complete (exclusive of the sale back to Vista Canyon Ranch of
easements for 84 parking spaces) for a purchase price estimated to be $15.02 million. ARB Structures of Lake
Forest, California, is the contractor for the Cooper Street Parking Facility and specializes in parking structure
construction. The City is expected to enter into (a) a management agreement with Vista Canyon Master
Association, a California non-profit mutual benefit corporation (the "POA"), to manage, operate and maintain
the Cooper Street Parking Facility, (b) a parking spaces acquisition agreement with Vista Canyon Ranch for a
14
perpetual easement for 84 parking spaces in the Cooper Street Parking Facility, and (c) an easement with Vista
Canyon Ranch for solar facilities and signage relating to the Cooper Street Parking Facility.
Fifteen percent (15%) of the proceeds deposited into the Acquisition and Construction Fund may be
used to finance any public capital improvements to the City's transit center. The City's transit center consists of
(i) the Vista Canyon Multi -Modal Transit Center (the "Metrolink Station"), which is located within the Vista
Canyon Project, and (ii) the Vista Canyon Regional Transit Center (the "Bus Station") which will serve as a
central core for commuter rail, local and commuter buses, bicycles, and pedestrians for the surrounding
communities. Metrolink is a commuter rail system in Southern California consisting of seven lines and 62
stations operating on 534 miles of rail network. The system operates in Los Angeles, Orange, Riverside, San
Bernardino, and Ventura counties, as well as to Oceanside in San Diego County. It connects with the Los
Angeles County Metro Rail and Metro Busway system, the San Diego Coaster commuter rail and Sprinter light
rail services, and with Amtrak's Pacific Surfliner, Coast Starlight, Southwest Chief, Sunset Limited, and Texas
Eagle intercity rail services. Metrolink owns several hundred miles of rail; however, it also shares some track
with freight trains.
The Metrolink Station will serve the existing Southern California Regional Rail Authority (SCRRA)
Metrolink Antelope Valley line, which runs between Los Angeles Union Station and the city of Lancaster. The
Metrolink Station is adjacent to and will function in conjunction with the Bus Station. The construction contract
for the Bus Station was awarded at the November 26, 2019 City Council meeting to C.S. Legacy Construction,
Inc. This project supports the five-year strategic plan, Santa Clarita 2020, goal of Enhancing Economic Vitality
by expanding transit services to underserved areas.
The Bus Station project is to include seven bus canopies, restrooms and driver breakroom, security
office, minor grading and erosion control and landscape and irrigation. Construction is anticipated to start in
January 2020 and to be completed in Summer 2020. The project is expected to cost approximately $7.8 million
and will be funded by Metro Grant Funds in the amount of $2.8 million and Proposition A Local Return funds,
Municipal Operator Service Improvement Program (MOSIP) funds, Transit Mitigation fees, and South Coast
Air Quality Management District (AQMD) funds in the aggregate amount of $5 million.
The contract for construction management services for the Metrolink Station was awarded by the City
Council on October 22, 2019 to RailPros, Irvine, California. This project will consist of a grade -separated
pedestrian crossing to a center track platform, approximately one mile of new railroad track parallel to the
existing track, a new railroad bridge, sound walls, and amenities such as canopies, lighting, benches, a security
system, and landscaping. The new facility will be designed to the minimum Leadership in Energy and
Environmental Design (LEED) Silver Standard rating or equivalent. Bidding for the construction contract is
anticipated in 2020, with award of contract in Spring 2020. Construction is anticipated to begin
thereafter with completion in late Summer 2022. This project is estimated to cost a little over $37 million (hard
costs only). Approximately $3.9 million has been spent to date on design costs. Funding for the hard costs of
the Metrolink Station will include $2.65 million of 2020 Bond proceeds, $21.3 million in grants and $2.8
million in Proposition A Local Return funds, $5.2 million in Measure M funds, and $4 million in Measure R
Highway Operating Improvement funds.
The 2020 Bonds constitute the first series of the total authorization of $45,000,000 of Bonds. At a later
time, additional Series of Bonds, up to an amount equal to $26,945,000*, or in such greater amount as may be
authorized by the qualified electors of the District, may be issued on a parity with the 2020 Bonds.
. Preliminary, subject to change.
15
Sources and Uses of Proceeds
The 2020 Bond proceeds will be applied as follows:
SOURCES OF PROCEEDS
Principal Amount of 2020 Bonds $18,055,000.00'
Plus/Less: Net Original Issue Premium/Discount
Total Proceeds
USES OF PROCEEDS
Reserve Account of the Special Tax Fund')
Parking Project Costs Account of the Acquisition and Construction Fund
Transit Center Project Costs Account of the Acquisition and
Construction Fund
Deposit in Costs of Issuance Fund(2)
Total Uses
(1) The deposit to the Reserve Account is in the amount of the Reserve Requirement.
(2) Includes fees of Bond Counsel, Disclosure Counsel, Municipal Advisor, Fiscal Agent, Special Tax
Consultant, Appraiser, underwriter discount and costs of printing and delivering the Official Statement
and other costs associated with the formation of the District and the issuance of the 2020 Bonds.
[The remainder of this page is intentionally left blank.]
. Preliminary, subject to change.
16
Debt Service Schedule
The following is the debt service schedule for the 2020 Bonds, assuming no redemptions other than
mandatory sinking fund redemptions.
DEBT SERVICE SCHEDULE
Year Ending
September 1 Principal Interest Total
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
TOTAL $18,055,000.00'
. Preliminary, subject to change.
17
SECURITY FOR THE 2020 BONDS
General
NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE DISTRICT (EXCEPT
AS PLEDGED IN THE FISCAL AGENT AGREEMENT), THE CITY, THE COUNTY, THE STATE OF
CALIFORNIA OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF
THE 2020 BONDS. EXCEPT FOR THE SPECIAL TAXES, NO OTHER REVENUES OR TAXES ARE
PLEDGED TO THE PAYMENT OF THE 2020 BONDS. THE 2020 BONDS ARE NOT GENERAL OR
SPECIAL OBLIGATIONS OF THE CITY NOR GENERAL OBLIGATIONS OF THE DISTRICT, BUT ARE
LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM SPECIAL TAXES AND
AMOUNTS HELD UNDER THE FISCAL AGENT AGREEMENT AS MORE FULLY DESCRIBED
11111011►1
The 2020 Bonds are secured by a pledge of Special Taxes and the other amounts in the Special Tax
Fund. Special Taxes means the Special Tax For Facilities (as defined in the RMA) authorized to be levied by
the District on parcels within the District in accordance with the Resolution of Formation, the Act and the voter
approval obtained at the April 12, 2016 election in the District and any additional special taxes authorized to be
levied by the District from time to time that are pledged by the District to the repayment of the 2020 Bonds,
together with the proceeds collected from the sale of property pursuant to the foreclosure provisions of the
Fiscal Agent Agreement for the delinquency of such Special Taxes For Facilities remaining after the payment of
all the costs related to such foreclosure actions, including, but not limited to, all legal fees and expenses, court
costs, consultant and title insurance fees and expenses. The Administrative Expense Requirement is defined to
mean for any Fiscal Year an amount equal to $25,000 for Fiscal Year 2019-20 escalating by two percent per
each Fiscal Year thereafter.
In the event that delinquencies occur in the receipt of the Special Taxes within the District in any
Fiscal Year, the District may increase its Special Tax levy in the following Fiscal Year up to the maximum
amount permitted under the RMA. Although the Special Tax levy may be increased, Special Taxes
resulting from the increased levy will not become available to cure any delinquencies until actually
collected. In addition, an increase in the Special Tax levy may adversely affect the ability or willingness of
property owners to pay their Special Taxes. See "THE DISTRICT — Summary of Rate and Method"
herein for a description of the District's procedures for levying Special Taxes, and "SPECIAL RISK
FACTORS" herein.
INITIALLY, THE 2020 BONDS WILL BE ISSUED IN AUTHORIZED DENOMINATIONS OF
$100,000 OR ANY INTEGRAL MULTIPLE OF $5,000 IN EXCESS THEREOF. OWNERSHIP OF
THE 2020 BONDS IS SUBJECT TO A SIGNIFICANT DEGREE OF RISK. POTENTIAL INVESTORS
ARE ADVISED TO CAREFULLY READ THE SECTION OF THIS OFFICIAL STATEMENT
ENTITLED "SPECIAL RISK FACTORS."
The Special Taxes
The Special Taxes are to be apportioned, levied and collected according to the RMA. See "THE
DISTRICT — Summary of Rate and Method" herein.
Beginning in Fiscal Year 2019-2020 and so long as any Bonds issued under the Fiscal Agent Agreement
are Outstanding, the District has covenanted to levy the Special Tax in an amount sufficient, together with other
amounts on deposit in the Special Tax Fund and the Administrative Expense Fund and available for such
purposes, to pay (i) the principal of and interest on the 2020 Bonds and any additional Series of Bonds when
due, (ii) the Administrative Expenses and (iii) any amounts required to replenish the Reserve Account of the
Special Tax Fund to the Reserve Requirement. Subject to the maximum Special Tax rates, the RMA is
formulated to result in the levy each year of an amount sufficient to pay principal, premium, if any, and interest
18
when due, to replenish the Reserve Account and to pay related administrative expenses. However, see
"SPECIAL RISK FACTORS" for a discussion of certain factors affecting the actual timely collection of such
Special Tax levies.
The District may collect the Special Taxes on the regular property tax bills issued by the Treasurer and
Tax Collector of Los Angeles County or, alternatively, the District may separately bill and collect the Special
Taxes from each record owner of land. The District intends to collect the Special Taxes on the property tax
bills, except for the levy for Fiscal Year 2019-20 in which five parcels owned by Vista Canyon I, LLC were
separately hand billed for a total Special Tax levy of $47,104.34, due on, and delinquent by, the same dates as
the Los Angeles County regular property tax bills.
Special Tax Fund
Pursuant to the Fiscal Agent Agreement, there is established a Community Facilities District No. 2016-1
Special Tax Fund (the "Special Tax Fund") to be held and maintained by the Fiscal Agent. In the Special Tax
Fund there is further established and created an Interest Account, a Principal Account, a Redemption Account
and a Reserve Account.
The amounts on deposit in the foregoing funds and accounts will be held by the Fiscal Agent in trust
and the Fiscal Agent will invest and disburse the amounts in such funds and accounts in accordance with the
provisions of the Fiscal Agent Agreement and will disburse investment earnings thereon in accordance with the
provisions of the Fiscal Agent Agreement.
Following the required annual deposit to the Administrative Expense Fund, the District will, within ten
(10) Business Days of receipt of Special Taxes, transfer the Special Taxes to the Fiscal Agent for deposit in the
Special Tax Fund in accordance with the terms of the Fiscal Agent Agreement to be held in trust. The Fiscal
Agent will transfer the amounts on deposit in the Special Tax Fund on the dates and in the amounts set forth in
the Fiscal Agent Agreement, in the following order of priority, to:
The Interest Account of the Special Tax Fund;
2. The Principal Account of the Special Tax Fund;
The Redemption Account of the Special Tax Fund;
4. The Reserve Account of the Special Tax Fund; and
The Surplus Fund.
Interest Account and Principal Account of the Special Tax Fund
The principal of and interest due on the 2020 Bonds and any additional Series of Bonds until maturity,
other than principal due upon redemption, will be paid by the Fiscal Agent from the Principal Account and the
Interest Account of the Special Tax Fund, respectively. At least five Business Days prior to each March 1 and
September 1, the Fiscal Agent will make the following transfers from the Special Tax Fund first to the Interest
Account and then to the Principal Account; provided, however, that to the extent that deposits have been made
in the Interest Account or the Principal Account from the proceeds of the sale of an issue of the 2020 Bonds or
any additional Series of Bonds, or otherwise, the transfer from the Special Tax Fund need not be made; and
provided, further, that, if amounts in the Special Tax Fund are inadequate to make the foregoing transfers, then
any deficiency shall be made up by an immediate transfer from the Reserve Account:
(i) To the Interest Account, an amount such that the balance in the Interest Account five
Business Days prior to each Interest Payment Date will be equal to the installment of interest due on the
19
2020 Bonds and any additional Series of Bonds on said Interest Payment Date and any installment of
interest due on a previous Interest Payment Date which remains unpaid. Moneys in the Interest Account
shall be used for the payment of interest on the 2020 Bonds and any additional Series of Bonds as the
same become due; and
(ii) To the Principal Account, an amount such that the balance in the Principal Account five
Business Days prior to September 1 of each year, commencing September 1, 2020, shall at least equal
the principal payment due on the 2020 Bonds and any additional Series of Bonds maturing on such
September 1 and any principal payment due on a previous September 1 which remains unpaid. Moneys
in the Principal Account will be used for the payment of the principal of such 2020 Bonds and any
additional Series of Bonds as the same become due at maturity.
Redemption Account of the Special Tax Fund
On each September 1 on which a Sinking Fund Payment is due, after the deposits have been made to the
Interest Account and the Principal Account of the Special Tax Fund, the Fiscal Agent will next transfer into the
Redemption Account of the Special Tax Fund from the Special Tax Fund the amount needed to make the
balance in the Redemption Account five Business Days prior to each September 1 equal to the Sinking Fund
Payment due on any Outstanding 2020 Bonds and any additional Series of Bonds on such September 1;
provided, however, that, if amounts in the Special Tax Fund are inadequate to make the foregoing transfers, then
any deficiency will be made up by an immediate transfer from the Reserve Account. Moneys so deposited in
the Redemption Account will be used and applied by the Fiscal Agent to call and redeem Term Bonds in
accordance with the Sinking Fund Payment schedule set forth in the Fiscal Agent Agreement for such Term
Bonds.
After making the deposits to the Interest Account and the Principal Account and to the Redemption
Account for Sinking Fund Payments then due, and in accordance with the provisions for optional redemption or
mandatory redemption from prepayments pursuant to the Fiscal Agent Agreement, the Fiscal Agent shall
transfer from the Special Tax Fund and deposit in the Redemption Account moneys available for such purposes
and sufficient to pay the interest, the principal and the premiums, if any, payable on the 2020 Bonds or any
additional Series of Bonds called for optional redemption or mandatory redemption from prepayments;
provided, however, that amounts in the Special Tax Fund may be applied to optionally redeem 2020 Bonds or
any additional Series of Bonds only if immediately following such redemption the amount in the Reserve
Account will equal the Reserve Requirement.
Reserve Account
As additional security for the 2020 Bonds and any additional Series of Bonds, the Fiscal Agent
Agreement provides for the establishment of the Reserve Account in the Special Tax Fund in the amount of the
Reserve Requirement. The "Reserve Requirement" as defined under the Fiscal Agent Agreement means as of
any calculation date, the lesser of (i) ten percent (10%) of the original proceeds of the 2020 Bonds and any
additional Series of Bonds, (ii) 80% of the maximum annual debt service on the 2020 Bonds and any additional
Series of Bonds, or (iii) 125% of the average annual debt service on the 2020 Bonds and any additional Series of
Bonds. As of the date of issuance of the 2020 Bonds, the Reserve Requirement will be fully funded in the
amount of $
Subject to the limits on the maximum annual Special Tax which may be levied within the District, the
District covenants to levy Special Taxes in an amount that is anticipated to be sufficient, in light of the other
intended uses of the Special Tax proceeds, to maintain the balance in the Reserve Account at the Reserve
Requirement. Amounts in the Reserve Account are to be applied to (i) pay debt service on the 2020 Bonds and
. Preliminary, subject to change.
20
any additional Series of Bonds, to the extent other monies are not available therefor; (ii) redeem the 2020 Bonds
or any additional Series of Bonds in whole or in part; and (iii) pay the final installments of principal and interest
due on the last outstanding Bonds. In the event of a prepayment of Special Taxes, under certain circumstances,
a portion of the Reserve Account will be added to the amount being prepaid and be applied to redeem Bonds;
provided, however, that no such transfer shall be made if it would result in the amount in the Reserve Account
being less than the Reserve Requirement. See APPENDIX C "SUMMARY CERTAIN PROVISIONS OF THE
FISCAL AGENT AGREEMENT - Reserve Account" herein.
If the amounts in the Interest Account, the Principal Account or the Redemption Account of the Special
Tax Fund are insufficient to pay the principal of, including Sinking Fund Payments, or interest on any 2020
Bonds or any additional Series of Bonds when due, the Fiscal Agent will withdraw from the Reserve Account
for deposit in the Interest Account, the Principal Account or the Redemption Account of the Special Tax Fund,
as applicable, moneys necessary for such purposes.
Whenever moneys are withdrawn from the Reserve Account, after making the required transfers under
the Fiscal Agent Agreement, the Fiscal Agent will transfer to the Reserve Account from available moneys in the
Special Tax Fund, or from any other legally available funds which the District elects to apply to such purpose,
the amount needed to restore the amount of such Reserve Account to the Reserve Requirement. Moneys in the
Special Tax Fund will be deemed available for transfer to the Reserve Account only if the Fiscal Agent
determines that such amounts will not be needed to make the deposits required to be made to the Interest
Account, the Principal Account or the Redemption Account of the Special Tax Fund. If amounts in the Special
Tax Fund or otherwise transferred to replenish the Reserve Account are inadequate to restore the Reserve
Account to the Reserve Requirement, then the District will include the amount necessary fully to restore the
Reserve Account to the Reserve Requirement in the next annual Special Tax levy to the extent of the maximum
permitted Special Tax rates.
The District may, but is not obligated to, advance funds from any source of legally available funds in
order to maintain the Reserve Account of the Special Tax Fund at the Reserve Requirement.
Administrative Expense Fund
Upon receipt of Special Taxes and prior to the transfer of Special Taxes to the Fiscal Agent for deposit
in the Special Tax Fund, the District shall deposit in the Administrative Expense Fund an amount equal to the
Administrative Expense Requirement for the Bond Year. The Fiscal Agent shall transfer from the Surplus Fund
to the Treasurer for deposit into the Administrative Expense Fund from time to time upon the Written Request
of the District additional amounts necessary to make timely payment of Administrative Expenses. Moneys in
the Administrative Expense Fund will be applied exclusively to pay Administrative Expenses, all as instructed
by the District pursuant to a Written Request of the District. Annually, the Treasurer will determine if there
exists a surplus of moneys in the Administrative Expense Fund not needed for the payment of Administrative
Expenses, and will transfer such surplus, if any, to the Fiscal Agent for deposit in the Surplus Fund to be used in
accordance with the Fiscal Agent Agreement.
Prepayment of Special Taxes
Under the RMA, the owner of a parcel may voluntarily prepay the Special Tax obligation for a parcel in
whole or in part. Any voluntary prepayment of Special Taxes will result in a special mandatory redemption of
the Bonds. See "THE 2020 BONDS —Redemption —Special Mandatory Redemption from Special Tax
Prepayments" and "SPECIAL RISK FACTORS — Potential Early Redemption From Special Tax Prepayments."
Covenant for Superior Court Foreclosure
In the event of a delinquency in the payment of any installment of Special Taxes, the District is
authorized by the Act to order institution of an action in the Superior Courts of the State to foreclose any lien
21
therefor. In such action, the real property subject to the Special Taxes may be sold at a judicial foreclosure sale.
The ability of the District to foreclose the lien of delinquent unpaid Special Taxes may be limited in certain
instances and may require prior consent of the property owner in the event the property is owned by or in
receivership of the Federal Deposit Insurance Corporation (the "FDIC") or other similar federal agencies. Such
judicial foreclosure proceedings are not mandatory. However, in the Fiscal Agent Agreement, the District has
covenanted for the benefit of the Owners of the 2020 Bonds that it (i) will commence judicial foreclosure
proceedings against all parcels owned by a property owner where the aggregate delinquent Special Taxes on
such parcels is greater than $25,000 by not later than 90 days following the date on which such Special Taxes
were due, (ii) will commence judicial foreclosure proceedings against all parcels with delinquent Special Taxes
not later than 90 days following the date on which such Special Taxes were due where it receives Special Taxes
in an amount which is less than 95% of the total Special Taxes due, and (iii) will diligently pursue such
foreclosure proceedings until the delinquent Special Taxes are paid. Commencement of any judicial foreclosure
proceedings includes the District's efforts to collect the delinquent Special Taxes by sending subsequent notice
of delinquency and a demand for immediate payment thereof
There could be a default or a delay in payments to the owners of the 2020 Bonds pending prosecution of
foreclosure proceedings and receipt by the District of foreclosure sale proceeds, if any, and subsequent transfer
of those proceeds constituting Special Taxes to the Special Tax Fund.
Under the Act, the City has the power to use a foreclosure judgment to purchase the subject property by
credit bid at foreclosure sale, in which event the City would have no obligation to pay such credit bid for 24
months.
Value -to -Lien Ratio
The 2020 Bonds are secured by Special Taxes which may include amounts realized upon foreclosure
sale of delinquent parcels. Therefore, the ability of the District to meet debt service on the 2020 Bonds may
depend on the ability of delinquent parcels to generate sufficient proceeds upon foreclosure sale to pay
delinquent Special Taxes. The appraised value of the parcels within the District is $124,540,000, as of
December 2, 2019, which is 6.90* times the aggregate principal amount of 2020 Bonds issued and 6.60* times
the aggregate total direct and overlapping debt within the District, including the 2020 Bonds.fi See "THE
DISTRICT — Value -to -Lien Ratios" and "- Direct and Overlapping Debt and Other Obligations" herein. See
also, "APPENDIX G —APPRAISAL REPORT.'
No Obligation of the City Upon Delinquency
The City is under no obligation to transfer any funds of the City into the Special Tax Fund or any other
funds or accounts under the Fiscal Agent Agreement for the payment of the principal of or interest on the 2020
Bonds if a delinquency occurs in the payment of any Special Taxes.
Although the Act authorizes the District to cause a foreclosure action to be commenced and diligently
prosecuted to completion, the Act does not impose on the District or the City any obligation to purchase or
acquire any parcel of property sold at a foreclosure sale if there is no other purchaser at such sale.
Notwithstanding the above, the City does have the ability to use the foreclosure judgment to purchase the
property by credit bid at a foreclosure sale, in which case the City would have no obligation to pay such credit
bid for 24 months.
. Preliminary, subject to change.
t Sulphur Springs CFD has a bond authorization of $19.5 million, of which approximately $8.2 million is estimated to be
secured by special taxes levied or to be levied on parcels within the District developed or designated for development of
apartment units. Bonds for Sulphur Springs CFD have not yet been issued and are not included in the direct and
overlapping debt. See "SECURITY FOR THE 2020 BONDS —Other Indebtedness and Obligations."
22
Other Indebtedness and Obligations
At the April 12, 2016 election, the qualified electors authorized the District to incur Bonds in an amount
not to exceed $45,000,000. The 2020 Bonds constitute the first series of the total authorization of $45,000,000
of Bonds. At a later time, additional Series of Bonds, up to an amount equal to $26,945,000*, or in such greater
amount as may be authorized by the qualified electors of the District, may be issued on a parity with the 2020
Bonds.
The properties in the District are subject to other existing authorized indebtedness payable from taxes
and assessments that may be levied. Existing authorized indebtedness is shown in Table 9 under "THE
DISTRICT — Direct and Overlapping Debt and Other Obligations" herein.
Additionally, the apartment units within the District are subject to a special tax levied and collected by
Sulphur Springs CFD. For Fiscal Year 2019-20, the assigned tax that was levied is $557.45 per apartment unit.
This special tax contains an annual escalator of 2% per year. The Sulphur Springs CFD is authorized to issue up
to $19.5 million of special tax bonds secured by the special tax revenues generated by such community facilities
district. Vista Canyon Ranch estimates that at full buildout of the Vista Canyon Project, the property within the
District will also bear approximately 42% of the total special taxes levied by Sulphur Springs CFD. The special
taxes levied by Sulphur Springs CFD are parity liens on any parcel of property taxed by both the District and
Sulphur Springs CFD.
The properties within the District could be subject to annual Special Taxes for Services for the District.
Pursuant to the RMA, the Special Tax for Services will only be levied in a Fiscal Year if it is determined that a
property owner association is not maintaining the Cooper Street Parking Facility (anticipated to be completed on
February 15, 2020) or the Vista Canyon Boulevard parking structure (to be completed in the future). Neither
parking structure has been completed and turned over to the City, and it is required that they will be maintained
by a property owner association. Therefore, the Special Tax for Services has not yet been levied and is not
expected to be levied. For the [2019-20] Fiscal Year, the Special Tax for Services rate was $120.50 per
developed multifamily unit, $0.21 and $0.54 per square foot for office/nonresidential and retail, respectively and
$54.18 per hotel room. This special tax contains an annual escalator tied to the consumer price index.
. Preliminary, subject to change.
23
PROPOSED LAND USE MAP OF VISTA CANYON MASTER PLANNED COMMUNITY
LAND USE
0 VISTACANYON Em Town
,enter - Retail & Office
Mg Town Center - Ra(M & Muftj•Famlily
HE Creafive Office Canopus
ME Retaw
an Howl
Mulb*arNy Rawdential
Neighborhood Resideflival
Malrolonk Slabon and Bus Transfer Stabw
IMI Parks
FfflM Pawng Siruciure,
M ftivf Rodarnadon Mant
[::] Open Space
UP,,ffl Rim Corridoe
24
VISTA CANYON MASTER PLANNED COMMUNITY
The following information regarding the status of development of the Vista Canyon Master Planned
Community has been provided by Vista Canyon Ranch and VC Lincoln. This information has been included
because it is considered relevant to an informed evaluation of the 2020 Bonds and the District. The City and the
District make no representation as to the accuracy or completeness of such information, nor have the City and
the District undertaken to verb or update such information, although they have reviewed such information in
conformity with their obligations under federal securities laws. The following information should not be
construed to suggest that the 2020 Bonds, or the Special Taxes that will be used to pay the 2020 Bonds, are
recourse obligations of the owners of any taxable property in the District.
Master Developer
The master developer of the Vista Canyon Master Planned Community ("Vista Canyon Project") is
Vista Canyon Ranch, LLC, a California limited liability company ("Vista Canyon Ranch"). Vista Canyon
Ranch is managed by JSJ Partners, LLC, a California limited liability company ("JSJ Partners"), and is owned
by 34 equity members, including JSJ Partners (5.70% membership interest) and an additional 33 individual
members (94.30% membership interest). Of the 34 total equity members, equity investment for nine members
exceeds $1,000,000 each.
JSJ Partners is comprised of (i) its 70% Member, JSB Development, Inc., a California corporation
("JSB Development"), with James S. Backer as its President, and (ii) its 30% Member, Valencia Realty
Partners, LLC, a California limited liability company ("Valencia Realty"), with Stephen Valenziano, as
Manager.
James "Jim" Backer, CEO of Vista Canyon Ranch, has over thirty-five years of experience in
commercial/industrial real estate with a background in development, sales and marketing. Prior to launching
JSB Development in 2000, Mr. Backer was an executive with The Newhall Land and Farming Company
("Newhall Land"), developers of the planned community of Valencia in California. There he gained experience
in office, mixed -use and industrial development, and comprehensive land planning. He had a major role in the
planning and development of the Valencia Commerce Center and Valencia's Town Center Drive. After leaving
Newhall Land, Mr. Backer developed a 670-acre business park in West Sacramento and the 240-acre Centre
Pointe Business Park within the City, the first significant employment center outside of Valencia to serve the
Santa Clarita Valley region. Under his leadership, JSB Development has developed 43 buildings totaling 1.1
million square feet. Mr. Backer is a licensed Real Estate Broker in the State of California and a member of the
Build -to -Suit Forum for the National Association of Industrial and Office Properties. Mr. Backer was founding
President, a Board member since inception, and current President of the SCV Education Foundation, a nonprofit
foundation dedicated to improving public education in the Santa Clarita Valley. After growing up in Omaha,
Nebraska, Mr. Backer graduated from Stanford University with a degree in History and earned his MBA from
the Anderson School of Business at UCLA.
Stephen "Steve" Valenziano, a partner in Vista Canyon Ranch, has over 37 years of diverse experience
in the real estate industry in brokerage, consulting and development. His career includes the design and
implementation of innovative organizational models, strategies and tools to align corporate goals, operations and
financial objectives. He has consulted for many major companies including Disney, United Healthcare, Capital
One, Delta Dental, General Motors, Microsoft and The Boeing Company. Prior to joining Vista Canyon Ranch,
Mr. Valenziano served as Managing Director for Jones Lange LaSalle (now known as JLL), an international real
estate services firm, within that company's Strategic Consulting group. A prominent figure in California's
commercial real estate industry, his career includes executive positions with Grubb & Ellis, Langdon Reider,
and Knight Frank Faulkner Baillieu. Mr. Valenziano was born in Baltimore, Maryland, and graduated from
Villanova University. He is an author and speaker on a variety of organizational, planning, and corporate real
estate issues.
25
The Entitlement and Permits Manager of Vista Canyon Ranch is Glenn Adamick, who has 29 years of
planning and development experience. He started his career with the City in the Community Development
Department processing large residential, commercial, and industrial development projects and later moved to the
City Manager's Department (Economic Development Division) where he was the point person on the creation
of the Newhall Redevelopment Project Area and other economic development projects. In 1999, Mr. Adamick
accepted a position as Vice President with national homebuilder Beazer Homes and was responsible for land
acquisition and forward planning for projects north of downtown Los Angeles. He joined Newhall Land in late
2000. As Vice President, Forward Planning and Entitlements, Mr. Adamick was charged with completing
entitlements for remaining residential and commercial/industrial projects within the Valencia Master Plan
including Valencia Commerce Center, West Creek, River Village, and Soledad Village. He also had lead
entitlement responsibility for the implementation of the approved Newhall Ranch Specific Plan. He grew up in
the City and graduated from California State University Northridge with a degree in Urban Studies/Urban
Planning.
The Development Entities
Vista Canyon Ranch began purchasing the property comprising the Vista Canyon Project in 2006. Vista
Canyon Ranch's development plan is to sell parcels within the Vista Canyon Project to third -party developers
and/or develop the remaining portions of the project in a partnership with financial or development partners.
Vista Canyon Phase I, LLC, a Delaware limited liability company ("Vista Canyon Phase I"), which is
managed by JSJ Partners, is wholly owned by Vista Canyon Ranch. Vista Canyon Phase I is the owner of
various parcels in the District, as described herein.
VC Lincoln 1, LLC, a Delaware limited liability company ("VC Lincoln"), was created to develop a
portion of the property in the District as office/retail buildings, as described herein. VC Lincoln is owned 100%
by Vista Canyon Phase I and is managed by JSJ Partners.
To date, Vista Canyon Ranch has sold property within the District to Jefferson Vista Canyon, LLC, a
Delaware limited liability company ("Jefferson"), for the development of a 480-unit apartment complex, as
described herein. Jefferson is part of the affiliated group of JPI companies ("JPI"). JPI is a privately -held
developer and builder of Class A multi -family residential projects. Jefferson is unrelated to Vista Canyon
Ranch and its subsidiaries.
Vista Canyon Ranch has also sold property within the Vista Canyon Project but outside of the District to
KB Home. On March 28, 2019, KB Home closed escrow on four parcels in Planning Area 3 that are proposed
for development of 154 single-family detached condominiums. In the first quarter of 2020, KB Home is
scheduled to close on property to develop an additional 91 single-family detached condominiums (for a total of
245 single family detached condominiums). Model homes are nearing completion, with a grand opening planned
in January 2020. The KB Home property is not subject to the special taxes for the District.
Entitlements and Specific Plan
The Vista Canyon Project is a 185-acre project generally located in the northeastern section of the City,
south of the 14 Freeway and the Santa Clara River, at the terminus of Lost Canyon Road, north of the existing
Metrolink tracks. When complete, the Vista Canyon Project will include 1,100 residential units (including 855
apartment units and 245 single family units), up to 950,000 square feet of commercial area which will consist of
office, retail and service uses, a water reclamation plant, an 11-acre City park, four parking structures, and the
new Metrolink Station with the Bus Station. Access to the Vista Canyon Project is currently available from Lost
Canyon Road and Humphries, but will also include Vista Canyon Boulevard by way of the to -be -completed
Vista Canyon Bridge.
26
The Vista Canyon Project was approved by the Santa Clarita City Council on May 10, 2011.
Entitlements approved in conjunction with the project include: Annexation to the City of Santa Clarita; a Zone
Change to SP (Specific Plan); a Specific Plan; Tentative Tract Map; a Conditional Use Permit; and an Oak Tree
Permit.
The most critical of the above entitlements was the approval of the Vista Canyon Specific Plan. The
Specific Plan has been prepared pursuant to the provisions of the California Government Code, Title 7, Division
1, Chapter 3, Article 8, sections 65450 through 65457. The Specific Plan is regulatory in nature and serves as
the Zoning Code for the project site. Permitted uses, development standards, setbacks, height limits, and
landscape requirements are all contained within the Specific Plan. The Specific Plan also outlines the
development process for implementation of the Vista Canyon Project. Development plans, tract maps and other
entitlement requests processed on the project site must be consistent with the Specific Plan.
The Specific Plan divides the project site into three Planning Areas.
• Planning Area 1 includes approximately 13.5 acres in part of Final Tract Map 69164-01 (as
defined herein). Planning Area 1 can be developed with up to 480 residential units (being developed by
Jefferson) and the recently completed water reclamation plant. All of Planning Area 1 is within the District.
• Planning Area 2 consisting of approximately 30 acres within the remainder of Final Tract Map
69164-01, in part of Final Tract Map 69164-02 (as defined herein), and in Tentative Tract Map 69164 (as
defined herein). Planning Area 2 can be developed with up to 950,000 square feet of commercial uses
(hospitality, office, retail, etc.) and 375 residential units. Planning Area 2 also includes the City Transit Center
including the Bus Station and the Metrolink Station, both of which are exempt from the levy of the Special Tax
under the RMA. All of Planning Area 2 is within the District.
• Planning Area 3 consists of approximately 41 acres within the remainder of Final Tract Map
69164-02. Planning Area 3 includes Oak Park (an 11-acre community park) and can be developed with up to
245 residential units. KB Home is presently developing Planning Area 3 with 154 single-family residential
condominiums and is also expected to develop an additional 91 single-family residential condominium units.
Planning Area 3 is not located within the District and does not serve as security for the 2020 Bonds; any
discussion of Planning Area 3 is for informational purposes only.
The Specific Plan provides a great deal of flexibility to the project developer primarily in Planning Area
2. The developer has the right to move uses, adjust building footprints, and modify street sections within
Planning Area 2.
Status of Infrastructure in the District
The Vista Canyon Project is subject to various conditions of development, most of which are required
contemporaneously with the construction of the various phases. There are a few requirements that must be met
before building permits or occupancy permits are granted, as follows:
A. Vista Canyon Bridge. Prior to the issuance of the 3001h building permit or equivalent trip
generation, Vista Canyon Ranch must submit design plans for the Vista Canyon Bridge to the City Engineer.
Prior to the 11000 ' residential occupancy or equivalent trip generation, the Vista Canyon Bridge must be
completed. Vista Canyon Ranch submitted the plans in a timely manner. However, the City is now responsible
to construct the bridge itself. Vista Canyon Ranch has been informed that the $20 million bridge project is fully
funded, and it is anticipated that the City will begin construction in May/June 2020. This project is the primary
access to the Vista Canyon Town Center including the Vista Canyon Transportation Center (Bus Station and
Metrolink Station). Design of this bridge is nearing completion and this project is anticipated to be complete in
2021, which is prior to the projected 1,OOO1h residential occupancy or equivalent trip generation.
27
B. Transit Center. Prior to the receipt of a certificate of occupancy for more than 250,000 square feet
of commercial floor area in the Vista Canyon Project, the first phase of the Transit Center must be in place and
operational. The City is constructing the Transit Center. The approximately $7.8 million Bus Station will be
located within Planning Area 2 adjacent to the Vista Canyon Metrolink Station. Vista Canyon Ranch has been
informed that this transit station project is fully funded, and the City will begin land development activities in
January 2020. This bus station project is projected to be operational in 2021, which is anticipated to be before
there is 250,000 square feet of commercial floor area.
The City is also constructing the Vista Canyon Metrolink Station. This transit project is estimated to
cost approximately $37 million, and Vista Canyon Ranch has been informed that most of the funding has
already been obtained. The transit project is fully designed (with design costs being paid for by the City and
Metro). Construction of this transit project is anticipated to begin in mid-2020 with completion anticipated in
mid-2022.
C. Parking. The Specific Plan contains a shared parking program with the City. On a phase by phase
basis, the Specific Plan requires sufficient parking (surface and parking structures) to be in place before
occupancy permits are granted for that phase. Vista Canyon Ranch believes that the combination of surface
parking and the Cooper Street Parking Facility is sufficient to satisfy all of Zone 1 of the District and
approximately 60,000 square feet of Zone 2 of the District (the "First Phase Property"). Vista Canyon Ranch
believes that the special taxes that may be levied on Developed Property upon the issuance of the remaining
building permits in the First Phase Property will be more than sufficient to pay the debt service on the 2020
Bonds.
As Vista Canyon Ranch develops additional property in Zone 2, the following two parking facilities will
be required as development progresses:
(i) Vista Canyon Boulevard Parking Garage. The publicly -owned Vista Canyon Boulevard Parking
Garage (herein, "Vista Canyon Boulevard Parking Garage") which is anticipated to be constructed on Lot 13 of
Tract Map No. 69164 and comprises approximately 500 spaces at a cost of approximately $11.75 million to
construct; this garage is anticipated to be financed with an additional series of Bonds issued by the District; and
(ii) Lot 16 Parking Structure. 600 additional spaces to be built on Lot 16 of Tract Map No. 69164 ("Lot
16 Parking Structure"). Currently, it is anticipated that approximately 50% of the spaces on the Lot 16 Parking
Structure would be purchased by the Corporate Office Campus developer for its exclusive use during daytime
hours, with the remaining spaces open to the public and funded from proceeds of another series of Bonds by the
District. Vista Canyon Ranch may build the Lot 16 Parking Structure, or may negotiate its construction with the
private developer, or some combination thereof The Lot 16 Parking Structure is anticipated to cost
approximately $14.1 million. This garage is anticipated to be financed in part with an additional series of Bonds
issued by the District.
The District has a total bond authorization of $45 million. Following the issuance of the 2020 Bonds,
the remaining authorization is expected to be $26,945,000.* Additional bonds are expected to be issued subject
to future approval by the District and the terms and conditions of the additional bonds test herein. See "THE
2020 BONDS - Additional Series of Bonds."
D. Oak Park. Prior to the 1501h certificate of occupancy in Planning Area 3, Vista Canyon Ranch must
complete construction of Oak Park (now called Vista Canyon Park), the River Education Center (which is a
recreation building on the Oak Park site), and the Santa Clara River Trail (herein, the "Oak Park
Improvements"). In any event, the Oak Park Improvements shall be completed by the 600'h residential
occupancy in the Vista Canyon Project (which includes the 480 Complex in the District and the KB Home
development outside Zone 1 and Zone 2 of the District). The Oak Park site plan has been approved (which
. Preliminary, subject to change.
28
includes Oak Park and the River Education Center), and working drawings have been prepared for the River
Education Center (including trash enclosure and shade structures). Construction of the park commenced in
December 2019 and turnover to the City is anticipated by October 2020, which Vista Canyon Ranch believes
will be prior to the 600'h occupancy. The estimated cost of the Oak Park Improvements (which includes
accessory trail improvements) is approximately $4 million.
E. Sand Canyon Trail Payments. A total of $300,000 must be paid to the City prior to the 150th
certificate of occupancy in Planning Area 3. One-third of this amount has already been paid, and Vista Canyon
Ranch expects to comply with this requirement in a timely manner. This condition does not impact the
development of property in the District.
F. Connecting Trails. Prior to the 150'h certificate of occupancy in Planning Area 3, construction of a
trail connecting the Santa Clara River Trail to Sand Canyon Road must be complete. As of December 1, 2019,
the trail has been designed, and Vista Canyon Ranch expects to comply with this requirement in a timely
manner. This condition does not impact the development of property in the District.
As of January 15, 2020, Vista Canyon Ranch has expended over $47 million on grading and
infrastructure improvements for the Vista Canyon Project, approximately $14.8 million on the Cooper Street
Parking Facility, and approximately $15 million on land acquisition. As of January 15, 2020, Vista Canyon
Ranch estimates that (i) the remaining cost for infrastructure improvements required to complete the First Phase
Property (the Oak Park Improvements, various road improvements, and a community garden) is approximately
$6.5 million (the "First Phase Costs"), (ii) the remaining cost for infrastructure improvements required to
develop the remaining portion of Zone 2, as well as the costs of the Vista Canyon Boulevard Parking Garage
and the Lot 16 Parking Structure to be approximately $34.25 million (herein, the "Remaining Zone 2 Costs").
Vista Canyon Ranch anticipates expending the First Phase Costs over the next 12 months, while the Remaining
Zone 2 Costs will be spent as needed when development of the remainder of Zone 2 is undertaken. The
estimated costs are for improvements only, and do not include building fees payable to the City during the
course of development.
Financing Plan
To date, Vista Canyon Ranch has financed the development of the Vista Canyon Project through a
series of loans, two of which have been paid off in full. In October 2015, Vista Canyon Ranch secured a loan
with Acres Capital for land development work to create super pads within Phase I and basic infrastructure. This
loan was paid off in full on November 22, 2017 at the closing of the sale of property to Jefferson. In October
2017, Vista Canyon Ranch secured a loan with Standard Management Corporation to create super pads and
complete infrastructure in Planning Area 3 of the project site for detached condominiums. This loan was paid
off in full on March 28, 2019 with the initial sale to KB Home.
VC Lincoln has secured a loan in the aggregate amount of $22 million (the "EB-5 Loan") from CMB
Infrastructure Investment Group 59, LP, a Texas limited partnership (the "CMB Lender"), an EB-5 Regional
Center, for the construction of the completed office/retail building (as discussed below), the Water Reclamation
Plant, and soft costs associated with the Cooper Street Parking Facility. The loan agreement with the CMB
Lender was dated March 2, 2017, and has been amended several times. The EB-5 Loan has a note rate of 7.5%,
and principal is due 6 years following the final advance (which was in November 2019). Annual interest is
payable on July 1 of each year. The EB-5 Loan is guaranteed by Vista Canyon Ranch. The EB-5 Loan is secured
by a deed of trust on Lots 6, 9, 10, and 13 of Final Tract Map 69164-01. Among other requirements, the EB-5
Loan requires that the "Improvements" be completed by a date certain. The "Improvements" include the office
building located on Lot 10 of Final Tract Map 69164-01, the Water Reclamation Plant, the Cooper Street
Parking Facility, and various other improvements. As of January 15, 2020, the office building is approximately
98% completed, with remaining surrounding hardscape/landscaping being currently installed, the Water
Reclamation Plant is 100% completed, the Cooper Street Parking Facility will be completed in February, 2020,
and the other improvements have been completed. The EB-5 Loan required that these Improvements be
29
completed by September 30, 2019. On January , 2020, the CMB Lender and VC Lincoln amended the EB-5
Loan to extend the completion date for the "Improvements" to March 31, 2020. VC Lincoln anticipates that the
EB-5 Loan will be paid back through the re -financing of the completed office/retail building once the asset is
fully leased.
In October 2009, Vista Canyon Ranch secured a loan initially from five investors (the "Lender Bridge
Loan"). The Lender Bridge Loan was increased over time, along with the number of investors (now
approximately 18). Principal and accrued interest on the Lender Bridge Loan is due July 31, 2022, and bears
interest at various rates that average approximately 10.5%. The Lender Bridge Loan is secured by a deed of trust
on all of the following lots: (i) a first lien on Lot 14 of Final Tract Map No. 69164-01; and (ii) a subordinated
lien on Lot 7 (the Cooper Street Parking Facility) and the adjacent Lot 11 of Final Tract Map No. 69164-01, and
all of the property in Tentative Tract Map No. 69164. The lien on the property described in (n) above is
subordinate to the herein -defined Torrey Pines Loan. Most of the investors in the Lender Bridge Loan (herein,
the "Subordinated Lenders") also have an ownership interest in Vista Canyon Ranch. The Lender Bridge Loan
was partially repaid from a portion of the Torrey Pines Loan, and the remainder is anticipated to be repaid with
the extension of the Torrey Pines Loan (see "DEVELOPMENT WITHIN THE DISTRICT - Final Tract Map
No. 69164-01 (18 Lots) Vista Canyon I Financing Plan" below), future partnerships, and/or future land
sales. As of January 15, 2020, the outstanding balance on the Lender Bridge Loan is approximately $20 million
(principal and accrued interest).
To fund the remaining First Phase Costs in the District, (currently estimated to be $14.9 million), and to
ultimately fund the Remaining Zone 2 Costs, Vista Canyon Ranch intends to use one or more of the following
sources of funds (herein, the "Project Sources"):
• Equity Package: Vista Canyon Ranch is finalizing an offering package to the equity markets to
obtain a partner or partners to build out the remaining portions of the project. This offer package
will be out in the first quarter of 2020.
• Loans: Vista Canyon Ranch, or its subsidiaries, may borrow additional funds from one or more
lending institutions or its existing investors/borrowers.
• Further Land Sales: Subsidiaries of Vista Canyon Ranch may determine to sell one or more of
its lots to other builders, and use the proceeds from the sale to complete the project.
• Proceeds from KB Home Sale: Vista Canyon Ranch may use the proceeds from further sales
to KB Home of property in Planning Area 3 to fund the development. Vista Canyon Ranch
anticipates that the land for KB Home to construct the remaining 91 units will close in April
2020.
• Profit Participation: Vista Canyon Ranch may apply the proceeds of its profit participating
with both KB Home and Jefferson to fund the development.
• Capital Call: If necessary, Vista Canyon Ranch may make a capital call on its owners to fund
the development.
• Additional Series of District Bonds: Vista Canyon Ranch anticipates the issuance of up to two
series of additional District Bonds to finance additional public parking and related public
improvements that may be required.
While Vista Canyon Ranch anticipates that one or more of the Project Sources described above
will be available to finance the remaining First Phase Costs, Vista Canyon Ranch does not currently have
a dedicated source in place to pay for the remaining First Phase Costs required to complete the
30
development of the First Phase Property in the District. No assurances can be made that Vista Canyon
Ranch will be able to obtain financing for the remaining First Phase Costs.
Environmental
The City certified the Final Environmental Impact Report for the Vista Canyon Master Planned
Community (the "EIR") on April 26, 2011. The EIR analyzed the potential environmental effects from all
discretionary actions necessary to develop the Vista Canyon Project. All required permits from regulatory
agencies have been acquired to complete the development within the District. All appeal periods with respect to
such approvals have expired. See "SPECIAL RISK FACTORS — Failure to Develop Undeveloped Properties,"
and " - Endangered and Threatened Species."
School Mitigation
The Vista Canyon Project is within the William S. Hart Union High School District served by La Mesa
Junior High and Golden Valley High School, and the Sulphur Springs Union School District served by Sulphur
Springs Community School.
Developers of non-residential units within the District pay an indexed school mitigation fees at the time
of pulling building permits allocated among Sulfur Springs Union School District and William S. Hart Union
High School District.
DEVELOPMENT WITHIN THE DISTRICT
Only Planning Area 1 and Planning Area 2 of the Vista Canyon Project are included within the
boundaries of the District. These two planning areas consist of three tract maps, described as follows:
Final Tract Map No. 69164-01: This tract map consists of 18 lots over 29.13 acres and was
recorded on April 13, 2017 as instrument number 20170412197 in Book 1396 of Maps of Los
Angeles County at Pages 40-48.
Final Tract Map No. 69164-02: This tract map consists of 19 lots over 45.38 acres (only four of
which are in the District) and was recorded on December 24, 2018 as instrument number
20181303888 in Book 1410 of Maps of Los Angeles County at Pages 29-38.
• Tentative Tract Map No. 69164: This tentative tract map consists of 21 lots over 32.84 acres.
This map is not yet final. Vista Canyon Phase I anticipates that this map will be recorded in the
first quarter of 2020.
As used in Table 1 and elsewhere in this section of the Official Statement, references to "Lot" numbers
are references to the un-circled lot numbers shown on the three maps set forth on the following pages.
31
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32
TRAC 'i NO, 169164-02
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34
TABLE 1
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
SUMMARY OF TAXABLE PARCELS IN DISTRICT
(as of January 15, 2020)
Tract Map/Lots
Owner
CFD Tax
Projected
Development Status
Zone
Development
Final Tract Map 69164-01 (See Note 1)
Lots 3, 4, and 5
Jefferson
1
480 Apartments
Framing underway with first
occupancies expected in April 2020
Lot 6
VC Lincoln
1
Office/Retail
Graded pad with access and utilities
stubbed to lot; building permit
expected in Ql of 2021
Lot 9
VC Lincoln
1
Office/Retail
Graded pad with access and utilities
stubbed to lot; building permit
expected in Ql 2022
Lot 10
VC Lincoln
1
3-Story
Construction 98% complete;
Office/Retail
certificate of occupancy expected by
February 1, 2020
Lot 11
Vista Canyon Phase I
1
Office/Retail
Graded pad with access and utilities
stubbed to lot; building permit
expected in Q3 2020
Lot 12
Vista Canyon Phase I
1
Apartments (39
Graded pad with access and utilities
units)
stubbed to lot; building permit
expected in Q3 2020
Lot 13
VC Lincoln
2
Office/Retail
Graded pad with access and utilities
stubbed to lot; building permit
expected in Ql of 2021
Lot 14
Vista Canyon Phase I
2
Hotel (200 room)
Graded pad
Final Tract Map 69164-02 (See Note 2)
Lots 1, 2, 3, and 4
Vista Canyon Phase I
2
Apartments (299
Rough graded with access and utilities
units)
stubbed to the lot
Tentative Tract Map 69164
Projected Lots 1, 3,
Vista Canyon Phase I
2
Commercial,
Graded pad
6, 7, 10, 11, 12, 14,
Office, Retail,
15, and 17
Apartments
Projected Lots 2, 8,
Vista Canyon Phase I
2
Plaza, Town
Graded pad (Lots 2, 8, and 9); Rough
9, and 21
Greens, Access
graded (Lot 21); expected to be
Driveway (to be
exempt from the Special Taxes
POA Property)
Projected Lots 4 and
Vista Canyon Phase I
2
Metrolink Parking
Graded pad with access and utilities
5
Structure and Bus
stubbed to lot; expected to be exempt
Transfer Station
from the Special Taxes
(to be City Owned)
Projected Lots 13
Vista Canyon Phase I
2
Vista Canyon
Graded pad; expected to be exempt
and 16
Parking Structures
from the Special Taxes
(to be City owned)
Projected Lots 18,
Vista Canyon Phase I
2
Corporate Office
Rough graded
19, and 20
Campus (6-story
buildings)
Note 1: Lots 1 (Reclamation Plant), 2 (POA Property), 7 (Cooper Street Parking Facility), and 8 (Community Garden) are not described because it is
anticipated that these parcels will be exempt from the District taxation.
Note 2: Lots 5 through 19 of Tract Map No. 69164-02 are not included in either Tax Zone 1 or Tax Zone 2 of the District and are primarily roadways and
single-family residential units being developed by KB Home.
Source: Vista Canyon Ranch.
35
The ownership and development of the property within each of the above -described maps is set forth
below.
Final Tract Map No. 69164-01 (18 Lots)
Final Tract Map No. 69164-01 consists of 18 lots. The ownership of each of the lots is set forth below:
City of Santa Clarita
The City owns Lot 1. Lot 1 is the completed Water Reclamation Plant and is exempt from taxation by
the District.
Jefferson Vista Canyon, LLC
Ownership. Jefferson owns lots 3-5, which is approximately 13.159 acres. Jefferson is part of
the affiliated group of JPI companies. Headquartered in Irving, Texas, JPI also has an office in
California. JPI's executive leadership team has an average of 25 years of comprehensive experience in
multifamily developments, ranging from low -density garden apartments to wrap and podium projects.
Since 2010, JPI has developed 46 projects totaling approximately 15,800 dwelling units valued at
approximately $4.1 billion in markets that include Los Angeles, Orange and San Diego counties in
California, Phoenix, Dallas, Austin, Houston, Denver, New York and select Northeast markets.
CONCEPTUAL DESIGN OF JEFFERSON VISTA CANYON APARTMENTS
Development Plan. Jefferson is constructing a 480-unit luxury apartment complex, comprising studio
and one-, two- and three -bedroom apartment layouts (the "480 Complex"). The 480 Complex, designed
by Architects Orange, based in Orange, California, will consist of multiple buildings, a pool/clubhouse,
and required parking. As of December 1, 2019, the 480 Complex is in the framing stage. All building
permits for the construction of the 480 Complex have been received. The first building certificate of
occupancy is expected in April 2020, with final occupancy anticipated for September 2021.
The 480 Complex at completion is expected to consist of 17 separate apartment buildings ranging from
2 to 64 individual apartment units each, a recreation and clubhouse building, 2 swimming pools and
other ancillary facilities. The apartment units will include one -bedroom units with an average size of
36
738 square feet, two -bedroom units with an average size of 1,109 square feet and three -bedroom units
with an average size of 1,304 square feet.
Financing Plan. Jefferson and its affiliates have arranged for up to approximately $166,489,000 in
financing from third parties to facilitate the acquisition, development, construction, and operation of the
480 Complex. Approximately $113,258,829 is expected to be funded from a senior construction
financing facility arranged by Comerica Bank. Approximately $54,664,000 is expected to be funded
from a mezzanine financing facility arranged by affiliates of Colony Capital. Each of the Comerica
Bank and Colony Capital facilities contain certain customary rights and remedies benefitting each,
including, but not limited to, the ability to foreclose on the interests and assets of the Borrower in the
event of certain defaults occurring. The Colony Capital facility is generally subordinate to the interests
of the Comerica Bank facility. The Comerica Bank loan is secured by a Deed of Trust on Lots 3-5 in
Final Tract Map No. 69164-01.
VC Lincoln
Ownership. Lots 6, 9, 10, and 13 of Final Tract Map No. 69164-01 are owned by VC Lincoln. The sole
member of VC Lincoln is Vista Canyon Phase I. The sole member of Vista Canyon Phase I is Vista
Canyon Ranch, the master developer of the Vista Canyon Project. Both Vista Canyon Ranch and Vista
Canyon Phase I are managed by JSJ Partners.
Development Plan. VC Lincoln intends to construct office/retail buildings on these four lots. The
current plans for each lot are as follows:
Lot 10: VC Lincoln is currently constructing in Zone 1 a three-story mixed -use building
designed by the world-renowned architecture firm, Gensler, with 19,859 square feet of ground
floor retail space and 39,718 square feet of second and third floor office space. As of January
15, 2020, the building is substantially complete with tenant improvements underway.
Remaining work to fully complete the building includes the surrounding landscaping and
hardscape improvements which are underway. The office and retail space are presently being
marketed by CBRE (office space) and NAI Capital (retail space), with ground floor retail space
asking $36 to $42 per sq. ft. per year, triple net, and the second and third floor office space
asking $24 per sq. ft. per year, triple net. As of January 15, 2020, (i) for the ground floor retail,
1,574 square feet been leased, and there is a Letter of Intent to lease an additional 5,615 square
feet, and (ii) for the second floor office space, separate leases for 1,341 square feet and 2,156
square feet have been signed, with negotiations on an additional 3,166 square feet ongoing. The
building has an expected opening of February 1, 2020.
VC LINCOLN I, LLC
MIXED -USE 3
STORY BUILDING
(April 2019)
37
• Lot 6: The current plan for this parcel in Zone 1 is to develop it with a three-story 63,900 square
foot office/retail building. Up to 21,300 square feet of retail on the ground floor could be
developed, with the remaining 42,600 square feet for office use. As of January 15, 2020, the lot
is a graded pad with access and utilities stubbed to the lot, design is underway but construction
of the office/retail building has not commenced. A building permit is expected in Q 1 of 2021.
Lot 9: The current plan for this parcel in Zone 1 is to develop it with a single -story 18,500
square foot retail building. As of January 15, 2020, the lot is a graded pad with access and
utilities stubbed to the lot, but neither design nor construction of the retail building has
commenced. A building permit is expected in Q 1 of 2022.
Lot 13: The current plan for this parcel in Zone 2 is to develop it with a three-story 54,200
square foot office/retail building. Up to 21,400 square feet of retail on the ground floor could be
developed, with the remaining 32,800 square feet for office use. As of January 15, 2020, the lot
is a graded pad with access and utilities stubbed to the lot, design is underway but construction
of the office/retail building has not commenced. A building permit is expected in Q 1 of 2021.
Financing Plan. Vista Canyon Ranch and its subsidiary VC Lincoln do not currently have financing in
place for the development of Lots 6, 9 and 13 and intend to use one or more of the Project Sources to
buildout the remaining portions of the project including the above referenced lots. The EB-5 Loan is
secured by a deed of trust on Lots 6, 9, 10, and 13 of Final Tract Map 69164-01.
Vista Canvon Phase I
Ownership. Lots 2, 7, 8, 11, 12, 14, 15, 16, 17, and 18 of Final Tract Map No. 69164-01 are owned by
Vista Canyon Phase I.
Development Plan. Vista Canyon Phase I is developing these lots as follows
• Lot 2: This lot is located along Lost Canyon Road and will developed with landscaping and
irrigation improvements. Lot 2 will ultimately be conveyed to the property owner's association
and will not be taxable.
• Lot 7: Lot 7 is the location of the Cooper Street Parking Facility. The parking garage is near
completion, with an expected completion date of February 15, 2020. The parking garage will
be conveyed to the City upon issuance of a certificate of occupancy and will not be taxable.
• Lot 8: Lot 8 consists of the community garden and, upon completion, will be conveyed to the
property owner association and will not be taxable.
• Lot 11: The current plan for this parcel in Zone 1 is to develop it with a three-story, 59,000
square foot office/retail building. Up to 19,600 square feet of retail on the ground floor could be
developed, with the remaining 39,400 square feet for office use. As of January 15, 2020, the lot
is a graded pad with access and utilities stubbed to the lot. Design is complete and working
drawings are being prepared for submittal to the City for building permit. A building permit is
expected in Q3 of 2020.
Lot 12: The current plan for this parcel in Zone 1 is to develop it with a four-story, 39-unit
apartment building. As of January 15, 2020, the lot is a graded pad with access and utilities
stubbed to the lot, and design is underway but construction of the apartment building has not
commenced. A building permit is expected in Q3 of 2020.
38
Lot 14: The current plan for this parcel in Zone 2 is to develop it with a 200-room hotel. As of
January 15, 2020, the lot has a graded pad, but neither design nor construction of the hotel has
commenced.
Lots 15, 16, 17, and 18: These lots consist of roadway and frontage improvements that will be
conveyed to the property owner's association upon completion. These lots will not be taxable.
Financing Plan. The costs to construct the parking garage is being financed by a loan (the "Torrey Pines
Loan") from Western Alliance Bank (the "Bank"). On August 26, 2019, Vista Canyon Phase I and the
Bank entered into a Construction Loan Agreement whereby the Bank would lend $19.1 million to Vista
Canyon Phase I for the purpose of constructing the parking garage and paying a portion of the
Subordinated Noteholders. The Torrey Pines Loan is secured by a deed of trust on all of the following
lots: Lot 7 (the Cooper Street Parking Facility lot) and the adjacent Lot 11 in Final Tract Map No.
69164-01; Lots 1, 2, 3, and 4 of Final Tract Map No. 69164-02 (owned by Vista Canyon Phase I); and
all of Tentative Tract Map No. 69164. The Torrey Pines Loan is also secured by additional property
outside of the District, including 32.25 acres north of the District.
The Torrey Pines Loan bears interest at the Wall Street Journal's prime rate plus 1%, with a floor of
6.5%. The Torrey Pines Loan matures on August 26, 2020 but is subject to extension. If the Cooper
Street Parking Facility is completed and Vista Canyon Phase I pays down the portion of the loan used
for the parking garage (anticipated to be paid with the proceeds of the 2020 Bonds and as evidenced by
the reconveyance of the deed of trust on the parking garage site), Vista Canyon Phase I may request an
optional loan increase (equal to the lesser of (i) 50% of the as -is value of the remaining property subject
to the Deed of Trust, less approximately $3.85 million or (ii) $11,900,000) in order to make additional
payments to the Subordinated Noteholders and extend the maturity date of the Torrey Pines Loan to
August 26, 2021. Various conditions must be met in order to receive the increase and extension, and, if
those conditions are met and the increase and extension are granted by the Bank, the interest rate will
increase to the greater of 7.00% or 1.5% over prime. This revised maturity date is also subject to an
extension to August 26, 2022 if various conditions are met, including the paydown on the loan of $5
million and the payment of an extension fee to the Bank.
The Torrey Pines Loan is guaranteed on a limited basis by James Backer, Steve Valenziano and the
Valenziano Trust.
In addition, Lot 14 is encumbered, on a first lien basis, by the lien of a deed of trust securing the Lender
Bridge Loan and Lot 7 is encumbered, on a subordinated basis, by the lien of a deed of trust securing the
Lender Bridge Loan.
Vista Canyon Ranch and its subsidiary Vista Canyon Phase I do not currently have financing in place
for the development of Lots 11, 12 and 14 and intend to use one or more of the Project Sources to
buildout the remaining portions of the project including the above referenced lots.
Final Tract Map No. 69164-02 (4 Taxable Lots)
Final Tract Map No. 69164-02 consists of 19 lots, however only 4 of the lots are in the District.
Vista Canyon Phase I
Ownership. Vista Canyon Phase I owns lots 1, 2, 3, and 4 of Final Tract Map No. 69164-02.
Development Plan. Vista Canyon Phase I currently intends to develop 299 apartment units on these lots
in Zone 2. The apartments have not been fully designed, and no building permits have been pulled.
These four lots are currently rough graded with access and utilities stubbed to the lots. While Vista
39
Canyon Phase I anticipates the construction of apartments on these lots, the Specific Plan has great
flexibility to allow other authorized uses.
Financing Plan. These four lots serve as security for the Torrey Pines Loan and is subject to the deed of
trust securing such loan. This property is also subject to the lien of the deed of trust securing the Lender
Bridge Loan on a subordinated basis. Vista Canyon Ranch and its subsidiary Vista Canyon Phase I do
not currently have financing in place for the development of Lots 1, 2, 3 and 4 and intend to use one or
more of the Project Sources to buildout the remaining portions of the project including the above
referenced lots. No assurances can be made that Vista Canyon Ranch will be able to obtain financing for
the remaining infrastructure.
Tentative Tract Map No. 69164 (1 Taxable Lot)
Tentative Tract Map No. 69164 is anticipated to be finalized and recorded in the first quarter of 2020.
When recorded, Tentative Tract Map No. 69164 will create 21 lots, all of which will be in Zone 2 of the District.
The ownership of each of these future lots is set forth below:
Vista Canyon Phase I
Ownership. Vista Canyon Phase I owns the property that comprises Tentative Tract Map No. 69164
Development Plan. This tract is anticipated to be developed with the remaining commercial space,
parking structures, and remaining residential units (approximately 37 residential units). All parcels are
rough graded, and some have access and utilities stubbed to the lot. Construction is anticipated to begin
early 2021, with development and build -out through 2026.
Financing Plan. This property serves as security for the Torrey Pines Loan and is subject to the deed of
trust securing such loan. This property is also subject to the lien of the deed of trust securing the Lender
Bridge Loan on a subordinated basis. Vista Canyon Ranch and its subsidiary Vista Canyon Phase I do
not currently have financing in place for the development of Tentative Tract Map No. 69164 and intend
to use one or more of the Project Sources to buildout the remaining portions of the project including the
above referenced lots. No assurances can be made that Vista Canyon Ranch will be able to obtain
financing for the remaining infrastructure.
THE DISTRICT
General
On February 23, 2016, the City Council adopted a Resolution of Intention to form a community
facilities district under the Act, to levy a special tax and to incur bonded indebtedness for the purpose of
financing certain improvements. After conducting a noticed public hearing, on April 12, 2016, the City Council
adopted the Resolution of Formation, which established the District and set forth the RMA for the District. On
April 12, 2016 an election was held within the District in which the landowners eligible to vote unanimously
approved the proposed bonded indebtedness and the levy of the Special Taxes within the District.
The Vista Canyon Project is bordered by other residential planned communities to the west, and south,
the Santa Clara River and the 14 Freeway, along with residential planned communities, to the north and rural
residential and two elementary schools to the east. Access to the Vista Canyon Project is currently available
from Lost Canyon Road and Humphries, but will also include Vista Canyon Boulevard by way of the to -be -
completed Vista Canyon Bridge. The District consists of all property within the Vista Canyon Project except for
property designated for single-family residential. The District is divided into two zones: Zone 1 and Zone 2.
40
CITY OF SANTA CLARITA COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
Designation of Zones
LAND USE
VISTA CANYON ffffi Town Center - Retail & Office
6e4eedair! Crtayaer Srruf -' Yawn Center - Retad S. Mulf i Famfly
Creative Office Campus
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Highway 14
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C': MI
r=3 TAX ZONE BMW
4"1 Holyd
f
M Ulli-Femfly Resider aial
y ...� l4eighbo0w d ResldenUal
...._ �I mevatink Station and Sus T anafer Slabon
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[%/l�, Parldng 91tructure
Abler R:edamalim Plant
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ryun Reed
Zone 1 consists of 7 taxable parcels and its approved land uses include 519 multifamily units,
approximately 79,259 square feet of retail/service/commercial space, and approximately 121,718 square feet of
office space. Zone 2 will consist of 21 taxable parcels and its approved land uses include 336 multifamily units,
78,300 square feet of retail/service/commercial space, 542,500 square feet of office space and a 200-room hotel.
Developed Property. The Developed Property within Zone 1 consists of (a) two taxable parcels totaling
12.8 acres zoned as multifamily for 480 apartments which is owned by Jefferson, and (b) an approximately 0.62
acre taxable parcel owned by VC Lincoln which is being developed and is under construction for a three story
mixed -use building.
Undeveloped Property. The remaining taxable property within Zones 1 and 2 of the District is owned
by either VC Lincoln or Vista Canyon Phase L See "DEVELOPMENT WITHIN THE DISTRICT" herein.
Additionally, the apartment units within the District are also subject to a special tax levied and collected
by Sulphur Springs CFD. For Fiscal Year 2019-20, the assigned tax that was levied is $557.45 per apartment
unit. This special tax contains an annual escalator of 2% per year. The Sulphur Springs CFD is authorized to
issue up to $19.5 million of special tax bonds secured by the special tax revenues generated by such community
facilities district. Vista Canyon Ranch estimates that at full buildout of the Vista Canyon Project, the property
within the District will also bear approximately 42% of the total special taxes levied by Sulphur Springs CFD.
The special taxes levied by Sulphur Springs CFD are parity liens on any parcel of property taxed by both the
District and Sulphur Springs CFD.
41
Developed Property within Zone 1 and Zone 2 could be subject to annual Special Taxes for Services for
the District. Pursuant to the RMA, the Special Tax for Services will only be levied in a Fiscal Year if it is
determined that a property owner association is not maintaining the Cooper Street parking structure (anticipated
to be completed on February 15, 2020) or the Vista Canyon Boulevard parking structure (to be completed in the
future). These parking structures have not been completed and turned over to the City, and it is required that
they be maintained by a property owner association. Therefore, the Special Tax for Services has not yet been
levied and is not expected to be levied. For the 2019-20 Fiscal Year, the Special Tax for Services was $120.50
per developed apartment unit, $0.21 and $0.54 per square foot for office/nonresidential and retail, respectively
and $54.18 per hotel room. This special tax contains an annual escalator tied to the consumer price index.
Undeveloped Property is not subject to the services special tax.
Summary of Rate and Method
The Rate and Method of Apportionment of Special Taxes (the "RMA) is appended hereto in its entirety
as APPENDIXD. The following is only a summary of certain provisions of the RMA and does not purport to be
complete. For a comprehensive understanding of the RMA, it must be read in its entirety.
The RMA classifies taxable properties within the District into two zones: Zone 1 and Zone 2, and into
five classifications within each Zone: "Developed Property," "Taxable Public Property," "Taxable Property
Owner Association Property," "Taxable Religious Property," or "Undeveloped Property." Developed Property
will further be classified as "Apartment," "Office," "Retail," "Non -Residential," "Hotel," or "Condominium
Conversion" property. "Developed Property" means, for each Fiscal Year, all Taxable Property, exclusive of
Taxable Property Owner Association Property, Taxable Public Property, and Taxable Religious Property, for
which a building permit for new construction was issued prior to May 1 of the prior Fiscal Year.
For each Fiscal Year, the City will levy the Special Tax for Facilities until the amount of Special Tax for
Facilities levied equals the Special Tax Requirement for Facilities. "Special Tax Requirement for Facilities"
means for each Fiscal Year, that amount required for the District to pay the sum of: (i) debt service on all
Outstanding Bonds or Bonds expected to be issued 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 related to the Special Tax for Facilities; (iv) any amounts required to establish a reserve fund for
Bonds expected to be issued in such Fiscal Year or replenish any reserve funds established by the Fiscal Agent
Agreement for any Outstanding Bonds to the extent such replenishment has not been included in the
computation of the Special Tax Requirement for Facilities in a previous Fiscal Year; and (v) any amounts
required for construction of facilities eligible to be constructed or acquired by the District under the Act,
provided that such amounts do not increase the Special Tax for Facilities levied on Undeveloped Property,
Taxable Public Property, Taxable Religious Property, and Taxable Property Owners' Association Property.
The Special Tax for Facilities shall be levied each Fiscal Year prior to completion of development, in
the order listed, as follows:
First: The Special Tax for Facilities shall be levied Proportionately on each Assessor's Parcel of
Developed Property within Zone 1 at up to 100% of the applicable Assigned Special Tax for Facilities as needed
to satisfy the Special Tax Requirement for Facilities;
Second: If additional monies are needed, the Special Tax for Facilities shall be levied Proportionately on
each Assessor's Parcel of Undeveloped Property within Zone 1 at up to 100% of the Maximum Special Tax for
Facilities for Undeveloped Property;
Third: If additional monies are needed, then the Special Tax for Facilities shall be levied Proportionately
on each Assessor's Parcel of Developed Property within Zone 2 at up to 100% of the applicable Assigned
Special Tax for Facilities;
42
Fourth: If additional monies are needed, the Special Tax for Facilities shall be levied Proportionately on
each Assessor's Parcel of Undeveloped Property within Zone 2 at up to 100% of the Maximum Special Tax for
Facilities for Undeveloped Property;
Fifth: If additional monies are needed, then the levy of the Special Tax for Facilities on each Assessor's
Parcel of Developed Property in Zone 1 and each Assessor's Parcel of Developed Property in Zone 2 for which
the Maximum Special Tax for Facilities is determined through the application of the Backup Special Tax for
Facilities shall be increased Proportionately from the Assigned Special Tax for Facilities up to the Maximum
Special Tax for Facilities for each such Assessor's Parcel;
Sixth: If additional monies are needed, then the Special Tax for Facilities shall be levied Proportionately
on each Assessor's Parcel of Taxable Property Owner Association Property or Taxable Religious Property at up
to the Maximum Special Tax for Facilities for Taxable Property Owner Association Property or Taxable
Religious Property; and
Seventh: If additional monies are needed, then the Special Tax for Facilities shall be levied
Proportionately on each Assessor's Parcel of Taxable Public Property at up to the Maximum Special Tax for
Facilities for Taxable Public Property.
Once the CFD administrator has determined that there is no Undeveloped Property in both Zone 1 and
Zone 2, the Special Tax for Facilities shall be levied each Fiscal Year as follows:
First: The Special Tax for Facilities shall be levied Proportionately on each Assessor's Parcel of
Developed Property within Zone 1 and Zone 2 at up to 100% of the applicable Assigned Special Tax for
Facilities as needed to satisfy the Special Tax Requirement for Facilities;
Second: If additional monies are needed, then the levy of the Special Tax for Facilities on each
Assessor's Parcel of Developed Property in Zone 1 and Zone 2 for which the Maximum Special Tax for
Facilities is determined through the application of the Backup Special Tax for Facilities shall be increased
Proportionately from the Assigned Special Tax for Facilities up to the Maximum Special Tax for Facilities for
each such Assessor's Parcel;
Third: If additional monies are needed, then the Special Tax for Facilities shall be levied Proportionately
on each Assessor's Parcel of Taxable Property Owner Association Property or Taxable Religious Property at up
to the Maximum Special Tax for Facilities for Taxable Property Owner Association Property or Taxable
Religious Property; and
Fourth: If additional monies are needed, then the Special Tax for Facilities shall be levied
Proportionately on each Assessor's Parcel of Taxable Public Property at up to the Maximum Special Tax for
Facilities for Taxable Public Property.
On each July 1, the Maximum Special Tax for Facilities for all parcels of taxable property will increase
by an amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year.
Since by definition "for -sale" residential property constitutes Exempt Property under the RMA, Vista
Canyon Phase I has recorded a covenant to run with the land on all of the currently Undeveloped Property in the
District (other than Lot 5 of Final Tract Map 69164-01) within Zone 1 and Zone 2 that provides that no for -sale
residential units shall be initially built, developed or located on all or any portion of such property.
43
TABLE 2
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
ASSIGNED SPECIAL TAX FOR FACILITIES FOR DEVELOPED PROPERTY
Zone 1 and Zone 2
For Fiscal Year 2019-20
Land Use Class Description Assigned Special Tax for Facilities
1
Apartment Property
$707.83 per Apartment Unit
2
Office Property
$1.22 per sq. ft. of Floor Area
3
Retail Property
$3.18 per sq. ft. of Floor Area
4
Non -Residential Property
$1.22 per sq. ft. of Floor Area
5
Hotel Property
$318.36 per Hotel Room
6
Condominium Conversion Property
$707.83 per Unit
Source: RMA.
The Maximum Special Tax for Facilities for each Assessor's Parcel classified as Developed Property
shall be the greater of (i) the amount derived by application of the Assigned Special Tax for Facilities or (ii) the
amount derived by application of the Backup Special Tax for Facilities for the Zone in which such Assessor's
Parcel is located.
The Backup Special Tax for Facilities for Assessor's Parcels of Developed Property in Zone 1 is equal
to $49,581 per Acre for Fiscal Year 2019-20, and the Backup Special Tax for Facilities for Assessor's Parcels of
Developed Property in Zone 2 is equal to $123,002 per Acre for Fiscal Year 2019-20.
On each July 1, the Maximum Special Tax for Facilities for Taxable Property Owner Association
Property, Taxable Public Property, Taxable Religious Property, and Undeveloped Property will increase by an
amount equal to two percent (2%) of the amount in effect for the previous Fiscal Year. For Fiscal Year 2019-20,
the Maximum Special Tax for Facilities for Taxable Property Owner Association Property, Taxable Public
Property, Taxable Religious Property, and Undeveloped Property is equal to $49,581 per Acre for Assessor's
Parcels in Zone 1 and $123,002 per Acre for Assessor's Parcels in Zone 2.
The RMA provides that the Special Tax will be collected in the same manner and at the same time as
ad valorem property taxes, or alternatively, at the discretion of the City Council, the District may separately bill
and collect the Special Tax from each property owner of record. The District intends to continue the practice of
collection of the Special Taxes on the property tax bills.
The RMA also includes provisions for, and the calculation processes for, the prepayment of the Special
Tax, in full or in part, on each property.
Projected Special Tax Coverage
The amount of Special Taxes that was levied for Fiscal Year 2019-20 for the first step of the RMA is
$451,451.36, and for the second step of the RMA is $123,548.64, for a total Fiscal Year 2019-20 Special Tax
Levy of $575,000.00 with $25,000 budgeted for Administrative Expenses. This calculation of the annual
Special Tax levy is based on the number of units, square feet, or acres shown in the following table. The type of
property and the related acreage or number of units within the District are shown in Table 3, as well as the
maximum and annual Special Tax levy for each type of property within the District for Fiscal Year 2019-20. No
Special Tax was levied on property within Zone 2 for Fiscal Year 2019-20.
44
As of January 15, 2020, no parcels were delinquent in the payment of special taxes for the first
installment of the Fiscal Year 2019-20 levy.
TABLE 3
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
ACTUAL SPECIAL TAX FOR FACILITIES LEVY SUMMARY FOR 2019-20
Units/
Maximum/
FY 2019-2020
FY 2019-2020
% of
Sq. Ft./
Assigned
Special Tax
% of Max.
Special Tax
Type of Property
Acres(')(2)
Special Tax
Levied(3)(4)
Special Tax
Levied
ZONE 1
Developed
Apartment Property
480 units
$707.83/unit
$339,756.35
100.0%
59.1%
Office Property
39,718 sq. ft.
$1.22/sq. ft.
48,471.42
100.0
8.4
Retail Property
19,859 sq. ft.
$3.18/sq. ft.
63,223.59
100.0
11.0
Undeveloped Property
8.16 acres
$49,581 per acre
$123,548.64
30.5%
21.5%
Zone 1 Subtotal
$575,000.00
100.0%
ZONE 2
Developed
Apartment Property
0 units $707.83/unit
$ 0.00
0.0%
0.0%
Office Property
0 sq. ft. $1.22/sq. ft.
0.00
0.0
0.0
Retail Property
0 sq. ft. $3.18/sq. ft.
0.00
0.0
0.0
Non Residential Property
0 sq. ft. $1.22/sq. ft.
0.00
0.0
0.0
Hotel Property
0 room $318.36/room
0.00
0.0
0.0
Undeveloped Property
18.57 acres $123,002 per acre
$ 0.00
0.0%
0.0%
Zone 2 Subtotal
$ 0.00
0.0%
Total Fiscal Year 2019-20 Special Tax Levy
$575,000.00
100.0%
Developed Levy
$451,451.36
78.5%
Undeveloped Property Acres
26.73
Undeveloped Property Levy
$123,548.64
21.5%
(1) Acreage includes parcels that are designated as association property or parking structure property, which are not expected to be levied
beginning in Fiscal Year 2020-21.
(2) Acreage totals listed may not match those listed in the Appraisal due to differences between gross and net acreage and the assignment
of certain association use parcels as non-taxable based on the RMA(including the .37 acre parcel owned by Jefferson adjacent to the 480
Complex).
(3) Fiscal Year 2019-20 Special Tax Levy for Undeveloped Property in Zone 1 is levied at less than the maximum special tax rate.
Source: CFD Administrator, Special Tax Consultant and RMA.
In Table 4, the Special Tax Consultant projected the Special Tax Requirement for Facilities in Fiscal
Year 2020-21, the first full year. Key assumptions include no change in amount of Developed Property from
Fiscal Year 2019-20, but the exclusion from Undeveloped Property of 1.42 acres for the Cooper Street parking
facility and approximately 3.55 acres within Zone 1 and 0.83 acres within Zone 2 for Association Property.
45
The projected Special Tax Requirement for Facilities in Fiscal Year 2020-21 totals $842,700* calculated
at 100% of the Assigned Special Tax Rates for Developed Property and Undeveloped Property for Zone 1 and
10.7%* of the Maximum Special Tax Rates for Undeveloped Property for Zone 2.
TABLE 4
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
PROJECTED SPECIAL TAX FOR FACILITIES LEVY SUMMARY FOR 2020-21'
Units/
Maximum/
FY 2020-2021
FY 2020-2021
% of
Sq. Ft./
Assigned
Special Tax
% of Max.
Special Tax
Type of Property
Acres(1(2))
Special Tax
Levied()
Special Tax
Levied
ZONE 1
Developed
Apartment Property
480 units
$721.98/unit
$346,551.48
100.0%
41.1%
Office Property
39,718 sq. ft.
$1.24/sq. ft.
49,440.85
100.0
5.9
Retail Property
19,859 sq. ft.
$3.25/sq. ft.
64,488.06
100.0
7.7
Undeveloped Propertv
Zone 1 Subtotal
ZONE 2
Developed
Apartment Property
Office Property
Retail Property
Non Residential Property
Hotel Property
Undeveloped Propertv
Zone 2 Subtotal
2.83 acres $50,572 per acre $142,967.93 100.0% 17.0%
$603,448.32
71.6%
0 units
$721.98/unit
$ 0.00
0.0%
0.0%
0 sq. ft.
$1.24/sq. ft.
0.00
0.0
0.0
0 sq. ft.
$3.25/sq. ft.
0.00
0.0
0.0
0 sq. ft.
$1.24/sq. ft.
0.00
0.0
0.0
0 room
$324.73/room
0.00
0.0
0.0
17.74 acres
$125,463 per acre
$239,251.68
10.4%
28.4%
$239,251.68
28.4%
Total Fiscal Year 2020-21 Special Tax Levy
Developed Levy
Undeveloped Property Acres
Undeveloped Property Levy
$842,700.00 100.00%
$460,480.39 54.6%
20.57
$382,219.61 45.4 %
(1) Acreage does not include parcels that are designated as association property or parking structure property, which are not expected to be
levied beginning in Fiscal Year 2020-21.
(2) Acreage totals listed may not match those listed in the Appraisal due to differences between gross and net acreage and the assignment of
certain association use parcels as non-taxable based on the RMA(including the .37 acre parcel owned by Jefferson adjacent to the 480
Complex)..
(3) Fiscal Year 2020-21 Special Tax Levy for Undeveloped Property in Zone 2 is levied at less than the maximum special tax rate.
Source: CFD Administrator, Special Tax Consultant and RMA.
. Preliminary, subject to change.
46
The District's Special Tax Consultant and the Underwriter have prepared the following table which
displays projected debt service coverage assuming the levy of the Maximum Special Tax under the First through
Fourth Steps of the RMA for each remaining Fiscal Year and further assuming deductions of the Administrative
Expense Requirement for each period. The projections include the current development status and the
assumptions under Table 4 for Fiscal Year 2020-2 1.
TABLE 5
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
PROJECTED DEBT SERVICE COVERAGE
Maximum Special Tax
Estimated
Estimated
Period
Revenues Under First
Administrative
Estimated
Bond Year
Estimated
Ending
Thru Fourth Steps
Expense
Net Tax
Debt
Debt Service
September 1
of RMA')
Requirement
Revenues(2)
Service
Coverage
2020
$3,140,434
$25,000
$3,115,434
$ 397,210
7.84:1
2021
2,829,656
25,500
2,804,156
817,200
3.43:1
2022
2,886,249
26,010
2,860,239
833,400
3.43:1
2023
2,943,974
26,530
2,917,444
848,800
3.44:1
2024
3,002,853
27,061
2,975,793
868,400
3.43:1
2025
3,062,910
27,602
3,035,308
887,000
3.42:1
2026
3,124,169
28,154
3,096,015
904,600
3.42:1
2027
3,186,652
28,717
3,157,935
921,200
3.43:1
2028
3,250,385
29,291
3,221,094
941,800
3.42:1
2029
3,315,393
29,877
3,285,515
956,200
3.44:1
2030
3,381,701
30,475
3,351,226
979,600
3.42:1
2031
3,449,335
31,084
3,418,250
996,600
3.43:1
2032
3,518,321
31,706
3,486,615
1,017,400
3.43:1
2033
3,588,688
32,340
3,556,348
1,036,800
3.43:1
2034
3,660,461
32,987
3,627,474
1,059,800
3.42:1
2035
3,733,671
33,647
3,700,024
1,081,200
3.42:1
2036
3,808,344
34,320
3,774,024
1,101,000
3.43:1
2037
3,884,511
35,006
3,849,505
1,124,200
3.42:1
2038
3,962,201
35,706
3,926,495
1,145,600
3.43:1
2039
4,041,445
36,420
4,005,025
1,165,200
3.44:1
2040
4,122,274
37,149
4,085,125
1,193,000
3.42:1
2041
4,204,720
37,892
4,166,828
1,213,600
3.43:1
2042
4,288,814
38,649
4,250,164
1,237,200
3.44:1
2043
4,374,590
39,422
4,335,168
1,263,600
3.43:1
2044
4,462,082
40,211
4,421,871
1,287,600
3.43:1
2045
4,551,324
41,015
4,510,309
1,314,200
3.43:1
2046
4,642,350
41,835
4,600,515
1,343,200
3.43:1
2047
4,735,197
42,672
4,692,525
1,369,400
3.43:1
2048
4,829,901
43,526
4,786,376
1,392,800
3.44:1
2049
4,926,499
44,396
4,882,103
1,423,400
3.43:1
2050
5,025,029
45,284
4,979,745
1,450,800
3.43:1
1. Based on Maximum Special Tax Revenues available under the First thru Fourth Steps of the RMA. Such amount shall escalate annually by 2.0%
The 2020 amount includes Special Tax revenues for property expected to become exempt.
2. Based on Maximum Special Tax Revenues under the First thru Fourth Steps of the RMA less the estimated Administrative Expense Requirement.
Sources: Special Tax Consultant and Underwriter.
. Preliminary, subject to change.
47
Appraisal
The information below is only a summary of certain information contained in the Appraisal. The
Appraisal is reprinted herein as Appendix G. The information below is qualified in its entirety by the complete
Appraisal. The District and the Underwriter make no representations as to the accuracy or completeness of the
Appraisal.
The 2020 Bonds are secured by Special Taxes which may include amounts realized upon foreclosure
sale of delinquent parcels. The ability of the District to meet debt service on the 2020 Bonds may depend on the
ability of delinquent parcels to generate sufficient proceeds upon foreclosure sale to pay delinquent Special
Taxes. The City commissioned Integra Realty Resources, San Francisco, California (the "Appraiser") to
ascertain the market value by ownership of the fee simple interest of the properties within the District, as well as
provide a cumulative or aggregate value of the properties, as of the December 2, 2019 date of value. The
properties appraised consist of (a) within Zone 1, parcels owned by Jefferson and currently under construction
for development of 480 apartments; (b) within Zone 1, parcel owned by VC Lincoln and currently under
construction and being developed as a three story mixed -use building, (c) undeveloped land consisting of
approximately 2.8 taxable acres on four mixed -use and commercial parcels with a final map within Zone 1
owned by either VC Lincoln or Vista Canyon Phase I, and (d) approximately 13 taxable gross acres on three
parcels zoned for mixed -use, commercial, office, multi -family and hotel, and approximately 4.4 acres of
multifamily lots within Zone 2 owned by either VC Lincoln or Vista Canyon Phase L See "DEVELOPMENT
WITHIN THE DISTRICT." The properties described in (a) and (b) above are designated as Developed
Property.
Subject to the assumptions and limitations contained in the Appraisal, the Appraiser estimated that the
market value (subject to the hypothetical condition of the Cooper Street parking facility being acquired with the
proceeds of the 2020 Bonds and subject to the lien of the Special Taxes) is $78,700,000 for the property owned
by Jefferson, using the Sales Comparison Approach to value, giving market value of the units at $31,200,000
and taking into account approximately $47,500,000 in prepaid impact fees and site work costs to date.
Subject to the assumptions and limitations contained in the Appraisal, the Appraiser estimated that the
market value (subject to the hypothetical condition of the Cooper Street parking facility being acquired with the
proceeds of the 2020 Bonds and subject to the lien of the Special Taxes) is $45,840,000 for properties owned by
VC Lincoln and Vista Canyon Phase I using a discounted cash flow analysis or subdivision development
method. The estimated market value for property owned by VC Lincoln and Vista Canyon Phase I within Zone
1 is $20,100,000 and within Zone 2 is $25,740,000 for a total estimated market value of $45,840,000.
The estimated market value for Jefferson -owned property is $78,700,000, and for remaining property is
$45,840,000 for an aggregate combined value of $124,540,000.
Below is a summary of the appraised valuations for the overall District, each Zone and for Developed
and Undeveloped Property within the District subject to the Appraisal.
48
SUMMARY OF APPRAISED VALUATIONS
BASED ON DISTRICT APPRAISAL AS OF DECEMBER 2,
2019
Developed
Overall Appraised Undeveloped
Appraised Valuation Valuation Appraised Valuation
Zone 1 Zone 2 Total Zone 1 Zone 1 Zone 2 Total
Total I $98,800,000 $25,740,000 $124,540,000 11 $90,254,215 I $8,545,785 $25,740,000 $34,285,785
Jefferson $78,700,000
VC Lincoln $11,554,215
VC Lincoln / $8,545,785 $25,740,000 $34,285,785
Vista Canyon
Phase 1
Source: Special Tax Consultant and Appraisal.
An updated Appraisal has not been requested by the City or the District or completed by the Appraiser
since the December 2, 2019 date of value. However, on the date of issuance of the Bonds, the Appraiser will
certify that he is not aware of any event or act that occurred since the date of value of the Appraisal which, in the
opinion of the Appraiser, would materially and adversely affect the conclusions in the Appraisal as to the market
value of the appraised property.
The Appraisal's value estimates reflect certain assumptions set forth in the Appraisal. For a full
description of the assumptions relied upon by the Appraiser, as well as a description of the valuation
methodology, see APPENDIX D — "APPRAISAL REPORT".
The Appraisal was prepared in accordance with and subject to the requirements of The Appraisal
Standards for Land Secured Financing as published by the California Debt and Investment Advisory
Commission, the Uniform Standards of Professional Appraisal Practice (USPAP) of the Appraisal Foundation,
and the Code of Professional Ethics and the Standards of Professional Appraisal Practice of the Appraisal
Institute. See APPENDIX D — "APPRAISAL REPORT".
[Remainder of Page Intentionally Left Blank]
49
Valuation
Table 6 sets forth the breakdown of Developed and Undeveloped Property within the District by
ownership, their share of the projected Special Tax Requirement for Facilities for Fiscal Year 2020-21 (the first
full year without capitalized interest credit), and their applicable appraised values. See "Appraisal' above.
TABLE 6
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
TAXPAYERS FOR FISCAL YEAR 2020-21
No. of
FY 2020-21
% of
12/2/19
Taxable Est.
Special Tax
FY 2020-21
Appraised
Property Owner(s)
Zone Use Parcels(') Acreage(l)(2)
Levy
Levy
Value
Master Developer
Developed — Zone 1
VC Lincoln I, LLC
1 Mixed -Use 1 0.6
$113,928.91
13.5%
$ 11,554,215
Undeveloped — Zone 1
Vista Canyon Phase I, LLC
1 Multifamily 2 1.1
54,618.10
6.5
3,264,750
VC Lincoln I, LLC
Undeveloped — Zone 2
Vista Canyon Phase I, LLC
VC Lincoln I, LLC
Subtotal
Merchant Builder (Developed)
Jefferson Vista Canyon LLC
Subtotal
Total
Mixed -Use
Retail/Office
Commercial
Hotel
1 Mixed Use 2 1.7
2
2
1
Multifamily
Mixed -Use
Retail/Office
Commercial
Hotel
Mixed Use
88,349.83 10.5
10 17.2 231,417.75 27.5
1 0.6 7,833.93 0.9
16 21.2 $496,148.52 58.9%
5,281,035
24,897,183
842,817
$45,840,000
Multifamily 2 12.8 $346,551.48 41.1% $78,700,000
2 12.8 $346,551.48 41.1% $78,700,000
18 "A S842,700.00 100.00-a S124,540,000
(1) Number of taxable parcels and acreage does not include parcels that are designated as Association Property or parking structure property,
which are not expected to be levied beginning Fiscal Year 2020-21.
(2) Acreage totals listed may not match those listed in the Appraisal due to differences between gross and net acreage and the assignment of
certain association use parcels as non-taxable based on the RMA (including the .37 acre parcel owned by Jefferson adjacent to the 480 Complex).
Source: Special Tax Consultant and Appraisal.
. Preliminary, subject to change.
50
Estimated Value -to -Lien Ratios
Given these estimated appraised values, the Developed Property owned by Jefferson has a value -to -lien
ratio of 10.60* to 1, the Developed Property owned by VC Lincoln has a value -to -lien ratio of 4.73* to 1, for a
combined Developed Property value -to -lien ratio of 9.15* to 1. Given these estimated appraised values, the
Undeveloped Property owned by VC Lincoln and Vista Canyon Phase I has a combined value -to -lien ratio of
4.19* to 1. Given these estimated appraised values, the value -to -lien ratio of Zone 1 is 7.65* to 1 and of Zone 2
is 5.02* to 1.
The combined value of just over $124.5 million for taxable property within the District, results in an
estimated overall value -to -lien ratio of 6.90* to 1 based on the appraised value within the District and the
principal amount of the 2020 Bonds, and an estimated combined value -to -lien ratio of 6.60* to 1 based on the
direct and overlapping debt within the District. fi See "-Appraisal' herein.
No assurance can be given that such value -to -lien ratios will be maintained during the period of time
that the 2020 Bonds are outstanding. The District does not have any control over future property values or the
amount of additional indebtedness that may be issued in the future by other public agencies, the payment of
which is made through the levy of a tax or an assessment with a lien on a parity with the Special Taxes. See
"SPECIAL RISK FACTORS —Appraised Valuations; Value -to -Lien Ratios" and "—Parity Taxes and Special
Assessments."
Table 7 below is a brief summary of the overall value to lien ratio, the value to lien ratio for each Zone
and the value to lien ratio for Developed and Undeveloped Property within the District, based on the estimated
appraised values from the Appraisal, the estimated Fiscal Year 2020-21 levy amount of $842,700* and the
estimated par amount of the 2020 Bonds of $18,055,000.* The par amount of the 2020 Bonds has been allocated
to the taxed parcels in proportion to their respective Fiscal Year 2020-21 special tax obligation. Table 8 provides
a more detailed review of the overall, and the Developed/Undeveloped value to lien ratios for the District.
Neither table includes any authorized but unissued debt of the Sulphur Springs CFD secured by parcels within
the District developed or designated for development as apartment units.
TABLE 7
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
SUMMARY OF VALUE TO LIEN RATIOS*
BASED ON DISTRICT APPRAISAL AS OF DECEMBER 2, 2019
Overall Developed Undeveloped
Value to Lien (to 1) Value to Lien (to 1) Value to Lien (to 1)
Zone 1 Zone 2 Total Zone 1 Zone 1 Zone 2 Total
Total 7.65 5.02 6.90 9.15 2.79 5.02 4.19
Jefferson 10.60
VC Lincoln 4.73
VC Lincoln / Vista Canyon Phase 1 2.79 5.02 4.19
Source: Special Tax Consultant and Appraisal.
* Preliminary, subject to change.
T Sulphur Springs CFD has a bond authorization of $19.5 million, of which approximately $8.2 million is estimated to be secured by
special taxes levied or to be levied on parcels within the District developed or designated for development of apartment units. Bonds for
Sulphur Springs CFD have not yet been issued and are not included in the direct and overlapping debt. See "SECURITY FOR THE
2020 BONDS — Other Indebtedness and Obligations."
51
TABLE 8
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
ESTIMATED VALUE -TO -LIEN RATIOS*T
DEVELOPED PROPERTY
Taxable
Estimated
No. of
Parcels
FY 20-21
FY 20-21
Value
Taxable
(Units/Sq. Ft.
Appraised
Levy
Levy
2020
To
Owner Parcels(')
Acreage)(')(')
Value()
Amount(4*)
%*
Bonds( )*
Lien
Zone 1
Jefferson Vista Canyon, LLC 2
480 units
$78,700,000
$346,551
41.1%
$7,424,928
10.60 to 1
VC Lincoln I, LLC 1
59,577 sq. ft.
11,554,215
113,929
13.5
2,440,947
4.73 to 1
Total 3 $90,254,215 $460,480 54.6% $9,865,876 9.15 to 1
UNDEVELOPED PROPERTY
Taxable
Estimated
No. of
Parcels
FY 20-21
FY 20-21
Value
Taxable
(Units/Sq. Ft.
Appraised
Levy
Levy
2020
To
Owner
Parcels(')
Acreage)(' )(2)
Value(3)
Amount(4)*
%*
Bonds(5)*
Lien
Zone 1
Vista Canyon I, LLC
2
1.1 acres
$3,264,750
$54,618
6.5%
$1,170,203
2.79 to 1
VC Lincoln I, LLC
2
1.7 acres
5,281,035
88,350
10.5
1,892,911
2.79 to 1
Zone 2
Vista Canyon I, LLC
10
17.2 acres
24,897,183
224,840
27.5
4,958,167
5.02 to 1
VC Lincoln I, LLC
1
0.6 acres
842,817
7,611
0.9
167,843
5.02 to 1
Total 18 20.6 $34,285,785 $375,420 45.4% $8,189,124 4.19 to 1
COMBINED PROPERTY
Total Estimated 2020 Estimated Value -
Appraised Value(') Bonds(s)* To -Lien
$124,540,000 $18,055,000 6.90 to 1
(1) Number of parcels and acreage does not include parcels that are designated as association property or parking structure property, which are not
expected to be levied beginning Fiscal Year 2020-2 1.
(2) Acreage totals listed may not match those listed in the Appraisal due to differences between gross and net acreage and the assignment of certain
association use parcels as non-taxable based on the RMA.
(3) Represents the estimated appraised values from the Appraisal.
(4) Total estimated Fiscal Year 2020-21 levy amount ($842,700) is based on estimated administrative expenses and bond debt service for the period
ending 9/1/2021 as shown in Table 4.
(5) Estimated par amount of the 2020 Bonds ($18,055,000)* has been allocated to the taxed parcels in proportion to their respective Fiscal Year 2020-
21 special tax obligation.
Source: Special Tax Consultant and Appraisal.
T Sulphur Springs CFD has a bond authorization of $19.5 million, of which approximately $8.2 million is estimated to be secured by special taxes
levied or to be levied on parcels within the District developed or designated for development of apartment units. Bonds for Sulphur Springs CFD
have not yet been issued and are not included in the direct and overlapping debt. See "SECURITY FOR THE 2020 BONDS — Other Indebtedness
and Obligations."
. Preliminary, subject to change.
52
Direct and Overlapping Debt and Other Obligations
Local agencies providing public services which have issued general obligation bond and other types of
indebtedness overlap the District. Direct and overlapping bonded indebtedness is shown in the following table
compiled by California Municipal Statistics, Inc. of Oakland, California. The District has not independently
verified the information in the table and makes no representations as to completeness or accuracy.
The total direct and overlapping debt shown in Table 9 below is $828,453. Adding in the principal
amount of the 2020 Bonds would result in a direct and overlapping debt of $18,883,453.* The resulting all-
inclusive value to debt ratio is 6.60* to Ifi.
TABLE 9
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(VISTA CANYON)
DIRECT AND OVERLAPPING DEBT STATEMENT
2019-20 Assessed Valuation: $41,438,294
DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT:
% Applicable
Debt 12/1/19
Santa Clarita Community College District
0.090%
$292,436
William S. Hart Union High School District
0.090
294,851
Sulphur Springs Union School District
0.499
239,495
City of Santa Clarita Open Space and Parkland Assessment District
0.010
1,318
City of Santa Clarita Landscaping and Lighting Maintenance District
0.002
353
City of Santa Clarita Community Facilities District No. 2016-1
100.
- (1)
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT
$828,453
OVERLAPPING GENERAL FUND DEBT:
Los Angeles County General Fund Obligations
0.003%
$ 60,325
Los Angeles County Superintendent of Schools Certificates of Participation
0.003
133
Santa Clarita Community College District Certificates of Participation
0.090
7,256
William S. Hart Union High School District Certificates of Participation
0.090
39,658
Sulphur Springs Union School District Certificates of Participation
0.499
126,606
City of Santa Clarita Obligations
0.118
42,523
TOTAL OVERLAPPING GENERAL FUND DEBT
$276,501
COMBINED TOTAL DEBT $1,104,954 (2)
(1) Excludes issue to be sold.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and non -bonded capital lease obligations.
Ratios to 2019-20 Assessed Valuation:
DirectDebt...................................................................................... 0.00%
Total Overlapping Tax and Assessment Debt .................................. 2.00%
Combined Total Debt....................................................................... 2.67%
Source: California Municipal Statistics, Inc.
. Preliminary, subject to change.
t Sulphur Springs CFD has a bond authorization of $19.5 million, of which approximately $8.2 million is estimated to be
secured by special taxes levied or to be levied on parcels within the District developed or designated for development of
apartment units. Bonds for Sulphur Springs CFD have not yet been issued and are not included in the direct and
overlapping debt. See "SECURITY FOR THE 2020 BONDS —Other Indebtedness and Obligations."
53
In addition to the bonded indebtedness set forth in Table 9, any general obligation bonds currently
authorized but not issued within the District will likely be issued and new general obligation bonds may be
authorized at future elections. New community facilities districts or special assessment districts may be formed
which include all or a portion of the District, resulting in the issuance of more bonds and the levy of additional
special taxes or other taxes and assessments on parcels within the District. In addition to the Special Taxes, the
property owners in the District will be required to pay the general ad valorem property taxes for their parcels.
See "SPECIAL RISK FACTORS —Parity Taxes and Special Assessments" and "—Appraised Valuations;
Value -to -Lien Ratios."
SPECIAL RISK FACTORS
The purchase of the 2020 Bonds involves significant investment risks and, therefore, the 2020 Bonds
may not be suitable investments for many investors. The following is a discussion of certain risk factors which
should be considered, in addition to other matters set forth herein, in evaluating the investment quality of the
2020 Bonds. This discussion does not purport to be comprehensive or definitive. The occurrence of one or
more of the events discussed herein could adversely affect the ability or willingness ofproperty owners in the
District to pay their Special Taxes when due. Such failures to pay Special Taxes could result in the inability of
the District to make full and punctual payments of debt service on the 2020 Bonds. In addition, the occurrence
of one or more of the events discussed herein could adversely affect the value of the property in the District. See
"SPECIAL RISK FACTORS Appraised Valuations; Value -to -Lien Ratios" and " No Ratings and Limited
Secondary Market" below.
Risks of Real Estate Secured Investments Generally
The Owners of the 2020 Bonds will be subject to the risks generally incident to an investment secured
by real estate, including, without limitation, (i) adverse changes in local market conditions, such as changes in
the market value of real property in the vicinity of the District, the supply of or demand for competitive
properties in such area, and the market value of residential property or commercial buildings and/or sites in the
event of sale or foreclosure; (ii) changes in real estate tax rates and other operating expenses, governmental rules
(including, without limitation, zoning laws and laws relating to endangered species and hazardous materials) and
fiscal policies; (iii) natural disasters (including, without limitation, earthquakes, wildfires and floods), which
may result in uninsured losses; (iv) adverse changes in local market conditions; and (v) increased delinquencies
due to rising mortgage costs and other factors.
Other factors that could adversely affect property values in the District include, among others, relocation
of employers out of the area, shortages of water, electricity, natural gas or other utilities, and destruction of
property caused by man-made disasters.
Limited Obligations
The District has no obligation to pay principal of or interest on the 2020 Bonds if Special Tax
collections are delinquent or insufficient, other than from funds derived from the foreclosure and sale of parcels
for Special Tax delinquencies. The City is not obligated to advance funds to pay debt service on the 2020
Bonds.
Failure to Develop Undeveloped Properties
Land development operations are subject to comprehensive Federal, State and local regulations.
Approval is required from various agencies in connection with the layout and design of developments, the
nature and extent of improvements, construction activity, land use, zoning, school and health requirements, as
well as numerous other matters. While the undeveloped land in the District is entitled as to discretionary City
approvals by reason of its Specific Plan, and all other City land use approvals and zoning approvals have been
obtained, there is always the possibility that such approvals, even though obtained, could be subject to
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subsequent referendum, or that the issuance of additional building permits will be delayed. Revocation of any
such agency approval could adversely affect the development of the undeveloped land. See APPENDIX G —
"THE APPRAISAL REPORT."
Under current California law, it is generally accepted that proposed development is not exempt from
future land use regulations until building permits have been properly issued and substantial work has been
performed and substantial liabilities have been incurred in good faith reliance on such permits.
Only a portion of the undeveloped land within the District has been final mapped and contains finished
lots with certain infrastructure in place (streets, curbs, gutters, street lighting, etc.). Development of certain
portions of the land within the District may be contingent upon construction or acquisition of additional public
improvements, as well as local public and private in -tract improvements. The cost of these additional public and
private in -tract and off -site improvements could increase the private debt for which the land within the District
provides security. Completion of development within the District as proposed and within the timeframe
indicated relies on Vista Canyon Ranch securing certain funding sources. As discussed in "VISTA CANYON
MASTER PLANNED COMMUNITY" and "DEVELOPMENT WITHIN THE DISTRICT" herein, Vista
Canyon Ranch anticipates that it will receive, but does not currently have, a dedicated source of financing in
place to complete the $6.5 million remaining First Phase Costs required to develop the First Phase Property
within the District. Additionally, Vista Canyon Ranch does not have financing in place to commence vertical
construction on property other than Lot 10. No assurance can be made that Vista Canyon Ranch or its affiliates
will be able to obtain financing for the remaining infrastructure or commence vertical construction. This
increased debt or difficulty or delay in obtaining funding sources could reduce the willingness and/or ability of
the property owners to pay the annual Special Taxes levied against their property.
Development of land is also subject to economic considerations such as the strength of the regional
economy. Another economic downturn, similar to the last U.S. recession, for example, could adversely impact
the demand for homes and land development operations generally throughout the area. There can be no
assurance that the means and incentive to conduct land development operations within the District will occur or
will not be adversely affected by future local, State and federal governmental policies relating to real estate
development, or the income tax treatment of real property ownership.
The inability or failure to develop property due to adverse regulatory or economic conditions may
reduce the value of undeveloped property. Undeveloped property also provides less security to the Bondowners
should it be necessary for the District to foreclose on such property due to the nonpayment of the Special Taxes.
Because of the current concentration of ownership of the undeveloped property in the District, the timely
payment of the 2020 Bonds depends upon the willingness and ability of the present owners of the undeveloped
property to pay the Special Taxes levied on the undeveloped property when due. See "SPECIAL RISK
FACTORS -- Concentration of Ownership" below.
Land Development Costs
Approximately 45% of the lien of the Special Tax is allocated to Undeveloped parcels. The cost of
additional improvements plus any further public and private in -tract, on -site and off -site improvements would
likely increase the public and private debt secured by the Undeveloped land within the District. See
APPENDIX G — "THE APPRAISAL REPORT" and "THE DISTRICT - Direct and Overlapping Debt and
Other Obligations." This increased debt could reduce the ability or desire of the property owners to pay the
annual Special Taxes levied against the property. In that event there could be a default in the payment of
principal of, and interest on, the 2020 Bonds.
Insufficiency of Special Taxes
Under the RMA, the annual amount of Special Tax to be levied on each taxable parcel will be based
primarily on whether such parcel is developed or not, and in which zone it is located. See "APPENDIX D --
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RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAXES" and "THE DISTRICT — Summary of
Rate and Method." Accordingly, to the extent property is not developed, collection of the Special Taxes will be
dependent on the willingness and ability of the owners of Undeveloped Property to pay such Special Taxes
when due. See "SPECIAL RISK FACTORS -- Failure to Develop Undeveloped Properties" below for a
discussion of the risks associated with undeveloped property.
Notwithstanding that the maximum Special Taxes that may be levied in the District exceeds debt service
due on the 2020 Bonds, the Special Taxes collected could be inadequate to make timely payment of debt service
either because of nonpayment or because property becomes exempt from taxation.
Furthermore, Administrative Expenses are paid by the District prior to the payment of debt service on
the 2020 Bonds. Incurrence of higher than budgeted Administrative Expenses may have an adverse impact on
the ability of the District to make debt service on the 2020 Bonds.
If for any reason property within the District becomes exempt from taxation by reason of ownership by
a non-taxable entity such as the federal government, another public agency or other organization determined to
be exempt, subject to the limitations of the maximum authorized rates, the Special Tax will be reallocated to the
remaining taxable properties within the District. This could result in certain owners of property paying a greater
amount of the Special Tax and could have an adverse impact upon the ability and willingness of the owners of
such property to pay the Special Tax when due.
The Act provides that, if any property within the District not otherwise exempt from the Special Tax is
acquired by a public entity through a negotiated transaction, or by gift or devise, the Special Tax will continue to
be levied on and enforceable against the public entity that acquired the property. In addition, the Act provides
that, if property subject to the Special Tax is acquired by a public entity through eminent domain proceedings,
the obligation to pay the Special Tax with respect to that property is to be treated as if it were a special
assessment and be paid from the eminent domain award. The constitutionality and operation of these provisions
of the Act have not been tested in the courts. Due to problems of collecting taxes from public agencies, if a
substantial portion of land within the District became exempt from the Special Tax because of public ownership,
or otherwise, the Maximum Special Taxes which could be levied upon the remaining property within those areas
might not be sufficient to pay principal of and interest on the 2020 Bonds when due and a default could occur
with respect to the payment of such principal and interest on the 2020 Bonds.
In certain circumstances, the District has covenanted to commence judicial foreclosure proceedings
against property with delinquent Special Taxes. No assurance can be given that any bid will be received for a
parcel with delinquent Special Taxes offered for sale at foreclosure or, if a bid is received, that such bid will be
sufficient to pay all delinquent Special Taxes.
Depletion of Reserve Account
A Reserve Account has been established and may be used to pay principal of and interest on the 2020
Bonds and any additional Series of Bonds if insufficient funds are available from the proceeds of the levy and
collection of the Special Taxes against property within the District. See "SECURITY FOR THE 2020 BONDS -
Reserve Account."
If funds within the Reserve Account are depleted, the funds can be replenished from the proceeds of the
levy and collection of the Special Tax that are in excess of the amount required to pay Administrative Expenses
and principal and interest on the 2020 Bonds under the Fiscal Agent Agreement. However, no replenishment
from the proceeds of a Special Tax levy can occur so long as the proceeds that are collected from the levy of the
Special Tax against property within the District at the maximum Special Tax rates (subject to the limitations of
the Act), together with other available funds, remain insufficient to pay all such amounts. Thus, it is possible
that the Reserve Account will be depleted and not be replenished by the levy of the Special Tax within the
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District. The Reserve Requirement is defined as 80% of maximum annual debt service. Debt service escalates
annually each year by 2%.
Natural Disasters
The value of the parcels in the District in the future can be adversely affected by a variety of natural
occurrences, particularly those that may affect infrastructure and other public improvements and private
improvements on the parcels in the District and the continued habitability and enjoyment of such private
improvements. The District, like all California communities, may be subject to unpredictable seismic activity,
fires due to the vegetation and topography, or flooding in the event of significant rainfall. The occurrence of
seismic activity, fires or flooding in or around the District could result in substantial damage to properties in the
District, which, in turn, could substantially reduce the value of such properties. As a result of the occurrence of
such an event, a substantial portion of the property owners may be unable or unwilling to pay the Special Taxes
when due. In addition, the value of land in the District could be diminished in the aftermath of such natural
events, reducing the resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the
Special Taxes.
Risk of Structural and Wildland Fire
The City contracts fire protection services from the Consolidated Fire Protection District of Los Angeles
County, otherwise known as the Los Angeles County Fire Department (the "Fire Department"). The City
receives urban and wildland fire protection services from the Fire Department. Mutual aid agreements are
maintained with several local, State, and federal agencies. According to information contained in the Safety
Element of the City's General Plan, historical records kept by the U.S. Department of Forestry indicate that
wildland fires occur regularly within the Santa Clanta Valley planning area, with large fires occurring
approximately every 10 years. Fire danger rises based on the age and amount of vegetation; therefore, fire
incidents tend to be cyclical in an area as vegetation intensity increases with age, and dead vegetation
accumulates. The Santa Clarita Valley planning area is susceptible to wildland fires because of its hilly terrain,
dry weather conditions, and native vegetation. Steep slopes allow for the quick spread of flames during fires,
and pose difficulty for fire suppression due to access problems for firefighting equipment. Late summer and fall
months are critical times of the year when wildland fires typically occur, when the Santa Ana winds deliver hot,
dry desert air into the region. Highly flammable plant communities consisting of variable mixtures of woody
shrubs and herbaceous species, such as chaparral and sage vegetation, allow fires to spread easily on hillsides
and in canyons. According to the Fire Department, 80 to 90 percent of the Santa Clarita Valley planning area is
located in a Very High Fire Hazard Severity Zone, which is the highest classification for areas subject to
wildfires. Areas subject to wildland fire danger include portions of Newhall and Canyon Country, Sand Canyon,
Pico Canyon, Placenta Canyon, Hasley Canyon, White's Canyon, Bouquet Canyon, and all areas along the
interface between urban development and natural vegetation in hillside areas. Fire hazards increase with any
drought periods, and are highest for structures at the fringe of forested or wildland areas. In addition to the
damage caused directly by a foothill fire, further damage may be caused by resulting mudslides during
subsequent rains. The Fire Department has adopted programs directed at wildland fire prevention, including
adoption of the State Fire Code standards for new development in hazardous fire areas. Fire prevention
requirements include provision of access roads, adequate road width, and clearance of brush around structures
located in hillside areas. Additionally, proof of adequate water supply for fire flow is required within a
designated distance for new construction in fire hazard areas.
The recent Tick Fire scorched over 4,600 acres in northeast Santa Clarita Valley and destroyed 29
structures and damaged another 44 structures. The Tick Fire had no direct impact on property within the
District.
The Thomas and Creek fires last year in Ventura County and Hill and Woosley fires in Los Angeles
County did not have a direct impact on the City. The Rye Canyon fire in December 2017 within the City did not
result in any damage to structures.
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In the event of damage to real property within District, the property owner could become unwilling to
pay its property tax bills, including Special Taxes.
Endangered and Threatened Species
On a regular basis, new species are proposed to be added to the State and federal protected species lists.
Any action by the State or federal governments to protect species located on or adjacent to the property within
the District could negatively affect the developers' ability to complete the development of the properties within
the District as planned. This, in turn, could reduce the ability or willingness of the property owners to pay the
Special Taxes when due and would likely reduce the value of the land and the potential revenues available at a
foreclosure sale for delinquent Special Taxes.
Hazardous Substances
A serious risk in terms of the potential reduction in the value of a parcel within the District is a claim
with regard to a hazardous substance. In general, the owners and operators of a parcel within the District may
be required by law to remedy conditions of such parcel relating to release or threatened releases of hazardous
substances. The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980,
sometimes referred to as "CERCLA" or the "Superfund Act," is the most well known and widely applicable of
these laws, but California laws with regard to hazardous substances are also similarly stringent. Under many of
these laws, the owner or operator is obligated to remedy a hazardous substance condition of the property
whether or not the owner or operator had anything to do with creating or handling the hazardous substance. The
effect, therefore, should any of the parcels within the District be affected by a hazardous substance, will be to
reduce the marketability and value of such parcel by the costs of remedying the condition, because the
prospective purchaser, upon becoming the owner, will become obligated to remedy the condition just as the
seller is.
Although the District is not aware that the owner or operator of any of the taxable parcels in the District
has such a current liability, it is possible that such liabilities do currently exist. Further, it is possible that
liabilities may arise in the future resulting from the existence, currently, on the parcel of a substance presently
classified as hazardous but that has not been released or the release of which is not presently threatened, or may
arise in the future resulting from the existence, currently on the parcel of a substance not presently classified as
hazardous but that may in the future be so classified. Further, such liabilities may arise not simply from the
existence of a hazardous substance but from the method of handling it. All of these possibilities could
significantly affect the property values that would otherwise be realized upon a delinquency.
No information is available as to the existence of any hazardous substances within the District.
Appraised Valuations; Value -to -Lien Ratios
The value of land within the District is an important factor in evaluating the investment quality of the
Bonds. In the event that a property owner defaults in the payment of Special Tax installments, the District's
only remedy is to judicially foreclose on that property. Prospective purchasers of the Bonds should not assume
that the property within the District could be sold for the appraised value described in this Official Statement at
a foreclosure sale for delinquent Special Tax installments or for an amount adequate to pay delinquent Special
Tax installments. Reductions in property values within the District due to a downturn in the economy or the real
estate market, events such as earthquakes, droughts, or floods, stricter land use regulations, threatened or
endangered species or other events may adversely impact the security underlying the Special Taxes.
The property values of property set forth in the various tables herein are the property values determined
by the Appraiser. The Appraisal was prepared for the purpose of estimating and confirming the minimum
market value of such property as of December 2, 2019 in its as is condition on the basis of certain assumptions.
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The Appraised values were not determined on a bulk sale basis, and value may be substantially less if all the
properties were subject to foreclosure at the same time.
Prospective purchasers of the 2020 Bonds should not assume, however, that such parcels could be sold
for the appraised amount described herein at the present time or at a foreclosure sale for delinquent Special
Taxes. See the Appraisal included as Appendix G hereto for a brief description of the analysis used and
assumptions made by the Appraiser. The actual value of the property is subject to future events that might
render invalid the assumptions relied upon by the Appraiser in determining the appraised value.
No assurance can be given that the estimated value -to -lien ratios as set forth in "THE DISTRICT —
Estimated Value -to -Lien Ratios" will be maintained over time. As discussed herein, many factors that are
beyond the control of the District could adversely affect the property values within the District. The District
does not have any control over the amount of additional indebtedness that may be issued by other public
agencies, including Sulphur Springs CFD, the payment of which through the levy of a tax or an assessment is on
a parity with the Special Taxes. A decrease in the assessed values in the District or an increase in the
indebtedness secured by taxes and amounts with parity liens on property in the District, or both, could result in a
lowering of the value -to -lien ratios of the property in the District. See "THE DISTRICT — Estimated Value -to -
Lien Ratios" herein.
No assurance can be given that any bid will be received for a parcel with delinquent Special Taxes
offered for sale at foreclosure or, if a bid is received, that such bid will be sufficient to pay all delinquent Special
Taxes. See "SECURITY AND SOURCES OF PAYMENT FOR THE BONDS —Covenant for Superior Court
Foreclosure."
Concentration of Ownership
Two principal property owners within the District are responsible for 100% of the annual Special Tax
levy
If these or any other future property owner is unwilling or unable to pay the Special Tax when due, a
potential shortfall in the Special Tax Fund could occur, which would result in the depletion of the Reserve
Account prior to reimbursement from the resale of foreclosed property or payment of the delinquent Special
Taxes and, consequently, a delay or failure in payments of the principal of or interest on the 2020 Bonds. No
property owner is obligated in any manner to continue to own or develop any of the land it presently owns
within the District. The Special Taxes are not a personal obligation of any owner of the parcels, and the District
can offer no assurance that any current owner or any future owner will be financially able to pay such Special
Taxes or that it will choose to pay even if financially able to do so.
Competition
The housing market and commercial/office market in the City has other pending and proposed projects
that may be competitive when the undeveloped land within the District is ready for development. This
competition could impact the future value of the undeveloped property and the rate at which property is
developed and absorbed.
Parity Taxes and Special Assessments
While the Special Taxes are secured by the taxable parcels in the District, the security only extends to
the value of such property that is not subject to priority and parity liens and similar claims.
Tables listing the outstanding governmental obligations affecting the District are set forth under "THE
DISTRICT - Direct and Overlapping Debt and Other Obligations."
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Apartment units within the District are subject to a special tax levied and collected by Sulphur Springs
CFD. For Fiscal Year 2019-20, the assigned tax that was levied is $557.45 per apartment unit. This special tax
contains an annual escalator of 2% per year. The Sulphur Springs CFD is authorized to issue up to $19.5
million of special tax bonds secured by the special tax revenues generated by such community facilities district.
Vista Canyon Ranch estimates that at full buildout of the Vista Canyon Project, the property within the District
will also bear approximately 42% of the total special taxes levied by Sulphur Springs CFD. The special taxes
levied by Sulphur Springs CFD are parity liens on any parcel of property taxed by both the District and Sulphur
Springs CFD.
In addition, other governmental obligations may be authorized and undertaken or issued in the future,
the tax, assessment or charge for which may become an obligation of one or more of the parcels within the
District, and may be secured by a lien on a parity with the lien of the Special Taxes securing the 2020 Bonds.
In general, the Special Taxes, and all other taxes, assessments and charges also collected on the tax roll,
are on a parity, that is, are of equal priority. Questions of priority become significant when collection of one or
more of the taxes, assessments or charges is sought by some other procedure, such as foreclosure and sale. If
proceedings are brought to foreclose a delinquency, the Special Taxes will generally be on parity with the other
taxes, assessments and charges, and will share the proceeds of such foreclosure proceedings on a pro-rata basis.
The Special Taxes have priority over all existing and future private liens imposed on the property
except, possibly, for liens or security interests held by the Federal Deposit Insurance Corporation. See
"SPECIAL RISK FACTORS — Bankruptcy and Foreclosure" below.
The District has no control over the ability of other entities and districts to issue indebtedness
secured by special taxes, ad valorem taxes or assessments payable from all or a portion of the property
within the District. Any such special taxes, ad valorem taxes or assessments may have a lien on such
property on a parity with the Special Taxes and could reduce the estimated value -to -lien ratios for
property within the District as described herein.
The properties within the District could be subject to annual Special Taxes for Services for the District.
Pursuant to the RMA, the Special Tax for Services will only be levied in a Fiscal Year if it is determined that a
property owner association is not maintaining the Cooper Street Parking Facility (anticipated to be completed as
of February 15, 2020) or the Vista Canyon Boulevard parking structure (to be constructed in the future). Neither
parking structure has been completed and turned over to the City, and it is required that they will be maintained
by a property owner association. Therefore, the Special Tax for Services has not yet been levied and is not
expected to be levied. See "THE DISTRICT - Direct and Overlapping Debt and Other Obligations."
Disclosures to Future Purchasers
The willingness or ability of an owner of a parcel to pay the Special Tax, even if the value of the parcel
is sufficient, may be affected by whether or not the owner was given due notice of the Special Tax authorization
at the time the owner purchased the parcel, was informed of the amount of the Special Tax on the parcel should
the Special Tax be levied at the maximum tax rate and the risk of such a levy, and, at the time of such a levy, has
the ability to pay it as well as pay other expenses and obligations. The District caused a Notice of Special Tax
lien to be recorded in the Office of the Recorder for the County against each parcel. While title companies
normally refer to such notices in title reports, there can be no guarantee that such reference will be made or, if
made, that a prospective purchaser or lender will consider such Special Tax obligation in the purchase of a
property within of the District or lending of money thereon.
The Act requires the subdivider (or its agent or representative) of a subdivision to notify a prospective
purchaser or long-term lessor of any lot, parcel, or unit subject to a Mello -Roos special tax of the existence and
maximum amount of such special tax using a statutorily prescribed form. California Civil Code Section 1102.6b
requires that in the case of transfers other than those covered by the above requirement, the seller must at least
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make a good faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by
statute. Failure by an owner of the property to comply with the above requirements, or failure by a purchaser or
lessor to consider or understand the nature and existence of the Special Tax, could adversely affect the
willingness and ability of the purchaser or lessor to pay the Special Tax when due.
Special Tax Delinquencies
Special Taxes are the primary source for the repayment of the 2020 Bonds, and delinquencies could
result in a draw on the Reserve Account and, if the Reserve Account were depleted, in a default in payment on
the 2020 Bonds.
Under provisions of the Act, the Special Taxes, from which funds necessary for the payment of
principal of, and interest on, the 2020 Bonds are derived, are customarily billed to the properties within the
District on the ad valorem property tax bills sent to owners of such properties. The Act currently provides that
such Special Tax installments are due and payable and are subject to the same lien priority in the case of
delinquency as are ad valorem property tax installments.
See "SECURITY FOR THE 2020 BONDS— Covenant for Superior Court Foreclosure," for a
discussion of the provisions which apply, and procedures which the District is obligated to follow under the
Fiscal Agent Agreement, in the event of delinquencies in the payment of Special Taxes. See "SPECIAL RISK
FACTORS — Bankruptcy and Foreclosure" below, for a discussion of the policy of the Federal Deposit
Insurance Corporation regarding the payment of special taxes and assessments and limitations on the District's
ability to foreclose on the lien of the Special Taxes in certain circumstances.
Non -Cash Payments of Special Taxes
Under the Act, the City Council as the legislative body of the District may reserve to itself the right and
authority to allow the owner of any taxable parcel to tender a 2020 Bond in full or partial payment of any
installment of the Special Taxes or the interest or penalties thereon. A 2020 Bond so tendered is to be accepted
at par and credit is to be given for any interest accrued thereon to the date of the tender. Thus, if 2020 Bonds
can be purchased in the secondary market at a discount, it may be to the advantage of an owner of a taxable
parcel to pay the Special Taxes applicable thereto by tendering a 2020 Bond. Such a practice would decrease
the cash flow available to the District to make payments with respect to other 2020 Bonds then outstanding; and,
unless the practice was limited by the District, the Special Taxes paid in cash could be insufficient to pay the
debt service due with respect to such other 2020 Bonds. In order to provide some protection against the
potential adverse impact on cash flows which might be caused by the tender of 2020 Bonds in payment of
Special Taxes, the Fiscal Agent Agreement includes a covenant pursuant to which the District will not sell a
2020 Bond to the owners of taxable parcels to satisfy Special Tax obligations by the tender of such 2020 Bond
unless the District shall have first obtained a report of an Independent Financial Consultant certifying that doing
so would not result in the District having insufficient funds to pay the principal of and interest on all
Outstanding Bonds when due.
Payment of the Special Tax is not a Personal Obligation of the Owners
An owner of a taxable parcel is not personally obligated to pay the Special Tax. Rather, the Special Tax
is an obligation which is secured only by a lien against the taxable parcel. If the value of a taxable parcel is not
sufficient, taking into account other liens imposed by public agencies, to secure fully the Special Tax, the
District has no recourse against the owner.
FDIC/Federal Government Interests in Properties
The ability of the District to collect interest and penalties specified by the Act and to foreclose the lien
of delinquent Special Taxes may be limited in certain respects with regard to parcels in which the FDIC, or other
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federal government entities such as Fannie Mae, Freddie Mac, the Drug Enforcement Agency, the Internal
Revenue Service or other federal agency, has or obtains an interest.
In the case of FDIC, in the event that any financial institution making a loan which is secured by parcels
is taken over by the FDIC and the applicable Special Tax is not paid, the remedies available to the District may
be constrained. The FDIC's policy statement regarding the payment of state and local real property taxes (the
"Policy Statement") provides that taxes other than ad valorem taxes which are secured by a valid lien in effect
before the FDIC acquired an interest in a property will be paid unless the FDIC determines that abandonment of
its interests is appropriate. The Policy Statement provides that the FDIC generally will not pay installments of
non -ad valorem taxes which are levied after the time the FDIC acquires its fee interest, nor will the FDIC
recognize the validity of any lien to secure payment except in certain cases where the Resolution Trust
Corporation had an interest in property on or prior to December 31, 1995. Moreover, the Policy Statement
provides that, with respect to parcels on which the FDIC holds a mortgage lien, the FDIC will not permit its lien
to be foreclosed out by a taxing authority without its specific consent, nor will the FDIC pay or recognize liens
for any penalties, fines or similar claims imposed for the non-payment of taxes.
The FDIC has taken a position similar to that expressed in the Policy Statement in legal proceedings
brought against Orange County in United States Bankruptcy Court and in Federal District Court. The
Bankruptcy Court issued a ruling in favor of the FDIC on certain of such claims. Orange County appealed that
ruling, and the FDIC cross -appealed. On August 28, 2001, the Ninth Circuit Court of Appeals issued a ruling
favorable to the FDIC except with respect to the payment of pre -receivership liens based upon delinquent
property tax.
The District is unable to predict what effect the application of the Policy Statement would have in the
event of a delinquency with respect to parcels in which the FDIC has or obtains an interest, although prohibiting
the lien of the FDIC to be foreclosed out at a judicial foreclosure sale would prevent or delay the foreclosure
sale.
In the event a parcel of taxable property or a private deed of trust secured by a parcel of taxable property
is owned by a federal government entity or federal government sponsored entity, such as Fannie Mae or Freddie
Mac, the ability to foreclose on the parcel or to collect delinquent Special Taxes may be limited. Federal courts
have held that, based on the supremacy clause of the United States Constitution, in the absence of Congressional
intent to the contrary, a state or local agency cannot foreclose to collect delinquent taxes or assessments if
foreclosure would impair the federal government interest. This means that, unless Congress has otherwise
provided, if a federal government entity owns a parcel of taxable property but does not pay taxes and
assessments levied on the parcel (including Special Taxes), the applicable state and local governments cannot
foreclose on the parcel to collect the delinquent taxes and assessments.
Moreover, unless Congress has otherwise provided, if the federal government has a mortgage interest in
a parcel and the District wishes to foreclose on that parcel as a result of delinquent Special Taxes, the property
cannot be sold at a foreclosure sale unless it can be sold for an amount sufficient to pay delinquent taxes and
assessments on a parity with the Special Taxes and preserve the federal government's mortgage interest. For a
discussion of risks associated with taxable parcels within the District becoming owned by the federal
government, federal government entities or federal government sponsored entities, see "— Insufficiency of
Special Taxes."
The District's remedies may also be limited in the case of delinquent Special Taxes with respect to
parcels in which other federal agencies (such as the Internal Revenue Service and the Drug Enforcement
Administration) have or obtain an interest.
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Bankruptcy and Foreclosure
Bankruptcy, insolvency and other laws generally affecting creditors' rights could adversely impact the
interests of Beneficial Owners of the 2020 Bonds. The payment of property owners' taxes and the ability of the
District to foreclose the lien of a delinquent unpaid Special Tax pursuant to its covenant to pursue judicial
foreclosure proceedings may be limited by bankruptcy, insolvency or other laws generally affecting creditors'
rights or by the laws of the State relating to judicial foreclosure. See "SECURITY FOR THE 2020 BONDS —
Covenant for Superior Court Foreclosure." In addition, the prosecution of a foreclosure could be delayed due to
many reasons, including crowded local court calendars or lengthy procedural delays.
Although a bankruptcy proceeding would not cause the Special Taxes to become extinguished, the
amount of any Special Tax lien could be modified if the value of the property falls below the value of the lien.
If the value of the property is less than the lien, such excess amount could be treated as an unsecured claim by
the bankruptcy court. In addition, bankruptcy of a property owner could result in a delay in prosecuting
Superior Court foreclosure proceedings. Such delay would increase the likelihood of a delay or default in
payment of delinquent Special Tax installments and the possibility of delinquent Special Tax installments not
being paid in full.
The various legal opinions to be delivered concurrently with the delivery of the 2020 Bonds (including
Bond Counsel's approving legal opinion) will be qualified, as to the enforceability of the various legal
instruments, by moratorium, bankruptcy, reorganization, insolvency or other similar laws affecting the rights of
creditors generally.
Moreover, the ability of the District to commence and prosecute enforcement proceedings may be
limited by bankruptcy, insolvency and other laws generally affecting creditors' rights and by the laws of the
State relating to judicial foreclosure.
No Acceleration Provision
The 2020 Bonds do not contain a provision allowing for the acceleration of the 2020 Bonds in the event
of a payment default or other default under the 2020 Bonds or the Fiscal Agent Agreement.
Potential Early Redemption From Special Tax Prepayments
Property owners within the District are permitted to prepay their Special Taxes at any time. Such
payments will result in a redemption of the 2020 Bonds on the Interest Payment Date for which timely notice
may be given under the Fiscal Agent Agreement following the receipt of the prepayment. The resulting
redemption of Bonds purchased at a price greater than par could reduce the otherwise expected yield on such
2020 Bonds. See "THE 2020 BONDS — Redemption" herein.
Loss of Tax Exemption
As discussed under the caption "TAX MATTERS — Tax Exemption," the interest on the 2020 Bonds
could become includable in gross income for federal income tax purposes retroactive to the date of issuance of
the 2020 Bonds as a result of a failure of the District to comply with certain provisions of the Internal Revenue
Code of 1986, as amended, or a change in legislation. Legislative changes have been proposed in Congress,
which, if enacted, would result in additional federal income tax being imposed on certain owners of tax-exempt
state or local obligations, such as the 2020 Bonds. The introduction or enactment of any of such changes could
adversely affect the market value or liquidity of the 2020 Bonds. Should such an event of taxability occur, the
2020 Bonds are not subject to early redemption and will remain outstanding to maturity or until redeemed under
the redemption provisions of the Fiscal Agent Agreement.
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Limitations on Remedies
Remedies available to the Beneficial Owners of the 2020 Bonds may be limited by a variety of factors
and may be inadequate to assure the timely payment of principal of and interest on the 2020 Bonds or to
preserve the tax-exempt status of the 2020 Bonds.
Bond Counsel has limited its opinion as to the enforceability of the 2020 Bonds and the Fiscal Agent
Agreement to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, fraudulent
conveyance or transfer, moratorium, or other similar laws affecting generally the enforcement of creditors'
rights, by equitable principles and by the exercise of judicial discretion. The lack of availability of certain
remedies or the limitation of remedies may entail risks of delay, limitation or modification of the rights of the
Beneficial Owners of the 2020 Bonds.
Transfer Restrictions
Prior to the Trigger Event Date, no transfer, sale or other disposition of any 2020 Bond, or any
beneficial interest therein, may be made except to an entity that the transferor reasonably believes is either (i) a
Qualified Institutional Buyer within the meaning of Rule 144A promulgated under the Securities Act of 1933
that is purchasing such 2020 Bond for its own account for investment purposes and not with a view to
distributing such 2020 Bond, or (ii) an Accredited Investor as defined in Section 501(a) of Regulation D
promulgated under the Securities Act of 1933 that is purchasing such 2020 Bond for its own account for
investment purposes and not with a view to distributing such 2020 Bond.
The 2020 Bonds will bear a legend describing or referencing the restrictions on transferability set forth
in the Fiscal Agent Agreement.
Each entity which is or who becomes a Beneficial Owner of a 2020 Bond prior to the Trigger Event
Date will be deemed by the acceptance or acquisition of such beneficial ownership interest to have agreed to be
bound by the transfer restrictions provisions of the Fiscal Agent Agreement. The transferor of a 2020 Bond
prior to the Trigger Event Date will be deemed to have agreed to provide notice to any proposed assignee of a
beneficial ownership interest in the purchased 2020 Bond of the restrictions on transfer described herein. Any
Owner or Beneficial Owner effecting a transfer, sale or other disposition of a 2020 Bond, or beneficial interest
therein, will be deemed to have agreed to indemnify the District, the City and the Fiscal Agent against any
liability that may result if such transfer, sale or other disposition is not made in accordance with the Fiscal Agent
Agreement.
The restrictions on transfer of the 2020 Bonds described above will no longer be applicable to transfers
of the 2020 Bonds or any beneficial interest therein if the Trigger Event Date occurs. See "THE 2020 BONDS
— Transfer Restrictions."
No Ratings and Limited Secondary Market
The District has not applied to have the 2020 Bonds rated by any nationally recognized bond rating
company and it does not expect to do so in the future. INVESTMENT IN THE 2020 BONDS IS
SPECULATIVE IN NATURE AND INVOLVES A DEGREE OF RISK. When any Owner attempts to resell
its 2020 Bonds, this absence of a rating could adversely affect the market price and marketability thereof.
Although the Underwriter intends, but is not obligated, to make a market for the 2020 Bonds, there can be no
assurance that there will be a secondary market for the 2020 Bonds, and the absence of such a market for the
2020 Bonds could result in investors not being able to resell the 2020 Bonds should they need to do so, or wish
to do so. The 2020 Bonds are only being offered in authorized denominations of $100,000 or any integral
multiple of $5,000 in excess thereof until such time as the Trigger Event Date occurs at which time the
authorized denomination of the 2020 Bonds will automatically convert to $5,000 or any integral multiple
thereof. Investors should be capable of bearing the economic risks of the purchase of the 2020 Bonds and
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having such knowledge and experience in business and financial matters as to be capable of evaluating the
merits and risks of an investment in the 2020 Bonds.
Although the District has committed to provide certain financial and operating information on an annual
basis, there can be no assurance that such information will be available to Beneficial Owners on a timely basis.
See "CONTINUING DISCLOSURE." The failure to provide the required annual financial information does not
give rise to monetary damages but merely an action for specific performance. Occasionally, because of general
market conditions, lack of current information, or because of adverse history or economic prospects connected
with a particular issue, secondary marketing practices in connection with a particular issue are suspended or
terminated. Additionally, prices of issues for which a market is being made will depend upon then prevailing
circumstances. Such prices could be substantially different from the original purchase price.
Validity of Landowner Elections
On August 1, 2014, the California Court of Appeal, Fourth Appellate District, Division One (the
"Court"), issued its opinion in City of San Diego v. Melvin Shapiro, et al. (D063997). The Court of Appeal
considered whether Propositions 13 and 218, which amended the California Constitution to require voter
approval of taxes, require registered voters to approve a tax or whether a city could limit the qualified voters to
just the landowners and lessees paying the tax. The case involved a Convention Center Facilities District (the
"CCFD") established by the City of San Diego. The CCFD is a financing district established under San Diego's
charter and was intended to function much like a community facilities district established under the provisions
of the Act. The CCFD is comprised of the entire city of San Diego. However, the special tax to be levied
within the CCFD was to be levied only on properties improved with a hotel located within the CCFD.
At the election to authorize such special tax, the San Diego Charter proceeding limited the electorate to
owners of hotel properties and lessees of real property owned by a governmental entity on which a hotel is
located. Thus, the election was an election limited to landowners and lessees of properties on which the special
tax would be levied, and not a registered voter election. Such approach to determining who would constitute the
qualified electors of the CCFD was based on Section 53326(c) of the Act, which generally provides that, if a
special tax will not be apportioned in any tax year on residential property, the legislative body may provide that
the vote shall be by the landowners of the proposed district whose property would be subject to the special tax.
In addition, Section 53326(b) of the Act provides that if there are less than 12 registered voters in the district, the
landowners shall vote.
The Court held that the CCFD special tax election did not comply with applicable requirements of
Proposition 13, which added Article XIII A to the California Constitution (which states "Cities, Counties and
special districts, by a two-thirds vote of the qualified electors of such district, may impose special taxes on such
district") and Proposition 218, which added Article XIII C and XIIID to the California Constitution (which
provides "No local government may impose, extend or increase any special tax unless and until that tax is
submitted to the electorate and approved by a two-thirds vote"), or with applicable provisions of San Diego's
Charter, because the electors in such an election were not the registered voters residing within such district.
San Diego argued that the State Constitution does not expressly define the qualified voters for a tax;
however, the Legislature defined qualified voters to include landowners in the Act. The Court of Appeal rejected
San Diego's argument, reasoning that the text and history of Propositions 13 and 218 clearly show California
voters intended to limit the taxing powers of local government. The Court was unwilling to defer to the Act as
legal authority to provide local governments more flexibility in complying with the State's constitutional
requirement to obtain voter approval for taxes. The Court held that the tax was invalid because the registered
voters of San Diego did not approve it. However, the Court expressly stated that it was not addressing the
validity of landowners voting to impose special taxes pursuant to the Act in situations where there are fewer
than 12 registered voters. In the case of the CCFD, at the time of the election there were several hundred
thousand registered voters within the CCFD (i.e., all of the registered voters in the city of San Diego). In the
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case of the District, there were fewer than 12 registered voters within the District at the time of the election to
authorize the District special tax.
Moreover, Section 53341 of Act provides that any "action or proceeding to attack, review, set aside,
void or annul the levy of a special tax ... shall be commenced within 30 days after the special tax is approved by
the voters." Similarly, Section 53359 of the Act provides that any action to determine the validity of bonds
issued pursuant to the Act or the levy of special taxes authorized pursuant to the Act be brought within 30 days
of the voters approving the issuance of such bonds or the special tax. Voters approved the special tax and the
issuance of bonds for the District pursuant to the requirements of the Act on April 12, 2016. In the opinion of
Bond Counsel, under the provisions of Section 53341 and Section 53359 of the Act, the statute of limitations
period to challenge the validity of the special tax has expired.
Ballot Initiatives
Under the California Constitution, the power of initiative is reserved to the voters for the purpose of
enacting statutes and constitutional amendments. Since 1978, the voters have exercised this power through the
adoption of Proposition 13 and similar measures, including Proposition 218, which was approved in the general
election held on November 5, 1996, and Proposition 26, which was approved on November 2, 2010.
Any such initiative may affect the collection of fees, taxes and other types of revenue by local agencies
such as the City and the District. Subject to overriding federal constitutional principles, such collection may be
materially and adversely affected by voter -approved initiatives, possibly to the extent of creating cash -flow
problems in the payment of outstanding obligations such as the Bonds.
Proposition 218-Voter Approval for Local Government Taxes -Limitation on Fees, Assessments, and
Charges -Initiative Constitutional Amendment, added Articles XIIIC and XIIID to the California Constitution,
imposing certain vote requirements and other limitations on the imposition of new or increased taxes,
assessments and property -related fees and charges.
On November 2, 2010, California voters approved Proposition 26, entitled the "Supermajority Vote to
Pass New Taxes and Fees Act." Section 1 of Proposition 26 declares that Proposition 26 is intended to limit the
ability of the State Legislature and local government to circumvent existing restrictions on increasing taxes by
defining the new or expanded taxes as "fees." Proposition 26 amended Articles XIIIA and XIIIC of the State
Constitution. The amendments to Article XIIIA limit the ability of the State Legislature to impose higher taxes
(as defined in Proposition 26) without a two-thirds vote of the Legislature. Article XIIIC requires that all new
local taxes be submitted to the electorate before they become effective. Taxes for general governmental
purposes require a majority vote and taxes for specific purposes ("special taxes") require a two-thirds vote.
The Special Taxes and the Bonds were each authorized by not less than a two-thirds vote of the
landowners within the District who constituted the qualified electors at the time of such voted authorization. The
District believes, therefore, that issuance of the Bonds does not require the conduct of further proceedings under
the Act, Proposition 218 or Proposition 26.
Like their antecedents, Proposition 218 and Proposition 26 are likely to undergo both judicial and
legislative scrutiny before the impact on the District can be determined. Certain provisions of Proposition 218
and Proposition 26 may be examined by the courts for their constitutionality under both State and federal
constitutional law, the outcome of which cannot be predicted.
From time to time, other initiative measures could be adopted by California voters. The adoption of any
such initiative might place limitations on the ability of the State, the City, or local districts to increase revenues
or to increase appropriations. See "SPECIAL RISK FACTORS — Risks of Real Estate Secured Investments
Generally" herein.
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CONTINUING DISCLOSURE
District Continuing Disclosure
Pursuant to the District Continuing Disclosure Certificate, the District has agreed to provide, or cause to
be provided, to the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board,
which can be found on the Internet at www.emma.msrb.org ("EMMA") on an annual basis, commencing March
31, 2020, certain financial information and operating data concerning the District. The District has further
agreed to provide notice to EMMA of certain listed events. The specific nature of the information to be provided
annually or the notice of material events is set forth in APPENDIX F — "FORMS OF CONTINUING
DISCLOSURE CERTIFICATES." The District's covenants have been made in order to assist the Underwriter
in complying with Rule 15c2-12 adopted by the Securities and Exchange Commission.
The District has not previously entered into any undertaking with respect to Rule 15c2-12. However, the
City and its related governmental entities - specifically those entities (such as the former Redevelopment
Agency of the City) (the "City Entities") for whom City staff is responsible for undertaking compliance with
continuing disclosure undertakings - have previously entered into numerous disclosure undertakings under the
Rule in connection with the issuance of long-term obligations.
In conjunction with the delivery of the 2020 Bonds, the City engaged the services of Digital Assurance
Certification LLC ("DAC") to conduct a continuing disclosure compliance review with respect to the above -
referenced bond issues. During the course of DAC's review, it was determined that during the past five years,
there were a handful of instances of non-compliance by the City and City Entities with the requirements of
certain undertakings due primarily to the City failing to provide unaudited financial information when the
audited financial statements (AFS) were not yet available, and failing to timely link AFS already filed for one
bond issue with all applicable bond issues. Specifically:
1. With respect to the $16,485,000 City of Santa Clarita Community Facilities District No. 2002-1
(Valencia Town Center) Special Tax Bonds, Series 2012, the City for the Fiscal Year 2015 was
late in filing the AFS by 14 days, due to the failure to file the unaudited versions of the AFS
when the audited version was unavailable prior to the applicable deadline. The City did not file
in a timely manner notice of late annual financial information; and
2. With respect to the $29,860,000 Redevelopment Agency of the City of Santa Clarita Tax
Allocation Bonds (Newhall Redevelopment Project Area), Series 2008, the Successor Agency
for the Redevelopment Agency of City of Santa Clarita for Fiscal Year 2015 was late in filing
the AFS by 22 days, due to the failure to cross reference the AFS filed for the $8,850,000
Redevelopment Agency of the City of Santa Clarita Housing Set -Aside Tax Allocation Bonds,
Series 2008, prior to the applicable deadline. The Successor Agency did not file in a timely
manner notice of late annual financial information.
The City undertook a review of its adopted Fiscal Policies and has revised its Fiscal Policies to include a
formal continuing disclosure policy that will help assure compliance with existing and future continuing
disclosure undertakings (including those for related entities) through creation of a disclosure practices working
group including a City staff disclosure coordinator. The City believes that its procedures with the Dissemination
Agent will be sufficient in the normal due course to assure substantial compliance with its continuing disclosure
undertakings in the future, including the Continuing Disclosure Certificate with respect to the 2020 Bonds.
Landowner Continuing Disclosure
Vista Canyon Ranch. Pursuant to a continuing disclosure certificate (the "Vista Canyon Continuing
Disclosure Certificate"), Vista Canyon Ranch has covenanted for the benefit of the beneficial owners of the
2020 Bonds to provide certain information relating to Vista Canyon Ranch and its affiliates, its development
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plan and its financing plan (the "Vista Canyon Disclosure Report"), and to provide notices of the occurrence of
certain enumerated events, until Vista Canyon Ranch's obligation to so provide such information, data and
notices is otherwise terminated in accordance with the provisions of the Vista Canyon Continuing Disclosure
Certificate. A form of the Vista Canyon Continuing Disclosure Certificate is included in APPENDIX F —
"FORMS OF CONTINUING DISCLOSURE CERTIFICATES." The Vista Canyon Disclosure Reports are to
be filed by Vista Canyon Ranch with EMMA. Vista Canyon Ranch is not an obligated person under the Rule,
but Vista Canyon Ranch has voluntarily agreed to enter into the Vista Canyon Continuing Disclosure Certificate
in order to assist the Underwriter in complying with the Rule.
This is the first continuing disclosure undertaking for Vista Canyon Ranch.
Jefferson. Pursuant to a continuing disclosure certificate (the "Jefferson Continuing Disclosure
Certificate"), Jefferson has covenanted for the benefit of the beneficial owners of the 2020 Bonds to provide
certain information relating to Jefferson and its affiliates, its development plan and its financing plan (the
"Jefferson Disclosure Report"), and to provide notices of the occurrence of certain enumerated events, until
Jefferson's obligation to so provide such information, data and notices is otherwise terminated in accordance
with the provisions of the Jefferson Continuing Disclosure Certificate. A form of the Jefferson Continuing
Disclosure Certificate is included in APPENDIX F — "FORMS OF CONTINUING DISCLOSURE
CERTIFICATES." The Jefferson Disclosure Reports are to be filed with EMMA. Jefferson is not an obligated
person under the Rule, but Jefferson has voluntarily agreed to enter into the Jefferson Continuing Disclosure
Certificate in order to assist the Underwriter in complying with the Rule.
This is the first continuing disclosure undertaking for Jefferson [to be verified].
Neither the District nor the City has considered, or reached any conclusion as to, whether or not the
property owner is an obligated person under Rule 15c2-12 and takes no responsibility for any such conclusion.
The District and the City take no responsibility for the form or content or for the adequacy of the landowner
Continuing Disclosure Certificates for their intended purpose. None of the District, the City or the Fiscal Agent
Agreement is a party to the landowner Continuing Disclosure Certificates, and none of the District, the City or
the Fiscal Agent has any obligation or responsibility to monitor, nor any right or obligation to enforce,
compliance by the landowner with its undertaking pursuant to the landowner Continuing Disclosure Certificates,
and none of the District, the City or the Fiscal Agent will be so monitoring or enforcing such compliance.
TAX MATTERS
Tax Exemption
The Internal Revenue Code of 1986 (the "Code") imposes certain requirements that must be met
subsequent to the issuance and delivery of the 2020 Bonds for interest thereon to be and remain excluded
pursuant to section 103(a) of the Code from the gross income of the owners thereof for federal income tax
purposes. Noncompliance with such requirements could cause the interest on the 2020 Bonds to be included in
the gross income of the owners thereof for federal income tax purposes retroactive to the date of issuance of the
2020 Bonds. The District has covenanted to maintain the exclusion of the interest on the 2020 Bonds from the
gross income of the owners thereof for federal income tax purposes.
In the opinion of Norton Rose Fulbright US LLP, Los Angeles, California, Bond Counsel, under
existing law, interest on the 2020 Bonds is exempt from personal income taxes of the State of California and,
assuming compliance with the covenants mentioned herein, interest on the 2020 Bonds is excluded pursuant to
section 103(a) of the Code from the gross income of the owners thereof for federal income tax purposes. It is
the further opinion of Bond Counsel that under existing law, the 2020 Bonds are not "specified private activity
bonds" within the meaning of section 57(a)(5) of the Code and for that reason that interest on the 2020 Bonds
will not be treated as an item of tax preference for purposes of computing the alternative minimum tax imposed
by section 55 of the Code.
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Pursuant to the Fiscal Agent Agreement and in the Tax Certificate Pertaining to Arbitrage and Other
Matters under Sections 103 and 141-1 SO of the Internal Revenue Code of 1986, to be delivered by the District in
connection with the issuance of the 2020 Bonds, the District will make representations relevant to the
determination of, and will make certain covenants regarding or affecting, the exclusion of interest on the 2020
Bonds from the gross income of the owners thereof for federal income tax purposes. In reaching its opinions
described in the immediately preceding paragraph, Bond Counsel will assume the accuracy of such
representations and the present and future compliance by the District with its covenants.
Except as stated in this section above, Bond Counsel will express no opinion as to any federal or state
tax consequence of the receipt of interest on, or the ownership or disposition of, the 2020 Bonds. Furthermore,
Bond Counsel will express no opinion as to any federal, state or local tax law consequence with respect to the
2020 Bonds, or the interest thereon, if any action is taken or not taken based upon the advice or approval of
other counsel. Bond Counsel has not undertaken to advise in the future whether any event after the date of
issuance of the 2020 Bonds may affect the tax status of interest on the 2020 Bonds or the tax consequences of
the ownership of the 2020 Bonds.
Bond Counsel's opinion is not a guarantee of a result, but represents its legal judgment based upon its
review of existing statutes, regulations, published rulings and court decisions and the representations and
covenants of the District described above. No ruling has been sought from the Internal Revenue Service (the
"Service") with respect to the matters addressed in the opinion of Bond Counsel, and Bond Counsel's opinion is
not binding on the Service. The Service has an ongoing program of auditing the tax-exempt status of the interest
on municipal obligations. If an audit of the 2020 Bonds is commenced, under current procedures the Service is
likely to treat the District as the "taxpayer", and the owners would have no right to participate in the audit
process. In responding to or defending an audit of the tax-exempt status of the interest on the 2020 Bonds, the
District may have different or conflicting interest from the owners. Public awareness of any future audit of the
2020 Bonds could adversely affect the value and liquidity of the 2020 Bonds during the pendency of the audit,
regardless of its ultimate outcome.
Existing law may change to reduce or eliminate the benefit to bondholders of the exclusion of interest
on the 2020 Bonds from personal income taxation by the State of California or from gross income for federal
income tax purposes. Any proposed legislation or administrative action, whether or not taken, could also affect
the value and marketability of the 2020 Bonds. Prospective purchasers of the 2020 Bonds should consult with
their own tax advisors with respect to any proposed or future changes in tax law.
A copy of the form of opinion of Bond Counsel relating to the 2020 Bonds is included in APPENDIX
Tax Accounting Treatment of Bond Premium and Original Issue Discount on 2020 Bonds
To the extent that a purchaser of a 2020 Bond acquires that 2020 Bond at a price in excess of its "stated
redemption price at maturity" (within the meaning of section 1273(a)(2) of the Code), such excess will
constitute "bond premium" under the Code. Section 171 of the Code, and the Treasury Regulations
promulgated thereunder, provide generally that bond premium on a tax-exempt obligation must be amortized
over the remaining term of the obligation (or a shorter period in the case of certain callable obligations); the
amount of premium so amortized will reduce the owner's basis in such obligation for federal income tax
purposes, but such amortized premium will not be deductible for federal income tax purposes. Such reduction
in basis will increase the amount of any gain (or decrease the amount of any loss) to be recognized for federal
income tax purposes upon a sale or other taxable disposition of the obligation. The amount of premium that is
amortizable each year by a purchaser is determined by using such purchaser's yield to maturity. The rate and
timing of the amortization of the bond premium and the corresponding basis reduction may result in an owner
realizing a taxable gain when its 2020 Bond is sold or disposed of for an amount equal to or in some
circumstances even less than the original cost of the 2020 Bond to the owner.
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The excess, if any, of the stated redemption price at maturity of 2020 Bonds of a maturity over the
initial offering price to the public of the 2020 Bonds of that maturity (the first price at which a substantial
amount of such maturity is sold to the public) is "original issue discount." Original issue discount accruing on a
2020 Bond is treated as interest excluded from the gross income of the owner thereof for federal income tax
purposes and is exempt from California personal income tax to the same extent as would be stated interest on
that 2020 Bond. Original issue discount on any 2020 Bond purchased at such initial offering price and pursuant
to such initial offering will accrue on a semiannual basis over the term of the 2020 Bond on the basis of a
constant yield method and, within each semiannual period, will accrue on a ratable daily basis. The amount of
original issue discount on such a 2020 Bond accruing during each period is added to the adjusted basis of such
2020 Bond to determine taxable gain upon disposition (including sale, redemption or payment on maturity) of
such 2020 Bond. The Code includes certain provisions relating to the accrual of original issue discount in the
case of purchasers of 2020 Bonds who purchase such 2020 Bonds other than at the initial offering price and
pursuant to the initial offering.
Persons considering the purchase of 2020 Bonds with original issue discount or initial bond premium
should consult with their own tax advisors with respect to the determination of original issue discount or
amortizable bond premium on such 2020 Bonds for federal income tax purposes and with respect to the state
and local tax consequences of owning and disposing of such 2020 Bonds. Bond Counsel will express no
opinion regarding such determination or such tax consequences.
Other Federal Income Tax Consequences
Although interest on the 2020 Bonds may be exempt from California personal income tax and excluded
from the gross income of the owners thereof for federal income tax purposes, an owner's federal, state or local
tax liability may be otherwise affected by the ownership or disposition of the 2020 Bonds. The nature and
extent of these other tax consequences will depend, inter alia, upon the owner's other items of income or
deduction. Without limiting the generality of the foregoing, prospective purchasers of the 2020 Bonds should be
aware that (i) section 265 of the Code denies a deduction for interest on indebtedness incurred or continued to
purchase or carry the 2020 Bonds and the Code contains additional limitations on interest deductions applicable
to financial institutions that own tax-exempt obligations (such as the 2020 Bonds), (ii) with respect to insurance
companies subject to the tax imposed by section 831 of the Code, section 832(b)(5)(B)(1) reduces the deduction
for loss reserves by 15% of the sum of certain items, including interest on the 2020 Bonds, (iii) interest on the
2020 Bonds earned by certain foreign corporations doing business in the United States could be subject to a
branch profits tax imposed by section 884 of the Code, (iv) passive investment income, including interest on the
2020 Bonds, may be subject to federal income taxation under section 1375 of the Code for Subchapter S
corporations that have Subchapter C earnings and profits at the close of the taxable year if greater than 25% of
the gross receipts of such Subchapter S corporation is passive investment income, (v) section 86 of the Code
requires recipients of certain Social Security and certain Railroad Retirement benefits to take into account, in
determining the taxability of such benefits, receipts or accruals of interest on the 2020 Bonds and (vi) under
section 32(1) of the Code, receipt of investment income, including interest on the 2020 Bonds, may disqualify
the recipient thereof from obtaining the earned income credit. Bond Counsel will express no opinion regarding
any such other tax consequence.
CONCLUDING INFORMATION
Absence of Material Litigation
There is no controversy of any nature now pending against and notice of which has been received by the
City or the District or, to the best knowledge of their respective officers, threatened, seeking to restrain or enjoin
the issuance, sale, execution or delivery of the 2020 Bonds or in any way contesting or affecting the validity of
the 2020 Bonds or any proceedings of the District taken with respect to the issuance or sale thereof or the pledge
or application of any moneys or security provided for the payment of the 2020 Bonds or the use of the 2020
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Bond proceeds. There are no pending lawsuits against and notice of which has been received by the City or the
District that challenge the validity of the 2020 Bonds, the corporate existence of the City or the District, or the
title of the officers thereof to their respective offices.
Approval of Legality
The proceedings in connection with the issuance of the 2020 Bonds are subject to the approval as to
their legality by Norton Rose Fulbright US LLP, Los Angeles, California, Bond Counsel for the District. Bond
Counsel undertakes no responsibility for the accuracy, completeness or fairness of the information contained in
this Official Statement. The legal opinion relates only to the legality of the Bonds and is not intended to be, nor
is it to be interpreted or relied upon, as a disclosure document or an express or implied recommendation as to the
investment quality of the 2020 Bonds. A copy of the proposed form of Bond Counsel's final approving opinion
with respect to the 2020 Bonds is attached hereto as APPENDIX B. Fees payable to Bond Counsel are
contingent on the successful sale and delivery of the 2020 Bonds.
Certain legal matters will be passed on for the District and for the City by Burke Williams & Sorensen
LLP, Los Angeles, California, City Attorney, and by Norton Rose Fulbright US LLP, Los Angeles, California,
Disclosure Counsel.
No General Obligation of City or District
The 2020 Bonds are not general obligations of the City or the District, but are limited obligations of the
District payable solely from the Special Taxes and certain amounts held under the Fiscal Agent Agreement. Any
tax for the payment of the Bonds shall be limited to the Special Taxes to be collected within the jurisdiction of
the District.
The Municipal Advisor
The District has retained Columbia Capital Management, LLC, Glendale, California (the "Municipal
Advisor"), as municipal advisor in connection with the authorization, issuance, sale and delivery of the 2020
Bonds. The Municipal Advisor is a registered Municipal Advisor (as defined in Section 15B of the Securities
Exchange Act of 1934, as amended) and has acted as municipal advisor to the District concerning the 2020
Bonds. The Municipal Advisor is not obligated to undertake, and has not undertaken to make, an independent
verification or to assume responsibility for the accuracy, completeness or fairness of the information contained
in the Official Statement or any of the other legal documents. Fees paid to the Municipal Advisor are contingent
upon the sale and delivery of the 2020 Bonds.
No Ratings on the 2020 Bonds
The District has not made, and does not contemplate making, any application for a rating on the 2020
Bonds. No such rating should be assumed based upon any other District rating that may be obtained. Prospective
purchasers of the 2020 Bonds are required to make independent determinations as to the credit quality of the
2020 Bonds and their appropriateness as an investment. Should a Bondowner elect to sell a 2020 Bond prior to
maturity, no representations or assurances can be made that a market will have been established or maintained
for the purchase and sale of the 2020 Bonds. The Underwriter assumes no obligation to establish or maintain
such a market and is not obligated to repurchase any of the 2020 Bonds at the request of the owner thereof.
Underwriting
The 2020 Bonds are being purchased by Stifel Nicolaus & Co, Inc. (the "Underwriter") at a purchase
price of $ (equal to the par amount of the 2020 Bonds being issued less an Underwriter's
discount of $ plus/less a net original issue premium/discount of $ ) pursuant to a
bond purchase agreement between the District and the Underwriter (the "Purchase Agreement"). The Purchase
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Agreement provides that the Underwriter will purchase all of the 2020 Bonds if any are purchased, the
obligation to make such purchase, if made, being subject to certain terms and conditions set forth in the
Purchase Agreement, the approval of certain legal matters and certain other conditions.
The Underwriter may offer and sell 2020 Bonds to certain dealers and others at a price other than the
offering price. The offering price may be changed from time to time by the Underwriter.
Miscellaneous
All of the preceding summaries of the Fiscal Agent Agreement, other applicable legislation, agreements
and other documents are made subject to the provisions of such documents and do not purport to be complete
statements of any or all of such provisions. Reference is hereby made to such documents on file with the City
for further information in connection therewith.
This Official Statement does not constitute a contract with the purchasers of the 2020 Bonds.
Any statements made in this Official Statement involving matters of opinion or of estimates, whether or
not so expressly stated, are set forth as such and not as representations of fact, and no representation is made that
any of the estimates will be realized.
The execution and delivery of this Official Statement by the City Manager of the City has been duly
authorized by the City on behalf of the City of Santa Clarita Community Facilities District No. 2016-1 (Vista
Canyon).
CITY OF SANTA CLARITA
COMMUNITY FACILITIES DISTRICT NO. 2016-1
(Vista Canyon)
City Manager of the City of Santa Clarita, California, acting
on behalf of the City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon)
72
APPENDIX A
GENERAL INFORMATION ABOUT THE CITY OF SANTA CLARITA
AND THE COUNTY OF LOS ANGELES
The following information concerning the City of Santa Clarita and the County of Los Angeles is
presented as general background data. The Bonds are payable solely from the Special Taxes and other
sources described herein (see "SECURITY FOR THE BONDS'). The taxing power of the City of Santa
Clarita, the County of Los Angeles, the State of California or any political subdivision thereof is not pledged
to the payment of the Bonds. See the information under the caption "THE BONDS. "
General Background
The City is located between the Santa Susana and San Gabriel mountain ranges approximately 35 miles
northwest from the City of Los Angeles. The City encompasses 66 square miles and is comprised of the
communities of Canyon Country, Newhall, Saugus, and Valencia, all located in Los Angeles County (the
"County"). The following information specifically relates to the City and generally to the Santa Clarita Valley
(the "Valley").
The first discovery of gold in 1842 was the beginning of a transformation of the area of the City, where
the once -ancient Alliklik Indians, wild horses, Spanish explorers and European colonists lived. After purchasing
Rancho San Francisco (later known as Newhall Ranch) in 1875, Henry Mayo sold a right-of-way to the
Southern Pacific Railroad for $1 and a town site known as Newhall for another $1. Not only did it become a rail
center, but the first commercially producing oil well began operation in Pico Canyon in 1875, followed by the
state's first oil refinery in Railroad Canyon.
The City was officially incorporated on December 15, 1987, after a ballot measure was passed by the
City's residents. The City is a general law city and operates under a Council -Manager form of government and
provides, either directly or under contract with the County, a full range of municipal services including public
safety, public works (including the sewer system), parks and recreation, community development, public
libraries and cultural events.
Geography and Climate
Santa Clarita Valley is located 35 miles northwest of Los Angeles and 40 miles east of the Pacific
Ocean. It covers 150 square miles and forms an inverted triangle with the San Gabriel and Santa Susana
mountain ranges, separating it from the San Fernando Valley and the Los Angeles Basin on the south, and the
San Joaquin Valley, Mojave Desert and Angeles National Forest to the north. The Santa Clara River and its
tributaries drain over 490,000 acres of mountains and canyons forming Santa Clarita Valley.
The City of Santa Clarita covers approximately 66 square miles and is located 40 miles from Los
Angeles International Airport, 25 miles from the Burbank Airport; and 50 to 60 miles from the ports of Los
Angeles and Long Beach, respectively. The City is accessible via Highway 126, the Golden State and the
Antelope Valley Freeways. Three Metrolink stations serve rail passengers from the San Fernando Valley and
Downtown Los Angeles.
In general, the climate in the City is sunny, warm and dry in the summer and semi -moist and mild in the
winters. The annual rainfall of 15 to 18 inches occurs primarily between November and March.
A-1
Municipal Government
The City provides general government services either with its own employees or through contracts. The
City has a Council Manager form of municipal government. The City Council appoints the City Manager who
is responsible for the day-to-day administration of City business and the coordination of all departments. The
City Council is composed of five members elected biannually at large to four-year staggered terms. The Mayor
is selected by the City Council from among its members. Beginning in 2016, the City's General Municipal
Election was consolidated with Los Angeles County General Election held on November 8, 2016. As of July 1,
2019, the City had a staff of 450.35 funded equivalent full time positions. The current members of the City
Council, term expiration and their principal occupations are as follows:
City Council Term Expires Occupation
Cameron Smyth, Mayor November 2020 Associate Vice President — State Affairs
William Miranda, Mayor Pro Tem November 2022 Business Consultant
Robert C. Kellar, Councilmember November 2020 Retired Police Officer/Realtor
Laurene F. Weste, Councilmember November 2022 Community Advocate
Marsha A. McLean, Councilmember November 2022 Business Owner
Current City Management Staff includes the following:
Mr. Ken Striplin has been the City Manager for the City since January 1, 2013. He has worked for the
City since 1995, serving in a leadership capacity in every City department during his tenure. Previously Mr.
Striplin has served the City as Assistant City Manager, Assistant to the City Manager, Technology Services
Manager, Management Analyst and Administrative Analyst. In addition, Mr. Striplin has served as Interim
Director of two departments: Field Services and Planning and Economic Development. He holds Bachelor of
Arts and Master of Public Administration degrees from California State University, Northridge, and a Doctor of
Education in Organizational Leadership from Pepperdine University.
Mr. Frank Oviedo has been the Assistant City Manager since January 7, 2013. Mr. Oviedo brings over
15 years of experience in city government. Prior to joining the City, he was the Deputy City Manager for the
City of Elk Grove from 2002-2009 and was the City Manager of Wildomar from 2009-2012. During Frank's
career, he has worked in every city department in three cities, with a steady progression of management
responsibilities in local government. Frank Oviedo earned a Bachelor's degree from California State University
Fresno and a Master's degree in Public Administration from Arizona State University.
Mr. Darren Hernandez, Deputy City Manager, leads the Department of Neighborhood Services. Darren
joined the City of Santa Clarita in January 2004 as Director of Administrative Services and was named Deputy
City Manager in July 2007. Previously Mr. Hernandez has served as the Director of Finance & City Treasurer
of La Habra, California; Village Manager of Walden, New York; Assistant to the City Manager of Kalamazoo,
Michigan; and, Executive Assistant to the Controller of the State of New York. He has a Bachelor of Arts
degree from the State University of New York and studied public administration as a graduate student at the
Maxwell School of Syracuse University.
Ms. Carmen Magana is the appointed Treasurer and Director of Administrative Services for the City. In
this position she provides leadership to the Department of Administrative Services and serves as the Chief
Financial Officer of the City and the Successor Agency. Ms. Magana began her career with the City in 1998
and prior to this position, she served as the Administrative Services Manager overseeing Finance and
Technology Services. She is a member of the City's Leadership Team and serves as a member of the City's
Budget Team. Ms. Magana received a Bachelor's degree from California State University, Northridge in
Business Administration and Finance and a Master's degree in Public Administration, Public Sector
Management and Leadership.
A-2
Municipal Services
The City provides park and recreation services, transit services, trash collection, street maintenance,
building inspection and planning services. As a "contract city," the City purchases certain public services
through contracts with other agencies and private companies. Contracting for services enables the City to
accomplish the essential administrative and operational functions of a municipality with a relatively small
workforce and payroll, and a minimum of facilities and equipment. The primary example of the contract for
public safety services, whose sworn and civilian personnel are provided by the Los Angeles County Sheriff
Department. Fire protection is provided by the Los Angeles County Fire Protection District. Other regularly
contracted services include refuse and recycling collection, landscaping and public transit services.
Population
2019.
The following table shows the City's and County's population as of January 1, 2011 through January 1,
CITY OF SANTA CLARITA AND LOS ANGELES COUNTY
Population
Year Los Angeles County City of Santa Clarita
2011
9,885,948
177,613
2012
9,972,649
179,487
2013
10,040,960
206,801
2014
10,098,952
207,232
2015
10,155,753
207,948
2016
10,185,851
208,550
2017
10,226,920
212,375
2018
10,254,658
212,378
2019
10,253,716
218,103
Source: State of California, Department of Finance, E-4 Population Estimates for Cities, Counties,
and the State,
2011-2019, with 2010 Census Benchmark.
Sacramento, California, May 2019, as ofJanuary 1.
Income
The U.S. Census Bureau American FactFinder reports that the median income of households in the City
for 2017 is $90,544 compared to $67,169 for the State and $57,652 for the nation. Eighty-five percent of the
households received earnings and sixteen percent received retirement income other than Social Security, with
over twenty-four percent of the households receiving Social Security. These income sources are not mutually
exclusive, with some households receiving income from more than one source.
Education
The City is served by 48 elementary schools, 6 middle schools, 7 high schools and numerous private
and parochial schools. Three colleges are located in the Santa Clarita Valley, California Institute of the Arts,
The Masters College and College of the Canyons. California State University — Northridge in the northern part
of the San Fernando Valley is nearby and serves as an additional resource for higher -level education.
A-3
Assessed Valuation
In Fiscal Year 2019/20, the City was the fifth largest city in assessed valuation within the County. The
following table represents the most recent ten-year history of assessed valuation in the City, including State -
reimbursed exemptions.
CITY OF SANTA CLARITA
Assessed Valuation
(000s)
Fiscal Year
Local Secured
Utility
Unsecured
Total
2009/10
$20,313,270
$4,015
$944,836
$21,262,122
2010/11
20,222,555
4,015
887,372
21,113,942
2011/12
20,317,662
3,696
847,579
21,168,938
2012/13
20,111,075
3,696
870,669
20,985,441
2013/14
23,410,799
3,696
854,976
24,269,472
2014/15
25,220,113
3,696
888,132
26,111,942
2015/16
26,473,499
3,696
853,667
27,330,863
2016/17
27,884,913
3,696
797,211
28,685,821
2017/18
29,903,220
4,576
819,549
30,727,345
2018/19
31,772,883
4,576
848,468
32,625,928
2019/20
Source: HdL Coren & Cone, Los Angeles County Assessor.
Housing
As of January 1, 2019, the California Department of Finance reported that there were 46,784 single
family detached units in the City, 9,001 single family attached units, 18,392 multifamily housing units and 2,603
mobile home units. The vacancy rate is approximately 6.0%. For 2017, the average median price within the
City of a single family home was $567,925 and of a condominium was $359,167.
Construction Activity
The following table shows the valuation of building permits issued in the City for the last five calendar
years in which the data is available.
CITY OF SANTA CLARITA
Building Permits and
Valuations
Year
Residential Permits
Residential Value
Non -Residential Value
Total
2013
2,555
$151,254,506
$ 81,533,565
$232,788,071
2014
2,733
149,911,340
51,329,822
201,241,162
2015
2,896
179,744,814
47,269,711
227,014,525
2016
2,058
172,063,366
81,352,376
253,415,742
2017
2,088
193,928,950
117,854,007
311,782,957
2018
1,993
170,234,197
98,154,780
268,388,977
Source:
City of Santa Clarita Permit System
A-4
Development Activity within the City
The following projects are currently under construction within the City. These projects have received
planning entitlements, and have pulled the requisite grading, building, and other applicable permits.
Housing. Aliento development was approved in January 2002 and is estimated to be completed in July
2020. The community includes 495 single family units (95 of which are age qualified), 2 recreation centers, a
trailhead park, and 900 acres of open space.
The Galloway Senior housing project at Five Knolls, including a senior residential community with 140
age -restricted units, a YMCA, and a senior center, was approved in 2015. The project is under construction and
is estimated to be completed in 2020.
River Village (Area D) is a 184 multi -family unit project on 32 acres. Design plans were approved in
August 2018.
Commercial. The Center at Needham Park, a business park with 4 million square feet of planned
industrial and commercial use was approved in 2003. Phase 1 is currently under construction, including 7
buildings, and is estimated to be completed in second quarter of 2020.
Two new buildings will be constructed at the Southern California Innovation Park, including a 136,900
square -foot office building and 10,776 square -foot daycare facility. The Tourney Place office building will add
46,000 square -feet of office space to the City. The Canyon County Commerce Park will create 30,000 square -
feet of office space and 30,000 square -feet of retail space.
A Homewood Suites and Hampton Inn will add 185 hotel rooms for the City. Homewood Suites is
phase 1 and is currently under construction. The Luxen Hotel, a 42-room boutique hotel, is also under
construction. Also under construction is a 182-room Residence Inn/Springhill Suites and 108-room Holiday Inn
Express. A new 7-screen, 500-seat Laemmle Theatre is scheduled to open in second quarter of 2020.
Mixed -Use. Newhall Crossings, a mixed -use project, containing 20,000 square feet of retail and 47
residential units, was approved in 2016 and is estimated to be completed in first quarter of 2020.
Vista Canyon Ranch development was approved in 2011 and is projected to include 1,100 residential
units, 950,000 square feet of commercial (office, retail, hotel, theater), and parking structures by its completion
in 2023. The development will contain open space, public parks, trails, and a new Metrolink and bus transit
station. Phase 1 is currently under construction.
Also under construction is the Valencia Town Center Square project, which includes 60 units and
10,000 square feet of commercial space and a subterranean automated self -parking system.
Civic Uses. The Henry Mayo Newhall Hospital Master Plan was approved in 2008, and a new 142-bed
inpatient tower was opened in 2019.
Employment
The following table summarizes the City's employment and unemployment rates for 2014 through 2018
calendar years.
CITY OF SANTA CLARITA
Civilian Labor Force, Employment and Unemployment
Annual Averages
A-5
2014
2015
2016
2017
2018
Civilian Labor Force
Employment
95,100
95,100
96,200
112,300
113,600
Unemployment
7,200
5,800
4,500
4,600
4,900
Total
87 900
89 300
91 700
107 700
108 600
Unemployment Rate (a)
7.6%
6.0%
4.7%
4.1%
4.3%
(a) The unemployment rate
is calculated using unrounded data.
Source: California Employment Development Department, April 19, 2019 with March 2018 Benchmark.
Largest Employers
Major non -governmental employers within the Santa Clarita Valley are as follows:
SANTA CLARITA VALLEY
Major Non -Governmental Employers
Company
Product/Service
Employees
Six Flags Magic Mountain
Amusement Park
3,200
Princess Cruises
Travel
2,177
Henry Mayo Newhall Memorial Hospital
Hospital
1,982
Boston Scientific
Medical Device
900
The Master's College
Education
765
Walmart
Retail
705
California Institute of the Arts
Education
700
Woodward HRT (formerly H.R. Textron)
Aerospace
680
Quest Diagnostics (formerly Specialty Labs)
Medical R&D
660
Advanced Bionics
Medical Device
581
Subtotal 12,350
Other 9,781
Private Subtotal within Top 50 22,131
Gov. Subtotal within Top 50 8,686
Total within Top 50 30,817
Source: 2019 Economic Outlook -for the Santa Clarita Valley.
Commercial Activity and Sales Tax
The following tables show total taxable transactions and sales tax revenues within the City over the last
seven calendar years in which annual data is available.
CITY OF SANTA CLARITA
Taxable Transactions
(Thousands of Dollars)
A-6
Year
Permits
Taxable Transactions
2011
5,934
$2,601,240
2012
6,021
2,764,693
2013
6,012
2,896,147
2014
6,232
3,004,553
2015
7,008
3,096,583
2016
7,009
3,151,492
2017
7,093
3,238,131
Source: California Board of Equalization and California Department of Tax and Fee Administration.
The following table shows a breakdown of the taxable sales within the City for 2017 calendar year (the latest
calendar year in which annual information
is available).
CITY OF SANTA CLARITA
Taxable Sales — 2017
Type
of Business Permits
Taxable Transactions
Retail and Food Services
Motor Vehicle and Parts Dealers
162
$ 679,607,877
Home Furnishings and Appliance Stores
281
120,191,850
Bldg. Material and Garden Equip. & Supplies
103
207,054,620
Food and Beverage Stores
139
136,089,455
Gasoline Stations
47
278,304,868
Clothing and Clothing Accessories Stores
743
135,163,263
General Merchandise Stores
256
419,900,850
Food Services and Drinking Places
558
453,017,714
Other Retail Stores
2,327
217,893,290
Retail and Food Total
4,616
S2,647,223,787
All Other Outlets
2,477
590,907,976
Totals All Outlets
7,093
S3,238,131,763
Source: California Department of Tax and Fee Administration.
A-7
Industry
The City is part of the Los Angeles -Long Beach -Glendale Metropolitan Statistical Area ("MSA"),
which is comprised of parts of Los Angeles County.
LOS ANGELES-LONG BEACH-GLENDALE MSA
Historical Civilian Labor Force
Calendar Years 2013 through 2017
Annual Averages
Wage and Salary Employment:(2) 2013 2014 2015 2016 2017
Agriculture
Mining and Logging
Construction
Manufacturing
Wholesale Trade
Retail Trade
Transportation, Warehousing, Utilil
Information
Finance and Insurance
Real Estate and Rental and Leasing
Professional and Business Services
Educational and Health Services
Leisure and Hospitality
Other Services
Federal Government
State Government
Local Government
5,500
5,200
5,000
5,300
5,800
3,400
3,100
2,900
2,500
2,200
114,600
118,500
126,200
133,900
137,700
375,600
371,100
367,800
360,300
350,100
218,700
222,500
225,700
225,200
224,500
405,800
413,100
419,300
421,500
422,500
es 157,500
163,400
171,500
182,300
191,800
197,000
198,800
207,500
229,200
214,500
138,300
134,500
135,600
138,100
137,400
74,700
76,700
80,000
81,600
83,700
584,800
591,700
593,800
603,200
613,400
702,100
720,700
741,100
767,600
794,300
438,900
464,100
486,600
510,000
523,900
145,700
150,500
151,000
153,300
154,100
47,200
46,700
47,400
47,700
48,000
83,600
85,300
87,400
89,900
92,500
420.500
424.200
433.700
438.600
438.600
Total all Industries (1) 4,113,600 4,189,800 4,282,300 4,390,800 4,441,400
(1) Totals may not add due to rounding.
Source: State of California Employment Development Department.
Recreational Activities
There are a number of recreational and historical facilities located in the Santa Clanta Valley. Among
them are Six Flags Magic Mountain Amusement Park and Gene Autry's Melody Ranch. For water enthusiasts
there are Castaic Lake, Lake Hughes, Lake Elizabeth, Lake Piru and Lake Pyramid. The Angeles National
Forest, Placenta Canyon Nature Center, Saugus Train Station, Vasquez Rocks County Park and the City's
community parks are also available for hiking and picnicking. William S. Hart Park features a Spanish colonial
mansion museum. Within the City, there are 34 park facilities, nearly 10,000 acres of City -owned open space
and 140 miles trails and paseos designed for commuting and recreational use, including walking, hiking, biking
and skating. Frazier Park and Mountain High are within a 40 mile drive for ski enthusiasts. Also located in the
City are the Canyon Theatre Guild and The Main, multi -use arts center, as well as the Friendly Valley, Valencia
Country Club, Sand Canyon Country Club and Vista Valencia golf courses. Santa Clarita residents enjoy the
City's distinctive trail system. There are three libraries located in the valley.
A-8
APPENDIX B
FORM OF BOND COUNSEL'S OPINION
[Closing Date]
City of Santa Clarita Community Facilities
District No. 2016-1 (Vista Canyon)
23920 Valencia Boulevard, Suite 295
Santa Clarita, California 91355
Re: $18,055,000 City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) Special Tax
Bonds, 2020 Series
Ladies and Gentlemen:
We have acted as bond counsel to the City of Santa Clarita Community Facilities District No. 2016-1 (Vista
Canyon) (the "District") in connection with the issuance of $18,055,000 aggregate principal amount of City of
Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) Special Tax Bonds, 2020 Series (the
"2020 Bonds"), pursuant to the provisions of the Mello -Roos Community Facilities Act of 1982, as amended,
being Chapter 2.5, Part 1, Division 2, Title 5, of the Government Code of the State of California (the "Act"), and
pursuant to a Fiscal Agent Agreement, dated as of February 1, 2020 (the "Fiscal Agent Agreement"), by and
between the District, acting through the City Council of the City of Santa Clarita as its legislative body, and U.S.
Bank National Association, as fiscal agent (the "Fiscal Agent"). We have examined the Act and such certified
proceedings and other papers as we deem necessary to render this opinion.
As to questions of fact material to our opinion, we have relied upon representations of the District contained in
the Fiscal Agent Agreement and in the certified proceedings and certifications of public officials and others
furnished to us, without undertaking to verify the same by independent investigation.
Based upon the foregoing we are of the opinion, under existing law, as follows:
The Fiscal Agent Agreement has been duly and validly authorized, executed and delivered by the
District and constitutes the legally valid and binding obligation of the District, enforceable against
the District in accordance with its terms.
2. The 2020 Bonds constitute valid and binding limited obligations of the District as provided in the
Fiscal Agent Agreement, and are entitled to the benefits of the Fiscal Agent Agreement.
The 2020 Bonds are secured by a valid pledge of the Special Taxes and all moneys in the funds and
accounts under the Fiscal Agent Agreement, including all amounts derived from the investment of
such moneys, subject to the application thereof on the terms and conditions as set forth in the Fiscal
Agent Agreement.
4. Under existing law, and assuming continued compliance with the covenants mentioned below, interest
on the 2020 Bonds is excluded pursuant to section 103(a) of the Internal Revenue Code of 1986 (the
"Code") from the gross income of the owners thereof for federal income tax purposes. We are further of
the opinion that under existing law, the 2020 Bonds are not "specified private activity bonds" within the
meaning of section 57(a)(5) of the Code and, therefore, that interest on the 2020 Bonds will not be
treated as an item of tax preference for purposes of computing the alternative minimum tax imposed by
section 55 of the Code. We are further of the opinion that under existing law interest on the 2020 Bonds
is exempt from personal income taxes of the State of California.
1
The Code imposes certain requirements that must be met subsequent to the issuance and delivery of the 2020
Bonds for interest thereon to be and remain excluded pursuant to section 103(a) of the Code from the gross
income of the owners thereof for federal income tax purposes. Non-compliance with such requirements
could cause the interest on the 2020 Bonds to fail to be excluded from the gross income of the owners thereof
retroactive to the date of issuance of the 2020 Bonds. Pursuant to the Fiscal Agent Agreement, and in the
Tax Certificate Pertaining to Arbitrage and Other Matters under Sections 103 and 141-150 of the Internal
Revenue Code of 1986 being delivered by the District in connection with the issuance of the 2020 Bonds, the
District is making representations relevant to the determination of, and is making certain covenants regarding
or affecting, the exclusion of interest on the 2020 Bonds from the gross income of the owners thereof for
federal income tax purposes. In reaching our opinions described in the immediately preceding paragraph, we
have assumed the accuracy of such representations and the present and future compliance by each of the
District and the City with its covenants. Further, except as stated in the preceding paragraph, we express no
opinion as to any federal or state tax consequence of the receipt of interest on, or the ownership or disposition
of, the 2020 Bonds. Furthermore, we express no opinion as to any federal, state or local tax law consequence
with respect to the 2020 Bonds, or the interest thereon, if any action is taken or not taken based upon the
advice or approval of other counsel.
The opinions expressed in paragraphs 1 and 3 above are qualified to the extent the enforceability of the 2020 Bonds
and the Fiscal Agent Agreement may be limited by applicable bankruptcy, insolvency, debt adjustment,
reorganization, moratorium or similar laws or equitable principles relating to or limiting creditors' rights generally or
as to the availability of any particular remedy. The enforceability of the 2020 Bonds and the Fiscal Agent Agreement
is subject to the effect of general principles of equity, including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing, to the possible unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or at law, and to the limitations on legal remedies against
governmental entities in California.
No opinion is expressed herein on the accuracy, completeness or sufficiency of the Official Statement or other
offering material relating to the 2020 Bonds.
Our opinions are based on existing law, which is subject to change. Such opinions are further based on our
knowledge of facts as of the date hereof. We assume no duty to update or supplement our opinions to reflect any
facts or circumstances that may hereafter come to our attention or to reflect any changes in any law that may hereafter
occur or become effective. Moreover, our opinions are not a guarantee of result and are not binding on the Internal
Revenue Service; rather, such opinions represent our legal judgment based upon our review of existing law that we
deem relevant to such opinions and in reliance upon the representations and covenants referenced above.
Respectfully submitted,
APPENDIX C
SUMMARY OF CERTAIN PROVISIONS
OF THE FISCAL AGENT AGREEMENT
C-1
APPENDIX D
RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX
D-1
APPENDIX E
BOOK -ENTRY ONLY SYSTEM
The information in this Appendix E concerning The Depository Trust Company ("DTC'), New York,
New York, and DTC's book -entry system has been obtained from DTC and the District takes no responsibility
for the completeness or accuracy thereof. The District cannot and does not give any assurances that DTC, DTC
Participants or Indirect Participants will distribute to the Beneficial Owners (a) payments of interest, principal
or premium, if any, with respect to the 2020 Bonds, (b) certificates representing ownership interest in or other
confirmation or ownership interest in the 2020 Bonds, or (c) redemption or other notices sent to DTC or Cede &
Co., its nominee, as the registered owner of the 2020 Bonds, or that they will so do on a timely basis, or that
DTC, DTC Participants or DTC Indirect Participants will act in the manner described in this Appendix. The
current "Rules" applicable to DTC are on file with the Securities and Exchange Commission and the current
"Procedures " of DTC to be followed in dealing with DTC Participants are on file with DTC.
The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the 2020
Bonds. The 2020 Bonds will be issued as fully -registered securities registered in the name of Cede & Co.
(DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC.
One fully -registered Bond certificate will be issued for each maturity of the 2020 Bonds, each in the aggregate
principal amount of such maturity, and will be deposited with DTC.
DTC, the world's largest securities depository, is a limited -purpose trust company organized under the
New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 1 7A of the
Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and
non-U.S. equity issues, corporate and municipal debt issues, and money market instruments (from over 100
countries) that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post -trade
settlement among Direct Participants of sales and other securities transactions in deposited securities, through
electronic computerized book -entry transfers and pledges between Direct Participants' accounts. This eliminates
the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S.
securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations.
DTC is a wholly -owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC"). DTCC is the
holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation,
all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access
to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a
Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a Standard & Poor's rating of
"AA+." The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission.
More information about DTC can be found at www.dtcc.com.
Purchases of 2020 Bonds under the DTC system must be made by or through Direct Participants, which
will receive a credit for the 2020 Bonds on DTC's records. The ownership interest of each actual purchaser of
each 2020 Bond (`Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are,
however, expected to receive written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered
into the transaction. Transfers of ownership interests in the 2020 Bonds are to be accomplished by entries made
on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will
not receive certificates representing their ownership interests in 2020 Bonds, except in the event that use of the
book -entry system for the 2020 Bonds is discontinued.
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To facilitate subsequent transfers, all 2020 Bonds deposited by Direct Participants with DTC are
registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by
an authorized representative of DTC. The deposit of 2020 Bonds with DTC and their registration in the name of
Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the 2020 Bonds; DTC's records reflect only the identity of the
Direct Participants to whose accounts such 2020 Bonds are credited, which may or may not be the Beneficial
Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on
behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants
to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be
governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect
from time to time. Beneficial Owners of 2020 Bonds may wish to take certain steps to augment the transmission
to them of notices of significant events with respect to the 2020 Bonds, such as redemptions, tenders, defaults,
and proposed amendments to the 2020 Bond documents. For example, Beneficial Owners of 2020 Bonds may
wish to ascertain that the nominee holding the 2020 Bonds for their benefit has agreed to obtain and transmit
notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and
addresses to the registrar and request that copies of notices be provided directly to them.
Redemption notices shall be sent to DTC. If less than all of the 2020 Bonds within a maturity are being
redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such
maturity to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to 2020
Bonds unless authorized by a Direct Participant in accordance with DTC's MMI Procedures. Under its usual
procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date. The Omnibus
Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts 2020
Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).
Principal, premium (if any), and interest payments on the 2020 Bonds will be made to Cede & Co., or
such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit
Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from the
District or the Fiscal Agent, on payable date in accordance with their respective holdings shown on DTC's
records. Payments by Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of customers in bearer form or registered
in "street name," and will be the responsibility of such Participant and not of DTC, the Fiscal Agent, or the
District, subject to any statutory or regulatory requirements as may be in effect from time to time. Principal,
premium (if any), and interest payments with respect to the 2020 Bonds to Cede & Co. (or such other nominee
as may be requested by an authorized representative of DTC) is the responsibility of the District or the Fiscal
Agent, disbursement of such payments to Direct Participants will be the responsibility of DTC, and
disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect
Participants.
DTC may discontinue providing its services as depository with respect to the 2020 Bonds at any time by
giving reasonable notice to the District or the Fiscal Agent. Under such circumstances, in the event that a
successor depository is not obtained, Bond certificates are required to be printed and delivered.
The District may decide to discontinue use of the system of book -entry -only transfers through DTC (or
a successor securities depository). In that event, Bond certificates will be printed and delivered in accordance
with the provisions of the Fiscal Agent Agreement.
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The information in this section concerning DTC and DTC's book -entry system has been obtained from
sources that the District and the Underwriter believe to be reliable, but the District and the Underwriter take no
responsibility for the accuracy thereof.
Discontinuance of DTC Services
In the event that (a) DTC determines not to continue to act as securities depository for the 2020 Bonds,
or (b) the District determines that DTC shall no longer act and delivers a written certificate to the Fiscal Agent
to that effect, then the District will discontinue the Book -Entry System with DTC for the 2020 Bonds. If the
District determines to replace DTC with another qualified securities depository, the District will prepare or
direct the preparation of a new single separate, fully -registered 2020 Bond for each maturity of the 2020 Bonds
registered in the name of such successor or substitute securities depository as are not inconsistent with the terms
of the Fiscal Agent Agreement. If the District fails to identify another qualified securities depository to replace
the incumbent securities depository for the 2020 Bonds, then the 2020 Bonds shall no longer be restricted to
being registered in the 2020 Bond registration books in the name of the incumbent securities depository or its
nominee, but shall be registered in whatever name or names the incumbent securities depository or its nominee
transferring or exchanging the 2020 Bonds shall designate.
In the event that the Book -Entry System is discontinued, the following provisions would also apply: (i)
the 2020 Bonds will be made available in physical form, (ii) principal of, and redemption premiums if any, on
the 2020 Bonds will be payable upon surrender thereof at the trust office of the Fiscal Agent identified in the
Fiscal Agent Agreement, and (iii) the 2020 Bonds will be transferable and exchangeable as provided in the
Fiscal Agent Agreement.
The District or the Fiscal Agent do not have any responsibility or obligation to DTC Participants, to
the persons for whom they act as nominees, to Beneficial Owners, or to any other person who is not shown on
the registration books as being an owner of the 2020 Bonds, with respect to (i) the accuracy of any records
maintained by DTC or any DTC Participants; (ii) the payment by DTC or any DTC Participant of any amount
in respect of the principal of, redemption price of or interest on the 2020 Bonds; (iii) the delivery of any notice
which is permitted or required to be given to registered owners under the Fiscal Agent Agreement, (iv) the
selection by DTC or any DTC Participant of any person to receive payment in the event of a partial redemption
of the 2020 Bonds; (v) any consent given or other action taken by DTC as registered owner; or (vi) any other
matter arising with respect to the 2020 Bonds or the Fiscal Agent Agreement. The District or the Fiscal Agent
cannot and do not give any assurances that DTC, DTC Participants or others will distribute payments of
principal of or interest on the 2020 Bonds paid to DTC or its nominee, as the registered owner, or any notices to
the Beneficial Owners or that they will do so on a timely basis or will serve and act in a manner described in
this Official Statement. The District or the Fiscal Agent are not responsible or liable for the failure of DTC or
any DTC Participant to make any payment or give any notice to a Beneficial Owner in respect to the 2020
Bonds or any error or delay relating thereto.
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APPENDIX F
FORMS OF CONTINUING DISCLOSURE CERTIFICATES
LANDOWNER CONTINUING DISCLOSURE CERTIFICATE
This Landowner Continuing Disclosure Certificate (the "Disclosure Certificate") is executed and
delivered by [landowner], (the "Landowner") in connection with the issuance of
$18,055,000 aggregate principal amount of the City of Santa Clarita Community Facilities District No. 2016-1
(Vista Canyon) Special Tax Bonds, 2020 Series (the "2020 Bonds"). The 2020 Bonds are being issued under
the Fiscal Agent Agreement, dated as of February 1, 2020 (the "Fiscal Agent Agreement"), by and between the
City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon) (the "District") and U.S. Bank
National Association. The Landowner covenants and agrees as follows:
Section 1. Purpose of the Disclosure Certificate. This Disclosure Certificate is being executed and
delivered by the Landowner for the benefit of the Owners.
Section 2. Definitions. In addition to the definitions set forth in the Fiscal Agent Agreement, which
apply to any capitalized term used in this Disclosure Certificate unless otherwise defined in this Section, the
following capitalized terms shall have the following meanings:
"Affiliate" of another Person means any other Person directly or indirectly controlling, controlled by, or
under common control with, such other Person; for purposes hereof, "control", "controlling" and "controlled"
means the power to direct the management and policies of a Person, directly, or indirectly, whether through the
ownership of voting securities, by contract or otherwise. [For Vista Canyon Ranch: For purposes of this
Disclosure Certificate, VC Lincoln 1, LLC and Vista Canyon Phas e 1, LLC are Affiliates of the Landowner.]
"Assumption Agreement" means an undertaking of a Major Owner, or an Affiliate thereof (as
applicable), for the benefit of the Beneficial Owners of the 2020 Bonds to assume the terms and obligations of
"Landowner" under this Disclosure Certificate (as modified for such Major Owner's development and financing
plans with respect to the Property), whereby such Major Owner or Affiliate agrees to provide annual reports and
notices of significant events, setting forth the information described in sections 4 and 5 hereof, respectively,
with respect to the portion of the property in the District owned by such Major Owner and/or its Affiliates.
"Beneficial Owner" shall mean any person which (a) has the power, directly or indirectly, to vote or
consent with respect to, or to dispose of ownership of, any 2020 Bonds (including persons holding 2020 Bonds
through nominees, depositories or other intermediaries), or (b) is treated as the owner of any 2020 Bonds for
federal income tax purposes.
"Dissemination Agent" shall mean U.S. Bank National Association, acting in its capacity as
dissemination agent hereunder, or any successor dissemination agent designated in writing by the Landowner
and which has filed with the Landowner a written acceptance of such designation.
"District" shall mean City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
"Event of Bankruptcy" means, with respect to a Person, that such Person files a petition or institutes a
proceeding under any act or acts, state or federal, dealing with or relating to the subject or subjects of
bankruptcy or insolvency, or under any amendment of such act or acts, either as a bankrupt or as an insolvent, or
as a debtor, or in any similar capacity, wherein or whereby such Person asks or seeks or prays to be adjudicated
a bankrupt, or is to be discharged from any or all of such Person's debts or obligations, or offers to such
Person's creditors to effect a composition or extension of time to pay such Person's debts or asks, seeks or prays
for reorganization or to effect a plan of reorganization, or for a readjustment of such Person's debts, or for any
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other similar relief, or if any such petition or any such proceedings of the same or similar kind or character is
filed or instituted or taken against such Person, or if a receiver of the business or of the property or assets of
such Person is appointed by any court, or if such Person makes a general assignment for the benefit of such
Person's creditors.
"Landowner Representative" shall mean the president, CEO, chief financial officer or general counsel
of the General Partner of the Landowner or his or her designee, or such other officer or employee as the
Landowner shall designate in writing to the Dissemination Agent from time to time.
"Listed Events" shall mean any of the events listed in Section 5(a) of this Disclosure Certificate.
"Major Owner" shall mean an owner (including all Affiliates of such owner that own land within the
District) of land in the District responsible in the aggregate for 20% or more of the annual Special Taxes levied
in the District.
"MSRB" shall mean the Municipal Securities Rulemaking Board established pursuant to Section
1513(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or authorized by the Securities
and Exchange Commission to receive reports. Until otherwise designated by the MSRB or the Securities and
Exchange Commission, filings with the MSRB are to be made through the Electronic Municipal Marketplace
Access (EMMA) website of the MSRB, currently located at http://emma.msrb.o.
"Owner" shall mean the person in whose name any 2020 Bonds shall be registered.
"Participating Underwriter" shall mean Stifel Nicolaus & Co., Inc., the original underwriter of the 2020
Bonds.
"Person" means an individual, a corporation, a partnership, a limited liability company, an association,
a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof.
"Property" means, at the time of inquiry, all real property within the District on which Special Taxes
have been levied by the District then -owned by (i) Landowner and its Affiliates that are not subject to a separate
continuing disclosure agreement and (ii) property conveyed from the Landowner to a Major Owner for which an
Assumption Agreement was not executed. For avoidance of doubt, any parcel that is exempt from the Special
Taxes shall not be considered Property for purposes of this Disclosure Certificate.
"Report Date" means June 15 and December 15 of each year, commencing June 15, 2020.
"Semi -Annual Report" shall mean any Semi -Annual Report provided by the Landowner or Major
Owner, as applicable, pursuant to, and as described in, Sections 3 and 4 of this Disclosure Certificate.
"Special Taxes" shall mean the special taxes to be levied within the District pursuant to the Fiscal
Agent Agreement.
Section 3. Provision of Semi -Annual Reports.
(a) With respect to each parcel of the Property until the obligations with respect to such parcel have
terminated in accordance with Section 6, the Landowner shall, or upon written request shall cause the
Dissemination Agent to, not later than the Report Date, provide or cause to provide to the MSRB a Semi -Annual
Report which is consistent with the requirements of Section 4 of this Disclosure Certificate, with a copy to the
District and the Participating Underwriter. Not later than fifteen (15) calendar days prior to each Report Date
(the "Notification Date"), the Landowner shall provide the Semi -Annual Report to the Dissemination Agent for
filing with the MSRB or notify the Dissemination Agent that the Landowner intends to file the Semi -Annual
Report directly with the MSRB prior to Report Date. If the Dissemination Agent does not receive the Semi -
Annual Report or notification that the Landowner will file the Semi -Annual Report with MSRB by the
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Notification Date, the Dissemination Agent will send a notice to the Landowner reminding it of the obligation to
provide the Annual Report by the Report Date. When providing the Semi -Annual Report to the Dissemination
Agent or the MSRB, as the case may be, the Landowner shall provide a written notification to the Dissemination
Agent, the District and the Participating Underwriter to the effect that such Semi -Annual Report constitutes the
Semi -Annual Report required to be furnished by the Landowner hereunder. The Dissemination Agent, the
District and the Participating Underwriter may conclusively rely upon such written notification of the
Landowner, and shall have no duty or obligation to review such Semi -Annual Report. The Semi -Annual Report
may be submitted as a single document or as separate documents comprising a package, and may include by
reference other information as provided in Section 4 of this Disclosure Certificate.
(b) If the Dissemination Agent is unable to verify that a Semi -Annual Report has been provided to
the MSRB by the Report Date, the Dissemination Agent shall send a notice to the MSRB in substantially the
form attached as Exhibit A.
(c) The Dissemination Agent shall, to the extent information is known to it, file a report with the
Landowner, the District and the Participating Underwriter certifying that the Semi -Annual Report has been
provided pursuant to this Disclosure Certificate, stating the date it was provided.
Section 4. Content of Semi -Annual Reports. The Landowner's Semi -Annual Report shall contain
or incorporate by reference the following:
(1) A general description of the development status of the Property within the CFD which
has not yet been issued a certificate of occupancy in a format similar to Table 1 of the
Official Statement.
(2) A description of any sales of the Property including the identification of each buyer and
identification of the Property so sold.
(3) Any material change in the ownership structure of the Landowner and its Affiliates that
own Property in the District.
(4) The assumption of any obligation by a Major Owner pursuant to Section 6.
Any or all of the items listed above may be included by specific reference to other documents, including
official statements of debt issues of the Landowner or related public entities, that have been submitted to each of
the MSRB or the Securities and Exchange Commission. If the document included by reference is a final official
statement, it must be available from the MSRB. The Landowner shall clearly identify each such other document
so included by reference in the Semi -Annual Report.
Section 5. Reporting of Significant Events.
(a) With respect to each parcel of the Property until the obligations with respect to such parcel have
terminated in accordance with Section 6, pursuant to the provisions of this Section 5, the Landowner shall give,
or cause to be given, notice of the occurrence of any of the following events, if material to the ability of the
Landowner to pay the Special Taxes prior to delinquency:
(1) failure to pay any real property taxes (including any Special Taxes, assessments, fees or
charges) levied within the District on the Property prior to such real property taxes
becoming delinquent;
(2) substantial damage to or destruction of any structures on the Property;
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(3) receipt of a written notice of a monetary default by the Landowner or its Affiliates, or
the occurrence of a non -monetary event of default that is beyond the applicable cure
period, on any loan secured by the Property; and
(4) the occurrence of an Event of Bankruptcy with respect to the Landowner, or any
Affiliate of the Landowner.
(b) Whenever Landowner Representative obtains knowledge of the occurrence of a Listed Event,
the Landowner Representative shall as soon as possible determine if such event would be material to the ability
of the Landowner to pay the Special Taxes prior to delinquency.
(c) If the Landowner Representative has determined that the occurrence of a Listed Event would be
material to the ability of the Landowner to pay the Special Taxes prior to delinquency, the Landowner
Representative shall, within ten (10) Business Days of obtaining actual knowledge of the occurrence of a Listed
Event, or as soon as reasonably practicable thereafter, promptly file a notice with the MSRB (providing a copy
to the District, the Participating Underwriter and the Dissemination Agent) or direct the Dissemination Agent in
writing to file such notice pursuant to subsection (d).
(d) If the Dissemination Agent has been instructed by the Disclosure Representative to report the
occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the MSRB.
Section 6. Duration of Reporting Obligation. All of the Landowner's obligations hereunder shall
commence on such date as the Property owned by the Landowner and its Affiliates are responsible for payment
of 20% or more of the Special Taxes and shall terminate upon the earlier to occur of (i) as to all of the Property,
upon the legal defeasance, prior redemption or payment in full of all the 2020 Bonds, (ii) as to all of the
Property, at such time as the Property that has not received a certificate of occupancy owned by the Landowner
and its Affiliates are no longer responsible for payment of 20% or more of the Special Taxes actually levied, (iii)
as to all of the Property, the date on which all Special Taxes on the Property are paid or prepaid in full, (iv) as to
any specific parcel of the Property, when the certificate of occupancy has been issued for such parcel, or (v) as
to any specific parcel of the Property that does not require a certificate of occupancy but is adjacent to a parcel
that does and such parcel is part of the development on the adjacent property (such as access roads, surface
parking, etc.), when the certificate of occupancy is issued for the adjacent parcel.
If a portion of the Property is conveyed to a Person that, upon such conveyance, will be a Major Owner,
the obligations of Landowner hereunder with respect to such Property owned by such Major Owner or its
Affiliates shall be assumed by such Major Owner or by an Affiliate thereof and the Landowner obligations
hereunder will be terminated as to the portion of the Property conveyed to such Major Owner. In order to effect
such an assumption, such Major Owner or Affiliate shall enter into an Assumption Agreement. The Landowner
shall provide a copy of the executed Assumption Agreement to the District and the Participating Underwriter.
The Landowner shall not be relieved of its obligations with respect to such portion of the Property conveyed to
the Major Owner until such a Major Owner or Affiliate has entered into the Assumption Agreement.
Section 7. Dissemination Agent. The Landowner may, from time to time, appoint or engage a
Dissemination Agent to assist it in carrying out its obligations under this Disclosure Certificate, and may
discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The
Dissemination Agent shall not be responsible in any manner for the content of any notice or report prepared by
the Landowner pursuant to this Disclosure Certificate. The initial Dissemination Agent shall be U.S. Bank
National Association. All compensation of U.S. Bank National Association for serving as Dissemination Agent
shall be paid by the District or the City. The Dissemination Agent may resign by providing thirty days written
notice to the Landowner and the District. The Dissemination Agent shall have no duty to prepare any
information report nor shall the Dissemination Agent be responsible for filing any report not provided to it by
the Landowner in a timely manner and in a form suitable for filing.
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Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Certificate, the
Landowner may amend this Disclosure Certificate (and the Dissemination Agent shall agree to any amendment
so requested by the Landowner) provided, the Dissemination Agent shall not be obligated to enter into any such
amendment that modifies or increases its duties or obligations hereunder, and any provision of this Disclosure
Certificate may be waived, provided that the following conditions are satisfied:
(1) If the amendment or waiver relates to the provisions of Sections 3(a), 4, or 5(a), it may only be
made in connection with a change in circumstances that arises from a change in legal
requirements, change in law, or change in the identity, nature or status of an obligated person
with respect to the 2020 Bonds, or the type of business conducted; and
(2) The amendment or waiver either (i) is approved by the Owners of the 2020 Bonds in the same
manner as provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent
Agreement with the consent of Owners, or (ii) does not, in the opinion of nationally recognized
bond counsel, materially impair the interests of the Owners or Beneficial Owners of the 2020
Bonds.
In the event of any amendment or waiver of a provision of this Disclosure Certificate, the Landowner
shall describe such amendment in the next Semi -Annual Report, and shall include, as applicable, a narrative
explanation of the reason for the amendment or waiver and its impact on the type of information being presented
by the Landowner.
Section 9. Additional Information. Nothing in this Disclosure Certificate shall be deemed to prevent
the Landowner from disseminating any other information, using the means of dissemination set forth in this
Disclosure Certificate or any other means of communication, or including any other information in any Semi -
Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure
Certificate. If the Landowner chooses to include any information in any Semi -Annual Report or notice of
occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Certificate, the
Landowner shall have no obligation under this Disclosure Certificate to update such information or include it in
any future Semi -Annual Report or notice of occurrence of a Listed Event.
Section 10. Filings with the MSRB. All financial information, operating data, financial statements,
notices, and other documents provided to the MSRB in accordance with this Disclosure Certificate shall be
provided in an electronic format prescribed by the MSRB and shall be accompanied by identifying information
as prescribed by the MSRB.
Section 11. Default. In the event of a failure of the Landowner or the Dissemination Agent to comply
with any provision of this Disclosure Certificate, the Dissemination Agent, at the request of the Owners of at
least 25% of the aggregate principal amount of the outstanding 2020 Bonds, shall (but only to the extent funds in
any amount satisfactory to the Dissemination Agent have been provided to it or it has been otherwise
indemnified to its satisfaction from any cost, liability, expense or additional charges whatsoever related thereto,
including without limitation, fees and expenses of its attorneys), or any Owner may, take such actions as may be
necessary and appropriate, including seeking mandate or specific performance by court order, to cause the
Landowner to comply with its obligations under this Disclosure Certificate. A default under this Disclosure
Certificate shall not be deemed an event of default under the Fiscal Agent Agreement and the sole remedy under
this Disclosure Certificate in the event of any failure of the Landowner or the Dissemination Agent to comply
with this Disclosure Certificate shall be an action to compel performance.
Section 12. Notices. Any notice or other communication to be given pursuant to this Disclosure
Certificate (including Semi -Annual Reports and certifications related thereto) may be given by (i) mail, (n)
unsecured email with an imaged or scanned attachment (such as a .pdf), or (iii) fax machine or other similar
electronic transmission, with confirmation of receipt of such transmission, to the party entitled thereto at its
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address set forth below, or at such other address as such party may provide to the other parry in writing from
time to time, namely:
To the District: City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
23920 Valencia Boulevard
Santa Clarita, California 91355
Attention: City Treasurer
Email: cmagana@santa-clarita.com
To the Landowner:
Attention:
Email:
To the Dissemination Agent: U.S. Bank National Association
633 W. Fifth St., 24th Floor
Los Angeles, CA 90071
Attention: Corporate Trust Department
Email:
To the Participating: Stifel, Nicolaus & Co.
Underwriter One Montgomery Street, 35th Floor
San Francisco, California 94104
Attention: Sara Oberlies Brown
Email: sbrown(a stifel.com
Section 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the District,
the Landowner, the Participating Underwriter and Owners, from time to time of the 2020 Bonds, and shall create
no rights in any other person or entity.
Dated: February , 2020
[LANDOWNER],
a
By:
Name:
Title:
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The undersigned hereby agrees to act as Dissemination
Agent pursuant to the foregoing Landowner
Continuing Disclosure Certificate
U.S. BANK NATIONAL ASSOCIATION
Ma
Its
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EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE SEMI-ANNUAL REPORT
Name of Issuer: City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
Name of Bond Issue: City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
Special Tax Bonds, 2020 Series
Date of Issuance: February _, 2020
NOTICE IS HEREBY GIVEN that the Landowner has not provided a Semi -Annual Report with respect
to the above -named 2020 Bonds as required by the Landowner Continuing Disclosure Certificate, dated
February , 2020, with respect to the 2020 Bonds. [The Landowner anticipates that the Semi -Annual Report
will be filed by ]
Dated
cc: District
Participating Underwriter
Dissemination Agent,
on behalf of the Landowner
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ISSUER CONTINUING DISCLOSURE CERTIFICATE
This Continuing Disclosure Certificate (the "Disclosure Certificate") , dated February , 2020, is
executed and delivered by the City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
(the "District") for the benefit of the Holders (hereinafter defined) of the 2020 Bonds (hereinafter defined) in
order to provide certain continuing disclosure with respect to the 2020 Bonds in accordance with Rule 15c2-12
of the United States Securities and Exchange Commission under the Securities Exchange Act of 1934, as the
same may be amended from time to time (the "Rule").
SECTION 1. Definitions. Capitalized terms not otherwise defined in this Disclosure Certificate shall
have the meaning assigned in the Rule or, to the extent not in conflict with the Rule, in the Official Statement
(hereinafter defined). The capitalized terms shall have the following meanings:
"2020 Bonds" means $18,055,000* City of Santa Clarita Community Facilities District No. 2016-1
(Vista Canyon) Special Tax Bonds, 2020 Series.
"Annual Report" means an Annual Report described in and consistent with Section 3 of this Disclosure
Certificate.
"Annual Filing Date" means the date, set in Section 2(a) and Section 2(f), by which the Annual
Report is to be filed with the MSRB.
"Annual Financial Information" means annual financial information as such term is used in
paragraph (b)(5)(1) of the Rule and specified in Section 3(a) of this Disclosure Certificate.
"Audited Financial Statements" means the financial statements (if any) of the City of Santa
Clarita for the prior Fiscal Year, certified by an independent auditor as prepared in accordance
with generally accepted accounting principles or otherwise, as such term is used in paragraph
(b)(5)(1) of the Rule and specified in Section 3(b) of this Disclosure Certificate.
"Certification" means a written certification of compliance signed by the Disclosure
Representative stating that the Annual Report, Audited Financial Statements, Notice Event
notice, or Failure to File Event notice delivered to the Disclosure Dissemination Agent is the
Annual Report, Audited Financial Statements, Notice Event notice, or Failure to File Event
notice, required to be submitted to the MSRB under this Disclosure Certificate. A Certification
shall accompany each such document submitted to the Disclosure Dissemination Agent by the
District and include the full name of the 2020 Bonds and the 9-digit CUSIP numbers for all
2020 Bonds to which the document applies.
"Disclosure Representative" means the Treasurer of the City or his or her designee, or such
other person as the City shall designate in writing to the Disclosure Dissemination Agent from
time to time as the person responsible for providing Information to the Disclosure
Dissemination Agent.
"Disclosure Dissemination Agent" shall mean Digital Assurance Certification LLC, or any
successor Dissemination Agent designated in writing by the District and which has filed with
the District a written acceptance of such designation.
"Failure to File Event" means the District's failure to file an Annual Report on or before the
Annual Filing Date.
. Preliminary, subject to change.
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"Financial Obligation" means a (a) debt obligation; (b) derivative instrument entered into in
connection with, or pledged as security or a source of payment for, an existing or planned debt
obligation; or (c) guarantee of a debt obligation or any such derivative instrument; provided that
"financial obligation" shall not include municipal securities as to which a final official
statement has been provided to the MSRB consistent with the Rule.
"Fiscal Agent" means U.S. Bank National Association, as fiscal agent under the Fiscal Agent
Agreement, dated as of February 1, 2020, by and between the Issuer and the Fiscal Agent, as
amended and supplemented, providing for the issuance of the 2020 Bonds.
"Force Maj cure Event" means: (i) acts of God, war, or terrorist action; (ii) failure or shut -down
of the Electronic Municipal Market Access system maintained by the MSRB; or (iii) to the
extent beyond the Disclosure Dissemination Agent's reasonable control, interruptions in
telecommunications or utilities services, failure, malfunction or error of any
telecommunications, computer or other electrical, mechanical or technological application,
service or system, computer virus, interruptions in Internet service or telephone service
(including due to a virus, electrical delivery problem or similar occurrence) that affect Internet
users generally, or in the local area in which the Disclosure Dissemination Agent or the MSRB
is located, or acts of any government, regulatory or any other competent authority the effect of
which is to prohibit the Disclosure Dissemination Agent from performance of its obligations
under this Disclosure Certificate.
"Holder" means any person (i) having the power, directly or indirectly, to vote or consent with
respect to, or to dispose of ownership of, any 2020 Bonds (including persons holding 2020
Bonds through nominees, depositories or other intermediaries) or (ii) treated as the owner of
any 2020 Bonds for federal income tax purposes.
"Information" means, collectively, the Annual Reports, the Audited Financial Statements (if
any), the Notice Event notices, and the Failure to File Event notices.
"Issuer" or "District" means the District of Santa Clarita Community Facilities District No.
2016-1 (Vista Canyon).
"MSRB" means the Municipal Securities Rulemaking Board established pursuant to
Section 1513(b)(1) of the Securities Exchange Act of 1934 or any other entity designated or
authorized by the Securities and Exchange Commission to receive reports pursuant to the Rule.
Until otherwise designated by the MSRB or the Securities and Exchange Commission, filings
with the MSRB are to be made through the Electronic Municipal Marketplace Access (EMMA)
website of the MSRB, currently located at http://emma.msrb.org.
"Notice Event" means any of the events enumerated in paragraph (b)(5)(1)(C) of the Rule and
listed in Section 4(a) of this Disclosure Certificate.
"Obligated Person" means any person, including the District, who is either generally or through
an enterprise, fund, or account of such person committed by contract or other arrangement to
support payment of all, or part of the obligations on the 2020 Bonds (other than providers of
municipal bond insurance, letters of credit, or other liquidity facilities).
"Official Statement" means that Official Statement, dated January , 2020, prepared by the
Issuer in connection with the 2020 Bonds.
"SEC" means the United States Securities and Exchange Commission.
SECTION 2. Provision of Annual Reports and Other Disclosures.
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(a) The District shall provide, annually, an electronic copy of the Annual Report and Certification
to the Disclosure Dissemination Agent, together with a copy for the Fiscal Agent, not later than the Annual
Filing Date. Promptly upon receipt of an electronic copy of the Annual Report and the Certification, the
Disclosure Dissemination Agent shall provide an Annual Report to the MSRB no later than March 31 following
the end of each Fiscal Year, commencing with the report for Fiscal Year [2019-20]. Such date and each
anniversary thereof is the Annual Filing Date. The Annual Report may be submitted as a single document or as
separate documents comprising a package, and may cross-reference other information as provided in Section 3
of this Disclosure Certificate.
(b) If on the fifteenth (15th) day prior to the Annual Filing Date, the Disclosure Dissemination
Agent has not received a copy of the Annual Report and Certification, the Disclosure Dissemination Agent shall
contact the Disclosure Representative by telephone and in writing (which may be by e-mail) to remind the
District of its undertaking to provide the Annual Report pursuant to Section 2(a). Upon such reminder, the
Disclosure Representative shall either (i) provide the Disclosure Dissemination Agent with an electronic copy of
the Annual Report and the Certification no later than two (2) business days prior to the Annual Filing Date, or
(n) instruct the Disclosure Dissemination Agent in writing that the District will not be able to file the Annual
Report within the time required under this Disclosure Certificate, state the date by which the Annual Report for
such year will be provided and instruct the Disclosure Dissemination Agent that a Failure to File Event has
occurred and to immediately send a notice to the MSRB in substantially the form attached as Exhibit A.
(c) If the Disclosure Dissemination Agent has not received an Annual Report and Certification by
6:00 p.m. Eastern time on the Annual Filing Date (or, if such Annual Filing Date falls on a Saturday, Sunday or
holiday, then the first business day thereafter) for the Annual Report, a Failure to File Event shall have occurred
and the District irrevocably directs the Disclosure Dissemination Agent to immediately send a notice to the
MSRB in substantially the form attached as Exhibit A without reference to the anticipated filing date for the
Annual Report.
(d) If Audited Financial Statements of the District are prepared but not available prior to the Annual
Filing Date, the District shall, when the Audited Financial Statements are available, provide in a timely manner
an electronic copy to the Disclosure Dissemination Agent, accompanied by a Certification, together with a copy
for the Fiscal Agent, for filing with the MSRB.
(e) The Disclosure Dissemination Agent shall:
(i) verify the filing specifications of the MSRB each year prior to the Annual Filing Date;
(ii) upon receipt, promptly file each Annual Report received under Sections 2(a) and 2(b)
with the MSRB;
(iii) upon receipt, promptly file each Audited Financial Statement received under Section
2(d) with the MSRB;
(iv) upon receipt, promptly file the text of each Notice Event received under Sections 4(a)
and 4(b)(11) with the MSRB, identifying the Notice Event as instructed by the District
pursuant to Section 4(a) or 4(b)(11) when filing pursuant to Section 4(c) of this
Disclosure Certificate.
(v) upon receipt (or irrevocable direction pursuant to Section 2(c) of this Disclosure
Certificate, as applicable), promptly file a completed copy of Exhibit A to this
Disclosure Certificate with the MSRB, identifying the filing as "Failure to provide
annual financial information as required" when filing pursuant to Section 2(b)(11) or
Section 2(c) of this Disclosure Certificate;
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(f) The District may adjust the Annual Filing Date upon change of its Fiscal Year by providing
written notice of such change and the new Annual Filing Date to the Disclosure Dissemination Agent, Fiscal
Agent (if any) and the MSRB, provided that the period between the existing Annual Filing Date and new
Annual Filing Date shall not exceed one year.
(g) Any Information received by the Disclosure Dissemination Agent before 6:00 p.m. Eastern time
on any business day that it is required to file with the MSRB pursuant to the terms of this Disclosure Certificate
and that is accompanied by a Certification and all other information required by the terms of this Disclosure
Certificate will be filed by the Disclosure Dissemination Agent with the MSRB no later than 11:59 p.m. Eastern
time on the same business day; provided, however, the Disclosure Dissemination Agent shall have no liability
for any delay in filing with the MSRB if such delay is caused by a Force Majeure Event provided that the
Disclosure Dissemination Agent uses reasonable efforts to make any such filing as soon as possible.
SECTION 3. Content of Annual Reports.
(a) Each Annual Report shall contain an update of the following information with respect to the
District's preceding Fiscal Year (to the extent not included in the audited financial statements described in
paragraph (b) below):
(i) Principal amount of 2020 Bonds outstanding.
(ii) Balance in the Reserve Account for the 2020 Bonds.
(iii) With Using the then current year's Special Tax levy, an update to Tables 4 and 5 of the
Official Statement.
(iv) Using the then current year's Special Tax levy and replacing Appraised Value with
Assessed Value, an update to Table 6 of the Official Statement;
(v) For purposes of determining whether a Trigger Event has occurred, a table showing the
maximum Assigned Special Taxes that could be levied on Developed Property, regardless of whether
such property was actually levied at its maximum Assigned rate, and calculating the debt service
coverage from such Special Taxes;
(vi) Concerning delinquent parcels:
number of parcels delinquent in payment of Special Tax,
amount of total delinquency and as a percentage of total Special Tax levy, and
• status of actions on covenants to pursue foreclosure proceedings upon
delinquent properties.
(vii) Identity of any delinquent tax payer obligated for more than 10% of the annual Special
Tax levy and:
assessed value of applicable properties, and
summary of results of foreclosure sales, if available.
(viii) Significant amendments to land use entitlements for property in the District.
(ix) A summary of any prepayments of the Special Tax for the most recent year.]
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(b) Audited Financial Statements prepared in accordance with generally accepted accounting
principles ("GAAP") as described in the Official Statement will also be included in the Annual Report. If
audited financial statements are not available by the date of the Annual Report, then, unaudited financial
statements, prepared in accordance with GAAP as described in the Official Statement will be included in the
Annual Report. Audited Financial Statements (if any) will be provided pursuant to Section 2(d).
Any or all of the items listed above may be included by specific reference to other documents, including
official statements of debt issues with respect to which the District is an Obligated Person, which have been
previously filed with the Securities and Exchange Commission or available to the public on the MSRB Internet
website. If the document incorporated by reference is a final official statement, it must be available from the
MSRB. The District will clearly identify each such document so incorporated by reference.
Any Annual Financial Information containing modified operating data or financial information is
required to explain, in narrative form, the reasons for the modification and the impact of the change in the type
of operating data or financial information being provided.
SECTION 4. Reporting of Notice Events.
(a) The occurrence of any of the following events with respect to the 2020 Bonds constitutes a
Notice Event:
Principal and interest payment delinquencies;
2. Non-payment related defaults, if material;
Unscheduled draws on debt service reserves reflecting financial difficulties;
4. Unscheduled draws on credit enhancements reflecting financial difficulties;
Substitution of credit or liquidity providers, or their failure to perform;
6. Adverse tax opinions, the issuance by the Internal Revenue Service of proposed or final
determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other
material notices or determinations with respect to the tax status of the 2020 Bonds, or
other material events affecting the tax status of the 2020 Bonds;
7. Modifications to rights of Bond holders, if material;
Bond calls, if material, and tender offers;
9. Defeasances;
10. Release, substitution, or sale of property securing repayment of the 2020 Bonds, if
material;
11. Rating changes;
12. Bankruptcy, insolvency, receivership or similar event of the Obligated Person;'
' For the purposes of the event described in subsection (12), the event is considered to occur when any of the following
occur: the appointment of a receiver, fiscal agent or similar officer for an Obligated Person in a proceeding under the U.S.
Bankruptcy Code or in any other proceeding under state or federal law in which a court or governmental authority has
assumed jurisdiction over substantially all of the assets or business of the Obligated Person, or if such jurisdiction has been
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13. The consummation of a merger, consolidation, or acquisition involving an Obligated
Person or the sale of all or substantially all of the assets of the Obligated Person, other
than in the ordinary course of business, the entry into a definitive Certificate to
undertake such an action or the termination of a definitive Certificate relating to any
such actions, other than pursuant to its terms, if material;
14. Appointment of a successor or additional trustee or the change of name of a trustee, if
material;
15. Incurrence of a Financial Obligation of an Obligated Person, if material, or agreement
to covenants, events of default, remedies, priority rights, or other similar terms of a
Financial Obligation of an Obligated Person, any of which affect security holders, if
material; and
16. Default, event of acceleration, termination event, modification of terms, or other similar
events under the terms of a Financial Obligation of an Obligated Person, any of which
reflect financial difficulties.
The District shall, in a timely manner not in excess of ten (10) business days after its occurrence, notify
the Disclosure Dissemination Agent in writing of the occurrence of a Notice Event. Such notice shall instruct
the Disclosure Dissemination Agent to report the occurrence pursuant to subsection (c) and shall be
accompanied by a Certification. Such notice or Certification shall identify the Notice Event that has occurred
(which shall be any of the categories set forth in Section 2(e)(iv) of this Disclosure Certificate), include the text
of the disclosure that the District desires to make, contain the written authorization of the District for the
Disclosure Dissemination Agent to disseminate such information, and identify the date the District desires for
the Disclosure Dissemination Agent to disseminate the information (provided that such date is not later than the
tenth business day after the occurrence of the Notice Event).
(b) The Disclosure Dissemination Agent is under no obligation to notify the District or the
Disclosure Representative of an event that may constitute a Notice Event. In the event the Disclosure
Dissemination Agent so notifies the Disclosure Representative, the Disclosure Representative will within two
business days of receipt of such notice (but in any event not later than the tenth business day after the occurrence
of the Notice Event, if the District determines that a Notice Event has occurred), instruct the Disclosure
Dissemination Agent that (i) a Notice Event has not occurred and no filing is to be made or (ii) a Notice Event
has occurred and the Disclosure Dissemination Agent is to report the occurrence pursuant to subsection (c) of
this Section 4, together with a Certification. Such Certification shall identify the Notice Event that has occurred
(which shall be any of the categories set forth in Section 2(e)(iv) of this Disclosure Certificate), include the text
of the disclosure that the District desires to make, contain the written authorization of the District for the
Disclosure Dissemination Agent to disseminate such information, and identify the date the District desires for
the Disclosure Dissemination Agent to disseminate the information (provided that such date is not later than the
tenth business day after the occurrence of the Notice Event).
(c) If the Disclosure Dissemination Agent has been instructed by the District as prescribed in
subsection (a) or (b)(H) of this Section 4 to report the occurrence of a Notice Event, the Disclosure
Dissemination Agent shall promptly file a notice of such occurrence with the MSRB in accordance with Section
2(e)(iv) hereof
assumed by leaving the existing governing body and officials or officers in possession but subject to the supervision and
orders of a court or governmental authority, or the entry of an order confirming a plan of reorganization, arrangement or
liquidation by a court or governmental authority having supervision or jurisdiction over substantially all of the assets or
business of the Obligated Person.
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SECTION 5. CUSIP Numbers. Whenever providing information to the Disclosure Dissemination
Agent, including but not limited to Annual Reports, documents incorporated by reference to the Annual Reports,
Audited Financial Statements, Notice Event notices, and Failure to File Event notices, the District shall indicate
the full name of the 2020 Bonds and the 9-digit CUSIP numbers for the 2020 Bonds as to which the provided
information relates.
SECTION 6. Additional Disclosure Obligations. The District acknowledges and understands that
other state and federal laws, including but not limited to the Securities Act of 1933 and Rule IOb-5 promulgated
under the Securities Exchange Act of 1934, may apply to the District, and that the failure of the Disclosure
Dissemination Agent to so advise the District shall not constitute a breach by the Disclosure Dissemination
Agent of any of its duties and responsibilities under this Disclosure Certificate. The District acknowledges and
understands that the duties of the Disclosure Dissemination Agent relate exclusively to execution of the
mechanical tasks of disseminating information as described in this Disclosure Certificate.
SECTION 7. Voluntary Filings. Nothing in this Disclosure Certificate shall be deemed to prevent the
District from disseminating any other information through the Disclosure Dissemination Agent using the means
of dissemination set forth in this Disclosure Certificate or including any other information in any Annual Report,
Audited Financial Statements, Notice Event notice, or Failure to File Event notice, in addition to that required
by this Disclosure Certificate. If the District chooses to include any information in any Annual Report, Audited
Financial Statements, Notice Event notice, or Failure to File Event notice in addition to that which is specifically
required by this Disclosure Certificate, the District shall have no obligation under this Disclosure Certificate to
update such information or include it in any future Annual Report, Audited Financial Statements, Notice Event
notice, or Failure to File Event notice.
SECTION 8. Termination of Reporting Obligation. The obligations of the District and the Disclosure
Dissemination Agent under this Disclosure Certificate shall terminate with respect to the 2020 Bonds upon the
legal defeasance, prior redemption or payment in full of all of the 2020 Bonds, when the District is no longer an
Obligated Person with respect to such 2020 Bonds, or upon delivery by the Disclosure Representative to the
Disclosure Dissemination Agent of an opinion of nationally recognized bond counsel to the effect that
continuing disclosure is no longer required with respect to such 2020 Bonds.
SECTION 9. Disclosure Dissemination Agent. Digital Assurance Certification LLC will serve as the
initial Disclosure Dissemination Agent under this Disclosure Certificate. The District may, upon thirty days
written notice to the Disclosure Dissemination Agent and the Fiscal Agent, replace or appoint a successor
Disclosure Dissemination Agent. Upon termination of the Disclosure Dissemination Agent, whether by notice of
the District or the Disclosure Dissemination Agent, the District agrees to appoint a successor Disclosure
Dissemination Agent or, alternately, agrees to assume all responsibilities of Disclosure Dissemination Agent
under this Disclosure Certificate for the benefit of the Holders of the 2020 Bonds. Notwithstanding any
replacement or appointment of a successor, the District shall remain liable, until payment in full, for any and all
sums owed and payable to the Disclosure Dissemination Agent. The Disclosure Dissemination Agent may
resign at any time by providing thirty days' prior written notice to the District.
SECTION 10. Remedies in Event of Default. In the event of a failure of the District or the Disclosure
Dissemination Agent to comply with any provision of this Disclosure Certificate, the Holders' rights to enforce
the provisions of this Disclosure Certificate shall be limited solely to a right, by action in mandamus or for
specific performance, to compel performance of the parties' obligation under this Disclosure Certificate. Any
failure by a party to perform in accordance with this Disclosure Certificate shall not constitute a default on the
2020 Bonds or under any other document relating to the 2020 Bonds, and all rights and remedies shall be limited
to those expressly stated herein.
SECTION 11. Duties, Immunities and Liabilities of Disclosure Dissemination Agent.
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(a) Article VI of the Fiscal Agent Agreement is hereby made applicable to this Disclosure
Certificate as if this Disclosure Certificate were (solely for this purpose) contained in the Fiscal Agent
Agreement. The Disclosure Dissemination Agent shall be entitled to the protections and limitations from
liability afforded to the Fiscal Agent thereunder. The Disclosure Dissemination Agent shall have only such
duties as are specifically set forth in this Disclosure Certificate. and the District agrees to indemnify and save the
Disclosure Dissemination Agent, the Fiscal Agent, their officers, directors, employees and agents, harmless
against any loss, expense and liabilities which it may incur arising out of the disclosure of information pursuant
to this Disclosure Certificate or arising out of or in the exercise or performance of its powers and duties
hereunder, including the costs and expenses (including attorneys' fees) of defending against any claim of
liability, but excluding liabilities due to the Disclosure Dissemination Agent's negligence or willful misconduct.
The Disclosure Dissemination Agent's obligation to deliver the information at the times and with the contents
described herein shall be limited to the extent the District has provided such information to the Disclosure
Dissemination Agent as required by this Disclosure Certificate. The Disclosure Dissemination Agent shall have
no duty with respect to the content of any disclosures or notice made pursuant to the terms hereof. The
Disclosure Dissemination Agent shall have no duty or obligation to review or verify any Information or any
other information, disclosures or notices provided to it by the District and shall not be deemed to be acting in
any fiduciary capacity for the District, the Holders of the 2020 Bonds or any other party. The Disclosure
Dissemination Agent shall have no responsibility for the District's failure to report to the Disclosure
Dissemination Agent a Notice Event or a duty to determine the materiality thereof The Disclosure
Dissemination Agent shall have no duty to determine, or liability for failing to determine, whether the District
has complied with this Disclosure Certificate. The Disclosure Dissemination Agent may conclusively rely upon
certifications of the District at all times.
The obligations of the District under this Section shall survive resignation or removal of the Disclosure
Dissemination Agent and defeasance, redemption or payment of the 2020 Bonds.
(b) The Disclosure Dissemination Agent may, from time to time, consult with legal counsel (either
in-house or external) of its own choosing in the event of any disagreement or controversy, or question or doubt
as to the construction of any of the provisions hereof or its respective duties hereunder, and shall not incur any
liability and shall be fully protected in acting in good faith upon the advice of such legal counsel. The
reasonable fees and expenses of such counsel shall be payable by the District.
(c) All documents, reports, notices, statements, information and other materials provided to the
MSRB under this Disclosure Certificate shall be provided in an electronic format and accompanied by
identifying information as prescribed by the MSRB.
SECTION 12. Amendment; Waiver. Notwithstanding any other provision of this Disclosure
Certificate, the District and the Disclosure Dissemination Agent may amend this Disclosure Certificate and any
provision of this Disclosure Certificate may be waived, if such amendment or waiver is supported by an opinion
of counsel expert in federal securities laws acceptable to both the District and the Disclosure Dissemination
Agent to the effect that such amendment or waiver does not materially impair the interests of Holders of the
2020 Bonds and would not, in and of itself, cause the undertakings herein to violate the Rule if such amendment
or waiver had been effective on the date hereof but taking into account any subsequent change in or official
interpretation of the Rule; provided neither the District nor the Disclosure Dissemination Agent shall be
obligated to agree to any amendment modifying their respective duties or obligations without their consent
thereto.
Notwithstanding the preceding paragraph, the Disclosure Dissemination Agent shall have the right but
not the duty to adopt amendments to this Disclosure Certificate necessary to comply with modifications to and
interpretations of the provisions of the Rule as announced by the Securities and Exchange Commission from
time to time by giving not less than 20 days prior written notice of the intent to do so together with a copy of the
proposed amendment to the District. No such amendment shall become effective if the District shall, within 10
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days following the giving of such notice, send a notice to the Disclosure Dissemination Agent in writing that it
objects to such amendment.
SECTION 13. Beneficiaries. This Disclosure Certificate shall inure solely to the benefit of the
District, the Fiscal Agent of the 2020 Bonds, the Disclosure Dissemination Agent, the participating
underwriters (as defined in the Rule), and the Holders from time to time of the 2020 Bonds, and shall create no
rights in any other person or entity.
SECTION 14. Governing Law. This Disclosure Certificate shall be governed by the laws of the State
of California (other than with respect to conflicts of laws).
The District has caused this Disclosure Certificate to be executed, on the date first written above.
ACCEPTED AND AGREED TO:
DIGITAL ASSURANCE CERTIFICATION LLC,
as Disclosure Dissemination Agent
By:
Name:
Title:
CITY OF SANTA CLARITA, as Obligated Person
By: _
Name:
Title:
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EXHIBIT A
NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT
Issuer: City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
Obligated Person: City of Santa Clarita Community Facilities District No. 2016-1 (Vista Canyon)
Name of Bond Issue: $18,055,000 City of Santa Clarita Community Facilities District No. 2016-1
(Vista Canyon) Special Tax Bonds, 2020 Series
Date of Issuance: February , 2020
NOTICE IS HEREBY GIVEN that the City of Santa Clarita Community Facilities District No. 2016-1
(Vista Canyon) (the "District") has not provided an Annual Report with respect to the above -named 2020 Bonds
as required by the Disclosure Certificate of the District. The District anticipates that the Annual Report will be
filed by
Dated: , 20
cc: District, Fiscal Agent
Digital Assurance Certification LLC, as Disclosure
Dissemination Agent
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PARKING SPACES ACQUISITION AGREEMENT
This Parking Spaces Acquisition Agreement (this "Agreement") is made as of
, 2020 (the "Effective Date"), by and between the City of Santa Clarita
("Grantor"), and Vista Canyon Ranch LLC, a California limited liability company ("Grantee"
and, together with the Grantor, the "Parties" and each a "Party").
RECITALS
This Agreement is made and entered into on the basis of the following facts and
understandings of the Parties set forth in these recitals:
A. Grantor is a municipality located within Los Angeles County, California, more
specifically within the Santa Clarita Valley.
B. On April 26, 2011, Grantor adopted Resolution No. 11-23 approving the Vista
Canyon Specific Plan ("Vista Canyon Project"). The approved Vista Canyon Project consists
of: (i) 1,100 single-family, multi -family, and apartment units; (ii) 950,000 square feet of retail,
office, and hotel uses; (iii) a Multi -Modal Transit Center; (iv) a water reclamation plant known as
the Vista Canyon Water Factory; (v) recreational amenities; and, (vi) other related infrastructure,
services and amenities (e.g., roadway improvements, trails, buried bank stabilization) along with
the Vista Canyon Project's Final Conditions of Approval.
C. Grantor, Grantee and Vista Canyon Phase I, LLC, a Delaware limited liability
company ("VCPI"), are parties to that certain Funding and Acquisition Agreement dated as of
April 12, 2016 (the "Acquisition Agreement"). Substantially concurrent herewith and in
accordance with the Acquisition Agreement, Grantor is acquiring from Grantee and VCPI a multi-
story parking facility known as Parking Structure 1 located at the Vista Canyon Project Site (the
"Parking Facility"), as more specifically described on Exhibit A attached hereto and made a part
hereof, which acquisition is being financed through the issuance of Community Facilities District
("CFD") bonds.
D. In the Acquisition Agreement, Grantor and Grantee agreed to cooperate to enter
into an agreement by which Grantee would acquire one or more parking spaces (based on the
construction cost of said spaces) in the Parking Facility to provide required residential parking for
adjacent multi -family uses. These spaces would be used exclusively by Grantee or its assignee
and would not be part of the shared parking pool contemplated by the Vista Canyon Specific Plan.
E. Grantor and Grantee desire to enter into this Agreement by which Grantee will
acquire from Grantor certain easements at the Parking Facility for the use of eighty-four (84)
parking spaces therein (the "Subject Parking Spaces"), and to provide for the respective rights
and obligations of the Parties with regard to the Subject Parking Spaces (such transaction
contemplated hereby being referred to herein as the "Transaction").
F. The recitals set forth above are true and correct and, by this reference, are made an
operative part of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants
and agreements set forth herein, the Parties agree as follows:
1. Transfer of Easements. At the Closing (as defined below), Grantor shall sell,
assign, transfer, convey and deliver to Grantee good and valid title to each and all of the Easements
(as defined in the Easement Agreement for Parking Spaces, in the form of Exhibit A attached
hereto and made a part hereof (the "Easement Agreement")), free of any and all encumbrances
of any kind whatsoever, on the terms and subject to the conditions set forth in this Agreement.
Capitalized terms used herein and not otherwise defined have the respective meanings assigned to
them in the Easement Agreement.
2. Purchase Price. As consideration for the Transaction, Grantee shall not receive any
CFD bond proceeds for the value of the Subject Parking Spaces (and Grantor shall not be required
to pay such amount to Grantee for the acquisition of the Parking Facility under the Acquisition
Agreement). The Parties acknowledge and agree that the value of the Subject Parking Spaces has
been determined by the following formula:
Cost of Construction per parking space of the Parking Facility multiplied by the number of
Subject Parking Spaces, where:
Cost per parking space = [$26,138.00]
Number of Subject Parking Spaces = 84
Total value of Subject Parking Spaces = [$2,195,592.00]
3. Closing.
(a) The closing of the Transaction as provided herein (the "Closing") shall be
substantially concurrent with the closing of the Acquisition Agreement for the Parking Facility
and shall be effected by delivery of documents and consideration at the office of ,
located at , Santa Clarita, California 91355, at a.m./p.m. on
, 2020 or such other date or place as the parties may agree upon in writing. For purposes
of this Agreement, "Closing Date" shall be deemed to mean the calendar day which commences
at 12:01 a.m. Pacific Standard Time, on the date that the Closing occurs.
(b) At the Closing, Grantor and Grantee shall execute, with notarial
acknowledgements, three (3) original counterparts of the Easement Agreement; one (1) original
counterpart shall be delivered to each of Grantor and Grantee and the Parties shall cause the
remaining original counterpart to be recorded in the Official Records of Los Angeles County,
California, immediately following the grant deed for the Parking Facility.
(c) From and after the Closing, each Parry shall execute and deliver, or cause
to be executed and delivered, to each other Parry such instruments and other documents, and shall
take such other actions, as such other Parry may reasonably request (prior to, at or after the Closing)
for the purpose of carrying out or evidencing the Transaction.
4. Representations and Warranties, Indemnification.
(a) Representations and Warranties of Grantor. Grantor represents and
warrants, to and for the benefit of Grantee, as follows, and agrees to indemnify, defend, protect
2
and hold harmless Grantee and its Representatives from and against any damages or losses suffered
by Grantee or its Representatives ("Representatives" shall mean members, shareholders,
managers, directors, officers, employees, agents, attorneys, accountants, advisors and
representatives) arising, directly or indirectly, from any material inaccuracy of such
representations and warranties, from and after the Closing:
(i) Grantor has full legal power, capacity and authority to enter into and
perform the Transactional Agreements, and the Transactional Agreements constitute the valid and
binding obligations of Grantor, enforceable in accordance with their terms, except as the
enforceability thereof may be subject to or limited by bankruptcy, insolvency, reorganization,
moratorium of similar laws of general application affecting the rights of creditors, by general
principles of equity (whether considered in a proceeding at law or in equity), and by limitations or
remedies against governmental entities. "Transactional Agreements" shall mean this
Agreement, the Easement Agreement and all of the other documents and instruments to be
delivered in connection with the Closing.
(ii) The execution and delivery of the Transactional Agreements do not
conflict with, violate, or constitute a default under the terms, conditions, or provisions of any
agreement or instrument to which Grantor is a party, or any law, judgment, or order binding upon
Grantor or the Parking Facility, and will not result in the creation of any lien or encumbrance on
any of the Easements.
(iii) Grantor has the right, title and authority to grant the Easements, free
from the lawful claims of all persons whatsoever.
(b) Representations and Warranties of Grantee. Grantee represents and
warrants, to and for the benefit of Grantor, as follows, and agrees to indemnify, defend, protect
and hold harmless Grantor and its Representatives from and against any damages or losses suffered
by grantor or its Representatives arising, directly or indirectly, from any inaccuracy of such
representations and warranties, from and after the Closing:
(i) Grantee is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of California. Grantee has full legal
power, capacity and authority to enter into and perform the Transactional Agreements, and the
Transactional Agreements constitute the valid and binding obligations of Grantee, enforceable in
accordance with their terms, except as the enforceability thereof may be subject to or limited by
bankruptcy, insolvency, reorganization, moratorium of similar laws of general application
affecting the rights of creditors, and by general principles of equity (whether considered in a
proceeding at law or in equity).
(ii) The execution and delivery of the Transactional Agreements do not
conflict with, violate, or constitute a default under the terms, conditions, or provisions of any
agreement or instrument to which Grantee is a party, or any law, judgment, or order binding upon
Purchaser.
(c) Survival of Representations and Warranties. The representations and
warranties of Grantor and Grantee set forth in this Agreement shall survive indefinitely.
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5. General Provisions.
(a) Notices, Demands and Communications Between the Parties. Any notices,
requests, demands, documents, approvals or disapprovals given or sent under this Agreement from
one Party to another (collectively, "Notices") may be personally delivered (including by
commercial courier service), transmitted by electronic mail ("email") transmission, deposited with
the United States Postal Service for mailing, postage prepaid, or sent by reputable overnight
commercial delivery service (such as Federal Express) to the address of the other Parry as stated
in this Section, and shall be deemed to have been given or sent at the time of personal delivery or
effective email transmission or, if mailed, on the third day (exclusive of Saturdays, Sundays and
days recognized by the federal government or the State of California as legal holidays) following
the date of deposit in the course of transmission with the United States Postal Service or if sent by
overnight delivery, on the day following its deposit with the overnight carrier. Notices shall be
sent as follows:
If to Grantor:
City of Santa Clarita
Attn: Director of Administrative Services
23920 Valencia Boulevard
Santa Clarita, California 91355
email address:
If to Grantee:
Vista Canyon Ranch LLC
Attn: James S. Backer
27651 Lincoln Place, Suite 200
Santa Clarita, California 91387
email address: jbacker@jsbdev.com
(b) Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the successors and assigns of the Parties.
(c) Relationship Between Grantor and Grantee. It is hereby acknowledged by
Grantee that the relationship between Grantor and Grantee is not that of a partnership or joint
venture and that Grantor and Grantee shall not be deemed or construed for any purpose to be the
agent of the other.
(d) Third Parry Rights. ghts. Except as expressly set forth in the Easement
Agreement, the Parties intend that no rights or remedies be granted to any third parry as a
beneficiary of the Transactional Agreements or of any covenant, duty, obligation or undertaking
established herein or therein.
M
(e) Counterparts. This Agreement may be signed in multiple counterparts, each
of which is an original and all of which, together, are one and the same agreement.
(f) Interpretation. As used in this Agreement, masculine, feminine or neuter
gender and the singular or plural number shall each be deemed to include the others where and
when the context so dictates. The word "including" shall be construed as if followed by the words
"without limitation." This Agreement shall be interpreted as though prepared jointly by both
Parties.
(g) Amendment. No termination, amendment or waiver of any of the
provisions of this Agreement shall be effective unless in writing and signed by the parties hereto.
No waiver of any of the provisions of this Agreement shall be effective unless it is in writing,
signed by the party against whom it is asserted, and any such written waiver shall only be
applicable to the specific instance to which it relates and shall not be deemed to be a continuing or
permanent waiver unless so specifically stated.
(h) Severability. The provisions of this Agreement are severable. If any
provision hereof shall be determined to be invalid or unenforceable, it shall not affect the validity
of any remaining provisions herein and all remaining provisions shall be given full force and effect
separately from the invalid or unenforceable provision.
(i) Legal Advice. Each Party represents and warrants to the other the
following: it has carefully read this Agreement, and in signing this Agreement it does so with full
knowledge of any right which it may have; it has received independent legal advice from its
respective legal counsel as to the matter set forth in this Agreement, or have knowingly chosen not
to consult legal counsel as to the matters set forth in this Agreement; and, it has freely signed this
Agreement without any reliance upon any agreement, promise, statement or representation by or
on behalf of the other Party, or its respective agents, employees, or attorneys, except as specifically
set forth in this Agreement, and without duress or coercion, whether economic or otherwise.
0) Captions. The captions in the section headings are for convenient reference
only and in no way define, describe, extend or limit the scope or intent of this Agreement nor the
intent of any provision hereof.
(k) Attorneys' Fees. If any legal action or proceeding arising out of or relating
to this Agreement is brought by either Party to this Agreement, the prevailing Party will be entitled
to receive from the other Parry, in addition to any other relief that may be granted, the reasonable
attorneys' fees, costs, and expenses incurred in the action or proceeding by the prevailing Parry,
all as determined by the court.
[signature page follows]
E
ELECTRONIC TRANSMISSION OF CONTRACT AND SIGNATURE. The Parties agree
that this Agreement may be transmitted and signed by electronic mail by either/any or both/all
Parties, and that such signatures shall have the same force and effect as original signatures, in
accordance with California Government Code section 16.5 and Civil Code section 1633.7.
However, any Party signing and transmitting by electronic mail must promptly follow up such
transmission by sending an ink -signed original to the Party to which the electronic copy was sent.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective
Date.
VISTA CANYON RANCH, LLC, a California limited liability company
By: JSJ Partners, LLC, a California limited liability company
Its: Manager
By: JSB Development, Inc., a California corporation
Its: Manager
:A
James S. Backer, President
By: Valencia Realty Partners, LLC, a California limited liability company
Its: Member
Stephen F. Valenziano, Manager
CITY OF SANTA CLARITA:
Kenneth W. Striplin,
City Manager
City Clerk
APPROVED AS TO FORM:
By
City Attorney
ATTEST:
Signature Page to Parking Spaces Acquisition Agreement
Signature Page to Parking Spaces Acquisition Agreement
EXHIBIT B
EASEMENT AGREEMENT
See Attached
Exhibit B
Recording requested by and
when recorded return to:
Vista Canyon Ranch LLC
Attn: James S. Backer
27651 Lincoln Place, Suite 200
Santa Clarita, California 91387
EASEMENT AGREEMENT FOR PARKING SPACES
This Easement Agreement For Parking Spaces (this "Agreement") is made as of
2020 (the "Effective Date"), by and between the City of Santa Clarita
("Grantor"), and Vista Canyon Ranch LLC, a California limited liability company ("Grantee"
and, together with the Grantor, the "Parties" and each a "Party").
RECITALS
This Agreement is made and entered into on the basis of the following facts and
understandings of the Parties set forth in these recitals:
A. Grantor is a municipality located within Los Angeles County, California, more
specifically within the Santa Clarita Valley.
B. On April 26, 2011, Grantor adopted Resolution No. 11-23 approving the Vista
Canyon Specific Plan ("Vista Canyon Project"). The approved Vista Canyon Project consists
of: (i) 1,100 single-family, multi -family, and apartment units; (ii) 950,000 square feet of retail,
office, and hotel uses; (iii) a Multi -Modal Transit Center; (iv) a water reclamation factory known
as the Vista Canyon Water Factory; (v) recreational amenities; and, (vi) other related
infrastructure, services and amenities (e.g., roadway improvements, trails, buried bank
stabilization) along with the Vista Canyon Project's Final Conditions of Approval.
C. Grantor, Grantee and Vista Canyon Phase I, LLC, a Delaware limited liability
company ("VCPI"), are parties to that certain Funding and Acquisition Agreement dated as of
April 12, 2016 (the "Acquisition Agreement"), pursuant to which Grantor acquired from Grantee
and VCPI, and is now the owner of, a multi -story parking facility known as Parking Structure 1
located at the Vista Canyon Project (the "Parking Facility"), as more specifically described on
Exhibit 1 attached hereto and made a part hereof.
D. Pursuant to the terms of the Acquisition Agreement, Grantor and Grantee have
entered into a Parking Spaces Acquisition Agreement dated as of the Effective Date (the "Parking
Agreement") by which Grantee is acquiring certain rights and obligations with regard to eighty-
four (84) parking spaces at the Parking Facility for the benefit of the respective owners of adjacent
multi -family residential properties described on Exhibit 2 attached hereto and made a part hereof
and the residents thereof (the "Dominant Tenements").
E. Pursuant to the Parking Agreement, Grantor and Grantee desire to enter into this
Agreement to grant to Grantee for each of the Dominant Tenements certain easements at the
Parking Facility for the use of certain parking spaces (the "Parking Spaces") in those portions of
the Parking Facility more specifically described on Exhibit 3 attached hereto and made a part
hereof (the "Easement Areas"), and to provide for the respective rights and obligations of the
Parties with regard to the Parking Spaces.
F. The recitals set forth above are true and correct and, by this reference, are made an
operative part of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants
and agreements set forth herein, the Parties agree as follows:
1. Easements. Grantor hereby grants and conveys to Grantee and its successors,
assigns, agents, permittees or invitees, (a) an exclusive, perpetual easement for the use and
maintenance of the Parking Spaces, together with the installation, maintenance and repair of all
necessary or appropriate fixtures and appurtenances thereto (collectively, the "Tenant Parking
Facilities") in the Easement Areas; (b) a nonexclusive perpetual easement in, over, upon and
through the Parking Facility for ingress and egress purposes to the Easement Areas; and (c) a
nonexclusive, perpetual easement in, under, over, and upon the Parking Facility for electrical lines,
conduits, strands, wires, cables, hardware and junction boxes with regard to gating and other
fixtures and appurtenances to the Parking Spaces as Grantee may deem to be necessary or
appropriate from time to time (the "Parking Fixtures") (collectively, and on the terms and subject
to the conditions set forth in this Agreement, the "Easements").
2. Use. Grantee shall, at its sole cost and expense, use and maintain in good and safe
order and condition and state of repair (including without limitation periodic striping of Parking
Spaces) the Tenant Parking Facilities, and install, maintain, repair and replace, as necessary, the
Parking Fixtures at the Tenant Parking Facilities; provided that use of the Tenant Parking Facilities
shall be limited to residents of each of the Dominant Tenements or their permittees or invitees;
provided further that, if any such maintenance, repair or replacement is required in whole or in
part by any act of Grantor, its successors, assigns, agents, permittees or invitees, Grantor will be
responsible for the cost of such maintenance, repair or replacement. Grantee shall have the further
right to use during the installation, repair and replacement of any Parking Fixtures such areas
adjacent to the easements herein granted as may reasonably be necessary for the performance of
the work and for access to the work during installation, repair and replacement; provided, that such
use is to be made in a manner calculated to cause as little interference with the use of the remaining
portions of the Parking Facility as is reasonably possible. The Parking Fixtures shall at all times
remain the exclusive property of Grantee. Grantor shall not interfere with Grantee's rights and
operations hereunder; provided that Grantor, its successors, assigns, or agents shall have the right
to access the Easement Area for any purpose which is not inconsistent with Grantee's rights herein.
As of the Effective Date, Grantor has engaged Vista Canyon Master Association to manage,
operate and maintain the Parking Facility (the "Manager").
3. Contribution to Operating Costs of Parking Facility. In addition to Grantee's
obligations under Section 2 hereof, on a monthly basis, Grantee shall pay to the Manager (or, if
Vista Canyon Master Association is not then engaged as Manager, to Grantor) Grantee's
2
Proportionate Share of the Operating Costs of the Parking Facility. "Operating Costs" means all
costs and expenses of every kind and nature paid or incurred by Grantor or Manager, as applicable,
in connection with the maintenance, repair, replacement, operation, protection, lighting and
policing of the Parking Facility. The "Grantee's Proportionate Share" of costs are based on the
proportion that the number of Parking Spaces bears to the total number of parking spaces in the
Parking Facility. Grantor or Manager, as applicable, shall on a quarterly basis furnish to Grantee
an expense statement (in reasonable detail) describing the actual Operating Costs incurred for the
monthly period covered by such expense statement and setting forth the amount of Grantee's
Proportionate Share thereof. Grantee shall make payment of such amount within thirty (30) days
after delivery of each such expense statement.
Grantee shall have the right, not more frequently than once per calendar year, after notice
to Grantor or Manager, as applicable, and at reasonable times, to inspect and photocopy Grantor's
or Manager's records (including invoices) relating to Operating Costs. If Grantee disputes any
Operating Costs, Grantee will be entitled, not later than one year following the calendar year in
question, to retain an independent certified public accountant applying generally accepted
accounting industry standards, who is not contracted or compensated on a contingency fee basis
and who has not been employed by Grantee in the preceding five (5) years, to audit such records
for the calendar year in question. If the audit determines that Grantee was overcharged, then,
within thirty (30) days of Grantor's or Manager's inspection of the audit, Grantor or Manager, as
applicable, shall credit Grantee the amount of the overcharge toward the payments of Grantee's
Proportionate Share of Operating Costs next coming due hereunder. If the audit determines that
Grantee has been undercharged, Grantee shall remit to Grantor or Manager, as applicable, such
amount with Grantee's Proportionate Share of the Operating Costs next coming due hereunder.
Grantee agrees to pay the cost of the audit, unless the audit determines that Grantor's or Manager's
calculation of Operating Costs was in error by more than five percent (5%), in which case Grantor
or Manager, as applicable, shall pay for the reasonable cost of the audit (but in no event shall such
payment exceed the amount of the overcharge determined by such audit).
4. Indemnity. To the extent permitted by law, Grantee shall indemnify, defend and
hold Grantor and Manager harmless from any and all claims, damages, liabilities, costs and
expenses, of every nature and kind whatsoever, arising from or on account of the use by Grantee
and its successors, assigns, agents, permittees, invitees and residents of the Dominant Tenements
(and their permittees, guests and invitees) of the easements herein granted.
5. Warranty of Title. Grantor, for itself, its successors and assigns, does hereby
covenant and agree with Grantee, and its successors and assigns, that Grantor at the time of
execution of this Agreement has the good right, title and authority to enter into this Agreement.
6. Successors and Assigns. The easements herein granted are intended to run with the
land and shall be a burden on the Property and bind Grantor and its successors and assigns and
shall inure to the benefit of Grantee and its successors and assigns; provided that, from and after
any such succession or assignment by Grantee of all or any portion of its rights hereunder, Grantee
shall no longer be liable or responsible for any of the obligations of Grantee hereunder arising
thereafter relating to the rights so assigned, and Grantor or Manager, as applicable, shall look
solely to such successor or assignee with regard to such obligations.
3
7. Amendment. No termination or amendment of any of the provisions of this
Agreement shall be effective unless in writing and signed by the parties hereto. No waiver of any
of the provisions of this Agreement shall be effective unless it is in writing, signed by the party
against whom it is asserted, and any such written waiver shall only be applicable to the specific
instance to which it relates and shall not be deemed to be a continuing or permanent waiver unless
so specifically stated.
8. Severability. The provisions of this Agreement are severable. If any provision
hereof shall be determined to be invalid or unenforceable, it shall not affect the validity of any
remaining provisions herein and all remaining provisions shall be given full force and effect
separately from the invalid or unenforceable provision.
9. Captions. The captions and section headings of this Agreement are for convenient
reference only and in no way define, describe, extend or limit the scope or intent of this Agreement
nor the intent of any provision hereof.
10. Attorneys' Fees. If any legal action or proceeding arising out of or relating to this
Agreement is brought by either Party to this Agreement, the prevailing Party will be entitled to
receive from the other Parry, in addition to any other relief that may be granted, the reasonable
attorneys' fees, costs, and expenses incurred in the action or proceeding by the prevailing Parry as
fixed by the court.
11. Request for Notice. Grantee requests that it receive notice of any pending trustee
or foreclosure sale or receivership, bankruptcy or other proceeding affecting the Parking Facility,
sent to the address above or to such further address put of record from time to time.
[signature page follows]
M
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
Effective Date.
VISTA CANYON RANCH, LLC, a California limited liability company
By: JSJ Partners, LLC, a California limited liability company
Its: Manager
By: JSB Development, Inc., a California corporation
Its: Manager
:A
James S. Backer, President
By: Valencia Realty Partners, LLC, a California limited liability company
Its: Member
Stephen F. Valenziano, Manager
CITY OF SANTA CLARITA:
ATTEST:
Kenneth W. Striplin,
City Manager
City Clerk
APPROVED AS TO FORM:
By
City Attorney
Signature Page to Easement Agreement for Parking Spaces
A notary public or other officer completing this certificate verifies only the identity of the individual who
signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity
of that document.
State of California )
County of Los Angeles )
On , 2020, before me, , a Notary Public, personally appeared
James S. Backer and Stephen F. Valenziano, who proved to me on the basis of satisfactory evidence to be
the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
A notary public or other officer completing this certificate verifies only the identity of the individual who
signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity
of that document.
State of California )
County of Los Angeles )
On 2020, before me, , a Notary Public, personally appeared
, who proved to me on the basis of satisfactory evidence to
be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
EXHIBIT 1
LEGAL DESCRIPTION OF PARKING FACILITY
[to be inserted or attached]
Exhibit 1
EXHIBIT 2
LEGAL DESCRIPTION OF DOMINANT TENEMENTS
[to be inserted or attached]
Exhibit 2
EXHIBIT 3
DESCRIPTION OF EASEMENT AREAS
[insert or attach description and/or map of the portion(s) of the
Parking Facility in which the Parking Spaces are to be located and
identify the Dominant Tenement to which such Parking Spaces
attach ]
Exhibit 3
Recording requested by and
when recorded return to:
Vista Canyon Ranch LLC
Attn: James Backer
27651 Lincoln Place, Suite 200
Santa Clarita, California 91387
EASEMENT AGREEMENT FOR SOLAR FACILITIES
AND COMMUNITY IDENTIFICATION SIGNAGE
This Easement Agreement For Solar Facilities and Community Identification Signage
(this "Agreement") is made as of , 2020 (the "Effective Date"), by and
between the City of Santa Clarita ("Grantor"), and Vista Canyon Ranch LLC, a California limited
liability company ("Grantee" and, together with the Grantor, the "Parties" and each a "Party").
RECITALS
This Agreement is made and entered into on the basis of the following facts and
understandings of the Parties set forth in these recitals:
A. Grantor is a municipality located within Los Angeles County, California, more
specifically within the Santa Clarita Valley.
B. On April 26, 2011, Grantor adopted Resolution No. 11-23 approving the Vista
Canyon Specific Plan ("Vista Canyon Project"). The approved Vista Canyon Project consists
of: (i) 1,100 single-family, multi -family, and apartment units; (ii) 950,000 square feet of retail,
office, and hotel uses; (iii) a Multi -Modal Transit Center; (iv) a water reclamation plant known as
the Vista Canyon Water Factory; (v) recreational amenities; and, (vi) other related infrastructure,
services and amenities (e.g., roadway improvements, trails, buried bank stabilization) along with
the Vista Canyon Project's Final Conditions of Approval.
C. Grantor, Grantee and Vista Canyon Phase I, LLC, a Delaware limited liability
company ("VCPI"), are parties to that certain Funding and Acquisition Agreement dated as of
April 12, 2016 (the "Acquisition Agreement"). Substantially concurrent herewith and in
accordance with the Acquisition Agreement, Grantor is acquiring from Grantee and VCPI a multi-
story parking facility known as Parking Structure 1 located at the Vista Canyon Project Site (the
"Parking Facility"), as more specifically described on Exhibit A attached hereto and made a part
hereof.
D. Pursuant to the approved Vista Canyon Specific Plan, a photovoltaic system of not
less than 80,000 square foot is to be constructed on parking structures and commercial buildings
in the town center (Planning Area 2) of the Vista Canyon Project.
E. Grantee desires to construct, operate and maintain community identification
Signage on the north and west exterior walls of the Parking Facility.
F. Grantor and Grantee desire to enter into this Agreement to grant to Grantee certain
easements at the Parking Facility to enable Grantee: (i) to construct, operate and maintain a
photovoltaic system upon that portion of the Parking Facility more specifically described on
Exhibit B attached hereto and made a part hereof (the "Solar Easement Area"); and (ii) to
construct, operate and maintain community identification signage on the north and west exterior
walls of the Parking Facility as more specifically described on Exhibit C attached hereto and made
a part hereof (the "Signage Easement Areas" and, together with the Solar Easement Area, the
"Easement Areas").
G. The recitals set forth above are true and correct and, by this reference, are made an
operative part of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants
and agreements set forth herein, the Parties agree as follows:
1. Easements. Grantor hereby grants and conveys to Grantee and its successors,
assigns, agents, permittees or invitees, (a) a nonexclusive, perpetual easement for the installation,
maintenance, operation, use, repair and replacement of a photovoltaic system (or equivalent),
together with all necessary or appropriate fixtures and appurtenances (collectively, the "Solar
Facilities") in the Solar Easement Area; (b) a nonexclusive, perpetual easement for the installation,
maintenance, operation, use, repair and replacement of community identification signage, together
with all necessary or appropriate fixtures and appurtenances (collectively, the "Signage") in the
Signage Easement Areas; (c) a nonexclusive perpetual easement in, over, upon and through the
Parking Facility for ingress and egress purposes to the respective Easement Areas; and (d) a
nonexclusive, perpetual easement in, under, over, and upon the Parking Facility for electrical lines,
conduits, strands, wires, cables, hardware, junction boxes, and fixtures and appurtenances to the
Solar Facilities and the Signage, all as Grantee may deem to be necessary or appropriate from time
to time.
2. Use. Grantee shall, at its sole cost and expense (and for its sole benefit), install,
maintain, operate, use, repair and replace the Solar Facilities and the Signage in a good, clean and
safe state of condition and repair (including the making of necessary replacements); provided that
if any such maintenance, repair or replacement is required in whole or in part by any act or
omission of Grantor, its successors, assigns, agents, permittees or invitees, Grantor will be
responsible for the reasonable cost of such maintenance, repair or replacement. Grantee shall have
the further right to use during the installation, repair and replacement of any Solar Facilities or
Signage such areas adjacent to the easements herein granted as may reasonably be necessary for
the performance of the work and for access to the work during installation, repair and replacement.
The Solar Facilities and Signage shall at all times remain the exclusive property of Grantee, and
Grantor shall not interfere with Grantee's rights and operations hereunder. Grantor, its successors,
assigns, agents, permittees or invitees shall have the right to use the Solar Easement Area for any
purpose which is not inconsistent with Grantee's rights herein.
3. Indemnity. To the extent permitted by law, Grantee shall indemnify, defend and
hold Grantor, its elected and appointed officials, officers, employees, agents, permittees and
invitees, and each of them, harmless from any and all claims, damages, liabilities, actions, suits,
costs and expenses, of every nature and kind whatsoever, arising from, relating to, or on account
2
of the use by Grantee of the easements herein granted, the exercise by Grantee of the rights herein
granted to it, and the failure by Grantee to comply with its obligations under this Agreement.
4. Warranty of Title. Grantor, for itself, its successors and assigns, does hereby
covenant and agree with Grantee, and its successors and assigns, that Grantor at the time of
execution of this Agreement has the good right, title and authority to grant the easements herein
granted
5. Successors and Assigns. The easements herein granted are intended to run with the
land and shall be a burden on the Property and bind Grantor and its successors and assigns and
shall inure to the benefit of Grantee and its successors and assigns.
6. Amendment. No termination, amendment or waiver of any of the provisions of this
Agreement shall be effective unless in writing and signed by the parties hereto. No waiver of any
of the provisions of this Agreement shall be effective unless it is in writing, signed by the party
against whom it is asserted, and any such written waiver shall only be applicable to the specific
instance to which it relates and shall not be deemed to be a continuing or permanent waiver unless
so specifically stated.
7. Severabilily. The provisions of this Agreement are severable. If any provision
hereof shall be determined to be invalid or unenforceable, it shall not affect the validity of any
remaining provisions herein and all remaining provisions shall be given full force and effect
separately from the invalid or unenforceable provision.
8. Captions. The captions in the section headings are for convenient reference only
and in no way define, describe, extend or limit the scope or intent of this Agreement nor the intent
of any provision hereof.
9. Attorneys' Fees. If any legal action or proceeding arising out of or relating to this
Agreement is brought by either Party to this Agreement, the prevailing Party will be entitled to
receive from the other Parry, in addition to any other relief that may be granted, the reasonable
attorneys' fees, costs, and expenses incurred in the action or proceeding by the prevailing Parry.
10. Request for Notice. Grantee requests that it receive notice of any pending trustee
or foreclosure sale or receivership, bankruptcy or other proceeding affecting the Parking Facility,
sent to the address above or to such further address put of record from time to time.
[signature page follows]
3
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
Effective Date.
VISTA CANYON RANCH, LLC, a California limited liability company
By: JSJ Partners, LLC, a California limited liability company
Its: Manager
By: JSB Development, Inc., a California corporation
Its: Manager
:A
James S. Backer, President
By: Valencia Realty Partners, LLC, a California limited liability company
Its: Member
Stephen F. Valenziano, Manager
CITY OF SANTA CLARITA:
Kenneth W. Striplin,
City Manager
APPROVED AS TO FORM:
J
City Attorney
ATTEST:
City Clerk
Signature Page to Easement Agreement for Solar Facilities and
Community Identification Signage
A notary public or other officer completing this certificate verifies only the identity of the individual who
signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity
of that document.
State of California )
County of Los Angeles )
On , 2020, before me, , a Notary Public, personally appeared
James S. Backer and Stephen F. Valenziano, who proved to me on the basis of satisfactory evidence to be
the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
A notary public or other officer completing this certificate verifies only the identity of the individual who
signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity
of that document.
State of California )
County of Los Angeles )
On 2020, before me, , a Notary Public, personally appeared
, who proved to me on the basis of satisfactory evidence to
be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s)
on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing
paragraph is true and correct.
WITNESS my hand and official seal.
EXHIBIT A
LEGAL DESCRIPTION OF PARKING FACILITY
[to be inserted or attached]
Exhibit A
EXHIBIT B
DESCRIPTION OF SOLAR EASEMENT AREA
[insert or attach description and/or map of the portion(s) of the
Parking Facility on which the Solar Facilities are to be located]
Exhibit B
EXHIBIT C
DESCRIPTION OF SIGNAGE EASEMENT AREAS
[attach descriptions/renderings of the portions of the Parking
Facility on which Signage is to be located]
Exhibit C
PARKING MANAGEMENT SERVICES AGREEMENT
FOR PARKING STRUCTURE 1
This Parking Management Services Agreement For Parking Structure 1 (this
"Agreement") is made as of , 2020 (the "Effective Date"), by and between
the City of Santa Clarita ("City"), and Vista Canyon Master Association, a California non-profit
mutual benefit corporation ("Manager" and, together with the City, the "Parties" and each a
"Party").
RECITALS
This Agreement is made and entered into on the basis of the following facts and
understandings of the Parties set forth in these recitals:
A. The City is a municipality located within Los Angeles County, California, more
specifically within the Santa Clarita Valley.
B. On April 26, 2011, the City adopted Resolution No. 11-23 approving the Vista
Canyon Specific Plan ("Vista Canyon Project"). The approved Vista Canyon Project consists
of: (i) 1,100 single-family, multi -family, and apartment units; (ii) 950,000 square feet of retail,
office, and hotel uses; (iii) a Multi -Modal Transit Center; (iv) a water reclamation plant known as
the Vista Canyon Water Factory; (v) recreational amenities; and, (vi) other related infrastructure,
services and amenities (e.g., roadway improvements, trails, buried bank stabilization) along with
the Vista Canyon Project's Final Conditions of Approval.
C. The City is the owner of a multi -story parking facility known as Parking Structure 1
located at the Vista Canyon Project (the "Parking Facility").
D. Manager is an association formed to manage a common interest development of
certain property owners of a portion of the Vista Canyon Project which includes the Parking
Facility and which property owners will depend upon the Parking Facility to provide their parking
requirements.
E. The City and Manager desire to enter into this Agreement to provide for the
professional management, operation, and maintenance of the Parking Facility. In addition, the
Parties contemplate that additional parking structures will be added to the Vista Canyon Project
and that this Agreement shall serve as a template for the provision of professional management,
operation, and maintenance of such parking structures.
F. The recitals set forth above are true and correct and, by this reference, are made an
operative part of this Agreement.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual covenants
and agreements set forth herein, the Parties agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms. Capitalized terms used in this Agreement shall have the
following meanings unless the context requires otherwise:
(a) "Ancillary Revenues" has the meaning set forth in Section 5.1(b) hereof.
(b) 'Business Day" is a day other than Saturday, Sunday, or a Federal or
California legal holiday.
(c) "Direct Operating Costs" has the meaning set forth in Section 5.2 hereof.
(d) "Effective Date" has the meaning set forth in the introduction to this
Agreement.
(e) "Laws" mean all present and future federal, State, and local statutes,
regulations, ordinances, orders, permits, licenses, and requirements, as they may be amended,
changed, or adopted from time to time.
(f) "Parking Rates" means the rate, fee, charge, interest, penalty, and other
amount (if any) charged for or arising out of the use of the Parking Facility.
(g) "Person" means any individual, corporation, limited liability company,
partnership, joint venture, estate, or trust.
(h) "Public Parking Spaces" means the parking spaces (other than Residential
Spaces) located in the Parking Facility available for general public parking
(i) "Required Residential Spaces" means those parking spaces in the Parking
Facility that are the subject of the Easement Agreement for Parking Spaces dated , 2020
(the "Vista Agreement"), between the City and Vista Canyon Ranch LLC ("Vista"), in which
City sold to Vista eighty-four (84) parking spaces (as more specifically identified on Exhibit B
hereto) in the Parking Facility for use by the residents of adjacent multi -family residential
properties ("Apartment Residents").
Agreement.
0) "Vista Canyon Project" has the meaning set forth in the recitals to this
ARTICLE II
GRANT OF RIGHTS
Section 2.1 Agreement. Manager agrees to supervise, direct, control, manage, and
operate the Parking Facility during the Term in accordance with this Agreement.
Section 2.2 Exhibits. The following Exhibits are attached and form a part of this
Agreement.
1. Exhibit A — Housekeeping and Maintenance Schedule
2. Exhibit B — Required Residential Spaces
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ARTICLE III
TERM
Section 3.1 Term. Unless earlier terminated in accordance with this Agreement, the
term of this Agreement shall commence on the Effective Date and shall run for thirty (30) years,
but shall include the period of renewals described in Section 3.2 below (the "Term").
Section 3.2 Renewal. This Agreement shall automatically renew for successive ten (10)
year terms unless an Event of Default has occurred that has not been cured at the time of such
renewal. Unless otherwise specified herein, such renewal shall be on the same terms and conditions
as this Agreement.
Section 3.3 Effect of Termination. Any termination of the Term shall have no effect
on any monies owing or obligations accrued or incurred by either party prior to the Effective Date
of the termination. Unless the context requires otherwise, "termination" of the Term includes
expiration by passage of time as well as the premature ending of the Term.
ARTICLE IV
USE OF PARKING FACILITY
Manager acknowledges that the Parking Facility will contain eighty-four (84) Required
Residential Spaces and up to five hundred twenty-nine (529) Public Parking Spaces. Manager shall
operate and manage the Parking Facility in a manner that is consistent with the character of each
of these types of spaces.
Section 4.1 Required Residential Spaces. Manager will operate the Parking Facility
in a manner consistent with the terms of the Vista Agreement. Manager will make the Required
Residential Spaces available to Apartment Residents on an exclusive basis.
Section 4.2 Public Parking Spaces. Subject to Section 5.3 hereof, the Manager will
operate the Public Parking Spaces as public parking available to the general public on a first -come,
first -served, 24/7 basis. In addition, Manager will not grant licenses, permits, or leases to the Public
Parking Spaces on a monthly or longer basis. Manager reserves the right to allocate a portion of
the Public Parking Spaces for short-term (hourly) parking, electrical charging spaces, loading
zones, and other special purpose spaces.
Section 4.3 Marking of Parking Spaces. Manager shall keep all parking spaces
adequately marked and identified at all times to distinguish the availability of the parking spaces
for visitor, handicapped or other use, as the case may be, and shall comply with directions from
the City regarding marking and identifying the parking spaces.
Section 4.4 Enforcement of Parking Space Restrictions. Manager shall enforce the
restrictions against the improper or unauthorized use of parking spaces, including, without
limitation, arranging for the prompt towing or booting of any vehicle improperly or impermissibly
parked in a parking space. Manager shall provide and install all signs that are necessary or
appropriate for the enforcement of parking restrictions.
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ARTICLE V
OPERATION AND MANAGEMENT OF PARKING FACILITY
Section 5.1 Standard of Operation.
(a) Manager shall operate and manage the Parking Facility in first-class,
efficient, and proper businesslike manner consistent with industry standards for the operation of
comparable parking facilities in the City of Santa Clarita. Manager will maintain an office within
the Vista Canyon Project site. Manager will publish its contact information (telephone number and
email) to the general public and to the City, and Manager's phone system should be capable of
recording messages.
(b) Manager will use the Parking Facility for the operation of parking functions
only and will not use the Parking Facility for any other activity; provided Manager shall be entitled
to (i) provide charging stations for electric vehicles, and (ii) permit the use of the Parking Facility
for filming and filming -related activities and/or short-term special events, so long as for each such
use: (A) such use does not unreasonably interfere with parking functions at the Parking Facility,
(B) the City shall have provided its written approval of such use, which approval shall not be
unreasonably withheld, conditioned or delayed, and (C) any revenues ("Ancillary Revenues")
generated from such uses ("Ancillary Uses" shall be applied to the costs and expenses incurred
relating to such uses and the general maintenance costs and reserves relating to the Parking
Facility.
Section 5.2 Independent Contractor. Manager shall operate and manage the Parking
Facility as an independent contractor and shall, subject to Section 5.7, employ a staff of efficient,
skilled, and prudent employees in sufficient numbers to perform Manager's duties and obligations
under this Agreement. Nothing contained in this Agreement shall be construed to create or form a
partnership or joint venture between the Parties or render either Parry liable for the debts or
obligations of the other. Manager has no right or authority to bind the City in any manner
whatsoever or to incur any obligations or expenses on behalf of the City or for which the City
could become liable. In operating and managing the Parking Facility, Manager shall be solely
responsible for all Direct Operating Costs. "Direct Operating Costs" means all labor costs
(including benefits and other payroll costs) paid to personnel engaged in the operation of the
Parking Facility; extermination costs, all necessary utilities and services to the Parking Facility
including, but not limited to, electrical power, telephone, cellular telephone, water service, trash
pick-up, degreasing service, re -striping service, speed bump and bott dots replacement; and all
operational costs exclusively related to the operation of the Parking Facility, such as employee
labor, material, supplies, gasoline and propane used for various cleaner equipment and machinery,
LED light fixtures, the cost of insurance (as required in Section 8.1(a)) and fidelity bonds. Direct
Operating Costs also includes subcontracting costs, HVAC maintenance, sump pump
maintenance, costs of trash removal, cleaning costs, costs incurred in the maintenance and repair
of any equipment; general maintenance and repairs, signage, gate arm and card reader service, and
computer hardware, software and repair service.
Section 5.3 Hours of Operation and Regulations. The Parking Facility will operate
24-hours per day, seven (7) days per week. City, in consultation with Manager, will have the right
but not the obligation to establish from time to time written regulations and policies concerning
the use of the Parking Facility. Notwithstanding the foregoing, the City will establish written
regulations and policies that (i) are consistent with the use of the Parking Facility described in this
Agreement and the Vista Agreement, (ii) do not materially increase Manager's duties and
obligations under this Agreement, and (iii) except as otherwise mutual agreed by Manager, do not
provide for any Parking Rate. In connection with any such agreement to charge Parking Rates,
the Parties agree to negotiate, in good faith, an amendment to this Agreement providing for such
Parking Rates and allocating the portion of the Parking Rates that shall be applied to the costs of
maintenance and operation of the Parking Facility.
Section 5.4 Reserves and Reporting.
(a) To the extent that (i) Ancillary Revenues for any calendar year shall exceed
(ii) the costs and expenses incurred relating to the Ancillary Uses and other maintenance and repair
costs incurred by Manager for such calendar year, such excess amount ("Excess Ancillary
Revenues") shall be allocated to reserves for future maintenance and repair costs.
(b) By each April 1 during the Term (commencing April 1, 2021), and within
110 calendar days after the end of the Term, Manager shall provide City with a report that provides
to City, for the previous calendar year, the amount of Ancillary Revenues received by Manager,
the amount paid by Manager for the costs and expenses incurred relating to the Ancillary Uses and
other maintenance and repairs, and the amount of the Excess Ancillary Revenues (if any) added to
reserves for future maintenance and repair costs, or in the case of the final report, of the period less
than a year in length that begins on January 1 and ends on the last day of the Term.
(c) An authorized representative of Manager will sign each report required by
this Section, which signature will serve as Manager's certification as to the accuracy and
completeness of the information contained in the report.
Section 5.5 Books and Records.
(a) Manager shall maintain at an office in the Vista Canyon Project site
complete and accurate books and records of account in accordance with generally accepted
business and accounting practices with respect to the operation, management, and maintenance of
the Parking Facility and shall record in these books and records the information required to be
reported by Manager pursuant to Section 5.4. The books and records of account shall be retained
by Manager for four (4) years following the end of each calendar year during the Term, and, upon
request by City, Manager shall (at no expense to City) deliver possession of the books and records,
or accurate and complete copies thereof, to City. In addition, upon expiration or termination of this
Agreement, and for four (4) years thereafter, Manager shall make available to City for inspection
and copying (at no expense to City) the books and records of the four (4) years preceding the
expiration or termination of this Agreement.
(b) Audits. City and its authorized representatives may conduct at any time with
reasonable notice an audit or inspection of the books and records of Manager relating to the
operations, management and maintenance of the Parking Facility.
(c) Survival. The obligations of Manager under this Section 5.5 shall survive
the termination of the Term.
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Section 5.6 No Compensation. Manager shall not be entitled to compensation for its
services rendered pursuant to this Agreement.
Section 5.7 Subcontracts and Assignment. Manager may enter into subcontracts with
third parties to perform some or all of Manager's responsibilities as described in this Agreement,
provided (i) each such subcontract shall be subject to and consistent with this Agreement and (ii)
Manager shall remain fully obligated and responsible under this Agreement to the same extent as
if Manager had not entered into the subcontract.
Section 5.8 Claims and Demands. Manager shall notify City of any claim, demand, or
charge asserted or proposed to be asserted against or upon the Parking Facility within ten (10)
calendar days of receiving notification thereof.
Section 5.9 Compliance with Laws and Contracts. Throughout the Term, Manager
shall comply with all Laws (including, without limitation, Americans with Disabilities Act)
relating to Manager's duties and obligations under this Agreement and shall observe and comply
with the requirements of all policies of insurance with respect to the Parking Facility and any
machinery or equipment used in connection with the Parking Facility. Without limiting the
foregoing sentences, Manager will comply with all applicable Laws for the cleanup of any
hazardous materials or liquids that may spill as a result of accidents, fires, or other events. As used
in this Agreement, "hazardous materials" means (a) all substances, materials, and wastes that
are or become regulated or classified as "hazardous substances," "hazardous wastes," "hazardous
materials," "toxic substances," "pollutants," "contaminants" or other similar terms under any
federal, state, or local laws, rules, orders, regulations, statutes, ordinances, codes, decrees or
requirements; and (b) any petroleum or refined petroleum product, asbestos, polychlorinated
biphenyl, material or substance designated as a hazardous substance pursuant to 33 USCS § 1321
or listed pursuant to 33 USCS § 1317, any flammable explosive, or and radioactive material
Section 5.10 Access to the Parking Facility. The Parking Facility is property of City
and the City has exclusive title to the Parking Facility. Nothing in this Agreement is intended to
reduce City's right to enter it at any time for any purpose. Without limiting the preceding sentence,
City has the right to enter the Parking Facility in accordance with Article IX of this Agreement.
Section 5.11 Customer Relations. Manager shall provide a high level of customer
service by employing friendly, helpful, customer -oriented personnel. Manager shall handle all
complaints from the general public regarding parking in a courteous and professional manner.
Except to the extent City may choose from time to time to vary from this procedure, Manager shall
receive and handle all communications and complaint from customers. To the extent a
communication relates to a matter solely in the discretion or authority of City, Manager shall direct
the person to City.
Section 5.12 Security.
(a) Manager shall operate and maintain the close circuit television system
("CCTV") at the Parking Facility as installed as of the Effective Date. CCTV video shall be
archived for a period of not less than ninety (90) days after date of recording. At the option of the
City from time to time, and at its sole cost and expense, the CCTV may be upgraded or otherwise
replaced, and/or additional security and control measures (such as parking control equipment and
in
car/stall counting equipment) may be installed, and such equipment shall thereafter be operated
and maintained by Manager; provided that such operation and maintenance do not materially
increase Manager's Direct Operating Costs. If any such operation and/or maintenance is
reasonably anticipated to materially increase Manager's Direct Operating Costs, the Parties shall
negotiate an equitable resolution thereof prior to the installation of such equipment.
(b) Manager shall cause security personnel to patrol the Parking Facility.
Manager intends to enter into an agreement with another parry (subcontractor) or parties to provide
such security. In the event the Manager contracts with another parry to provide security, the
agreement with such parry (subcontractor) shall contain provisions acceptable to City whereunder
such parry (subcontractor) indemnifies City and whereunder City is named as an additional insured
and shall consult with the City regarding the level and type of insurance required. Manager shall
report to City any change in its security services if such change represents a material and
substantial reassignment of security personnel. Manager shall promptly report to Los Angeles
County Sheriff's Department and City any incidents involving criminal activity in or adjacent to
the Parking Facility.
(c) City expressly acknowledges that the Manager is not a security firm and
that Manager will subcontract the security services required pursuant to this Agreement.
(d) Nothing in this Agreement shall create any liability to third parties for Third
Parry Acts. A "Third Party Act" is a criminal or other act or omission by a parry or entity other
than Manager.
Section 5.13 Violation of Rules and Regulations; Abandoned Vehicles.
(a) Manager may issue rules and regulations for use of the Parking Facility,
which rules and regulations are subject to the City's approval (the "Rules and Regulations").
Manager may terminate parking privileges in the event any Person using the Parking Facility fails
to comply with the Rules and Regulations.
(b) Manager may tow without notice any vehicles that are illegally stored or
abandoned in the Parking Facility. Manager will notify the City if it removes any illegally stored
or abandoned vehicles.
ARTICLE VI
MAINTENANCE OF PARKING FACILITY
Section 6.1 Maintenance and Repair. Except as otherwise provided herein, the
Manager shall maintain the Parking Facility in a good, safe and clean condition and working order.
Manager shall comply with the maintenance and cleaning responsibilities and frequencies as set
forth in Exhibit A (the "Housekeeping and Maintenance Schedule").
Section 6.2 Manufacturer's Recommendations. Where Manager is required to
perform any service on any part of the Parking Facility, including equipment installed therein,
Manager shall do so in compliance with applicable manufacturers' recommendations and warranty
requirements.
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Section 6.3 Inspections and Reports. Manager acknowledges that it is not the City's
intent to post City personnel in the Parking Facility to conduct periodic inspections of the Parking
Facility, but to rely upon the inspections that Manager is to perform as described in Exhibit A.
Manager shall develop forms, reasonably acceptable to City, upon which the results of any daily,
weekly, monthly, or other regular inspections shall be recorded. Manager shall provide a copy of
any such forms to City.
Section 6.4 Cleaning. Manager shall provide cleaning services throughout the Parking
Facility, including stairwells, elevators, all parking and driveway areas, and storage areas and all
other areas described in Exhibit A. Manager shall perform these cleaning services on a schedule
consistent with Exhibit A. Manager shall clean and remove any graffiti and clean up after any
vandalism.
Section 6.5 Elevators. Manager shall perform the elevator services described in
Exhibit A as a Manager responsibility. Manager shall secure and pay for a maintenance agreement
for the elevators with a reputable and responsible elevator maintenance company. City shall be
made a third -parry beneficiary of that agreement. Manager shall provide a copy of any written
reports that Manager creates or receives related to the elevators.
Section 6.6 Si2na2e and Graphics. Manager shall maintain and post signage (a) that is
required by any Laws, (b) that is prudent, or appropriate to facilitate vehicular and pedestrian
circulation throughout the Parking Facility, and (c) that is necessary or advisable to allow for
enforcement of parking space restrictions and any applicable regulations. Manager shall post
temporary signage that is required by any Laws or that is reasonably needed to warn patrons of
malfunctioning equipment and hazards, including hazards caused by weather and accidents.
Manager will perform the housekeeping and preventative maintenance services described in
Exhibit A. Manager will maintain, repair, and replace the signage and graphics as necessary.
Section 6.7 Structural Systems. Manager shall perform the housekeeping services for
structural systems described in Exhibit A. Notwithstanding the foregoing, Manager's inspection
responsibilities shall be limited to performing a walk-through appraisal and reporting to City any
conditions that are observed, and the City will be responsible for performing any inspections to be
performed by licensed engineers or for performing any condition appraisal.
ARTICLE VII
INDEMNIFICATION
Section 7.1 Indemnity.
(a) To the maximum extent allowed by law, Manager shall defend, indemnify,
and save harmless Indemnitees from and against all Charges that arise in any manner from, in
connection with, or out of Manager's performance of, or failure to perform, its obligations under
this Agreement or as a result of acts or omissions of Manager or its contractors, subcontractors or
anyone directly or indirectly employed by Manager or its contractors or subcontractors or anyone
for whose acts Manager or its contactors or subcontractors may be liable. Notwithstanding the
foregoing, Manager shall not be required to defend, indemnify, and save harmless Indemnitees
against liability for Charges to the extent they are proximately caused by or resulting from the
negligence or intentional or willful acts, in whole or in part, of Indemnitees.
in
(b) To the maximum extent allowed by law, City shall defend, indemnify, and
save harmless Manager Indemnitees from and against all Charges that arise in any manner from,
in connection with, or out of City's performance of, or failure to perform, its obligations under this
Agreement or as a result of acts or omissions of City or its contractors or anyone directly or
indirectly employed by City or its contractors or anyone for whose acts City or its contractors may
be liable. Notwithstanding the foregoing, City shall not be required to defend, indemnify, and save
harmless Indemnitees against liability for Charges to the extent they are proximately caused by or
resulting from the negligence or intentional or willful acts, in whole or in part, of Manager
Indemnitees.
(c) As used in this Article VIL "Charges" means claims, judgments, costs,
damages, losses, demands, liabilities, duties, obligations, fines, penalties, royalties, settlements,
and expenses (included without limitation within "Charges" are (1) interest and reasonable
attorneys' fees assessed as part of any such item, and (2) amounts for alleged violations of
sedimentation pollution, erosion control, pollution, or other environmental Laws); "Indemnitees"
means City and its officers, officials, independent contractors (excluding Manager), agents, and
employees, including its City Manager; and "Manager Indemnitees" means Manager, its
members, employees, officers, directors, independent contractors, and agents.
(d) Nothing in this Section 7.1 shall affect any warranties in favor of City or
Manager that are otherwise provided in or arise out of this Agreement. This Section 7.1 is in
addition to and shall be construed separately from any other indemnification provisions that may
be in this Agreement.
(e) This Section 7.1 shall remain in force despite termination of the Term.
(f) In performing the Parties' respective duties under subsection 7.1(a) and (b)
above, City and Manager, as applicable, shall each at its sole expense defend Indemnitees or
Manager Indemnitees, as the case may be, with legal counsel of its choice reasonably acceptable
to the other. Manager or City, as applicable, shall deliver to the other copies of documents served
in any legal proceeding arising in connection with the Parking Facility. Whenever requested by
City or Manager, as applicable, the requested Parry shall advise the other Parry as to the status of
such legal proceeding; provided, however, that any such consultation shall not cause City or
Manager to waive any claim of privilege, including, without limitation, attorney -client privilege.
If Manager or City, as applicable, fails to defend any such legal proceeding, then the indemnified
Parry shall have the right (but not the obligation) to defend the proceeding at the indemnifying
Parry's expense. Neither Manager nor City shall settle any such legal proceeding without the other
Parry's prior written consent unless the effect of such settlement shall be to release all Indemnitees
from all liability with respect to such legal proceeding (and all claims and liabilities asserted
therein).
ARTICLE VIII
INSURANCE AND CASUALTY
Section 8.1 Minimum Requirements of Insurance.
(a) Manager shall purchase and continuously maintain, at its own expense,
during the Term an insurance policy with such limits as are customarily maintained by facilities
in
of like -kind in California, provided that such insurance policy shall contain, at a minimum, the
following coverage:
Commercial General Liability, covering
• premises/operations;
• products/completed operations;
• broad form property damage;
• personal injury;
• contractual liability;
• independent contractors, if any are used in the performance of this contract;
• City of Santa Clarita must be named additional insured, and an original of the endorsement
to effect the coverage must be attached to the certificate (if by blanket endorsement, then
agent may so indicate in the GL section of the certificate, in lieu of an original
endorsement); additional insured coverage shall be primary and non-contributing
• combined single limit not less than $1,000,000 per occurrence;
Workers' Compensation Insurance, covering
• statutory benefits;
• covering employees required to be covered under the laws of the State of California;
Automobile Liability Insurance, covering
• vehicles owned, hired, leased, rented or borrowed by Manager;
• property damage, bodily injury or death and medical expenses from the use of Manager
owned, hired, leased, rented or borrowed vehicles;
• combined single limit not less than $1,000,000 per claim applicable to this contract;
• City of Santa Clarita must be named designated insured;
Insurance shall be provided by:
• companies authorized to do business in the State of California
• companies with Best rating of A- (VII) or better.
Insurance shall be evidenced by a certificate:
• Manager will provide a new certificate each time a policy is renewed or replaced with a
new policy
• certificates shall be addressed to:
City of Santa Clarita
Attention: Director of Public Works
23920 Valencia Boulevard, Suite 302
Santa Clarita, California 91355
Excess/Umbrella Policy
• required limits of coverage amounts may be reached by a combination of primary and
excess/umbrella insurance policies
(b) City shall purchase and continuously maintain fire and extended coverage
insurance covering the Parking Facility in an amount that shall not be less than one hundred percent
(100%) of the full replacement cost, subject to customary deductibles, and the City's personal
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property contained therein; however, within thirty (30) days after presentation of invoices therefor,
Manager shall reimburse City for all premiums allocable to the Parking Facility and shall be
responsible for the payment of any deductibles in connection with insurance claims thereon. The
insurance policy shall be broad in terms of perils covered, and shall in all events cover losses from
fire, vandalism, malicious mischief, and loss or damage from lighting, windstorm, hail, explosion,
riot, riot attending a strike, civil commotion, weight of snow and ice, aircraft, vehicles, and smoke,
and, in accordance with City policy (as in effect from time to time), earthquake and/or flood. The
City's insurance policy must identify Manager as a named additional insured, and an original of
the endorsement to effect the coverage must be attached to the certificate (if by blanket
endorsement, then agent may so indicate in the GL section of the certificate, in lieu of an original
endorsement). City does hereby waive all rights of recovery, if any, against Manager for damage
to, or destruction of, the Parking Facility in the event such damage or destruction is caused by fire
or other casualty only to the extent and in the amount such damage or destruction or casualty is
covered under the City's fire and extended coverage insurance policy.
Section 8.2 Adiustment of Losses. City and Manager shall adjust losses under their
respective insurance policies related to the Parking Facility as promptly as practicable and with
due regard to the interests of the other parry.
Section 8.3 No Release of Liability. No acceptance or approval of any insurance policy
by Manager or City shall relieve or release the other parry from any liability, duty, or obligation
under the provisions of this Agreement.
Section 8.4 Casualty. If the Parking Facility is damaged by fire or other casualty, then
the provisions of this Section 8.4 shall determine whether this Agreement is terminated and the
duration of any suspension of the obligations of the parties hereunder. If the fire or casualty results
in only a portion of the Parking Facility being usable for its intended purpose, then this Agreement
shall remain in full force and effect with respect to the portion of the Parking Facility that is still
usable and the payments and obligations of the parties hereunder shall be equitably adjusted based
upon the portion of the Parking Facility that is in operation. If the fire or other casualty results in
the Parking Garage being unusable for its intended purpose, then the rights and obligations of City
and Manager hereunder shall be suspended until such time as the Parking Facility is rebuilt or
restored. Upon substantial completion of such restoration, Manager shall manage the Parking
Facility in accordance with the provisions of this Agreement; provided _that if any such
reconstruction requires materially more or less services of Manager than those described herein,
the financial terms of this Agreement shall be equitably adjusted as a result of Manager providing
materially more or fewer services. If the fire or casualty results in the Parking Facility being
unusable for its intended purpose and it is not rebuilt, restored or repaired prior to the expiration
of the Term, then this Agreement shall be deemed terminated as of the date of such casualty.
ARTICLE IX
DEFAULT AND REMEDIES
Section 9.1 Defaults. The following events shall be deemed a default by Manager under
this Agreement:
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(a) The failure or refusal of Manager to perform fully and promptly any act or
obligation required under this Agreement or to comply otherwise with any term or provision of
this Agreement;
(b) The entry of an order of relief for Manager by a court of competent
jurisdiction under any bankruptcy or insolvency laws;
(c) The entry of an order of appointment by any court or under any Law of a
receiver, trustee, or other custodian of the property, assets, or business of Manager;
(d) The assignment by Manager of all or any material part of its property or
assets for the benefit of creditors other than its stock or other equity interest in an unregulated
subsidiary or joint venture; or
(e) The levy of execution, attachment, or other taking of property (other than
Manager's stock or other equity interest in an unregulated subsidiary or joint venture), assets, or
interest under this Agreement of Manager by process of law or otherwise in satisfaction of any
judgment, debt, or claim, unless postponed by appeal, furnishing of bond, or other contest by
Manager as permitted by law.
Section 9.2 Opportunity to Cure. Upon the occurrence of any of the defaults contained
in Section 9.1(a), City shall provide to Manager written notice of such default and Manager shall
have thirty (30) days after the date of receipt of such written notice to cure such default. If the
nature of the default contained in Section 9.1(a) is such that the default cannot reasonably be cured
within that thirty (30) day period (and such default is not in the payment of money), then Manager
shall have an additional reasonable amount of time to cure the default, provided that Manager has
begun its efforts to cure the default within that thirty (30) day period and Manager cures the default
in a commercially reasonable manner and time. There is no notice requirement or cure period for
the other defaults listed in Section 9.1. Manager's failure to cure a default within the applicable
time period, if any, shall be an "Event of Default".
Section 9.3 Remedies for Default by Manager. This Agreement shall be enforceable
by actions for specific performance or injunction in addition to any other remedies available at law
or in equity, including recovery of all attorneys' fees and court costs. If an Event of Default has
occurred, City may, without further notice or demand, terminate the Term, in which event,
Manager immediately shall surrender the Parking Facility to City; and, if Manager fails to do so,
City shall have the right, without waiving any other remedy for possession or arrears in payments,
to enter upon and take control of the Parking Facility and to expel or remove Manager and any
other person (other than Apartment Residents) who may be occupying the Parking Facility or any
part of the Parking Facility. Pursuit of any remedy under this Agreement shall not preclude the
pursuit of any other remedy provided for in this Agreement or any other remedy provided in law
or equity, nor shall pursuit of any remedy provided in this Agreement constitute a forfeiture or
waiver of any amounts due to City under this Agreement or of any damages accruing to City by
reason of the violation this Agreement. Notwithstanding any contrary provision contained in this
Agreement, neither City nor any person claiming through City shall be entitled to recover from
Manager any consequential, special, or punitive damages.
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Section 9.4 Default by City. City's failure to perform any act or obligation required
under this Agreement (specifically, under Article VII or Article VIII) or to comply otherwise with
any term or provision of this Agreement shall be deemed a default by City.
Section 9.5 City's Opportunity to Cure and Manager's Remedies.
(a) Upon the failure of City to perform any of its obligations under this
Agreement (specifically, under Article VII or Article VIII), Manager shall provide written notice
of default to City, and City shall have thirty (30) calendar days after the date of receipt of such
written notice to cure such default. If the nature of the default is such that City reasonably cannot
cure the default within that thirty (30) day period (and such default is not in the payment of money),
then City shall have an additional reasonable amount of time to cure the default, provided that City
cures the default in a commercially reasonable manner and time. City's failure to cure a default
within the applicable time period, if any, shall be an "Event of Default".
(b) If City commits an Event of Default, then Manager may pursue all remedies
available to Manager, at law or in equity. Notwithstanding any contrary provision contained in this
Agreement, neither Manager nor any person claiming through Manager shall be entitled to recover
from City any consequential, special, or punitive damages.
Section 9.6 Failure to Perform and Self Help.
(a) In addition to other remedies provided in this Agreement, if either parry fails
to perform its obligations under this Agreement and such failure arises to an Event of Default,
then, unless otherwise agreed, the other parry may perform whatever action is reasonably necessary
to cure the problem at the expense of the parry that committed the Event of Default, provided that:
(i) the other parry provides written notice to the non -performing parry
specifying the action requested and the non -performing parry fails to start the requested
work within ten (10) calendar days following the giving of such notice; or
(ii) the other parry provides written notice to the non -performing parry
specifying the action requested and the non -performing party fails to complete the
requested work within thirty (30) calendar days following the giving of such notice by the
other parry; provided, in the event that the requested work requires more than thirty (30)
calendar days to complete, the non -performing parry shall have a reasonable amount of
time to complete the work so long as such work is pursued in a diligent manner.
This Section is not to be construed to restrict either parry's rights or remedies under other Sections
of this Agreement.
(b) Before either parry shall be required to reimburse the other party for actions
done or expenses made arising out of the failure of the non -performing parry to comply with this
Agreement, the other parry shall provide the non -performing parry an itemized invoice with
reasonable supporting documentation. The non -performing parry shall reimburse the other parry
within ten (10) Business Days following its receipt of such invoice. Notwithstanding the
foregoing, the Manager acknowledges that its right to receive reimbursement from the City for
any such costs and expenses incurred may be limited unless Manager abides by any procurement
or contracting requirements that the City is required by Law to abide.
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Section 9.7 Emer2ency. In the event of an emergency, either Parry may initiate
corrective measures to prevent or mitigate any impending damage to or catastrophic effect on the
Parking Facility or danger to natural persons resulting from the destruction or failure of any facility
or component of the Parking Facility after (a) making reasonable efforts under the circumstances
to notify the other Parry of the emergency and (b) giving the other Party a reasonable amount of
time under the circumstances to take corrective action. The Parties shall share the costs of such
action in proportion to their responsibilities under this Agreement.
Section 9.8 Force Maieure. If the performance of any act required by the City or
Manager is directly prevented or delayed by reason of strikes, lockouts, labor disputes, acts of
God, fire, floods, epidemics, freight embargoes, or other causes beyond the reasonable control of
the Parry required to perform an act, that Parry shall be excused from performing that act for a
period of time equal to the period of time of the prevention or delay. In the event of the existence
of such delay, the Parry claiming the delay shall notify the other Parry in writing of that fact within
10 calendar days after the beginning of any such delay.
Section 9.9 Non -Waiver. No delay or omission of either Parry in the exercise of any
right or remedy accruing upon any default or Event of Default on the part of the other Parry shall
impair such right or remedy or be construed to be a waiver thereof, nor shall such delay or omission
constitute approval of or acquiescence in a breach under this Agreement.
ARTICLE X
MISCELLANEOUS
Section 10.1 Survival. It is understood and agreed that whether or not specifically
provided herein, any provision of this Agreement that by its nature and effect is required to be
kept, observed, or performed after the termination of the Term shall survive the Term, whether the
Term ends prematurely or by the passage of time, and shall remain binding upon and for the benefit
of the parties until fully observed, kept, or performed. Provisions in this Agreement requiring
specific rights, duties, or obligations to survive the Term are not to be construed to limit this
Section.
Section 10.2 Good Faith. The parties to this Agreement agree to cooperate and otherwise
act in good faith with respect to the promises and duties contemplated by this Agreement and the
efficient and safe operation, management, and maintenance of the Parking Facility.
Section 10.3 Assignment. Except as permitted in this Section, Manager shall not assign
this Agreement or any benefit accruing under this Agreement to any parry without first obtaining
the prior written consent of the City.
(a) Manager may assign this Agreement or any portion there or any benefit
accruing under this Agreement to any parry who is not a Prohibited Person (hereinafter defined)
without first obtaining the prior written consent of City. In addition, Manager shall be permitted
to assign all or a portion of this Agreement to an entity that is wholly owned or controlled by
Manager or Vista. No assignment shall relieve Manager of responsibility for the Manager's duties
and obligations under this Agreement, except under the following circumstance: (i) the City
consents (in the exercise of its sole and absolute discretion) to an assignment of this Agreement by
executing an instrument other than this Agreement and such written instrument expressly relieves
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Manager of any further liability for obligations accruing after the effective date of the assignment,
(ii) Manager assigns all or part of this Agreement to a permitted assignee who is not a Prohibited
Person, and (iii) the assignee expressly assumes in writing (by an instrument in form and substance
reasonably satisfactory to the City) all of the obligations under this Agreement accruing after the
date of the assignment. Any unauthorized assignment of this Agreement shall be null and void and
shall constitute a default under this Agreement.
(b) Manager shall have the right, without the consent of City, to delegate its
duties and responsibilities to a third parry provided that no such delegation results in Manager
being released from its obligations under this Agreement.
(c) "Prohibited Person" shall mean any of the following:
(i) Any Person (A) that is in default or in breach of its obligations under
any written agreement (including, but not limited to, any ground lease, any loan agreement
or mortgage, or regulatory agreement) with City, or (B) that directly or indirectly controls,
is controlled by, or is under common control with a Person that is in default or in breach of
its obligations under any written agreement with City, unless this default or breach has
been waived in writing by City.
(ii) Any Person (A) that has been convicted in a criminal proceeding of
a felony for any crime involving moral turpitude or that is an organized crime figure or is
reputed (as determined according to the criteria specified in the next paragraph) to have
substantial business or other affiliations with an organized crime figure, or (B) that directly
or indirectly controls, is controlled by, or is under common control with a Person that has
been convicted in a criminal proceeding of a felony for any crime involving moral turpitude
or that is an organized crime figure or is reputed to have substantial business or other
affiliations with an organized crime figure.
The determination as to whether any Person is an organized crime figure or is reputed to
have substantial business or other affiliations with an organized crime figure or directly or
indirectly controls, is controlled by, or is under common control with a Person that is an
organized crime figure or is reputed to have substantial business or other affiliations with
an organized crime figure shall be within the sole discretion of City.
(iii) Any "enemy" or "ally of enemy" with which trading is prohibited by
the Trading with the Enemy Act, codified at 50 USCS Appendix Section 3, as amended.
Section 10.4 Notices. All notices, correspondence, reports, or other written documents
exchanged between the Parties under this Agreement must be addressed to the City or Manager as
set forth below or as the City or Manager may later designate in writing, and shall be sent through
the United States mail, duly registered or certified, return receipt requested, with postage prepaid
thereon, or by any other method providing positive proof of delivery.
(a) As to City:
City of Santa Clarita
Attention: Director of Public Works
23920 Valencia Boulevard, Suite 302
Santa Clarita, California 91355
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(b) As to Manager:
Vista Canyon Master Association
Attn: Charles Gill
27651 Lincoln Place, Suite 200
Santa Clarita, California 91387
Section 10.5 Successors. This Agreement shall be binding upon and inure to the benefit
of each of the parties hereto and its respective successors and permitted assigns.
Section 10.6 Severability. The unenforceability, invalidity, or illegality of any provision
of this Agreement shall not render any other provision of this Agreement unenforceable, invalid,
or illegal to the extent practicable or provided by Law.
Section 10.7 Counterparts. This Agreement may be executed in duplicate originals, one
for each Parry, each of which duplicate original shall be deemed to be an original, but all of which
shall constitute one and the same Agreement.
Section 10.8 Choice of Law and Venue. This Agreement is governed by California law
without regard to principles of conflicts of law. Any legal action arising out of this Agreement
must be brought in the Los Angeles County Superior Court.
Section 10.9 Attorneys' Fees. In the event of any legal proceeding arising from or
related in any way to a breach of or an enforcement or interpretation of this Agreement, the
prevailing Parry will be entitled to recover reasonable attorneys' fees and court costs from the other
Parry.
Section 10.10 Entire Agreement. This Agreement, together with its Exhibits, contains all
of the agreements, and supersedes any and all other agreements, either oral or in writing, between
the Parties with respect to the subject matter herein.
Section 10.11 Performance of Government Functions. Nothing contained in this
Agreement shall be deemed or construed to stop, limit, or impair City from exercising or
performing any regulatory, policing, legislative, governmental, or other powers or functions.
Section 10.12 Modifications. Any modification of this Agreement shall be effective only
if it is in writing and signed by all Parties.
Section 10.13 Warranty of Authority. Each Parry covenants, represents, and warrants
to the other Parry that the signatory of the covenanting Parry has the power and authority to execute
this Agreement upon the terms and conditions stated herein.
[signature page follows]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as
of the Effective Date.
CITY OF SANTA CLARITA
By:
Name:
Title:
VISTA CANYON MASTER ASSOCIATION
By
Name:
Title:
Signature Page to Parking Management Services Agreement
*A:I1:1 111 r_1
PS 1 MAINTENANCE RESPONSIBITIES PERFORMED BY MANAGER
Electrical/Lighting/Power
1
Check all lighting to ensure functioning in parking
Daily
structure, stairwells, elevators
2
Check photo cell controls and/or timers
Adjust as needed
3
Repair/replace any electrical systems including
As needed
fixtures, fixture guards, conduit, wiring, switches,
controls and breaker panels
4
Replace or repair malfunctioning, damaged or
As needed
missing lighting fixtures
Cleaning
1
Sweep stairwells, elevator floors; damp mop as
necessary; litter pickup throughout structure;
empty trash cans and replace liners
Daily
2
Sweep floors in all mechanical rooms, elevator
equipment rooms, bike storage rooms
Once a week
3
Clean all glass surfaces, glass in doors, elevator
stainless steel
Daily
4
Clean doors, casings, railings and door hardware
Weekly
5
Clean all structure signage
Monthly
6
Dust elevator cab walls and dust stairwell walls
Monthly
7
Visually check floor areas for oil or liquids to
prevent slips and falls; resolve as necessary
Daily
8
Pressure wash areas in structures
As needed
Elevators
1
Check for normal operation including buttons,
Daily
indicator lights, smooth ride and door operations
2
Perform preventive maintenance activities
Contracted with elevator installer per
their schedule
3
Replacement of parts/repairs related to Preventive
Contracted with elevator installer
Maintenance
4
Replacement of parts/repairs due to vandalism or
Accomplished by Elevator contractor;
beyond Preventive Maintenance Agreement
paid by Structure Operating Expense
Pest Control
1
Manage a pest control exterminator under a service
Service agreement requires a monthly
agreement
inspection and daily response to any
evident issues
Exhibit A
Activity
Fire Alarms, Fire Extinguishers, Sprinkler Monitoring; Emergency Call Boxes, CCTV
1
Contract for monitoring of fire alarm/fire sprinkler
24/7; monitoring by certified Central
monitoring service; monitor systems 24/7
Station; maintenance by original
vendor
2
Contract for montoring of emergency callboxes
24/7; monitoring by certified Central
Station; maintenance by original
vendor
3
Visually check fire extinguisher locations to make
Daily
sure they have not been vandalized or are missing
4
Perform annual testing on fire extinguishers
Annually by certified vendor
5
Perform semi-annual alarm systems and flow
Semi-annual; inspections by certified
triggers on sprinkler system to appropriate NFPA
(original) alarm vendor
standards
6
Perform annual fire sprinkler testing for flow and
Annual; inspections by certified
alarm triggering per NFPA Standards
(original) alarm vendor
7
Visually check all standpipe valve connections to
Weekly by security vendor
insure valve is tight and threads are not damaged
8
Monitor CCTV activity via motion sensitive cameras
24/7 by security vendor
; respond to perceived security issues or concerns
9
Maintain CCTV video history
For a 90 day period
10
Maintain backflow prevention devices on domestic
Visual inspections performed by
and fire service water lines; perform annual
security staff; certifications performed
inspections and certifications as requested by SCV
by certified vendor
Water.
Plumbing, Drainage/Ventilation Equipment
1
Check and clean interior drains and collection boxes
Monthly
2
Check and clean roof drains
Monthly and prior to significant rains
3
Maintain ventilation equipment
Per manufacturer's recommendations
and service vendor
4
Maintain split a/c systems for equipment rooms
and security office
Per manufacturer's recommendations
and service vendor
5
Change filters on all ventilation equipment
Quarterly or per manufacturer's
recommendations
6
Clean clarifiers
Per vendor's recommendation
Landscaping
1
Maintain landscaping per the approved landscaping
Coordinate with landscape contractor
plans; maintain logs on Reclaimed Water irrigation
as required by Sanitation District, monitor
performance of landscape contractor for initial
warranty period and weekly visits under contract
thereafter.
2
Ensure exterior landscaping is not inhibiting proper
Coordinate with landscape contractors
drainage from the structure
Exhibit A
Exhibit A
Activity
Painting
1
All areas of the structure will be graffiti free and
Daily
graffiti repainted
2
Any flaking or peeling paint touched up
Monthly
3
Repaint stairwells, accent colors and any exterior
As needed
colors
4
Pavement markings (stall lines, stall wording)
As needed/typically every five years
repainted
5
Red Curb repainting
Annually
Miscellaneous Repairs
1
Broken glass
Within 24 hours or at least covered
with plywood pending glass order
2
Repair or replace damaged or non-functioning door
Within 24 hours pending delivery of
hardware
replacement hardware
3
Check all concrete flat surfaces for any voids or
As needed; have original contractor
spalling (trip hazards)
repair under warranty period; after,
repair with appropriate vendor and
solution to the issue
4
Inspect all curb lines, entry/exit drives and
As needed; have original contractor
walkways for damaged concrete
repair under warranty period; after,
repair with appropriate vendor and
solution to the issue
Structural Inspections
1
Thoroughly inspect interior and exterior of
Annually; prepare written report with
structure in its entirety —expansion joints, decks,
photos of issues and action taken
beams, interior and exterior signage, elevator
structures (since they are free floating); ADA
entrances, ramps,
Exhibit A
Exhibit B
Residential Spaces
[map or other identification of Residential Spaces to be attached]
Exhibit A