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051303 CC Agenda
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the office of the City Clerk (909) 694-6444. Notification 48 hours prior to a meeting will enable the City to make reasonable arrangements to ensure accessibility to that meeting [28 CFR 35.102.35.104 ADA Title II] AGENDA TEMECULA CITY COUNCIL A REGULAR MEETING CITY COUNCIL CHAMBERS 43200 BUSINESS PARK DRIVE MAY 13, 2003 -7:00 P.M. At approximately 9:45 P.M., the City Council will determine which of the remaining agenda items can be considered and acted upon prior to 10:00 P.M. and may continue all other items on which additional time is required until a future meeting. All meetings are scheduled to end at 10:00 P.M. 6:00 P.M. - Closed Session of the City Council and Redevelopment Agency pursuant to Government Code Sections: Conference with real property negotiator pursuant to Government Code Section 54956.8 concerning the leasing of real property located at 28690 Mercedes (APN 922-042-004 and 005). The negotiating parties are the City of Temecula/Redevelopment Agency of the City of Temecula and Musician's Workshop. Under negotiation are the price and terms of payment of the real property interests proposed to be conveyed and/or acquired. The City/Agency Negotiators are Shawn Nelson; James O'Grady and John Meyer. 2. Conference with real property negotiator pursuant to Government Code Section 54956.8, regarding the following real properties: Real property owned by M & J Ramsay Corporation and identified as Assessor's Parcel numbers 910-310-013, 910-310-011, and 910-310-010. Negotiating parties: Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotitate with property owner, M & J Ramsay Corporation. Real property owned by KIR Temecula, L.P., and identified as Assessor's Parcel Number 910-300-013. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with property owner, KIR Temecula, L.P. Real property owned by EHG Associates and identified as Assessor's Parcel Number 910-281-003. Negotia;.ing parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owner, EHG Associates. R:~Agenda\051303 1 Real property owned by Taco Bell Corporation and identified as Assessor's Parcel Number 910-283-001. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owner, Taco Bell Corporation. Real property owned by Byron P. Sansom and Patricia W. Sansom and identified as Assessor's Parcel Number 910-284-001. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, Byron P. Sansom and Patricia W. Sansom. Real property owned by Kelly J. O'Neil and Debra O'Neil and identified as Assessor's Parcel Number 910-284-002. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, Kelly J. O'Neil and Debra O'Neil. Real property owned by Anthony D. Young and Deniece M. Young and identified as Assessor's Parcel Number 910-284-003. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, Anthony D. Young and Deniece M. Young. Real property owned by Gary M. Willard and Brenda K. Willard and identified as Assessor's Parcel Number 910-284-004. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, Gary M. Willard and Brenda K. Willard. Real property owned by James Frank D'Angelo, Trustee, James Frank D'Angelo Family Trust, and Jubela Family Limited Partnership, and identified as Assessor's Parcel Number 910-283-005. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, James Frank D'Angelo, Trustee, James Frank D'Angelo Family Trust, and Jubela Family Limited Partnership. Real property owned by Ellis Faeber Medical Building, LLC and identified as Assessor's Parcel Number 910-264-006. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiation parties may negotiate with the property owner, Ellis Faeber Medical Building, LLC. R:~Agenda\051303 2 Real property owned by Thomas D. Loboue and Laura B. Loboue and identified as Assessor's Parcel Number 910-284-007. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, Thomas D. Loboue and Laura B. Loboue. Real property owned by David C. Robinson and Yoland F. Robinson and identified as Assessor's Parcel Number 910-284-008. Negotiating parties, Bill Hughes, Director of Public Works, Jim O'Grady, Assistant City Manager, and Shawn Nelson, City Manager, regarding instructions to negotiators concerning price. Negotiating parties may negotiate with the property owners, David C. Robinson and Yoland F. Robinson. Conference with City Attorney and legal counsel pursuant to Government Code Section 54956.8 regarding the acquisition of real property located adjacent to City Hall on Business Park Drive (APN 921-020-079) Under negotiation is the price and terms of the real property interests. The negotiating parties are the City of Temecula/Redevelopment Agency and the Riverside County Sheriff's Department. The City negotiators are Shawn Nelson, Jim O'Grady, and John Meyer. Conference with City Attorney and legal counsel pursuant to Government Code Section 54956.9(b)(1) with respect to one matter of potential litigation. With respect to such matter, the City Attorney has determined that a point has been reached where there is a significant exposure to litigation involving the City based on existing facts and circumstances and the City will decide whether to initiate litigation. Public Information concerning existing litigation between the City and various parties may be acquired by reviewing the public documents held by the City Clerk. CALL TO ORDER: Prelude Music: Invocation: Flag Salute: ROLL CALL: Mayor Jeff Stone Amanda Madrid Bishop Frazier of Rock of Faith Mayor Pro Tern Naggar Comerchero, Naggar, Pratt, Roberts, Stone PRESENTATIONS/PROCLAMATIONS Arts in the Country Proclamation Relay for Life Proclamation Balloon and Wine Festival Proclamation Next in Order: Ordinance: No. 2003-04 Resolution: No. 2003-39 R:~Agenda\051303 3 PUBLIC COMMENTS A total of 30 minutes is provided so members of the public may address the Council on items that appear within the Consent Calendar or ones that are not listed on the agenda. Speakers are limited to two (2) minutes each. If you desire to speak to the Council on an item which is listed on the Consent Calendar or a matter not listed on the agenda, a pink "Request to Speak" form should be filled out and filed with the City Clerk. When you are called to speak, please come forward and state your name for the record. For all Public Hearing or Council Business matters on the agenda, a "Request to Speak" form must be filed with the City Clerk prior to the Council addressing that item. There is a five (5) minute time limit for individual speakers. CITY COUNCIL REPORTS Reports by the members of the City Council on matters not on the agenda will be made at this time. A total, not to exceed, ten (10) minutes will be devoted to these reports. CONSENT CALENDAR NOTICE TO THE PUBLIC All matters listed under Consent Calendar are considered to be routine and all will be enacted by one roll call vote. There will be no discussion of these items unless Members of the City Council request specific items be removed from the Consent Calendar for separate action. 1 Standard Ordinance and Resolution Adoption Procedure RECOMMENDATION: 1.1 Mot[on to waive the reading of the text of all ordinances and resolutions included in the agenda. 2 Approval of Minutes RECOMMENDATION: 2.1 Approve the minutes of April 8, 2003. 3 Resolution Approvin.q List of Demands RECOMMENDATION: 3.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ALLOWING CERTAIN CLAIMS AND DEMANDS AS SET FORTH IN EXHIBIT A R:~Agenda\051303 4 4 City Treasurer's Report RECOMMENDATION: 4.1 Receive and file the City Treasurer's Report as of March 31, 2003. 5 6 Approval of the Pacific Profiles Aqreement RECOMMENDATION: 5.1 Approve the agreement for consultant services with Pacific Profiles to conduct Dynamics in Leadership Training Academies for the mid-management staff. Meadows Village Development Plan (PA02-0273) - Conditional Use Permit (PA02-0274) RECOMMENDATION: 6.1 Adopt a resolution entitled: RESOLUTION NO. 03-.__ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA DENYING PLANNING APPLICATION NO. PA02- 0273, A DEVELOPMENT PLAN FOR THE DESIGN, CONSTRUCTION, AND OPERATION OF A 48,372 SQUARE FOOT GROCERY STORE, A 13,217 SQUARE FOOT DRUG STORE, A 11,571 SQUARE FOOT RETAIL BUILDING, A 10,568 SQUARE FOOT SHOP BUILDING, AND A 9,603 SQUARE FOOT RETAIL BUILDING, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954- 030-001 6.2 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA DENYING PLANNING APPLICATION NO. PA02- 0274, A CONDITIONAL USE PERMIT TO OPERATE A DRIVE THROUGH AT A 13,217 SQUARE FOOT DRUG STORE, AND TO PERMIT THE SALE OF ALCOHOL AT A 48,427 SQUARE FOOT GROCERY STORE AND AT A 13,217 SQUARE FOOT DRUG STORE, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954-030-001 7 Community Grant Aqreement with the Temecula Sister City Association RECOMMENDATION; 7.1 Approve a grant in the amount of $10,000.00 for the Temecula Sister City Association for fiscal year 2002-2003. R:~Agenda\051303 5 8 9 10 11 Purchase and Sale Aqreement for the Roripaugh Ranch Open Space RECOMMENDATION: 8.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THAT CERTAIN AGREEMENT ENTITLED PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS AND AUTHORIZE THE CITY MANAGER TO RECORD A DEED RESTRICTION AS REQUIRED BY ASSESSMENT DISTRICT (AD) 161 MULTIPLE SPECIES SUB-AREA HABITAT CONSERVATION PLAN FOR CERTAIN REAL PROPERTY DESCRIBED AS THE 201-ACRE RORIPAUGH RANCH OPEN SPACE PROPERTY IN THE CITY OF TEMECULA Award of contract to update the Citywide Desiqn Guidelines RECOMMENDATION: 9.1 Award a contract to RRM Design Group in the amount of $70,245.00 to update the Design Guidelines. Tract Map No. 29353-1 (located south of Murrieta Hot Sprinqs Road and west of the Metropolitan Water District Fee Riqht of Way within the Plateau Area of the Roripauqh Ranch Specific Plan RECOMMENDATION: 10.1 Approve Tract Map No. 29353-1 in conformance with the conditions of approval; 10.2 Approvethe Subdivision Improvement Agreement; 10.3 Approve the Subdivision Monument Agreement and accept the Faithful Performance Bond, Labor and Material Bond, and Monument Bond as security for the agreements. Acceptance of an Easement for Public Utility and Drainaqe Purposes toqether with the riqht of inqress and egress for Emergency vehicles within Tract Map No. 23371-1 (located north of Rancho California Road, east of Marqarita Road, west of Meadows Parkway, south of La Serena Way, and within the Margarita Villaqe Specific Plan No. 199 - Temeku Hills Subdivision RECOMMENDATION: 11.1 Adopt a resolution entitled: R:~genda\051303 6 12 13 RESOLUTION NO. 03-__ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES LOCATED WITHIN TRACT MAP NO. 23371-1 Acceptance of an Easement for Public Utility and Drainaqe Purposes to.qether with the ri.qht of inqress and e.qress for Emerqency vehicles and other easements for Public Utility and Draina.qe Purposes within Tract Map No. 23371-2 (located north of Rancho California Road, east of Marqarita Road, west of Meadows Parkway, south of La Serena Way, and within the Marqarita Villaqe Specific Plan No. 199 - Temeku Hills Subdivision RECOMMENDATION: 12.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENTS FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-2 Acceptance of an Easement for Public Utility and Drainaqe Purposes toqether with the ri.qht of ingress and e.qress for Emer.qency vehicles and other Easement for Public Utility and Drainage Purposes within Tract Map No. 23371-5 (located north of Rancho California Road, east of Marqarita Road1 west of Meadows Parkway, south of La Serena Way, and within the Marqarita Village Specific Plan No. 199- Temeku Hills Subdivision RECOMMENDATION: 13.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENTS FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-5 R:~Agenda\051303 7 14 Subdivision Improvement Aqreement and Bonds for Tract Map No. 29639 Harveston Offsite Improvements - Winchester Road Widenin.q at I-15 Southbound Off-ramp affectinq Jefferson Avenue RECOMMENDATION: 14.1 Accept the Subdivision Improvement Agreement for the offsite improvements required of the Narveston Project developer - Lennar Communities; 14.2 Accept the Subdivision Faithful Performance and Labor and Materials Bond as security for the improvements and as a source for claims against labor and materials, respectively; 14.3 Direct the City Clerk to so advise the developer and surety. 15 Acceptance of certain Public Streets into the City-Maintained Street System within Parcel 16 Map No. 26488 (located north of La Serena Way, east of Calle Medusa, south of Nicolas Road, and west of Buttedield StaRe Road) RECOMMENDATION: 15.1 Adopt a resolution entitled: RESOLUTION NO, 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN PARCEL NO. 26488) Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 21821 (located north of Via Norte, east of Winchester Road, south of Nicolas Road1 and west of Butterfield Staqe Road within the Meadowview Area) RECOMMENDATION: 16.1 Adopt a resolution entitled: RESOLUTION NO, 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 21821) R:~genda\051303 8 17 Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 23143-2 (located north of De Portola Road, east of Butterfield Staqe Road, south of Pauba Road, and west of City limits) RECOMMENDATION: 17.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 23143-2) 18 Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 23143-4 (located north of De Portola Road, east of Buttedield Staqe Road, south 19 of Pauba Road, and west of City limits) RECOMMENDATION: 18.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN PARCEL NO. 23143-4) Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 24182-2 (located north of Hi.qhway 79 North, east of Meadows Parkway, south of De Portola Road, and west of Buttedield Staqe Road) RECOMMENDATION: 19.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT MAP NO. 24182-2) R:\Agenda\051303 9 2O Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 28503 (located north of La Serena Way, east of Margarita Road, south of Nicolas Road, and west of Butterfield Staqe Road) RECOMMENDATION: 20.1 Adopt a resolution entitled: RESOLUTION NO. 03-.__ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT MAP NO. 28503) 21 22 23 Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 28850 (located north of Rancho California Road, east of Ynez Road, south of Margarita Road, and west of Meadows Parkway) RECOMMENDATION: 21.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT MAP NO. 28850) Amendment No. 1 of the Annual Aqreement for Professional Real Estate Appraisal Services with Mason & Mason Real Estate Appraisers RECOMMENDATION: 22.1 Approve Amendment No. 1 to the Annual Agreement for Professional Real Estate Appraisal Services between the City and Mason & Mason Real Estate Appraisers, dated July 23, 2002, by increasing the cumulative annual amount by $15,450. Award of Construction Contract for the Slurry Seal Proiect - FY2002/2003 - Proiect No. PW03-02 RECOMMENDATION: 23.1 Award a construction contract for the Slurry Seal Project - FY2002/2003 to Sudhakar Company International, Inc. in the amount of $276,108.55 and authorize the Mayor to execute the contract; 23.2 Authorize the City Manager to approve change orders not to exceed the contingency amount of $27,610.86 which is equal to 10% of the contract amount. R:~Agenda\051303 10 24 25 Award of Construction Contract for the Citywide Concrete Repairs - FY2002/2003 - Proiect No. PW03-03 RECOMMENDATION: 24.1 Award a construction for the Citywide Concrete Repairs - FY2002/2003, Project No. PW03-03 to Malton Construction in the amount of $58,327.50 and authorize the Mayor to execute the contract; 24.2 Authorize the City Manager to approve change orders not to exceed the contingency amount of 5,837.50 which is equal to 10% of the contract amount. Professional Services Aqreement for Geotechnical and Material Testinq Services and Special Inspection - Kleinfelder, Inc. - Rancho California Road Bridqe Wideninq over Murrieta Creek- Proiect No. PW99-18 RECOMMENDATION: 25.1 Approve an agreement with Kieinfelder, Inc. in an amount not to exceed $80,328.00 to provide as needed geotechnical, material testing services, and special inspection for the Rancho California Road Bridge Widening over Murrieta Creek Improvements - Project No. PW99-18 - and authorize the Mayor to execute the agreement; 25.2 Authorize the City Manager to approve amendments to the agreement not to exceed the contingency amount of $8,032.80 which is equal to 10% of the agreement amount. 26 27 Professional Services A,qreement with TY Lin International for Construction Support for the Rancho California Road Bridqe Wideninq over Murrieta Creek - Proiect No. Pwgg-18 RECOMMENDATION: 26.1 Approve a Professional Services Agreement with TY Lin International in an amount not to exceed $40,385.00 for construction support for the Rancho California Road Bridge Widening over Murrieta Creek - Project No. PW99-18 - and authorize the Mayor to execute the contract; 26.2 Authorize the City Manager to approve change orders not to exceed the contingency amount of $4,038.50 which is equal to 10% of the agreement amount. Solicitation of Construction Bids for Pechanqa Parkway - Phase IIA - Storm Drain Improvements - Project No. PW99-11 SD RECOMMENDATION: 27.1 Approve the project plans and specifications and authorize the Department of Public Works to solicit bids for the construction of the Pechanga Parkway - Phase IIA - Storm Drain Improvements- Project No. PW99-11SD. R:~,genda\051303 11 28 Approval of Plans and Specifications and Authorization to solicit Construction Bids for the Pavement Rehabilitation Proqram 2002-2003 Rancho California Road - Project No. PW02-13. RECOMMENDATION: 28.1 Approve the Construction Plans and Specifications and authorize the Department of Public Works to solicit construction bids for the Pavement Rehabilitation Program 2002-03 Rancho California Road - Project No. PW02-13. 29 Rancho California Road Wideninq and Median Modifications East of Ynez Road - Project No, PW00-20 - Environmental Assessment and authorization to solicit Bids RECOMMENDATION: 29.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING A NEGATIVE DECLARATION FOR THE RANCHO CALIFORNIA ROAD WIDENING AND MEDIAN MODIFICATIONS EAST OF YNEZ ROAD PROJECT PW00-20 29.2 Approve the Project Plans and Specifications and authorize the Department of Public Works to solicit bids for the Rancho California Road Widening and Median Modifications east of Ynez Road - Project No. PW00-20 29.3 Approve the Project Plans and Specifications and authorize the Department of Public Works to solicit bids for the Rancho California Road Widening and Median Modifications East of Ynez Road, Project No. PW00-20. RECESS CITY COUNCIL MEETING TO SCHEDULED MEETINGS OF THE TEMECULA COMMUNITY SERVICES DISTRICT, THE CITY OF TEMECULA REDEVELOPMENT AGENCY, AND TEMECULA PUBLIC FINANCING AUTHORITY R:~Agenda\051303 12 TEMECULA COMMUNITY SERVICES DISTRICT MEETING CALLTO ORDER: President Jeff Comerchero ROLL CALL: DIRECTORS: PUBLIC COMMENTS Next in Order: Ordinance: No. CSD 2003-01 Resolution: No. CSD 2003-08 Naggar, Pratt, Roberts, Stone, Comerchero A total of 15 minutes is provided so members of the public may address the Board of Directors on items that are not listed on the agenda or on the Consent Calendar. Speakers are limited to two (2) minutes each. If you decide to speak to the Board of Directors on an item no~t on the agenda or on the Consent Calendar, a pink "Request to Speak" form should be filled out and filed with the City Clerk. When you are called to speak, please come forward and state your name for the record. For all other agenda items, a "Request to Speak" form must be filed with the City Clerk Prior to the Board of Directors addressing that item. There is a five (5} minute time limit for individual speakers. Anyone wishing to address the Board of Directors should present a completed pink "Request to Speak" form to the City Clerk. When you are called to speak, please come forward and state your name and address for the record. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 22, 2003. 2 Subcommittee for Veteran's War Memorial RECOMMENDATION: 2.1 Appoint Mayor Stone and Temecula Community Services District President Comerchero to serve on a subcommittee for the development of a Veteran's War Memorial. DIRECTOR OF COMMUNITY SERVICES REPORT GENERAL MANAGER'S REPORT BOARD OF DIRECTORS'REPORTS R:V~genda\051303 13 ADJOURNMENT Next regular meeting: Tuesday, May 27, 2003, 7:00 PM, City Council Chambers, 43200 Business Park Drive, Temecula, California. R:~Agenda\051303 14 TEMECULA REDEVELOPMENT AGENCY MEETING CALL TO ORDER: Chairperson Ron Roberts ROLL CALL AGENCY MEMBERS: PUBLIC COMMENTS Next in Order: Ordinance: No. RDA 2003-01 Resolution: No. RDA 2003-08 Comerchero, Naggar, Pratt, Stone, Roberts A total of 15 minutes is provided so members of the public may address the Redevelopment Agency on items that are not listed on the agenda or on the Consent Calendar. Speakers are limited to two (2) minutes each. If you decide to speak to the Board of Directors on an item not on the agenda or on the Consent Calendar, a pink "Request to Speak" form should be filled out and filed with the City Clerk. When you are called to speak, please come forward and state your name for the record. For all other agenda items, a "Request to Speak" form must be filed with the City Clerk Prior to the Board of Directors addressing that item. There is a five (5) minute time limit for individual speakers. Anyone wishing to address the Board of Directors should present a completed pink "Request to Speak" form to the City Clerk. When you are called to speak, please come forward and state your name and address for the record. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 22, 2003. EXECUTIVE DIRECTOR'S REPORT AGENCY MEMBERS' REPORTS ADJOURNMENT Next regular meeting: Tuesday, May 27, 2003, City Council Chambers, 43200 Business Park Drive, Temecula, California. R:~Agenda\051303 15 Next in Order: Ordinance: No. TPFA 2003-02 Resolution: No. TPFA 2003-09 CALL TO ORDER: Chairperson Jeff Stone ROLL CALL AGENCY MEMBERS: Comerchero, Naggar, Pratt, Roberts, Stone PUBLIC COMMENTS A total of 15 minutes is provided so members of the public may address the Temecula Public Financing Authority on items that are not listed on the agenda or on the Consent Calendar. Speakers are limited to two (2) minutes each. If you decide to speak to the Board of Directors on an item not on the agenda or on the Consent Calendar, a pink "Request to Speak" form should be filled out and filed with the City Clerk. When you are called to speak, please come forward and state your name for the record. For all other agenda items, a "Request to Speak" form must be filed with the City Clerk Prior to the Board of Directors addressing that item. There is a five (5) minute time limit for individual speakers. Anyone wishing to address the Board of Directors should present a completed pink "Request to Speak" form to the City Clerk. When you are called to speak, please come forward and state your name and address for the record. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 22, 2003. Ratifyinq Election and Approval of Issuance of Bonds for Temecula Public Financinq Authority Community Facilities District No. 03-1 (Crowne Hill) RECOMMENDATION: 2.1 Adopt a resolution entitled: RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY CALLING SPECIAL RATIFYING ELECTION WITHIN COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) R:~Agenda\051303 16 2.2 Hold an election ratifying the formation of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "CFD"), the levy of special taxes in the CFD, the incurrence of indebtedness of the CFD and an appropriations limit for the CFD, and then adopt the resolutions entitled: RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY DECLARING RESULTS OF SPECIAL RATIFYING ELECTION AND DIRECTING RECORDING OF NOTICE OF SPECIAL TAX LIEN RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS OF THE TEMECULA PUBLIC FINANCING AUTHORITY FOR TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL), APPROVING AND DIRECTING THE EXECUTION OF A FISCAL AGENT AGREEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS PUBLIC HEARING Any person may submit written comments to the Temecula Public Financing Authority before a public hearing or may appear and may be heard in support of or in opposition to the approval of the project(s) at the time of the hearing. If you challenge any of the project(s) in court, you may be limited to raising only those issues you or someone else raised at the public hearing or in written correspondence delivered to the City Clerk at, or prior to, the public hearing. 3 Formation of Community Facilities District No. 01-3 (Wolf Creek) and Amendment of Resolution of Intention for form the District RECOMMENDATION: 3.1 Adopt a resolution entitled: RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY MAKING FINDINGS OF COMPLEXITY OF PROPOSED COMMUNITY FACILITIES DISTRICT NO. 01-3 (WOLF CREEK) AND AMENDING RESOLUTION OF INTENTION TO FORM THE DISTRICT EXECUTIVE DIRECTOR'S REPORT BOARD MEMBERS' REPORTS ADJOURNMENT R:~Agenda\051303 17 RECONVENE TEMECULA CITY COUNCIL PUBLIC HEARING Any person may submit written comments to the City Council before a public Hearing or may appear and be heard in support of or in opposition to the Approval of the project(s) at the time of the hearing. If you challenge any of the project(s) in court, you may be limited to raising only those issues you or someone else raised at the public hearing or in written correspondence delivered to the City Clerk at, or prior to, the public hearing. 30 Planninq Application No. 02-0567 - Ed.qe Niqhtclub Appeal (continued from March 25 and April 22, 2003) RECOMMENDATION: 30.1 Continue to the May 27, 2003 City Council meeting. 31 Development Code Amendment (Planninq Application No. 03-0109 RECOMMENDATION: 31.1 Introduce and read by title only an ordinance entitled: ORDINANCE NO. 03- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES, AND PROVIDE FOR THE READOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6 (PLANNING APPLICATION 03-0109) 32 Issuance of Bonds by the California Statewide Communities Development Authoritv for the Temecula Heritaqe Park Senior Livinq Senior Housin,q Project RECOMMENDATION: 32.1 Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THE ISSUANCE OF MULTIFAMILY HOUSING REVENUE BONDS BY THE CALIFORNIA STATEWlDE COMMUNITIES DEVELOPMENT AUTHORITY R:~,genda\051303 18 COUNCIL BUSINESS 33 Redhawk Annexation A.qreement RECOMMENDATION: 33.1 Approve in substantial form the Redhawk Annexation Agreement No. 1 between the County of Riverside and the City of Temecula. 34 Citrus Vineyard Policy Area Proposed Up Zoninq (Callaway) (at the request of Mayor Stone) RECOMMENDATION: 34.1 Provide direction to staff for further action. CITY MANAGER'S REPORT CITY A'I-FORNEY'S REPORT ADJOURNMENT CIP/Budget Workshop: City Council, Thursday, May 15, 2003, at 5:30 P.M., City Council Chambers, 43200 Business Park Drive, Temecula, California. Next regular meeting: City Council, Tuesday, May 27, 2003, at 7:00 P.M., City Council Chambers, 43200 Business Park Drive, Temecula, California. R:~Agenda\051303 19 PROCLAMATIONS AND PRESENTATIONS ITEM 1 ITEM 2 MINUTES OF A REGULAR MEETING OF THE TEMECULA CITY COUNCIL APRIL 8, 2003 After the Closed Session that convened at 6:00 P.M., the City Council convened in Open Session at 7:00 P.M., on Tuesday, March 25, 2003, in the City Council Chambers of Temecula City Hall, 43200 Business Park Drive, Temecula, California. Present: Absent: PRELUDE MUSIC Councilmembers: Comerchero, Naggar, Roberts, Stone Councilmember: Pratt The prelude music was provided by Margaret Bird. INVOCATION The invocation was given by Father Sean Cox of St. Thomas Episcopal Church. ALLEGIANCE The flag ceremony was presented by Cub Scout Pack No. 148. PRESENTATION/PROCLAMATIONS National Crime Victims' Rights Week Proclamation Accepting the proclamation from Mayor Pro Tem Naggar, Ms. Cammie Dudek, Victims' Witness Advocate from the District Attorney's Office, relayed appreciation to the City Council. Boys and Girls Club Proclamation Mayor Pro Tern Naggar presented the proclamation to Ms. Michelle Arrellano, President of the Boys and Girls Club, and Mr. Chuck Washington, Board of Director. Certificate of Achievement to M. Christopher Kensin,qer for attaining Eagle Scout rank Describing his Eagle Scout project, Christopher Kensinger, with appreciation, accepted the Certificate of Achievement given to him by Mayor Pro Tem Naggar. Certificate of Achievement to Christopher E. Ritzer for attaining Eagle Scout rank Accepting the Certificate of Achievement from Mayor Pro Tem Naggar, Christopher Ritzer provided a brief overview of his Eagle Scout project. R:~Vlinutes\040803 1 PUBLIC COMMENTS A. Relaying his concern with regard to traffic congestion on Mercedes Street, Mr. Otto Baron, 28681 Pujol Street, suggested moving the centerline. City Manager Nelson recommended that Mr. Baron contact the Public Works Director. B. Mr. Paul Runkle, 43460 Ridge Park Drive, addressed the potential Redhawk annexation, noting that a cimulated petition reflected a 95% support of the proposed annexation. CITY COUNCIL REPORTS A. Having met with American Medical Response (AMR) representatives as well as Fire Department personnel to discuss the use of opticom (Traffic Control System) units on all ambulances, Councilman Roberts advised that AMR has committed to expediently equip the City-based ambulance units with this new technology. As a member of the SR 91 Advisory Committee, Councilman Roberts provided an update on efforts being undertaken to ensure the effectiveness of the 91 Freeway, commenting on toll rates as well as the opening, during specified times, of the westbound and eastbound three-plus traffic lanes. Mr. Roberts advised that the California Transportation Commission approved funding for the construction of another free traffic lane on the 91 Freeway, noting this project should be completed within two years. In closing, Councilman Roberts advised that he had been elected as the Second Vice President of the Southern California Association of Governments. B. Referencing the City's Web site with regard to Megan's Law and its associated pin maps, Mayor Pro Tern Naggar advised of recent changes by the U.S. Supreme Court, allowing the posting of information on the internet and, thereby, giving the individual States the opportunity to do the same. It was noted that Mayor Stone and Mayor Pro Tem Naggar have requested to meet with the State Attorney General to discuss the possibility of similar changes to State Law. C. Commenting on the City Council's previous action to adopt a resolution supporting the Indian Gaming Local Community Benefits Act and distributing the Indian Gaming Special Distribution Fund, Councilman Comerchero advised that Western Riverside County Council of Governments (WRCOG) had adopted a similar resolution. By way of overheads, Councilman Comerchero informed the Council and the public of the newly instituted RTA Express Routes which should be implemented by May 25, 2003, as follows: to the Metrolink station in the City of Corona; to San Diego County, to Menifee San Jacinto Community College Campus, Sun City, Perris, Metrolink station in Riverside; and to the City of Hemet. Mr. Comerchero noted that the bus route will be posted on the City's Web site. In an effort to express support and gratitude to the military families during these trying times, Councilman Comerchero suggested the organization of a military family event. D. Commending Councilman Comerchero on his efforts with regard to the additional bus routes, Mayor Pro Tern Naggar requested that the newly instituted bus routes be promoted in the City's newsletter, Web site, etc. R:\Minutes\040803 2 E. Commenting on the Riverside County Integrated Plan (RCIP), Mayor Stone referenced the City's full-page ad with regard to this issue and extended appreciation to the residents who supported the City's position and forwarded communication to the Board of Supervisors. Supporting Councilman Comerchero's recommendation for the Military Family Event, Mayor Stone suggested the construction of a War Memorial at Veteran's Park, requesting that the Community Services Commission review the matter. In closing, Mr. Stone advised that issues involving the potential Redhawk annexation will be discussed at the May 13, 2003, City Council meeting. CONSENT CALENDAR 1 Standard Ordinance and Resolution Adoption Procedure RECOMMENDATION: 1.1 Motion to waive the reading of the text of all ordinances and resolutions included in the agenda. 2 Resolution Approvinq List of Demands RECOMMENDATION: 2.1 Adopt a resolution entitled: RESOLUTION NO. 03-36 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ALLOWING CERTAIN CLAIMS AND DEMANDS AS SET FORTH IN EXHIBIT A 3 City Treasurer's Report RECOMMENDATION: 3.1 Receive and file the City Treasurer's report as of February 28, 2003. 4 Award of Contract for Accela Wireless/Remote Access Serves and Software RECOMMENDATION: 4.1 Award a contract in the amount of $35,721.55 to Accela, Inc. for the purchase and installation of the Wireless/Remote Access Server and application to automate field inspections; 4.2 Approve an operating transfer from the General Fund Fire Department budget in the amount of $20,000. R:'~'vlinutes\040803 3 5 Tract Map No. 29133 (located east of Ynez Road and north of Santia,qo Road) RECOMMENDATION: 5.1 Approve Tract Map No. 29133 in conformance with conditions of approval. 6 Solicitation of Construction Bids and Approval of the Plans and Specifications for Project No. PW03-03 - Citywide Concrete Repairs - FY2002-03 RECOMMENDATION: 6.1 Approve the Construction Plans and Specifications and authorize the Department of Public Works to solicit construction bids for Project No. PW03-03 - Citywide Concrete Repairs - FY2002~03. MOTION: Mayor Pro Tern Naggar moved to approve Consent Calendar Item Nos. 1-6. The motion was seconded by Councilman Roberts and voice vote reflected approval with the exception of Councilman Pratt who was absent. At 7:38 P M., the City Council convened as the Temecula Community Services District, the Temecula Redevelopment Agency, and the Temecula Public Financing Authority, the City Council meeting, after a short recess, resumed with regular business at 7:41 P.M PUBLIC HEARING 7 Meadows Vitlaqe General Plan Amendment (PA02-0272); Specific Plan Amendment (PA02- 0271); Development Plan (PA02-0273); Conditional Use Permit (PA02-0274) RECOMMENDATION: 7.1 Continue this public hearing to the meeting of April 22, 2003. Mayor Stone opened the public hearing. MOTION: Councilman Comerchero moved to continue this public hearing to the meeting of April 22, 2003. The motion was seconded by Councilman Roberts and voice vote reflected approval with the exception of Councilman Pratt who was absent. CITY MANAGER'S REPORT No additional comment. CITY ATTORNEY'S REPORT With regard to Closed Session, City Attorney Thorson noted that there were no reportable actions. R:\Minutes\040803 4 ADJOURNMENT At 7:42 P.M., the City Council meeting was formally adjourned to Tuesday, April 22, 2003, at 7:00 P.M., in the City Council Chambers, 43200 Business Park Drive, Temecula, California. ATTEST: Jeffrey E. Stone, Mayor Susan W. Jones, CMC City Clerk [SEAL] R:\Minutes\040803 5 ITEM 3 RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ALLOWING CERTAIN CLAIMS AND DEMANDS AS SET FORTH IN EXHIBIT A THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. That the following claims and demands as set forth in Exhibit A, on file in the Office of the City Clerk, have been audited by the City Manager, and that the same are hereby allowed in the amount of $3,640,231.07. Section 2. The City Clerk shall certify the adoption of this resolution. PASSED, APPROVED AND ADOPTED, this 13th day of May, 2003. ATTEST: Jeffrey E. Stone, Mayor Susan W. Jones, CMC City Clerk [SEAL] R:/Resos2003/Resos 03- 1 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, hereby do certify that the foregoing Resolution No. 03- was duly adopted at a regular meeting of the City Council of the City of Temecula on the 13th day of May, 2003 by the following roll call vote: AYES: NOES: ABSENT: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC City Clerk R:/Resos2OO3/Resos 03- 2 CITY OF TEMECULA LIST OF DEMANDS 04/17/03 TOTAL CHECK RUN: 04/24/03 TOTAL CHECK RUN: 05/01/03 TOTAL CHECK RUN: 04/10/03 TOTAL PAYROLL RUN: TOTAL LIST OF DEMANDS FOR 05/13/03 COUNCIL MEETING: DISBURSEMENTS BY FUND: CHECKS: 001 165 190 192 193 194 210 261 28O 3OO 320 330 340 471 GENERAL FUND RDA-LOW/MOD INCOME HOUSING COMMUNITY SERVICES DISTRICT TCSD SERVICE LEVEL B TCSD SERVICE LEVEL C TCSD SERVICE LEVEL D CAPITAL iMPROVEMENT PROJ. FUND CFD 88-12 ADMIN EXPENSE FUND RDA-REDEVELOPMENT INSURANCE INFORMATION SYSTEMS SUPPORT SERVICES FACILITIES CFD 98-1 ADMIN EXPENSE FUND 001 165 19O 192 193 194 280 300 320 330 340 GENERAL FUND RDA-LOW/MOD INCOME HOUSING COMMUNITY SERVICES DISTRICT TCSD SERVICE LEVEL B TCSD SERVICE LEVEL C TCSD SERVICE LEVEL D RDA-REDEVELOPMENT INSURANCE INFORMATION SYSTEMS SUPPORT SERVICES FACILITIES TOTAL BY FUND: PREPARED BY RETA WESTON, ACCOUNTING SPECIALIST SHAWN NELSON, CITY MANAGER 1,355,828.09 195,711.38 1,784,709.89 303,981.71 $ 3,640,231.07 1,638,305.43 446,024.62 173,309.81 39,545.65 69,101.00 366.00 317,653.02 441.24 574,359.90 3,609.47 27,903.09 18,547.90 24,582.23 2,500.00 3,336,249.36 217,043.10 4,671.50 51,959.98 109.75 4,994.50 760.20 1,985.39 1,086.57 13,669.11 1,932.31 5,769.30 303,981.71 $ 3,640,231.07 , HEREBY CERTIFY THAT THE FOLLOWING IS TRUE AND CORRECT. HEREBY CERTIFY THAT THE FOLLOWING IS TRUE AND CORRECT. apChkLst 04/17/2003 8:22:18AM Final CheckList CITY OFTEMECULA Page: I Chock# Date 110 04/10/2003 83566 04/17/2003 83567 04/1712003 83568 04/17/2003 83569 04/17/2003 83570 04/17/2003 83571 04/17/2003 83572 04/17/2003 Bank: union UNION BANK OF CALIFORNIA Vendor Description 604952 AFFIRMED HOUSING PARTNER RDA & Affirmed Housing devel agrmnt 83573 04/17/2003 005277 2 H CONSTRUCTION INC 004148 AT&T 004973 ABACHERLI, LINDI 001916 ALBERT A WEBB ASSOCIATES 003859 ALL ABOUT SELF STORAGE Mar Prgs:Memantile BIdg Seismic Long distance svcs: City Hall TCSD instructor earnings Consulting Srvcs:CFD 01-2 Harveston Storage Unit for Children's Museum 004240 AMERICAN FORENSIC NURSES DUI:Drug/Alcohol Screening svc:Poli DUkDrug/AIcohol Screening svc:Poli 000101 APPLE ONE, INC. Tamp help PPE 03/29/03 Delarm Tamp help PPE 03/29/03 Kissam Tamp help PPE 03/22/03 Atkinson Temp help PPE 03/29/03 Atkinson Tamp help PPE 03/29/03 Kau 002648 AUTO CLUB OF SOUTHERN CA Membership: Phil Smith 88550959 Membership: Matt Wiechec 88552195 Membership: Kevin Harrington 88552 Membership: Donna Vedra 88552047 Membership: Marianne Parker 88551 Amount Paid Check Total 000622 BANTA ELECTRIC-REFRIGERA 002541 BECKER CONSTRUCTION SRV 004856 BILLIARDS DEPOT 005142 BUCKLEY, TIMOTHY 000128 CAL SURANCE ASSOCIATES I 412,489.00 412,489.00 82,292.31 82,292.31 38.02 38.02 577.60 577.60 2,500.00 2,500.00 2,868.00 2,868.00 83574 04/17/2003 83575 04/17/2003 83576 04/17/2003 83577 04/17/2003 83578 04/17/2003 83579 04/17/2003 006132 CALHOUN, MIYUKI Install fire alarm @ Children's Museu 252.00 72.00 324.00 624.00 594.75 442.00 344.50 312.00 2,317.25 44.00 44.00 44.66 44.60 44.00 220,00 875.00 875.00 Construct Handicap ramp:Vail Ranch 4 Pool table covers:CRC 3,500.00 3,500.00 226.10 226.10 Reimb:Low Angle Rescue Tm:4/5-6 Fire Rescue Truck Insurance 228.91 228.91 230.00 230.00 Refund:Exemise-Belly Dancing 30.00 30.00 Page:l apChkLst Final Check List Page: 2 04/17/2003 8:22:18AM CiTY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83580 04/17/2003 83581 04/17/2003 83582 04/17/2003 83583 04/17/2003 83584 04/17/2003 83585 04/17/2003 83586 04/17/2003 83587 04/17/2003 83588 04/17/2003 83589 04/17/2003 000131 CARL WARREN & COMPANY I 000137 CHEVRON U S A INC 006130 CLARK, BRIAN 005447 CLEMENTS, BRIAN 001193 COMP U S A INC 000447 COMTRONIX OF HEMET 006042 CREATIVE EVENT SOLUTIONS 008131 CUSICK, KERRY 003272 DAISY WHEEL RIBBON 001380 E S I EMPLOYMENT SERVICES 83590 04/17/2003 002283 EMBASSY SUITES HOTEL 83591 04/17/2003 005052 EMCOR SERVICE 83592 04/17/2003 83593 04/17/2003 83594 04/17/2003 003665 EMERITUS COMMUNICATIONS 005251 EQUIPMENT REPAIR SERVICE 002060 EUROPEAN DELI & CATERING (Continued) Description Amount Paid Claim adjuster services Fuel expense: Police vehicles Refund: Permit - Revised sq footage Reimb: IOBO Cert:new expr 3/4/06 Computer supplies:Info Sys Computer supplies:Info Sys Equip/Parts for police radio speaker EMS Conf:6/4-6/03:Bolowich/St rickler Refund: Sports - Kids Love Soccer Plotter paper and ink:GIS Temp help PPE 04/04/03 Heer Temp help PPE 04/04/03 Bragg Temp help PPE 04/04/03 Kanigowski Temp help PPE 04/04/03 Novotny Temp help PPE 04/04/03 Jones Temp help PPE 04/04/03 Seng Temp help PPE 04/04/03 Montecino Rooms for Every 15 min prgm H.V.A.C. repair @ City Hall H.V.A.C. repair @ CRC H.V.A.O. repair @ City Hall H.V.A.C. repair @ City Hall Mar long distance phone Light Tower Repair Svcs:PW mntc Light Tower Repair Svcs:PW mntc Refshmnts: Education Center mtg 1,571.86 242.03 31.12 60.00 95.31 105.26 940.20 65.00 383.52 2,598.44 1,710.72 1,286.99 1,178.76 1,174.32 1,109.60 1,285.68 1,331.38 737.11 325.00 97.50 289.98 572.41 164.65 73.27 Check Total 1,571.86 242.03 31.12 60.00 189.42 105.26 940.20 65.00 383.52 10,213.57 1,285.68 2,490.99 289.98 737.06 73.27 Page2 apChkLst Final Check List Page: 3 04/17/2003 8:22:18AM CITY OF TEMECULA Check # Bank: union UNION BANK OF CALIFORNIA Date Vendor 83595 04/17/2003 83596 04/17/2003 83597 04/17/2003 83598 04/17/2003 83599 04/17/2003 83600 04/17/2003 83601 04/17/2003 83602 04/17/2003 83603 04/17/2003 83604 04/17/2003 83605 04/17/2003 83606 04/17/2003 83607 04/17/2003 83608 04/17/2003 83609 04/17/2003 83610 04/17/2003 83611 04/17/2003 001056 EXCEL LANDSCAPE 002037 EXPANETS 000165 FEDERAL EXPRESSINC 000166 FIRST AMERICAN TITLE 001135 FIRST CARE INDUSTRIAL MED 002528 GLASS BLASTERS INC 005947 GOLDEN STATE OVERNIGHT 001609 GREATER ALARM COMPANY 005311 H20 CERTIFIED POOL WATER 004053 HABtTAT WEST INC 000186 HANKS HARDWARE INC 000186 HANKS HARDWARE INC 000871 HILTON 004833 IMPERIAL PAVING COMPANY 001186 IRWIN,JOHN (Continued) Description Mar Ldscp Maint Svcs:Var City Sites Maint Agrmnt for Telephone System Express mail services Express mail services CLTA Litigation: Winchester Widening CLTA Litigation: Winchester Widening CLTA Litigation: Winchester Widening CLTA Litigation: Winchester Widening CLTA Litigation: Community Theater CLTA Litigation: Community Theater Pre*employment physicals New employee glass mugs Express Mail Service Alarm Monitoring Svcs: Storefront CRC - Swimming Pool Maint Svcs Mntc svcs agrmnt: Pala Rd Refund: Eng Depst: PM 19582-1 Para Hardware supplies: Fire Dept Hardware supplies: Fire Dept Street Crimes cf:6/23-25:POP Staff R&R A.C. Pachanga Pkwy @ Masters Install AC Berm & bus pad Diaz Road TCSD instructor earnings 002140 JAGUAR COMPUTER SYSTEMS JCS Qtdy Billing: IS Internet router update 006125 JOHN E REID & ASSOCIATES Street Crimes conf:6/22-25:POP staff Amount Paid Check Total 96,478.00 96,478.00 2,498.50 2,498.50 241.84 99.69 341.53 500.00 500.00 500.00 500.00 500.00 500.00 3,000.00 365.00 365.00 66.81 66.81 72.44 72.44 81.00 81.00 1,200.00 1,200.00 700.00 700.00 995.00 995.00 598.19 389.26 987.45 695.52 695.52 23,741.00 14,860.00 38,601.00 76.00 76.00 300.00 190.00 490.00 2,070.00 2,070.00 Page3 apChkLst 04117/2003 8:22:18AM Final Check List CITY OF TEMECULA Page: 4 Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83612 04/17/2003 83613 04/17/2003 83614 04/17/2003 83615 04/17/2003 83616 04/17/2003 83617 04/17/2003 003280 JON LASKIN BAND 005974 JUDGE NEVI'lNG INC 005054 K M E FIRE APPARATUS (Continued) Description Entertainment:Dixieland Jazz Festival Install Ballfield Netting: RCS Prefabbed storage shelfs:Medic Amount Paid Check Total 250.00 250.00 84,444.00 84,444.00 431.00 431.00 006133 KARL LOWRY CONSTRUCTION Refund: Eng Depst: TR 3929 Lot 133 Refund: Eng Depst: TR 3883 Lot 321 006120 LAKE ELSINORE UNIFIED Entertainment:Dixieland Jazz Festival 005904 LASHER AUTO CENTER GEM vehicles for special events:3140 GEN vehicles for special events: 2319 83618 04/17/2003 001690 LAU~'ZENHISERS STATIONERY Permanent City Record Books 83619 04/17/2003 003286 LIBRARY SYSTEMS & SERVICE Mar svcs-library system agrmt 83620 04/t7/2003 004087 LOWE'S 83621 04/17/2003 000394 MAINTENANCE Misc hardware supplies:TCSD Misc hardware supplies:TCSD MSA mtg:BHIBBIRW/AAIAMIJA/DM 83622 04/17/2003 83623 04/17/2003 83624 04/17/2003 004141 MAINTEX INC O.T.6th St. custodial Supplies City Hall custodial supplies CRC custodial supplies 001967 MANPOWER TEMPORARY SER temp help w/e 3/23 Dankworth temp help w/e 3/30 Ceballes temp help w/e 3/30 Gaier 002664 MAR CO INDUSTRIES INC Custodial equip maint/repair svcs 83625 04/17/2003 83626 04/17/2003 83627 04/17/2003 000220 MAURICE PRINTERS INC 001905 MEYERS, DAVID WILLIAM 001892 MOBILE MODULAR Envelopes for Econ. Dev. Labels for Econ. Dev. Lette~ead stationery:Econ. Dev. TCSD instructor earnings TCSD instructor earnings Apr modular bldg rental:Fire Stn 92 83628 04/17/2003 000883 MONTELEONE EXCAVATING Clean-Out Channels/Desilting Ponds 995.00 995.00 1,990.00 100.00 100.00 4,227.00 3,006.00 7,233.00 876.70 876.70 11,253.95 11,253.95 57.11 43.01 100.12 140.00 140.00 1,034.84 177.96 174.73 1,387.53 1,007.89 540.00 224.48 1,772.37 18.69 18.69 801.66 711.15 649.73 2,162.54 672.00 352.00 1,024.00 777.95 777.95 33,500.00 33,500.00 Page~ apChkLst Final Check List Page: 5 04/1712003 8:22:18AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83829 04/17/2003 004128 MORAMARCO, ANTHONY J. 83630 04/17/2003 83631 04/17/2003 83632 04/17/2003 83633 04/17/2003 83634 04/17/2003 83635 04/17/2003 83636 04/17/2003 83637 04/17/2003 (Continued) Description TCSD instructor earnings 006077 N T H GENERATION COMPUTIN Trn:StorageWorks SAN solutions:l.S. 004508 NAGGAR, MICHAEL 002925 NAPA AUTO PARTS 000727 NATIONAL FIRE PROTECTION 004512 NINYO & MOORE 006128 NIQUET, PAULA 004401 NU VISION PRODUCTIONS 003964 OFFICE DEPOT BUSINESS SVS 83638 04/17/2003 002105 OLD TOWN TIRE & SERVICE 83639 04/17/2003 006134 OLDHAM, STEPHENJ. 83640 04/17/2003 003218 PELA 83641 04/17/2003 000249 PETTY CASH 83642 04/17/2003 000252 POLYCRAFT INC 83643 04/17/2003 000254 PRESS ENTERPRISE COMPAN Econ Dev Comm. Ch3/27-28/03 parts/supplies for PW equip parts/supplies for PW equip Credit: items returned Safety Conf:5/18-21 :Neuman Consultant svcs:Wolf Crk Sports Refund:Tiny Tots - Creative Beg. Depst:Taping/Editing:Every 15 Min Prg Laserjet Printer for PD add'l Laser Jet Printer for Police office supplies:Planning office supplies:P.D. SW Stn office supplies:P.D. SW Stn office supplies:P.D. SW Stn office supplies:Code Enf. office supplies:P.D. SW Stn office supplies:Finance office supplies:Code Enf. City vehicle maint/repair svcs Reimb:Trf Sgnl Inspector training:3/30 Mar Planning plan check svcs Mar TCSD plan check svcs cash prizes for Spring Egg Hunt:4/19 City Seal P.D. vehicle decals Mar legal notices:City Clerk Amount Paid 432.00 3,000.00 46.00 28.09 3.76 -26.70 500.00 2,009.00 50.00 1,240.50 1,708.84 1,708.84 219.08 92.32 80.06 59.76 55.32 49.80 29.65 5.28 280,55 151.60 5,125.00 2,005.00 550.00 580.99 709.00 Check Total 432.00 3,000.00 46.00 5.15 500.00 2,009.00 50.00 1,240.50 4,008.95 280.55 151.60 7,130.00 550.00 580.99 709.00 Page5 apChkLst Final Check List Page: 6 04/17/2003 8:22:18AM CITY OF TEMECULA Bank: union UNION DANK OF CALIFORNIA Check # Date Vendor 83644 04/17/2003 83645 04/17/2003 83646 04/17/2003 83647 04/17/2003 83648 04/17/2003 83649 04/17/2003 83650 04/17/2003 83651 04/17/2003 83652 04/17/2003 83653 04/17/2003 83654 04/17/2003 83655 04/17/2003 83656 04/17/2003 83657 04/17/2003 83658 04/17/2003 83659 04/17/2003 83660 04/17/2003 83661 04/17/2003 002880 PRO-CRAFT SASH & SUPPLY 005075 PRUDENTIAL OVERALL SUPPL 004529 QUAID TEMECULA HARLEY-DA 001364 R C P BLOCK & BRICK INC (Continued) Description Res Imp Prgm:Christensen, K. & C. Res Imp Prgm: Buckley, J. & W. Res Imp Prgm: Watson, M. & D. Mar Uniforms:TCSD Maint Crews Amount Paid Check Total repair/maint of PD motorcycles 4,180.00 3,890.00 1,588.00 944.25 9,658.00 944.25 Graffiti removal supplies 2,411.28 2,411.28 004792 R H A LANDSCAPE ARCHITECT Mar consulting svcs:V.R. Prk "C" 607~71 607.71 002612 RADIO SHACK INC 000879 RADISSON HOTEL 000262 RANCHO CALIF WATER DIST 000947 RANCHO REPROGRAPHICS 006127 REFSDAL, HEIDI 1,753.55 1,753.55 Misc Computer Supplies htI:SCACEO classes:4/25-26:T.C. Various water teeters dupl. blueprints:Community Theater dupl bluepdnts:Murrieta Creek Refund:Sports - Kids Love Soccer 003591 RENES COMMERCIAL MANAGE herbicidespraying:Murr. Crk 62.35 94.08 3,118.85 385.11 282.09 65.00 62.35 94.08 3,118.85 667.20 65.00 002412 RICHARDS WATSON & 004773 RIVERSIDE CO SHERIFFS 000406 RIVERSIDE CO SHERIFFS DEP 003587 RIZZOCONSTRUCTION INC 001097 ROADLINE PRODUCTS INC 000271 ROBERT BEIN WM FROST & A 004598 S T K ARCHITECTURE INC Feb 2003 legal services Oct-Dec 2002 legal services Feb 2003 Booking Fees FY 02/03 law enforcement rote adj. install cabinets:Chambers storage rm Sr Ctr roof coating parts for PW stencil truck Feb consulting svcs:l- 15/79S/Santiago Mar dsgn svcs for Roripaugh Fire Stn 625.00 75,826.02 36,477.19 9,936.00 243,434.28 2,066.00 1,391.34 56.64 606.81 7,099.75 625.00 112,303.21 9,936.00 243,434.28 3,457.34 56.64 606.81 7,099.75 Page~ apChkLst Fina~ Check List Page: 7 04/17/2003 8:22:18AM CITY OF TEMECULA Bank: union UN[ON BANI( OF CALIFORNIA Check # Date Vendor 83662 04/17/2003 004609 SHREDFORCE [NC (Continued) Description Amount Paid Check Total Apr document shredding services 32.50 32.50 83663 04/17/2003 000645 SMART&FiNALINC 83664 04/17/2003 000537 SO CALIF EDISON 83665 04/17/2003 001212 SO CALIF GAS COMPANY 83666 04/17/2003 000305 TARGET STORE 83667 04/17/2003 000309 TEMECULA COPIERS Supplies for Spring Egg Hunt Ice machine for Sr. Ctr. Rec supplies for High Hopes Supplies for Voorburg visit Credit: items returned various electric meters various electric meters Apr 2-00-987-0775 Vail Ranch Apr 2-10-331-1353 Stn 84 various gas meters Apr 095-167-7907-2 Stn 84 Rec class supplies - Teen prgm Supplies for Family Fun Night Mar usage costs:b/w copiers 1,789.18 1,786.44 313.79 27.92 -38.76 52,247.11 7,364.88 5,020.03 984.93 3,507.50 196.36 114.26 31.24 3,561.66 3,878.57 65,616.95 3,703.86 145.50 3,561.66 83668 04/17/2003 005412 TEMECULA GARDEN & POWER Repaidmaint of PW equipment Repair/maint of PW equipment 83669 04/17/2003 005737 TEMECULA PAD PQ Refund:Eng Deposit:26550 Ynez Rd 62.30 59.03 995.00 121.33 995.00 83670 04/17/2003 006129 TEMECULA VALLEY CHAMBER Refund:Sec. Deposit:3/29/03 100.00 100.00 83671 04/17/2003 83672 04/17/2003 83673 04/17/2003 004274 TEMECULAVALLEY SECURITY City Hall locksmith svcs City Hall locksmith svcs 003140 TEMECULAVALLEYTAEKYVON TCSDinstructoreamings TCSD instructor earnings 006055 TESTERMAN, NORMAN Refund:permit ovrpmt:41335 La Sierra 144.83 55.00 160.00 20.00 118.96 199.83 180.00 118.96 83674 04/17/2003 005964 TIM SKOPHAMMER GOLF TCSD Instructor Earnings 260.00 260.00 83675 04/17/2003 004001 U C REGENTS Res. Eng. Academy:4/22-25:W.M 250.00 250.00 83676 04/17/2003 002702 USPOSTALSERVICE Postage meter deposit 3,427.97 3,427.97 83677 04/17/2003 004789 VERIZON INTERNET SOLUTION Phone svcs/EOC backup @ stn 84 69.95 69.95 Paget apChkLst Final Check List Page: 8 04/17/2003 8:22:18AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83678 04/17/2003 001342 WAXIE SANITARY SUPPLY INC var parks trash liners Amount Paid Check Total 410,20 410,20 83679 04/17/2003 83680 04/17/2003 003730 WEST COAST ARBOR[STS 005101 WOODSIDE HOMES-PASEO D Citywide tree trimming maint svcs Various slope tree trimming svcs Park tree trimming maint svcs Refund:ovrpmt:32283 Caile Balareza 15,648.60 13,122.40 1,016.40 29,787.40 598.12 598.12 83681 04/17/2003 005902 XAVIERS FURNITURE REPAIR Repair chairs @ Fire Stn 84 1,200.00 1,200.00 Sub total for UNION BANK OF CALIFORNIA: 1,355,828.09 Pages apChkLst Final Check List Page: 1 04/24/2003 3:21:43PM CITY OF TEMECULA Check# Bank: union UNION BANK OF CALIFORNIA Date Vendor 111 04/24/2003 000283 INSTATAX (IRS) 112 04/24/2003 113 04/24/2003 83682 04/24/2003 83683 04/24/2003 83684 04/24/2003 83685 04/24/2003 83686 04/24/2003 83687 04/24/2003 83688 04/24/2003 83689 04/24/2003 83690 04/24/2003 83691 04/24/2003 83692 04/24/2003 83693 04/24/2003 83694 04/24/2003 000128 CAL SURANCE ASSOCIATES I 004971 CANON FINANCIAL SERVICES, 006169 CARLSON WAGONLIT TRAVEL 004405 COMMUNITY HEALTH CHARI 003610 DOMENOE, JIM 004192 DOWNS COMMERCIAL FUELI 002390 EASTERN MUNICIPAL WATER 002283 EMBASSY SUITES HOTEL 003347 FIRST BANKCARD CENTER Description Federal Income Taxes Payment 000444 INSTATAX (EDD) State Disability Ins Payment 000246 PERS (EMPLOYEES' RETIREME PERS ER Paid Member Contr Payme 002648 AUTO CLUB OF SOUTHERN CA Membership: Brad Buron 88550918 Membership: Chris Payne 72238014 Insurance Fire Rescue Truck City Copier lease for May May lease for stn 73 copier Airlare:St Crimes Sem:6/22-25:Staff Community Health Charities Payment Reimb:Air[are for Police Officers to Voorburg Fuel for city vehicles: 61343 Fuel for city vehicles: 61353 95366-02 Diego Dr Ldscp Htl:Ch[Idren's Museum conf: PR/MA XX-3083 Naggar:League Conf xx-5288 Jones:Supplies/Mtgs/Earlhlin xx-0902 O'Grady:Prof Mtg/CALED xx-6702 Meyer:Prof Mtgs in town xx-4117 Hughes:lMSA-trfc Manual xx-2576 Nelson: E-mail Access 001937 GALLS INC Compact Barrier Equip:Fire 005748 HODSON, CHERYLA. Support Payment 000194 I C M A RETIREMENT TRUST 45 ICMA Retirement Payment Amount Paid Check Total 59,927.93 59,927.93 13,797.10 13,797.10 49,404.14 49,404.14 44.00 44.00 88.00 230.00 230.00 6,727.20 149.77 6,876.97 1,593.00 1,593.00 173.50 173.50 1,943.52 1,943.52 662.72 600.34 1,263.06 110.33 110.33 1,394.64 1,394.64 1,4t7.56 743.57 595.00 177.96 92.00 13.11 3,039.20 187.30 187.30 33.06 33.06 6,423.60 6,423.60 Page:l apChkLst Final Check List Page: 2 04/24/2003 3:21:43PM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor (Continued) Description Amount Paid Check Total 83695 04/24/2003 005846 LEAGUE OF CALIF CITIES, LLC legislative mtg:5/14/03:J.Comerchero 30.00 30.00 83696 04/24/2003 005846 LEAGUE OF CALIF CITIES, LLC legislative mtg:5/14/03:R.Roberts 30.00 30.00 83697 04/24/2003 000394 MAINTENANCE MSAConf:8/19-21/03:R.West 395.00 395.00 83698 04/24/2003 001967 MANPOWER TEMPORARY SER temp help w/e 03/16 Gaier 1,853.28 1,853.28 83699 04/24/2003 006173 MELODY'S DANCE COMPANY Refund:Sec. Deposit/Room Rental 315.00 315.00 83700 04/24/2003 003448 MELODYS AD WORKS Consulting Svcs:Dixieland Festival 2,000.00 2,000.00 83701 04/24/2003 006174 MERCADOS, MYRA Refund:Sec. Deposit 100.00 100.00 83702 04/24/2003 001065 NATIONWIDE RETIREMENT SO Nationwide Retirement Payment 16,063.83 16,063.83 83703 04/24/2003 006140 NORTH JEFFERSON BUSINESS AssocDues:FrechVly/I-15:PW02-11 658.00 658.00 83704 04/24/2003 000359 PARKER, HERMAN ee computer loan prgm:Parker 2,000.00 2,000.00 83705 04/24/2003 001958 PERS LONG TERM CARE PROG PERS Long Term Care Payment 227.08 227.08 83706 04/24/2003 000249 PETTY CASH Petty cash reimbursement 463.94 Petty cash reimbursement 246.23 710.17 83707 04/24/2003 000262 RANCHO CALIF WATER DIST Various water meters 5,399.31 5,399.31 83708 04/24/2003 002907 REINHART FONTES Property Appraisal for Library Site 5,000.00 5,000.00 83709 04/24/2003 006171 REV. CHRISTI BUTLER Refcod:Sec. Deposit/Rcom Rental 153.00 153.00 83710 04/24/2003 003587 RIZZO CONSTRUCTION INC West Wing Mods for CIP Division 200.00 200.00 83711 04/24/2003 005227 SAN DIEGO COUNTY OF Support Payment 107.00 107.00 83712 04/24/2003 006176 SANTA ANA COLLEGE Fire Prevention 2A:6/9-13:McKuhn 125.00 125.00 Page2 apChkLst Final Check List Page: 3 04/24/2093 3:21:43PM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83713 04/24/2003 83714 04/24/2003 83715 04/24/2003 83716 04/24/2003 83717 04/24/2003 83718 04/24/2003 006176 SANTA ANA COLLEGE 006176 SANTA ANA COLLEGE 006176 SANTA ANA COLLEGE 006176 SANTA ANA COLLEGE 006176 SANTA ANA COLLEGE 000537 SO CALIF EDISON 83719 04/24/2003 83720 04/24/2003 83721 04/24/2003 83722 04/24/2003 83723 04/24/2003 83724 04/24/2003 83725 04/24/2003 83726 04/24/2003 83727 04/24/2003 83728 04/24/2003 83729 04/24/2003 (Continued) Description Fire Prevention 2A:6/9-13:J.Neuman Fire Prevention 2A:6/9-13:N.Mansilla Fire Prevention 2A:6/9-13:K.Cumming Fire Prevention 2B:7/28-8/1:J.McKuhn Fire Prevention 2C:8/18-22:J.McKuhn Apr 2-19-999-9442 various mtm Apr 2-24-817-8717 Old Kent Prk Apr 2-24-628-8963 Btrfld Stage Apr 2-24-151-6582 Overland Trl 005786 SPRINT AprAcct Level Chrgs 005906 STANDIFIRD, SHIRLEY TCSD Instructor Earnings 006144 TEMECULA SABRES ICE HOCK Refund:Sec. Deposit:Room Rental 000308 TEMECULA TOWN ASSOCIATI 000515 TEMECULA VALLEY CHAMBER 000311 TEMECULA VALLEY HIGH SCH 000668 TIMMY D PRODUCTIONS INC 004895 TUMBLES, J.W. 000389 U S C MWEST (OBRA) 000325 UNITED WAY 004261 VERIZON CALIFORNIA Refund:Temporary Use Permit Refund:Eng. Deposit:26790 Ynez Ct. Refund:Sec. Deposit:Grad Nite Spring Egg Hunt P.A. Sys & Tape Dec TCSD instructor earning OBRA - Project Retirement Payment United Way Charities Payment Apr various phones general usage Apr various phones general usage Apr xxx-1473 P.D. Satellite Stn Credit:Chrgs billed @ wrong rate Amount Paid 125.00 125.00 125.00 125.00 125.00 2,105.41 242.48 33.95 234.00 145.00 50.00 995.00 100.00 460.00 140.00 1,906.94 253.30 8,492.29 1,134.99 -3,885.54 Check Total 125.00 125.00 125.00 125.00 125.00 2,391.13 33.95 234.00 145.00 50.00 995.00 100.00 450.00 140.00 1,906.94 253.30 5,862.80 Page3 apChkLst Final Check List Page: 4 04/24/2003 3:21:43PM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83730 04/24/2003 006172 WATERBURY, STEVEN 83731 04/24/2003 005941 WILMOVSKY, DEBBIE 83732 04/24/2003 006147 WYNDHAM PALM SPRINGS HO Amount Paid Check Total Refund: Admin Citation #43972 60.00 TCSD Instructor Earnings 180.00 HtI:MSA Conf:8/18-21/03: R.West 432.24 Sub total for UNION BANK OF CALIFORNIA: 60.00 180.00 432.24 195,711.38 Page~ apChkLst Final Check List Page: 1 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83733 05/01/2003 004148 AT&T 83734 05/01/2003 83735 05/01/2003 83736 05/01/2003 83737 05/01/2003 83738 05/01/2003 000745 A T & T WIRELESS SERVICES 003304 ADAMS ADVERTISING INC 005068 ADKISSON, CANDiCE 002733 ALBAO, NANCY Description Long distance svcs: P.D. Long distance svcs: City Hall Mar Intemet svcs for fire t~blets Apr Internet svcs for fire tablets Old Town Billboard Change Outs Ann'l CPRS Conf:3/19-22:San Jose TCSD instructor earnings 004240 AMERICAN FORENSIC NURSES DUI:Drug/Alcohol Screening svc:Poli DUI:Drug/Alcohol Screening svc:Poli 83739 05/01/2003 000936 AMERICAN RED CROSS 83740 05/01/2003 006203 AMOS, MIKE Jr Lifeguard Training Supplies Refund:Parking Citation No. 0319 63741 05/01/2003 002187 ANIMAL FRIENDS OF THE VALL Mar animal controlservices 83742 05/01/2003 000101 APPLE ONE, INC. 83743 05/01/2003 001561 ARCH WIRELESS Temp help PPE 04/12/03 Kau Temp help PPE 04/05/03 Kau Temp help PPE 04/12/03 Atkinson Temp help PPE 04/19/03 Atkinson Temp help PPE 04/12/03 Delarm Temp help PPE 04/05/03 Delarm Temp help PPE 04/19/03 Delarm Temp help PPE 04/05/03 Kissam Temp help PPE 04/12/03 Kissam Temp help PPE 04/19/03 Kissam New pager shipping/handing chrg 83744 05/01/2003 003203 ARTISTIC EMBROIDERY Work shirts: Copy Center 83745 05/01/2003 006209 ASSOCIATION OF CHILDREN'S Ann'lConf:5/1-3:Ruse&Allen 83746 05/01/2003 002648 AUTO CLUB OF SOUTHERN CA Membership: Steven Sterling 885522 Membership:Jerzy Kanigowski 88552 Membership: Bruce Wedeking 88552 Amount Paid Check Total 148.92 19.64 168.56 202.81 201.99 404.80 400.00 400.00 86.26 86.26 666.40 666.40 120.00 24.00 144.00 215.00 215.00 50.00 50.00 6,565.43 6,565.43 416.00 520.00 481.00 442.00 608.40 592.80 561.60 760.50 663.00 624.00 5,669.30 13.00 13.00 206,88 206.88 1,310.00 1,310.00 44.00 44.00 44.00 132.00 Page:l apChkLst Final Check List 05101/2003 11:50:14AM CITY OF TEMECULA Page: 2 Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83747 05/01/2003 002713 BALLOONS GALORE 83748 05/01/2003 000622 BANTA ELECTRIC-REFRIGERA (Continued) Description Balloons: spring egg hunt event Balloons: Military Depend Day Install smoke dampers: City Hall Replaced burned out lamps: Museum Repair refrigerator @ TCC 83749 05/01/2003 002541 BECKERCONSTRUCTIONSRV Removal of silt & debris: Muirfield 83750 05/01/2003 004262 BIO-TOX LABORATORIES 83751 05/01/2003 003817 BLUE RIDGE MEDICAL 83752 05/01/2003 006165 BRINKER INTERNATIONAL 83753 05/01/2003 004176 BROADWING 83754 05/01/2003 005055 BROWN, STEVE 83755 05/01/2003 002363 C C P O A 83756 05/01/2003 000901 C P R S 83757 05/01/2003 001267 CALIF DEPTOF MOTOR 83758 05/01/2003 006184 CAMPBELL, SEAN 83759 05/01/2003 000131 CARLWARREN & COMPANY 83760 05/01/2003 006153 CARNAHAN, SUZANNE 83761 05/01/2003 002534 CATERERS CAFE 83762 05/01/2003 006166 CHAPARRAL HIGH SCHOOL, E DUI:Drug/Alcohol Screening svc:Poli DUI:Drug/Alcohol Screening svc:Poli Paramedic squad supplies:Fire Paramedic squad supplies:Fire Credit: Returned paramedic supplies Refund:Eng Dpst 41221 A Margarita R Long distance & intemet svcs Reimb: Team BIdg Lunch Membership: CSO L. Fanene Step Out for Sr Special Event 5/17/03 Police ATV vehicle registration Police ATV vehicle registration Refund: Exercise-Mom&Baby Yoga Claim adjuster services Refund:Sports-Kids Love Scccer Refreshments:Permit Plus User Group Refreshments:Permit Plus User Group Refshmnts: Staff Mt w/Attorney Refreshments:Permit Plus User Group Refreshments:Permit Plus User Group Refund: Secudty Deposit Amount Paid 366.35 328.50 1,675.00 594.00 331.00 4,180.00 861.10 398.10 433.46 126.00 -269.55 995.00 8~0.00 51.61 30.00 385.00 21.00 21.00 48.00 189.94 56.25 14.46 13.93 42.64 15.01 100.00 Check Total 694.85 2,600.00 4,180.00 1,259.20 289.91 995.00 350.00 51.61 30.00 385.00 42.00 48.00 189.94 56.25 119.37 100.00 Page2 apChkLst Final Check List Page: 3 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83763 05/01/2003 006207 CHEN, LEE-JEAN (Continued) Description Amount Paid Fac impr prgm: Rodeway Inn 190.00 177.79 223.04 24.00 45.00 88.29 59.42 797.96 622.64 99.07 300.00 583.62 1,010.16 300,000.00 13,837.20 2,019.87 350.00 275.00 9,682.50 50.00 50.00 66.81 83764 05/01/2003 001139 CHIP MORTON PHOTOGRAPHY Children's Museum photos 83765 05/01/2003 Refreshments:Captains prevention mt 83766 05/01/2003 Refund: Yoga For Today T/TH 83767 05/01/2003 Glass canopy cleaning: City Hall 83768 05/01/2003 Digital Camera accessories: PW Digital Camera accessories: PW Digital Cameras & accessories: PW Digital Cameras & accessories: PW Digital Camera accessories: PW 002147 COMPLIMENTS COMPLAINTS & Apr 19 Facepainter/Clown: CRC 000442 COMPUTER ALERT SYSTEMS WIN PAK 1.17 Software Package 000864 CORONA CLAY COMPANY INC Angel mix for City parks 001264 COSTCO WHOLESALE Year 10 payment per OPA 003739 COTTON BRIDGES ASSOCIATE Feb- Mar Update City General Plan 83769 05/01/2003 83770 05/01/2003 83771 05/01/2003 83772 05/01/2003 83773 05/01/2003 83774 05/01/2003 83775 05/01/2003 83776 05/01/2003 83777 05/01/2003 83778 05/01/2003 83779 05/01/2003 003628 CHUYS RESTAURANT 006158 CLARK, JOYCE 002989 CLEAR IMAGE WINDOW CLEA 001193 COMP U S A INC 004123 D L PHARES & ASSOCIATES 001716 DANS ROOFING 004569 DAVID TAUSSlG & ASSOCIATE 006193 DAWE, MADELINE 006199 DODDS, JR, WAYNE M 004781 DRAEGER SAFETY INC May Lease Police Satellite Office Roof repairs:Paloma Del Sol RR Res Imp Prgm: Comstock, James Special Tax Consulting:Butterfield CF Refund: Parking Citation No. 0279 Refund: Parking Citation No. 0318 Repair paris for Police Breathalyzer Check Total 190.00 177.79 223.04 24.00 45.00 1,667.38 300.00 583.62 1,010.16 300,000.00 13,837.20 2,019.87 625.00 9,682.50 50.00 50.00 66.81 Page3 apChkLst Final Check List Page: 4 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor 83780 05/01/2003 001380 E S I EMPLOYMENT SERVICES 83781 05/01/2003 003223 EDAW iNC Description Amount Paid Check Total Temp help PPE 04/18/03 Montecino 1,109.60 Temp help PPE 04/18/03 Novotny 915.09 Temp help PPE 04/18/03 Seng 1,176.80 Temp help PPE 04/04/03 Cammamta 1,148.29 Temp help PPE 04/18/03 Cammarota 1,137.56 Temp help PPE 04/18/03 Heer 2,290.73 Temp help PPE 04/18/03 Sragg 1,710.72 Temp help PPE 04/18/03 Kanigowski 1,410.40 Biological Monitoring: Lg Canyon Basi 2,887.10 10,899.19 2,887.10 83782 05/01/2003 006188 ELLISON, RICHARD Refund: Parking Citation No. 2224 50.00 50.00 83783 05/01/2003 006208 ENGINEERING &GENERAL StormWtrTmg:5/7-8:JoeStone 490.00 490.00 83784 05/01/2003 002939 ENVIRONMENTALSYSTEMS R 83785 05/01/2003 005251 EQUIPMENT REPAIR SERVICE GIS training classes for John DeGang 1,200.00 GIS training classes for Kelli Beal 800.00 Mobile Equip & Truck Repair Svcs:PW 385.00 2,000.00 385.00 83786 05/01/2003 006186 ESCONBEDO, ELIDIO Refund:Park-Picnic Area 30.00 30.00 83787 05/01/2003 000164 ESGIL CORPORATION Mar plan check svcs: B&S 9,949.53 9,949.53 83788 05/01/2003 006178 EVELAND, LISA Refund: Art* Creative Drawing 49.00 49.00 83789 05/01/2003 001056 EXCEL LANDSCAPE Mar Idscp impr: Campos Verdes Mar Idscp impr: Loma Linda Prk Mar Idscp impr: Kent Hintergardt Prk Mar Idscp impr: Loma Linda Park Mar Idscp impr: Winchester Crk Mar Idscp impr: repair controller Mar Idscp impr: Crowne Hill Park Mar Idscp impr: Ridgeview Mar Idscp impr: Meadowview Mar Idscp impr: Medusa Slope Mar Idscp impr: Vail Ranch Prkw,J Mar Idscp impr: Vail Rancho Prk B Mar Idscp impn Temeku Hills Mar Idscp impr: Campos Verdes Mar Idscp impr: Vail Ranch Prkwy Mar Idscp impr: Ridgeview & General Mar Idscp impr: Signet Series 75.00 51.22 75.00 75.00 75.00 175.00 150.00 135.00 300.00 184.51 179.13 532.80 375.00 315.18 1,600.00 1,170.00 800.00 Page~ apChkLst Final Check List Page: 5 05/0112003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83790 05/01/2003 002037 EXPANETS 83791 05/01/2003 83792 05/01/2003 000478 FAST SIGNS (Continued) Description Port T-1 card for C.H. telephone sys Relocate telephone system rack Repair & mntc city hall telephone equ 004464 EXXONMOBIL CARD SERVICES Fuel expense for City vehicles Annual spring egg hunt signs Printed signs for MP Sr Center City Hall Hours sign 000165 FEDERAL EXPRESS INC Express mail services 001511 FIELDMAN ROLAPP & ASSOCIA Financial Svs: Butterfield CFD 83793 05/01/2003 83794 05/01/2003 83795 05/01/2003 83796 05/61/2003 83797 05/01/2003 83798 05/01/2003 83799 05/01/2003 83800 05/01/2003 83801 05/01/2003 83802 05/01/2003 83803 05/01/2003 83804 05/01/2003 83805 05/01/2003 83806 05/0112003 000166 FIRST AMERICAN TITLE 003347 FIRST BANKCARD CENTER 001135 FIRSTCARE INDUSTRIALMED 006143 FOWLER, KATHY 006156 FULLER, TRAClE 001937 GALLS INC 005947 GOLDEN STATE OVERNIGHT 004607 GRACE BUILDING 006157 GRANICH, KRISTEN 000711 GRAPHICS UNLIMITED LITHOG 006160 GRAY, PATTY 003640 GRAYNER ENGINEERING Financial Svcs: Crown Hill CFD 03-1 Financial Svcs: Wolf Creek CFD CLTA Lit Svcs:Winchester Widening CLTA Lit Svcs:Winchester Widening xx-1405 Ubnoske:Prof Mtg$ Pm-employment physicals Refund: Hawaiian Dance Teen Begin Refund: Hawaiian Dance Teen Advanc Evac packs for mobile rescue units Express Mail Service: Fire Apr Custodial svcs for prk restrooms Credit: Ovrchged Mar Custodial svcs Refund: Security Depst Awd Banquet Layout & Design of 4th of July Logo Refund: Tiny Tots-Creative Beg Eng Svcs: Memantile Bldg Amount Paid 2,571.00 523.04 96.00 558.16 1,039.57 60.61 10.78 10.92 3,437.32 3,350.91 2,748.74 500.00 500.00 246.37 425.00 30.00 8.75 642.13 6.65 3,925.00 -379.86 100.00 118.73 30.06 513.75 Check Total 3,190.04 558.16 1,110.96 10.92 9,534.97 1,000.00 246.37 425.00 30.00 8.75 642.13 6.65 3,545.14 100.00 118.73 30.00 513.75 Page5 apChkLst Final Check List Page: 6 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83807 05/01/2003 83808 05/01/2003 83809 05/01/2003 83810 05/01/2003 006155 GREEN'S SHOWER DOOR 006154 GROVE, SHANNON & JUSTUS 005056 GUTIERREZ, BETH 006196 HAROLD STEPHENS PLUMBIN (Continued) Description Amount Paid Refund:Sports-Mens Softball Refund: Security Deposit EE qtrly luncheon supplies Refund: Parking Citation No. 0305 17.50 100.00 220.68 50.00 83811 83812 05/01/2003 002906 HEMET FENCE COMPANY 83813 05/01/2003 004811 HEWLETTPACKARD 83814 05/01/2003 000963 HOGAN, DAVID 83815 05/01/2003 003198 HOME DEPOT, THE 83816 05/01/2003 003938 lAN DAVIDSON LANDSCAPE-I 83817 05/01/2003 83818 05/01/2003 83819 05/01/2003 83820 05/01/2003 83821 05/01/2003 83822 05/01/2003 83823 05/01/2003 83824 05/01/2003 05/01/2003 006088 HARPER HOUF RIGHELLIS INC Windows CiviITools Software: CIP 001407 INTER VALLEY POOL SUPPLY I 006113 INTL ASSN OF FIRE CHIEFS- IA 001186 IRWIN, JOHN 006197 JOHNSON, JOHN 002575 JONES, SUSAN W. 005974 JUDGE NETrlNG INC 005054 K M E FIRE APPARATUS 006142 KENNEDY, BEVERLY Res Imp Prgm: Lopez, Felix Res Imp prgm: Martinez, Ricardo Compaq Tablet PC Docking Stn AEP '03 Conf:3/30-4/2/03 Res impr prgm: Silva, Jose First & Front St Gateway Project Pool sanitizing chemicals Membership: Jim McBride Membership: Howard Windsor TCSD instructor eamings Refund: Parking Citation 313 Ann'l City Clerk Coof:4/15-18: SJ / GF RC Sprt Prk Netting Projec~ Wheel covers for Fire Medics Refund: Dance-Youth Hawaiian Beg 1,513.89 4,280.00 2,320.00 265.07 363.74 2,136.95 2,420.00 365.36 255.00 240.00 316.00 50.00 99.01 4,500.00 174.16 8.75 Check Total 17.50 100.00 220.68 50.00 1,513.89 6,600.00 265.07 363.74 2,136.95 2,420.00 365.36 495.00 316.00 50.00 99.01 4,500.00 174.16 8.75 Pages apChkLst Final Check List Page: 7 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Chock # Date Vendor 83825 05/01/2003 83826 05/01/2003 83827 05/01/2003 83828 05/01/2003 83829 05/01/2003 83830 05/01/2003 83831 05/01/2003 83832 05/01/2003 83833 05/01/2003 83834 05/01/2003 83835 05/01/2003 83836 05/01/2003 83837 05/01/2003 83838 05/01/2003 83839 05/01/2003 83840 05/01/2003 83841 05/01/2003 001091 KEYSER MARSTON ASSOCIAT 006195 KHOYm, SHAHRZAD 000205 KIDS PARTIES ETC 006163 KING, EDWARD 003631 KLEINFELDER INC 004024 KOCH HEATING & AIR CONDIT 006187 KORDOS, RICHARD 004377 L O LYNCH WELLS & PUMP, IN 006141 LATHROP, DORY 000596 LEAGUE OF CALIF CITIES 004412 LEANDER, KERRY D, 006164 LENGYEL, DORm 006162 LEWIS, PHILLIP (Continued) Description Feb consulting svcs: Old Town Rehab Mar consulting svcs: Education facility Refund: Parking Citation No. 0303 2 party jumps w/attendants: CRC Generator rental: Easter Event Refund:Eng Dpst 42044 Winchester R Geotechn]cal Testing: Mercantile Bldg Res Imp Prgm: Comstock, James Refund: Parking Citation 2091 Duck pond pump system repairs Refund: Security Deposit 2003 CA Muni Law Updated Handbook TCSD instructor earnings TCSD instructor earnings TCSD instructor eamings TCSD instructor eamings Refund:Event Cancelled: Science Fair Refund: Eng Dspt: 42044 Wir~hester 004905 LIEBERT, CASSIDY & WHITMOR Mar general HR legal svcs Jan genera] HR legal svcs 8 backstroke pennants:CRC pool Refund: Socudty Deposit 004230 LINCOLN EQUIPMENTiNC 006167 LINGFIELD SCHOOL 004135 LOGIC COMPUTER PRODUCTS 4 DLT tapes for info Sys Amount Paid 4,194.45 1,593.75 50.00 247.50 55.00 497.50 923.00 1,180.00 50.00 900.00 100.00 75.00 138.00 120.00 212.00 194.67 30.50 497.50 528.00 360.00 503.47 100.00 1,038.88 Check Total 5,788.20 50.00 302.50 497.50 923.00 1,180.00 50.00 900.00 100.00 75.00 664.67 30.50 497.50 888.00 503.47 100.00 1,038.88 Page~ apChkLst Final Check List Page: 8 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83842 05/01/2003 83843 05/01/2003 006177 LONG, LISA 006200 LUJAN, LILLIAN 83844 05/01/2003 003054 LYNDE ORDWAY 83845 05/01/2003 003782 MAIN STREET SIGNS 83846 05/01/2003 004141 MAINTEX INC 83847 05/01/2003 004068 MANALILI, AILEEN (Continued) Description Refund: Music-For Toddlers Refund: Parking Citation No. 1949 Paper cutter blade sharpening: copy c Misc hardware & signs: PW Maint Misc hardware & signs: PW Maint CRC custodial supplies CRC custodial supplies TCSD instructor earnings 83848 05/01/2003 001967 MANPOWER TEMPORARY SER tamp help PPE 4/06 Dankworth temp help w/e 4/13 Gaier 83849 05/01/2003 002693 MATROS, ANDREA TCSD instructor earnings 83850 05/01/2003 83851 05/01/2003 83852 05/01/2003 83853 05/01/2003 83854 05/01/2003 83855 05/01/2003 83856 05/01/2003 83857 05/01/2003 002810 MCTRANS CENTER/UNIV OF F Ransyt 7F Upgrade/Signal Warrant eq 006159 MELGOZA, ALICIA Refund: CPR & First Aid Training 004894 MICHAEL BRANDMAN ASSOCIA Feb Pmf Svcs: Pechanga Pkwy 006185 MIGLIORE, ANTHONY Refund: Secudty Deposit Trcop 148 001384 MINUTEMAN PRESS 000973 MIRACLE RECREATION EQUIP Credit: original invoice not rec'd Business Cards:J. Walker Business Cards:J. McKuhn Business Cards:N. Mansilla Business Cards:T. Hafeli Business Cards: LN & TB Business Cards:L.Fanene Parks playground equip parts 001067 MITY LITE INC City Hall, Podium Cover 005887 MOFFATT & NICHOL ENGINEER Consultant svcs:French Vly Pkwy Amount Paid 42.00 50.00 61.52 609.33 407.30 135.38 113.34 644.00 1,482.63 224.48 200.00 855.00 43.69 4,154.31 100.00 -4.99 42.83 42.83 42.83 114.86 85.66 47.82 135.77 170.15 60,312.82 Check Total 42.00 50.00 61.52 1,016.63 248.72 644.00 1,707.11 200.00 855.00 43.00 4,154.31 100.00 371.84 135.77 170.15 60,312.82 Pages apChkLst Final Check List Page: 9 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83858 05/01/2003 006194 MORRIS, DOLORES JEAN Amount Paid Refund: Parking Citation 228 50.00 Check Total 50.00 83859 05/01/2003 004490 MUSCO SPORTS LIGHTING INC 83860 05/01/2003 001986 MUZAK INC install new lamps @ RC Sprt Prk Retrofit Lamps @ RC Sprt Prk Install new Lamps @ RC Spr~ Park Returned items: TCSD May O.T. Music Broadcasting -1,034.40 2,011.62 1,185.21 -248.00 59.50 1,914.43 59.50 83861 05/01/2003 83862 05/01/2003 002925 NAPA AUTO PARTS 000845 NATIONAL LEAGUE OF CITIES Misc Parts & Supplies for PW equip Misc Parts & Supplies for PW equip Misc Parts & Supplies for PW equip Books for planning dept. 110.94 107.74 34.94 15.00 253.62 15.00 83863 05/01/2003 006152 NEUMAN, AMY Refund:Dance-Youth Hawaiian Beg. 8.75 8.75 83864 05/01/2003 002898 NIXON EGLI EQUIPMENT COMP Repair PW Patchtreck 1,919.67 1,919.67 83865 05/01/2003 001599 NORTH COUNTY BASKETBALL Basketballofficialfees 54.00 54.00 83866 05/01/2003 003382 O'GRADY, JAMES B. CALED Conf:4/16-19:Moaterey 286.62 286.62 83867 05/01/2003 83868 05/01/2003 83869 05/01/2003 003964 OFFICE DEPOT BUSINESS SVS 002105 OLD TOWN TIRE & SERVICE 002668 OMEGA LAKE SERVICES Office Supplies: Police Office Supplies for Planning Credit returned office Supplies Office Supplies: Police Office Supplies: Police Storefrent Stn Office Supplies: Police Office Supplies: Police Office Supplies: Police Office Supplies for Planning City vehicle maint/repair svcs City vehicle maintJrepair svcs City vehicle maint/repair svcs City vehicle maint~repair svcs City vehicle maint/repair svcs May Duck Pond Water Maint Svcs 12.48 12.33 -348.32 296.36 161.61 51.96 763.52 348.31 315.97 22.42 19.19 252.85 216,06 69.95 800.00 1,614.22 580.47 800.00 83870 05/01/2003 006206 ON THE BORDER Cinco De Mayo Celebration 139.21 139.21 Page~ apChkLst Final Check List Page: 10 05/0112003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83871 05/01/2003 002256 P & D CONSULTANTS INC 83872 05/01/2003 005152 PACIFIC PRODUCTS & Amount Paid Check Total Mar bldg inspection svcs:Fadey Sign posts for sign installations 4,590.00 4,590.00 4,884.09 4,584.09 83874 05/01/2003 004074 PARTY CITY OFTEMECULA IN 83875 05/01/2003 006189 PAULSON PAINTING 83876 05/01/2003 003218 PELA 83877 05/01/2003 83878 05/01/2003 83879 05/01/2003 83880 05/01/2003 83881 05/01/2003 83882 05/01/2003 83883 05/01/2003 83884 05/01/2003 83885 05/01/2003 83873 05/01/2003 003955 PANE CONSULTING SERVICE ( Frisbee's for Military Depend Event Credit: Incorrectly billed Supplies for Spring Egg Hunt Refund: Parking Citation 1946 Mar Idscp plan ck: O.T. So. Gateway Refund: Exemise-Yoga for Today Piano/drum rental: Dixieland: 4/12-13 K-9 unit food and supplies Petty cash reimbursement 000580 PHOTO WORKS OF TEMECULA Phcto developing for Public Works 006179 PERRYMEN, ERIN 004953 PETE'S MUSIC 002861 PETSMART 000249 P~- ~ ~ ¥ CASH 006191 POPE, MARSHA 002354 POSITIVE PROMOTIONS 004957 PREMIER 000254 PRESS ENTERPRISE COMPAN 005563 R E FLEMING CONSTRUCTION 002612 RADIO SHACK INC 83886 05/01/2003 83887 05/01/2003 Refund: Parking Citation 307 EMS Pub Ed Materials Recognition shirts for Fire Prevention Mar recruitment ads for H.R. dept Mar construction update ads Mar legal notices: City Clerk Mar prgs pmt#6:Children's Mus. Credit: exceeds contract amount Misc Computer Supplies Misc Computer Supplies 774.38 -1.00 773.38 103.35 103.35 50.00 50.00 172.00 172.00 43.00 43.00 450.00 450.00 224.83 224.83 457.78 457.78 72.14 72.14 50.00 50.00 176.82 176.82 1,396.66 1,396.66 4,809.77 1,815.40 295.55 6,920.72 71,645.79 7,457.65 54,188.14 97.00 92.62 189.62 Page:l 0 apChkLst Final Check List Page: 11 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83888 05/01/2003 000262 RANCHO CALIFWATER DIST 83889 05/01/2003 83890 05/01/2003 83891 05/01/2003 83892 05/01/2003 83893 05/01/2003 83894 05/01/2003 000947 RANCHO REPROGRAPHICS 004584 REGENCY LIGHTING Apr 02-79-10100-1 Diaz Rd Apr 01-24-00732-2 Avenida/Reina Apr 01-99-02003-0 Floating Mtr Apr 01-24-00970-1 NW Sports Prk Blueprint Reproductions: Land Devel Various electrical supplies: City Fac Various electrical supplies: City Fac 003742 REHAB FINANCIAL CORPORATI Mar loan servicing 006168 REHM, BARRY& DEBORAH 002907 REINHART FONTES Refund:Eng Dpst TR 3883 Lot 331 Appraisal svcs: 27500 Jefferson Ave 003591 RENES COMMERCIAL MANAGE Post-Emergent Herbicides Application 83895 05/01/2003 002110 RENTAL SERVICE CORPORATI Parks rental equipment 83896 05/01/2003 005807 RESOURCE STRATEGIES INC 83897 05/01/2003 000266 RIGHTWAY 83898 05/01/2003 000353 RIVERSIDE COAUDITOR Historical Aerial Photograph for GIS GIS ER Mapper Compression software Equip rental: Lng Cyn Crk Park Portable toilet rental: Veterans Prk Portable restrooms: Old Twn Events Portable Toilet Rental: Riverton Prk RDA ed revenue augmentation fund 83899 05/01/2003 000267 RIVERSIDE CO FIRE 10/01-12/31/02 Fire Svcs 83900 05/01/2003 005705 RIVERSIDE CO PURCH & FLEE Paper supply for City Hall 83901 05/01/2003 000406 RIVERSIDE CO SHERIFFS DEP 83902 05/01/2003 001365 RIVERSIDE COUNTY OF 83903 05/01/2003 003587 RIZZOCONSTRUCTIONINC 83904 05/01/2003 000873 ROBERTS, RONALD H. FY 02-03 Facility Expenses Renew permit: Paloma Del Sol Park Renew permit: R.V. Snack Bar Construct 15' wall @ CRC APTA Commuter Rail Cf: 4/12-16:C Amount Paid 82.21 44.47 486.60 90.02 21.43 206.62 134.04 80.00 995.00 5,000.00 2,500.00 108.84 10,667.25 4,903.70 54.39 54.39 288.75 77.94 253,622.00 629,349.50 6,347.72 204,331.22 73.00 73.00 3,900.00 44.43 Check Total 703.30 21.43 340.66 80.00 995.00 5,000.00 2,500.00 108.84 15,570.95 475.47 253,622.00 629,349.50 6,347.72 204,331.22 146.00 3,900.00 44.43 Page:l 1 apChkLst Final Check List Page: 12 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA (Continued) Check # Date Vendor Description 83905 05/01/2003 006205 ROSAS CAFE & TORTILLA FAC Refreshments: Cinco de Mayo Amount Paid 168.15 3,394.00 108.00 50.00 8,060.00 374.00 110.00 224.00 83906 05/01/2003 003001 ROSS FENCE INC. Res Imp Prgm: Noble, Jeffrey 83907 05/01/2003 005018 SACHER, SUZANNE L. TCSD Instructor Earnings 83908 05/01/2003 006190 SCHAAP, TRUSTEE, EDGAR R Refund: Parking Citation 301 83909 05/01/2003 004562 SCHIRMER ENGINEERING COR Dec 02-Mar 03 plan check svcs: fire 83910 05/01/2003 000403 SHAWN SCOTT POOL & SPA April Pool Svcs @ Tern Elem School 83911 05/01/2003 004609 SHREDFORCEINC Apr document shredding services 83912 05/01/2003 003766 SMALL, SANDRA K. TCSD instructor earnings 83913 05/01/2003 83914 05/01/2003 83915 05/01/2003 000645 SMART & FINAL INC 000537 SO CALIF EDISON 000282 SO CALIF MUNICIPAL ATHLETI Credit: incorrect total on receipt Rec supplies for St. Ctr. Supplies for Spring Egg Hunt Recreation supplies for TCC Rec supplies for High Hopes Prgm Refreshments: Military Depend Day Apr 2-20-817-9929 Front St Apr 2-22-496-3439 Winchester Rd Apr 2*00-397-5067 various meters 04/24/03 Various Meters Apr 2-23-365-5992 Various Meters Mar-Apr 2-00-397-5042 City Hall Various electric meters Apr Various Meters Spring softball rule books -13.67 131.02 91.64 79.73 183.52 157.90 179.35 47.00 781.80 579.95 243.89 12,281.47 1,749.76 910.42 864.00 83916 05/01/2003 000519 SOUTH COUNTY PEST Pest Control Srvcs: Chapel Pest control svcs: P.D. Caboose Pest Control Srvcs: Sr Center Pest control Srvcs: Fire Stn 92 Pest Control Srvcs: Museum Pest Control Srvcs: TCC Pest Control Srvcs: CRC Removed bee hive @ Temeku Hill Prk Pest Control Srvcs: City Hall 32.00 29.00 29.00 42.00 42.00 36.00 90.00 84.00 56.00 Check Total 168.15 3,394.00 108.00 50.00 8,060.00 374.00 110.00 224.00 630.14 16,773.64 864.00 440.00 Page:12 apChkLst Final Check List Page: 13 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83917 05/01/2003 003836 SOUTHWEST RIVERSIDE 83918 05/01/2003 005786 SPRINT 83919 05/01/2003 000293 STADIUM PIZZA 83920 05/01/2003 002015 STAR WAY PRODUCTIONS 83921 05/01/2003 000752 STONE, JEFFREY 83922 05/01/2003 000305 TARGET STORE 83923 05/01/2003 003673 TECH 101 ARCUS INC (Continued) Description Membership dues for 2003:Econ.Dev. 3/15 - 4/14/03 cellular phone svcs Refreshments: Military Support Day Audio services for Dixieland Jazz Congressional City Cf: 3/7-11 :Wshgth Rec supplies for TCC Supplies for Family Fun Night Supplies for Spring Egg Hunt rec supplies for Sr. Ctr. Supplies for Spring Egg Hunt 2 PC Workstations for Police Misc Computer Supplies 83924 05/01/2003 005985 TECHNOLOGY INTEGRATION G Printer cartridge supplies Amount Paid 150.00 4,799.18 132.50 1,800.00 9.83 38.77 28.97 117.08 86.13 62.24 2,485.35 107.75 754.44 83925 05/01/2003 005274 TELESIO, JOHN 83926 05/01/2003 000307 TEMECULA TROPHY COMPAN 83927 05/01/2003 83928 05/01/2003 83929 05/01/2003 83930 05/01/2003 83931 05/01/2003 83932 05/01/2003 83933 05/01/2003 004274 TEMECULA VALLEY SECURITY 000919 TEMECULA VALLEY UNIFIED S 005964 TIM SKOPHAMMER GOLF 002452 TOP LINE INDUSTRIAL 003366 TORAN DEVELOP. & CONSTRU 005592 TWINING LABORATORIES 002065 UNISOURCE Planner's Institute: 3/20-22:San Diego Emp. of the Qtr:P. Comemhero Repair broken lock @ Museum Feb vehicle fuel usage Mar 03 vehicle fuel usage TCSD Instructor earnings Misc. Hoses & Fitting for ~ equip R&R Light Post in Old Town Inspect/Testing: Memantile Seismic Paper supplies for Copy Center 128.38 61.63 135.89 1,454.61 783.29 208.00 4.79 1,847.50 2,591.68 1,378.20 Check Total 150.00 4,799.18 132.50 1,800.00 9.83 2,593.10 754.44 128.38 61.63 135.89 2,237.90 208.00 4.79 1,847.50 2,591.68 1,378.20 Page~3 apChkLst Final Check List Page: 14 05/01/2003 11:50:14AM CITY OF TEMECULA Bank: union UNION BANK OF CALIFORNIA Check # Date Vendor 83934 05/01/2003 004981 UNISOURCE SCREENING & 83935 05/01/2003 005984 USA AQUATICSWEST INC 83936 05/01/2003 004261 VERIZON CALIFORNIA 83937 05/01/2003 83938 05/01/2003 83939 05/01/2003 83940 05/01/2003 83941 05/01/2003 83942 05/01/2003 83943 05/01/2003 83944 05/01/2003 83945 05/01/2003 83946 05/01/2003 83947 05/01/2003 83948 05/01/2003 004789 VERIZON INTERNET SOLUTION Apr Internet svcs:xx7411 Apr Internet svcs:xx0544 004848 VERIZON SELECT SERVICES I Apr long distance phone svcs 001881 WATER SAFETY PRODUCTS I 006201 WA'FrS, WENDY E 006198 WERNTZ, WADE 003730 WEST COAST ARBORISTS INC 005995 WESTWAYS & JOURNEY PUBL 003756 WHITE HOUSE SANITATION 000341 WILLDAN ASSOCIATES INC 006161 WOLLMAN, JENNIFER 006202 WOOD-JENKOT, ELAINA 004774 WOODCREST UNIFORMS Amount Paid (Continued) Description ee recruit background screening svcs 302.50 Female lifeguard uniforms 1,145.21 Apr xxx-3564 alarm 56.35 Apr xx.'<-2676 general usage 29.17 Apr xxx-0074 general usage 258.95 Apr xxx-2626 Police 238.91 Apr xxx-3526 fire alarm 84.53 69.95 69.95 5.37 10 - 19" Megaphones for Aquatics 190.00 Refund: Parking Citation 280 50.00 Refund: Parking Citation 40 50.00 Citywide Tree Trimming Svc 660.00 Mar slope tree maint svcs 244,00 Hold ad space in Westways Mag. 4,120.00 Portable toilet svcs: Butterfield Stage 50.00 Traffic Study Consultant Svcs 5,193.60 Refund: Tiny Tots-Creative Beg 50.00 Refund: Parking Citation 1928 50,00 Sewing svcs for P.D. 2,16 Sub total for UNION BANK OF CALIFORNIA: Check Total 302.50 1,145.21 667.91 139.90 5.37 190.00 50.00 50.00 904.00 4,120.00 50,00 5,193.60 50.00 50.00 2.16 1,784,709.89 Page:l 4 ITEM 4 TO: FROM: DATE: SUBJECT: II APPROVAL II CITY ATTORNEY II DIRSCTOR OF FINANC~ II CITY MANAGER CITY OF TEMECULA AGENDA REPORT City ManagedCity Council Genie Roberts, Director of Finan~t{~"~ May13,2003 City Treasurer's Report as of March 31,2003 PREPARED BY: RECOMMENDATION: March 31,2003. Karen Jest~'d, 7~ssistant Director of Fir~nce Pascale Brown, Senior Accountant ,~ That the City Council receive and file the City Treasurer's Report as of DISCUSSION: Government Code Sections 53646 and 41004 require reports to the City Council regarding the City's investment portfolio, receipts, and disbursements respectively. Attached is the City Treasurer's Report that provides this information. The City's investment portfolio is in compliance with Government Code Sections 53601 and 53635 as of March 31,2003. FISCAL IMPACT: None Attachments: City Treasurer's Report as of March 31,2003 City of Temecula City Treasurer's Report As of March 31, 2003 Cash Activi~ for the Month of March: Cash and Investments as of March 1, 2003 Cash Receipts Cash Disbursements Cash and Investments as of March 31,2003 $ 92,500,203 $ 91,954,590 Cash and Investments Portfolio: Type of Investment Petty Cash General Checking Sweep Account (Money Market Account) Flex Benefit Demand Deposits Local Agency Investment Fund Checking Account (Parking Citations) Delinquency Maintenance Account * CFD 88-12 (Investment Agreement) Delinquency Maintenance Account - CFD 88-12 (Money Market Account) Reserve Fund - CFD 88-12 (Investment Agreement) Special Tax Fund - CFD 01-2 (Money Market Account Admin Expense Fund - CFD 01-2 (Money Market Account Variable Bond Fund - CFD 01~2 (Money Market Account Capital interest Fund - CFD 01-2 (Money Market Account Interest Differential Fund - CFD 01-2 (Money Market Account Capital Improvement Fund - CFD 01-02 (Money Market Account Interest Account - RDA TABs (Money Market Account Reserve Account - RDA TABs (Money Market Account Project Account - RDA TABs (Money Market Account Project ACCOUnt-RDA TABs (Local Agency Investment Fund) Installment Payment Fund - TCSD COPs (Money Market Account) Delivery Cost Fund - TCSD COPs (Money Market Account) Project Fund - TCSD COPs (Money Market Account) Project Fund - TCSD COPs (Local Agency Investment Fund) Ins0tution Yield City Hall n/a Union Bank n/a Union Bank 0,180 % (Highmark U.S. Treasury) Union Bank n/a State Treasurer-LAIF 1.904 % Union Bank n/a CDC Funding Corp 5.430 % U.S. Bank (First Am. Treasury) 0,750 % CDC Funding Coq) 5.430 % U,S. Bank (First Am~ Treasury) 0.750 % U.S Bank (First Am. Treasury) 0.750 % U.S, Bank (First Am. Treasury) 0.750 % U.S. Bank (First Am. Treasury) 0.750 % U.S. Bank (First Am. Treasury) 0.750 % U.S. Bank (First Am. Treasury) 0.750 % US Bank (First Am, Treasury) 0.760 % U.S. Bank (First Am. Treasury) 0.750 % U.S. Bank (First Am. Treasury) 0.750 % State Treasurer-LAIF 1.904 % U.S. Bank (First Am. Treasury} 0.750 % U.S. Bank (First Am. Treasury) 0.75{) % U.S, Bank (First Am. Treasury) 0.750 % State Treasurer-LAIF 1.904 % Maturity/ Termination Date PadBook Balance 09/01/2007 $ 1,500 148,030 759,000 12,325 69,440,989 4,233 500,000 482,537 1,531,469 446,744 487,100 2,733 144,691 130,456 4,600,214 45 30,477 10,484,073 219 6,481 2,973 2,738,300 91,954,590 (1)-This amount is net of outstanding checks. (2)-At March 31, 2003 total market value (including accrued interest) for the Local Agency Investment Fund (LAIF) was $54,461,321,516. The City's proportionate sham of that value is $69,678,843, All investments are liquid and currently available. The City of Temecula's pe~olio is in compliance with the investment policy. Adequate funds will be available to meet budgeted and actual expenditures of the City of Temecula for the next six months. ITEM 5 APPROVAL CITY ATTORNEY~-~ DIRECTOR OF FINAN~E CITY MANAGER CITY OFTEMECULA AGENDA REPORT TO: FROM: DATE: SUBJECT: City ManagedCity Council Grant M. Yates, Director of Human Resources May 13, 2003 Pacific Profiles Agreement Approval RECOMMENDATION: That the City Council approve the Agreement for Consultant Services with Pacific Profiles to conduct Dynamics in Leadership Training Academies for the mid-management staff. BACKGROUND: The City has a proven track record of providing professional development programs for our employees. This proposal relates to a new management-training program that was instituted this year. Staff contracted with Pacific Profiles to conduct a management and leadership development-training program for mid-managers. This program has been verywell received to date and this contract needs to be amended by the City Council because it has the potential to exceed $25,000. FISCAL IMPACT: Funding for this program is included in the current operating year budget. AGREEMENT FOR CONSULTANT SERVICES THIS AGREEMENT is made and effective as of October 24, 2002 between the City of Temecula, a municipal corporation ("City") and Pacific Profiles Group, AKA: Nelsen, Wayne David ("Consultant"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. TERM. This Agreement shall commence on October 24, 2002, and shall remain and continue in effect until tasks described herein are completed, but in no event later than June 30, 2004, unless sooner terminated pursuant to the previsions of this Agreement. 2. SERVICES. Consultant shall perform the services and tasks described and set forth in Exhibit A, attached hereto and incorporated herein as though set forth in full. Consultant shall complete the tasks according to the schedule of performance which is also set forth in Exhibit A. 3. PERFORMANCE. Consultant shall at all times faithfully, competently and to the best of his or her ability, experience, and talent, perform all tasks described herein. Consultant shall employ, at a minimum, generally accepted standards and practices utilized by persons engaged in providing similar services as are required of Consultant hereunder in meeting its obligations under this Agreement. 4. PREVAILING WAGES. Pursuant to the provisions of Section 1773 of the Labor Code of the State of Califomia, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of workman needed to execute this Contractor from the Director of the Department of Industrial Relations. These rates are on file with the City Clerk. Copies may be obtained at cost at the City Clerk's office of Temecula. Consultant shall provide a copy of prevailing wage rates to any staff or sub-contractor hired, and shall pay the adopted prevailing wage rates as a minimum. Consultant shall comply with the previsions of Sections 1773.8, 1775, 1776, 1777.5, 1777.6, and 1813 of the Labor Code. Pursuant to the provisions of 1775 of the Labor Code, Consultant shall forfeit to the City, as a penalty, the sum of $25.00 for each calendar day, or portion thereof, for each laborer, worker, or mechanic employed, paid less than the stipulated prevailing rates for any work done under this contract, by him or by any subcontractor under him, in violation of the provisions of the Contract. 5. PAYMENT. a. The City agrees to pay Consultant monthly, in accordance with the payment rates and terms and the schedule of payment as set forth in Exhibit B, Payment Rates and Schedule, attached hereto and incorporated herein by this reference as though set forth in full, based upon actual time spent on the above tasks. Any terms in Exhibit B other than the payment rates and schedule of payment are null and void. This amount shall not exceed $43,000 for the total term of the Agreement unless additional payment is approved as provided in this Agreement. b. Consultant shall not be compensated for any services rendered in connection with its performance of this Agreement, which are in addition to those set forth herein, unless such additional services are authorized in advance and in writing by the City Manager. Consultant shall be compensated for any additional services in the amounts and in the manner as agreed to by City Uodated 4/1/~33 Manager and Consultant at the time City's wdtten authorization is given to Consultant for the performance of said services. The City Manager may approve additional work up to ten percent (10%) of the amount of the Agreement or $25,000.00, but in no event shall the total sum of the agreement (basic agreement amount and contingency amount) exceed twenty -five thousand dollars ($25,000.00). Any additional work in excess of this amount shall be approved by the City Council. c. Consultant will submit invoices monthly for actual services performed. Invoices shall be submitted between the first and fifteenth business day of each month, for services provided in the previous month. Payment shall be made within thirty (30) days of receipt of each invoice as to all non-disputed fees. If the City disputes any of consultant's fees it shall give written notice to Consultant within 30 days of receipt of an invoice of any disputed fees set forth on the invoice. 6. SUSPENSION OR TERMINATION OF AGREEMENT WITHOUT CAUSE. a. The City may at any time, for any reason, with or without cause, suspend or terminate this Agreement, or any portion hereof, by serving upon the consultant at least ten (10) days prior written notice. Upon receipt of said notice, the Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise. Ifthe City suspends or terminates a portion of this Agreement such suspension or termination shall not make void or invalidate the remainder of this Agreement. b. In the event this Agreement is terminated pursuant to this Section, the City shall pay to Consultant the actual value of the work performed up to the time of termination, provided that the work performed is of value to the City. Upon termination of the Agreement pursuant to this Section, the Consultant will submit an invoice to the City pursuant to Section 4. 7. DEFAULT OF CONSULTANT. a. The Consultant's failure to comply with the provisions of this Agreement shall constitute a default. In the event that Consultant is in default for cause under the terms of this Agreement, City shall have no obligation or duty to continue compensating Consultant for any work performed after the date of default and can terminate this Agreement immediately by wdtten notice to the Consultant. If such failure by the Consultant to make progress in the performance of work hereunder arises out of causes beyond the Consultant's control, and without fault or negligence of the Consultant, it shall not be considered a default. b. If the City Manager or his delegate determines that the Consultant is in default in the performance of any of the terms or conditions of this Agreement, it shall serve the Consultant with written notice of the default. The Consultant shall have (10) days after service upon it of said notice in which to cure the default by rendering a satisfactory performance. In the event that the Consultant fails to cure its default within such period of time, the City shall have the right, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice to any other remedy to which it may be entitled at law, in equity or under this Agreement. 8. OWNERSHIP OF DOCUMENTS. a. Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the Uodated 4/1103 performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identi- fled and readily accessible. Consultant shall provide free access to the representatives of City or its designees at reasonable times to such books and records, shall give City the right to examine and audit said books and records, shall permit City to make transcripts there from as necessary, and shall allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained fora period of three (3) years after receipt of final payment. b. Upon completion of, or in the event of termination or suspension of this Agreement, all odginal documents, designs, drawings, maps, models, computer files containing data generated for the work, surveys, notes, and other documents prepared in the course of providing the services to be performed pursuant to this Agreement shall become the sole property of the City and may be used, reused or otherwise disposed of by the City without the permission of the Consultant. With respect to computer files containing data generated for the work, Consultant shall make available to the City, upon reasonable written request by the City, the necessary computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. c. With respect to the design of public improvements, the Consultant shall not be liable for any injudes or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the written consent of the Consultant. 9. INDEMNIFICATION. The Consultant agrees to defend, indemni~, protect and hold harmless the City, its officers, officials, employees and volunteers from and against any and all claims, demands, losses, defense costs or expenses, including attorney fees and expert witness fees, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property arising out of Consultant's negligent or wrongful acts or omissions adsing out of or in any way related to the performance or non-performance of this Agreement, excepting only liability adsing out of the negligence of the City. 10. INDEPENDENT CONTRACTOR. a. Consultant is and shall at all times remain as to the City a wholly independent contractor. The personnel performing the services under this Agreement on behalf of Consultant shall at all times be under Consultant's exclusive direction and control. Neither City nor any of its officers, employees, agents, or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents except as set forth in this Agreement. Consultant shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of the City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner. b. No employee benefits shall be available to Consultant in connection with the performance of this Agreement. Except for the fees paid to Consultant as provided in the Agreement, City shall not pay salaries, wages, or other compensation to Consultant for performing services hereunder for City. City shall not be liable for compensation or indemnification to Consultant for injury or sickness adsing out of performing services hereunder. 11. LEGAL RESPONSIBILITIES. The Consultant shall keep itself informed of all local, State and Federal ordinances, laws and regulations which in any manner affect those employed byit or in anyway affect the performance of its service pursuant to this Agreement. The Updated 411/03 Consultant shall at all times observe and comply with all such ordinances, laws and regulations. The City, and its officers and employees, shall not be liable at law or in equity occasioned by failure of the Consultant to comply with this section. 12. RELEASE OF INFORMATION. a. All information gained by Consultant in ped'ormance of this Agreement shall be considered confidential and shall not be released by Consultant without City's prior written authorization. Consultant, its officers, employees, agents or subcontractors, shall not without wdtten authorization from the City Manager or unless requested by the City Attorney, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement or relating to any project or property located within the City. Response to a subpoena or court order shall not be considered "voluntary" provided Consultant gives City notice of such court order or subpoena. b. Consultant shall promptly notify City should Consultant, its officers, employees, agents or subcontractors be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed there under or with respect to any project or property located within the City. City retains the right, but has no obligation, to represent Consultant and/or be present at any deposition, headng or similar proceeding. Consultant agrees to cooperate fully with City and to provide City with the opportunity to review any response to discovery requests provided by Consultant. However, City's right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response. '13. NOTICES. Any notices which either party may desire to give to the other party under this Agreement must be in wdting and may be given either by (I) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice. Notice shall be effective upon delivery to the addresses specified below or on the third business day following deposit with the document delivery service or United States Mail as provided above. To City: To Consultant: City of Temecula Mailing Address: P.O. BOX 9033 Temecula, California 92589-9033 43200 Business Park Drive Temecula, California 92590 Attention: City Manager Pacific Profiles Group AKA: Nelsen, Wayne David 22835 Cove View St. Canyon Lake, CA 92587 U~dated 411/03 14. ASSIGNMENT. The Consultant shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without prior written consent of the City. Upon termination of this Agreement, Consultant's sole compensation shall be payment for actual services performed up to, and including, the date of termination or as may be otherwise agreed to in wdting between the City Council and the Consultant. 15. LICENSES. At all times during the term of this Agreement, Consultant shall have in full force and effect, all licenses required of it by law for the performance of the services described in this Agreement. 16. GOVERNING LAW. The City and Consultant understand and agree that the laws of the State of California shall govem the rights, obligations, duties and liabilities of the parties to this Agreement and also govern the interpretation of this Agreement. Any litigation concerning this Agreement shall take place in the municipal, superior, or federal district court with geographic jurisdiction over the City of Temecula. In the event such litigation is filed by one party against the other to enforce its rights under this Agreement, the prevailing party, as determined by the Court's judgment, shall be entitled to reasonable attorney fees and litigation expenses for the relief granted. 17. PROHIBITED INTEREST. No officer, or employee of the City of Temecula shall have any financial interest, direct or indirect, in this Agreement, the proceeds thereof, the Contractor, or Contractor's sub-contractors for this project, during his/her tenure or for one year thereafter. The Contractor hereby warrants and represents to the City that no officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the Contractor or Contractor's sub-contractors on this project. Contractor further agrees to notify the City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. 18. ENTIRE AGREEMENT. This Agreement contains the entire understanding between the parties relating to the obligations of the parties described in this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or wdtten, are merged into this Agreement and shall be of no further force or effect. Each party is entedng into this Agreement based solely upon the representations set forth herein and upon each party's own independent investigation of any and all facts such party deems material. 19. AUTHORITY TO EXECUTE THIS AGREEMENT. The person or persons executing this Agreement on behalf of Consultant warrants and represents that he or she has the authority to execute this Agreement on behalf of the Consultant and has the authority to bind Consultant to the performance of its obligations hereunder. 1fl~3dated 411/[33 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. CITY OFTEMECULA Jeffrey E. Stone, Mayor Attest: Susan W. Jones, CMC, City Clerk Approved As to Form: Peter M. Thorson, City Attomey CONSULTANT Pacific Profiles Group AKA: Nelsen, Wayne David Undated 4/1/03 EXHIBIT A TASKS TO BE PERFORMED The specific elements of this service include: conducting and facilitating Dynamics in Leadership Management Academies. Pacific Profiles Group will incorporate establishing goals and objectives along with instructional design Each academy will consist of nine (9) sessions with each consisting of two and one half hours of instruction and training of mid-management employees. The consultant will conduct pre-interviews and follow-up interviews with participants, supervisors, and executive staff. The consultant will also provide all materials necessary to complete the academy. The consultant will participate in a graduation ceremony with each of the academies and award a plaque of completion to each participant. Uodated 4/1/03 EXHIBIT B PAYMENT RATES AND SCHEDULE A fee of: $10,000 for 9 to 10 participants in an academy $11,400 for 11 to 12 participants in an academy and an houdy rate of $175.00 for any additional professional services. Hodated 4/I/03 ITEM 6 TO: FROM: DATE: SUBJECT: APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE CITY MANAGER CITY OF TEMECULA AGENDA REPORT City Manager/City Council Debbie Ubnoske, Director of Planning May 13, 2003 Meadows Village Development Plan (PA02-0273); Conditional Use Permit (PA02-0274) PREPARED BY: Rick Rush, Associate Planner RECOMMENDATION: That the City Council adopt the following Resolutions: 1. Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA DENYING PLANNING APPLICATION NO. PA02- 0273, A DEVELOPMENT PLAN FOR THE DESIGN, CONSTRUCTION AND OPERATION OF A 48,372 SQUARE FOOT GROCERY STORE, A 13,217 SQUARE FOOT DRUG STORE, A 11,571 SQUARE FOOT RETAIL BUILDING, A 10,568 SQUARE FOOT SHOP BUILDING AND A 9,603 SQUARE FOOT RETAIL BUILDING, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954- 030-001. 2. Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA DENYING PLANNING APPLICATION NO. PA02- 0274, A CONDITIONAL USE PERMIT TO OPERATE A DRIVE THROUGH AT A 13,217 SQUARE FOOT DRUG STORE, AND TO PERMIT THE SALE OF ALCOHOL AT A 48,427 SQUARE FOOT GROCERY STORE AND AT A 13,217 SQUARE FOOT DRUG STORE, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954-030-001. R:\D P~002\02-0273 Meadow Village\CC Staff Report 5-13-03.doc 1 BACKGROUND: On April 22, 2003, the City Council voted unanimously to deny the Planning Applications submitted by Venture Pointe for the proposed Meadows Village project. At this meeting the City Council directed staff to bring resolutions denying Planning Application No PA02-0273 (Development Plan) and Planning Application No. PA02-0274 (Conditional Use Permit) to the May 13, 2003, City Council meeting. DISCUSSION: Staff has attached the resolutions for denial of Planning Application No. 02-0273 and Planning Application No. 02-0274 as directed by the City Council. FISCAL IMPACT: None. R:~D P~002\02-0273 Meadow Village\CC Staff Report 5-13-03.doc 2 ATTACHMENTS: 1. Resolution Denying Planning Application No. PA02-0273 - Page 4 2. Resolution Denying Planning Application No. PA02-0274 - Page 5 R:\D P~002\02-0273 Meadow Village\CC Staff Report 5-13-03.doc 3 ATTACHMENT NO. 1 RESOLUTION DENYING PLANNING APPLICATION NO. PA02-0273 R:\D P~002\02-0273 Meadow Village\CC Staff Report 5-13-03.doc 4 RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA DENYING PLANNING APPLICATION NO. PA02- 0273, A DEVELOPMENT PLAN FOR THE DESIGN, CONSTRUCTION AND OPERATION OF A 48,372 SQUARE FOOT GROCERY STORE, A 13,217 SQUARE FOOT DRUG STORE, A 11,571 SQUARE FOOT RETAIL BUILDING, A 10,568 SQUARE FOOT SHOP BUILDING AND A 9,603 SQUARE FOOT RETAIL BUILDING, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954- 030-001. THE CITY COUNCIL OF THE CITY OF TEMECULA DOES HEREBY RESOLVE AS FOLLOWS: Section 1. declare that: The City Council of the City of Temecula does hereby find, determine and A. John Clement, Venture Pointe, filed Planning Application No. PA02-0273, A Development Plan for the design, construction and operation of a 48,372 square foot grocery store, a 13,217 square foot drug store, a 11,571 square foot retail building, a 10,568 square foot retail building, and a 9,603 square foot retail building located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Pamel No. 954-030-001 ("Project"). B. The application for the Project was processed and an environmental review was conducted as required by the California Environmental Quality Act. C. The Planning Commission of the City of Temecula held duly noticed public hearings on December 4, 2002, January 15, 2003 and February 19, 2003 to consider the application for the Project. D. Following consideration of the entire record of information received at the public hearing and due consideration of the proposed Project, the Planning Commission adopted Resolution No. 2003-011, recommending that the City Council approve Planning Application No. PA02-0273, A Development Plan for the design, construction and operation of a 48,372 square foot grocery store, a 13,217 square foot drug store, a 11,571 square foot retail building, a 10,568 square foot retail building, and a 9,603 square foot retail building; PA02-0274 a Conditional Use Permit located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Pamel No. 954-030-001. E. On April 22, 2003, the City Council of the City of Temecula held a duly noticed public hearing for Planning Application No. PA02-0273. F. On May 13, 2003, the City Council of the City of Temecula adopted by consent Resolution 2003- denying Planning Application No. PA02-0273. Section 2. The City Council of the City of Temecula hereby makes the following findings for denial pursuant to Development Code Section 17.05.010F: R:\D P~2002\02-0273 Meadow Village\CC Denial Reso DP.doc 1 A. The proposed grocery store is not in conformance with the current General Plan land use designation of Neighborhood Commercial. As defined in the General Plan "Neighborhood Commercial designation includes smaller-scale business activities which generally provide retail or convenience services for the local residents in the surrounding neighborhood (Page 2-29)." Small food markets less than 25,000 square feet are permitted in the Neighborhood Commercial zoning district, however the proposed 48,427 square foot supermarket is not a permitted use in the Neighborhood Commercial zoning district (Section 17.08.030). B. Goal number three of the General Plan Land Use Element requires a land use pattern that will protect and enhance residential neighborhoods be adopted. The City Council has adopted a land use pattern that in fact protects the residential neighborhoods. The proposed Development Plan application requests a 48,427-sqaure foot supermarket, which is not consistent with the General Plan. The project as proposed is not compatible with the surrounding single-family residences. The proposed project has not taken into account the general welfare of the surrounding property owners. The site plan has sited proposed buildings that have been determined to be too close to the existing single-family homes. C. Goal number three of the Community Design Element, states that the preservation of the character of the single-family neighborhoods and their protection from intrusions from buildings that are "out of scale", is of particular importance. The proposed amendment is not consistent with this goal by permitting future development that is "out of scale" in relation to the existing homes. Section 3. The City Council of the City of Temecula hereby denies Planning Application No. PA02-0273, a Development Plan for the design, construction and operation of a 48,372 square foot grocery store, a 13,217 square foot drug store, a 11,571 square foot retail building, a 10,568 square foot retail building, and a 9,603 square foot retail building, generally located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Parcel No. 954-030-001. Section 4. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED AND ADOPTED this 13th day of May, 2003 ATTEST: Jeffrey E. Stone, Mayor Susan W. Jones, CMC City Clerk [SEAL] R:\D P~002\02-0273 Meadow Vittage\CC Denial Reso DP.doc 2 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 03- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 13th day of May, 2003, by the following vote: AYES: NOES: ABSENT: ABSTAIN: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC City Clerk R:\D P~2002\02-0273 Meadow Village\CC Denial Reso DP.doc 3 ATTACHMENT NO. 2 RESOLUTION DENYING PLANNING APPLICATION NO. PA02-0274 R:\D P~2002\02-0273 Meadow Village\CC Staff Report 5-13-03.doc 5 RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING CERTAIN PORTIONS OF PLANNING APPLICATION NO. 02-0274, A CONDITIONAL USE PERMIT TO PERMIT THE SALE OF ALCOHOL AT A 48,372 SQUARE FOOT GROCERY STORE AND AT A 13,217 SQUARE FOOT DRUG STORE; AND DENYING THAT PORTION OF PLANNING APPLICATION NO. 02-0274, WHICH WOULD ESTABLISH A DRIVE-THROUGH LANE AT THE 13,217 SQUARE FOOT DRUG STORE, GENERALLY LOCATED SOUTH OF RANCHO CALIFORNIA ROAD AND EAST OF MEADOWS PARKWAY AND KNOWN AS ASSESSORS PARCEL NO. 954-030-001. THE CITY COUNCIL OF THE CITY OF TEMECULA DOES HEREBY RESOLVE AS FOLLOWS: Section 1. declare that: The City Council of the City of Temecula does hereby find, determine and A. John Clement, Venture Pointe, filed Planning Application No. PA02-0274, a Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and at a 13,217 square foot drug store, and a request to establish a drive-through lane at the 13,217 square foot drug store located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Parcel No. 954-030-001 ("Project"). B. The application for the Project was processed and an environmental review was conducted as required by the California Environmental Quality Act. C. The Planning Commission of the City of Temecula held duly noticed public hearings on December 4, 2002, January 15, 2003 and February 19, 2003 to consider the application for the Project. D. Following consideration of the entire record of information received at the public hearing and due consideration of the proposed Project, the Planning Commission adopted Resolution No. 2003-012, recommending that the City Council approve certain portions of Planning Application No. PA02-0274, a Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and at a 13,217 square foot drug store; and denied that portion of Planning Application No. 02-0274, which would have established a drive through lane at the 13,217 square foot drug store located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Parcel No. 954-030-001. E. On April 8, 2003, the City Council of the City of Temecula held a duly noticed public hearing on the Project at which time all persons interested in the Project had the opportunity and did address the City Council on these matters. F. On April 8, 2003, the City Council of the City of Temecula approved a Mitigated Negative Declaration and a Mitigation Monitoring Program for the Project when it adopted Resolution No. 03- , which was prepared pursuant to CEQA Guidelines Section 15072. R:\D P~002\02-0273 Meadow Village\CC Reso CUP.doc 1 Section 2. In approving the Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and at a 13,217 square foot drug store to the City Council of the City of Temecula hereby makes the following findings: A. The proposed project is consistent with the Land Use Element of the general plan. The request for alcohol sales meets the purpose and intent of a conditional use permit as defined in Section 17.04.010A of the development code. B. The proposed conditional use is compatible with the nature, condition and development of the adjacent uses, buildings and structures. The proposed request for the sales of alcohol in a grocery store and a drug store are typical uses found in other similar stores within the City. The request is for off-site consumption of alcohol and no alcohol will consumed on the site. Therefore, the adjacent single-family residences will not be impacted. C. The proposed conditional use permit for the sale of alcohol at a 48,372 square foot grocery store and at a 13,217 square foot drug store will be completely internal to both buildings. Therefore, it has been determined that the site is adequate in size and shape to accommodate the use. D. The nature of the proposed conditional use will not be detrimental to the general welfare of the community. Staff has determined with statistics from the Department of Alcoholic Beverage Control, Census Tract 0432.21 permits 11 off-sale licenses and currently there is only one active license within the Census Tract. The two proposed requests for off-sale liquor licensees would not create an undue concentration of Type-21 licenses in the area. E. The decision to approve that portion of Planning Application No. PA02-0274, A Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and at a 13,217 square foot drug store was based on substantial evidence in view of the record as a whole before the City Council. Section 3. In denying the Conditional Use Permit to establish a drive through lane at a 13,217 square foot drug store, the City Council of the City of Temecula hereby makes the following findings: A. The proposed conditional use permit is consistent with the General Plan However; the conditional use permit is not consistent with the Margarita Village Specific Plan. The Margarita Village Specific Plan does not permit drive through uses in Planning Area 19, where the proposed use is being requested. B. The proposed conditional use permit will not be compatible with the surrounding buildings and has the potential to have and adverse affect on the adjacent uses. The proposed drive through has the potential for creating a negative affect on the over all circulation for the site. C. In reviewing the proposed conditional use permit, it has been determined that the site is not a suitable size to accommodate the drive through lane. The drive through lane is located in an area that has been designated as a circulation path for the delivery trucks and customer parking. The location of the drive through lane has the potential to create conflicts between vehicles and delivery trucks. R:\D P~2002~02-0273 Meadow Village\CC Reso CUP.doc 2 D. The nature of the proposed conditional use is not detrimental to the health safety and general welfare of the community. But, it has been determined that due to the Iow volume of traffic generated by the drive-through, the proposed use will not serve as benefit to the general welfare of the community. E. The decision to deny that portion of Planning Application No. 02-0274, a Conditional Use Permit to establish a drive-through lane at a 13,217 square foot drug store was based on substantial evidence in view of the record as a whole before the City Council. Section 4. The City Council of the City of Temecula hereby approves that portion of Planning Application No. PA02-0274, a Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and a 13,217 square foot drug store; and denying that portion of Planning Application No. PA02-0274, which would establish a drive-through lane at the 13,217 square foot drug store, generally located at the southeast corner of Rancho California and Meadows Parkway, known as Assessor's Parcel No. 954-030-001 subject to the specific conditions of approval set forth in Exhibit A, attached hereto, and incorporated herein by this reference as though set forth in full. Section 5. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED AND ADOPTED this 8th day of April, 2003 A'FFEST: Jeffrey E. Stone, Mayor Susan W. Jones, CMC City Clerk [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 03- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 8th day of April, 2003, by the following vote: AYES: NOES: ABSENT: ABSTAIN: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC City Clerk R:\D P~002\02-0273 Meadow Village\CC Reso CUP.doc 3 EXHIBIT A CONDITIONS OF APPROVAL R:\D P~2002\02-0273 Meadow Village\CC Reso CUP.doc 4 EXHIBIT A CITY OFTEMECULA CONDITIONS OF APPROVAL Planning Application No.: PA02-0274 (Conditional Use Permit) Project Description: A Conditional Use Permit to permit the sale of alcohol at a 48,372 square foot grocery store and a 13,217 square foot drug store. DIF Category: Service Commercial Assessor's Parcel No.: 954-030-001 Approval Date: April 8, 2003 Expiration Date: April 8, 2005 PLANNING DIVISION Within Forty-Eight (48) Hours of the Approval of this Project The applicant shall deliver to the Community Development Department - Planning Division a cashier's check or money order made payable to the County Clerk in the amount of One thousand three hundred and fourteen dollars ($1314.00) for the County administrative fee, to enable the City to file the Notice of Determination required under Public Resources Code Section 21108(b) and California Code of Regulations Section 15075. If within said forty-eight (48) hour period the applicant has not delivered to the Community Development Department - Planning Division the check as required above, the approval for the project granted shall be void by reason of failure of condition [Fish and Game Code Section 711.4(¢)]. General Requirements The permittee/applicant shall indemnify, defend with counsel of City's own election, and hold harmless, the City and any agency or instrumentality thereof, and/or any of its officers, employees, and agents from any and all claims, actions, or proceedings against the City, or any agency or instrumentality thereof, or any of its officers, employees, and agents, to attack, set aside, void, annul, or seek monetary damages resulting from an approval of the City, or any agency or instrumentality thereof, advisory agency, appeal board or legislative body including actions approved by the voters of the City, concerning the Planning Application which action is brought within the appropriate statute of limitations period and Public Resources Code, Division 13, Chapter 4 (Section 21000 et seq., including but not by the way of limitations Section 21152 and 21167). The City shall promptly notify the permittee/applicant of any claim, action, or proceeding brought forth within this time period. The City shall estimate the cost of the defense of the action and applicant shall deposit said amount with the City. City may require additional deposits to cover anticipated costs. City shall refund, without interest, any unused portions of the deposit once the litigation is finally concluded. Should the City fail to R:~) P~2002\02-0273 Meadow Village\CC Reso CUP.doc 5 either promptly notify or cooperate fully, permittee/applicant shall not, thereafter be responsible to indemnify, defend, protect, or hold harmless the City, any agency or instrumentality thereof, or any of its officers, employees, or agents. The text of Amendment No. 6 to the Margarita Village Specific Plan shall conform to Exhibit "N", "Margarita Village Amendment No.6 "dated February 19, 2003. The Applicant shall submit ten (10) copies of the Amended Specific Plan to the Planning Department within 30 days of the approval date. All conditions shall be complied with prior to any occupancy or use allowed by this Conditional Use Permit. This Conditional Use Permit may be revoked pursuant to Section 17.03.080 of the City's Development Code. The permittee shall obtain City approval for any modifications or revisions to the approval of this Conditional Use Permit. This approval shall be used within two (2) years of the approval date; otherwise, it shall become null and void. By use is meant the beginning of substantial construction contemplated by this approval within the two (2) year period, which is thereafter diligently pursued to completion, or the beginning of substantial utilization contemplated by this approval. Prior to Commencement of Alcohol Sales The applicant shall be required to contact the Department of Alcoholic Beverage Control to verify that there is not an over concentration of "off-sale" licenses within Census Tract 0432.21 or the Census Tract in which the parcel is located. If at the time of a request for an "off-sale" liquor license, the Department of Alcoholic Beverage Control determines that the Census Tract is over concentrated; the applicant will be required to apply for a Public Convenience or Necessity Application with the City of Temecula. By placing my signature below, I confirm that I have read, understand and accept all the above Conditions of Approval. I further understand that the property shall be maintained in conformance with these conditions of approval and that any changes I may wish to make to the project shall be subject to Community Development Department approval. Applicant's Signature Name printed Date R:\D P~2002\02-0273 Meadow Village\CC Reso CUP.doc 6 ITEM 7 CITY ATTORNEY DIRECTOR OF FINAI~CE CITY MANAGER ~ r'~' CITY OF TEMECULA AGENDA REPORT TO: FROM: DATE: SUBJECT: City ManagedCity Council Jim O'Grady Assistant City Manager May 13, 2003 Community Grant Agreement with the Temecula Sister City Association Prepared by: Robin Gilliland, Senior Recreation Coordinator RECOMMENDATION: That the City Council: 1). Approve a grant in the amount of $10,000.00 for the Temecula Sister City Association for fiscal year 2002-2003. BACKGROUND: The Temecula Sister Cities Association (TSCA) is a California non-profit corporation that supports cultural exchanges of people and ideas between the citizens of our community and foreign communities. In doing so, the outlook of our citizens is enhanced and Temecula's quality of life improved. The following is a list of guidelines to assist City Administration in their liaison relationship with the Temecula Sister City Association and Sister City sponsored activities. · The City will work in conjunction with the TSCA to promote understanding, friendship and knowledge. The Temecula Sister City Association is responsible for the development, coordination and implementation of all Sister City functions, services and special events that occur related to our two Sister Cities: Leidschendam-Voorburg, Netherlands and Nakayama, Japan. This includes coordination of events, special dinners and activities, and travel related services such as gifts, itineraries for visiting dignitaries or travel abroad. The City will support and encourage the Temecula Sister City program in their efforts to encourage cultural exchange among our Sister Cities. The City will provide a staff liaison that will represent the City of Temecula at Sister City Board Meetings, programs, special events and activities (as deemed appropriate). The City liaison will coordinate travel abroad to our Sister Cities when City officials or City Council members are involved in the travel. p:\forms\city clerk forms\staff report - shell 1 The City will provide the Temecula Sister City Association with limited funding to provide necessary Sister City activities and functions. The Temecula Sister City Organization will be responsible for monitoring and managing their budget to ensure proper expenditures and accounting of funds for all organized activities and events. · The City will provide limited financial support for student scholarships for individual students traveling to Nakayama, Japan or Leidschendam-Voorburg, the Netherlands. The City will fund & coordinate one official dinner and one official welcome reception per year, for a visiting delegation from Nakayama and Leidschendam-Voorburg, when elected officials from the visiting Sister City are in attendance. · The City will provide official City gifts for elected officials visiting from Nakayama and Voorburg, or when City officials are traveling to Nakayama and Leidschendam-Voorburg. · Membership in the Sister City Association is open to ail citizens and or business persons of Temecula & others as determined by the TSCA. · The TSCA must provide an annual budget and financial reportJrecords that are available for review by the City. · The City will provide transportation for official delegations both arriving and traveling abroad. The TSCA is responsible for transportation of all other guests either coming or going to Nakayama, Japan & Leidschendam-Voorburg, the Netherlands. FISCAL iMPACT: Funds have been approved and are in account 001-101-999-5280. p:\forms\city clerk forms~staff report - shell 2 COMMUNITY GRANT AGREEMENT BETWEEN THE CITY OF TEMECULA AND THE TEMECULA SISTER CITY ASSOCIATION THIS AGREEMENT is made by and between the City of Temecula ("City"), a municipal corporation, and the Temecula Sister City Association, a non-profit corporation, and is dated as of May 13, 2003 in consideration of the mutual covenants and agreements contained herein, the parties agree as follows: 1. This Agreemem is made with respect to the following facts and purposes, which each of the parties hereto acknowledge and agree to be true and correct: a. The Temecula Sister City Association ("TSCA") coordinates many programs for cultural exchanges within the City of Temecula, which are not provided by the City's recreation program. b. The TSCA warrams and represems to the City that it is a non- profit, tax exempt corporation under the tax laws of the United State and California, and agrees to cominue in such status during the term of this Agreemem. b. On May 13, 2003, the City Council awarded a community services grant to the TSCA in the amount of ten thousand dollars ($10,000.00) for the purpose of continuing and enhancing its cultural exchange programs within the City of Temecula and abroad. The City Council allocated $10,000 for the costs of items indicated in Exhibit A for fiscal year 2002-2003. c. This Agreemem provides for the manner in which the gram will be paid to the TSCA. 2. The City shall pay to the TSCA on an annual basis, on July 1, 2002 an amount equal to the actual costs incurred by the TSCA not to exceed $10,000.00 per year ending June 30, 2003. TSCA shall submit a quarterly report to the Director of Community Services for the actual costs of cultural exchanges and shall be accompanied by such documentation as reasonably required by the Director of Finance to establish that such costs were incurred by the TSCA. 3. The term of this agreemem shall be July 1, 2002 to June 30, 2003. 4. The TSCA and City have developed goals and objectives which are set forth in Exhibit A. The TSCA is committed to implementing these Goals and Objectives. 5. The City may at any time, for any breach of this Agreemem, suspend or terminate this Agreement, or any portion hereof, by serving upon the TSCA at least ten (10) days prior written notice. If the breach is corrected during this ten day period, City may, in its sole and exclusive discretion, rescind the termination. If the City suspends or terminates a portion of this Agreemem such suspension or termination shall not make void or invalidate the remainder of this Agreemem. TSCA shall make available to the City its books, records and R:\Gillilr\Sister City Program\agreement~\TSCAI Conununity Grant Agreement-2002-2003-l.doc f'mancial documents in such form as to allow City to verify TSCA's compliance with the terms of this Agreement. 6. The TSCA agrees to defend, indemnify, protect and hold harmless the City, its officers, officials, and employees from and against any and all claims, demands, losses, defense costs or expenses, including attorney fees and expert witness fees, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property arising out of TSCA's negligent or wrongful acts or omissions arising out of or in any way related to the performance or non-performance of this Agreement, excepting only liability attributable to the active negligence of the City. 7. TSCA shall procure and maintain, or shall have provided on its behalf, for the duration of fiscal year 2002-2003 insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the activities of the TSCA, its agents, representatives, or employees. a. Minimum gert,ne of Inm~ranc'~. Coverage shall be at least as broad as: (1) Insurance Services Office Commercial General Liability form No. CG 00 01 11 85 or 88, including a non-owned auto endorsement. b. Minimnm I .imite of InRnrance. TSCA shall maintain limits on the policies described in Subsection a. of no less than the following amounts unless otherwise approved by the City Manager: (1) General Liability: One million dollars ($1,000,000) per occurrence for bodily injury, personal injury and property damage. C. D~dnctihle~ and ~qelf-lnenred Retentinne. Any deductibles or self-insured retentions must be declared to and approved by the City Manager. d. Other Insurance Prnvieiane. The general liability policies shall contain, or be endorsed to contain, the following provisions: (1) The City, its officers, officials, employees and volunteers are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of the TSCA; premises owned, occupied or used by the TSCA; or automobiles owned, leased, hired or borrowed by the TSCA. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees or volunteers. (2) For any claims related to this Agreement, the TSCA's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees and volunteers. Any insurance or self-insured maintained by the City, its officers, officials, employees or volunteers shall be excess of the TSCA's insurance and shall not contribute with it. R:\Gillilr\Sister City Program\agreements\TSCAl Community Grant Agreement-2002-2003-1.doc (3) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers. (4) The TSCA's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. (5) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, cancelled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice to the City by certified mail, return receipt requested, has been given to the City. e. Acee?ahility nf InRnrer~. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City. Self insurance shall not be considered to comply with these insurance requirements. f. Verification of Coverage. TSCA shall furnish the City with original endorsements effecting coverage required by this clause. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. The endorsements are to be on forms provided by the City. All endorsements are to be received and approved by the City before work commences. As an alternative to the City's forms, the TSCA's insurer may provide complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications. 8. TSCA is and shall at all times remain as to the City and TCSD a wholly independent contractor. The personnel performing the services under this Agreement on behalf of TSCA shall at all times be under TSCA's exclusive direction and control. Neither City nor any of its officers, employees or agents shall have control over the conduct of TSCA or any of TSCA's officers, employees or agents, except as set forth in this Agreement. TSCA shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of the City. TSCA shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner. 9. Any notices which either party may desire to give to the other party under this Agreement must be in writing and may be given either by (i) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice. Notice shall be effective upon delivery to the addresses specified below or on the third business day following deposit with the document delivery service or United States Mail as provided above. R:\Gillilr\Sister City Program\agreements\TSCAl Community Grant Agreement-2002-2003-1 .doc To City: City of Temecula 43200 Business Park Drive P.O. Box 9033 Temecula, California 92589-9033 Attention: City Manager To TSCA: Temecula Sister City Association 27349 Jefferson Ave. Suite 213 Temecula, California 92593 Attention: Ad Creemers & Jori Lieberg Co-Chairmen 10. The TSCA shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without prior written consent of the City. 11. This Agreement contains the entire understanding between the parties relating to the obligations of the parties described in this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged into this Agreement and shall be of no further force or effect. R:\Gillilr\Sister City Program\agreementsXTSCAI Community Grant Agreement-2002-2003-l.doc IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. CITY OF TEMECULA Jeffrey Stone, Mayor Attest: Susan Jones, CMC City Clerk Approved As to Form: Peter M. Thorson City Attorney TEMECULA SISTER CITY ASSOCIATION, a California non-profit corporation By: Name: Title: By: Name: Title: R:\Gillilr\Sister City Program\agreements\TSCAl Community Grant Agreement-2002-2003-1.doc ITEM 8 APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE CITY MANAGER TEMECULA REDEVELOPMENT AGENCY AGENDA REPORT TO: FROM: DATE: SUBJECT: City Council/Ci~(,J~ger Debbie Ubnosk~U'anning Director May 13, 2003 Pumhase and Sale Agreement for the Roripaugh Ranch Open Space Prepared By: Saied Naaseh, Senior Planner RECOMMENDATION: 1. Adopt a resolution entitled: RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THAT CERTAIN AGREEMENT ENTITLED "PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS" AND AUTHORIZE THE CITY MANAGER TO RECORD A DEED RESTRICTION AS REQUIRED BY ASSESSMENT DISTRICT (AD) 161 MULTIPLE SPECIES SUB-AREA HABITAT CONSERVATION PLAN FOR CERTAIN REAL PROPERTY DESCRIBED AS THE 201 ACRE RORIPAUGH RANCH OPEN SPACE PROPERTY IN THE CITY OF TEMECULA BACKGROUND: On November 26, 2002, the City Council approved the Roripaugh Ranch Specific Plan proposed by Ashby USA, LLC. As part of this approval, two hundred and one acres were designated as permanent open space. Prior to the City Council approval of the project, the applicant for the Roripaugh Ranch project entered into the AD 161 Agreement that required the dedication of this 201-acre site to the Riverside County Parks and Open Space District. An effort initiated by Mayor Pro Tem Naggar, has resulted in bringing this item forward to the City Council to transfer the ownership of this property to the City instead of the County. This property will expand the amount of open space land the City will own. R:~S PhRoripaugh Ranch S PXnew\OS Purchase and Sales A~eement CC 5-13-03.doc 1 Since the site is subject to the requirements of the AD 161 Agreement, this Purchase and Sales Agreement includes a detailed list of responsibilities for the City and Ashby USA, LLC prior to the recordation of the deed and prior to the issuance of grading permits for the Roripaugh Ranch project (refer to Attachment 2). AD 161 included provisions for funding the maintenance of the 201 acres. Ashby will pay the Center for Natural Lands Management (CNLM) a total of $439,298.00 for maintaining this area prior to the issuance of the grading permits for the Roripaugh Ranch Specific Plan project. In addition, Ashby USA, LLC has already paid $99,960.94 to the AD 161 trust account for initial maintenance purposes. Staff anticipates this amount to be sufficient to maintain the property as open space, trials, and where appropriate as a habitat preserve. These funds will be used to patrol the site, to prepare monitoring reports, and other items as deemed necessary by the CNLM to maintain the site. In addition, the CNLM will be responsible to maintain the fuel modification zones and the perimeter fencing; however, Ashby or the Roripaugh Ranch Home Owners Association (HOA) will pay for their maintenance. Ashby will also be required to install the perimeter fencing for the City's property, install the wetlands required by the mitigation measures of the project, and make flood control improvements to the Santa Gertrudis Creek within the 201 acres with Ashby or the HOA responsible for funding these three items. FISCAL IMPACT: The City will purchase the property for $1 that will be paid for from the General Fund. Ashby will pay CNLM a total sum of $439,298.00 for the maintenance of the open space area. Staff does not anticipate additional costs associated with maintaining the site as habitat. ATrACHMENTS: 1. CC Resolution No. 2003- Exhibit A Purchase and Sale Agreement and Escrow Instructions Roripaugh Ranch Open Space Purchase and Sales Agreement Matrix R:~S P~ofipaugh Ranch SPXnew\OS Purchase and Sales Agreement CC 5-13-03.doc 2 ATI'ACHMENT NO. 1 CC RESOLUTION NO. 03- R:~S P~Roripaugh Ranch SP~new\OS Purchase and Sales Agxeement CC 5-13-03.doc 3 CC RESOLUTION NO. 03- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THAT CERTAIN AGREEMENT ENTITLED "PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS" AND AUTHORIZE THE CITY MANGER TO RECORD A DEED RESTRICTION AS REQUIRED BY ASSESSMENT DISTRICT (AD) 161 MULTIPLE SPECIES SUB-AREA HABITAT CONSERVATION PLAN FOR CERTAIN REAL PROPERTY DESCRIBED AS THE 201 ACRE RORIPAUGH RANCH OPEN SPACE PROPERTY IN THE CITY OF TEMECULA NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: SECTION 1 The City Council of the City of Temecula hereby finds, determines and declares that: a. The City Council proposes to purchase the property described in the "Pumhase and Sale Agreement and Escrow Instructions" attached hereto as Exhibit A for open space and habitat purposes consistent with the AD 161. b. The City Council has duly considered all terms and conditions of the proposed Agreement and believes that such agreement is in the best interests of the City and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable State and local law requirements. c. The acquisition of property by itself will have no impact on the environment, as it is simply the change in ownership of the property without a change in the physical condition of the property. SECTION 2 The City Council of the City of Temecula hereby approves that certain "Purchase and Sale Agreement and Escrow Instructions" between the City Council of the City of Temecula, Ashby USA LLC, and Butterfield Development Company and authorize the City Manager to record a deed restriction as required by AD161 Multiple Species Sub-area Habitat Conservation Plan. The Mayor is hereby authorized and directed to execute the Agreement on behalf of the City of Temecula. SECTION 3. PASSED, APPROVED AND ADOPTED by the City of Temecula City Council this day of ., 2003 A'I-i'EST: Jeff Stone, Mayor Susan W. Jones, CMC/AAE R:~S P~Roripaugh Ranch SP~new\OS Purchase and Sales Agreement CC 5-13-03.doc 4 City Clerk [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the day of 2003, by the following vote: AYES: COUNCILMEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCILMEMBERS: ABSTAIN: COUNCILMEMBERS: Susan W. Jones, CMC/AAE City Clerk R:~S P~Roripaugh Ranch Sl~new\OS Parcbase and Sales Agreement CC 5-13-03.doc 5 EXHIBIT A PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS RAS P~Roripaugh Ranch SP~ew\OS Purchase and Sales Agreement CC 5-13-03.doc 6 PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS This Purchase and Sale Agreement and Escrow Instructions (this "Agreement") is made and entered into as of ., 2003 (the "Effective Date"), by and between the CITY OF TEMECULA, a general law City and a public body, corporate and politic (the "City"), and ASHBY USA, LLC, a California Limited Liability Company and Butterfield Development Co. Inc. (collectively the "Grantor"), with respect to the following facts: In consideration of the terms and conditions of this Agreement and for other valuable consideration, the receipt of which is hereby acknowledged, the City and Grantor agree as follows: 1. Intent of the Parties. A. Grantor is the fee owner of and desires to convey fee title to City for City to use for purposes the City deems to be in the public interest: 1) that certain tract or parcel of land situated in the City of Temecula, County of Riverside, State of California, more particularly described on Exhibit A attached hereto and made a part hereof, together with all and singular the rights and appurtenances pertaining to such property, including any right, title and interest of Grantor in and to adjacent streets, rights-of- way, or real property (collectively, the "Land"); 2) the buildings, structures, fixtures and other improvements presently on the Land or to be constructed on the Land by Grantor (collectively, the "Improvements"); 3) all of Grantor's right, title and interest in and to all tangible personal property upon the Land or within the Improvements and specifically described on Exhibit B attached hereto and made a part hereof(collectively, the "Personal Property"); and 4) those selected provisions of Grantor's duties, fights and interest in and to (i) all assignable contracts and agreements (collectively, the "Operating Agreements") listed and described on Exhibit C-1 (the "Operating Agreements Schedule") attached hereto and made a part hereof, relating to the upkeep, repair, maintenance or operation of the Land, Improvements or Personal Property which will extend beyond the date of the Close of Escrow (defined below), including specifically, without limitation, all assignable equipment leases, (ii) all assignable existing warranties and guaranties (expressed or implied) issued to Grantor in connection with the Improvements or the Personal Property (the property described in this clause(e) being sometimes herein referred to collectively as the "Warranties"); and (iii) those specified elements of existing permits, approvals, licenses, plans, specification or entitlements affecting the Land, its use or improvement in any manner, herein collectively referred to as the "Entitlements" also listed on Exhibit C-l.; all elements of the Entitlements listed on .Exhibit C-2 will become the obligation of City both as to cost and performance; all elements of the Entitlements not listed in Exhibit C-2 will remain the obligation of the Grantor as to cost and performance. The Land, the Improvements, the Personal Property, the Warranties and the Entitlements are hereinafter sometimes referred to collectively herein as the "Property." R:\S P~Roripaugh Ranch SP~newXPURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 1 a) C-1 Entitlements; Further Performances. The City and Grantor, respectfully, shall perform the duties or secure the rights as are described on Exhibit C-3. These performances are in addition to, or act to further explain the requirements of the Operating Agreements, Warranties and/or Entitlements. The time for performance shall be as required by the applicable Operating Agreement, Warranty, and/or Entitlement or as required by the terms of this Agreement. Exhibit C-3 shall not act to alter the terms of the Operating Agreement, Warranty and/or Entitlement and in the event of conflict the Operating Agreement, Warranty and/or Entitlement shall control. B. City desires to accept the specified elements of the Property from Seller and to ensure Grantor retains all other elements of the Property, as described in this Agreement. C. By this Agreement, Grantor is agreeing to grant the Property to City upon and subject to the terms and conditions set forth herein and to retain the obligations specified in the Property, expressly including, but not limited to the elements not listed on Exhibit C-2 and those listed in the Operating Agreement, Warranty and the Entitlements. 2. Purchase and Sale. Subject to and in accordance with the terms and conditions in this Agreement, including all Exhibits, hereinafter set forth, on the Close of Escrow (as herein defined), Grantor agrees to convey to City, and City agrees to accept from Grantor, the Property. 3. Opening and Closing of Escrow. Within five (5) days after the Effective Date, an escrow (the "Escrow") shall be opened with Orange Coast Title (the "Escrow Holder"), Attn: Mary Antinora, Escrow Officer (909-554- 6138). For the purposes of this Agreement, Opening of Escrow shall mean the date on which Escrow Holder shall have received a fully executed copy of this Agreement from City and Grantor. The "Close of Escrow" shall be the date that a grant deed for the Property in favor of City is recorded in the Official Records of the Riverside County Recorder's Office. The Close of Escrow shall occur immediately after the performance of all duties and obligations under this Agreement. 4. Purchase Price; Deposit; Escrow Account. A. The purchase price for the Property to be paid by City is the sum of One Dollar ($1.00) (the "Purchase Price"). B. Within ten (10) days after the Effective Date hereof, City shall deliver to Escrow Holder One Dollar ($1.00) (the "Deposit") in the form of a city warrant. On the Close of Escrow, the Deposit shall be applied as the Purchase Price. In the event that City terminates this Agreement on or prior to the expiration of the Due Diligence Period (as defined in Section 9), the Deposit shall be refunded to City. Upon the expiration of the Due Diligence Period, if this Agreement has not been terminated or deemed terminated as provided herein, the Deposit shall become non-refundable and shall be applied toward the Purchase Price at the Close of Escrow or R:\S P~Roripaugh Ranch SPXnew~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 2 retained by Grantor if the Close of Escrow does not occur solely as the result of(i) a default by City or (ii) City's termination of this Agreement (except in the event of a default by Grantor or the failure of a condition of City's obligation to pumhase the Property). The Deposit shall also be refundable to the City in accordance with the terms and conditions hereof. 5. Delivery of Documents on the Close of Escrow. A. On the Close of Escrow, Grantor covenants and agrees to cause to be delivered to City a duly executed and acknowledged Grant Deed in the form attached as Exhibit D attached hereto (the "Grant Deed") conveying to City all of Grantor's interest in the Property defined in this Agreement and further subject to the Permitted Title Exceptions (as hereinafter defined) approved by City, as provided below. B. On the Close of Escrow Grantor agrees to cause to be delivered to City a duly executed Bill of Sale (as defined below) and General Assignment (as defined below). C. At the Close of Escrow, City shall receive the Title Policy (as defined in Section 5) issued by First American (the "Title Company") insuring in City fee simple title to the Property, free and clear of all liens and encumbrances other than the Permitted Title Exceptions (as defined in Section 5). 6. Title and Title Insurance. A. Within five (5) days after the Effective Date, Grantor shall deliver to City a preliminary report for the Property from Title Company together with copies of all instruments noted as exceptions therein (the "Preliminary Title Report") and the most recent ALTA Survey of the Property as available in Grantor's possession or under Grantor's control Grantor, shall at its own sole cost, order an ALTA Survey for the Property pursuant to the terms set forth in Section 18 below (the "Survey"). B. City shall have ten (10) business days after the later of City's receipt of the Preliminary Title Report and/or the Survey to disapprove any exceptions to title shown on the Preliminary Title Report or reflected on the Survey (collectively, "Disapproved Exceptions") and to provide Grantor with notice of disapproval in writing describing the defect with reasonable particularity (the "Disapproval Notice"). Any exceptions to title not disapproved by City within such ten (10) business day period shall be deemed approved. Within five (5) days of Grantor's receipt of a Disapproval Notice, Grantor shall notify City in writing whether Grantor intends to remove the Disapproved Exceptions. If Grantor notifies City of an intention to eliminate the Disapproved Exceptions, Grantor shall do so at least five (5) days prior to the Close of Escrow. If Grantor indicates to City in writing within the time allowed that Grantor does not intend to remove any of the Disapproved Exceptions, City, by notifying in writing Grantor within five (5) days of Grantor's notice to City, may elect to terminate this Agreement or to take the Property subject to the Disapproved Exceptions. In any event, Grantor covenants to pay in full, prior to the Close of Escrow, any and all loans secured by mortgages and deeds of trust, any mechanics liens, all special bonded assessments encumbering the Property, and any other monetary liens or R:\S P~Roripaugh Ranch SPXnew~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 3 exceptions (other than current real property taxes which are not due and payable) prior to or concurrently with the Close of Escrow, and the Escrow Holder is hereby directed to cause same to be paid off from funds Grantor delivers to Escrow Holder at Escrow Holder's demand. The policy of title insurance shall include such endorsements as City shall reasonably request. Any title policy endorsements are to be paid for by City. Whether or not City shall have furnished to Grantor any notice of Disapproved Exceptions pursuant to the foregoing provisions of this Agreement, City may, three (3) days prior to the Close of Escrow, notify Grantor in writing of any objections to title (including any matters reflected on the City's Survey) first raised by the Title Company or the surveyor or disclosed to City between (a) the last date on which to City is entitled to make such an objection as set forth above and (b) the date on which the transaction contemplated herein is scheduled to close. With respect to any Disapproved Exceptions set forth in such notice, Grantor shall have the same option to cure (or in the case of a monetary lien, the obligation to obtain the removal thereof) and City shall have the same option to accept title subject to such matters or to terminate this Agreement as those which apply to any notice of Disapproved Exceptions made by City before the expiration of the Due Diligence Period. If Grantor elects to attempt to cure any such matters, the scheduled date for the Close of Escrow shall be automatically extended by a reasonable additional time to effect such a cure, but in no event shall the extension exceed fifteen (15) days after the scheduled date for the Close of Escrow set forth in Section 2. C. At Grantor's sole expense City's fee title to the Property shall be insured at the Close of Escrow by an ALTA Standard Coverage Owner's Policy of Title Insurance in the amount ofTen Million Fifty Thousand Dollars ($10,050,000.00), issued by Title Company (unless, at the option of City, the title shall be insured by an ALTA Extended Coverage Owner's Policy of Title Insurance) (the "Title Policy"). The Title Policy shall insure City's fee interest in the Property free and clear of all liens, encumbrances, restrictions, and rights-of-way of record, subject only to the following permitted conditions of title (the "Permitted Title Exceptions"): 1) Real property taxes for the then current tax fiscal year which are a lien not then due and payable; 2) The applicable zoning, building and development regulations of any municipality, county, state or federal jurisdiction affecting the Property; and 3) Those title exceptions approved by City pursuant to Section 5(b). Grantor shall not encumber, convey or agree to sell the Property to any other party during the period from the Effective Date to the Close of Escrow or the date of the termination of this Agreement. 7. Deposit of Documents and Funds in Escrow. A. Grantor and City, as applicable, hereby covenant and agree to deliver to Escrow Holder at least one (1) day prior to the Close of Escrow the following instruments, documents, and funds, the delivery of each of which shall be a condition of the Close of Escrow. R:\S PLRoripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 4 B. Grantor shall deliver: 1) The Grant Deed duly executed and acknowledged by Grantor; 2) Two (2) originals of a Bill of Sale in the form of Exhibit E attached hereto (the "Bill of Sale") duly executed by Grantor, conveying to City all of Grantor's right, title and interest in and to the Personal Property; 3) Two (2) originals of an assignment and assumption agreement in the form of Exhibit F attached hereto (the "General Assignment") duly executed by Grantor, assigning to City all of Grantor's right, title and interest in and to the Operating Agreements and Entitlements; 4) A Withholding Exemption Certificate Form 597W as contemplated by California Revenue and Taxation Code § 18662 (the "Withholding Affidavit") duly executed by Grantor; 5) A Certification of Non-Foreign Status in accordance with Internal Revenue Code Section 1445 duly executed by Grantor; Such funds as are required to pay for costs and expenses payable by 6) Grantor hereunder; 7) Such proof of Grantor's authority and authorization to enter into this transaction as the Title Company may reasonably require in order to issue the Title Policy. 8) True and correct copies of the Operating Agreements and licenses and permits, if any, in the possession of Grantor or Grantor's agents, together with all property files and records which are material in connection with the continued operation, use and maintenance of the Property. City; and C. City shall deliver: 1) Two (2) original counterparts of the Bill of Sale, duly executed by City; 2) Two (2) original counterparts of the General Assignment duly executed by 3) Such proof of City's authority and authorization to enter into this transaction as the Title Company may reasonably require in order to issue the Title Policy. 8. Authorization to Record Documents and Disburse Funds. Escrow Holder is hereby authorized to record the documents and disburse the funds and distribute the documents called for hereunder upon the Close of Escrow, provided each of the following conditions has then been fulfilled: A. The Title Company can issue in favor of City the Title Policy, with a liability R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 5 mount of Ten Million Fifty Thousand Dollars ($10,050,000.00) as referenced in paragraph 5(c), showing fee title to the Property vested in City, subject only to the Permitted Title Exceptions. If Grantor has not removed all monetary liens, monetary encumbrances, or special bonded assessments, or ifa monetary claim is asserted by any third party, in addition to all other remedies City may have at law or equity, City may elect to consummate this transaction on the Close of Escrow and offset dollar for dollar against the Purchase Price an amount equal to any such monetary encumbrances and claims. B. Escrow Holder shall have received City's authorization to close and City's notice of approval or satisfaction or waiver of all of the contingencies/conditions to City's obligations hereunder, as provided for in Section 13; C. Escrow Holder shall have received Grantor's authorization to close and Grantor's notice of approval or satisfaction or waiver of all of the contingencies/conditions to Grantor's obligations hereunder, as provided for in Section 14; and D. Grantor and City shall have deposited in Escrow the documents and funds required pursuant to Section 6. Unless other~vise instructed in writing, Escrow Holder is authorized to record at the Close of Escrow any instrument delivered through this Escrow if necessary or proper for the issuance of the Title Policy. 9. Escrow Charges and Prorations. A. Grantor shall pay (i) the escrow fees and charges of Escrow Holder, (ii) the cost of the premium for the ALTA Standard Coverage portion of the Title Policy, (iii) all costs and charges for recording the Grant Deed on the Property, (iv) any documentary or other local transfer taxes on the transfer of the Property, if any, and (v) Grantor's share of the charges prorated under this Agreement. If the Escrow shall fail to close for any reason, Grantor shall pay any applicable Escrow cancellation charges. B. City shall pay (i) the cost of the premium for the Title Policy in excess of the premium for an ALTA Standard Coverage policy, if any, and (ii) the cost of all endorsements to the Title Policy. C. The following shall be apportioned with respect to the Property as of 12:01 a.m., on the day on which the Close of Escrow occurs, as if City were vested with title to the Property during the entire day upon which the Close of Escrow occurs: 1) taxes (including personal property taxes on the Personal Property) and assessments levied against the Property; 2) payments under the Operating Agreements; R:XS P~Roripaugh Ranch SPXnew~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 6 3) gas, electricity and other utility charges for which Grantor is liable, if any, such charges to be apportioned at the Close of Escrow on the basis of the most recent meter reading occurring prior to the Close of Escrow; and 4) any other operating expenses or other items pertaining to the Property which are customarily prorated between a buyer and a seller in the area in which the Property is located. D. Notwithstanding anything contained in Section 8(c): Any installment of taxes or assessments for the current year paid at or prior to the Close of Escrow shall be prorated based upon the mounts actually paid. If taxes and assessments for the current year have not been paid before the Close of Escrow, Grantor shall be charged at the Close of Escrow an amount equal to that portion of such taxes and assessments which relates to the period before the Close of Escrow and City shall pay the taxes and assessments prior to their becoming delinquent. Any such apportionment made with respect to a tax year for which the tax rate or assessed valuation, or both, have not yet been fixed shall be based upon the tax rate and/or assessed valuation last fixed. To the extent that the actual taxes and assessments for the current year differ from the amount apportioned at the Close of Escrow, the parties shall make all necessary adjustments by appropriate payments between themselves following the Close of Escrow. All delinquent taxes and assessments (and any penalties therein) for periods prior to the Close of Escrow, if any, affecting the Property shall be paid by Grantor. E. All prorations shall be determined on the basis of a 365-day year. The provisions of this Section 8 shall survive the Close of Escrow. 10. Due Diligence Period; Access. During the period commencing on the Effective Date and ending at 5:00 p.m. on the date which is five (5) business days following the Effective Date (the "Due Diligence Period"), City may inspect the Property as necessary to approve all land use matters relating to the Property and to approve the physical condition of the Property. Grantor shall provide to City, on or before the Effective Date any and all documents, studies, and reports relating to the condition of the Property, including any analyses, surveys, environmental site assessments, and the like, in Grantor's possession or under Grantor's control, if any. City and its agents, attorneys, accountants, and other representatives shall have the right to enter upon the Property during the Due Diligence Period to make inspections and other examinations of the Property and the improvements thereon, including without limitation, the right to perform surveys, soil and geological tests of the Property and the right to perform environmental site assessments and studies of the Property. To evidence City's right of entry to the Property, the parties shall execute a Right of Entry Agreement, the form of which is attached hereto as Exhibit F. City to supply liability insurance prior to entering property. 11. Indemnification. A. Grantor hereby agrees to indemnify City against, and to hold City harmless and, at R:\S PXRoripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 7 the option of City, defend City, its officers, directors, employees, agents and representatives (collectively, "Indemnified Parties") with counsel approved by the Indemnified Parties, from all liabilities, losses, damages, costs and expenses, including, without limitation, legal fees and disbursements, incurred by Indemnified Parties by reason of any claims or litigation relating to the Property that arises from acts, occurrences, omissions or other matters, including, without limitation, the presence, use, release or disposal of Hazardous Substances that took place prior to the Close of Escrow. B. City agrees to give to Grantor written notice of any third party claim that may give rise to a claim for indemnification hereunder within ten (10) business days after learning of such third party claim; provided, however, that the failure to give timely notice as hereinabove provided shall not defeat any claim for indemnification hereunder except to the extent that the party to whom such notice was owing is prejudiced by the lack of such timely notice. The provisions of this Section 11 shall survive the Close of Escrow, the termination of this Agreement and/or the delivery of the Grant Deed. 12. Warranties, Representations and Covenants of Grantor. Grantor hereby represents, warrants and covenants to City the following, it being expressly understood and agreed that all such representations, warranties and covenants are to be true and correct, as of the Close of Escrow, and all of such representations, warranties and covenants shall survive the Close of Escrow, the termination of this Agreement and/or the delivery of the Grant Deed: A. Hazardous Substances. 1) To the best of Grantor's knowledge, the Property is free and has always been flee from Hazardous Substances (as defined in Exhibit G) except as noted in (i) the Environment Impact Report for Roripaugh Ranch dated September 26, 2002 and (ii) the SID Geotechnical, Inc. report, dated February 25, 2002 - Project No. 990057-01, and (iii) Phase I, Phase 1II, and an update to the prior SID Geotechnical Environmental Compliance Report, all of which are hereby incorporated by reference and referenced as the "HazMat Reports" and is not and has never been in violation of any Environmental Laws (as defined in Exhibit G). 2) There are no buried or partially buried storage tanks located on the Property. 3) Grantor has received no written notice, warning, notice of violation, administrative complaint, judicial complaint, or other formal or informal notice alleging that conditions on the Property are or have been in violation of any Environmental Law, or informing Grantor that the Property is subject to investigation or inquiry regarding Hazardous Substances on the Property or the potential violation of any Environmental Law. 4) There is no monitoring program required by the Environmental Protection Agency or any similar state agency concerning the Property. R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final,DOC 8 5) No toxic or hazardous chemicals, waste, or substances of any kind have ever been spilled, disposed of, or stored on, under, or at the Property, whether by accident, burying, drainage, or storage in containers, tanks, or holding areas, or by any other means except as identified in the HazMat Reports. 6) The Property has never been used as a dump or landfill except as identified in the HazMat Reports. 7) Grantor has disclosed to City all information, records, site assessment reports, remedial action plans and studies maintained by Grantor in connection with the Property and concerning Hazardous Substances, including, but not limited to, all of such information, records, reports and studies pertaining to the types and locations thereof. As part of this representation, Grantor shall provide City a Natural Hazards Disclosure Statement in accordance with California Civil Code Section 1103.2. Grantor has produced a list of all information, records, reports and studies maintained by Grantor or nnder Grantor's control in connection with the Property concerning Hazardous Substances and all existing orders and directives from or agreements with any governmental agency pertaining to the environmental condition of the Property and any requests for information, documents, access or investigation pertaining thereto and such list is contained in Exhibit I1 attached hereto. To the extent that certain documents contain confidential information, City shall sign a confidentiality agreement as a condition to City's review of such confidential documents. 8) Grantor covenants that it will keep all documents relevant to Hazardous Substances and pertaining to the Property for a period of 5 years following the Close of Escrow and will promptly provide copies of any or all of such documems to City upon receipt of City's written request therefore. 9) Grantor has made available to City all subpoenas, and all orders, directives and other requests for information from any government agency relating to Hazardous Substances and the Property, and all documents supplied by Grantor to a government agency in response. Grantor also has made available to City all requests for access, notices, warnings, notices of violation, orders, directives, administrative complaints from any government agency, and any judicial complaints, relating to Hazardous Substances and the Property, and all documents supplied by Grantor to a government agency in response. Each of these documents is listed in Exhibit H. There is no outstanding administrative or judicial subpoena, or other written request for any documents or information relating to Hazardous Substances and the Property to Grantor from any government agency. 10) Grantor has received no written request, directive, administrative order or judicial order to impose any type of land use restriction or institutional control relating to Hazardous Substances on the Property. R:~S P~.oripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final,DOC 9 11) There is no outstanding written order, directive or administrative complaint fi.om any government agency, no outstanding judicial complaint or order, and no current agreement with any govemment agency for any investigation or cleanup of any Hazardous Substance that is on or was released from the Property. B. No condition on the Property violates any environmental laws, or any other health, safety, fire, environmental, sewage, building, or other federal, state, or local law, code, ordinance, or regulation. C. Grantor is a California Limited Liability Corporation duly organized and validly existing under the laws of the State of California. D. Grantor has full right and power to execute, deliver and perform its obligations under this Agreement, and when executed and delivered, Grantor and all parties having an interest in the Property shall be lawfully bound by the terms of this Agreement. Grantor is the sole owner of the Property, free and clear of all liens, claims, encumbrances, easements, encroachments on the Property from adjacent properties, encroachments by improvements or vegetation on the Property onto adjacent property, or rights of way of any nature, other than those that may appear on the Preliminary Title Report. Grantor shall not further transfer or encumber the Property or allow the Property to be further encumbered prior to the Close of Escrow. E. Any information that Grantor has delivered to City, either directly or through Grantor's agents, is accurate and Grantor has disclosed to City all material facts with respect to the Property. F. There is no pending litigation or threatened litigation, which does or may adversely affect the Property. G. There is no eminent domain or similar condemnation proceeding affecting any portion of the Property now pending or, to Grantor's knowledge and belief, threatened. Further, there are no actions or proceedings pending or threatened against Grantor or the Property, before any court or administrative agency in any way connected with or relating to the Property, or affecting Grantor's ability to fulfill all of its obligations under this Agreement. H. There are no written or oral commitments to or agreements with any governmental authority or agency materially and adversely affecting the Property, or any part thereof or any interest therein, which will survive the Close of Escrow. Grantor has entered into no understanding or agreement with any taxing or assessing authority respecting the imposition or deferment of any taxes or assessments respecting the Property. City expressly agrees that Grantor can request, and City shall record, an easement(s) for County of Riverside Flood Control purposes across the Property. I. Neither this Agreement nor anything provided to be done hereunder including the transfer of title to the Property to City, violates or shall violate, any contract, instrument, partnership agreement, trust agreement, or any other agreement to which Grantor is a party, or which affects the Property or any part thereof, and the sale of the Property herein contemplated R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 10 does not require the consent of any party not a signatory hereto. J. Grantor is not in default of its obligations under any contract, agreement or instrument to which Grantor is a party which would adversely affect the value of the Property or Grantor's ability to perform its obligations hereunder. K. There are no natural or artificial conditions upon the Property or any part of the Property that could result in a material and adverse change in the condition of the Property. L. There are no mechanics', materialmen's or other claims or liens presently claimed or which will be claimed against the Property for work performed or commenced prior to the date of this Agreement or relating to the environmental condition of the Property. Grantor agrees to hold Indemnified Parties harmless from all costs, expenses, liabilities, losses, charges and fees, including without limitation attorneys' fees, arising from or relating to any such lien or any similar lien claimed against the Property and arising from work performed or commenced prior to the Close of Escrow. M. There presently are, and at the Close of Escrow there will be, no oral or written leases, contracts, agreements, licenses, commitments, or undertakings respecting maintenance of the Property, or the performance of services on the Property, or the use or occupancy of the Property or any part of it by which City would become obligated or liable to any person after the Close of Escrow except as authorized by this Agreement; and there are no deed restrictions or institutional controls on the use of the Property relating to Hazardous Substances. N. There are no written or oral leases or contractual rights or options to lease, purchase, or otherwise enjoy possession, or any other rights or interests of any nature in and to the Property or any part thereof, and no persons have any right of possession to the Property or any part thereof. Grantor shall deliver possession of the Property to City free of all tenants and other persons or entities, and shall indemnify and hold Indemnified Parties harmless from the claims of any tenants or persons or entities claiming a right to possession relating to Grantor's occupancy of the Property and arising before or after the Close of Escrow. O. Grantor is not a "foreign person" within the meaning of Section 1445(0(3) of the Internal Revenue Code. P. The agreements identified on the Operating Agreements, Warranty and Entitlement Schedules are all of the contracts, permits, entitlements, plans, approvals, or agreements, such as maintenance, service, or utility contracts relating to or affecting the Property. Q. The documents identified on the Operating Agreements, Warranty and Entitlement Schedule are all of the leases, licenses, occupancy agreements, or other agreements demising space in, providing for the use or occupancy of, or otherwise similarly affecting or relating to, the Property. R. There are no obligations with respect to the Property which will be binding upon City after the Close of Escrow except: (i) matters which are set forth in the Preliminary Title R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 11 Report, and (ii) the portions of Operating Agreements accepted by City, if any, (to the extent the same are approved and assumed by City). S. Neither Grantor nor, to Grantor's knowledge, any of the tenants under the Leases has either filed or been the subject of any filing of a petition under the Federal Bankruptcy Law or any federal or state insolvency laws or laws for composition of indebtedness or for the reorganization of debtors. Grantor shall notify City of any facts that would cause any of the representations contained in this Agreement to be untrue as of the Close of Escrow. Grantor agrees to indemnify Indemnified Parties and agrees to defend and hold Indemnified Parties harmless from all loss, costs, liability, expense, damage, or other injury, including without limitation attorneys' fees and expenses, and all other costs and expenses incurred by mason of, or in any manner, direct or indirectly, resulting from the breach of any warranties and representations in this Section. The provisions of this Section shall survive the Close of Escrow, the termination of this Agreement and/or delivery of the Grant Deed. 13. Representations and Warranties of City. City hereby represents and warrants to Grantor the following, it being expressly understood and agreed that all such representations and warranties am to be true and correct at the date of this Agreement and as of the Close of Escrow: A. City has the full power and authority to enter into this Agreement and consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement has been duly and validly authorized by City, and no other action by City is requisite to the valid and binding execution, delivery, and performance of this Agreement by City. B. There is no pending litigation or, to the best of City's knowledge, threatened litigation, which does or will materially adversely affect City's ability to consummate this transaction. 14. City's Conditions. City's obligations under this Agreement are expressly made subject to the following conditions precedent solely for the benefit of City. The Close of Escrow and City's obligation to consummate the purchase of Property shall be contingent upon and subject to written notice to Escrow Holder by City of the occurrence of all of the following (or City's written waiver thereof, it being agreed that City can waive any or all such contingencies) on or before the Close of Escrow. City to accept provisions of the A.D. 161 HCP Plan only as to cause to operate and maintain by a third party the land and habitat. All payment obligations within said HCP Plan remain Grantor's sole obligation. A. City's obtaining a satisfactory commitment issued by Title Company to issue the RAS PXRoripaugh Ranch SPXnew'xPURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 12 Title Policy in favor of City with a liability amount equal to the Purchase Price showing City's fee interest in the Property subject only to the Permitted Title Exceptions, and being otherwise in accordance with the provisions of paragraph 5 of this Agreement, and expressly insuring against the claims of any persons in possession of all or any part of the Property and the claims of any mechanics or materialmen. B. City's receipt of Grantor's representation that there are no mechanics' and/or materialmen's liens, or lis pendens actions affecting the Property, and that all taxes, sewer, water, and utility bills and/or connection fees have been paid. C. City's performing such environmental analysis of the Property as it deems appropriate to determine, to its complete satisfaction, that the Property has not been used for the storage of any petroleum products, toxic materials, or Hazardous Substances (as defined in Exhibit G attached hereto), and that no petroleum product, hazardous substance or toxic material is or has been located on, in or under the Property except as identified in the HazMat reports. D. That as of the Close of Escrow the representations and warranties of Grantor contained in this Agreement are all true and correct. E. Grantor's delivery of all documents required to be delivered by Grantor pursuant to Section 6 hereof. F. City's approval, prior to the expiration of the Due Diligence Period, of the physical condition of the Property, including without limitation, any and all inspections, tests, Survey(s), and other studies to be conducted by City, in City's sole discretion, including without limitation, any environmental site assessments, investigations, studies and reports that may be required under the California Environmental Quality Act CCEQA"). City's approval of any such inspections of the Property shall not alter or diminish Grantor's representations or warranties under this Agreement, and Grantor acknowledges and agrees that City is nonetheless relying on Grantor's representations and warranties made herein, unless such representation or warranty is specifically waived in whole or in part by City in writing. G. If City has elected to obtain the same, City's obtaining and approving the Survey provided for herein. H. 1. Grantor has prepared and delivered written notice to the respective agencies which have issued the AD 161 MSSHCP Plan, the 401 permit, the 404 permit, the 1603 permit and received written consent and/or acknowledgment of the conveyance of the fee title to City and Grantor's retention of all obligations, duties, performances and payments required by each agency, all to City's satisfaction. 2. Notice to Issuers of Exhibit C-1 permits. Prior to the City accepting the Deed, Grantor shall, in writing, advise the agency that issuer of the 401 permit, 404 permit, 1603 permit and the AD 161 HCP Agreement, as referenced on Exhibit C-1 that Grantor is transferring fee title to the Property to City but retaining all the obligations under each respective permit. Grantor shall also give City notice as to any and all attempts to transfer the duties or obligations R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 13 of the 401 permit, 404 permit, 1603 permit or AD 161 HCP Agreement to any third party. This obligation shall survive this Agreement and shall terminate at the time the performances under all the Operating Agreements, Warranty or Entitlements have been performed as required. If all the foregoing conditions precedent have not been either met to City's sole satisfaction or expressly waived in writing by City on or before the respective dates set forth therein, or if no date is set forth therein on or prior to the Close of Escrow, then this Agreement shall, at the option of City, become null and void, in which event, except as expressly set forth in this Agreement, neither party shall have any further rights, duties and obligations hereunder, and City shall be entitled to the immediate refund of the Deposit. In addition, City may terminate this Agreement in City's sole and absolute discretion for any reason, or for no reason whatsoever, by giving written notice to the Grantor on any day prior to and including the final day of the Due Diligence Period, in which event, this Agreement shall become null and void and, except as expressly set forth in this Agreement, neither party shall have any further rights, duties and obligations hereunder, and City shall be entitled to the immediate refund of the Deposit. 15. Condemnation; Destruction. All risk of loss with respect to the Property shall remain with Grantor until after the Close of Escrow and delivery of possession of the Property to City. If at any time prior to the Close of Escrow, the Property, or any portion thereof, is damaged by fire or other casualty or taken or appropriated through eminent domain or similar proceedings, or is condemned for any public or quasi-public use, City may terminate this Agreement. If City terminates this Agreement, Grantor shall be entitled to receive all insurance proceeds payable to City or Grantor or all condemnation proceeds actually paid for that portion of the property taken. If City elects to maintain this Agreement in full force and effect, City shall be entitled to receive all insurance proceeds payable to Grantor or all condemnation proceeds actually paid for that portion of the Property taken or, if such proceeds have been paid to Grantor, City shall receive a credit against the Purchase Price and Relocation Assistance Payment equal to the amount of proceeds actually paid to Grantor. 16. Default. In the event of a breach or default trader this Agreement by either Grantor or City, the non- defaulting party shall have the right to terminate this Agreement and the Escrow for the purchase and sale of the Property by delivering written notice thereof to the defaulting party and to Escrow Holder, and if City is the non-defaulting party, City shall thereupon promptly receive a refund of the Deposit. Such termination of the Escrow by a non-defaulting party shall be without prejudice to the non-defaulting party's rights and remedies against the defaulting party at law or equity. IF CITY FALLS TO COMPLETE THE PURCHASE OF THE PROPERTY AS HEREIN PROVIDED BY REASON OF ANY DEFAULT OF CITY, IT IS AGREED THAT THE DEPOSIT SHALL BE NON-REFUNDABLE AND GRANTOR SHALL BE ENTITLED TO SUCH DEPOSIT, WHICH AMOUNT SHALL BE ACCEPTED BY GRANTOR AS LIQUIDATED DAMAGES AND NOT AS A PENALTY AND AS GRANTOR'S SOLE AND EXCLUSIVE REMEDY. IT IS AGREED THAT SAID AMOUNT CONSTITUTES A REASONABLE ESTIMATE OF THE DAMAGES TO GRANTOR PURSUANT TO R:\S PhRoripaugh Ranch SPhnew~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 14 CALIFORNIA CIVIL CODE SECTION 1671 ET SEQ. CITY AND GRANTOR AGREE THAT IT WOULD BE IMPRACTICAL OR IMPOSSIBLE TO PRESENTLY PREDICT WHAT MONETARY DAMAGES GRANTOR WOULD SUFFER UPON CITY'S FAILURE TO COMPLETE ITS PURCHASE OF THE PROPERTY. CITY DESIRES TO LIMIT THE MONETARY DAMAGES FOR WHICH IT MIGHT BE LIABLE HEREUNDER AND CITY AND GRANTOR DESIRE TO AVOID THE COSTS AND DELAYS THEY WOULD INCUR IF A LAWSUIT WERE COMMENCED TO RECOVER DAMAGES OR OTHERWISE ENFORCE GRANTOR'S RIGHTS. IF FURTHER INSTRUCTIONS ARE REQUIRED BY ESCROW HOLDER TO EFFECTUATE THE TERMS OF THIS PARAGRAPH, CITY AND GRANTOR AGREE TO EXECUTE THE SAME. THE PARTIES ACKNOWLEDGE THIS PROVISION BY PLACING THEIR INITIALS BELOW: GRANTOR CITY 17. No Relocation Assistance. The total compensation to be paid by City for the Property is the Purchase Price, which consideration covers all land and improvements, furniture, fixtures and equipment, loss of business goodwill, and relocation assistance, and is the full and complete acquisition cost of the Property. City shall have no obligation to Grantor under the California Relocation Assistance and Real Property Acquisition statutes and guidelines. Except for any breach of terms or conditions contained in this Agreement, Grantor waives and forever releases City, including its successors, officers, employees, attorneys, agents, representatives and anyone else acting on City's behalf, of and from any and all claims, demands, actions or causes of action, obligations, liabilities, or claims for further compensation, known or unknown, based upon or relating to the facts or allegations and circumstances arising from City's acquisition of the Property. By such release, Grantor expressly waives its rights, if any, under Califomia Civil Code Section 1542 which provides: "A General Release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release which if known by him must have materially affected his settlement with the debtor." 18. Survey. A. City, at Grantor's sole cost and expense, shall be provided an ALTA Survey of the Property prepared by a registered land surveyor licensed by the State of California (i) showing the boundaries thereof and the locations of all easements and/or encroachments on or affecting the Property, if any, and (ii) certifying the exact acreage of the Property to three decimal places, exclusive of any portion thereof used or dedicated for public rights-of-way. In all other respects the Survey shall meet the requirements of any governmental agency having jurisdiction over the Property for preparation of a subdivision map and any requirements of the Title Company necessary to delete the Survey exception from an ALTA policy of title insurance. R:\S P~Roripaugh Ranch SP~newXPURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 15 B. If the Survey (i) shows any encroachments affecting the Property, or (ii) shows any easements that would, in City's sole reasonable opinion, adversely affect City's anticipated use of the Property as recreational open space, then Buyer shall have the right to declare this Agreement null and void, in which event, except as expressly set forth in this Agreement, neither party shall have any further rights, duties or obligations hereunder, and the Deposit shall immediately be returned to City. 19. Notices. All notices and demands shall be given in writing by certified mail, postage prepaid, and retum receipt requested, or by personal delivery. Notices shall be considered given upon the earlier of (a) personal delivery or (b) two (2) business days following deposit in the United States mail, postage prepaid, certified or registered, return receipt requested. A copy of all notices shall be sent to Escrow Holder. Notices shall be addressed as provided below for the respective party; provided that if any party gives notice in writing of a change of name or address, notices to such party shall thereafter be given as demanded in that notice: City: City of Temecula 43200 Business Park Drive Post Office Box 9033 Temecula, Califomia 92589-9033 Attn.: City Manager Phone: (909) 506-5100 Fax: (909) 694-6499 Copy to: Richards, Watson & Gershon 355 South Grand Avenue, 40th Floor Los Angeles, California 90071 Attn.: Peter M. Thorson, City Attorney Phone: (213) 626-8484 Fax: (213) 626-0078 Grantor: Ashby USA, LLC 470 Harrison Street Corona, Califomia 92879 Attention: Justin Ashby Phone: (909) 898-1692 Fax: (909) 898-1260 Butterfield Development Co. Inc. 470 E. Harrison Street Corona, California 92879 Attention: Richard Ashby Phone: (909) 898-1692 Fax: (909) 898-1260 R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 16 Copy to: Pete Ohla 470 E. Harrison Street Corona, California 92879 Phone: (909) 898-1692 Fax: (909) 898-1260 Escrow Holder Phone: Fax: 20. Broker's Commissions. City represents and warrants to Grantor that City has used no broker, agent, finder or other person in connection with the transaction contemplated hereby to whom a brokerage or other commission or fee may be payable. Grantor represents and warrants to City that Grantor has not employed any person or business entity as its broker in connection with the transaction contemplated hereby and has employed no other broker, agent, finder or other person to whom a brokerage or other commission or fee may be payable. Grantor shall be solely responsible for the payment of all commissions or fees payable to any person or business entity. Each party indemnifies and agrees to defend and hold the other harmless from any claims resulting from any breach by the indemnifying party of the warranties, representations and covenants in this Section. 21. Standard Instructions. Each party agrees to execute Escrow Holder's supplemental reasonable standard instructions as may be necessary or proper in order to consummate the transactions contemplated by this Agreement; provided, however, in the event of a conflict between the terms hereof and the terms of such standard instructions, the terms hereof shall control. 22. Time is of the Essence. The parties hereto agree that time is of the essence with respect to each term, condition and covenant hereof. 23. Successors and Assigns. The provisions of this Agreement are expressly binding upon, and shall inure to the benefit of, the parties hereto and their successors in interest and assigns. R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final. DOC 17 24. Entire Agreement. This Agreement, together with all exhibits hereto, integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties or their predecessors in interest with respect to all or any part of the subject matter hereof. 25. Severabilit¥. Invalidation of any of the terms, conditions, covenants, or other provisions contained herein by judgment or court order shall in no way affect any of the other terms, conditions, covenants, or provisions hereof, and the same shall remain in full force and effect. 26. Amendments. Any amendments to this Agreement shall be effective only when duly executed by Grantor and City and deposited with Escrow Holder. 27. Attorneys' Fees. In the event that suit is brought for the enforcement of this Agreement or as the result of any alleged breach thereof, the prevailing party or parties in such suit shall be entitled to recover their reasonable attorneys' fees, costs, and expenses from the losing party or parties, and any judgment or decree rendered in such proceedings shall include an award thereof. 28. No Third Party Beneficiary Rights. This Agreement is entered into for the sole benefit of Grantor and City and no other parties are intended to be direct or incidental beneficiaries of this Agreement and no third party shall have any right in, under or to this Agreement. 29. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of thc State of California. 30. Counterparts. This Agreement may be executed simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. For purposes of this Agreement, facsimile signatures shall be deemed to be original signatures, and shall be followed by the immediate overnight delivery of original signature pages. R:XS P~.oripaugh Ranch SPhnew~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 18 31. Assignment of Agreement. Neither City nor Grantor may assign or transfer their respective rights or obligations under this Agreement without first obtaining the prior written consent of the other, which consent may be granted or withheld in the sole and absolute discretion of the applicable party. IN WITNESS VqHEREOF, the parties have caused this Agreement to be executed as of the date first above written. City: CITY OF TEMECULA, a general law City and a public body, corporate and politic By: Sarne~ Title: Attest: Grantor: ASHBY USA, LLC, a California Limited Liability Company By: ASHBY DEVELOPMENT COMPANY, INC., a California corporation, Managing Member By: Justin K. Ashby, President By: Jeanne Deringer, Secretary BUTTERFIELD DEVELOPMENT COMPANY, INC., a California corporation By:. Ronald E. Beaman, President By: Tracy M. Browne, Secretary APPROVED AS TO FORM: Richards, Watson & Gershon, a professional corporation By: City Attomey R:\S P~Roripaugh Ranch SP~new~PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS Final.DOC 19 EXHIBIT A Legal Description Of The Property THE LAND REFERRED TO HEREIN AS THE "LAND" IS SITUATED IN THE STATE OF CALIFORNIA, COUNTY OF RIVERSIDE, CITY OF TEMECULA, AND IS MORE PARTICULARLY DESCRIBED AS FOLLOWS: 11086-0097\729614 05/07/2003 A-1 85/87/2883 18:51 g09898i693 FIESTA PAGE 83/16 EXHIBIT " A " DEDICATION OF HABITAT AD-161-SHCP That portion of the North one-half of the North one-half of Section 20, Township 7 South. Range 2 West, San Bernardino Meridian, in the City of Temeeula, County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Commencing at the Northeast corner of said Section; thence along thc north line of said Section North 88°37'05'' West, 267.00 feet to the westerly line of the land described in a Deed to the Metropolitan Water District of Southern California recorded January 2, 1968 as Instrument No. 27 of Official Records in the office of the County Recorder of said county and the TRUE POINT OF BEGINNING; thence along said the westerly line South 20°13'05" West, 523.01 feet; thence leaving said westerly line, North 72043'38'' West, 14.42 feet to the beginning of a tangent curve, concave southwesterly and having a radius of 1655.00 feet; thence northwesterly 83.95 feet along said curve through a central angle of 02°54'23"; thence North 75°38'01'' West, 1274.67 feet to the beginning of a tangent curve, concave northeasterly and having a radius of 1545.00 feet; thence Northwesterly 312.72 feet along said curve through a central angle of 11°35'49"; thence North 64°02, 12" West, 200.00 feet to the north line of said Section; thence along said north line, South 88037'05'' East, 1983.53 feet the TRUE POINT OF BEGINNING. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the Property required to perform fuel modification and brush clearance in accordance with applicable government requirements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSo RESERVING, for a period often (10) years, an easement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, over any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. ALSO RESERVING the right to reseed and maintain the Property in accordance with the AD-161-SHCP Management and Maintenance Agreement, Assessment No. 006401 and 006-003, issued by the County of riverside on August 2, 1998. ALSO RESERVING thc right to access the Property for any of the above described purposes. P:L~.L~$HB 0005\Legal De.scriptions~lotaa. doc 85/87/2883 10:51 9098981Gg3 FIESTA PAGE 84/16 Thc above-described parcel of land contains approximately 12.45 acres. That certain real property set forth at Exhibit "A" of this Grant Deed shall be referred to herein as the "Scrvient Tenement''. Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and run with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but sb.all terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. DA VID EVANS AND ASSOCIATES, INC. Cliffo~l ~. Simental, PLS Date L.S. No.5022 Expires: 12-31-05 P:~A¥~SHB 000.~Lega! Descriptions',lotaa.doe 05/07/2003 10:51 9098981693 FIESTA PAGE 05/16 PROPOSED SLOPE AND DRA INA GE FACIL I TIES T, P · £ASE~ENT -- '~ ~/ / /'~.~/, 2~ 7. O0 ' ~:~ ~ . $~'~z'os'~ ~.5~'~~ (. _ ~ ~ ...... ' . · , SECTION 20 ~ ~z~L~PROPOS[O 100' FUEL ~ I ¥ ~ 50' EASEfUl TO ~ PER SEDTJON 20 ~ I ~1' INSr NO. 20~9 REC 5/7/60 ~ IIPER INST. NO. 01-3~19~ ..... ~ . ~ ~ ,~ VICINI~ MAP ~ E~E~NT AR[~ DESCR]BED N~RE[N EISE~NT ARE~ = IZ. 45 ACRE5 EXHIBIT "B"~ ~)~ ,~, ~,,~-- DAVID EVeS /~ ~D ~SOClATES, 05/07/2003 10:51 9098901603 FIESTA PAGE 06/16 EXHIBIT "A" DEDICATION OF HABITAT AD-I.61-SHCP That portion of Sections 20, Township 7 South. Range 2 West, San BernardJno Meridian, in the City of Temecula, County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Beginning at the Northeast corner of said Section 20; thence along the east line of said Section 20, South 0°34'31" West, 587.79 feet; thence South 55026'06'' West, 37.04 feet to a point on curve, concave northerly and having a radius of 2945.00 feet, a radial line of said curve to said point bears South 14°3Y53" West; thence Westerly 139.19 feet along said curve through a central angle of 2042'29"; thence North 72o43'38'' West, 220.43 feet to the easterly line of the land described in a Deed to the Metropolitan Water District of Southern California recorded January 2, 1968 as Instrument No. 27 of Official Records in the office of the County Recorder of said county; thence along said easterly line North 20o13'05'' East, 543.28 feet to the north line of said Section 20; thence along said north line, South 88°37'05'' E&~t, 193.04 feet to the Point of Beginning. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the property required to perform fuel modification and brash clearance in accordance with applicable government requirements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING, for a period of ten (10) years, an easement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, ovewr any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. ALSO RESERVING the right to re-seed and maintain the Property in accordance with the AD- 16 I-SCItP Management and Maintenance Agreement, Assessment No. 006-001 and 006-003, issued by the County of riverside on August 2, 1998~ ALSO RESERVING the right to access the Property for any of the above described purposes. p:kA~ASHB 0005XLegal DescriptionsklotbbSEC20. doc 85/87/2883 10:5i 9898981G93 FIESTA PAGE 87/16 THIS DEDICATION IS SUBJECT TO that ccrtain 50.00 foot wide casement to the Metropolitan Water District of Southern California recorded March 7, 1960 as Instrument No. 20189 of the official records of the County Recorder of Riverside County. THIS DEDICATION IS SUBJECT TO that certain 40.00 foot wide easement to Rancho California Water District recorded June 29, 2001 as Instrument No. 01-300190 of the o£flcial records of the County Recorder of Riverside County. The above-described parcel of land contains approximately 3.80 acres. That certain mai property set forth at Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and mn with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Orantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. DAVID EVANS AND ASSOCIATES, INC. Cliffo~l J(. Simental, BLS Date L.S. No.5022 Expires: 12-31-05 p:Ls3AS HB 0005XLegal Deseriptions\lotbbSEC20.doc 05/07/2003 10:5i 9098981693 FIESTA PAGE 08/16 N P_,DUJ',tTY DF 0! 7'Y OF P.O.B. NE COR SEC 20 (~ N72° 45'38#~V (~ 5aS°37'O5"E (~ 555°26'06"t¢ R=2945.00' L=tJg. 19~ 220.43 ' 193.04 ' 37.04' qO' EASEMENT TO RC~/DIPER INST. NO. 01-$00194 REC 6/29/01 --PROPOEED 100' FUEL MODIFICATION ZONE ~ROPOSED ELOPE AND DRAINAGE FACILITIES EASEMENT EASEMENT PEt~ / INET NO 20189 REC 3/7/60 I EASEMENT TO RC~ID PER INST. NO. 01-~0019# REC 6/£E/0~ ~EC TJ OJV .2o $~P.,TJON 2./ NO7' SPRING5 ROA~ ~ EASEMENT AREA DESCRIBED HEREIN EA5EMENT AREA = 3.80 4CRE5 EXHIBIT "B" DAVID EVANS AND ASSOCIATES, VICINITY MAP DEDICATION OF H_AB'TAT AD 161-SHCP CITY OF' TEMECULA COUNTY OP RIVERSIDE STATE OF C~ 05/07/2003 10:51 g098981Gg3 FIESTA PAGE 09/16 EXHIBIT "A" DEDICATION OF HABITAT AD-161-SHCP That portion of Section 21, Township 7 South. Range 2 West, San Bernardino Meridian, in the County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Beginning at the Northwest corner of said Section 21; thence along the north linc of said Section 21, North 88°29'37" East, 814.77 feet to the beginning of a non-tangent curve, concave westerly and having a radius of 1945.00 feet, a radial line of said curve bears North 64°04'40TM F~ast; thence Southerly 707.82 feet along said curve through a central angle of 20°51'03"; thence South 41o16'45" West, 50.65 feet; thence South 87037'47'' West, 143.29 feet to the beginning of a tangent curve, concave northerly and having a radius of 2945.00 feet: thence Westerly 173.17 feet along said curve through a central angle of 3°22'09"; thence North 0°33'47'' East, 574.36 feet; thence South 88°34'20" West, 660.15 feet to the west line of said Section 21; thence along said west line North 0°34'31" East, 145.09 feet to the Point of Beginning. RESERVING an casement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the Property required to perform fuel modification and brash clearance in accordance with applicable government requ/rements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING, for a period of ten (10) years, an easement for wetland or habitat mitigation purposes, including constrncfion, irrigation, grading, monitoring and maintenance, over any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. p:~A~,ASHB0005~Le gal Descriptions\lotbbSEC21 .doc 85/87/2883 18:51 9098981693 FIESTA PAGE 10/15 ALSO RESERV][NG the right to reseed and maintain the Property in accordance with the AD- 161-SHCP Management and Maintenance Agreement, Assessment No. 006-001 and 006-003, issued by the County of riverside on August 2, 1998. ALSO RESERVING the right to access the Property for any of the above described purposes. THIS DEDICATION IS SUBIECT TO that certain 40.00 foot wide easement to Rancho California Water District recorded January 24, 2002 as Instrument No. 02-042151 of the official records of the County Recorder of Riverside County. The above-described parcel of land contains approximately 6.80 acres. That certain real property set forth at ]Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and mn with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. DAVID EVANS AND ASSOCIATES, INC. Clifford[ X. Simental, pLS L.S. No.5022 Date Expires 12-31-05 P:~A'~ASHB0005'~egal DescriptionsklotbbSEC21 .doc 05/07/2003 10:51 '::jOCj898~ G93 FIESTA PAGE N (~ S87o$7'47~'Y/ 145. Z9' (~) /~=$°22'0.~" R--2945.00' L=175.17' RJ VE~OE i I ~1 TY OF INST NO 20189 NEC $/7/~0 ! ~-40t ~SEWENT ~ NO. 01-3000184 RgC6/29/0~ P.O.B. NW COR SEC 21 40' EASEMENT TO RCWD PER INST. NO. 02-042f51 --REC 1/24/2002 /N88,29'37"E 77' 660.15' 588°54'20#~ I !pROPOSED I00' MODIFICATION PROPOSED SLOPE AND DRAINAGE FACILITIES EASEMENT SPR ( RAD } PROPOSED SLOPE DRAINAGE L I TIES EASEMENT 100' FUEL MODIFICATION ZONE 741'16'45#l'/ 50.65 ' 2] MURRIETA HOT SPRINGSs~.,,~' ~EASEMENT AREA ~E$CRIB£D HEREIN EASEMENT AREA 6.80 ACRES EXHIBIT "B" DAVID EVANS AND ASSOCIATES. VICINITY MAP DEDICATION OF HABITAT AD-161-SHCP CouNTY OF RIVERSIDE STATE OF CN.IFORNIA EXHIBIT "A" DEDICATION OF ['IABITAT AD-161-SHCP That portion of Section 21, Township 7 South. Range 2 West, San Bernardino Meridian, in the County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Commencing at the Northwest corner of said Section 21; thence along the north line of said Section 21, North 88°29'37" East, 958.80 feet to the TRUE POINT OF BEGINNING; thence continuing North 88°29'37" East, 4337.60 feet to the northeast corner of said Section 21; thence along the ea~,t line of said Section, South 0°59' 15" West, 1959.71 feet; thence North 89°26'30" West, 331.31 feet; thence South 60°42'39" West, 96.06 feet; thence North 89°10'21" West, 92.70 feet; thence North 5°40'54" West, 142.81 feet; thence North 37°18'47" East, 85.50 feet; thence North 25°31'18'' East, 112.71 feet; thence North 8°11 '54" East, 112.76 feet; thence North 0°50'32" West, 262.15 feet; thence North 22°54'31" West, 192.56 feet; thence North 40°55'28" West, 372.57 feet; thence North 24°16'06'' West, 163.27 feet; thence North 80°11'52" West, 146.69 feet; thence South 59°53'21" West, 91.23 feet; thence South 31°08'49" West, 146.57 feet; thence South 03°09, 12" West, 69.52 feet; thence South 27°42'32" East, 157.42 feet; thence South 49° 18'18" East, 61.50 feet; thence North 68°29' 19" East, ! 50.04 feet; thence South 41°58'23" East, 153.10 feet; thence South 30° 10' 17" West, 129.03 feet; thence South 46° 17' 16" East, 70.83 feet; thence South 10°59'54'' East, 41.74 feet; thence South 71°33'56" West, 183.58 feet; thence South 55°57'01'' West, 292.00 feet; thence South 45"27'34" West, 97.37 feet; thence South 40050'06'' West. 160.77 feet; thence South 51°06'09" West, 146.91 feet; thence South 61'56'22" West, 264.03 feet; P;L/xX, A.S HB 0005~Legal De~riptions\lotcc.doc 85/87/2863 10:51 9090981693 FIESTA PAGE 13/16 thence Noah 83°50'16" West, 159.06 feet; thence North 90°00'00" West, 283.29 feet; thence South 81026'09'' West, 356.89 feet; thence South 72°09'30" West, 161.36 feet; thence South 57040'46'' West, 87.87 feet; thence South 83~31'23'' West, 386.16 feet; thence North 84°12'29" West, 129.22 feet; thence South 84°27'26" West, 193.91 feet; thence South 63~56'06'' West, l 13.99 feet; thence South 89°41'59" West, 162.15 feet; thence South 74040'27'' West, 84.9 ! feet; thence South 47°54'01'' West, 206.41 feet; thence South 81036' 13" West, 465.73 feet; thence South 71°51 '23" West, 60.57 feet; thence North 64009'59'' West, 11.6.35 feet; thence North 38°15, 19" East, 77.68 feet to the beginning of a tangent curve, concave westerly and having a radius of 1677.00 feet; thence Northerly 1102.66 feet along said curve through a central angle of 37°40'23"; thence tangent to said curve, North 00°34'56,' East, 350.12 feet to the beginning oft tangent cup, e, concave westerly and having a radius of 2077.00 feet; thence Northerly 90 !.25 feet along said curve through a central angle of 24°51'42" to the TRUE POINT OF BEGINNING. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the property required to perform fuel modification and brash clearance in accordance with applicable government requirements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an casement for construction, maintenance and traversal of a Fire Road over that portion of the Property designated by said purposes by any governmental agency with re.qponsibil~ty for the provision of fire service, said area to be delineated upon issuance of said governmental approval. ALSO RESERVING, for a period of ten (10) years, an casement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, over any portion of thc Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. P?~A~ASHB000S~egat Dcscriptions\lotcc.doc 05/07/~003 ~0:5[ ~09~@15~3 FIESTA PAGE 14/16 ALSO RESERVING an easement for grading, realignment and construction of Santa Gertrudis Channel in accordance with approved governmental plans, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING for a period of four (4) years, a temporary easement for rehabilitation and restoration of the airfield over the area shown on the map attached as Exhibit B. ALSO RESERVING the right to access the Property for any of the above described purposes. The above-described parcel of land contains approximately 179.55 acres. That certain real property set forth at Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B' of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and run with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. DAVID EVA.NS AND ASSOCIATES, INC. ~ GL. ~ Cliffor[l ~. Simental, PLS Date L.S. No.5022 Expires: 12-31-05 P:~A~ASHB0005~Legal Dcscriptions\lotcc.doc 85/87/2883 18:51 9898981693 FZESTA PAGE 15/16 s ~ $~3"$5'06~ 113.99' ~ 561'56'Z2"~ 264.03' VICINI~ MAP ~ NO'34'5~"E 350. 12' ~ ~4"5t'42~ R~OTT, O0' L~01.~5' ~ E~EMENT ~EA ~ESCRIBED "E"EmN EXHIBIT "B" ~ DEDICATION OF DAVID EVeS ~UNTY OF ~S~E 5/6/05 05/07/2000 10:5I 90808@1690 FIESTA PAGE i6/i6 N SEC 21 ~ IV88 ' 29 ' 37 "W 4337.60" ~N89'~'30'E 33f,3f' ~NSO';f'52"V f46.69 ~gTf'33'5~V ~3.58' ~$60'42'39'~ 96.06' ~559'5:'Zf~v 9~.Z3' ~555'57'Of"V zg~,o0' ~N89'IO'21~E 9Z. 70' ~S3~'08'49~ 146,57' ~S45'27'34'V ~NO5'40'54~E 142.81' ~SO~'Og'12~F 69.52' ~540'50'06"~ 160.77~ ~N37'fS'4~'E 85.50' ~S27'42'~2'E 157.42' ~551'06'09'~ 146.~I' ~N25'~1'tE~E 112.71' ~549'18'fB'E 61.50' ~S6f'56'22~ 264.03' ~NOO.50'3Z=~ 262.15' ~S41'58'23'E ~55,10' ~NgO'O0'O0'~ 283.29' ~N22'54'31~F 192.56' ~S30'fO'fT'W 129.03' ~$B1'26'09~F 356.89' ~N40'55'28~F 372.57' ~$46'fT'f6=E 70.8~' ~S72,0g'30~F 161.36' ~N24'16'06~ f6E.27' ~5fo'sg'54~E 41.74' ~ EASENENT ~EA ~ESCRIBED HEREIN E~E~ENT ~EA 179,~5 ACRES ~000~ T~ DAVID EVeS ~D ~SOCIATES, ~ S~AT~ OF C~ ~'-~00' EXHIBIT B List of Personal Property on the Property Described in Exhibit A as of Close of Escrow No Items A~¢ Present Confirmation by Grantor: (initial) 11086-0097\729614 05/07/2003 B-1 EXHIBIT C-1 Operating Agreement, Warranty and Entitlement Schedule 401 Permit* 404 Permit* AD 161 Habitat Conservation Plan Volumes 1-3 1603 Permit* Roripaugh Specific Plan Roripaugh Ranch Development Agreement Tentative Maps Grading Plans Roripaugh Ranch EIR Environmental Hazards Studies: Phase I, Phase llI and the update to the prior Phase I and m reports, dated May 7, 2003, and titled Updated Environmental Compliance *copies are attached hereto 11086-0097X729614 05/07/2003 C-lA Winston II. Itlckox Secr~tary for Environmental Protection 633 P0~/09 DEC 13 '~ 13:16 Calit'ornia RegionalsanWatermeg? Reglo.QUality Control Board htcmet Ad&~s: ht~:llwww.~b,m, govl-mqcbgl Gray 9174 S~ Park Co~. Suit~ 100, S~ Di~8o. C~foma 9212~ ~mor Phone (858) 467-2~,~2, F~ (8~8) 571-6972 Action on Request for Clean Water Act Section 40I Water Quality Certification mid Application/Report of Waste Discharge for Discharge of Dredged and/or Fill Materials PROJECT: Rodpaugh Ranch Residential DeVelopment Project (F]ie No. 01C-091) Waste Discha,'g¢ Identification No. 9 00001 C091 AFPLICANT: Ashby USA, LLC Mr. Richard Ashby 470 Harrison Street Corona, CA 92789 ACTION: I. [] O:rler for Standard Certification 2. Ill Order for Technically-conditioned Certification 3. [] Order for Denial of Certification STANDARD CONDITIONS: Thc following tkree standm-d conditions apply to al_! certification actions, except as noted under Condition 3 for denials (Action 3). This certification action is subject to modification or revocation upon administrative or judiciat review, including review and ~tendmcnt pursuant to section 13330 of the California Water Code and section 3867 of Title 23 of the California Code of Regulations (23 CCR). This certification action is not intend~l and shall not be construed to apply to any discharge from any activity involving a hydroelectric facility requiring a Federal Energy Regulatory Commission (FERC) license or an amendment to a FERC license unless the pertinent certification application was filed pursuant to 23 CCR subsection 3855(b) and the application specifically identified that a FERC license or amendment to a k"ERC licm~se for a hydroelectric facility was being sought. The 'validity of any non-denial certification action (Actions 1 and 2) shall be conditioned upon total payment of the full fee requi.m, d under 23 CCR section 3833, unless otherwise stated in writing by the certifying agen~. California Environmental Protection Agency Becyeled Pap*r ADDITIONAL CONDITIONS: 'l The following additional conditions shall appl~} to thts project: ~,shby USA, LLC shall, at all times, fully comply with the engineering plans, specifications and technical reports submitted with this application for Section 401 Water Quality Certification and all subsequent submittals required as part of this certification. Ashby USA, LLC shall co~nply with thc requirements of State Water Resources Control Board Water Quality Order No. 99-08-DWQ, the NPDES General Pemtit for Storm Water Discharges Associated with Construction Activity. This certification is not u'ansferable to any person except after notice to thc Executive Officer , of the San Diego Regional Water Quality Control Board (Rebqonal Board). Ashby USA, LLC shall submit this notice in writing at ten.st 30 days in ac~vance of any proposed transfer. The notice must include a written agu'eemcnt between the existing and new owner containing a specific date for thc transfer of this certification's responsibility artd coverage between the curt'tnt owner and the new owner. This agreement shall include an acknowledgement that the existiug owner is liable for violations up to the transfer date and that the new owner is liable from thc Iransfer date on. In tim cvcnt of any violation or threatened violation of the conditions of this certification, the violation or threatened violation shall be subject to any remedies, penalties, process or s,'mctions as provided for under state law. For purposes of section 401(d) of the Clean Watcr Act, the applicability of any state law authorizing remedies, penalties, process or sanctions for the violation or thrcatcncd violation constitutes a limitafioo necessary to assure compliance with the water quality standards and other pertinent requirements incorporated into this certification. 5. h~ response to a suspected violation of any condition of this certification, tl~e Regional Board may require the holder of any permit or Iicanse subject to this cm~:ification to furnish, under penalty of perjury, any technical or monitoring reports the Regional Board deems appropriate, providcd that thc burden, including costs, of the reports shtdl be a reasonable relationship to the need for the reports and the benefits to bc obtained from the reports. 6. In response to may violation of the con~tions of this certification, the Regional Board may add to or modify the conditions of thi~ certification as appropriate to ensure compliance. Ashby USA, LLC shall notify thc Rcgiunal Board, in writing, of tim start of project lg'ading, the start of mitigation installation, and the.completion of mitiggfion in~talh3.tion.. All notifications' shall'be'subofittkd within 3 da~,i of the start of the aciii~n',' aha shail'rel'ef~ii~e File No. 01C-091. 8. Armorflex will be installed along both sides of Long Valley Wash, outside of jurisdictional waters of the U,S. The existing Iow flow" ~ash will remain in its natural condition, except as detailed in the amended 401 Water Quality Certification application package, dated July 25, --2002. 9. All armorflex areas in Santa Gertrudis Creek and Long Valley Wash shall be hydroseeded with a native seed mix. 10. Ashby USA, LLC shall sub~rdt, within 90 days of thc issuance of this certification, a draft conservation easement or deed restriction that protfibits the removal of native vegetation, including but not limited to, mowing, pmrdng, and spraying, in Santa Germ.~dis Creek and Long Valley Wash on the project site. This does not apply to the removal of exotic vegetation or trash and debriS. Ashby USA, I..LC shall subnfit proof of a completcd conservation casement or deed restriction within one year of thc issuance of tiffs certification. Ashby USA, I..LC shall also provide written verification that Riverside County Flood Control and Water Conservation District 0~,CFCWCD) agrees to the prohibition against mowing and Other vegetation removal acti¥ifies within the channels with thc draft conservation casement or deed restriction. 1 I. As mitigation for impacts to 3.38 acres of waters of the U.S., Ashby USA, I..LC shall create at least 8,2 acres of southern willow scrub and freshwater marsh habitat within the 201-acre preserve ~ca on site. The mitigation area shall be located in an arcs that is currently unvcgctatcd or previously disccd. Existing coastal sage scrub, or other areas of native vegetation, shall not bc cleared or graded as part of tho mitigation area. A final mitigation plan shall be subnfitted to the Regional Board for approval prior to the starl of m~y grading associated with the proposed project. The nfitigatiou plau shall include, but nut bc limited to, cross-sections of the mitigation area, planned hydrology, planting specifications ,'md palette, irrigation re,me if necessary, success criteria, and a maintenance and monitoring program. The monitoring program shall meet the requirements listed in Cond/fiou No. 11. 12. Ashby USA, LLC shall submit a report (including topography maps m~d planting locations) to the Regional Board within 90 days of completion of mitigation site preparation and planting, describing as-built status of the mitigation project. If the site grading and planting are not completed within slx weeks of each other, separate reports will be submitted describing those specific as-built conditions. 13. The construction of the proposed mitigation shall be completed within the same calendar year as impacts to waters of the U.S. occur, or at least no later than 9 months following the close of the calendar year in which impacts first occur.(e.g., if impac~ occur in June 2003, construction of mitigation for all impacts must be completed no later than September 2004). 14. The rmtigation area shall be monitored at least quarterly during the first year following installation, semi-annually during the second and third years, and annually until mitigation h~ been deemed successful. Mitigation momtoring reports shall be sub~nitted annually until the site has been deemed successful. M.~i}itoring reports shall be submitted no later than 30 4UI Ccmllcah.. Fdc Nt~. 0lC 091 ' days following the end of the monitoring period. Monitoring reports shall include, but not be limited to, tile following: , ;'. a. Names, qualifications, and affiliations of the perseus contributing to the report; b. Tables presenting the raw data collected in the field as well as analyses of the physical and biological data; c. Qualitative and quantitative oomp,'u'isons of current mitigation conditions with pre- construction conditions and previous mitigation monitoring results; and d. Photodocumontation from established reference points. 15. Ashby USA, LLC shall subm/t, within 90 days of thc issuance of this certification, a draft conservation easement or deed mst_fiction that prohibits development within, mowing, ad/or other activities tilat would result in permanent or temporary dlsturbancc of the mitigation area. Ashby USA, LLC shall submit proof of a completed conservation easement or deed restriction witifin one year of thc issuance of tiais certification. 16. Ashby USA, LLC shah fully implement the Final Water Quality Ma~tagement Plan (WQMP), dated September 26, 2002. Post.construction best management practices (BMPs) that will be implemented to treat and control urban and storm water runoff from the Roripaugh Ranch development include: four detention basins, grassy swales, fossil filters in 12 storm drains, storm drain inlets designed to reduce flow velocity and trap sediments, and sa'eot sweeping. These BM~Ps will be implemented and maintained as described in the WQNEP. 17. A Hornc Owners Association 0REA) will be established prior to thc issuance of the final occupancy permit for this project. The HCA will be responsible for the maintenance of all drainage facilities and BMPs outside of the public right-of-way. The liMPs, maintenance, and other activities described in tim WQMP shall bc incorporated into thc Covenants, Codes, and Restrictions (CC&Rs) to be adopted by the HCA. Ashby USA, LLC shall sobmit the CC&Rs to the Regional Board within 30 days of adoption. I8. For those drainage facilities wiflfin thc public right-cf.-way that will be ~naintained by the City of Temccula Public Works Department with HCA funding (i,e,, fossil filters), Ashby USA, I_,LC shall submit, prior to occupancy, the maintenmace agreement and a written staiemcnt or signature from the City of Temecula that they have accepted the maintenance responsibility. 19. The HCA will own and ma/ntain the [nsite horse re'ill along the south ;md east boundaries of the site, including a crossing of Long Valley Wash, just west of the eastern site boundary. The HCA will post and maintain signs on both sides of the crossing prohibiting riders from traveling east or west wittfin the channel. The I-leA will remove horse, manBro from tile crossing bi-monthly and from the mst of the trails on a monthly basis. 20..The detention basins shall be vegetated with native grasses (e.g., Distichilia sp.), 21. Prior to the initiation of construction in Waters of the U.S., Ashby USA, LLC shall submit to R ' the egional Board any final requiremeitta the RCFCWCD and/or the City of Temecula has . ' 6~33 P0~/0~ DEC 1~ '0~ 13:18 4(/1 Ccllifi~,,dtuil t'il~: No. UIL~-U~)I ' ' placed on the project, This certification d: 9.cs not allow additional impacts to waters of the U.S. based upon any RCFCWCD requi?ement other than those specifically authorized. Should thc RCFCWCD require additioaa~'i~mpacts to watcrs of thc U,S., Ashby USA, LLC must rcapply for a Section 401 Water Quality Certification. 22. This certification docs not address dewatcring; separate authorization will bc required from the Regional Board for any dewatering impacts. REGIONAL WATER QUALITY CONTROL BOAII.D CONTACT PERSON: Mcgan Fisher California Regional Water Quality Control Board, San Diego Region 9174 Sky Park Court, Suite 100 San Diego, CA 92123 858-268-5363 WATER QUALITY CEI&TII,1CATION: I hereby certify that the proposed discharge from thc Roripaugh Ranch Residential Development Project (File No. 01C-091, WDID No. 9 00001C091) will comply with thc applicable provisiong ti sections 301 ("Effluent Limitations"). 302 ("Water Quality Related Efflucat Limitations"), 303 ("Water Quality Stmldards and Implementation Plmxs"), 306 ("National Standards of Performance"), and 307 ("Toxic and Pretreatmcnt Effluent Standards") of the Cleau Water Act. The proposed project as conditioned is consistent with conditions specified in the Water Quality Control Plan for thc San Diego Basin (9) (Basin Plan) for a waiver of waste dischru'gc requirements. Although the adoption of waste discharge requirements is being waived at this time, we may issue waste discharge rcqu/rcmcnts should new information come to our attention that indicates a water quality problem. Except instffar ms may be modified by any preceding conditions, all certification ac~ons arc contingent on (a) thc discharge being limited mxd all proposed mitigation being completed in strict compliance with thc applicants' project desfifiption md/or on the attached Project Information Sheet, and (b) on compliance with all applicable requirements ol" the Regional Water Quality Cta~']>l Boar¢'~/g/atcr Quality Contt~ol Ptm~ (Basin Plan). Regional Water Quality Control Board · Attachments 1 and 2 633 P07/09 DEC 13 '02 13:18 401 ¢.'crlilivauvn 1~1~ l'4u. OIC 0~1 . Applicant: Applicant Representatives: Project Nme: Project Location: Type of Project: Project Description: Federal Agency/Permit: Other Required Regulatory Approvals: California Environmental Qu:flity Act (CEQA) Compliance: Receiving Water: ATTACHMENT 1 PROJECT ]! ~qFORMATION Ashby USA, LLC Richard Ashby 470 Hanison Street Corona, CA 92'/89 909-898-1692 909-898-1693 (t) Glenn Lttkos Associates, Inc. Darlene Shelley and Martin Rasnick 29 Orchard Lake Forest, CA 92630 949-837-0404 949-837-5834 (0 Rofipaugh Ranch Residential Development Project (File No. 01C-091 WDID No. 9 00001C091) The proposed project is located in thc City of Temecula in Riverside County. The site is bounded by the proposed aligument of Murricta Hot Springs Road to the north, the proposed alignment of Butmffield Stage Road to thc south, Leon Road to tim west, and open space to the east, in the Bachelor Mountain qua&angle. Residential Development Ashby USA, LLC proposes to construct a r~iduntial community consisting of approximately 2,058 single-family residential homes on 804.7 acres. The project also iocludcs 15.4 acres of commercial uses, a 12-acre elementary school site, a 20-acre nfiddle school site, a 5. l-acre neighborhood park, a 1.9.7-acre community park, 9.1 acres of private recreational facilities, 202.7 acres of biological habitat, 56.6 acres of flood control and landscaped slopes, and a 2-acre £~re station. The proposed project has a gross density of 2.56 units/acre and a net residential density of 4.97 units/acre. U.S. Army C, orfli of Engineers/SectiOn 404 Pcrmi.t California Department of Fish and Game Stmarnbcd Alteration Agreement The City of Temecula app?oved the EIR on November 26. 2002. Long Valley Wash and Santa Gertrudis Creek .tOi C~uuh~..mm~ PIle NO. OllJ-o~r ' Impacted Waters of tim United States: D?t:dgc Volume: Related Projects Implemented/to be · Implemented by the Applicant(s): Avoidance/Minimization Measures: Compensatory Mitigation: Best Management Practices: The proposed proj~} will pemnentl7 impact 3,38 acres of waters of the U.S., 0.50 of whicl{ are jurisdictional wet ands Not applicable None Approximately 262 acres of the project will be open space, 201 of wlfich will be preserved habitat as required in the Assessment District 161 sub- Regional Habitat Conservation Plan. Mitigation will Consist of creating 8.2 acres of southern willow scrub and freshwater nmrsh habitat adjacent to Santa Gertrudis Creek, within the 201-acre preserve area. Post-development BMPs to treat urban runoff inclnde water quality swales, fossil filters, and four detention basins. The HOA will post and maintain sigms on both sides of the horse trail crossing of Long Valley Wash oa~d will remove horse manme bi-montlfly from the crossing area and monthly from tbe rest of the trails. v · 6~F, P09/09 DEC iF, ~02 1F':19 A'I'I'ACRMEN~ 2 DISTRIB~, TION LIST Mr. Robert Smith U,S. Army Co~ps of Engineers Los Angeles DistricffRcgulatory Brauch 911 Wilslrkc Blvd. Los Angeles, CA 90017-3401 Ms. Darlene Shelley ,'md Martin R~snick Glcnn Lukos Associates, Inc. 29 Orchard Lake Forest, CA 92630 Iv'ir. Peter Olah Paradigm Eugiaeerh~g Group 427 E. Scvcnteemh Street #261 Costa Mesa, CA 92627 State Water Resources Control Board Division of Water Quality LOS ANGELES DISTRICT U.S. ARMY CORPS OF ENGINEERS DEPARTMENT OF THE ARMY PERMIT Permittees: Ranch Ashby USA, LLC and the Homeowners Association (HOA) for Roripaugh Permit Number. 199915459-RRS Issuing Office: Los Angeles District Note: The term "you" and its derivatives, as used in this permit, means the permittee or any future transferee. The term "this office" refers to the appropriate district or division office of the Corps of Engineers having jurisdiction over the permitted activity or the appropriate official acting under the authority of the commanding officer. You are authorized to perform work in accordance with the terms and conditions specified below. Project Description: The project, Roripaugh Ranch, comprises an 805-acre project with 2,058 single-family residential units, commercial, parks, schools, habitat, flood control, and wetlands mitigation within the City of Temecula (City). The project may impact but not exceed 3.38 acres of waters of the U.S. including 0.5-acres of wetlands. The 169-acre parcel commonly referred to as the "Panhandle" and the remaining 636-acre parcel (the Pan) is under the jurisdiction of the City. The existing zoning allows for up to 502 units on the Panhandle and 1,556 units on the 653-acre Pan parcel. Project includes all construction and operation and maintenance necessary for three years per the special conditions. Project Location: In tributaries and in Santa Gertrudis Creek and Long Valley Wash in Temecula, Riverside County, California Permit Conditions: General Conditions: 1. The time lJnfit for completing the authorized activity ends on March 20, 2006. If you find that you need more time to complete the authorized activity, submit your request for a time extension to this office for consideration at least one month before the above date is reached. 2. You must maintain th~ activity authorized by this permit in good condition and in conformance with the terms and conditions of this permit. You are not relieved of this requirement if you abandon the permitted activity, although you may make a good faith transfer to a third party in compliance with General Condition 4 below. Should you wish to cease to maintain, the authorized activity or should you desire to abandon it without a good faith transfer, you must obtain a modification from this permit from this office, which may requLre restoration of the area. 3. If you discover any previously unknown historic or archeological remains while accomplishing the activity authorized by this permit, you must immediately notify this office of what you have found. We will initiate the Federal and state coordination required to determine if the remains warrant a recovery effort or if the site is eligible for listing in the National Register of Historic Places. 4. If you sell the property associated with this permit, you must obtain the signature of the new owner in the space provided and forward a copy of the permit to this office to validate the transfer of this authorization. 5. A conditioned water quality/waste discharge certification has been issued for your prc~ect, you must comply with the conditions specified in the certification as special conditions to this permit. For your convenience, a copy of the certification is attached if it contains such conditions. 6. You must allow representatives from this office to inspect the authorized activity at any time deemed necessary to ensure that it is being or has been accomplished with the terms and conditions of your permit. Special Conditions: 1. The permittee shall implement and abide by the attached Section 10(a)(1)(B) Incidental Take Permit (#TE030504-0), Habitat Conservation Plan (HCP), and Implementing Agreement (IA), for the Roripaugh Ranch Development Project per the US Fish and Wildlife Service (Service) letter to the Corps dated March 30, 2001 (1-6-00-F-29) for impacts to the Federally-listed as threatened coastal California gnatcatcher and endangered Quino checkerspot butterfly, as prepared by the U.S. Fish and Wildlife Service (USFWS) including: 1) the description of the proposed action including all conservation measures, 2) all special terms and conditions of the incidental take statement, and 3) reasonable and prudent measures. The permittee shall also comply with the applicable 10a permit for the Stephens kangaroo rat. In order to legally take a listed species, you have a separate authorization under the Endangered Species Act (ESA). The enclosed permit contains mandatory terms and conditions to implement the project. Failure to comply with the terms and conditions associated with incidental take of the permit, where a take of the listed species occurs, would constitute an unauthorized take, and it would also constitute non-compliance with your Corps permit. However the USFWS is the appropriate authority to determine compliance with the terms and conditions of its take permit, and with the ESA. For further clarification on this point, you should contact the USFWS. Should the USFWS determine that the conditions of the take permit have been violated, normally the USFWS witl enforce the violation of the ESA, or refer the matter to the Department of Justice. 2. The permittee shall submit final detail mass grading and drainage plans (Plans) for Corps approval prior to the initiation of construction. These Plans shall be approved by the City of Temecula and if the City make changes to the project the Corps and the Regional Board shall be notified prior to initiation of construction. The Corps Regulatory project manager shall review and approve or dis-approve (in writing or verbally) the Plans within 30 days of receipt or the Plans shallbe deemed approved. The Plans shall conform to attached permit drawings. The project shall be constructed in accordance with the Corps approved Plans. 3. The permittee, the grading contractors, and the construction contractors, shall hold a pre- construction conference (Corps and Service shall be invited) that will educate all personnel involved with the project that any activity or deviation outside of the Site Plan shall be grounds for permit suspension and that all special conditions of this permit must be abided by and implemented concurrent and after construction. Any additional acreage impacted outside of the approved Plans shall be mitigated at a 5:1 ratio offsite and the area shall be restored to its original condition. In the event that additional mitigation is required, the type of mitigation shall be determined and approved by the Corps and may include enhancement, restoration, creation, or preservation. If such additional mitigation is required then the permittee shall install the mitigation within 60 days of the Corps approving the additional mitigation. 4. The permittee shall employ all standard Best Management Practices and standard conditions of the Section 401 certification/Waste Discharge Permit Order (401 permit) dated December 11, 2002 hereby incorporated by reference into this permit, to ensure that toxic materials, silt, debris, or excessive erosion do not enter watercourses during project construction and that the Final Water Quality Management Plan (WQMP) is implemented. That the permittees shall construct and maintain basin(s) with constructed wetlands and maintain the basins, filters, and wetlands in perpetuity per the 401 permit and WQMP. The filters shall be maintained by the permittees in perpetuity and the Homeowners Association (HOA) may take over the O&M requirements of the WQMP but both permittees shall be responsible for the O&M in perpetuity. The Permittee, Ashby USA, LLC, is responsible for the WQMP until the permit is signed and transferred to the HOA via the transferee form attached to the permit which shall serve as the co-permittee signed executed permit. 5. That Ashby USA, LLC shall implement the Final Mitigation Plan (HMMP) as prepared by Glenn Lukos Associates dated July 25, 2002, concurrent with construction, for the creation of 6.7 acres of southern willow scrub and 1.5 acres of freshwater marsh wetlands. The plan shall be implemented concurrent with construction and all invasive plants shall be removed prior to completion of the housing project. The mitigation shall be maintained by the permittee for five years or until it reaches its success criteria and is approved by the Corps; afterwards the City shall own and maintain this mitigation site in accordance with the AD161 HCP Implementing Agreement (IA) as a part of the 201-acre AD161 mitigation parcel. The pernffttee shall submit a copy of the deed recordation per the AD16! HCP IA within 30 days of this permit being executed insuring that the mitigation site is dedicated in perpetuity. 6. Prior to initiating construction in waters of the U.S., the permittee shall submit a performance bond to the Corps prior to initiation of construction ($550,000.°°11 to insure that all elements of the WQMP and HMMP of this permit are compiled with including the successful completion of the HMMP and the filters construction (as defined in the 401 permit) and O&M for five years associated with the project. The bonding company must appear on the 3 Department of Treasury Ci~:~ular 570, Companies Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and Acceptable Reinsuring Companies. For a current list of Treasury- authorized companies, write or call the Surety Bond Branch, Financial Management Services, Department of the Treasury, Washington DC 20227; (202) 874-6850. The performance bond shah be conditioned such that if the applicant defaults on the mitigation requirements stated under the special conditions of this permit, the bonding company shah assume all responsibility for the mitigation and special condition requirements of this permit. The performance bond shall be released only upon a determination by the Corps that successful mitigation and special condition compliance has been completed. The permittee may request incremental releases of a portion of the performance bond upon successful completion of portions of the mitigation and monitoring requirements of this permit and annual payments made. The decision to release a portion of the bond shah be at the sole discretion of the Corps based on performance and success of the mitigation sites and achievement of mitigation milestones by the permittee. 7. If another entity wishes to assume responsibility for the mitigation or maintenance measures described in the HMMP, this permit, and/or the 401 permit, that entity must send a letter and new performance bond to the Corps indicating their acceptance of said responsibilities. 8. The permittee shah retain a Corps approved qualified biologist(s) to: 1) oversee aH aspects of grading and construction monitoring and mitigation plan implementation that pertain to biological resource protection and proper avoidance of restricted areas, 2) ensure compliance with the mitigation measures, and 3) implement and monitor the HMMP, WQMP, the USFWS Take Permit, and conditions of this permit. The permittee shah construct a temporary fence around the grading limits prior to initiation of construction to protect preserved and sensitive areas. The Biological Monitor shah ensure that the fence cannot be easily removed and is in the correct location. The permanent fence around the site shall be installed as soon as grading/construction is complete. The Corps shah receive monthly verbal status reports as to contractor compliance with these permit conditions and written annual reports. The permittee shah insure that the biological monitor shall insure that aH sensitive areas are avoided and that invasive plants are removed per the HMMP. 9. The permittee shah implement a contractor education program to ensure that contractors and all construction personnel are fully informed of the biologically sensitive resources associated with the project site and are aware of the terms and conditions of this authorization. A copy of this authorization, with the Special Conditions, shall be included in aH bid packages for the project and will be available at the work site at all times during periods of work and must be presented upon request by any Corps personnel with a reasonable reason for making such a request. 10. The permittee shah ensure that aH vehicle maintenance, staging, storage, and dispensing of fuel occurs in designated upland areas. The permittee shah ensure that these designated upland areas are located in such a manner as to prevent any runoff from entering waters of the U.S. 4 11. Permittee, prior to initiati°n of construction, shall notify the Corps in writing as to which phases/Planning Areas (PAs) shall be developed and which PAs he does not own and plans to sell. Any phases/PAs where conservation easements and/or mitigation is required and the land is not owned by the permittee may require that the Corps modify the Corps permit to allow for the other landowner to be either a co-permittee or a transferee of this permit. Further Information: 1. Congressional Authorities. You have been authorized to undertake the activity described above pursuant to: ( ) Section 10 of the River and Harbor Act of 1899 (33 U.S.C. 403). (X) Section 404 of the Clean Water Act (33 U.S.C. 1344). ( ) Section 103 of the Marine Protection, Research and Sanctuaries Act of 1972 (33 U.S.C. 1413). 2. Limits of this authorization. a. This permit does not obviate the need to obtain other Federal, state, or local authorizations required by law. b. 2his permit does not grant any property rights or exclusive privileges. c. This permit does not authorize any injury to the property or rights of others. d. This permit does not authorize interference with any existing or proposed Federal project. 3. Limits of Federal Liability. In issuing this permit, the Federal Government does not assume any liability for the following: a. Damages to the permitted project or uses thereof as a result of other permitted or un- permitted activities or ~rom natural causes. b. Damages to the permitted project or uses thereof as a result of cttrre~t or future activities undertaken by or on behalf of the United States in the public interest. c. Damages to persons, property, or to other permitted or un-permitted activities or structures caused by the activity authorized by this permit. d. Design or construction deficiencies associated with the permitted work. e. Damage claims associated with any future modification, suspension, or revocation of this permit. 4. Reliance on Applicant's Data. The determination of this office that issuance of this permit is not contrary to the public interest was made in reliance on the information you provided. 5 5. Reevaluation of Permit Decision. This office may reevaluate its decision on this permit at any time the cixcumstances warrant. Circumstances that could require a reevaluation include, but are not limited to, the following: a. You fail to comply with the terms and conditions of this permit. ' b. The information provided by you in support of your permit application proves to have been false, incomplete, or inaccurate (See 4 above). c. Significant new information surfaces which this office did not consider in reaching the original public interest decision. Such a reevaluation may result in a determination that it is appropriate to use the suspension, modification, and revocation procedures contained in 33 CFR 325.7 or enforcement procedures such as those contained in 33 CFR 326.4 and 326.5. The referenced enforcement procedures provide for the issuance of an admirtistrative order requiring you to comply with the terms and conditions of your permit and for the initiation of legal action where appropriate. You will be required to pay for any corrective measure ordered by this office, and if you fail to comply with such dixective, this office may in certain situations (such as those specified in 33 CFR 209.170) accomplish the corrective measures by contract or otherwise and bill you for the cost. 6. Extensions. General condition I establishes a time limit for the completion of the activity authorized by this permit. Unless there are circumstances requiting either a prompt completion of the authorized activity or a reevaluation of the public interest decision, the Corps will normally give you favorable consideration to a request for an extension of this t~rne limit. 6 Your signature below, as permittee, indicates that you accept and agree to comply with the terms and conditions of this permit. ASXB¥-USA~-LLC~ a California limited liability company Ashby Development Company, Inc., a California corporation P'-'~R/~TI'EE Justin K. Ashb~''~ DATE President This permit becomes effective when the Federal offidal, designated to act for the Secretary of the Army, has signed below. Dr. Fari Tabatabai Acting Chief, Reg-atatory Branch When the structures or work authorized by this permit are still in existence at the time the property is transferred, the terms and conditions of this permit will continue to be binding on the new owner(s) of the property. To validate the transfer of this permit and the 'associated liabilities associated with compliance with its terms and conditions, have the transferee sign and date below. TRANSFEREE or HOA DATE 7 STATE OF CALIFORNIA - THE RESOURCES AGENCY Gm}' Davis, Governor DEPARTMENT OF FISH AND GAME http://www.dfg.ca,gov Eastern Sierra-Inland Deserts Region 4775 Bird Farm Road Chino Hills, California 91709 Phone (909) 597-9823 Fax (909) 597-0067 February 3, 2003 Ms. Darlene Shelley Glenn Lukos Assocaites 29 Omhard Lake Forest, CA 92630-8300 Dear Ms. Shelly: Enclosed is a copy of the second revised Streambed Alteration Agreement 6-2001-205 for Butterfleld Development Company. If they agree with the conditions/measures set forth in the agreement, please make a copy, have them sign both copies, and return both to our office for signature, at the above address. Written notice of your intent to commence project activities needs to be provided to the Department at least five days in advance of commencing project activities. The California Fish and Game Code requires that you notify the Department in writing within 14 days of receipt of this Proposal as to its acceptability. If you do not respond within this time period you will lose your right to request binding arbitration. For minor changes we suggest you contact the person responsible for writing your agreement prior to sending the written response. If you have any questions regarding the proposed conditions please contact me at (909) 606- 2404. Thank you for your cooperation in this matter. Scott Dawson Staff Environmental Scientist Habitat Conservation Planning, Region 6 f STATE OF CALIFORNIA - THE RESOURCES AGENCY Gray Davis, Governor DEPARTMENT OF FISH http://www.dfg.ca.gov Eastern Sierra-Inland Deserts Region 4775 Bird Farm Road Chino Hills, California 91709 AND GAME Notification No. 6-2001-205 (Revision 2) February 3, 2003 AGREEMENT REGARDING PROPOSED STREAM OR LAKE ALTERATION THIS AGREEMENT, entered into between the State of California, Department of Fish and Game, hereinafter called the Department, and Richard Ashby representing Butterfield Development Company, address: 470 Harrison Street, Corona, CA 92789, phone: (909) 898- 1692, County of Riverside, State of California, hereinafter called the Operator, is as follows: WHEREAS, pursuant to Section 1603 of California Fish and Game Code, the Operator, on the 27 day of August, 2001, notified the Department that they intend to divert or obstruct the natural flow of, or change the bed, channel, er bank of, or use material from the streambed(s) of the following water(s): Santa Gertrudis Creek and Long Valley Wash, tributary to Murrieta Creek, located within the City of Temecula, bounded by the proposed alignment of Murrieta Hot Springs Road to the north, the proposed alignment of Buttedield Stage Road to the south, Leon Road to the west, and open space within the University of California, Riverside Parcel and Johnson Ranch to the east. Sections 20 and 21, Township 7 South, Range 2 West, USGS Map Bachelor Mountain. WHEREAS, the Department (represented by Scott Dawson) has determined that such operations may substantially adversely affect existing fish and wildlife resources including: those songbirds, raptors, other birds, mammals, reptiles, amphibians, plants, and all other aquatic resources and wildlife in the streambed/lake and associated area affected by the proposed project in this agreement. THEREFORE, the Department hereby proposes measures to protect fish and wildlife resources during the Operator's work. The Operator hereby agrees to accept the following measures/conditions as part of the proposed work. If the Operator's work changes from that stated in the notification specified above, this agreement is no longer valid and a new notification shall be submitted to the Department of Fish and Game. Failure to comply with the~rovisions of this agreement and with other pertinent code sections, including but not limited to Fish and Game Code Sections 5650, 5652, 5937, and 5948, may result in prosecution. Nothing in this agreement authorizes the Operator td trespass on any land or property, nor does it relieve the Operator of responsibility for compliance with applicable federal, state, or local laws or ordinances. A consummated agreement, does not constitute Department of Fish and Game endorsement of the proposed operation, or assure the Department's concurrence with permits required from other agencies. STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21, 2003 This agreement becomes effective on date of Department's signature and terminates on March 1, 2008, for the proposed project only. The Operator may request an extension of the agreement annually for a 12-month period if additional construction time is necessary. The extension shall be requested prior to the termination date of the agreement. This agreement shall remain in effect for that time necessary to satisfy the terms/conditions of this agreement. 1. The following provisions constitute the limit of activities agreed to and resolved by this agreement. The signing of this agreement does not imply that the Operator is precluded from doing other activities at the site. However, activities not specifically agreed to and resolved by this agreement, shall be subject to separate notification pursuant to Fish and Game Code 1600 et seq. Proiect/Site Description 2. The Operator proposes to alter Santa Gertrudis Creek and Long Valley Wash to develop 2,058 residential units on 804.7 acres. Project impacts are 3.38 acres of waters of the State, of which 0.83 acres consists of vegetated riparian habitat. Miti.qation and Monitorinq Plan 3. Specific work areas and mitigation measures are described on/in the plans and documents submitted by the Operator and shall be implemented as proposed, unless directed differently by this agreement. 4. Operator will create 6 acres of southern willow scrub and fresh water marsh habitat within the 8.20-acre mitigation site within Santa Gertrudis Creek. 5. If impacts to DFG jurisdictial areas exceed that authorized in Conditions 3 and 4 of the Agreement, the Operator shall mitigate at a minimum 3:1 replacement-to-impact ratio for the impacts beyond those previously authorized by this Agreement. All mitigation shall be approved by the Depar[ment. 6. The Department recommends that all planting be installed between October 1 and April 30 to minimize the need for irrigation and maximize benefits from the winter rainy season. 7. The Department recommends the use of/~ative plants to the greatest extent feasible in the landscaped areas adjacent and/or near the mitigation/open space areas and within or adjacent to stream channels. The Operator shall not plant, seed or otherwise introduce invasive exotic plant species to the landscaped area~ adjacent and/or near the mitigation/open space areas and within or adjacent to stream channels (minimum 100 foot setback from open space areas and 150 foot setback from stream channels and riparian mitigation sites). Invasive exotic plant species not to be used include those species listed on Lists A & B of the California Exotic Pest Plant Council's list of "Exotic Pest Plants of Greatest Ecological Concern in California as of October 1999." This list includes such species as: pepper trees, pampas grass, fountain grass, ice plant, myoporum, black locust, capeweed, tree of heaven, periwinkle, bush lupine, sweet alyssum, English ivy, French broom, Scotch broom, and Spanish broom. A copy of the complete list can be obtained by contacting the California Exotic Pest Plant Council at 32912 Calle del Tesoro San Juan Capistrano, CA Page 2 of 8 STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21,2003 92675. 8. The mitigation site(s) shall meet all the requirements below. a.) All planting shall have a minimum of 80% survival the first year and 100% survival thereafter and shall attain 80% cover after 3 years and 90% cover after 5 years. If the survival and cover requirements have not been ~net, the Operator is responsible for replacement planting to achieve these requirements. Replacement plants shall be monitored with the same survival and growth requirements for 5 years after planting. b.) The site shall not contain more than 5 percent exotic plant species for the Department to deem the site successful. Exotic removal shall be conducted throughout the 5-year monitoring and maintenance period. ' c.) Irrigation of the mitigation site(s) may only be used to help the plants become established during the first two years following planting. Watering/irrigation of the site(s) shall be discontinued at least two years prior to completion of the monitoring period for the site(s) to be deemed successful by the Department. 9. An annual report shall be submitted to the Department each year for a minimum of 5 years after planting and until the Department deems the mitigation site(s) successful. This report shall include (a) a description of the restoration activities done the previous year (including revegetation and exotic species removal) and when they were conducted; (b) the survival, percent cover, and height of both tree and shrub species planted; the number by species of plants replaced, an overview of the revegetation effort, and the method used to assess these parameters shall also be included; (c) The report shall also include information regarding exotic vegetation removal including the amount removed, the amount removed and treated, frequency and timing of removal and treatment, disposal specifics, and a summary of the general success and failures or failure of the exotic removal plan. The report shall also include wildlife observed at the site during monitoring surveys including sensitive species and/or listed species. Photos from designated photo stations shall be included. 10. The mitigation site, as defined in Conditions 3 and 4 of this Agreement shall be preserved in perpetuity through dedication according to the AD 161 SHCP Implementing Agreement. 11. A security (e.g. an irrevocable letter of credit, pledge savings account, performance bond, or CD) for the amount of all mitigation measures shall be submitted to the Department within 90 days of signing this Agreement and prior to commencing project activities. This amount shall be based on a cost estimate which sh¢l be submitted to the Department for approval within 60 days of signing this Agreement. The security shall be approved by the Department's legal advisors prior to its execution. The legal advisors can be contacted at (916) 654-3821. Proiect Construction 12. In those project areas where nesting birds may occur, the Operator either shall not remove potential nesting ripadan vegetation from March 15 through July 30, or shall survey all potential nesting riparian vegetation within the project site for active bird nests. If an active bird nest is located the nest site shall be flagged or staked a minimum of 5 yards in all directions, and this flagged zone shall not be disturbed until the nest becomes inactive, unless otherwise directed by the Department (ref.: Fish and Game Codes 3503, 3503.5). Page 3 of 8 STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21,2003 13. The removal or disturbance of soil, vegetation and vegetative debris from the streambed or bank shall not exceed the limits approved by the Department, or as described in the submitted .application. 14. Areas of disturbed soils with slopes toward a stream shall be stabilized to reduce erosion potential. Where possible, stabilization shall include the revegetation of stripped or exposed areas with vegetation native to the area. Planting, seeding and mulching is conditionally acceptable. Where suitable vegetation cannot reasonably be expected to become established, non-erodible materials may be used for such stabilization. 15. Vehicles shall not be driven or equipment operated in water covered portions of a stream or lake or in wetted areas, or where wetland vegetation, riparian vegetation, or aquatic organisms may be destroyed, except as otherwise provided for in the agreement and as necessary to complete authorized work. 16. If a stream channel has been altered during project operations, its IoW flow channel shall be returned as nearly as possible to pre-project conditions without creating a possible future streambed or bank erosion problem, or a fiat wide channel or sluice-like area. The disturbed portions of any stream channel within the high water mark .of the stream shall be restored to as near original condition as possible, except as otherwise indicated in the submitted application or as directed by the Department. 17: Fill length, width, and height dimensions shall not exceed those of the original installation or the original naturally occurring topography, contour, and elevation; fill shall be limited to the minimal amount necessary to accomplish the agreed activities; fill construction materials other than on-site alluvium, shall consist of clean uncontaminated soil, silt-free gravel, and/or river rock; except as described in the submitted application or as otherwise specified in this agreement. 18. Vegetation removed from the site shall not be stockpiled in the streambed/creek or on its bank. The sites selected on which to push this material out of the stream should be selected in compliance with the other provisions of this agreement. Where possible, suitable brush piles may be left to provide wildlife habitat. 19. This agreement does not authorize the/~onstruction of any temporary or permanent dam, structure, flow restriction or fill, except as described in the Operator's notification. Any temporary dam, artificial obstruction, or other flow diversion shall be constructed from materials, such as clean gravel or sandbags, which will cause little or no siltation. If necessary, flow diversions shall be done in a manner:that shall prevent pollution, minimize siltation and which shall provide flows to downstream reaches. Flows to downstream reaches shall be provided during all times that the natural flow would have supported aquatic life. · Said flows shall be of sufficient quality and quantity to support existing aquatic life both above and below the diversion. Normal flows shall be restored to the stream immediately upon completion of work at that location. 20. Precautions to minimize turbidity/siltation shall be taken into account during project planning and implementation. This may require that the work site be isolated and/or the Page 4 of 8 STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21, 2003 construction of silt catchment basins, so that silt, or other deleterious materials are not allowed to pass to downstream reaches. The placement of any structure or materials in the stream for this purpose, not included in the original project description, shall be coordinated with the Department. Coordination shall include the negotiation of additional agreement provisions. 21. Upon Department determination that turbidity/siltation levels resulting from project related activities constitute a threat to aquatic life, activities associated with the turbidity/siltation, shall be halted unti! effective Department approved control devices are installed, or abatement procedures are initiated. , 22. Spoil sites shall not be located within a stream/lake, where spoil can be washed back into a stream/lake, or where it will cover aquatic or riparian vegetation. The Operator may remove all human generated debris, such as lawn and farm cuttings, garbage and trash. 23. Structures and associated materials, including debris, not designed to withstand high seasonal flows shall be removed to areas above the high water mark before such flows occur. 24. No equipment maintenance shall be done within or near any stream channel or lake margin where petroleum products or other pollutants from the equipment may enter these areas under any flow. 25. The Operator shall comply with all litter and pollution laws. All contractors, subcontractors and employees shall also obey these laws and it shall be the responsibility of the operator to ensure compliance. 26. The clean-up of all pollution spills shall begin immediately. The Operator shall notify the Department immediately of any spills and shall consult with the Department regarding clean- up procedures and requirements. 27. All debris, bark, slash, sawdust, rubbish, silt, cement or concrete or washings thereof, asphalt, paint or other coating material, oil or other petroleum products, or any other substances resulting from project related activities which could be hazardous to aquatic life or waters of the state, shall be prevented from contaminating the soil and/or entering the waters of the state. None of these materials shall be allowed to enter into or be placed within or where they may enter or be washed by rain~ll or runoff into waters of the state. When operations are completed, any excess materials or debris shall be removed from the work area. No rubbish shall be deposited within 150.feet of the high water mark of any stream or lake. 28. All provisions of this agreement remain in force throughout the term of the agreement. Any provisions of the agreement may be amended or the agreement may be terminated at any time provided such amendment and/or termination is agreed to in writing by both parties. Mutually approved amendments become part of the original agreement and are subject to all previously negotiated provisions. Page 5 of 8 STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21, 2003 29. If the Operator or any of the individuals mentioned above violate any of the terms or conditions of this agreement, all work shall terminate immediately and shall not proceed until the Department has taken all of its legal actions. 30. The Department reserves the right to enter the project site at any time to ensure compliance with terms/conditions of this agreement. 31. The Operator shall provide a copy of this agreement to all contractors, subcontractors, and the Operator's project supervisors. Copies of the agreement shall be readily available at work sites at all times during periods of active work and must be presented to any Department personnel, or personnel from another agency upon demand. 32. The Operator shall notify the Department, in writing, at least five (5) days prior to initiation of construction (project) activities and at least five (5) days prior to completion of construction (project) activities. Notification shall be sent to the Department at 330 Golden Shore, Suite 210, Attn: Streambed Team. Please reference SAA # 6-2001-205. Extension of Aqreement 33. The Operator shall request an extension of this agreement prior to its termination. Extensions may be granted for up to 12 months from the date of termination of the agreement and are subject to Departmental approval. The extension request and fees shall be submitted to the Department's Region 6 Office at the above address. If the Operator fails to request the extension prior to the agreement's termination then the Operator shall submit a new notification with fees and required information to the Department. Any activities conducted under an expired agreement are a violation of Fish and Game Code Section 1600 et. seq. Suspension of Permit 34. The Department reserves the right to suspend or cancel this Agreement, after giving notice to the Operator, if the Department determines that the Operator has breached any of the terms or conditions of this Agreement, or for other reasons, including but not limited to the following: ~, a. The Department determines that the information provided by the Operator in support of the Notification/Agreement is incomplete or inaccurate; b. The Department obtains new information that .was not known to it in preparing the terms and conditions of the Agreement; c. The project or project activities as described in the Notification/Agreement have changed; d. The conditions affecting fish and wildlife resources change or the Department determines that project activities will result in a substantial adverse effect on the environment. Page 6 of 8 STREAMBED ALTERATION AGREEMENT FOR NOTIFICATION NUMBER: 6-2001-205 January 21,2003 Concurrence (6-2001-205) In WITNESS WHEREOF, the parties below have executed this Lake or Streambed Alteration Agreement Number 6-2001-205 as indicated below: Date Richard Ashby ' Butterfield Development Co. Date Prepared by: Scott Dawson Staff Environmental Specialist Department of Fish and Game Date Curt Taucher Region 6 Manager Department of Fish and Game Page 7 of 8 EXHIBIT C-2 Obligations Accepted by City Except as follows, Exhibit C-2 is intentionally left blank: The City of Temecula, expressly and without exception, accepts no duty, liability, performance obligation or obligation to expend any monies for obligations arising from, directly or indirectly, under the 401 Permit, the 404 Permit, the 1603 Permit and the Assessment District 161 Multi Species Habitat Conservation Plan ("Plan"). 11086-0097\729614 05/08/2003 C-2-1 EXHIBIT C-3 11086-0097\729614 05/07/2003 C-3-1 RORIPAUGH RANCH OPEN SPACE PURCHASE AND SALES AGREEMENT MATRIX Task Include Prior to Prior to on the Recordation Issuance of Deed of the Deed Grading Permit for the Roripaugh Ranch Specific Plan project City shall grant Ashby reservations for the purpose of X improvements shown on the deed over the necessary portions of the property for grading, construction, and maintenance purposes. Ashby shall obtain approval of California Fish and Game X Department, US Fish and Wildlife Service, Army Corp of Engineers, and San Diego Water Quality Board, as required by these agencies, prior to the transfer of the 201-acre habitat property to the City. Ashby shall submit to the City a Final Biologist Monitoring X Report approved by the US Fish and Wildlife Service, prepared and certified by a biologist to: 1. Ensure that toxic species remain at baseline, 2. Ensure that the property has not been degraded by off- road vehicles, 3. Ensure that no illegal dumping has taken place. If the biologist determines these conditions exist, Ashby is obligated to take corrective actions prior to the recordation of the deed. Ashby shall provide an update to the SID Geotechnical X Environmental Compliance Report dated February 25, 2002 prepared by qualified engineer to ensure that the conditions described in the said SlD report are still current. Ashby shall pay CNLM a total of $439,298.00 that includes X $3,200 for funding the interim management of the property and $436,098.00 for funding the long-term maintenance of the property. Ashby shall provide the City assurance that a $99,600 bond X has been secured with CNLM to ensure the construction of the Interim Fence and the Temporary Fence. CNLM will release the bond when Ashby constructs the permanent fencing per the requirements of the Specific Plan. City to record the conservation deed restriction to preserve the X area as habitat open space pursuant to AD 161 Agreement immediately after the recordation of the deed. Ashby is responsible for installation and maintenance of X minimum 4' high Interim Fence ("snow fence") for the purpose of controlling access and preserving the habitat areas prior to and during the grading process. Ashby shall perform all conditions required in regards to the fencing. R:~S P~Roripaugh Ranch SPXnew\OS Purchase and Sales Agreement CC 5-13-03.doc 8 Task Include Prior to Prior to on the Recordation Issuance of Deed of the Deed Grading Permit for the Roripaugh Ranch Specific Plan project Ashby shall notify the Service 10 days prior to habitat X disturbance. Ashby shall submit to the City a copy of the Habitat X Management Plan approved by the US Fish and Wildlife Service. Ashby is responsible to install and maintain a 6' high temporary N/A N/A N/A chain link fence within 10 days from the establishment of the fina~ grades in accordance with the rough grading plans along the boundary of the property. Ashby shall remove this fencing only when Ashby installs the permanent fencing. The City shall provide a copy of the deed restriction to the N/A N/A N/A Service within 30 days of recordation. Ashby shall prepare and obtain approval of the City of N/A N/A N/A Temecula Fire Department and all resource agencies including the Fish and Wildlife Service for a Fire Management Plan and submit it to the City within 60 days after the initiation of the ground disturbance unless waived by the City's Fire Marshall. Ashby is required to comply with Mitigation Monitoring Program N/A N/A N/A of the FEIR for the Roripaugh Ranch Specific Plan including all related permits. Ashby is responsible for constructing, maintaining, and N/A N/A N/A monitoring the wetlands within City's property until such time the resource agencies have accepted the mitigation area as complete. Ashby shall be responsible for providing funding for the N/A N/A N/A maintenance of Santa Gertrudis Creek within City's property until the responsibility is transferred to the Roripaugh Ranch's Master Home Owner's Association. Ashby shall perform its grading and construction operations in N/A N/A N/A accordance with the provisions of the AD 161, and the 401, 404, and 1603 permits. Ashby is responsible to pay for the maintenance of all fuel N/A N/A N/A modification zones within the City's property until such time that another entity, approved by the City, initiates their payments for this maintenance. R:~S PXRoripaugh Ranch SP~new~OS Purchase and Sales Agreement CC 5-13-03.doc 9 EXHIBIT D Form Of Grant Deed RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: CITY OF TEMECULA 43200 Business Park Drive, P.O. Box 9033 Temecula, California 92589-9033 Attention: City Clerk [SPACE ABOVE FOR RECORDER'S USE ONLY] GRANT DEED THE UNDERSIGNED GRANTOR DECLARES AS FOLLOWS: This transfer is exempt from documentary Transfer Tax pursuant to Revenue & Taxation Code Section 11922. FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledge , a ("Grantor") hereby grants to CITY OF TEMECULA, a public body, corporate and politic, certain mai property located in the City of Temecula, County of Riverside, State of California, more particularly described on "Exhibit A" attached hereto and incorporated herein by reference. SUBJECT TO: A. General and special real property taxes and assessments and supplemental assessments for the current fiscal year; and B. All matters of record. IN WITNESS WHEREOF, Grantor has executed this Grant Deed as of the date set forth below. Dated: By: Name~ Title: 11086-0097~729614 05/07/2003 D-1 STATE OF CALIFORNIA ) ) SS. COUNTY OF RIVERSIDE ) On the day of _, 2003, before me, , personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity and that by his signature on the instrument the person or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. Notary Public SEAL: 11086-0097\729614 05/07/2003 D-2 EXHIBIT A To Form of Grant Deed 11086-0097\729614 05/07/2003 D-1 EXHIBIT E Bill of Sale For good and valuable consideration, the receipt of which is hereby acknowledged, , a ("Grantor"), does hereby sell, transfer and convey to ("City"), without recourse or warranty, any and all personal property (the "Personal Property") owned by Grantor and used exclusiv61y in connection with the operation of that certain real property commonly known , Temecula, California, and more particularly described in Exhibit A attached hereto (the "Property"). this IN WITNESSWHEREOF, Grantor and Cityhave executed this Bill ofSale as of day of ., 2003. GRANTOR: By: Name: Title: CITY: By: Name: Title: 11086-0097\729614 05/07/2003 E-1 EXHIBIT F Right Of Entry And Access Agreement THIS RIGHT OF ENTRY AND ACCESS AGREEMENT (herein called this "Agreement") is made and entered into as of ___, 2003, by ASHBY USA, LLC, a California Limited Liability Company (herein called "Grantor"), and CITY OF TEMECULA, a general law City and a public body, corporate and politic (herein called "City"). WITNESSETH: WHEREAS, Grantor is the owner of the real property more particularly described on Exhibit A, attached hereto and incorporated herein by reference (herein called the "Property"); WHEREAS, concurrently with the execution of this Agreement, Grantor and City contemplate entering into a Purchase and Sale Agreement and Escrow Instructions related to the Property (the "Purchase Agreement"); WHEREAS, City has requested the right of entry upon and access to the Property for the purpose of undertaking tests, inspections and other due diligence activities (herein called the "Due Diligence Activities") in connection with the proposed acquisition by City of the Property; WHEREAS, Grantor has agreed to grant to City, and City has agreed to accept from Grantor, a non-exclusive, revocable license to enter upon the Property to perform the Due Diligence Activities in accordance with the terms and provisions of this Agreement; WHEREAS, Grantor and City desire to execute and enter into this Agreement for the purpose of setting forth their agreement with respect to the Due Diligence Activities and City's entry upon the Property. NOW, THEREFORE, for and in consideration of the foregoing premises, the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Grantor and City do hereby covenant and agree as follows: 1. Access by City. Prior to Entry City shall Demonstrate Insurance Coverage. A. Subject to City's compliance with the terms and provisions of this Agreement, until the earlier to occur of (i) _, 2003; or (ii) the earlier termination of this Agreement, City and City's agents, employees, contractors, representatives and other designees (herein collectively called "City's Designees") shall have the right to enter upon the Property for the purpose of conducting the Due Diligence Activities. B. City expressly agrees as follows: (i) any activities by or on behalf of City, including, without limitation, the entry by City or City's Designees onto the Property in connection with the Due Diligence Activities shall not damage the Property in any manner whatsoever or disturb or interfere with the rights or possession of any tenant on the Property, (ii) 11086-0097\729614 05/07/2003 F-1 in the event the Property is altered or disturbed in any manner in connection with the Due Diligence Activities, City shall immediately return the Property to the condition existing prior to the Due Diligence Activities, and (iii) City, to the extent allowed by law, shall indemnify, defend and hold Grantor harmless from and against any and all claims, liabilities, damages, losses, costs and expenses of any kind or nature whatsoever (including, without limitation, attorneys' fees and expenses and court costs) suffered, incurred or sustained by Grantor as a result of, by reason of, or in connection with the Due Diligence Activities or the entry by City or City's Designees onto the Property. Notwithstanding any provision of this Agreement to the contrary, City shall not have the right to undertake any invasive activities or tests upon the Property, or any environmental testing on the Property beyond the scope of a standard "Phase I" investigation, without the prior written consent of Grantor of a workplan for such "Phase 1I" or invasive testing. If Grantor does not respond or reject any workplan within five (5) days of City's delivery of the written workplan proposal to Grantor pursuant to the notice provisions of this Agreement, then Grantor shall be deemed to have approved the submitted workplan and City may proceed with such testing. If Grantor rejects such proposed workplan in whole or in part, then this Agreement shall become null and void at the sole option of City, which option must be exercised by City's giving Grantor written notice on or before __., 2003 (being the same date as the end of the Due Diligence Period under the Purchase Agreement). If City terminates this Agreement under the foregoing provision, then neither party shall have any further rights, duties and obligations hereunder, except City shall be entitled to a refund of the Deposit under the Purchase Agreement. 2. Lien Waivers. Upon receipt of a written request from Grantor, City will provide Grantor with lien waivers following completion of the Due Diligence Activities from each and every contractor, materialman, engineer, architect and surveyor who might have lien rights, in form and substance reasonably satisfactory to Grantor and its counsel. To the extent permitted by applicable law, City hereby indemnifies Grantor from and against any claims or demands for payment, or any liens or lien claims made against Grantor or the Property as a result of the Due Diligence Activities. 3. Successors. To the extent any rights or obligations under this Agreement remain in effect, this Agreement shall be binding upon and enforceable against, and shall inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and permitted assigns. 4. Limitations. Grantor does not hereby convey to City any right, title or interest in or to the Property, but merely grants the specific rights and privileges hereinabove set forth. 5. Notices. Whenever any notice, demand, or request is required or permitted under this Agreement, such notice, demand, or request shall be in writing and shall be delivered by hand, be sent by registered or certified mail, postage prepaid, return receipt requested, or shall be sent by nationally recognized commercial courier for next business day delivery, to the addresses set forth below the respective executions of the parties hereof, or to such other addresses as are specified by written notice given in accordance herewith, or shall be transmitted by facsimile to the number for each party set forth below their respective executions hereof, or to such other numbers as are specified by written notice given in accordance herewith. All notices, demands, 11086-0097\729614 05/07/2003 F-2 or requests delivered by hand shall be deemed given upon the date so delivered; those given by mailing as hereinabove provided shall be deemed given on the date of deposit in the United States Mail; those given by commercial courier as hereinabove provided shall be deemed given on the date of deposit with the commercial comer; and those given by facsimile shall be deemed given on the date of facsimile transmittal. Nonetheless, the time period, if any, in which a response to any notice, demand, or request must be given shall commence to run from the date of receipt of the notice, demand, or request by the addressee thereof. Any notice, demand, or request not received because of changed address or facsimile number of which no notice was given as hereinabove provided or because of refusal to accept delivery shall be deemed received by the party to whom addressed on the date of hand delivery, on the date of facsimile transmittal, on the first calendar day after deposit with commemial courier, or on the third calendar day following deposit in the United States Mail, as the case may be. 6. Assignment. This Agreement may be assigned by City, in whole or in part. 7. Goveming Law. This Agreement shall be construed, enforced and interpreted in accordance with the laws of the State of California. 8. Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original, and all of such counterparts together shall constitute one and the same instrument. 9. No Recording of Agreement or Memorandum of Agreement. In no event shall this Agreement or any memorandum hereof be recorded in the Official Records of Los Angeles County, California, and any such recordation or attempted recordation shall constitute a breach of this Agreement by the party responsible for such recordation or attempted recordation. IN WITNESS WHEREOF, Grantor and City have caused this Agreement to be executed and sealed, all the day and year first written above. GRANTOR: Name; Title: Date Executed: Address for notices: Telephone No.: Facsimile No.: With a copy to: Telephone No.: Facsimile No.: CITY: CITY OF TEMECULA 11086-0097\729614 05/07/2003 F-3 A general law City and a public body, corporate and politic By: Name: Title: Date Executed: Address for notices: With a copy to: City of Temecula 43200 Business Park Drive Post Office Box 9033 Temecula, California 92589-9033 Attention: Telephone No.: (909) Facsimile No.: (909) Richards, Watson & Gershon 355 South Grand Avenue, 40th Floor Los Angeles, California 90071 Attn.: Peter M. Thorson, Esq. Telephone No.: (213) 626-8484 Facsimile No: (213) 626-0078 11086-0097\729614 05/07/2003 F-4 EXHIBIT A To Right of Entry and Access Agreement Legal Description of Property 11086-0097\729614 05/07/2003 F-5 05/07/2003 10:51 9098981693 FIESTA PAGE 83/16 EXHIBIT"A" DEDICATION OF HABITAT AD-161-SHCP That portion of the North one-half of the North one-half of Section 20, Township 7 South. Range 2 West, San Bcmardino Meridian, in the City of Temecula, County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described a.s follows: Commencing at the Northeast comer of said Section; thence along the north linc of said Section North 88°37'05" West, 267.00 feet to the westerly line of the land described in a Deed to the Metropolitan Water District of Southern California recorded January 2, 1968 as Instmment No. 27 of Official Records in the office of the County Recorder of said county and the TRUE POINT OF BEGINNING; thence along said the westerly line South 20013'05'' West, 523.01 feet; thence leaving said westerly line, North 72°43'38" West, 14.42 feet to thc beginning of a tangent curve, concave southwesterly and having a radius of 1655.00 feet; thence northwesterly 83.95 feet along said curve through a central angle of 02°54'23"; thence North 75°38'01" West, 1274.67 feet to the beginning of a tangent curve, concave northeasterly and having a radius of 1545.00 feet; thence Northwesterly 312.72 feet along said curve flarough a central angle of 11°35'49"; thence North 64*02' 12" West, 200.00 feet to the north line of said Section; thence along said north line, South 88*37'05" East, 1983.53 feet the TRUE POINT OF BEGINNING. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the Property required to perform fuel modification and brush clearance in accordance with applicable government requirements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING, for a period often (10) years, an easement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, over any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said govemmem approval. ALSO RESERVING the right to reseed and maintain the Property in accordance with the AD-161-SHCP Management and Maintenance Agreement, Assessment No. 006-001 and 006-003, issued by the County of rivei~ide on August 2, 1998. ALSO RESERVING the right to access the Property for any of the above described purposes. P:~A\ASHB0005\Legal Descriptio ns\lotaa, doc 85/87/2883 10:51 9098981693 FIESTA PAGE 84/16 The above-described parcel of land contains approximately 12.45 acres. That certain real property set forth at Exhibit "A" of this Crrant Deed shall be referred to herein as the "Scrvient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and mn with the Dominant Tenement and the Servient Tenement. Each of the casements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. DAVID EVANS AND ASSOCIATES, INC. o- Cliffo~t ~. $imental, PLS Date L.S. No.5022 Expires: ] 2-31-05 pAA~ASHB0005~Legal Descripfions\lotaa.doc 05/07/2003 10:51 90989@1693 FIESTA PAGE 05/16 Ill PROPOSED SLOPE AND . ORAfN,46E FACfL IT/ES T.P. 0. B. N88'~7'05 ~'~/ -,~ EASEMENT ~ ' -~ / . . ./Z_ .... , NE CORNE~ ~EOTIDN 20 ~EASE~NT AREA DESCRIBED HEREIN EASE~NT AREA = ~.45 ACRE5 EXHIBIT "B" DAVID EVeS ~D ~SOClATES, ~ 85/87/2883 ~0:51 909898~693 FIESTA PAGE 86/16 EXHIBIT "A" DEDICATION OF HABITAT AD-161-SHCP That portion of Sections 20, Township 7 South. Range 2 West, San Bemardino Meridian, in the City of Temecula, County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Beginning at the Northeast comer of said Section 20; thence along the east line of said Section 20, South 0e34'31" West, 587.79 feet; thence South 55°26'06'' West, 37.04 feet to a point on curve, concave northerly and having a radius of 2945.00 feet, a radial line of said curve to said point bears South 14°33'53" West; thence Westerly 139.19 feet along said curve th.rough a central angle of 2°42'29"; thence North 72°43'38'' West, 220.43 feet to the easterly line of the land described in a Deed to the Metropolitan Water District of Southern California recorded January 2, 1968 as Instrument No. 27 of Official Records in the office of the County Recorder of said county; thcnce along said easterly line North 20°13'05'' East, 543.28 feet to the north line of said Section 20; thence along said north line, South 88*37'05" East, 1.93.04 feet to the Point of Beginning. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the property required to perform fuel modification and brush clearance in accordance with applicable government requirements, said area to be delineated upon recordation of thc final map for subdivision of adjacent property. ALSO RESERVING, for a period of ten (10) years, an easement for wetland or habitat rmtigation purposes, including construction, irrigation, grading, monitoring and maintenance, ovewr any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. ALSO RESERVING the right to re-seed and maintain the Property in accordance with the AD~ 16 I-SCHP Management and Maintenance Agreement, Assessment No. 006-001 and 006-003, issued by the County of riverside on August 2, 1998. ALSO RESERVING the right to access the Properly for any of the above described purposes. P:~AX.&SHB 0005kLegal Dcscription~klotbbSEC20.d o¢ 05/07/2003 [0:5[ 909898[693 FIESTA PAGE 07/16 THIS DEDICATION IS SUBJECT TO that certain 50.00 foot wide easement to the Metropolitan Water District of Southern California recorded March 7, 1960 as Instrument No. 20189 of the official records of the County Recorder of Riverside County. THIS DEDICATION IS SUBJECT TO that certain 40.00 foot wide easement to Rancho California Water District recorded June 29, 2001 as Instrument No. 01-300190 of the official records of the County Recorder of Riverside County. The above-described parcel of land contains approximately 3.80 acres. That certain real property set forth at Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and mn with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual., but shall terminate when Grantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. Cl~ffo~l ,~.. Simental, PISDate L.S. No.5022 Expires: 12-31-05 p:kALCSHB0005',Legal Description$\l otbb$1gC20.d oc RECEZVED: 5/ 7/03 10:16AM; ->CZTY OF TEMECULA; #595; PAGE 8 05/07/2003 18:51 9098981693 FIESTA PAGE 08/16 N cOUNTY OF TEMEOUL~ P.D.B. NE COR SEC 20 R=2945.00' 220.45' 193.04' 37.04' 40' EASEMENT TO RC~iDIPER INST. NO. 01-500194 REC 6/29/01 PROPOS£D 100' FUEL MODIFICATION ZONE SLOP£ AND FA C IL I TIES EASEMENT L=139.19' (RAD) EASEMENT PEG mST NO 20189 R£C 3/7/60 EASEMENT Re,lO PER INST. NO. 01-$00194 REC o_DTJOJ\J 20 rErA HOT SPRING5 RoAD FT~-~EASEMENT AREA DESCRIBED HEREIN EA5EMENT AREA = $.80 ACRES VICINITY MAP EXHIBIT "B" OF DAVID EVANS AND ASSOCIATES, AD-161-SHCP 05/0?/2003 1~:5i 9098981693 FIESTA PAGE 09/15 EXHIBIT "A" DEDICATION OF HAI~ITAT AD-161-SHCP That portion of Section 21, Township 7 South. Range 2 West, San Bemardino Meridian, in the County of Riverside, State of California, according to thc Official Plat of said Land filed in the District Land Office, described as follows: Beginning at the Northwest comer of said Section 21; thence along the north linc of said Section 21, North 88°29'37'' East, 814.77 feet to the beginning of a non-tangent curve, concave westerly and having a radius of 194-5.00 feet, a radial line of said curve bears North 64°04'40" East; thence Southerly 707.82 feet along said curve through a central angle of 20°51'03"; thence South 41016'45" West, 50.65 feet; thence South 87037'47" West. 143.29 feet to the beginning of a tangent curve, concave northerly and having a radius of 2945.00 feet: thence Westerly 173.17 feet along said curve through a central angle of 3°22'09"; thence North 0033'47" East, 574.36 feet; thence South 88034'20" West, 660.15 feet to the west line of said Section 21; thence along said west line North 0°34'31 '? East, 145.09 feet to the Point of Beginning. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the Property required to perform fuel modification and brush clearance in accordance with applicable government requirements, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING, for a period of ten (10) years, an easement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, over any portion of the Property approved for such purposes by ,any government entity, said area to be delineated upon issuance of said government approval. p:L,~AA S HB 0005'tL e g a! Descriptio ns\lotbbSEC21 .doc 05/0?/2003 ~8:5~ 909898~693 FZE~TA PAGE 10/16 ALSO RESERVING the right to reseed and maintain the Property in accordance with the AD- 161-SHCP Management and Maintenance Agreement, Assessment No. 006-001 and 006-003, issued by the County of riverside on August 2, 1998. ALSO RESERVING the right to access the Property for any of the above described purposes. THIS DEDICATION IS SUBIECT TO that certain 40.00 foot wide easement to Rancho California Water District recorded January 24, 2002 as [nstmmem No. 02-042151 of the official records of the County Recorder of Riverside County. The above-described parcel of land contains approximately 6.80 acres. That certain real property set £onh at Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dormnaat Tenement"), and shall be binding upon and mn with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servient Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Cn'antor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terminate. Cliffor~t ~. Simental, pLS Date L.S. No.5022 Expires: 12-31-05 P:~ASHB0005~Legal DescriptionsXlotbbSEC21 .doc 85/87/2883 tO:SZ 909898Z693 FZESTA PAGE 11/16 ~ (~ S87'$7'47"'t¢ 145.29' ,[ (~ A=$'22'09" R=2945.00' L=175.17' / SEC 21/ 40' EASEMENT TO ....... ~ ..... ~ ~ ~ ~ PROPOSED SLOPE ~ ~ ~ND DRAINACE ~ FACIL. ..... N ZONE ~1 ~ ;~ EASE~NT PERI RC~ PER INST. REC 6/29/0f ~ EASE.ENT ~EA BESCRIBEB HEREIN E~EMENT ~EA - 6.80 ACRES VICINI~ MAP EXHIBIT ,,B,, DEDICATION OF ~, ~ H~ITAT AD-161-SHCP DAVID EVeS ~ ~*~' ~D ~SOClATES, ~ STATE ~ C~OR~A 85/87/2882 ~0:5~ 909898Z692 FIEgTA P~GE ~2/Z6 DEDICATION OF HABITAT AD-161-SHCP That portion of Section 21, Township 7 South. Range 2 West, San Bemardino Meridian, in the County of Riverside, State of California, according to the Official Plat of said Land filed in the District Land Office, described as follows: Commencing at the Northwest comex of said Section 21; thence along the north line of said Section 21, North $8°29'37" East, 958.80 feet to the TRUE POINT OF BEGINNING; thence continuing North 88029'37'' East, 4337.60 feet to the northeast comer of said Section 21; thence a.long the east line of said Section, South 0°59, 15" West, 1959.71 feet; thence North 89026' 30" West, 331.31 feet; thence South 60°42'39'' West, 96.06 feet; thence North 89° 10'2 I" West, 92.70 feet; thence North 5°40'54" West, 142.81 feet; thence North 37° 18'47" East, 85.50 feet; thence North 25°31' 1 $" East, 112.71 feet; thence North 8° I 1 '54" East, 112.76 feet; thence North 0°50'32'' West, 262.15 feet; thence North 22°54'31" West, 192.56 feet; thence North 40°55'28'' West, 372.57 feet; thence North 24016'06'' West, 163.27 feet; thence North 80°11'52" West, 146.69 feet; thence South 59°53'21'' West, 91.23 feet; thence South 31°08'49'' West, 146.57 feet; thence South 03°09' 12" West, 69.52 feet; thence South 27°42'32" East, 157.42 feet; thence South 49°I 8'18" East, 61.50 feet; thence No~h 68029, 19" East, 150.04 feet; thence South 41°58'23'' East, 153. l0 feet; thence South 30°10' 17" West, 129.03 feet; thence South 46° 17' 16" East, 70.83 feet: thence South 10°59'54" East, 41.74 feet; thence South 71033'56'' West, 183.58 feet; thence South 55°57'01" West, 292.00 feet; thence South 45°27'34" West, 97.37 feet; thence South 40°50'06'' West, 160.77 feet; thence South 51°06'09" West, 146.91 feet; thence South 61°56'22" West, 264.03 feet; P:~L~.SHB0005~Legal Descrlptions\lotcc.do¢ 05/07/2003 10:51 S098981693 FIESTA PAGE 13/16 thence North 83°50' 16" West, 159.06 feet; thence North 90°00'00" West, 283.29 feet; thence South 81°26'09'' West, 356.89 feet; thence South 72o09'30" West, 161.36 feet; thence South 57°40'46" West, 87.87 feet; thence South 83'31'23" West, 386.16 feet; thence North 84o12'29" West. 129.22 feet; thence South 84°27'26" West, 193.91 feet; thence South 63°56'06'' West, 113.99 feet; thence South 89°41'59" West, 162.15 feet; thence South 74040' 27" West, 84.91 feet; thence South 47°54'01" West, 206.41 feet; thence South 81'36'13" West, 465.73 feet; thence South 71 °51 '23" West, 60.57 feet; thence North 64o09'59" West, 11.6.35 feet; thence North 38°15'19" East, 77.68 feet to the beginning of a tangent curve, concave westerly and having a radius of 1677.00 feet; thence Northerly 1102.66 feet along said curve through a central angle of 37°40'23"; thence tangent to said curve, North 00°34'56" East, 350.12 feet to the beginning of a tangent curve, concave westerly and having a radius of 2077.00 feet; thence Northerly 901.25 feet along said curve through a central angle of 24°51'42" to the TRUE POINT OF BEGINNING. RESERVING an easement for slope and drainage purposes, including construction and maintenance of drainage infrastructure, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for fuel modification purposes over any portion of the property required to perform fuel modification and brush clearance in accordance with applicable government requirements, sa/d area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING an easement for construction, maintenance and traversal of a Fire Road over that portion of the Property designated by said purposes by any governmental agency with responsibility for the provision of fire service, said area to be delineated upon issuance of said governmental approval. ALSO RESERVING, for a period often (I0) years, an easement for wetland or habitat mitigation purposes, including construction, irrigation, grading, monitoring and maintenance, over any portion of the Property approved for such purposes by any government entity, said area to be delineated upon issuance of said government approval. P:'~.~AS HB 0005~Lcgal Dcscriptions\lotcc.doc 05/07/2B03 3_0: 5~. 9098981693 FIESTA PAGE ALSO RESERVING an easement for grading, realignment and construction of Santa Gertmdis Channel in accordance with approved governmental plans, said area to be delineated upon recordation of the final map for subdivision of adjacent property. ALSO RESERVING for a period of four (4) years, a temporary easement for rehabilitation and restoration of the airfield over thc area shown on the map attached as Exhibit B. ALSO RESERVING the right to access the Property for any of the above described purposes. The above-described parcel of land contains approximately 179.55 acres. That certain real property set forth at Exhibit "A" of this Grant Deed shall be referred to herein as the "Servient Tenement". Each of the easements reserved to Grantor, above, shall be an easement appurtenant to that certain real property described at Exhibit "B" of this Grant Deed (the "Dominant Tenement"), and shall be binding upon and run with the Dominant Tenement and the Servient Tenement. Each of the easements reserved to Grantor, above, shall be for the purpose(s) set forth within the reservation, and for access, ingress and egress across, over and under the Servjent Tenement, as necessary to perform such work. Unless otherwise set forth above, each easement shall be perpetual, but shall terminate when Orantor's obligation to perform work upon the Servient Tenement, as described by each reservation of easement, shall terra/hate. DAVID EVANS AND ASSOCIATES, 1NC. Cliffo~ ~. Simental, PLS L.S. No.5022 Expires: 12-31-05 P:L4AA Sl-IB0005kLegal Dcscriptions\lotcc.doc RECEZVED: 5/ 7/03 10: 18AM; ->CZTY OF TEMECULA; #595; PAGE 15 85/87/2883 10:51 9098981693 FIESTA PAGE 15/16 .~. P.D.C. T.P.O. 8, ~/-~ co~ / · / SEC 21 / ~ N88"29'$7"E 4357.60' i ' V~~ ~ ! ' ~ I~ ~ ~S61'56'22"F 264.05' ~ S63'56'06~F ff3.99' ,~SPR~N~S ~NS~'50'I6~W 159.06' ~ S89'41'59'F 162.15' ~. ~81'26'09'~ ~56.89~ ~ ~47'54'0f~ 206.41' ~557'~0 46 · 87.87~ ~ ~Tt'51'2~*~ 60.5T' ~ ~ ~N84'~2'29~ ~29.22' ~N38'15'19'~ 77.68' ~ ~7'40'2~* R=1677.00' L¢1102, 66' VIClNI~ MAP I ~ N0'34'56 ~ 350. 12' ~ ~4'51'42~ R~077.00' L~Of.25' ~ E~EMENT ~EA ~ESCRiBED HEREIN E~EMENT ~EA 179.55 ACRES EXHIBIT "B" ~ DEDICATION OF J ~ H~ITAT ~o~ ~ ~-161-SHCP DAVID EVeS ~, x~ ~UNTY OF RIV~S~E ~D ~SOClATES, ~ STAT[ Or C~tFOR~A t'-s~' 05/07/2003 10:51 9098981593 FIESTA PAGE 16/16 N SEC 21 __ N88'29 ' 37~'W 4357, 60' "~ / I ~N89'Z6'30~W 33t,3f' ~NaO'11'SZ~F 146.69 ~571'33'56'F 183.58' ~S60'42'39~ 96.06' ~S59'5J'ZI"F 91.23' ~S55'5~'0~ 292.00' ~N89'10'21~ 9Z,~O' ~S3f'08'49"~ 146,57' ~545"ZT'34'F 97.37' ~NO5"40'S4~F ~42,81' ~503'09'12~* 69.52' ~540'50'06"~ 160.77' ~N37'fS'47~E 85.50' ~SZT'4Z'32~E 15L42' ~S51'06'09~F 146.91' ~NZS'31'tS~E 112.~1' ~549'1B'fS'f 61.50' ~S61'56'ZZ~F 264.03' ~NOS'I1'54'E 112.76' ~N68'29'1g~E 150,04' ~N8~'50'16~ 159.06' ~N00.50'32~ 262. f5' ~S41'58'23~E I~3,10' ~N90'OO'OO~F 283,29' ~NZZ'54'31"F 192,56' ~530'10'17'~ 129.03' ~S81'26'09~ 356,89' ~N40~55'~8~ ~72.57' ~S46'17'16~E 70.83' ~572'09'30'~ 161,36' ~NZ4'16'06~ 163,27' ~510'59'54"E 41.~4' ~ EASEMENT ~EA ?ESCRIBED HEREIN E~EMENT ~EA 179,55 ACRES EXHIBIT"BI' DAVID EVeS CO~Y ~D ~SOCIATES, ~ S~A~E OF C~NIA ~".soo' I EXHIBIT G Certain Definitions Environmental Laws means all federal, state, local, or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or requirements of any government authority regulating, relating to, or imposing liability or standards of conduct concerning any Hazardous Substance (as later defined), or pertaining to occupational health or industrial hygiene (and only to the extent that the occupational health or industrial hygiene laws, ordinances, or regulations relate to Hazardous Substances on, under, or about the Property), occupational or environmental conditions on, under, or about the Property, as now or may at any later time be in effect, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA) [42 USCS 3%~ 9601 et seq.]; the Resource Conservation and Recovery Act of 1976 (RCRA) [42 USCS 3~3~ 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act (FWPCA) [33 USCS ~3~ 1251 et seq.]; the Toxic Substances Control Act (TSCA) [15 USCS 3%~ 2601 et seq.]; the Hazardous Materials Transportation Act (HMTA) [49 USCS 3%~ 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 USCS 3~,~ 136 et seq.]; the Superfund Amendments and Reauthorization Act [42 USCS 6901 et seq.]; the Clean Air Act [42 USCS 3~3~ 7401 et seq.]; the Safe Drinking Water Act [42 USCS 3~3~ 30Of et seq.]; the Solid Waste Disposal Act [42 USCS 3%~ 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 USCS 3~3~ 1201 et seq.]; the Emergency Planning and Community Right to Know Act [42 USCS 3~,~ 11001 et seq.]; the Occupational Safety and Health Act [29 USCS ~.~ 655 and 657]; the California Underground Storage of Hazardous Substances Act [H & $ C 3~3~ 25280 et seq.]; the California Hazardous Substances Account Act IH & S C 25300 et seq.]; the California Hazardous Waste Control Act IH & S C ~3~ 25100 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act IH & $ C 3%~ 24249.5 et seq.]; the Porter-Cologne Water Quality Act [War C 3~3~ 13000 et seq.] together with any amendments of or regulations promulgated under the statutes cited above and any other federal, state, or local law, statute, ordinance, or regulation now in effect or later enacted that pertains to occupational health or industrial hygiene, and only to the extent that the occupational health or industrial hygiene laws, ordinances, or regulations relate to Hazardous Substances on, under, or about the Property, or the regulation or protection of the environment, including ambient air, soil, soil vapor, groundwater, surface water, or land use. Hazardous Substances includes without limitation: 1) Those substances included within the definitions of hazardous substance, hazardous waste, hazardous material, toxic substance, solid waste, or pollutant or contaminant in CERCLA, RCRA, TSCA, HMTA, or under any other Environmental Law; 2) Those substances listed in the United States Department of Transportation (DOT) Table [49 CFR 172.101], or by the Environmental Protection Agency (EPA), or any successor agency, as hazardous substances [40 CFR Part 302]; 3) Other substances, materials, and wastes that are or become regulated or classified as hazardous or toxic under federal, state, or local laws or regulations; and 11086-0097\729614 05/07/2003 G-1 4) Any material, waste, or substance that is (i) a petroleum or refined petroleum product, (ii) asbestos, (iii) polychlorinated biphenyl, (iv) designated as a hazardous substance pursuant to 33 USC S § 1321 or listed pursuant to 33 USCS § 1317, (v) a flammable explosive, or (vi) a radioactive material. 11086-0097\729614 05/07/2003 G-2 EXHIBIT H List of Environmental Documents 11086-0097\729614 05/07/2003 H-1 05/07/2003 11:26 9008081693 FIESTA PAGE 02/08 SlD CiEOT._ECflfllC L, IflC. Soil Engineering, Environmental Engineering, Materials Tasting, Geology MayT, 2003 Project No. 990057-01 Ashby UreA, LLC 470 East Hm~ison Street Corona, California 92879 At~ntion: Mr, V~en Tm SUBJECT: Rodpaugh Ranch, P, ppro~jrnately 800 ACreS Rivemid~ County, California Gradient Engineers, lee., lgg~, 'Phase I Environmental Site Asset.~ment Report", A~pmxim~e 800-,6=m Roripaugh Ranch, ~e C~. Ca.amis, P~ No. ~07~01, June 30, 19~. $10 GeeteehnicaL Inc., 2002, 'Environmental Oompliance Report', Roripaugh Ranch, Ap~roximelely 800 Asres, Riverside County, California, Project No. 990057.01. dated Felaruary 25, 2002. As you are aware, the environmental condition of the ~bject 800.acre was evaluated and remedlated as ~10orl~d in the reTufensed reports. Pursuant to your request, we have re-visited the preperb] to confirm that the environmental ~ndittone have remained favombto as noted in our refi~rencod compliar~ Our field ~-.connaissance, conducted May 6, 2003, confirms that the site rema/r~ in a similar oonditlon as tape,md and aU areas of environmental concern have been reme~iated safl~actor~y. Specifically addressed are the Dedica~on of Habitat ama AD-16t .-~SHCP which am not considered to po~e an environmental throat of,.~,iamination or hazard in their present ~ondit~l. We have atlachtxl EXll~it 13 (5 shee~) t~ detail the Dec~k~Eon of Habitat area. 7265 Jurupa Avenue, Suite "E" Riverside, California 92504 Tel: (90g) 688.2300 Fax: (9~3) 688-1060 www. sldg.~e.¢om, contact: Info~sidgeo.com 05/07/2003 11:26 9098981693 FIEST4 PAGE 63/68 We appreekate this opportunity t~ be of continued serviea o~ ~is project, Should you have que~-flons, or require addllional Informalion, please cootaet our office. Very troy ~m. Pmje~Englneer' - -- Attachment~: Exhibit O (5 sheets) 05/07/2003 11:26 9098901693 FIESTA PAGE 04/08 (~ L~'=3'2~'09' R~9,~5.00' L----f?3.17' ~/ / /'~ NO, 02~42151 - -- N64 Od ~-~---~-t-~-~ """"' ~' ' '"'" " ..... '-"~": ....... · C~ ~R I~T, "'~'-'='" I ~o~J~,~ ~ ~ ~ E~ ~. 6.80 ~ ~ DEDICATION OF EXHIBIT H~ITAT 05/07/2003 11:26 9090001603 FIESTA PAGE 05/00 £z~I.W~y ~g ~1 TY OF Ra~945.00' 193.04' 37. 04' 05/07/2003 ~:26 9098981693 F~EST~ PAGE 66/68 OR41NJG~ FaCILI~Ig$ A.--f ~ · 35 '4! R~1 $45, OD ' SgOTl ON 20 RECEIVED: 5/ 7/03 10:51AM; ->CITY OF TEMECULA; #600; PAGE 7 05/07/2003 11:26 9B98981693 FIEST~ PAGE 07/08 Naa *z$'3 ?"ff #$..T7'. 60' sec ~I 05/07/2003 11:26 9098981693 FIESTA PAGE 08/88 T,P,O,£. DEDICATION OF EXHIBIT H~ITAT ' -' ~ ~ S°d.Eng~neer~ng' Ge01QgY' Envlr°nmenta! Engineering February 25, 2002 - TO: Ashby USA, LLC 470 East Hardson Street Corona, California 92879 Project No. 990057-01 .......... A'FI'ENTION: · Mr. Vien Tran - - ....... : ...... .-..:..: : .... _. · .......... SUBJECT: Environmental Compliance Report, RorJpaugh Ranch, Approximately 80L Acres, Riverside County, California REFERENCE: Gradient Engineers, Inc. 1999, "Phase I Environmental Site Assessment Report, Approximately 800-Acres, Roripaugh Ranch, Riverside County, California." Project No 99307-001, Report Dated June 30, 1999. In accordance with your authorization, SID Geotechnical, Inc. has conducted oversight for environmental compliance of the subject prope,%,. Our work was conducted in accordance with the referenced Phase I Environmental Site Assessment performed by Gradient Engineers, Inc. (June 30, 1990). Our scope of work included review of the referenced report, conducting site '~i~its, take color photographs, and soil analytical testing. A summary of our findings, c~ndusions and recommendations are attached. Should you have any questions or concerns regarding this report, please do not hesitate to call this office. We appreciate this opportunity to be of service. Very truly yours, BID Geotechnical, Ir Proje( Distribution: Attachments: Selected Telephone Correspondence Letter 7265 Jurupa Avenue, Suite E; Riverside, CA 92504 · T:I: (90@) 888-2.300 · Fax: (909) 888-1080 · ... ,~::; ...... : . ,,: . Environmental Compliance Report Roripaugh Ranch, Riverside, California 990057-01 February 25, 2002 .<::;I. IMMARY OF OUR RI:VIEW In summary, the Phase I Environmental Site Assessment concluded that the subject'pr~perty exhibits "evidence of recognized environmental conditions" related to waste oil containers, solvent containers, stained soil, above ground storage tanks (AST's), and stockpiles of trash including, but not limited to wood, metals, tires, and rusted 55-gallon drums. In addition to the clean up of these identified environmental conditions, Gradient Engineers, Inc. has made the following recommendations for environmental compliance: The Property owner is to notify the Riverside County DEH prior to clean-up of any TPH impacted soils and properly mitigate the petroleum impacted soils in accordance with the DEH requirements. · The property owner is to notify the San Diego RWQCB prior to the removal of the fuel AST's from the site. · Remove and dispose of the abandoned materials from the site in accordance with appropriate local, state and federal requirements. Each of these recognized environmental conditions are addressed below: The project remediation contractor, Olah Engineering, Inc. of Upland, California reportedly contacted the Riverside County DEH prior to removal of the TPH impacted soil. The DEH indicated that their representative need not be present during removal of the TPH impacted soil. Documentation of their telephone conversation is attached for review. Similarly, the Riverside County DEH reportedly explained to Olah Engineering, Inc. that the San Diego RWQCB need not be contacted in regard to the AST's. Documentation of this communication is also attached for review. The abandoned material, including the TPH impacted soil, identified by the Gradient Engineers, inc. report has been removed from the site and properly disposed. Copies of transportation manifests and recycling or disposal certificates are attached. The diesel AST's, which were reportedly in good condition, were sold to private entities and transported off-site accordingly. SID Geotechnical, Inc. Page 2 Enviionment~l compliance R~port Roripaugh Ranch, Riverside, California 990057-01 February 25, 2002 Following removal of the TPH impacted soils (designated as locations SS1 through SS8 - see attached site plans), our office was contacted to conduct confirmatory samples. Locations SS1, SS3, SS4, and SS8 yielded non-detectable concentrations of hydrocarbons at the bottom of the excavations. Additional impacted soil was removed from locations SS2, SS5, SS6, and SS7. This work was aided with field screening for hydrocarbons using an organic vapor meter (OVM) to assure complete removal of the impacted soil. Confirmatory samples at the bottom of the excavation yielded non- detectable concentrations of hydrocarbons. The analytical test results conducted by a state certified independent laboratory are attached. A final site visit was conducted by our field personnel to confirm that the abandoned materials identified by Gradient Engineers, Inc. have been removed from the site. Photographs of the site confirming the removal of the identified material are attached for review. ADDITIONAL RF:~OMMF:NDATIONS Please note that any future site development or construction activities should be monitored by a representative of SID Geotechnical Inc, or a ~ualified environmental consultant to id,entify areas of possible contamination such as, but not limited to, the presence of underground facilities, buried debris, stained soils, waste drums, tanks, or odorous soil. In the unlikely event that such materials are er~countered, further investigation and analysis may be necessary at that time. We appreciate this opportunity to be of service on this project. Should you have any questions, or require additional services, please contact our office. $1D Geotechnical, inc. Page 3 Enviro - Chem, Inc. . - ~/2~4 E. Lexington Avenue,' Pomona, CA 9'/766 Tel (909) 590-5905 Fax (909) 590-5907 Date: February 11, 2002 Mr. Christopher Krall RGS Engineering / Geology 290 N. Benson Ave., Suite 13 Upland, CA 91~86 (909)985-8109 Fax(909)985-8209 Project: Project ~61~-01 / Roripaugh Ranch Dear Mr. Krall: The analytical results for the soil samples received by our laboratory on February 5, 2002, are attached. All sample containers were received chilled, intact, and accompanying chain of custody record. Enviro-Chem appreciates the opportunity to provide you and your company this and other services. Please do not hesitate to call Mr. John Ackerman, our Customer Service Specialist, or myself, if you have any questions. Sincerely, Curtis Desilets Vice President/Program Manager Mina Farag Lab Manager Enviro - Chem, Inc. 1214 E. Lexington Avenue, Pomona, CA 91766 Tel (909) 590-5905 Fax (909) 590-5907 CUSTOMER: RGS Engineerin~ / Geology 290 N. Benson Ave., Suite 13 Upland, CA 91786 (909)985-8109 Fax(909)985-8209 PROJECT: Project #614-01 / Roripaugh Ranch MATRIX:~QJJ~ DATE RECEIVED:Q2/05/02 DATE SAMPLED:02/05/02 DATE ANalYZED:02/07-08/02 REPORT TO:MR- CHRISTOPHER KP~LL DATE REPORTED:Q2~ TOTAL PETROLEU14 HYDROCARBONS(TPH) - CARBON CHAIN ANALYSIS METHOD: LUFT/EPA 8015M LrNIT: MG/KG = MILLIGP~AM PER KILOGRAM = PPM SAI~PLE LAB GASOLINE KEROSENE DIESEL OIL DF ID ID (C~-C10) (C8~C16) (C!0-C22) (C22-C35) SSI 020205-32 ND ND ND ND ~S2 020205-33 ND ND 14400 ND 100 SS3 020205-34 ND ND ND ND 1 SS4 020205-35 ND ND ~RTD ND ~S5 020205-36 ND ND ND 168 SS6 020205-37 73.9 16.7 30.5 ND l SS7 020205-38 ND ND b~ 2630: SS8 020205-39 ND ND ND ~ METHOD BLANK ND ND ND ND % PQL 10 10 10 100 CO14/~ENTS DF = DILUTION FACTOR PQL = PRACTICAL QUANTITATION LIMIT ACTUAL DETECTION LIMIT = DF X PQL ND = NON-DETECTED OR BELOW THE ACTUAL DETECTION LIMIT CAL-DHS ELAP CERTIFICATE NO.: 1555 Enviro Chem, Inc 12~'~4 E~.-: Lex[n'~i' Avenue, Pom'~'~' CA 91766- -'Tel (909)590-5905 Fax (909)590-590~ 8015M Soil QC )ate Analyzed: 2/8/2002 Units: m,q/Kct (PPM) /latrix: Soil Matrix Spike (MS)/Matrix Spike Duplicate (MSD) Spiked Sample Lab I.D.: 0206-36 SR I spk conc [ MS I %MS I MSD DIESEL I 0 I 3400 1 3661 I 108°/°1 3376 I 99% I 8 175-125t <20°/° I O/oMSO I °""RPO IACP O/oMSl ACP RPD LCS STD RECOVERY: )kconc I LCS 1%REC I ACP )IESEL t 2000 I 1971 I 99°/o 175-125 Analyst Signature: First Reviewer: Final Reviewer: ,.,F~-~-~_2-~ 10:58 ~UI,O~]-CI.-[EM, INC. Enviro- Chem, Inc~ ,-.- '12'14 E. I. ex,fn~on Avenue, Pomona, CA 9'1755 Tel (909) ~'90-5905 909 59Z Fax (~09) 5go-sg07 t~orato~ containers were of cuS.~cdy record. results for the soil samples, received by our February ;20, 2002, are attached. All sample received chilled, intact, and &ccomPanyin~ c.hain co, any ~his a~ o~her se~ices. Please 6o not hesitate t° call Mr. *Jo~ ~kerman, our ~stomer SeT;ice Specialist, or myself, if ', Vi.ca..preslden~.p~Ogr~M~a~er F'EB~22-2~2 iO:b-'g ENUIRO-CH~I, INC. ~09 5DD 5DEF? P.02/04 · Enviro- Chem, inc. ..: z ~' '" ..121~4 E. Lexingto~ .Avenue, P~mona, CA 91'766 Tel [909) ~90..5905 Fax (909) $g0-~907 ':r:t i::,~ ~s~o~:'. .',~i.~''~"'~ / .. . '~.'~,~~... ' '. :; ~0~ ~0~, ~R~O~R ~ DA~ ' '~ ', ~ ': ~ 0 '~ -:9 ~ ~ . ,:~., .. . ~ ~ _~~ .~. ~:..::.:. ~ . ~g~...,.. . ..... ~o ~o ~a ,, .:...~ ~ ~',,.. ... .... '"!"'"":' ' ' ' ' ~ :~ .:. : '..:DF ~:.~,D~ON..~A~ : :... ========================== ............ _:.. ......... .... :': p~_~-~-200~ 10:59 ENU I ~O-C)'~M, INC. Envlro Chem~ In~ ~09 590 $B0'7 ~ 8015M Soil QC 40895 MSB 'ACP 75-125 114% %RPD %MS ^CP'RPO 6 75;~25 · ,p~-22-2002 10:59 ENUIRO-C~, INC. 909 590 P,04/04 TOTAL P. 04 SELECTED S~1'1~ PHOTOGRApHs7`. View showing area of former landings strip buildings and AST's which have been removed. ~ Another view showing the cleared landing strip area. SELECTED SITE PHOTOGRAPHS View showing area where two AST diesel tanks have been removed. View showing the landing stdp area which has been cleared of all buildings and identified materials. SELECTED SITE PHOTOGRAPHS View showing western side of workshop where two portable diesel tanks were removed. ~ View showing area where portable AST and several 55 gallon drums were removed: SELECTED SITE PHOTOGRAPHS View showing the former location of a portable AST that has been removed. Note the residence in the background. ; View showing the general area where AST's and 55 gallon drums were identified. These materials haVe been removed from the site. GENERAL ENGINEERING CONTRACTING FebnJary 27, 2002 Subject: Site Remediation per Gradient Engineer's Phase 1 Report Ro~paugh Ranch, Temecula, CA As requested, the following narrative explains Riverside County DEH involvement in the Phase 2 remedation on the above referenced property. Pursuant to the Gradient Engineerings Phase 1 Report, dated June 30, 1999, Olah Engineering was engaged by Redpaugh Ranches, Inc., to facilitate the remediatien of the TPH impacted soil and supervise the Rodpaugh's efforts in removing the AST's. Gradient Engineedng's Report recommended that Riv. County Department of Environmental Health and San Diego County Regional Water Quality Control Board should be notified of the remedial action required pursuant to the report. Jim Sappington, [nspestor for Riv, County Department of Environmental Health, was notified of the impending remediation via telephone. Mr. Sappington indicated that he need not be present dudng the remedial work and that San Diego RWQCB's would not need to be contacted as the TPH impacted soil and the AST's were not detrimental to any water table or drainage course. Upon completion of the Phase Il remediation, Mr. Sappington has requested a copy of the Final Environmental'Compliance Report. Further, as evidence that the above TPH impacted soil remediation efforts complies with ail local, state and feders[ requirements, we are enclosing herein the following information: 1 Transportation Manifest 2 Remedial Certification ~rom Filter Recycling The information stated herein should be sufficent to close your report. However, if you should require additional information, please contact us at your earliest convenince. Olah Engineering, )nc. Peter M Olah President P.O. BOX 1283 UPLAND, CA S178S-1285 (SO9) SS5-7253 FAX ¢09) S~-2652 CO~. ~c. ~2~ 3. Generator's Name and MaiHna Address 39100 Pour roy 4. GeneratorsPhone( 909 ) 985-7~5~. 5. Transporter 1 Company Name ~i) ter Recyc!in~ Services. 7. Transporter 2 Company Nome 9. Designated Facility Name and Site Address Filter ~ecv¢l';n~ Services, DSO_ ..~...L~on~e Avenue Riatto, C~. 92316 II'lC. 11. Waste Shipping Nome and Description 6. US EPA ID Number lC. A. D. ,. 8. ~. ~.. ~,. ~. z~. 8. US ERA lO Number lO. US EPA ID Number A. Transpor~er'$ Phone (909)$73-~1~1 C. Facility's Phone D.. Additional Descriptions for~AmeriaL~Usted.Abc,ve - 4 , 12. Containers No. Type 907)Z, 21-20 t2 ... Total Unit Quantity Wt~'Vo] E. Handling Codes tar Was~es Listed Above 17. Transpoder 1 Acknowledgement of Receipt of Materials-- .., 18. franspo~er 2 A~nowledgeme*t of ~ipt of ~Oferi~ls '~ ' -- / -~%~ GENERATOR'S COPY GRADIENT ENGINEERS, . Construction, Engineering ,p6 Environmental Services PHASE I ENVIRONMENTAL SITE ASSESSMENT REPORT APPROXIMATE 800-ACRE RORIPAUGH RANCH RIVERSIDE COUNTY, CALIFORNIA Pr~ectNo. 993070-001 June 30, 1999 Prepared For: ASHBY DEVELOPMENT 14785 Village Drive Fontana, California 92337 3934 Murphy Canyon Road, Suite B204, San Diego, CA 92123 Lic.# A734297 (619) 268-1320 FAX (619) 268-5199 GRADIENT ENGINEERS Construction, Engineering ~o6 Environmental Services To: Ashby Development 14785 Village Drive Fontana, California 92337 June 30, 1999 PrQectNo. 993070-001 ! Attention: Subject: Mr. Wesley Hylen Phase I Environmental Site Assessment Report, Approximate 800-Acre Roripaugh Ranch, Riverside County, California Gradient Engineers, Inc. (Gradient) is pleased to present this Phase I Environmental Site Assessment (ESA) Report for the subject property. This ESA was conducted in accordance with Gradient's proposal dated January 28, 1999 and authorization of April 30, 1999. If you have any questions regarding this report, please do not hesitate to contact me. We appreciate the opportunity to be of service. Respectfully submitted, GRADIENT ENGINEERS, INC. Thomas E. Mills, RG 4439 (Exp. 6/30/2000) Principal MMI-FTEM Distribution: (3) Addressee P:~Projects\993070.001~Roripaugh Ranch-Phase I 3934 Murphy Canyon Road, Suite B204, San Diego, CA 92123 Lic. #A734297 (619) 268-1320 FAX (619) 268-5199 993070-001 TABLE OF CONTENTS Section Page Executive Summary E-i 1.0 INTRODUCTION .............................................................................. .~ ............................................................... 1 1. l AUTHORIZATION .............................................................................................................................................. 1 1.2 PURPOSE ........................................................................................................................................................... 1 1.3 SCOPE OF WORK ............................................................................................................................................... I 1.4 LIMITATIONS AND EXCEPTIONS ........................................................................................................................ 1.5 LIMITING CONDITIONS AND METHODOLOGY .................................................................................................... 2 2.0 SITE DESCRIPTION .......................................................................................................................................... 4 2.1 SITE LOCATION ................................................................................................................................................ 4 2.2 LEGAL DESCRIPTION ......................................................................................................................................... 4 2.3 SITE AND VICINITY CHARACTERISTICS .............................................................................................................. 4 2.4 ONSITE STRUCTURES AND IMPROVEMENTS ...................................................................................................... 4 2.5 CURRENT USES OF ADJOINING PROPERTIES ..................................................................................................... 5 3.0 RECORDS REVIEW .......................................................................................................................................... 6 3.1 STANDARD ENVIRONMENTAL RECORD SOURCES ............................................................................................. 6 3.2 PHYSICAL SETITNG SOURCES ............................................................................................................................ 6 3.3 GEOLOGY ......................................................................................................................................................... 6 3.4 GROUNDWATER CHARACTERIZATION .............................................................................................................. 7 3.5 REVIEW OF PREVIOUS REPORTS ....................................................................................................................... 7 3.6 SOIL SAMPLING RESULTS ................................................................................................................................. 7 3.7 HISTORICAL USE INFORMATION ....................................................................................................................... 8 3.7.1 Aerial Photographs ................................................................................................................................. 8 3.7.2 Fire Insurance Maps ................................................................................................................................ 8 3.7.3 Title Documents ....................................................................................................................................... 8 3.7.4 Radon ...................................................................................................................................................... 9 3.7.5 AdditionalRecordSources ....................................................................................................................... 9 3. 7. 6 Summary of Historical Landuse .............................................................................................................. 9 4.0 SITE RECONNAISSANCE ............................................................................................................................... 10 4.1 OBSERVED USES AND CONDITIONS ................................................................................................................ 10 4.2 ADDITIONAL OBSERVATIONS ......................................................................................................................... 12 5.0 INTERVIEWS ................................................................................................................................................... 13 6.0 QUALIFICATIONS .......................................................................................................................................... 14 6.1 CORPORATE .................................................................................................................................................... 14 6.2 INDIVIDUAL .................................................................................................................................................... 14 GRADIENTENGINEERS ~c. TABLE OF CONTENTS {Continued) List of Accompanying Appendices and Illustrations Figure 1 - Site Location Map - Page 3 Figure 2 - Site Reconnaissance Map - Rear of Text Figure 3 - Site Reconnaissance Map - AOC1 - Rear of Text Figure 4 - Site Reconnaissance Map - AOC2 - Rear of Text Appendix A - References and Aerial Photographs Reviewed Appendix B - VISTA Report dated Appendix C - Laboratory Data Report Appendix D - Site Reconnaissance Photographs Appendix E - Records of Communication ii 993070-001 GRADIINTENGINEERS t~c. 993070-001 EXECUTIVE SUMMARY Gradient Engineers, Inc. (Gradient) performed a Phase I Environmental Site Assessment (ESA) at the Roripaugh Ranch in Riverside County, California (Figure I). The purpose of this ESA was to identify recognized environmental conditions on the site. The term recognized environmental conditions is defined by ASTM Standard E 1527-97 as "the presence or likely presence of any hazardous substances or petroleum products on the property under conditions that indicat~ an existing release, a past release, or a material throat of a release of any hazardous substances or petroleum products into structures on the properly, or into ground, ground water, or surface water of the property". The scope of work for this assessment included: records review, site reconnaissance, interviews, and report. The 800- acre subject site (Site) is located north and east of the unimproved Nicolas Road in Riverside County, California (Figure 1 - Site Location Map). Based on historical records, land usage is summarized as follows: Time Period I Land Usage [ Reference Prior to 1949 Unknown Not available 1949 to 1967 P~rtially utilized for agriculture Aerial photographs 1967 to present Agricultural, residential and airstrip Interview Aerial photographs Adjoining properties have been used for similar purposes as the Site, primarily residential and agricultural. A search of selected government databases was conducted by Gradient using Vista Information Solutions, Inc. (VISTA) "StarView" environmental database report system. Review of the VISTA report indicates that no database listings (finds) were reported for the Site. Nine (9) database sites are located within a 1 and 1/8 mile radius of the Site. These database sites consist of USGS/State water wells and according to the report, the wells are utilized for domestic or irrigation purposes or not used at all. Based on the data presented in the VISTA report, none of the database sites appear to pose a threat of environmental contaminationat the Site. Review of aerial photographs from 1949, 1967, 1986, 1990, 1993, 1995 and 1997 and interviews with persons knowledgeable about the Site indicated that recognized environmental conditions of concern were not reported for the Site. On June 1, 1999, Gradient staff visited the Site to assess current Site utilization and to identify possible environmental conditions of concern. Groundwater wells were not observed on the Site. Evidence of sumps, underground storage tanks, pumps or clarifiers or were not observed on the Site. Evidence of aboveground storage tanks (ASTs) and drums/chemical containers were noted on Site. Evidence of recognized environmental conditions were noted in primarily two (2) areas of the Site. The two (2) areas consisted of a heavy machinery storage and maintenance area (AOC 1 ) and an airstrip (AOC 2). These two areas are located in the central western portion of the Site. Waste oil containers, solvent containers, stained E-i GRADIENTENGINEERS 993070-001 soils, ASTs, and stockpiles of trash including, but not limited to, wood, metals, tires, rusted 55-gallon drums were noted in these areas. On June 1, 1999, Gradient staffalso collected a total of 15 near surface soil samples. Seven (7) samples were collected to assess for the absence/presence of pesticides in the agricultural areas of the Site. The remaining eight (8) samples were collected below observed stained areas in the two (2) areas of concern AOC I and A©C 2 and analyzed for total petroleum hydrocarbons (TPH). None of the seven (7) samples analyzed for pesticides had any detectable concentrations of pesti'cides. The following table summarizes the results of the samples collected and analyzed for TPH: Sample ID TPH (mg/kg) TPH Identification SS 1-2" 483 Weathered diesel and waste oil SS2-2" 3,570 Weathered diesel and waste oil SS3-1' 1,230 Weathered diesel and waste oil SS4-1' 249 Weathered diesel and waste oil SS5-3" 153 Waste oil SS6-2" 69 Weathered diesel and waste oil SS7-4" 14t Waste oil SS8-3" 583 Weathered diesel and waste oil On June 29, 1999, Gradient spoke with Ms. Dori Malloy of the Riverside County Department of Environmental Health (DEH) regarding the TPH impacted soil. According to Ms. Malloy, there is no specific criteria regarding the impacted soil. However, the DEH should be notified prior to removal of the soils so there can be a DEH representative present to oversee the cleanup and verification sampling at the time the impacted soil is removed. In addition, the San Diego - Regional Water Quality Control Board (RWQCB) is the lead oversight agency regarding the ASTs and should be notified prior to removal of the diesel ASTs from the Site. Based upon the information obtained during the course of this assessment, Gradient presents the following opinion: Gradient performed a Phase I ESA for the Site in conformance with the scope and limitations of ASTM Practice E 1527-97. This assessment did indicate evidence of recognized environmental conditions of concern in connection with the property (TPH impacted soils). Based upon the findings of this Phase I ESA, Gradient recommends: · The property owner is to notify the Riverside County DEH prior to the cleanup of any TPH impacted soils and properly mitigate the petroleum impacted soils in accordance with the DEH requirements. · The property owner is to notify the San Diego RWQCB prior to the removal of the fuel ASTs from the Site. · Remove and dispose of the abandoned materials from the Site in accordance with appropriate local, state and federal requirements. E-ii GRADIENTENGINEERS~. 993070-001 That observations be made during any future Site development for areas of possible contamination such as, but not limited to, the presence of underground facilities, buried debris, staining soils, waste drums, tanks, or odorous soils. Should such materials be encountered, further investigation and analysis may be necessary at that time. E-iii ¥~rGRADIENT ENGINEERS ~. 1.1 1.2 1.3 1.4 993070-001 1.0 INTRODUCTION Authorization In accordance with Ashby Development Co. authorization, Gradient completed a Phase I Environmental Site Assessment (ESA) of the Site. This work was conducted in accordance with Gradient's proposal dated January 28, 1999, and with J~shby Development Co. authorization signed by Mr. Justin Ashby, dated April 30, 1999. Purpose The purpose of this ESA was to identify recognized environmental conditions of concern on the Site. The term recognized environmental conditions is defined by ASTM Standard E 1527-97 as "the presence or likely presence of any hazardous substances or petroleum products on the properly under conditions that indicate an existing release, a past release, or a material threat of a release of any hazardous substances or petroleum products into structures on the property, or into ground, ground water, or surface water of the property". Recognized environmental conditions include hazardous substances or petroleum products even under conditions in compliance with applicable laws. The term does not include de minimis conditions that generally do not present a mcterial risk of harm to public health or the environment. Scope of Work The scope of work was performed in accordance with Gradient's proposal and included the following tasks: · Site Reconnaissance and Soil Sampling · Records Review; · Interviews; · Report. This ESA did not include air or water sampling, or investigations for radon, asbestos or lead- based paint. Limitations and Exception~ The findings and professional opinions presented in this report are based on the information made available to Gradient (in most cases from previous reports and from public records) and could change if additional information becomes available. In performing our professional services, Gradient applied present engineering and scientific judgment and used a level of effort consistent with the standard of practice measured on the date of this report and in the vicinity of the project site for projects of similar scope. Gradient makes no warranties, either express or implied, concerning the completeness of the data made available to us for this study. Gradient specifically withholds certification of any type concerning the absence of contamination at the Site. -1- I~GRADIENT ENGINEERS INC. ! I I II § ii § 1.5 993070-001 Limiting Conditions and Methodology The methodology used during this assessment conforms with current standard of care in the performance of Phase I ESAs in southern California. The list of references used for this study is included as Appendix A. The research of selected government databases was performed by Gradient using Vista Information Solutions, Inc. (VISTa) "StarView" environmental database program. A copy of the VISTA report is included as Appendix B. The laboratory data report is presented in Appendix C. Representative color photographs of the Site and area that were taken during the Site reconnaissance are presented in Appendix D. Government records documenting the history of hazardous materials in this area are generally reliable for only the past ten years or less; therefore, undocumented sites or events may exist, and early records of the Site may not have been made available by the agencies for review. Records of communication with persons familiar with the Site are presented in Appendix E. -2- ¥~GRADIENT ENGINEERS ira, BASE HAP: Thomas Bros. OeoFinderfor Window, Rivemide Count, 1995, Page 929 0 2000 ~000 PROJECT NO. RorJpaugh Ranch S ~ T E 993070~0t Riverside Count,. California LOCATION June 1999 HAP 2.1 2.2 2.3 2.4 993070-001 2.0 SITE DESCRIPTION Site Location The 800-acre Site is located north and east of the unimproved Nicolas Road in Riverside County, California (Figure 1 ~ Site Location Map). Legal Description A title report was not provided for Gradient to review for this assessment. Site and Vicinity Characteristics The 800-acre Site is currently being utilized for residential and agricultural purposes. The Site consists of relatively hilly terrain, and several drainage canyons transverse the Site from northeast to southwest. The owner of the Site, Mr. Leo Roripaugh, has owned the Site for approximately40 years and has dry-farmed (wheat) and lived at the Site since. The municipal water district (MWD) has an easement transversing the Site from approximately north to south in the central northern area. The easement is shown on Figure 2. Onsite Structures and Improvements The majority of the Site is comprised of open land. The following three (3) areas on the Site have structures: 1). The residential area located in the central north area of the Site. This area has two (2) single- family residences. 2). The equipment area (AOC 1) located in the central east boundary of the Site. Three (3) buildings (a single-family residence, storage building and maintenance workshop) are present in this area, including an inoperable windmill. 3). The airstrip area (AOC 2) located to the east of the maintenance area. Five (5) buildings are located in this area including two (2) airplane hangers and three (3) storage buildings/sheds. The Site receives its water from a private well and sewer is released into an on site septic tank. -4- ~r~'G RADIENT ENGINEERS 2.5 993070-001 Current Uses of Adioining Properties Surrounding properties are summarized in the following table. Properties I Land Use Adjacentpropertiestothe north: * Agriculture · Residential Adjacent propertiesto the east: · Residential Adjacent propertiesto the south: *. Residential Adjacent propertiesto the west: · Residential -5- GRADIENTENGINEERS 3.1 3.2 3.3 993070-001 3.0 RECORDS REVIEW Standard Environmental Record Sources A seamh of selected government databases was conducted by Gradient using Vista Information Solutions, Inc. (VISTA) "StarView" environmental database report system. Details of the database search along with descriptions of each database reseamhed are provided in Vista's report (Appendix B). Figures 2 and 3 of VISTA report (Appendix B) show the nearby properties listed on the databases that are within a V4 and 1-mile radius of the Site. A search of selected government databases was conducted by Gradient using Vista Information Solutions, Inc. (VISTA) "StarView" environmental database report system. Review of the VISTA report indicates that no database listings (finds) were reported for the Site. Nine (9) database sites are located within a I and 1/8-mile radius of the Site. These database sites consist of USGS/State water wells and according to the report, the wells are utilized for domestic or irrigation purposes or not used at all. Physical Setting Sources United States Geological Survey (USGS) 7.5-minute topographic map, Bachelor Mountain, California, 1953 (photorevised 1973), was reviewed. The map indicates that the Site is located in primarily undeveloped area. The Site is primarily hilly terrain with two (2) unimproved roads transversingthe Site from the east to west in the central portion and from north to south in northern half along the east boundary. A windmill is present on Site in the central area along the eastern boundary. In addition, two (2) creeks transect the Site. The Santa Gertrudis Creek transects the northern half of the Site from the northeast to the southwest. Another creek (unnamed) transects the southern half of the Site from east to west. A walkthrough Site reconnaissance did not reveal existing wetlands or conditions, such as reeds on standing water, which would indicate the presence of a wetland on the Site. In addition, Gradient's review of the USGS topographic map revealed no evidence of wetlands on the Site. According to the topographic map, the site ranges in elevation from 1400 feet above mean sea level along the highest ridge (central portion of Site) to 1200 in the lowest areas of Site. Geology The Site is locates in the Peninsular Range Geomorphic Province if California. The Site consists of topsoil, alluvium, colluvium and the Quaternary Pauba Formation (Leighton, 1990). -6- GRADIENTENGINEERS i~. 3.4 3.5 3.6 993070-001 Groundwater Characterization Hydrogeological data was not available for our review. However, based on the topographical gradient at the Site, the anticipated direction of groundwater flow is toward the west. According to Mr. Leo Roripaugh, the depth to water in his water well is 40 feet below grade. Review of Previous Reports No previous environmental reports were available for our review for the Site. Soil Sampling Results On June 1, 1999, during the site reconnaissance, 15 soil samples were collected on Site. Seven (7) soil samples (S1 through S7) were collected in agriculture use area at one foot below grade and analyzed for pesticides by EPA Method 8080. The locations of the seven (7) sample locations are shown on Figure 2. The remaining eight (8) samples (SS1 through SS8) were collected in the airstrip and maintenance areas where there is petroleum hydrocarbon soil staining. The samples were analyzed for total petroleum hydrocarbon (TPH) extended by ASTM D2887. The samples were collected below staining at varying depths below grade. The samples were placed in laboratory provided jars and placed on ice. The samples were subsequently transported by proper chain of custody to Pacific Treatment Analytical for laboratory analysis. The laboratory report and chain of custody are presented in Appendix C. In summary, the seven (7) samples that were analyzed for pesticides did not have any detectable concentrations of pesticides at or below the laboratory detection limits. The following table summarizes the laboratory data for the remaining samples that were analyzed for TPH. Sample ID TPH (mg/kg) TPH Identification SS 1-2" 483 Weathered diesel and waste oil SS2-2" 3,570 Weathered diesel and waste oil SS3-1' 1,230 Weathered diesel and waste oil SS4-1' 249 Weathered diesel and waste oil SS5-3" 153 Waste oil SS6-2" 69 Weathered diesel and waste oil SS7-4" 141 Waste oil SS8-3" 583 Weathered diesel and waste oil The laboratory data is also summarized on Figures 2, 3 and 4. On June 29, 1999, Gradient spoke with Ms. Dori Malloy of the Riverside County Department of Environmental Health (DEH) regarding the TPH impacted soil. According to Ms. Malloy, there is no specific criteria regarding the impacted soil. However, the DEH should be notified prior to removal of the soils so there can be a DEH representative in order to oversee the cleanup and verification sampling. In addition, the Regional Water Quality Control Board (RWQCB) is the oversight agency for ASTs and should be notified regarding the diesel ASTs. -7- '~¥GRADIENT ENGINEERS I~. 3.7 993070-001 Historical Use Information 3.7.1 Aerial Photographs Historical aerial photographs were reviewed for information regarding past Site uses. Aerial photographs were reviewed for the following years: 1949, 1967, 1986, 1990, 1993, 1995 and 1997. References are provided in Appendix A. In the 1949 aerial photograph, the Site and the surrounding areas at,pear to be partially utilized for agricultural purposes. There is no evidence of the airstrip, single-family residences or equipment storage area. There does not appear to be any residential development in the surrounding areas. In the 1967 aerial photograph, a structure, possibly the windmill is evident on Site. The MWD property easement appears on Site. The surrounding areas appear to be minimally changed from the 1949 aerial photograph. In the 1986 aerial photograph, the airstrip appears to be present. There does not appear to be any buildings or airplanes in the area of the airstrip. There appears to be scattered residential development in the surrounding areas. In the 1990 aerial photograph, the Site appears to be similar to the present. The airstrip, single-familyresidences and equipment storage area are present. In the 1993 aerial photograph, there appears to be minimal change from the 1990 aerial photograph. In the 1995 aerial photograph, there appears to be minimal change from the 1993 aerial photograph. In the 1997 aerial photograph, there appears to be minimal change from the 1995 aerial photograph. 3.7.2 Fire InsuranceMaps Fire insurance maps were not reviewed for this assessment. 3.7.3 Title Documents Title documents were not provided to Gradient for review in this assessment. -8- ~'I~GRADIENT ENGINeERs i~c. § 3.7.4 3.7.5 3.7.6 993070-001 Radon In 1990, the StateofCalifornia(1990)conductedaradonsurveyinthestate. The resultsof the survey indicate that for the 182 samples obtained in Region 9 which included Riverside County, the arithmetic mean radon levels were 0.6 pC i/I. This average total is below the U. S. EPA radon action level of 4 pCi/l. Additional Record Sources Additional City and County Agency record sources could not be assessed since the Site does not have a specific address. Summary of Historical Landuse Based on historical records, land usage is summarized as follows: Time Period I Land Usage [ Reference Prior to 1949 Unknown Not available 1949 to 1967 Partially utilized for agriculture Aerial photographs 1967 to present Agricultural, residential and Interview airstrip Aerial photographs -9- I~¥GRADIENT ENGINEERS I~. [] 4.1 993070-001 4.0 SITE RECONNAISSANCE Observed Uses and Conditions On June 1, 1999, Gradient staff visited the Site to assess current Site utilization, to locate possible areas of environmental conditions of concern. Photographs of the Site are presented in Appendix D and their view directions are noted on Figure 2, 3 and 4. Items noted during the Site reconnaissance are also noted on Figure 2, 3 and 4. The Figures consist of the following: Figure 2: Figure 3: Figure 4: Overall Site Map Site Reconnaissance Map of the Maintenance Area/Residential/Heavy Equipment Storage Area Site Reconnaissance Map of the Airstrip Area In addition, the Site primarily consists of two (2) areas of concern (AOC), which consists of the following: AOC 1: AOC 2: Maintenance area/heavy equipment storage area located along the central west boundary of Site (Figure 3) Airstrip area located in the central area of Site to the east ofAOC 1 (Figure 4). Hazardous Substance in Connection with Identified Uses: Evidence of storage of hazardous materials was noted in the following areas: AOC 1: 55-gallon drums were noted to contain oil and several 5-gallon plastic containers contained hydraulic fluid (Appendix D, Photo 4). Hazardous Substance Containers and Unidentified Substance Containers: Evidence of hazardous or unidentified substance containers Was noted. AOC 1: Several unlabeled containers were noted throughout this area. Some of the containers appeared to contain waste oil [Appendix D, Photo 3 (sampled, and soil staining -2 ft.x2 ft.), Photo 4 (sampled and soil staining ~4 ft. x 4 ft.) and Photo 5]. AOC 2: Several unlabeled containers were noted throughout this area. Some of the containers appeared to contain waste oil [Appendix D, Photo 11 (sampled and staining -2 ft. x 8 ft.) and Photo 14 (sampled and soil staining 3 ft. x 4 ft.)]. On Site Regulated Substance Identification/Inventory: Chemical containers/drums were observed on the Site during the Site reconnaissance. See above discussion. -10- GRADIENTENGINEERS 993070-001 Storage Tanks and Pipelines: Evidence of underground storage tanks (USTs) was not noted on Site. Aboveground storage tanks (ASTs), pipelines associated with or evidence of current or former ASTs were observed on the Site. Several ASTs were noted on Site. AOC 1: Two (2) water ASTs were noted. A portable fuel tank was noted in the area of the Roripaugh residences (Appendix D, Photo 1) petroleum hydrocarbon odors and soil staining were noted (-2 ft. x 3fi.), a sample was collected (SS1-2"). A fuel AST was noted in the central area of AOC 1 and a 'portable AST (diesel) was observed adjacent to the maintenance shed/workshop. Two (2) diesel ASTs (Appendix D, Photo No. 6) were noted along the road that leads to the airstrip. Soil staining (--4 fi. x 4ft.) and petroleum hydrocarbon odors were noted and a sample was collected (SS4-1'). AOC 2: Four (4) ASTs were noted in this area (Appendix D, Photos 10 and 15). One of the ASTs was labeled to containing unleaded fuel (Appendix D, Photo 10). No staining or odom were noted. The other three (3) ASTs were not labeled as to their contents nor was their any evidence of staining or odors, however, one (1) of the tanks (Appendix D, Photo 15) was in dense vegetation and was not reachable. An AST was also noted in the central south boundary of the Site (Appendix D, Photo 16). The location of the AST is also shown on Figure 2. There was no odors or soil staining associated with petroleum hydrocarbons in the vicinity of this AST. Monitoring Wells or Remedial Activities: Evidence of monitoring wells or remedial activities were not observed at the Site. Indications of Solid Waste Disposal: Indications of solid waste disposal was observed on Site. AOC 2 had several areas of discarded debris. At the east end of the airstrip, a large pile of debris was noted (Appendix D, Photo 7). The debris consisted of discarded metal pieces, wood, tires and empty and crushed rusted 55-gallon drums. Across the airstrip to the southwest, more debris was noted (including tires, 55-gallon empty drum, and corrugated steel pipes) (Appendix D, Photos 8 and 9). Adjacent to the airstrip and to the south, dense vegetation, rusted debris and equipment were noted (Appendix D, Photos 12, 13 and 14). Discolored, Distressed or Discolored Vegetation: Evidence of discolored, distressed or discolored vegetation was not noted on Site. Stained or Discolored Soil: Evidence of stained or discolored soil was noted on the Site. See the above discussions. Obvious Odors: Evidence of odors was noted on the Site. See the above discussions. Inclinations of Polychlorinated Biphenyls (PCBs): Evidence of leaking, PCB-containing pad or pole mounted transformers, fluorescent light ballasts or other PCB-containing equipment were no.~t noted. Asbestos Containing Construction Material (ACCM): An ACCM survey was not included in our scope of work. -11- I~GRADIENT ENGINEERS 4.2 Lead-Based Paint: A lead-based paint survey was not included in our scope of work. Additional Observations · Heavy equipment storage was noted in AOC 1. · A residence was noted in AOC 1. 993070-001 -12- ~rGRADIENT ~NGINEERSI~. n 993070-001 5.0 INTERVIEWS Gradient conducted interviews with persons having knowledge of current or past Site usage. Interviews were conducted either orally or in the form of a written questionnaire. Written responses are included as Appendix E. The following person was interviewed: Mr. Leo Roripaugh, the owner of the Site completed a' standard Phase I ESA background questionnaire for the Site. According to Mr. Roripaugh, he has owned the Site for 40 years. The Site has been utilized for dry farming practices throughout Mr. Roripaugh's ownership. The previous owner of the Site was Mr. Roripaugh's grandfather. Mr. Roripaugh stated that there has never been USTs on Site, only ASTs. Mr. Roripaugh did not indicate any conditions of environmental concern for the Site. -13- GRADIENTENGINEERS thc. 993070-001 6,0 QUALIFICATIONS 6.1 Corporate GTG, Inc. is the parent firm for four firms, of which Gradient Engineers, Inc. is one. The other three firms are: Leighton and Associates, Inc., Teratest Labs, Inc., and Earth Consultants International, Inc. Gradient was formed in 1997 and between 1983 and 1997, was the Environmental Services Division of Leighton and Associates, Inc. Gradient provides professional services in environmental engineering which involves the application of science and engineering to environmental compliance, contamination assessment and cleanup, and the management of hazardous, solid and industrial waste. Phase I Environmental Site Assessments are a part of this practice area and have been conducted by Gradient. 6.2 Individual The qualifications of the Project Manager and the other Gradient environmental professionals involved in this Phase I ESA meet the Gradient corporate requirements for performing Phase I ESAs. In addition, Mr. Mills is a Registered Environmental Assessor and Geologist in the State of California. -14- ¥~IrGRADIENT ENGINEERSi~. 993070-00! APPENDIX A REFERENCES ASTM, 1997, ASTM Standards on Environmental Site Assessments for Commercial Real Estate, Designation E 1527-97, dated March 10, 1997. Leighton and Associates, Inc., 1990, Geotechnical Investigation and Evaluation of Possible Fault, Proposed Roripaugh High School, Murrieta, California, dated October 24. State of California, Department of Health Services, 1990, California Radon Survey of Interim Results, 9 pages. AERIAL PHOTOGRAPHS REVIEWED Date Flight Frame Scale Source 5-23-49 AX.M- 1 OF 66/67 Not Available Continental Aerial Photograph 5-23-49 AXM- 1 OF 82/83 Not Available Continental Aerial Photograph 5-9-67 AXM- 1 I-IH 73/74 Not Available Continental Aerial Photograph 7-30-86 86184 164/165 Not Available Continental Aerial Photograph 10-12-90 90205 164/165 Not Available Continental Aerial Photograph 5-14-93 C90-6 187/188/189 Not Available Continental Aerial Photograph 10-04-95 EMWD 164/165 Not Available Continental Aerial Photograph 10-15-90 C 117-43 92/91 Not Available Continental Aerial Photograph l I § A-I Project Name/Ref #: Not Provided Wesley Hylen Roripaugh Ranch Ashby Development Company Nicolas Road 31566 Railroad Canyon Road Murrieta, CA 92592 Canyon Lake, CA 92587 Latitude/Longitude: ( 33,549080, 117.095065 ) USERA : NPL::: ~ Na~iO~a!P[i0[it~:EiS~. : ~~ o o 0S EP~ ;; COR~CTg RCRA ::~[[e~ti~ A~[i0ns o o 0 o S~TE SPE~ ~ ~ ~S~A~ ~i~aient priority lis~ ~ o o 0 o o o o US EPA ; NFRAP reVi~USEpA O O O USEpA CO; 0 0 0 sTAT~ :SWEF ;; ; PeCtic(ed aS Solid was(e iandfiils~; ~ ~ 9 2 2 uS EPA ~ ~RIS T6~:ReieaSe tn~en~b~ d~[abaSe 0 0 . ~ ~a~b~0usd st0rage tanks 0 0 ! For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6. I Page #1 OS EPA 'ERNS · :~:: .~Emerge~cy Re~d~e Notification' ' ::' ' . ~" . :?;~:~::S~t~ef:spiJls~::' :: : ' : : o us EPA · · GNRIR :::: ?::~R~registe~d:small or,large' :' ~. :. .: :: :;: ~ ::;~h~tb~;~:h~rdou~:w~ste:. · ' 0 fhi~ repoA; mee~: the' AS~ Stahda{d' E~ 52F:for ~[a. nd~rd fede~AI.and~State:governmen[ database research in a Phase t edvironmental site assessment..A (-) indicateg.a: distance not Searched · becau~e::it exceeds ~e::~IM sea~d~ ~ara~eters ': . ; . ':..' ..: : .: :.::...::: .: ..::~.:: :;::::~/.:~:.:.::. ~:.~..~:::.~::';;' :: ..:.:: . · .: .. ..:::.~:. :.:;. ... UM~A~ON;~F~ABI~' ': ::. ~:::::[ ;:.:;. :; ~ ~ :~::.:;:..':.." ":';:' . . . . ; . : ~::::.:~ ~ :.: : VI~A ~nnot ~ an insurer of~e accuracy of Be;infe¢ma~O~Oc~u,ing!lh ~,~rsB~ of data; or lu cuffo~e~'s u~e 0f dA~.. ' : ~oraRe.'delb~;.Ib~s or ex~s~emd by c~om~ fesbEin~ d~ly or:indke~ aO~ ~y info~a~mn:~o~ by NOTES It For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Felon 2.& I Page ~2 SI'gE ASSESSMENT PLUS.:REPORT..: ' .(EX~ENDED.BY 1 M'i£~).. ;..'.'. . ' '.-:.:MAp 0f'Sites:Within2 MileS':: :'::'. ) / . /- ..... ///; / / '. ' ~ .,-" .... ~ k. / ,' ~.~ ~ %~ '~'~ ~7/I/I.~'L.~ ~~ ~..~ .-'xh ~. .- ~ · ............... ....... ,....---%,, ~ ~~ ,~/.. .... ..... ... ....... . 7 ~ Miles Catego~: A B C D Subject Site Databases Searched to: 2 mi. 1 1/2 mi. 1 1/4 mi. 1 1/8 mL ~ Single Sites ~ ~ A O Multiple Sites ~ m A ~ Highways ~nd Btjor ~o8d~ NPL, SPL, CE~CLIS~ UST ERNS, % Roads CORBOTS ~FRAP, GENERATORS % Bailroads (TSD) TSD, LUST, '""-'" ' '"'"' ~iwrs or Water Bodies Il addilbnal d~l~bt~e ~m I~in[~SCL~v.r p~. of ~h..po~ lh~y ~ ~1~o di~pl~y~ · ' '-''' '*' Utilities on this map. ~e map ~m~l us~ co~s~nds to the database ~tego~ leaer A,B,C,D. For More Information Call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403 Report ID: 993070001 Date of Report: June 9, 1999 · ':sITE:..ASSESSMENT;:~PLUS REPORT ;: · .'. ~:i' '::'. i..iEX~ENDE'DB¥.~ ;Mibi) :: .: .:.: .' : .i: ..:Mais:ofsiteswithin:i 1/4::Miles '... :: ~- ~ B ~,~,Z ~ ~: ~ '., ~ ..: '.... Amnido ~l Re ~ . ' ............ .,,- , Catego~: A B C D Subject Site Databases Searched to: 2 mi. I 1/2 mL 1 1/4 mL 1 1/8 mi. Multiple Sites ~ m A 0 ~ Highways and Major Roads NPL, SPL, CERCLIS~ UST ERNS, ~ Roads CORRACTS NFRAP, GENE~TORS ~ Railroads (TSD) TSD, LUST, ""-"" ..... "" Rivers or Water Bodies if add.~nal databas~ are I~ln~e~ver page of the m~ they am also displayedL CL For More Information Call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403 Report ID: 993070001 Date of Report: June 9, 1999 Page #4 · SITE ASSESSMENT;PLUS REPORT .' i (EXTENDED:BY 1' MILE).. Joiynn R~' E ~ ~/ ~ [.-.. "'~ ~ ~ "~ .... ~ ~ i _. ..2 ~ ~ .....' I ~ I / .... -'" :'-~ ~ ~ ~ ~ Miles ~ Highways and Major Roads Subject Site ~ Roads ~ Railroads '"--.--' ' '"-. Rivers or Water Bodies *~- "''" Utilities For More Information Call VISTA information Solutions, inc. at I - 800 - 767 - 0403 Report ID: 993070001 Date of Report: June 9, 1999 Pa~e #5 USGS WATER WELL ID #33325111705540q84~,~oo lA CA 0.16MI X SW USGS WATER WELL ID #33325011705580q84~3~ 1B CA 0.22 MI X SW USGS WATER WELL ID #33325111706000~18464ol 1 B CA 0.24 MI X w USGS WATER WELL ID #33322411706270~846228 2 CA 0.88 MI X sw USGS WATER WELL ID #33333411705000~846727 3 CA 0.92 MI X NE USGS WATER WELL ID #33323211706450q846272 4 CA 1.o5 MI X w USGS WATER WELL ID #33323511706470~18'~z88 4 CA 1.o~; MI X W USGS WATER WELL ID #33334311705000q846z?8 5 CA 1.o~ MI X USGS WATER WELL ID #33334611705030q8#6~o3 5 CA 1.o8 MI X NE :::::: :::::::::::::::: :: :: ::::::::::::::.!:::: i USGS WATER WELL CA USGS WATER WELL CA X = search criteria; · = tag-along (beyond search criteria). For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 iM~ ::: ::: ::/:~i:::/:i::::;~ :~ii:~(~'~i~iA:~:~2~:?:~i::~i;)~ii~i!i!Fi!::i:i ?://il !i:ii!i ?:ii iii}i ~:i!?:~ ~ i/:!::} :.:: ::: :~ :~:~; ~iii :/!:: ::~i:.~:~ ~ /:}i !iiili ::ili :i:~ USGS WATER WELL ID #33314811705040qs,~*r r 1 7 , CA 1.39MI X SE USGS WATER WELL ID ~33340511706330~a469~3 8 ~.4~ M~ X , CA NW No Records Found m m il m X = search criteria; · = tag-along (beyond search criteria). For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6.1 Page//7 TEMECULA 5813411 RAINBOW CANYON RD X TEMECULA, ~A TEMECULA 744~42o EAST OF H~ 15 X ~EMECU~, CA TEMECULA LANDFILL 8697655 NWl/4, SEC 30, T8S, R2W X TEMECULA, CA GTE REDHAWK CENTRAL OFFICE 32505 STATE HIGHWAY X TEMECULA, CA 92589 TRI WEST/PACIFIC SOD 45620 E PALA RD X PA~, ca X = search criteria; · = tag-along (beyond search criteria). For more information call VISTA Information Solutions, Inc. al: 1 - 800 - 767 - 0403. Report ID: 993070001 Dat,e of Report_: June 9, 1999 Version 2,6. I Page #8 SITE ASSESSMENT PLUS REPORT (EXTENDED .BY 1 .MILE:): :.DETAILS Agency Address: SAME AS ABOVE Well ID: 333257177055401 Use: STOCK Depth: rog.o Latitude: 33.5475 Longitude: - 117.0983333333 Surface Elevation: rz75. Static Water Level: 57.00 County FIPS: 8085 Agency Address: Well ID: SAME AS ABOVE 333250117055801 Use: DOMESTIC Depth: 740.0 Latitude: 33.547222222222 Longitude: -11/.0994444444 Quadran~]le Name: BACHELOR MTN Surface Elevation: 1205. County FIPS: 6065 US~S W~i ~i; ~deta IEPA;'Agency ID I:N/A iiiii~::~::~ iiiI Agency Address: Well ID: ~AME AS ABOVE 333251 ? 17060001 Use: UNUSED Depth: 293.0 Latitude: 33.5475 I Longitude: -7r7.7 Surface ElevatJ~on: 7200. * VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions. Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6,1 Page #9 Level: 54.00 6065 Agency Address: ,SAME AS ABOVE Well ID: 333224117062701 Depth: 240.0 Latitude: 33.54 Longitude: . ~17. r075 Quadrangle Name: BACHELOR MtN Surface Elevation: 1190. Count)/FIPS: ~o65 Agency Address: Well ID: SAME AS ABOVE 333334717050001 Use: UNUSED Depth: e3.0O Latitude: 33.559444444444 Longitude: -117.0833333333 Surface Elevation: 740~. Date Well Drilled: 0~/0~/~950 Count), FIPS: 6065 Ii Agency Address: SAME AS ABOVE Well ID: a33232~?06450~ Use: UNUSED Depth: Latitude: 33.542222222222 Loncjitude: -~ ~ 7. 7 ~25 Surface Elevation: ~ 175, Static Water LeveE: County FIPS: 5055 * VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Vernon 2.6.1 Page #10 D ~!~Z~ ..... ~USGS:~ut/ATEP.:iW.E£1~iID:.~333235~!7:064701::.; i:vISZA!Ip#:::!::i;::;i:~::;~:;~: 1:8¢4628~:::~:: ....... : ~:~I:.~W A~:: :: ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: USGS:WelI~ ~b~rbi b~inkin~Wm~rSource~S~e538~ EPA/AgeDly D; N/A' Agency Address: SAME AS ABOV~ Well I D: 3332351 ~ 706470 ~ Jse: IRRIGATION Depth: 675,0 Latitude: 33.543055555555 Longitude: -77 7.1736556566 Sur[ace Elevation: 1760. Static Water Level: Date Well Drilled: o7/o7/7962 County FIPS: 6065 USGS W~I ~ 4 F~d~r~ ~n~q water so~ce~ ~ SRC~ 538~ IEPAtAgBnc~ID!: IN/A: Agency Address: SAME AS ABOVE Well ID: 333343117050001 Latitude: 33.561944444444 Longitude: .717.0833333333 Sur[ace Elevation: 1375. County FIPS: ~065 USGS Wells F F~d~;al Drinkinq watei S0~rces 1: SRC:~ 5384:: ; IERA/Ag~' !~ii; I N~A ::i:. Agency Address: SAME AS ABOVE Well ID: 333346117050301 Use: UNUSED Depth: 26.06 Latitude: 33.562777777777 Longitude: - 117,0841666666 Sur[ace Elevation: 7375, Date Well Drilled: o?/o?/19~o Count), FIPS: 6o66 · VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Verdon 2.6.1 Page #11 uSGS W~iB ~ F~d~r~iiDrinkinq water soBrce~/SRO# $384 Agency Address: Well ID: SAME AS ABOVE 333347777045901 Latitude: 33.553055555555 Longitude: -717.0830555555 Surface Elevation: 7375. Date Well Drilled: o7/o7/195o Count)' FIPS: B05S Agency Address: Well ID: SAME AS ABOVE 333245117065601 Latitude: 33.545833333333 Longitude: .777, 7155555555 Surface Elevation: 7200. County FIPS: 5055 usGS we s ~ F~derA Orihk nq W~ter source~/SRC~ 5384: : IEPA/Agenb Ag ency Address: SAME AS ABOVE Well ID: 333149117050401 Use: UNUSED Depth: 905.0 Latitude: 33.53 Longitude: - 117.0844444444 Surface Elevation: 1370. Static Water Level: 246.00 Date Well Drilled: o7/o7/796~ Count)' FIPS: 6o55 US~ W~ii~ ~ F~d~r~i Drinkinq w~ter Sodrce~ / SRC~ 5384 EPA/Agency: D N/A : i : Agency Address: Well ID: Use.' SAME AS ABOVE 333405717063301 STOCK · VISTA address includes enhanced city and ZIP, For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2,6.7 Page #72 Depth: 63.0o Latitude: 33.568055555555 .on~]itude: - ? 17.1091666666 Surface Elevation: ?3?5. Date Well Drilled: 0?/o?/?95o ~ount~/FIPS: 6o65 [ No Records Found J * VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6. ? Page #13 :5~t¥1sWLFi:iic6dnt~iS~iid!w~iLbndfill:/SRC#i38027iiiii!i;i ?ii?l!AgendyiIDJ!!~ i;ii i/iliDA~0iiiii!ii!iiiiii!iiiil;ii?~ Agency Address: SAME AS ABOVE Facility Type: NOTAVAILABLE Facility Status: NOTAVAILABLE Permit Status: NOTAVAILABLE ~ATE$~-S~lidWast~Lahdfili/SRC#5689 ~ Agency Address: Facilit7 Type: Facility Status: Permit Status: TEMECULA RAINBOW CANYON RD, TBS BZ~W TEMECULA, CA SOLID WASTE DISPOSAL FACILITY CLOSED OTHER Agency Address: SAME AS ABOVE Solid Waste Inventor~ System ID: NOTREPORTED Facility Type: Not repot[ed Facility In State Board Waste Discharger NO System: Chapter 15 Facility: NO ;olid Waste Assessment Test Facility: NO I'oxic Pits Cleanup Act Facility: NO RCRA Facility: NO Department of Defense Facility: NO Open To Public: NO Number Of Waste Management Units: Rank: 14 Enforcements At Facility: NO Violations At Facility: NO * VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6.1 Page/114 I ==:: ... :/, L!NMAPPED:SITES CON,J! i WMUDS/'SRC#S368 i' :~ : . .i .':' .. AgeneylD~ : 9000000488 . . Agency Address: SAME AS ABOVE Solid Waste Inventory System ID: NOT REPORTED Facility Type: SOLID WASTE SITES-CLASS Iii - Landfills for nonhazardous solid wastes Facility In State Board Waste Discharger NO System: Chapter 15 Facility: NO Solid Waste Assessment Test Facility: NO Toxic Pits Cleanup Act Facility: NO RCRA Facility: NO Department of Defense Facility: NO Open To Public: NO Number Of Waste Management Units: 1 R a nE: NOT REPORTED Enforcements At Facility: NO Violations At Facility: YES Agency Address: SAME AS ABOVE Facility ID: 8a124 Remediation Status: CLOSED/ACTION COMPLETED Media Affected: SOIL ONLY IS IMPACTED Description / Comment: EMPLOYEE ID: 3 ~ATEiLUST ~ St~[~iL~aking Und~tgi0Und stor~ l'~nl( ~ SRc# EPA/Agenc~ ID~ :N/A. : Agency Address: rR/ WEST/PACIFIC 50D 45620 PA~ RD E ~NCHO CALEORNIA. CA 92390 Facility ID: 9UT1418 Leak Report Date: 0?/05/68 Site Assessment Plan Submitted: 07/06/88 Site Assessment Began: Case Closed Date: 05/18/99 Substance: UNLEADED GASOLINE Remediafion Event: EXCAVATEAND TREAT Remediafion Status: CASE CLOSED Media Affected: SOtL ONLY Region / District: SAN DIEGO REGION i Description / Comment: COUNTY: RIVERSIDE Description / Comment: REVIEW DATE:07/29/93 ' VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Ve~on 2,6,1 Page #15 · Agency Address: rRI WEST/PACIFIC 500 45820 PALA RD E RANCHO CALIFORNIA, CA 92390 Facility ID: 9ur7418 Leak Date: 07/05/88 Leak Report Date: 07/08/88 ite Assessment Began: 12/01/88 Case Closed Date: 05/18/89 Leak Detection Method: TANK CLOSURE Leak Cause: UNKNOWN Leak Source: UNKNOWN Substance: UNLEAD GASOL Remediation Event: EXCAVATE AND TREAT Remediation Event: LEAK STOPPED BY: CLOSE TANKLEAK STOP DARE: 07/05/88 Remediation Status: CASE CLOSED Media Affected: SOIL ONLY Description / Comment: LOCASENUM: 88-412, BASINNUM:,GWDEPTH: ' VISTA address includes enhanced city and ZIP. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6.1 Page//16 SITE ASSESSMENT"BLUS REPORT (EXTE N DED :BY :MILLE) DESCRIPTION:OF :DATABASES SEARCHED NPL VISTA conducts a database search to identify all sites within 2. mile of your property. SRC#: 5593 SPL SRC#: 5455 CORRACTS SRC#: 5596 The agency release date for NPL was February, 1999. The National Priorities List (NPL) is the EPA's database of uncontrolled or abandoned hazardous waste sites identified for priority remedial actions under the Superfund program. A site must meet or surpass a predetermined hazard ranking system score, be chosen as a state's top priority site, or meet three specific criteria set jointly by the US Dept of Health and Human Services and the US EPA in order to become an NPL site. VISTA conducts a database search to identify all sites within 2. mile of your property. The agency release date for Calsites Database: Annual Workplan Sites was October, 1998. The CalSites database contains information on properties (or "sites") in California where hazardous substances have been released, or where the potential for such a release exists. This database is used primarily by the Department of Toxic Substances Control to evaluate and track activities at sites that may have been affected by the release of hazardous substances, Also see SPL/SCL: Annual Work Plan (AWP) sites are cleassified as SPt and all the other sites are classified as SCL. VISTA conducts a database search to identify all sites within 2. mile of your property. The agency release date for HWDMS/RCRIS was February, 1999. The EPA maintains this database of RCRA facilities which are undergoing "corrective action". A "corrective action order" is issued pursuant to RCRA Section 3008 (h) when there has been a release of hazardous waste or constituents into the environment from a RCRA facility. Corrective actions may be required beyond the facility's boundary and can be required regardless of when the release occurred, even if it predates RCRA. CERCLIS SRC#: 5594 VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for CERCLI$ was January, 1999. The CERCLIS List contains sites which are either proposed to or on the National Priorities List(NPL) and sites which are in the screening and assessment phase for possible inclusion on the NPL. The information on each site includes a history of all pre-remedial, remedial, removal and community relations activiies or events at the site, financial funding information for the events, and unrestricted enforcement a ctJvities. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Ve~on 2.6, ? Page #? 7 Cai Cerclis SRC#: 2462 NFRAP SRC#: 5595 SCL SRC#: 5454 RCRA-TSD SRC#: 5596 SWLF SRC#: 5689 VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Ca Cerclis w/Regional Utility Description was June, 1995. This database is provided by the U.S. Environmental Protection Agency, Region 9. The agency may be contacted at:. These are regional utility descriptions for California CERCLIS sites. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for CERCLIS-NFRAP was January, 1999. NFRAP sites may be sites where, following an initial investigation, no contamination was found, contamination was removed quickly, or the contamination was not serious enough to require Federal Superfund action or NPL consideration. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Calsites Database: All Sites except Annual Workplan Sites (incl. ASPIS) was October, 1999. The CalSites database contains information on properties (or "sites") in California where hazardous substances have been released, or where the potential for such a release exists. This database is used primarily by the Department of Toxic Substances Control to evaluate and track activities at sites that may have been affected by the release of hazardous substances. Also see SPL/SCL: Annual Work Plan (AWP) sites are cleassified as SPL and all the other sites are classified as SCL. The CaISites database includes both known and potential sites, Two- thirds of these sites have been classified, based on available information, as needing "No Further Action" (NRA) by the Department of Toxic Substances Control. The remaining sites are in various stages of review and remediation to determine if a problem exists at the site. Several hundred sites have been remediated and are considered certified. Some of these sites may be in long term operation and maintenance. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date I'or HWDMS/RCRIS was February, 1999. The EPA's Resource Conservation and Recovery Act (RCRA) Program identifies and tracks hazardous waste from the point of generation to the point of disposal. The RCRA Facilities database is a compilation by the EPA of facilities which report generation, storage, transportation, treatment or disposal of hazardous waste. RCRA TSDs are facilities which treat, store and/or dispose of hazardous waste, VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date I~or Ca Solid Waste Information System (SWIS) was December, 1998. This database is provided by the Integrated Waste Management Board. The agency may be contacted at: 916-255-4021. The California Solid Waste information System (SWIS) database consists of both open as well as closed and inactive solid waste disposal facilities and transfer stations pursuant to the Solid Waste Management and Resource Recovery Act of 1972, Government Code Section 2.66790(b). Generally, the California integrated Waste Management Board learns of locations of disposal facilities through permit applications and from local enforcement agencies. For more information call VISTA information Solutions, Inc. at 1 - 800 ~ 76'/- 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6. 7 Page Riverside County Landfill SRC#: 3802 WMUDS SRC#: 5368 LUST SRC#: 5116 LUST SRC#: 5366 LUST SRC#: 5448 LUST SRC#: 5452 LUST SRC#: 5497 VISTA conducts a database search to identify ali sites within 1.5 mile of your property. The agency release date for Exempt Site Inventor] List within Riverside County was March, 1997. This database is provided by the Riverside Department of Health, Local Solid Waste Enforcement Agency. The agency may be contacted at: 909-955-8982. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Waste Management Unit Database System 0NMUDS) was October, 1998. This database is provided by the State Water Resources Control Board. The agency may be contacted at: 916-892-0323. This is used for program tracking and inventory of waste management units. This system contains information from: Facility, Waste Management Unit, SWAT Program and Report Summary information, Chapter 15 (formerly Subchapter 15), TPCA and RCRA Program Information, Closure Information; also some information from the WDS (Waste Discharge System). The WMUDS system also accesses information from the following databases from the Waste Discharger System (WDS): Inspections, Violations, and Enforcements. The sites contained in these databases are subject to the California Code of Regulations - Title 23. Waters. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date [or Region #8-SLIC List was June, 1998. This database is provided by the Regional Water Quality Control Board, Region #8. The agency may be contacted at: 909-782-4499. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Region #7-Colorado River Basin Leaking Underground Storage Tank Listing was August, 1998. This database is provided by the Regional Water Quality Control Board, Region #7. The agency may be contacted at: 760-346-7491. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Riverside County-Listing of Underground Tank Cleanup Sites was October, 1998. This database is provided by the Riverside County Environmental Health Department, Haz Mat Division. The agency may be contacted at: 909-358-5055. VISTA conducts a database search to identify ali sites within 1.5 mile of your property. The agency release date for Region #8-Santa Ana Regional Underground Tank Database List was October, 1998. This database is provided by the Regional Water Quality Control Board, Region #8. The agency may be contacted at: 909-782-4499. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Lust Information System (LUST:S) was October, 1998. This database is provided by the California Environmental Protection Agency. The agency may be contacted at: 916-445-6532. For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2,6.1 Page #19 LUST SRC#: 5670 LUST SRC#: 5671 CORTESE SRC#: 4840 VISTA conducts a database search to identiflJ all sites within 1.5 mile of your property. The agency release date for lahontan Region LUST List was January, 1999. This database is provided by the Lahontan Region Six South Lake Tahoe. The agency may be contacted at: 916-542-5400, VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Region #9 Leaking Underground Storage Tank List was December, 1998. This database is provided by the Regional Water.Quality Control Board, Region #9. The agency may be contacted at: 619-467-2975. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Cortese List-Hazardous Waste Substance Site List was April, 1998. This database is provided by the Office of Environmental Protection, Office of Hazardous Materials. The agency may be contacted at: 916-445-6532. The California Governor's Office of Planning and Research annually publishes a listing of potential and confirmed hazardous waste sites throughout the State of California under Government Code Section 65962.5. This database (CORTESE) is based on input from the following: (1)CALSITES-Department of Toxic Substances Control, Abandoned Sites Program Information Systems; (2)SARA Title III Section III Toxic Chemicals Release Inventory for 1987, 1988, 1989, and 1990; (3)FINDS; (4) HWlS-Department of Toxic Substances Control, Hazardous Waste Information System. Vista has not included one time generator facilities from Cortese in our database.; (5)SWRCB-State Water Resources Control Board; (6)SWlS-Integrated Waste Management Control Board (solid waste facilities); (7)AGT25-Air Resources Board, dischargers of greater than 25 tons of criteria pollutants to the air; (8)A1025-Air Resources Board, dischargers of greater than 10 and less than 25 tons of criteria pollutants to the air; (9)LTANK-SWRCB Leaking Underground Storage Tanks; (10)UTANK-SWRCB Underground tanks reported to the SWEEPS systems; (11)lUR-lnventory Update Rule (Chemical Manufacturers); (12)WB-LF-Waste Board - Leaking Facility, site has known migration; (13)WDSE-Waste Discharge System - Enforcement Action; (14)DTSCD-Department of Toxic Substance Control Docket. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Ve~on 2.6.1 Page #20 Deed Restrictions SRC#: 1703 Toxic Pits SEC#: 2229 Water Wells SRC#: 5384 VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date [or Deed Restriction Properties Report was April, 1994. This database is provided by the Department of Health Services-Land Use and Air Assessment. The agency may be contacted at: 916-323-3376. These are voluntary deed restriction agreements with owners of property who propose building residences, schools, hospitals, or day care centers on property that is "on or within 2,000 feet of a significant disposal of hazardous waste". California has a statutory and administrative procedure under which the California Department of Health Services (DHS) may desigrtate real property as either a "Hazardous Waste Property" or a "Border Zone Property" pursuant to California Health Safety Code Sections 25220-25241. Hazardous Waste Property is land at which hazardous waste has been deposited, creating a significant existing or potential hazard to public health and safety. A Border Zone Property is one within 2,000 feet of a hazardous waste deposit. Property within either category is restricted in use, unless a written variance is obtained from DHS. A Hazardous Waste Property designation results in a prohibition of new uses, other than 8 modification or expansion of an industrial or manufacturing facility on land previously owned by the facility prior to January 1, 1981. A Border Zone Property designation results in prohibition of a variety of uses involving human habitation, hospitals, schools and day care center. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for Summa~/of Toxic Pits Cleanup Facilities was February, 1995. This database is provided by the Water Quality Control Board, Division of Loans Grants. The agency may be contacted at: 916-227-4396. VISTA conducts a database search to identify all sites within 1.5 mile of your property. The agency release date for USGS WATER WELLS was March, 1998. The Ground Water Site Inventory (GWSI) database was provided by the United States Geological Survey (USGS). The database contains information for over 1,000,000 wells and other sources of groundwater which the USGS has studied, used, or otherwise had reason to document through the course of research. The agency may be contacted at 703-648-6819. RCEA-Viols/Enf VISTA conducts a database search to identify all sites within 1.25 mile of your property. The agency release date for I-IWBM$/RCRIS was Februanj, 1999. The EPA's Resource Conservation and Recovery Act (RCRA) Program identifies and tracks hazardous waste from the point of generation to the point of disposal. The RCRA Facilities database is a compilation by the EPA of facilities which report generation, storage, transportation, treatment or disposal of hazardous waste. RCRA Violators are facilities which have been cited for RCRA Violations at least once since 1980. RCRA Enforcements are enforcement actions taken against RCRA violators. For more information call VISTA Information Solutions, Inc. at I - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6.1 Page #21 USI's SRO#: 1612 USI~s SRC#: 5451 ASI~s SRC#: 5513 VISTA conducts a database search to identify all sites within 1.25 mile of your property. The agency release date for Underground Storage Tank Registrations Database was January, 1994. This database is provided by the State Water Resources Control Board, Office of Underground Storage Tanks. The agency may be contacted at: 916-227-4337; Caution-Many states do not require registration of heatin§ oil tanks, especially those used for residential purposes, VISTA conducts a database search to identify alLsites within 1 .ZS mile of your property. The agency release date for Riverside County UST List was October, 1998. This database is provided by the Riverside County Environmental Health, The agency may be contacted at: 909-358-5055; Caution-Many states do not require registration of heatin9 oil tanks, especially those used for residential purposes. VISTA conducts a database search to identify all sites within 1.25 mile of your property. The a§ency release date for Aboveground Storage Tank Database was December, 1998. This database is provided by the State Water Resources Control Board. The agency may be contacted at: 916-227-4364. TRIS VISTA conducts a database search to identify all sites within 1.25 mile of your SRC#: 4946 property, The agency release date for TRIS was January, 1998. Section 313 of the Emergency Planning and Community Right-to-Know Act_ (also known as SARA Title III) of 1986 requires Lhe EPA to establish an inventory of Toxic Chemicals emissions from certain facilities( Toxic Release Inventory System). Facilities subject to this reporting are required to complete a Toxic Chemical Release Form(Form R) for specified chemicals. ERNS SRC#:4939 VISTA conducts a database search to identify all sites within 1.125 mile of your property. The agency release date [or was July, 1998. The Emergency Response Notification System (ERNS) is a national database containing records from October 1986 to the release date above and is used to collect information for reported releases of oil and hazardous substances. The database contains information from spill reports made to federal authorities including the EPA, the US Coast Guard, the National Response Center and the Department of Transportation. The ERNS hotline number is (202) 260-2342. For more information call VISTA InformaLion Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Version 2.6. I Page #22 RCRA-LgGen SRC#: 5596 RCRA-SmGen SRC#: 5596 VISTA conducts a database search to identify all sites within 1.125 mile of your property. The agency release date for HWDM$/RCEIS was February, 1999. The EPA's Resource Conservation and Recovery Act (RCRA) Program identifies and tracks hazardous waste from the point of generation to the point of disposal. The RCRA Facilities database is a compilation by the EPA of facilities which report generation, storage, transportation, treatment or disposal of hazardous waste. RCRA Large Generators are facilities which generate at least 1000 kg./month of non-acutely hazardous waste ( or 1 kg./month of acutely hazardous waste). VISTA conducts a database search to identify all'sites within 1.125 mile of your property. The agency release date for HWDMS/RCRIS was February, 1999. The EPA's Resource Conservation and Recovery Act (RCRA) Program identifies and tracks hazardous waste from the point of generation to the point of disposal. The RCRA Facilities database is a compilation by the EPA of facilities which report generation, storage, transportation, treatment or disposal of hazardous waste. RCRA Small and Very Small generators are facilities which generate less than 1000 kg./month of non-acutely hazardous waste. For more information call VISTA Information Solutions, Inc. at 1 - 800 - 767 - 0403. Report ID: 993070001 Date of Report: June 9, 1999 Vernon 2.6.1 Page #23 !1 Pacific Treatment 4340 Viewridge Avenue, Suite A · San Diego, CA 92123 Analytical Services, Inc. (619) 560-7717 · Fax (619) 560-7763 Analytical Chemistry Laboratory June 8, 1999 Gradient Engineers, Inc. At-tn: Molly Hennessey 3934 Murphy Canyon Road, Suite B204 San Diego, California 92123 Project/qame/No.: Roripaugh Ranch Laboratory Log No.: 1073-99 Date Received: 06/02/99 Sample Matrix: Fifteen soil samples PO No.: 993070-001 Please find the following enclosures for the above referenced project identified: 1) Analytical Report 2) QA/QC Report 3) Chain of Custody Form ....................................................... Certificate of Analysis ...................................................... Samples were analyzed pursuant to client request utilizing EPA or other ELAP approved methodologies. Date of extraction, date of analysis, detection limits and dilution factor are reported for each compound analyzed. All samples were analyzed within the method required holding time fi.om sample collection. Data for each analytical method was evaluated by assessing the following QA/QC functions, as applicable to the methodology: · Quality Control Standard · Surrogate Percent Recovery · Laboratory Control Sample (LCS) percent recoveries for all analyses · Matrix Spike Recovery/Matrix Spike Duplicate Recovery (MSR & MSDR) and/or · Relative Percent Difference (RPD fi.om MSR & MSDR) I certify that this data report is in compliance both technically and for completeness. Release of the data contained in this hardcopy data report has been authorized by the following signature. ~oratory Director Water · Soil · Waste · Wastewater · Marine Sediment & Tissues · Elutriate Analyses That Produce Results! ANALYSIS RESULTS - EPA 8080 ORGANOCltLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, INC, PROJECT NAME/No.: RORIPAUGH RANCH PTAS LOG #: METHOD BLANK SAMPLE ID: N/A DILUTION FACTOR: 1 DATE SAMPLED: N/A DATE RECEIVED: N/A DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOLID SAMPLEVOL./WT.: 30 G ANALYTE ALDRIN ALPHA-BHC BETA-BHC GAMMA-BHC (LIN'DANE DELTA-BHC CHLORDANE DDD DDE DDT REPORTING LIMITS PPB (UG/KG) RESULTS PPB (UG/KG) DIELDRIN ENDOSULFAN I ENDOSULFAN II ENDOSULFAN/SULFATE ENDR1N ENDRIN ALDEHYDE HEPTACHLOR HEPTACHLOR EPOXIDE METHOXYCHLOR TOXAPHENE 2 ND 2 ND 2 ND 2 ND 2 ND 20 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 2 ND 20 ND 25 ND ND = ANAL'fiFE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. SURROGATE PARAMETER TCMX ACCEPTABLE RECOVERIES 26-146 % RECOVERY 98 I Pacific Treatment Analytical Ser~fces, Inc. 4340 Viewddge Ave., Suite A* San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, 1NC. PROJECT NAMEfNo.: ROR1PAUGH RANCH PTAS LOG #: 1073-99-1 SAMPLE ID: SI-I' DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRLX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS PPB (UG/KG) RESULTS PPB CLIG/KG) ALDRIN 2 ND ALPHA-BHC 2 ND BETA-BHC 2 ND GAMMA-BHC 2 ND DELTA~BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE · 2 ND 4,4-DDT · . 2 ND DIELDR/N 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDRIN 2 ND ENDRIN ALDEHYDE 2 ND HEPTACHLOR 2 ND HEPTACHLOR EPOXIDE 2 ND METHOXYCHLOR 20 ND TOXAPHENE 25 ND ND-- ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIMITS AND RESULTS HAVE BEEN ADIUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. SURROGATE PARAMETER TCMX ACCEPTABLE RECOVERIES 26-146 % RECOVERY 95 I Pacific Treatment Analytical Services, Inc. 4340 Vievaldge Ave., Suite A · San Diego. CA 92123 (619) 560-7717 FAX (619) 5604163 ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, INC. PROJECT NAME/No,: RORIPAUGH RANCH PTAS LOG #: 1073-99-2 SAMPLE ID: S2-1' DILUTION FACTOR: I DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS PPB (UG/KG) RESULTS PPB (UG/KO) ALDRIN 2 ND ALPHA-BHC 2 ND BETA-BHC 2 ND GAMMA-BHC 2 ND DELTA-BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE 2 ND 4,4~DDT 2 ND DIELDRIN 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDILIN 2 ND ENDKIN ALDEHYDE 2 ND HEPTACH~,OR 2 ND HEPTACHLOR EPOXIDE 2 ND METHOXYCHLOR 20 ND TOXAPI-~NE 25 ND ND -- ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIM1TS AND RESULTS HAVE BEEN ADJUSTED ACCORDiNGLY TO ACCOUNT FOR DILUTION FACTOR, SURROGATE PARAMETER TCMX ACCEPTABLE RECOVERIES 26-146 % RECOVERY 88 I Pacific Treatment Analytical Servfces, Inc. 4340 Viewddge Ave., SuRe A- San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, INC. PROIECT NAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-2 (DUPLICATE) SAMPLE ID: S2-1' (DUPLICATE) DILUTION FACTOR: I DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS PPB (UG/KG) RESULTS PPB (UG/KG) ALDRIN 2 ND ALPHA-BHC 2 ND BETA-BHC 2 ND GAMMA-BHC 2 ND DELTA-BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE 2 ND 4,4-DDT 2 ND DIELDRIN 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDRiN 2 ND ENDRIN ALDEHYDE 2 ND HEPTACHLOR 2 ND HEPTACHLOR EPOXIDE 2 ND METHOXYCHLOR 20 ND TOXAPHENE 25 ND ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILLrrlON FACTOR. SURROGATE PARAMETER TCMX ACCEPTABLE RECOVERIES 26-146 % RECOVERY 96 II I Pacific Treatment Analytical Servfces, Inc. 4340 Viewdage Ave., Suite A- San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 [I ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, INC. PROJECTNAME/No.: ROKIPAUGH RANCH PTAS LOG #: 1073-99-5 SAMPLE ID: S5-I' DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS PPB (UG/KG) RESULTS PPB (UG/KG) ALDRIN 2 ND ALPHA-BHC 2 ND BETA~BHC 2 ND GAM]Vaa,-BHC 2 ND DELTA-BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE 2 ND 4,4-DDT 2 ND DIELDRIN 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDRIN 2 ND ENDRIN ALDEHYDE 2 ND HEPTACHLOR 2 ND HEPTACHLOR EPOXIDE 2 ND METHOXYCHLOR 20 ND TOXAPHENE 25 ND ND ~ ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. SURROGATE PARAMETER TCIv[X ACCEPTABLE RECOVERIES 26-146 % RECOVERY 98 II I I Pacific Treatment Analytical Services, Inc. 4340 Viewridg, Ava., SHe A. San Diego, CA 92123 (619) 560-7717 FAX (619) 5604763 ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT ENGINEERS, INC. PROYECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-6 SAMPLE ID: S6-I' DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS PPB (UG/KG) RESULTS PPB (UG/KG) ALDRIN 2 ND ALPHA-BHC 2 ND BETAoBHC 2 ND GAMMA-BHC 2 ND DELTA-BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE 2 ND 4,4-DDT 2 ND DIELDRIN 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDRIN 2 ND ENDRIN ALDEHYDE 2 ND HEPTACHLOR 2 ND HEPTACHLOR EPOXIDE 2 ND METHOXYCHLOR 20 ND TOXAPHENE 25 ND ND -- ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTI~IG LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. SURROGATE PARAMETER TCMX ACCEPTABLE RECOVERIES 26-146 % RECOVERY 95 I I Pacific Treatment Analytical Sert4ces, Inc. 4340 VJewr~dge Ave., Suite A · San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - EPA 8080 ORGANOCHLORINE PESTICIDES CLIENT: GRADIENT.ENGINEERS, INC. PROJECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-7 SAMPLE ID: S7-U DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/04/99 MATRIX: SOIL SAMPLE VOL./WT.: 30 G ANALYTE REPORTING LIMITS RESULTS PPB (UG/KG) PPB (UG/KG) ALDRIN 2 ND ALPHA-BHC 2 ND BETA-BHC 2 ND GAMMA-BHC 2 ND DELTA-BHC 2 ND CHLORDANE 20 ND 4,4-DDD 2 ND 4,4-DDE 2 ND 4,4-DDT 2 ND DIELDRIN 2 ND ENDOSULFAN I 2 ND ENDOSULFAN II 2 ND ENDOSULFAN SULFATE 2 ND ENDRIN 2 ND ENDRIN ALDEHYDE 2 ND HEPTACHLOR 2 ND H~PTACHLOR EPOXIDE ~ 2 ND METHOXYCHLOR 20 ND TOXAPHENE 25 ND ND = ANALY'rE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR~ SURROGATEPARAMETER TC/vD( ACCEPTABLE RECOVERIES 26-146 % RECOVERY 101 I Pacific Treatment A~alytleal ~er~fcee, Inc. 434o Viewddge Ave., Suite A · San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 QA/QC REPORT METHOD: EPA 8080-SOIL ACCEPTABLE ACCEPTABLE DATE ANALYZED: 06/04/99 LCS,MS/MSD RPD !QA/QC SAMI~LE: 1073-99-2 CRITERIA CRITERIA gPIKED ANALYTE LCS % R MS % R MSD % R RPD % % ,~AMMA-BHC 99 95 93 2 32-127 <30 HEPTACHLOR 99 98 96 2 34-111 <30 ALDRIN 87 85 85 0 42-122 <30 DIELDRIN 108 108 108 0- 36-146 <30 ENDRIN 127 100 98 2 30-147 <30 ¢,4-DDT 110 119 115 3 25-160 <30 LCS % R = LABORATORY CONTROL SAMPLE PERCENT RECOVERY MS % R = MATRIX SPIKE PERCENT RECOVERY MSD % R = MATRIX SPIKE DUPLICATE PERCENT RECOVERY RPD -- RELATIVE PERCENT DIFFERENCE Pacific Treatment Analytical Services, Inc. 4340 Viewridge Ave., Su~ A. San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROJECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: METHOD BLANK CLIENT SAMPLE ID: N/A DILUTION FACTOR: 1 DATE SAMPLED: N/A DATE RECEIVED: N/A DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/02/99 MATRIX: SOLID SAMPLE VOL./WT.: 10 G ~ ANALYTE C8 $ HC C8 -< HC < C9 C9 < HC < CIO C10 _< HC < Cll Cll _< HC < C12 C12 < HC < C14 C14 < HC < C16 C16 < HC < C18 C18 < HC < C20 C20 < HC < C24 C24 < HC < C28 C28 < HC C32 < C32 -< HC < C36 C36 < HC < C40 i C40 < HC REPORTING LIMITS PPM (MG/KG) RESULTS PPM (MO/KG) ND ND ND ND ND ND ND ND ND ND ND ND ND ND ND TOTAL HC ND TPH IDENTIFICATION: NONE HC ~ HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT, REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. Pacific Treatment Analytical Servfces, Inc. 4340 View~clge Ave.. Suite A o San Diego. CA 92123 (619) 560-7717 (619) 5604163 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROJECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-8 CLIENT SAMPLE ID: SSI-2" DILUTION FACTOR: 1 ANALYTE REPORTING LIMITS PPM 0VIG/KG) -< HC -( HC < C9 < HC < C10 i -<HC < CI1 -< HC < C12 -< HC < C14 -< HC < C16 -< HC < C18 -< HC < C20 < HC < C24 < HC < C28 < HC < C32 -< HC < C36 C36 < HC < C'~0 CA0 < HC TOTAL HC 1 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = t REPOI DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/02/99 MATRIX: SOIL SAMPLE VOL./WT.: 10 G RESULTS PPM (MG/KG) ND ND ND ND ND ND 1 4 6 13 60 180 101 81 37 483 HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. Pacific Treatment Analytical Ser~fces, Inc. 4340 Vievntdge Ave., Suite A * San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 § ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROJECTNAMEJNo.: P,.ORIPAUGH RANCH PTAS LOG #: 1073-99-9 CLIENT SAMPLE ID: SS2-2" DILUTION FACTOR.: 10 DATE SAMPLED: DATE RECEIVED: DATE EXTRACTED: DATE ANALYZED: MATRIX: SAMPLE VOL/WT.: 06/01/99 06/02/99 06/02/99 06/03/99 SOIL 10G ANALYTE REPORTING LIMITS PPM (MG/KG) RESULTS PPM (MG/KG) C8 < HC 10 ND C8 _< HC < C9 10 ND C'9 < HC < C10 10 ND C10 -< HC < Cll 10 ND Cll < HC < C12 10 ND C12 < HC < C14 10 ND C14 < HC < C16 10 11 C16 -< HC < C18 10 40 C18 < HC < C20 10 126 C20 _< HC < C24 10 276 C24 _< HC < C28 10 1,560 < < 10 770 C28 HC C32 C32 _< HC < C36 10 220 C36 < HC < CA0 10 200 CA0 < HC 10 70 TOTAL HC 10 3,570 'rPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. I ~Pacific Treatment Analytical Servfces, Inc. 4340 Viewddge Ave., Suite A · San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, 1NC. PROJECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-10 CLIENT SAMPLE ID: SS3-1" DILUTION FACTOR: 5 DATE SAMPLED: DATE RECEIVED: DATE EXTRACTED: DATE ANALYZED: MATRIX: SAMPLE VOL./WT.: ANALYTE REPORTING LIMITS RESULTS 06/01/99 06/02/99 06/02/99 06/03/99 SOIL 10G PPM (MG/KG) PPM (MG/KG C8 _< HC 5 ND C8 -< HC < C9 5 13 C9 < HC < C10 5 ND C10 < HC < Cll 5 ND Cll < HC < C12 5 7 C12 < HC < C14 5 6 C14 < HC < C16 5 10 C16 < HC < C18 5 13 C18 < HC < C20 5 7 C20 _< HC < C24 5 12 C24 < HC < C28 5 85 C28 _< HC < C32 5 265 C32 < HC < C36 5 287 C36 < HC < C40 5 298 < HC 5 230 C40 TOTAL HC 5 1,230 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. ~Pacific Treatment Analytical Servfces, Inc. 4340 Viewridge Ave.. SuiteA.San Diego, C^92123 (619) 560-7717 FAX (619) 560-7763 D ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROIECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-11 CLIENT SAMPLE ID: SS4-I' DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/02/99 MATRIX: SOIL SAMPLE VOL./WT.: 10 G ANALYTE REPORTING LIMITS RESULTS C8 _< HC C8 < HC < C9 C9 < HC < CI0 C10 _< HC < CII I Cll < HC < C12 C12 < HC < C14 C14 < HC < C16 C16 < HC < C18 ;~:~ C18 < HC < C20 C20 < HC < C24 C24 -< HC < C28 [=] C28 < HC < C32 C32 < HC < C36 C36 < HC < C40 I CA0 < HC PPM (MG/KG) PPM (MG/KG) ND ND ND ND ND ND 2 12 39 39 34 48 25 26 24 TOTAL HC 249 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. Pacific Treatment Analytical Services, Inc. 434o View~'ieoe Ave., Suite A,,.San [:)iego. CA 921;'3 (6'~9) $60-7717 FAX (619) 560-7763 Ii ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROJECT NAMEfNo.: RORIPAUGH RANCH PTAS LOG #: I073-99-12 CLIENT SAMPLE ID: SS5-3" DILUTION FACTOR: 1 DATE SAMPLED: DATE RECEIVED: DATE EXTRACTED: DATE ANALYZED: MATRIX: SAMPLE VOL/WT.: 06/01/99 06/02/99 06/02/99 06/02/99 SOIL 10G ~ ANALYTE REPORTING LIMITS RESULTS PPM (MG/KG) PPM (MG/KG) C8 < HC 1 ND C8 -< HC < C9 1 ND C9 < HC < C10 1 ND C10 < HC < Cll 1 ND Cll < HC < C12 1 ND C12 < HC < C14 1 ND C14 < HC < C16 1 ND C16 < HC < C18 1 ND C18 < HC < C20 1 ND C20 < HC < C24 1 2 C24 < HC < C28 I 15 C28 < HC < C32 1 68 C32 _< HC < C36 I 23 C36 < HC < C40 I 27 CA0 < HC 1 18 TOTAL HC I 153 TPH DENTIFICATION: WASTE OIL II HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADYUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. Pacific Treatment Analytical Services, Inc. 4340 Viewddge Ave., Suite A- San Diego. CA 92123 (619) 5604717 FAX (619) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROJECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-13 CLIENT SAMPLE ID: SS6-2" DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/03/99 MATRIX: SOIL SAMPLE VOL./WT.: 10 G ~ ANALYTE C8 -< HC C$ < HC < C9 C9 < HC < C10 C10 < HC < Cll Cll < HC < C12 C12 < HC < C14 C14 < HC < C16 C16 -< HC < C18 C18 < HC < C20 C20 -< HC < C24 C24 _< HC < C28 C28 < HC < C32 C32 < HC < C36 C36 < HC < CA0 CA0 < HC REPORTING LIMITS PPM (MG/KG) RESULTS PPM (MG/KG) ND ND ND ND 11 ND ND 5 2 3 2 27 9 4 6 TOTAL HC 69 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALYrE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORJDINGLY TO ACCOUNT FOR DILUTION FACTOR. II Pacific Treatment Analytical Ser~4ces, Inc. 4340 ~ewridge Ave., Suite ^. San Diego, CA 92123 (619) 560-7717 FAX (61 g) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, INC. PROYECTNAME/No.: RORIPAUGH RANCH PTAS LOG #: 1073-99-13 (DUPLICATE) CLIENT SAMPLE ID: SS6-2" (DUPLICATE) DILUTION FACTOR: DATE SAMPLED: DATE RECEIVED: DATE EXTRACTED: DATE ANALYZED: SAMPLE VOL/WT.: ANALYTE REPORTING LIMITS RESULTS 06/01/99 06/02/99 06/02/99 06/03/99 SOIL 10G C8 < HC C8 < HC < C9 C9 < HC < C10 C10 -< HC < Cll Cll _< HC < C12 C12 -< HC < C14 C14 < HC < C16 C16 < HC < C18 C18 < HC < C20 C20 < HC < C24 C24 < HC < C28 C28 < HC < C32 C32 < HC < C36 C36 < HC < C40 < HC CA0 PPM (MC/KG) PPM (IVlG/KG) ND ND ND ND 5 ND ND 4 1 2 ND 36 5 4 4 TOTAL HC 61 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALY'rE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILUTION FACTOR. Pacific Treatment Analytical SerWces, Inc. 4340 View~iage Ave., Suite A · San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, 1NC. PROJECT NAMEfNo.: ROR/PAUGH RANCH PTAS LOG #: 1073-99-14 CLIENT SAMPLE ID: SS7-4" DILUTION FACTOR: 1 DATE SAMPLED: DATE RECEIVED: DATE EXTRACTED: DATE ANALYZED: SAMPLE VOL./WT.: 06/01/99 06/02/99 06/02/99 06/03/99 SOIL 10G ~ ANALYTE REPORTING LIMITS PPM (MG/KG) RESULTS PPM (MG/KG) C8 < HC I ND C8 < HC < C9 I ND C9 < HC < C10 1 ND C10 < HC < Cll 1 ND B CI! -< HC < C12 I ND C12 -< HC < C14 I ND C14 < HC < C16 1 ND C16 < HC < C18 1 2 C18 < HC < C20 1 ND C20 < HC < C24 1 2 C24 _< HC < C28 1 11 C28 HC C32 61 _< 1 C32 < HC < C36 1 30 C36 < HC < C40 1 22 CAO _~ HC 1 13 TOTAL HC 141 TPH IDENTIFICATION: WASTE OIL HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDiNGLY TO ACCOUNT FOR DILLrF!ON FACTOR. ~ ~ Pacific Treatment Analytical Services, lnc. 4340Viewddge^ve.,SuiteA.SanDieoo. CA92123 (619)560-7717 FAX (619) 560-7763 ANALYSIS RESULTS - TPH EXTENDED RANGE BY ASTM D2887 CLIENT: GRADIENT ENGINEERS, 1NC, PROJECT NAMEfNo.: RORIPAUGH RANCH PTAS LOG #: 1073-99-15 CLIENT SAMPLE ID: SS8-3" DILUTION FACTOR: 1 DATE SAMPLED: 06/01/99 DATE RECEIVED: 06/02/99 DATE EXTRACTED: 06/02/99 DATE ANALYZED: 06/03/99 MATRIX: SOIL SAMPLE VOL./WT.: 10 G ANALYTE REPORTING LIMITS RESULTS PPM (MG/KG) PPM (MG/KG) C8 < HC 1 ND I C8 < HC < C9 1 ND C9 _< HC < C10 1 ND C10 < HC < Cll l ND I Ctl < HC < C12 l 2 C12 < HC < C14 1 ND C14 -< HC < C16 1 ND C16 < HC < C18 1 6 C18 _< HC < C20 1 14 C20 < HC < C24 1 16 C24 < ItC < C28 1 60 C28 < HC < C32 I 183 C32 -< HC < C36 1 116 C36 < HC < C40 1 101 I CA0 < HC 1 84 TOTAL HC 583 TPH IDENTIFICATION: WEATHERED DIESEL & WASTE OIL HC = HYDROCARBON ND = ANALYTE NOT DETECTED AT OR ABOVE THE INDICATED REPORTING LIMIT. REPORTING LIMITS AND RESULTS HAVE BEEN ADJUSTED ACCORDINGLY TO ACCOUNT FOR DILLrrlON FACTOR. Pacific Treatment Analytical Sert4ces, Inc. 4340 Viewddge Ave., Suite A- San Diego, CA 92123 (619) 560-7717 (619) 560-7763 QA/QC REPORT 1VIETHOD: TPH-ASTM D2887 ACCEPTABLE ACCEPTABLE LCS,MS/MSD RPD DATE ANALYZED: 06/02-03/99 CRITERIA CRITERIA DIESEL 96 62* 80 25 75-125 <30 LCS % R = LABORATORY CONTROL SAMPLE PERCENT RECOVERY MS % R = MATRIX SPIKE PERCENT RECOVERY MSD uA R = MATRIX SPIKE DUPLICATE PERCENT RECOVERY RPD = RELATIVE PERCENT D~FFERENCE * NOTE: POOR KECOVERY A'FTRIBUTABLE TO NON-HOMOGENEITY OF SAMPLE SPIKED. ALL OTHER QC DATA INDICATES METHOD IS IN CONTROL. Pacific Treatment Analytical Sert4ces, Inc. 4340 Viewridge Ave,, Suite A- San Diego, CA 92123 (619) 560-7717 FAX (619) 560-7763 993070-001 SITE PHOTOS PHOTO NO. 1: View facing east of a portable tank noted in the northern area of the Site. The Roripaugh residences are located in the background. Sample SSI-2" was collected adjacent to the tank, beneath the stained soil. PHOTO NO. 2: View of petroleum stained soil located in AOC 1. Sample SS5-3" was collected beneath this soil stained area. ~ ! 993070-001 SITE PHOTOS PHOTO No. 3: View of unlabeled containers located in Aec I, primarily containing what appeared to be w~te oil. Soil staining noted and sample SS6-2' was collected adjacent ~ ~e oneqhal£ 55-gallon dram in the center of the phew. PHOTO No. 4: View el'containers located in Aec I. The containers were unlabeled or labeled to contain oil or hydraulic fluid. Soil staining was noted in the area of the wooden pallet ~ocatcd in the left area of the photo. Soil sample SS7-4" was collected adjacent to the pallet bencatl~ the stained soil, 993070-001 PHOTO NO. 5: View of several containers located west of the worksho ~ located in AOC I. PHOTO NO. 6: View of two diesel ASTs located in AOC 1. Sample SS4-1' was collected beneath the stained soil ac[jacent to the nozzles. SITE PHOTOS 993070-001 r'? PHOTO No. 7: View facing north cfa pile of miscellaneous debris located at the east end of the airstrip in ACC 2. SITE PHOTOS PHOTO NO. 8: View facing southwest of debris located in the southeast area of thc airstrip in ACC 2. ' 993070-001 PHOTO No. 9: View of discarded tires located in the southeast ama of thc airstrip in Aec 2. PHOTO No. 10: View facing southwest of plane hangers in AOC 2. Note the unleaded fuel AST located in the central right area of the photo. SITE PHOTOS 993070-001 SITE PHOTOS PHOTO NO. 11: View of unlabeled 5-gallon containers located in AOC 2. Sample SS2-2" was collected beneath the stained soil adjacent to these containers. PHOTO NO. 12: View o£ shed and discarded rusted equipment parts located to the south o/'the airstrip in AOC 2. PHOTO NO. 13: View of discarded rusted equipment parts located to the south of the airstrip in AOC 2. SITE PHOTOS PHOTO No. 14: View of'debris and untabeled containers located to the south of the airstrip. Soil sample SS3-1' was collected beneath the $oi] staining. 993070-001 PHOTO NO. 15: ¥iew £~¢in~ southwest 01'disc~ded debris in¢]udin8 ASTs located in AOC ~. PHOTO NO. 16: Vic,z, ['acing south o['thc AST observed in thc southern area o£thc Sitc. SITE PHOTOS GRADIENT ENGINEERS,. . Construction Engineering ,~6 Environmenta/ Services June 1, 1999 Project No. 993070-001 To: Subject: Phase ][ Environmental Site Assessment Questionnaire, gOO-Acre Roripaugh Ranch, Murrieta, Riverside County, California Gradient Engineers, Inc., (Gradient) has been contacted by Ashby Development Company to perform a Phase I Environmental Site Assessment (ESA) at the subject site. Please take a few moments to fill out the attacbed questionnaire regarding the subject site. This form is pant of the ASTM Standard for Please I ESAs and will be included in our report. Some of the questions may not apply to your site but are included to conform with the ASTM Standard. If you do not know the answer, simply check the "Unknown (UNK.)" box. However, please be as thorough as possible. Please return the completed questionnaire by June 7, 1999, to our San Diego office by fax (619) 268-5199, and mail the original to this office. If you have any questions please do not hesitate to contact the undersigned at (619) 268-1320. I I § Thank you for your timely cooperation. Respectfully submitted, GRADIENT ENGINEERS INC. Staff Environmental Ei'Ig/rte~r Attachment: Phase I ESA Transaction Screen Questionnaire ~934 Murphy Canyon Road, Suite B204, San Diego, CA 92123 (619) 268-1320 ~c. # A734297 FAX (619) 268-5199 PHASE I ENVIRONMENTAL SITE ASSESSMENT TRANSACTION SCREEN QUESTIONNAIRE Property Owner: Phone No.: Project Number: Site Address: City: ] State: Q~I~__i : YES NO Lr/~l~ COMMENTS I. lstheproper~oranyadjoinlngproperO, usedforanindustfialuse?lf so, plcasc state which (subjcctproperty and/or a~jacentproperty) 2. To thc best of your knowlcdg¢, has fl~c property, or any adjoining property becn used for an indusnial use in thc past? If so, plcasc statc which (subject pro~erO' and/or adjacent proper(v) 3. Is thc property or any adjoining prot~rty, used ~ a gasoline station, motor repair facility, commercial printing facility, dry cleaner~, photo developing laboratory, junkyard or landfill, or a~ a waste t~atmcnt. storage, disposal, processing, or recycling facility? If so, please state 1 which (subject property and/or adjacent property) 4. To the best of your knowledge has the property, or any adjoining property been used as a gasoline station, motor repair facility. commercial printing facility, dry cleaner~, photo developing "~ laboratory, junkyard or landfill, or as a waste treatment, storage.,/ \ disposal, processing, or recycling facility? If so, please sta~ which (subject proper~ and/or adjacent property) $. Arc there curr~tly, or to thc best of your knowledge havc there be~n pr~vinusly, any damaged or discarded automotive or indostrial bat~ie~, or p~'ticidcs, paints, or othcr cl~micals in individual containers of grc, atar than 5 gal (19 L) in volume or 50 gal (190 L) in the, agg~gato, stool on or used at the property or at thc facility? 6. Ar~ there ,.,=~tly, or to the ~ of your knowledge have there b~n , ; pt~vinO~[y, any industrial drums (typically 55 gal. (208 L)) or sacks of chemical~ located on the prope~y or at the facility'/ 7. Hasfill dirt b~n ~,,ou~i onto the pmp~ty that originated bom a contamina~d site or that is of an unknown origin? 8. Ate ther~ ~,,~dly, or to the b~t of your knowledge have there b~n previously, any pits, pond~, or lagoot~ Ioca~d on the property in counection with wasto trea~ent or waste disposal? 9. [5 there ctha~ut]y, or to the ~ of you~ knowledge has there been previously, any stained soil on the property 11. A~ the~e cor~'dy, or to the ~ of your knowledge have there been pr~viunsly, any vent pipe~, fill pipe~, or anco~ way~ indicting a all pip~ pm~ding flora ~ ground on the property or adjacent to any previously, any flooring, drain.% or walls Ioc~d within the facility that ar~ ~ by subs-tunc~s other than wa~r or as~ ~nR~ng foul odor? 13. If thc property is ~¢n, cd by · private ~=ll or non-flubIic ~ttor ~ ha~c coatan~ina~ ~ id~tiiicd ~ ~c wvll or rystcm tl~ cxc~J dcsigun~l a~ conramlnatod by any govcnm~at covitonmcmaVhcalth proI~erty or any facility located on thc property assc~mcnt of thc property (page I of 2) (continued from page I) QUESTION YES NO UNK~ COMMENT~'-'--'-'~ 17. Does the owner or occupant of thc prol~er~ know of any pa~t. threatened, or pending lawsuits or administrative proceedings UNK Table is,ba~e~[:On ~lfi~TM Standard E l $28.97. Current Property Owner's Time Period of Ownership: ........ z ........ ~: Property Utilization During Ownership: ....... '~ .~.~ ................................................................ ...................................................................... Additional Comments (Including site source of water, sewage disposal methods and source of heating and fuel): This questionnaire was completed by: Title: Address: ~/.(' .~--.~-,~<..~ Phone Number: Preparer presents that to the best of the preparer's knowledge the above statements and facts are true and correct and to the best of the preparer's actual knowledge no material facts have been suppressed or misstated. Signature ~ ~ (page 2 of 2) ATTACHMENT NO. 2 RORIPAUGH RANCH OPEN SPACE PURCHASE AND SALES AGREEMENT MATRIX R:X3 I~Roripaugh Ranch SP~new\OS Purchase and Sales Agreement CC 5-13-03.doc 7 RORIPAUGH RANCH OPEN SPACE PURCHASE AND SALES AGREEMENT MATRIX Task Include Prior to Prior to on the Recordation Issuance of Deed of the Deed Grading Permit for the Roripaugh Ranch Specific Plan project City shall grant Ashby reservations for the purpose of X improvements shown on the deed over the necessary portions of the property for grading, construction, and maintenance purposes. Ashby shall obtain approval of California Fish and Game X Department, US Fish and Wildlife Service, Army Corp of Engineers, and San Diego Water Quality Board, as required by these agencies, prior to the transfer of the 201-acre habitat property to the City. Ashby shall submit to the City a Final Biologist Monitoring X Report approved by the US Fish and Wildlife Service, prepared and certified by a biologist to: 1. Ensure that toxic specie~ remain at baseline, 2. Ensure that the property has not been degraded by off- road vehicles, 3. Ensure that no illegal dumping has taken place. If the biologist determines these conditions exist, Ashby is obligated to take corrective actions prior to the recordation of ~ the deed. Ashby shall provide an update to the SID Geotechnical X Environmental Compliance Report dated February 25, 2002 prepared by qualified engineer to ensure that the conditions described in the said SID report are still current. Ashby shall pay CNLM a total of $439,298.00 that includes X $3,200 for funding the interim management of the property and $436,098.00 for funding the long-term maintenance of the property. Ashby shall provide the City assurance that a $99,600 bond X has been secured with CNLM to ensure the construction of the Interim Fence and the Temporary Fence. CNLM will release the bond when Ashby constructs the permanent fencing per the requirements of the Specific Plan. City to record' the conservation deed restriction to preserve the X area as habitat open space pursuant to AD 161 Agreement immediately after the recordation of the deed. Ashby is responsible for installation and maintenance of X minimum 4' high Interim Fence ("snow fence") for the purpose of controlling access and preserving the habitat areas prior to and during the grading process. Ashby shall perform all conditions required in regards to the fencing. RAS P~Roripaugh Ranch SP~ew~OS Parchase and Sales Agreement CC 5-13-03.doc 8 Task Include Prior to Prior to on the Recordation Issuance of Deed of the Deed Grading Permit for the Roripaugh Ranch Specific Plan project Ashby shall notify the Service 10 days prior to habitat X disturbance. Ashby shall submit to the City a copy of the Habitat X Management Plan approved by the US Fish and Wildlife Service. Ashby is responsible to install and maintain a 6' high temporary N/A N/A N/A chain link fence within 10 days from the establishment of the final grades in accordance with the rough grading plans along the boundary of the property. Ashby shall remove this fencing only when Ashby installs the permanent fencing. The City shall provide a copy of the deed restriction to the N/A N/A N/A Service within 30 days of recordation. Ashby shall prepare and obtain approval of the City of N/A N/A N/A Temecula Fire Department and all resource agencies including the Fish and Wildlife Service for a Fire Management Plan and submit it to the City within 60 days after the initiation of the ground disturbance unless waived by the City's Fire Marshall. Ashby is required to comply with Mitigation Monitoring Program N/A N/A N/A of the FEIR for the Roripaugh Ranch Specific Plan including all related permits. Ashby is responsible for constructing, maintaining, and N/A N/A N/A monitoring the wetlands within City's property until such time the resource agencies have accepted the mitigation area as complete. Ashby shall be responsible for providing funding for the N/A N/A N/A maintenance of Santa Gertrudis Creek within City's property until the responsibility is transferred to the Roripaugh Ranch's Master Home Owner's Association. Ashby shall perform its grading and construction operations in N/A N/A N/A accordance with the provisions of the AD 161, and the 401, 404, and 1603 permits. Ashby is responsible to pay for the maintenance of all fuel N/A N/A N/A modification zones within the City's property until such time that another entity, approved by the City, initiates their payments for this maintenance. R:~S PXRoripaugh Ranch SP~new\OS Purchase and Sales Agreement CC 5-13-03.doc 9 ITEM 9 AP PROV~AL,, CITY ATT O R NEY ' "~4)/"(--~:~_ DIRECTOR OF FINANCE CiTY MANAGER TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City Council/City Manager Gary Thornhili, Deputy City Manager~''- May 13, 2003 Award of Contract to Update the Citywide Design Guidelines Prepared by: Saied Naaseh, Senior Planner RECOMMENDATION: Award the contract to RRM Design Group in the amount of $70,245 to update the Design Guidelines. BACKGROUND: As part of streamlining the development review process, the City Council directed staff to respond to the development community's request to update the City's current Design Guidelines. The developer/architects expressed a desire to have more specific guidelines that reduced the subjectivity of staff's review of development projects. Staff agrees that adopting unambiguous guidelines for quality development will result in better direction for developers/architects to design and propose quality projects with their first submittal. Staff believes this will ultimately lead to a streamlined development review process. The Planning Department initially issued Requests for Proposal (RFP) in September of 2002 to update the Citywide Design Guidelines. However, only one firm submitted a proposal with a $45,000 budget. The Department's original budget was for this project was $15,000. In addition, planning staff determined this proposal did not fully meet the City's needs. As a result, staff requested an increase to the City's budget to $45,000 as part of the mid-year 2002-2003 budget and released a second RFP in March of 2003. The Department received eight proposals as a result of the second RFP. Three staff members and a Planning Commission representative interviewed the top three firms. The Committee was in agreement that RRM Design Group (RRM) had the experience and depth of staff to provide the necessary services to the City. RRM initially proposed a budget of approximately $90,000 to update the Design Guidelines. Staff subsequently met with Mark Brodeur, a Principal of the firm, and adjusted the scope of work resulting in a final contract amount of $70,245.00. The additional $25,245.00 needed to update the Design Guidelines will be funded through the Department's current budget. FISCAL IMPACT: The amount of the contract is $70,245. There are sufficient funds in line item 999-5248 (Consulting Services) in the Planning Department's budget to complete the envisioned work. Attachments: 1. Proposed Contract- Page 3 Exhibit A. Scope of Work - Page 4 Exhibit B. Budget- Page 5 A'I-rACHMENT NO. 1 PROPOSED CONTRACT R:'OESGUIDE~2003 Design Guidelines\CC Contracl Award.dec 3 AGREEMENT FOR CONSULTANT SERVICES THIS AGREEMENT is made and effective as of May 14, 2003, between the City of Temecula, a municipal corporation ("City") and RRM Design Group ("Consultant"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. TERM. This Agreement shall commence on May 14, 2003, and shall remain and continue in effect until tasks described herein are completed, but in no event later than June 30, 2004, unless sooner terminated pursuant to the provisions of this Agreement. 2. SERVICES. Consultant shall perform the services and tasks described and set forth in Exhibit A, attached hereto and incorporated herein as though set forth in full. Consultant shall complete the tasks according to the schedule of performance which is also set forth in Exhibit A. 3. PERFORMANCE. Consultant shall at all times faithfully, competently and to the best of his or her ability, experience, and talent, perform all tasks described herein. Consultant shall employ, at a minimum, generally accepted standards and practices utilized by persons engaged in providing similar services as are required of Consultant hereunder in meeting its obligations under this Agreement. 4. PAYMENT. a. The City agrees to pay Consultant monthly, in accordance with the payment rates and terms and the schedule of payment as set forth in Exhibit B, Payment Rates and Schedule, attached hereto and incorporated herein by this reference as though set forth in full, based upon actual time spent on the above tasks. Any terms in Exhibit B other than the payment rates and schedule of payment are null and void. This amount shall not exceed for the total term of the Agreement unless additional payment is approved as provided in this Agreement. b. Consultant shall not be compensated for any services rendered in connection with its performance of this Agreement which are in addition to those set forth herein, unless such additional services are authorized in advance and in writing by the City Manager. Consultant shall be compensated for any additional services in the amounts and in the manner as agreed to by City Manager and Consultant at the time City's written authorization is given to Consultant for the performance of said services. The City Manager may approve additional work up to ten percent (10%) of the amount of the Agreement or $25,000.00, but in no event shall the total sum of the agreement (basic agreement amount and contingency amount) exceed twenty -five thousand dollars ($25,000.00). Any additional work in excess of this amount shall be approved by the City Council. c. Consultant will submit invoices monthly for actual services performed. Invoices shall be submitted between the first and fifteenth business day of each month, for services provided in the previous month. Payment shall be made within thirty (30) days of receipt of each invoice as to all nondisputed fees. If the City disputes any of consultant's fees it shall give written notice to Consultant within 30 days of receipt of a invoice of any disputed fees set forth on the invoice. R:~DESGUIDE~2003 Design Guidelines\Contract text CC.doc Updated 2/2/01 5. SUSPENSION OR TERMINATION OF AGREEMENT WITHOUT CAUSE. a. The City may at any time, for any reason, with or without cause, suspend or terminate this Agreement, or any portion hereof, by serving upon the consultant at least ten (10) days prior written notice. Upon receipt of said notice, the Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise. If the City suspends or terminates a portion of this Agreement such suspension or termination shall not make void er invalidate the remainder of this Agreement. b. In the event this Agreement is terminated pursuant to this Section, the City shall pay to Consultant the actual value of the work performed up to the time of termination, provided that the work performed is of value to the City. Upon termination of the Agreement pursuant to this Section, the Consultant will submit an invoice to the City pursuant to Section 4. 6. DEFAULT OF CONSULTANT. a. The Consultant's failure to comply with the provisions of this Agreement shall constitute a default. In the event that Consultant is in default for cause under the terms of this Agreement, City shall have no obligation or duty to continue compensating Consultant for any work performed after the date of default and can terminate this Agreement immediately by written notice to the Consultant. If such failure by the Consultant to make progress in the performance of work hereunder arises out of causes beyond the Consultant's control, and without fault or negligence of the Consultant, it shall not be considered a default. b. If the City Manager or his delegate determines that the Consultant is in default in the performance of any of the terms or conditions of this Agreement, it shall serve the Consultant with written notice of the default. The Consultant shall have (10) days after service upon it of said notice in which to cure the default by rendering a satisfactory performance. In the event that the Consultant fails to cure its default within such period of time, the City shall have the right, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice to any other remedy to which it may be entitled at law, in equity or under this Agreement. 7. OWNERSHIP OF DOCUMENTS. a. Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identi- fied and readily accessible. Consultant shall provide free access to the representatives of City or its designees at reasonable times to such books and records, shall give City the right to examine and audit said books and records, shall permit City to make transcripts there from as necessary, and shall allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained fora period of three (3) years after receipt of final payment. b. Upon completion of, or in the event of termination or suspension of this Agreement, all original documents, designs, drawings, maps, models, computer files containing data generated for the work, surveys, notes, and other documents prepared in the course of providing the services to be performed pursuant to this Agreement shall become the sole property of the City and R:~DESGUIDE~2003 Design Guidelines\Contract text CC.doc Updated 2/2/01 may be used, reused or otherwise disposed of bythe City without the permission of the Consultant. With respect to computer files containing data generated for the work, Consultant shall make available to the City, upon reasonable written request by the City, the necessary computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. c. With respect to the design of public improvements, the Consultant shall not be liable for any injuries or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the wdtten consent of the Consultant. 8. INDEMNIFICATION. The Consultant agrees to defend, indemnify, protect and hold harmless the City, its officers, officials, employees and volunteers from and against any and all claims, demands, losses, defense costs or expenses, including attorney fees and expert witness fees, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property arising out of Consultant's negligent or wrongful acts or omissions arising out of or in any way related to the performance or non-performance of this Agreement, excepting only liability arising out of the negligence of the City. 9. INSURANCE REQUIREMENTS. Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may adse from or in connection with the performance of the work hereunder by the Consultant, its agents, representatives, or employees. a. Minimum Scope of Insurance. Coverage shall be at least as broad as: (1) Insurance Services Office Commercial General Liability form No. CG 00 01 11 85 or 88. (2) Insurance Services Office Business Auto Coverage form CA 00 01 06 92 covering Automobile Liability, code 1 (any auto). If the Consultant owns no automobiles, a non-owned auto endorsement to the General Liability policy described above is acceptable. (3) Worker's Compensation insurance as required by the State of California and Employer's Liability Insurance. If the Consultant has no employees while performing under this Agreement, worker's compensation insurance is not required, but Consultant shall execute a declaration that it has no employees. (4) Professional Liability Insurance shall be written on a policy form providing professional liability for the Consultant's profession. b. Minimum Limits of Insurance. Consultant shall maintain limits no less than: (1) General Liability: $1,000,000 per occurrence for bodily injury, personal injury and propertydamage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. (2) Automobile Liability: $1,000,000 per accident for bodily injury and property damage. R:~DESGUIDE~2003 Design Guidelines\Contract text CC.doc Updated 2/2/01 (3) Worker's Compensation as required by the State of California; Employer's Liability: One million dollars ($1,000,000) per accident for bodily injury or disease. (4) Professional Liability coverage: Two million ($2,000,000) per claim and in aggregate. c. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City Manager. At the option of the City Manager, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees and volunteers; or the Consultant shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. d. Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions: (1) The City, its officers, officials, employees and volunteers are to be covered as insureds as respects: liability arising out of activities performed by or on behalf of the Consultant; products and completed operations of the Consultant; premises owned, occupied or used by the Consultant; or automobiles owned, leased, hired or borrowed by the Consultant. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees or volunteers. (2) For any claims related to this project, the Consultant's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees and volunteers. Any insurance or self-insured maintained by the City, its officers, officials, employees or volunteers shall be excess of the Consultant's insurance and shall not contribute with it. (3) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers. (4) The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. (5) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. e. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City. Self insurance shall not be considered to comply with these insurance requirements. R:~DESGUIDEL2003 Design Guidelines\Contract text CC.doc Updated 2/2101 f. Verification of Coverage. Consultant shall furnish the City with original endorsements effecting coverage required by this clause. The endorsements are to be signed by a person authorized bythat insurer to bind coverage on its behalf. The endorsements are to be on forms provided by the City. All endorsements are to be received and approved by the City before work commences. As an alternative to the City's forms, the Consultant's insurer may provide complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications. 10. INDEPENDENT CONTRACTOR. a. Consultant is and shall at all times remain as to the City a wholly independent contractor. The personnel performing the services under this Agreement on behalf of Consultant shall at all times be under Consultant's exclusive direction and control. Neither City nor any of its officers, employees, agents, or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents except as set fodh in this Agreement. Consultant shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of the City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner. b. No employee benefits shall be available to Consultant in connection with the performance of this Agreement. Except for the fees paid to Consultant as provided in the Agreement, City shall not pay salaries, wages, or other compensation to Consultant for performing services hereunder for City. City shall not be liable for compensation or indemnification to Consultant for injury or sickness arising out of performing services hereunder. 11. LEGAL RESPONSIBILITIES. The Consultant shall keep itself informed of all local, State and Federal ordinances, laws and regulations which in any manner affect those employed by it or in any way affect the performance of its service pursuant to this Agreement. The Consultant shall at all times observe and comply with all such ordinances, laws and regulations. The City, and its officers and employees, shall not be liable at law or in equity occasioned by failure of the Consultant to comply with this section. 12. RELEASE OF INFORMATION. a. All information gained by Consultant in performance of this Agreement shall be considered confidential and shall not be released by Consultant without City's prior written authorization. Consultant, its officers, employees, agents or subcontractors, shall not without wdtten authorization from the City Manager or unless requested by the City Attorney, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement or relating to any project or property located within the City. Response to a subpoena or court order shall not be considered "voluntary" provided Consultant gives City notice of such court order or subpoena. b. Consultant shall promptly notify City should Consultant, its officers, employees, agents or subcontractors be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed there under or with respect to any project or property located within the City. City retains the right, but has no obligation, to represent Consultant and/or be present at any deposition, headng or similar proceeding. Consultant agrees to cooperate fully with City and to provide City with the opportunity to review any response to discovery requests provided by Consultant. However, City's right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response. R:~DESGU1DEk2003 Design Guidelines\Contract text CC.doc Updated 2/2/01 13. NOTICES. Any notices which either party may desire to give to the other party under this Agreement must be in writing and may be given either by (I) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice. Notice shall be effective upon delivery to the addresses specified below or on the third business day following deposit with the document delivery service or United States Mail as provided above. To City: To Consultant: City of Temecula Mailing Address: P.O. Box 9033 Temecula, California 92589-9033 43200 Business Park Drive Temecula, California 92590 Attention: City Manager RRM Design Group Mark BrodetLr, FIUD 31831 Camino Capistrano, Suite 200 San Juan Capistrano, CA 92675 14. ASSIGNMENT. The Consultant shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without pdor wdtten consent of the City. Upon termination of this Agreement, Consultant's sole compensation shall be payment for actual services performed up to, and including, the date of termination or as may be otherwise agreed to in writing between the City Council and the Consultant. 15. LICENSES. At all times during the term of this Agreement, Consultant shall have in full rome and effect, all licenses required of it by law for the performance of the services described in this Agreement. 16. GOVERNING LAW. The City and Consultant understand and agree that the laws of the State of California shall govem the rights, obligations, duties and liabilities of the parties to this Agreement and also govern the interpretation of this Agreement. Any litigation concerning this Agreement shall take place in the municipal, superior, or federal district court with geographic jurisdiction over the City of Temecula. In the event such litigation is filed by one party against the other to enforce its rights under this Agreement, the prevailing party, as determined by the Court's judgment, shall be entitled to reasonable attorney fees and litigation expenses for the relief granted. 17. PROHIBITED INTEREST. No officer, or employee of the City of Temecula shall have any financial interest, direct or indirect, in this Agreement, the proceeds thereof, the Contractor, or Contractor's sub-contractors for this project, during his/her tenure or for one year thereafter. The Contractor hereby warrants and represents to the City that no officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the Contractor or Contractor's sub-contractors on this project. Contractor further agrees to notify the City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. R:\DESGUIDE~2003 Design Guidelines\Contract text CC.dcc Updated 2/2/01 18. ENTIRE AGREEMENT. This Agreement contains the entire understanding between the parties relating to the obligations of the parties described in this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged into this Agreement and shall be of no further force or effect. Each partyis entering intothis Agreement based solely upon the representations set forth herein and upon each party's own independent investigation of any and all facts such party deems material. 19. AUTHORITY TO EXECUTE THIS AGREEMENT. The person or persons executing this Agreement on behalf of Consultant warrants and represents that he or she has the authority to execute this Agreement on behalf of the Consultant and has the authority to bind Consultant to the performance of its obligations hereunder. R:~DESGUIDEL2003 Design Guidelines\Contract text CC.doc Updated 2/2/01 The parties hereto have executed this Agreement on the date and year above written. CONSULTANT CITY OF TEMECULA By:! . , ATTEST: By:. Jeff Stone, Mayor Susan Jones, City Clerk APPROVED AS TO FORM: Peter M. Thorson, City Attorney R:\FORMS\CONTRACT.SVC 5/I/03 klb EXHIBIT A SCOPE OF WORK OF THE CONTRACT SCOPE OF SERVICES EXHIBITA Dated: April 24, 2003 The CITY OF TEMECULA wants a design manual that will assure "high quality" development. RRM DESIGN GROUP bas developed a comprehensive approach to accomplishing this goal. We are not certain of what the "budget" is to develop this design manual. Therefore, we ask that the reader consider this our recommended approach and understanding; that we will include or exclude Scope elements to be in line with the anticipated budget The following SCOPE OF SERVICES assumes that the City staff will be responsible for preparing all staff reports, public meeting notices, & mailing lists and notifying property owners/developers of the public workshops. PHASE [ DISCOVERY PHASE TASK '1.'1 KICK-OFF MEETING WITH CITY DEVELOPMENT TEAM Upon authorization to proceed, Mark Brodeur and Jami Williams will meet with the City Development Team. The purpose of the meeting will be: · Confirm Key Project Objectives · City StaffTo Identify ReocCUrnng Problems · Collect all background information including: · Electric base map fdes · Zoning map/general plan urban design · Applicable zoning ordinance sections PRODUCT: Brodeur/Williams attendance at a meeting. No physical product is anfcipated unless substantially more work is requested. In that case, RRM will develop a new Scope of Services. TIME FRAME: Within three (3) weeks of authorization to proceed. TASK '1.2 REVIEW BACKGROUND MATERIALS The RRM Team will review all information transmitted during TASK 1.1. PRODUCT: None TIME FRtaVlE: Three (3) days lit RRM DESIGN GROUP SCOPE OF SERVICES EXHIBrrA iii TASK 1.3 ANALYSIS BY RRM DEVELOPMENT TEAM The Architects, Planners and Engineers at RRM Design Group represent several residential, commercial and industrial developers in various jurisdictions throughout California. As such, they typically have to utilize local code and guidelines to get their projects approved. Jami Williams will sit down with three (3) representatives from the RRM development team and will ask them to critique the current design guidelines, asking them where the guidelines could be strengthened to assure higher quality development. PRODUCT: Four (4) to five (5) page memorandum TIME FRAME: Four (4) to six (6) days TASK 1.4 MEETING WITH STAFF TO RENEW FINDINGS Jami williams will meet with Temecula City Staff to review the findings of her report and to receive direction from Staff regarding the Development Team's findings. PRODUCT: None TIME FRAME: one (1) day TASK 1.5 PLANNING COMMISSION WORKSHOP RRM will develop a PowerPoint presentation to be given at a joint meeting of the Planning Commission. The presentation will focus on RRM's findings to date and examples of high quality local development. RRM Design Group and City staffwill request that the PC members relate their own personal experiences with the "quality" developments currently found in other communities. These projects will become known as "icon" projects and will become examples for the right way to develop "quality" developments. As part of the Workshop, the public will also be asked to provide testimony on any subcommittee members' design issues that they have concerns with. PRODUCT: PowerPoint presentation; icon list TIME FRAME: Three (3) days TASK 1.6 "NEXT DAY" MEETING WITH STAFF TO REVIEW WORKSHOP INPUT Jami Williams and Mark Brodeur will meet with Temecula City Staff (next moming) to review the findings from the Workshop and to receive direction from Staff PRODUCT: None TIME FRAME: One (1) Day SCOPE OF SERVICES EXHIBrrA PHASE II COMPONENTS PHASE TASK 2.1 DEVELOP DETAILED OUTLINE OF DESIGN GUIDELINES RRM Design Group will develop a multi-page, annotated outline of the Design Guidelines Manual. The outline will be electronically submitted to staff. Staffwill revise and transmit ONE (1) revised outline back to RP, M to work from. PRODUCT: Multi-page outline of Design Guidelines Manual induding (1) revision. TIME FRAME: One (1) week STAFF REWlEW: One (1) week TASK 2.2 FINALIZE DOCUMENT STYLE/LAYOUT RRM will electronically submit five (5) alternative document layouts. The text and graphics transmitted will be generic and not meant to convey the actual design standards. All five (5) alternatives will be 8 ¼ x I1. Staffwill select one (1) style and retum it to RRM. PRODUCT: Five (5) alternative page layouts TIME FRAME: Two (2) days STAFF REVIEW: One (1) week TASK 2.3 THE NEW GUIDELINE APPROACH RRM will develop a new "standard" for how the design guidelines will be written for maximum effectiveness. Rather than repeat the way the current guidelines are written, the new document would contain subject headings that are more design policy., such as "It is desirabk for buildings not to Var ove~ bulky and mas~ite" followed by mandatory design standards (minimum requirements) and then a section of design guidelines (discretionary), illustrating alternative methods to break up the bulk & mass of a building. PRODUCT: None at this point TIME FRAME: One (1) week iii TASK 2,4 PREPARE GENERAL DEVELOPMENT DESIGN GUIDELINES RRM will write and develop illustrations for new development inciuding Commercial, Business Park and other non residential design guidelines. The guidelines will contain as much mandatory versus discretionary language as possible to minimize interpretation and confusion. Photographs of actual design guidance will be included wherever possible. SCOPE OF SERVICES Exmen'A These guidelines will focus on the followin~ · Acceptable Bulk and Height · Acceptable Architectural Materials Palette · Site planning Standards · Parking Lot Guiddines · Walls and Fences/Screening · Required Site Furniture Amenities · Outdoor Lighting Standards/Guidelines PRODUCT: Draft Design Standards TIME FRJaVIE: Three (3) weeks STAFF REVIEW:One (1) week TASK 2.5 DEVELOP RESIDENTIAL DESIGN GUIDELINES RRM Design Group will produce upgraded design standards for residential development. Text and illustrations/photographs will be utilized throughout this section. These standards will contain as much mandatory versus discretionary language as possible to minimize interpretation and confusion. Photographs of actual design guidance will be included wherever possible. iii These standards will focus on six (.6) major design components as follows: · Maximum Unit Configuration · Acceptable Height and Bulk · Prohibited Exterior Architectural Materials · Site Planning Guidelines · Parking/Garage Design Standards · Character Defining Elements of Five Most Popular Architectural Styles (pictorial) PRODUCT: Residential Design Guidelines TIME FRAME: Two (2) to three (3) weeks STnFF REVIEW: Two (2) weeks TASK 2.6 'DEVELOPING THE "SPECIALIZED USE" DESIGN GUIDELINES This section is intended to provide specific design direction to address some of the more challenging- from a design perspective - commercial development types. SCOPE OF SERVICES EXHIBrrA Specific design standards will be developed for each use which provide additional design direction not already contained in the General Design Standards. Hotel/motels · Churches · Vehicle Dealerships · Auto Semce Uses · Convenience Stores/Gas Stations · Drive-through businesses · Big Box retail · Mixed use projects (shopping center retrofit) PRODUCT: Specialized Use Design Guiddines TIME FRAME: Two (2) weeks concurrent with TASKS 2.3 and 2.4 STAFF REVIEW: Two (2) weeks concurrent with Task 2.6 TASK 2.7 DEVELOP THE SION DESION GUIDELINES RRM will start by reviewing the appropriateness of the current sign zoning standards. RRM will then develop two different elements under this chapter. The first section will be a combination of sign standards (sign type, illumination, materials) not typically covered by zoning and design guidelines for freestanding and wall signs. Other sign types may be included as discovery of weaknesses emerges. PRODUCT: Sign Design Standards TIME FRAME: Two (2) weeks concurrent with TASK 2.5 TASK 2.8 DEVELOP THE ILLUSTRATED GLOSSARY OF TERMS RRM will develop a set of richly illustrated design terms used in the Design Guidelines manual. PRODUCT: Illustrated Glossary of Terms TIME FRAME: Two (2) to three 0) weeks iii SCOPE OF SERVICES EXHIBITA PHASE I I I - DEVELOP THE DRAFT DOCUMENTS TASK 3.1 DEVELOP THE ADMINISTRATIVE DRAFT RRM will develop a Table of Contents, introductory chapters, glossary and other non-standards language. These will be added to completed standards chapters after modifying them per Staff comments. Five (5) black and white, partially illustrated documents will be transmitted to the City Development Team for their review. City staffwill be responsible for collecting and combining all comments into one (1) red-ink modified version to transmit to RRM Design Group. PRODUCT: Administrative Draft (one (1) electronic/one (1) print copy) TIME FRAME: Four (4) weeks concurrent with PHASE III TASK 3.2 MEETING WITH CITY STAFF/DEVELOPMENT TEAM Following receipt of the City staff's red-ink comments, Mark Brodeur will meet to discuss any concerns or questions on the design guidelines manual. PRODUCT: Memo of meeting results TIME FRAME: One (1) week TASK 3,3 DEVELOP ADDITIONAL GRAPHICS/PHOTOS/IMAGES Following the meeting with the City Staff, there is usually a request for additional or replacement graphics or images. This task provides the necessary budget and schedule to develop up to 15 new images for the Manual. PIIODUCT: Up to fifteen (15) new unages TIME FRAME: Two (2) to three (3) weeks TASK 3.4 DEVELOP THE PUBLIC REVIEW DRAFT RRM will develop a fully illustrated, full color version of the design standards manual. RRM will transmit ten (10) B&W versions, one color original and electronic version of the Manual to City staff. tli PRODUCT: Public Review Draft (one (1) electtonic/one (1) print copy) TIME FRAME: Five (5) weeks SCOPE OF SERVICES EXHIBITA PHASE IV - PUBLIC INPUT AND REVIEW TASK 4.'! PLANNING COMMISSION WORKSHOP RRM Design Group w'fll develop a comprehensive executive sumanary-PowerPoint presentation. This presentation as well as a "question and answer" format presentation v/ill be made to residents. This presentation will be made to the Planning Commission in a workshop setting. City staffwill handle all meeting arrangements; Mark Brodeur will make the presentation. PRODUCT: A simple matrix, created by City Staff, articulating reasonable comments received and RRM's response and PowerPoint presentation on compact disk (pdf file). TIME FRAME: One (1) week TASK 4.2 PLANNING COMMISSION HEARING Mark Brodeur will attend and present at one (1) Planning Commission Hearing. Suggested modifications will be noted and put into a matrix or memo to the City Council. PRODUCT: City StaffMatrix articulating comments received and RRM's response TIME FRAME: One(l) week TASK 4.3 COUNCIL HEARIN6 Mark Brodeur will present the Public Review Draft and Planning Commission "suggested modifications" matrix at one (1) City Council Heating. Mark Brodeur will make the presentation. PRODUCT: City StaffMatrix of any last minute comments and RRM's response TIME FRt~E: One (1) week iii SCOPE OF SERVICES EXH RgA PHASE V - PROJECT MANAGEMENT & PROJECT CLOSEOUT TASK 5.1 FINAL MANUAL RRM will develop the final manual based upon the outcome of the Council Heating. PRODUCT: One (1) color print & one (1) electronic version of the document will be submitted on compact disk. TIME FRAME: Two (2) weeks following Council approval. TASK 5.2 PROJECT MANAGEMENT Mark Brodeur will manage this assignment. This task covers the day-to-day elements of running this Phase. These may include but are not limited to: · Conversations, emails, faxes with Client · Scheduling of professional staff · Quality control and proofreading · Developing main ideas and unique thematic elements · Billing · Contract disputes PRODUCTS: Varied TIME FRAME: Eight (8) months from project start iii RRM DESIGN GROUP SCOPE OF SERVICES EXHIBITA OPTIONAL TASK TASK #1 DEV~OP ~E UNm~Y ~" SK~A~mE ELB~rs Every well designed community with an established sense of place has a "look" that is memorable. In some cases, it just happened that way. In newer communities such as Temecula, it needs to be articulated as part of the public and private developments most visible to motorists and pedestrians. RRM will develop Palette-required elements which will be incorporated into each non-residential development in Temecula. These will include: · One or two specific building dements · One or two building materials (stone/wood) · A signature trim color for site furnishings · A signature paving dement or pattern · A signature landscape palette · Other elements such as walls, fences & gates, as appropriate PRODUCT: TIME FRAME: Signature Elements Palette Two (2) to three (3) weeks iii RRM DESIGN GROUP EXHIBIT B BUDGET FOR THE CONTRACT ITEM 10 TO: FROM: DATE: SUBJECT: CITY ATTORNEY DIRECTOR OF FINANC~ CITY MANAGER CITY OF TEMECULA AGENDA REPORT City Manager/City Council J.--)~//William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Tract Map No. 29353-1 located south of Murrieta Hot Springs Road and west of the Metropolitan Water District Fee Right of Way within the Plateau Area of the Roripaugh Ranch Specific Plan PREPARED BY: (~'FRonald J. Parks, Deputy Director of Public Works (~lement M. Jimenez, Associate Engineer · RECOMMENDATION: That the City Council approve 1) Tract Map No. 29353-1 in conformance with the Conditions of Approval 2) Subdivision Improvement Agreement 3) Subdivision Monument Agreement and accept the Faithful Performance Bond, Labor and Material Bond and Monument Bond as security for the agreements. BACKGROUND: Tract Map No. 29353-1 is located within that portion of the Plateau Area located west of the Metropolitan Water District in the Roripaugh Ranch Specific Plan. On November 26, 2002, the City Council approved the Roripaugh Ranch Project consisting of: Annexation PA94-0073, General Plan Amendment PA99-0298, Specific Plan PA94-0075, Change of Zone PA94-0075, EIR PA94-0076, TTM 29661 PA01-0253, TTM 29353 PA01-0230, Development Agreement PA99-0299. A second reading was held on December 17, 2002. The Phasing Map for Tentative Tract Map No. 29353 PA03-0040 was approved on April 7, 2003. This Developer has met all applicable Conditions of Approval. Some conditions have been deferred to the recordation of future subdivision maps, as they are more applicable to those maps. This final map is in conformance with the approved tentative map. The approval of a final subdivision map, which substantially complies with the previously approved tentative map, is a mandatory ministerial act under State law. Staff is currently reviewing the Covenants, Conditions, and Restrictions. The final map will not be recorded until these are approved. Final Tract Map No. 29353-1 is an eight (8) large lot subdivision. The recordation of this map will allow the developer to sell these lots to merchant builders. These lots will be further subdivided in accordance with the land use requirements of the Roripaugh Ranch Specific Plan. Future subdivisions will consist of single-family residential lots, park, recreation center, and open space areas. The site is currently vacant. FISCAL IMPACT: None AI'I'ACHMENTS: 2. 3. 4. Development Fee Checklist Fees & Securities Report Project Vicinity Map Tract Map No. 29353-1 r:',agdrpt",2003~0513\tm29353-1 .map CITY OF TEMECULA DEVELOPMENT FEE CHECKLIST CASE NO. TM 29353-1 The following fees were reviewed by Staff relative to their applicability to this project. FEE Development Impact Fee Transportation Uniform Mitigation Fee CONDITIONS OF APPROVAL To be paid prior to issuance of a building permit To be paid prior to issuance of a building permit 2 r:~agdrpt~003\0513\trn29353-1 .map CITY OF TEMECULA ENGINEERING DEPARTMENT FEES AND SECURITIES REPORT TRACT MAP NO. 29353-1 DATE: May 13, 2003 IMPROVEMENTS FAITHFUL PERFORMANCE MATERIAL & LABOR SECURITY SECURITY Meadows Pkwy (Pourroy Rd to MWD Fee Right of Way) Street and Drainage $1,793,000 $896,500 Water $218,500 $109,500 Sewer $19,500 $10,000 TOTAL $2,031,000 $1,015,500 DEVELOPMENT FEES City Traffic Signing and Striping Costs RCFCD (ADP) Fee Development impact Fee Transportation Uniform Mitigation Fee $ 0.00 $ *TBD $ *TBD $ *TBD SERVICE FEES Planning Fee Comprehensive Transportation Plan Plan Check Fee Monument Inspection Fee Additional Plan Check Fee (4th and subsequent reviews) Fees Paid to Date Balance of Fees Due *TBD = To Be Determined 108.00 8.oo 890.00 500.00 800.00 2,306.00 o.oo 3 r:~agd rpt~O03~513\tm29353-1 .map ~'--B U TTERFIEL O ,LEON LEONr, f?-~. RD. ~ STAGE RD. £ I]]H$ IlS ITEM 11 APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE~ CITY MANAGER TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City Manager/City Council /~J-}~VVilliam G. Hughes, Director of Public Works/City Engineer May 13, 2003 Acceptance of an Easement for Public Utility and Drainage Purposes together with the Right of Ingress and Egress for Emergency Vehicles within Tract Map No. 23371-1 located North of Rancho California Road, East of Margarita Road, West of Meadows Parkway, South of La Serena Way and within the Margarita Village Specific Plan No. 199, Temeku Hills Subdivision. PREPARED BY: ~ Ronald J. Parks, Deputy Director of Public Works ~-~ Clement M. Jimenez, Associate Engineer RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES LOCATED WITHIN TRACT MAP NO. 23371-1 BACKGROUND: Tract Map No. 23371-1 was approved by the City Council on March 27, 1990. The owner chose to retain all interior streets, and so designated private streets on the final map. Therefore, right of way was not dedicated to the public on the final map. On December 10, 1996, the City Council accepted an offer of dedication of right of way for street purposes as well as a separate offer of dedication for sidewalk and utility purposes. On January 16, 1997, the County Recorder of the County of Riverside recorded the offers of dedication for street purposes and sidewalk and utility purposes as Instrument Nos. 015933 and 015928 respectively. On May 22, 2001 the City Council accepted these streets into the city-maintained street system. However, an easement for public utility and drainage purposes together w~th the right of ingress and egress for emergency vehicles was not accepted at that time. This easement is located within Lots "C" through "H", inclusive in Tract Map No. 23371-1. Since this easement is within the already accepted streets, Staff recommends its acceptance. In this way the Department of Public Works can maintain the storm drains and issue encroachment permits to utility companies for utility maintenance and repair. FISCAL IMPACT: Periodic storm drain maintenance will be required. ATTACHMENT: 1. Resolution No. 2003- with Exhibit "A", inclusive. 2. Location Map 1 r:~agdrpt\.2003~0513\tr23371-1.accept storm drain RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES LOCATED WITHIN TRACT MAP NO. 23371-1 THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication of right of way for street purposes made by Temeku Hills Development Partners, LP, a California Limited Partnership as a separate document recorded on January 16, 1997 as Instrument No. 015933: and, WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication for sidewalk and utility purposes made by Temeku Hills Development Partners, LP, a California Limited Partnership as a separate document recorded on January 16, 1997 as Instrument No. 015928: and, WHEREAS, On May 22, 2001 the City Council of the City of Temecula accepted the streets into the city-maintained street system, for which an offer of dedication of right of way including sidewalk and utility purposes was previously accepted, into the city-maintained street system: and, WHEREAS, All bonds pertaining to this tract have been released, inbluding the final warranty bond: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts the offer of dedication for an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles within Lots "C" through "H" in recorded Tract Map No. 23371-1 as described in Exhibit "A" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 r:~gdrpt\.2003\0513\tr23371-1 .accept storm drain STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003-. was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 r:~agdrpt~2003~513\tr23371-1 ,accept storm drain EXHIBIT "A" TO RESOLUTION NO. 2003-.__ Accepting an offer of dedication to public use an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles of and within Lots "C" through "H", inclusive as described in the Owners Statement of recorded Tract Map No. 23371-1 in the City of Temecula, County of Riverside, as filed in Book 216, Pages 8-16 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "C' (Tee Drive) of said Tract Map No. 23371-1 2. Lot "D" (Temeku Drive between Tee Drive and Royal Birkdale Drive) of said Tract Map No. 23371-1 o Lot "E' (Temeku Drive between Royal Birkdale Drive and the Metropolitan Water District's Fee Right of Way) of said Tract Map No. 23371-1 4. Lot "F" (Royal Birkdale) of said Tract Map No. 23371-1 5. Lot "G" (Flag Way) of said Tract Map No. 23371-1 6. Lot "H" (Canterbury Court) of said Tract Map No. 23371-1. 4 r:~agdrpt~.2003~513\t r23371-1 .accept storm drain ITEM 12 APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE..~.~ CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: City Manager/City Council ~/[ William G. Hughes, Director of Public Works/City Engineer FROM: DATE: May 13, 2003 SUBJECT: Acceptance of an Easement for Public Utility and Drainage Purposes together with the Right of Ingress and Egress for Emergency Vehicles and other Easements for Public Utility and Drainage Purposes within Tract Map No. 23371-2 located North of Rancho California Road, East of Margarita Road, West of Meadows Parkway, South of La Serena Way and within the Margarita Village Specific Plan No. 199, Temeku Hills Subdivision. PREPARED BY: ~f~ Ronald J. Parks, Deputy Director of Public Works ~-Clement M. Jimenez, Associate Engineer RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- __ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENTS FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-2 BACKGROUND: Tract Map No. 23371-2 was approved by the City Council on May 29, 1990. The owner chose to retain all interior streets, and so designated private streets on the final map. Therefore, right of way was not dedicated to the public on the final map. On December 10, 1996, the City Council accepted an offer of dedication of right of way for street purposes as well as a separate offer of dedication for sidewalk and utility purposes. On January 16, 1997, the County Recorder of the County of Riverside recorded the offers of dedication for street purposes and sidewalk and utility purposes as Instrument Nos. 015934 and 015929 respectively. On May 22, 2001 the City Council accepted these streets into the city-maintained street system. However, an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles was not accepted at that time. This easement is located within Lots "B" through "E", inclusive in Tract Map No. 23371-2. Since this easement is within the alreadyaccepted streets, Staff recommends its acceptance. In this way the Department of Public Works can maintain the storm drains and issue encroachment permits to utility companies for utility maintenance and repair. In addition, Staff recommends the acceptance of the offer of dedication of two public utility and drainage easements located in open space lots because these easements carry drainage facilities and utilities that connect to the already accepted street system. 1 r:~agdrpt~.2003~513\tr23371-2.accept storm drain FISCAL IMPACT: ATTACHMENT: 1. Resolution No. 2003- 2. Location Map Periodic storm drain maintenance will be required. with Exhibit "A", inclusive. 2 r:'agdrpt~.2003~0513\tr23371-2.accept storm drain RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENTS FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-2 THE CITY COUNCIL OF TH E CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication of right of way for street purposes made by Temeku Hills Development Partners, LP, a California Limited Partnership as a separate document recorded on January 16, 1997 as Instrument No. 015934: and, WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication for sidewalk and utility purposes made by Temeku Hills Development Partners, LP, a California Limited Partnership as a separate document recorded on January 16, 1997 as Instrument No. 015929: and, WHEREAS, On May 22, 2001 the City Council of the City of Temecula accepted the streets into the city-maintained street system, for which an offer of dedication of right of way including sidewalk and utility purposes was previously accepted, into the city-maintained street system: and, WHEREAS, All bonds pertaining to this tract have been released, including the final warranty bond: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts the offer of dedication for an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles within Lots "B" through "E" in recorded Tract Map No. 23371-2 as well as two other public utility and drainage easements located within open space lots, all as described in Exhibit "A" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 3 r:~agdrpt\.2003\0513\tr23371-2.accept storm drain STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003-_ was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 13th day of May, 2003, by the following vote: AYES: 0 COUNCILMEMBERS: NOES: 0 COUNCILMEMBERS: ABSENT: 0 COUNCILMEMBERS: ABSTAIN: 0 COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 4 r:tagdrpt~,2003~513\tr23371-2.accept storm drain EXHIBIT "A" TO RESOLUTION NO. 2003-__ Accepting an offer of dedication to public use an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles of and within Lots "B" through "E", inclusive as described in the Owners Statement of recorded Tract Map No. 23371-2 in the City of Temecula, County of Riverside, as filed in Book 219, Pages 18-25 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "B" (Parway) of said Tract Map No. 23371-2 2. Lot "C" (Cascades Court) of said Tract Map No. 23371-2 3. Lot "D" (Pinway) of said Tract Map No. 23371-2 4. Lot "E" (Colonial Court) of said Tract Map No. 23371-2 TOGETHER WiTH An easement dedicated for public utility and drainage purposes located within Open Space Lot 37 of said Tract Map No. 23371-2 TOGETHER WiTH An easement dedicated for public utility and drainage purposes located within Open Space Lot 39 of said Tract Map No. 23371-2. 5 r:~agdrpt~.2003~513\tr23371-2.accept storm drain ITEM 13 APPROVAL CITY ATTORNEY DIRECTOR OF FiNANCE~______ CITY MANAGER TO: FROM: DATE: SUBJECT: ClTY OFTEMECULA AGENDA REPORT City Manager/City Council ,"~/~/William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Acceptance of an Easement for Public Utility and Drainage Purposes together with the Right of Ingress and Egress for Emergency Vehicles and other Easement for Public Utility and Drainage Purposes within Tract Map No. 23371-5 located North of Rancho California Road, East of Margarita Road, West of Meadows Parkway, South of La Serena Way and within the Margarita Village Specific Plan No. 199, Temeku Hills Subdivision. PREPARED BY: ~ Ronald J. Parks, Deputy Director of Public Works (~ Clement M. Jimenez, Associate Engineer RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- __ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-5 BACKGROUND: Tract Map No. 23371-5 was approved by the City Council on August 28, 1990. The owner chose to retain all interior streets, and so designated private streets on the final map. Therefore, right of way was not dedicated to the public on the final map. On December 10, 1996, the City Council accepted an offer of dedication of right of way for street purposes as well as a separate offer of dedication for sidewalk and utility purposes. On January 16, 1997, the County Recorder of the County of Riverside recorded the offers of dedication for street purposes and sidewalk and utility purposes as Instrument Nos. 015937 and 015932 respectively. On May 22, 2001 the City Council accepted these streets into the city-maintained street system. However, an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles was not accepted at that time. This easement is located within Lots "A" through "E", inclusive in Tract Map No. 23371-5. Since this easement is within the already accepted streets, Staff recommends its acceptance. In this way the Department of Public Works can maintain the storm drains and issue encroachment permits to utility companies for utility maintenance and repair. In addition, Staff recommends the acceptance of the offer of dedication of a public utility and drainage easement located within Open Space Lot 75 (Golf Course) of Tract Map No. 23371-5 because this easement carries drainage facilities and utilities that connect to the already accepted street system. I r:~agdrpt\.2003't0513\tr23371-5.accept storm drain FISCAL IMPACT: A'I'rACHMENT: 1. Resolution No. 2003- 2. Location Map Periodic storm drain maintenance will be required. with Exhibit "A", inclusive. 2 r:~agdrpt~.2003~0513\tr23371-5.accept storm drain RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING AN EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES TOGETHER WITH THE RIGHT OF INGRESS AND EGRESS FOR EMERGENCY VEHICLES AND OTHER EASEMENT FOR PUBLIC UTILITY AND DRAINAGE PURPOSES LOCATED WITHIN TRACT MAP NO. 23371-5 THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication of right of way for street purposes made by Temeku Hills Development Partners, LP, a California Limited Partnership as a separate document recorded on January 16, 1997 as Instrument No. 015937: and, WHEREAS, On December 10, 1996, the City Council of the City of Temecula accepted an offer of dedication for sidewalk and utility purposes made by Temeku Hills Development Partners, LP, a California Limited Padnership as a separate document recorded on January 16, 1997 as Instrument No. 015932: and, WHEREAS, On May 22, 2001 the City Council of the City of Temecula accepted the streets into the city-maintained street system, for which an offer of dedication of right of way including sidewalk and utility purposes was previously accepted, into the city-maintained street system: and, WHEREAS, All bonds pertaining to this tract have been released, including the final warranty bond: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts the offer of dedication for an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles within Lots "A" through "E" in recorded Tract Map No. 23371-5 as well as one other public utility and drainage easement located within Open Space Lot 75 (Golf Course) of Tract Map No. 23371-5, all as described in Exhibit "A" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 3 r:~agdrpt\.2003\0513\tr23371-5.accept storm drain STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Wo Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on the 13th day of May, 2003, by the following vote: AYES: 0 COUNCILMEMBERS: NOES: 0 COUNCILMEMBERS: ABSENT: 0 COUNCILMEMBERS: ABSTAIN: 0 COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 4 r:~agdrpt\.2003~0513\tr23371-5.accept storm drain EXHIBIT "A" TO RESOLUTION NO. 2003-.__ Accepting an offer of dedication to public use an easement for public utility and drainage purposes together with the right of ingress and egress for emergency vehicles of and within Lots "A" through "E", inclusive as described in the Owners Statement of recorded Tract Map No. 23371-5 in the City of Temecula, County of Riverside, as filed in Book 224, Pages 50-56 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "A" (Niblick Road south of Brassie Lane) of said Tract Map No. 23371-5 2. Lot "B" (Dog Leg Circle) of said Tract Map No. 23371-5 2. Lot "C" (Nassau Court) of said Tract Map No. 23371-5 3. Lot "D" (Niblick Road north of Wedge Way) of said Tract Map No. 23371-5 4. Lot "E" (Spoon Circle) of said Tract Map No. 23371-5 TOGETHER WITH An easement dedicated for public utility and drainage purposes located within Open Space Lot 75 of said Tract Map No. 23371-5. 5 r:~gdrpt\,2003',O513\tr23371-5.accept storm drain ITEM 14 APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: FROM: City Manager/City Council /y,~ William G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Subdivision Improvement Agreement and Bonds for TM 29639 Harveston Offsite Improvements - Winchester Road Widening at 1-15 Southbound Off- Ramp affecting Jefferson Avenue PREPARED BY: r/'Ronald J. Parks, Deputy Director of Public Works (~ Clement M. Jimenez, Associate Engineer RECOMMENDATION: That the City Council: 1. ACCEPT the Subdivision Improvement Agreement for the offsite improvements required of the Harveston Project developer, Lennar Communities. 2. ACCEPT the Subdivision Faithful Performance and Labor & Materials Bond as security for the improvements and as a source for claims against labor and materials, respectively. 3. DIRECT the City Clerk to so advise the developer and surety. BACKGROUND: The Harveston Project required certain improvements to be made on Winchester Road and the 1-15 Southbound Off-ramp to mitigate traffic impact from the project. These improvements are summarized in Attachment 5 of the Development Agreement dated August 28, 2001. The developer, Harveston, LLC, has processed improvement plans through Caltrans and the City for approval. These plans affect the southeast corner of the intersection of Winchester Road and Jefferson Avenue. The improvement plans are approved and both Caltrans and the City have issued encroachment permits. The primary improvements affect Winchester Road at 1-15 Southbound Off-ramps and consist of the following: 1) addition of an eastbound right turn lane on Winchester Road leading to the 1-15 Southbound Onramp; 2) addition of a southbound dedicated left turn lane creating dual left turn lanes on the 1-15 Southbound Off-ramp; and 3) the widening of the off ramp to accommodate the added lane. Secondary improvements affect the southeast corner of Winchester Road and Jefferson Avenue and consist of the following: 1) acquisition of right of way along the south side of Winchester Road between Jefferson Avenue and the 1-15 Onramp to accommodate a dedicated freeway onramp right turn lane; and 2) traffic signal relocation at the southeast corner of the intersection and all related striping including crosswalk relocation. The right of way is in the process of being acquired. 1 R:~agenda reports~2003\0513\Winchester Rd Widening at I-15 Fwy affecting Jefferson Ave Bonds & Agmts The City required bonds and agreements for that portion of work affecting the southeast corner of Winchester Road and Jefferson Avenue. The developer submitted a Subdivision Improvement Agreement and bonds as follows: Faithful Performance Bond No. SX 0277 in the amount of $66,000 to secure improvements. Labor and Materials Bond No. SX 0277 in the amount of $33,000 for labor and materials. FISCAL IMPACT: ATTACHMENTS: None Location Map 2 R:',agenda reporls~2003\0513\Winchester Rd Widening at 1-15 Fwy affecting Jefferson Ave Bonds & Agmts dVlA~ NOIJ~VDO~I 1.1.0-01,~:-01,6 ~' ~I.O'OI, E-OI, 6 :NdV 0 0 Z ITEM 15 APPROVAL CiTY A'FFORNEY FINANCE DIRECTOR CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: ,/~City Manager/City Council /~William G. Hughes, Director of Public Works/City Engineer FROM: DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Parcel Map No. 26488 located north La Serena Wy., East of Calle Medusa, South of Nicolas Rd. and West of Butterfield Stage Rd. PREPARED BY:~_~Ronald J. Parks, Deputy Director of Public Works ~:~O~Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN PARCEL NO. 26488) BACKGROUND: Parcel Map No. 26488 was recorded by the County Recorder on March 3, 1999. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this Parcel have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Andrea Circle and a portion of Walcott Lane. Calle Chapos is not being accepted at this time because the improvements were not required by this Parcel Map. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN PARCEL NO. 26488) THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On March 3, 1999, the County Recorder recorded Parcel Map No. 26488 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Jay Van Der Wal, Janke Van Der Wal and Andrea H. Van Der Wah and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the Parcel have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 R:'~AGENDA REFOR TS'~2CO3x051303'~PM26488 StreetAcceptance.doc STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 R:'~AGENDA REPORTS',2003'~51303~PM26~88 S ti-eetAccepmnce.doc EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Parcel Map No. 26488 into the City-Maintained Street System as described below: Those portions of Parcel Map No. 26488 in the City of Temecula, County of Riverside, as filed in Book 193, Pages 62-63 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: Lot "A" (Portion of Walcott Lane from Calle Chapos to southern parcel boundary) of said Parcel Map No. 26488. Lot "C" (Andrea Circle) of said Parcel Map No. 26488. 4 R:'~AGENDA REPORTS'~.003~51303hUM26488 S treetAcceptance.doc EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP PCL 4' c~ I I U I ' PA~CEL MA? I. I ' PCb, CALLE . 'CHAPqS ' LOT B 87/.45 PCL, PARCEl. I pARCEL PA ~CEL PARC£C 4 VICINITY MAP PAF~C~ 5 ITEM 16 TO: FROM: DATE: SUBJECT: APPROVAL ~_.)~_ CITY ATTORNEY FINANCE DIRECTOR CITY MANAGER CITY OF TEMECULA AGENDA REPORT City Manager/City Council /V~William G. Hughes, Works/City Engineer Director of Public May 13, 2003 Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 21821 located north of Via Norte, East of Winchester Rd, South of Nicolas Rd. and West of Butterfleld Stage Rd. within the Meadowview Area. PREPARED BY:____~,~Ronald J. Parks, Deputy Director of Public Works ' ~Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 21821) BACKGROUND: Tract Map No. 21821 was recorded by the County Recorder on July 12, 1991. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Calle Fuente, portions of Calle Fiesta and Via Norte along the tract frontage. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. 1 R:'xAGENDA REPORTSX2003X051303\TM21821 StmetAcceptanc~.doc RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 21821) THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On July 12, 1991, the County Recorder recorded Tract Map No. 21821 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Bedford Development Company: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and ail repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 21821 into the City-Maintained Street System as described below: Those portions of Tract Map No. 21821 in the City of Temecula, County of Riverside, as filed in Book 233, Pages 58-61 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: Lot "A' (Portion of Calle Fiesta along the western tract boundary) of said Tract Map No. 21821. Lot "B" (Portion of Via Norte along the southern tract boundary) of said Tract Map No. 21821. Lot "C" (Calle Fuente) of said Tract Map No. 21821. 4 R:'~AGENDA REI~ORTS~2003~051303\TM21821 Street A_cceptance.doc EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP J MAP 273 27,5 \ 4 3 RANcHo T£MECULA 200 31,o vIA 5 R:~AGENDA REPORTS~2003X051303\TM21821 StreetAccepmace.doc ITEM 17 APPROVAL CITY A']-I'O RN EY ~-)~ FINANCE DIRECTOR ~ CiTY MANAGER CITY OF TEMECULA AGENDA REPORT TO: ~ j ~;ity Manager/City Council FROM: f~l/~Nilliam G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 23143-2 located north of De Portola Rd., East of Butterfield Stage Rd., South of Pauba Rd. and West of City Limits. PREPARED BY: ~'[~ Ronald J. Parks, Deputy Director of Public Works Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 23143-2) BACKGROUND: Tract Map No. 23143-2 was recorded by the County Recorder on July 1, 1999. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this Tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Brookway Drive, Shooter's Hill Road and portions of Butterfield Stage Road, Crowne Hill Drive, Fox Road, Via Sabino and Via Angeles. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACH M ENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. 1 RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 23143-2) THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On July 1, 1999, the County Recorder recorded Tract Map No. 23143-2 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Richmond American Homes of California, Inc.: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the Tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 R:~AGENDA REPORTS~2003'~51303\TM23143 -2 St~et3_cceptance.doc STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 23143-2 into the City-Maintained Street System as described below: Those portions of Tract Map No. 23143-2 in the City of Temecula, County of Riverside, as filed in Book 281, Pages 60-66 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "A" (Portion of Butterfield Stage Road along western tract boundary) of said Tract Map No. 23143-2. 2. Lot "B" (Portion of Crowne Hill Drive along northern tract boundary) of said Tract Map No. 23143-2. 3. Lot "C" (Brookway Drive) of said Tract Map No. 23143-2. 4. Lot "D" (Shooter's Hill Road) of said Tract Map No. 23143-2. 5. Lot "E" (Portion of Fox Road from Crowne Hill Dr. to eastern tract boundary) of said Tract Map No. 23143-2. 6. Lot "F" (Portion of Via Sabino from Fox Rd. to southern tract boundary) of said Tract Map No. 23143-2. 7. Lot "G" (Portion of Via Angeles from Fox Rd. to southern tract boundary) of said Tract Map No. 23143-2. 4 EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP SITE VICINITY MAP NOT TO SCALE 'REMAINDER' mI I $ R:'~AGENDA REPORTSX2003~051303\TM 23143-2 S an:elAcc~phance.doc ITEM 18 APPROVAL CITY ATTORNEY FINANCE DIRECTOR CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: ,~ity Manager/City Council FROM: f'f~J/I,WilliamZ! G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 23143-4 located north of De Portola Rd., East of Butter[ield Stage Rd., South of Pauba Rd. and West of City Limits. PREPARED BY: F~'~ Ronald J. Parks, Deputy Director of Public Works ~ ,~q. Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003-. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 23143-4) BACKGROUND: Tract Map No. 23143-4 was recorded by the County Recorder on July 1, 1999. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this Tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Manchester Court, Old Kent Road, Pudding Court, Knightsbridge Way, Nicholas Common, Victoria Court and portions of Crowne Hill Drive, Fox Road and Vermont Ave. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. 1 RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 23143-4) THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On July 1, 1999, the County Recorder recorded Tract Map No. 23143-4 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Richmond American Homes of California, Inc.: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the Tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor A'I-I'EST: Susan W. Jones, CMC, City Clerk R:X3_GENDA REFORTSX2003'O51303\TM 23143~4 StxeetAcceptaace.doc STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regula;' meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNClLMEMBERS: Susan W. Jones, CMC, City Clerk 3 EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 23143-4 into the City-Maintained Street System as described below: Those portions of Tract Map No. 23143-4 in the City of Temecula, County of Riverside, as filed in Book 281, Pages 74-81 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "A" (Portion of Crowne Hill Drive within tract boundary) of said Tract Map No. 23143-4. 2. Lot "B" (Manchester Court) of said Tract Map No. 23143-4. 3. Lot "C" (Old Kent Road) of said Tract Map No. 23143-4. 4. Lot "D" (Pudding Court north of Old Kent Road) of said Tract Map No. 23143-4. 5. Lot "E" (Pudding Court south of Old Kent Road) of said Tract Map No. 23143-4. 6. Lot "F" (Knightsbridge Way north of Old Kent Road) of said Tract Map No. 23143-4. 7. Lot "G" (Knightsbridge way south of Old Kent Road) of said Tract Map No. 23143-4. 8. Lot "H" (Fox Road from southern tract boundary to centerline intersection at Old Kent Road) of said Tract Map No. 23143-4. 9. Lot "H" (Vermont Avenue from centerline intersection at Old Kent Road to western tract boundary) of said Tract Map No. 23143-4. 10. Lot "1" (Nicholas Common) of said Tract Map No. 23143-4. 11. Lot "J" (Victoria Court) of said Tract Map No. 23143-4. 4 EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP SITE VICINITY MAP NOT TO SCALE 5 ITEM 19 APPROVAL CITY ATTORNEY FINANCE DIRECTOR CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: City Manager/City Council FROM: ~{~/illiam G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 24182-2 located north Highway 79 North, East of Meadows Parkway, South of De Portola Rd. and West of Buttedield Stage Rd. PREPARED BY.'~___~[~ Ronald J. Parks, Deputy Director of Public Works ~ Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 24182-2) BACKGROUND: Tract Map No. 24182-2 was recorded by the County Recorder on June 12, 1998. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Matera Ct. and portions of Rovato St., Volterra St., Teramo St., and Cenon Wy. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. I R:~AGENDA RF~ORTS~2003~051303[TM24182-2 S~reetAcceptance.doc RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 24182-2) THE CiTY COUNCIL OF THE CiTY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On June 12, 1998, the County Recorder recorded Tract Map No. 24182-2 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from CAL-Paseo Del Sol, LLC: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor A'I-I'EST: Susan W. Jones, CMC, City Clerk 2 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CiTY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 R:ka. GUmNDA RE[~RTSk2003'O51303 ~TM24182-2 SffeetAcceptance.doc EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 24182-2 into the City-Maintained Street System as described below: Those portions of Tract Map No. 24182-2 in the City of Temecula, County of Riverside, as filed in Book 271, Pages 32-37 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 2. 3. 4. 5. Lot "A" (Portion of Volterra St. from Rovato St. to northern tract boundary) of said Tract Map No. 24182-2. Lot "B" (Portion of Cenon Wy. from Volterra St. to eastern tract boundary) of said Tract Map No. 24182-2. Lot "C" (Portion of Rovato St. from Volterra St. to western tract boundary) of said Tract Map No. 24182-2. Lot "D" (Teramo St. from Rovato St. to northern tract boundary) of said Tract Map No. 24182-2. Lot "E" (Matera Court) of said Tract Map No. 24182-2. 4 EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP City ol ~cula TO SAN DIEGO VICINITY MAP NOT TO SCALE TRACT NO. 24182-2 PARCEIL NAP ~0. 5 ITEM 20 APPROVAL CITY ATTORNEY FINANCE DIRECTOR CiTY MANAGER CITY OF TEMECULA AGENDA REPORT TO: ,City ManagedCity Council FROM: "'~4/!VVilliam"~ G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 28503 located north La Serena Wy., East of Margarita Rd., South of Nicolas Rd. and West of Butterfield Stage Rd. PREPARED BY: ~Ronald J. Parks, Deputy Director of Public Works - .~Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 28503) BACKGROUND: Tract Map No. 28503 was recorded by the County Recorder on January 26, 1999. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are Chalon Ct., Jura Ct., Baret Ct. and portions of Cabern Ct. and La Serena Wy. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. ATTACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 28503) THE CITY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On January 26, 1999, the County Recorder recorded Tract Map No. 28503 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Bramalea California, LLC: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regula'r meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMO, City Clerk 3 R:'~_GF~NDA REPORTS~2~)3h051303\TM28503 StmetAcceptaace.doc EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 28503 into the City-Maintained Street System as described below: Those portions of Tract Map No. 28503 in the CRy of Temecula, County of Riverside, as filed in Book 277, Pages 14-18 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 4. 5. 6, Lot "A" (Portion of La Serena Way from tract western boundary to the western MWD right-of-way line along southern tract boundary) of said Tract Map No. 28503. Lot "B" (Portion of La Serena Way from MWD eastern right-of- way line to tract eastern boundary along southern tract boundary) of said Tract Map No. 28503. Lot "C" (Chalon Court) of said Tract Map No. 28503. Lot "D" (Jura Court) of said Tract Map No. 28503. Lot "E" (Baret Court) of said Tract Map No. 28503. Lot "F" (Cabern Court from Chalon Court to western MWD right-of-way line) of said Tract Map No. 28503. Lot "G" (Cabern Court from eastern MWD right-of-way line to end of cul-de-sac) of said Tract Map No. 28503. 4 ITEM 21 APPROVAL CITY ATTORNEY FINANCE DIRECTOR CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: City Manager/City Council FROM: ."~/~/Villiam G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Acceptance of certain Public Streets into the City-Maintained Street System within Tract Map No. 28850 located north Rancho California Rd., East of Ynez Rd., South of Margarita Rd. and West of Meadows Parkway. PREPARED BY: ['~ Ronald J. Parks, Deputy Director of Public Works Rene B. Martinez Jr., Engineering Technician RECOMMENDATION: That City Council adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 28850) BACKGROUND: Tract Map No. 28850 was recorded by the County Recorder on July 23, 1999. The owner dedicated to public use for street and public utility purposes streets designated as lettered lots on the map. The City Clerk accepted the offers of dedication. Public Works Staff reviewed and inspected the public improvements and all required repairs and replacements were satisfactorily completed. All Bonds associated with this Tract have been released. Therefore, staff recommends the acceptance of these streets into the City-Maintained Street System. The public streets now being accepted by this action are a portion of Margarita Rd. FISCAL IMPACT: Periodic surface and / or structural maintenance will be required every 5 to 8 years. A'I'I'ACHMENT: 1. Resolution No. 2003- 2. Vicinity Map with Exhibits "A-B", inclusive. 1 R:~AGENDA REFORTS~003~51303\TM28850 St~etAcceptance,doc 1 RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA ACCEPTING CERTAIN PUBLIC STREETS INTO THE CITY-MAINTAINED STREET SYSTEM (WITHIN TRACT NO. 28850) THE CiTY COUNCIL OF THE CITY OF TEMECULA DOES RESOLVE, DETERMINE AND ORDER AS FOLLOWS: WHEREAS, On July 23, 1999, the County Recorder recorded Tract Map No. 28850 in which an offer of dedication for street and public utility purposes was accepted by the City of Temecula from Richmond American Homes of California: and, WHEREAS, City Public Works Staff reviewed and inspected the public improvements and all repairs and replacements were satisfactorily completed: and, WHEREAS, All Bonds associated with the Tract have been released: and, NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Temecula hereby accepts into the City-Maintained Street System the streets and portions of streets offered to and accepted by the City of Temecula described in Exhibits "A" and "B" attached hereto. PASSED, APPROVED, AND ADOPTED, by the City Council of the City of Temecula at a regular meeting held on the 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk 2 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003- was duly and regularly adopted by the City Council of the City of Temecula at a regula;' meeting thereof held on 13th day of May, 2003, by the following vote: AYES: 0 NOES: 0 ABSENT: 0 ABSTAIN: 0 COUNClLMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk 3 EXHIBIT "A" TO RESOLUTION NO. 2003- Accepting several of the public streets offered to and accepted by the City of Temecula as indicated on Tract Map No. 28850 into the City-Maintained Street System as described below: Those portions of Tract Map No. 28850 in the City of Temecula, County of Riverside, as filed in Book 282, Pages 59-61 Inclusive, of Maps, in the Recorder's Office of said county, particularly described as follows: 1. Lot "A" (Portion of Margarita Road along the northern tract boundary) of said Tract Map No. 28850. 4 EXHIBIT "B" TO RESOLUTION NO. 2003- VICINITY MAP NOT l'O MAP 'C ' 20.5~4 AC. NET 20.838 AC. GROSS ~.OT I TRACT NO. M8 222/$4-$8 $ ITEM 22 TO: FROM: DATE: SUBJECT: APPROVAL /-~ CITY ATTO RN EY ~)~,,- DIRECTOR OF FIN,A/N~ ~ CITY MANAGER /_~/-- AGENDA REPORT City Manager/City Council William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Amendment No. 1 of the Annual Agreement for Professional Real Estate Appraisal Services With Mason & Mason Real Estate Appraisers Prepared By: Amer Attar, Principal Engineer Marilyn Adarbeh, Property Agent RECOMMENDATION: That the City Council approves Amendment No. 1 to the Annual Agreement for Professional Real Estate Appraisal Services between the City and Mason & Mason Real Estate Appraisers dated July 23, 2002, by increasing the cumulative annual amount by $15,450.00. BACKGROUND: On July 23, 2002, the City Council approved an Annual Agreement for Professional Real Estate Appraisal Services With Mason & Mason Real Estate Appraisers for a cumulative amount not to exceed $30,000. Under this agreement, staff has authorized work and obligated funds totaling $11,000.00. We have requested Mason & Mason to provide a proposal for appraisal services related to two projects that are scheduled for construction in the Fall of 2003. The two separate proposals are as follows: · Community Theatre, Project Number PW 02-23. Appraise properties needed to be acquired to provide access to the proposed new theatre: $9,500. · Winchester Road Widening, Project Number PW 00-27. Appraise the frontages of seven parcels needed to widen Winchester Road and Jefferson Avenue: $24,950.00. The total amount of the two proposals is $34,450.00. Currently, the balance under the annual agreement is $19,000.00. In order to proceed with appraising the required properties, the annual agreement ceiling need to be increased by $15,450.00, to the new not to exceed amount of $45,450.00. FISCAL IMPACT: The annual agreements do not have specific funding sources associated with them. Each specific project funds the work being done under the annual agreement. Sufficient funds are available for the Winchester Road Widening Project, Account Number 210-165-608-5801, and the Community Theater Project, Account Number 210-190- 167-5801, to cover the costs of the appraisals. Attachments: 1. Amendment No, 1 to the Annual Agreement for Professional Real Estate Appraisal Services With Mason & Mason Real Estate Appraisers. 2 R:'~,G EN DA REPO RTS~2003~051303~mend An n ualAgree Mason.dcc FIRST AMENDMENT TO AGREEMENT BETWEEN CITY OF TEMECULA AND MASON & MASON REAL ESTATE APPRASlERS & CONSULTANTS ANNUAL PROFESSIONAL APPRASlAL SERVICES THIS FIRST AMENDMENT is made and entered into as of May 13, 2003, 2002 by and between the City of Temecula, a municipal corporation ("City") and Mason & Mason Real Estate Appraisers & Consultants ("Consultant"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. This Amendment is made with respect to the following facts and purposes: A. On July 23, 2002 the Cityand Consultant entered into that certain agreement entitled "City of Temecula Agreement for Real Estate Appraisal Services ("Agreement") in the amount of $30,000.00 ("Agreement"). B. The parties now desire to increase the'payment for services in the amount of $15,450.00 and amend the Agreement as set forth in this Amendment. 2. Section 5 a of the Agreement is hereby amended to read as follows: The City agrees to pay consultant monthly, in accordance with the payment rates and terms and the schedule of payment as negotiated and as set forth in Exhibit B, Payment Rates and Scheduled, attached hereto and incorporated herein by this reference as though set forth in full, based upon actual time spent on the tasks as directed by the City on an as needed basis. Any terms in Exhibit B other than the payment rates are null and void. The first amendment amount shall not exceed Fifteen Thousand Four Hundred Fifty Dollars and No Cents ($15,450.00) for additional Real Estate Appraisal analysis studies for a total contract amount of Forty Five Thousand Four Hundred Fifty Dollars and No Cents ($45,450.00). 3. Except for the changes specifically set forth heroin, all other terms and conditions of the Agreement shall remain in full force and effect. I IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. CITY OF TEMECULA Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk Approved As to Form: Peter M. Thorson, City Attorney CONSULTANT Mason & Mason Real Estate Appraisers & Consultants 2609 Honolulu Ave., Suite 100 Montrose, CA 91020-1706 (818) 957-1881 Frances Wolfe Mason, President Frances Wolfe Mason, Secretary/Treasurer (Two Signatures Required For Corporations) 2 EXHIBIT B PAYMENT RATES AND SCHEDULE 1o r'~grmts~asters~annual contrac~2OO2-O3~tason & Mason appraisal FYO2-O3~aJp · $ON & MASO ' Real Estate Appraisers & Consultants 2609 Honolulu Avenue, Suite 100 Montrose, California 91020-1706 Telephone (818) 957-'1881 Fax (8'18) 957-189t e-malh fmason~ma$on2.com Frances Wolfe Mason. MN David S. Mason, MAI Usa M. Benson, MAI Vincent G. Maher, MAI CRE Kate C. McWaP. em, MAI Bradfoa:l D. Thompson, UAl Kendall Thurston, MAI Victoria L. Valen§ne, RM, MRED Robert W. Waters, MAI SR/WA 2002 STANDARD FEE SCHEDULE Compensation for work performed on a time-and-materials basis will be computed as follows through December 31, 2002: APPRAISAL SERVICES · Principal Appraiser · Associate Appraiser Research $200.00 to $300.00/hour $150.00 to $200.00/hour $65.00 to $100.00/hour EXPERT WITNESS SERVICES - Consultation, Deposition, and Court Appearance · Frances Wolfe Mason, MAI · David $. Mason, MAI · Vincent G. Maher, MAI CRE · Lisa M. Benson, MAI · Bradford D. Thompson, MAI · Kate C. McWatters, MAI SPA · Robert W. Waters, MAI, SR/WA · Victoria L. Valentine; RM, MRED $300.00/hour $300.00/hour $225.00 hour $175.00/hour $225.00/hour $225.00/hour $175.00/hour $150.00/hour Research Court Exhibit Preparation Minimum Charge for Deposition and Court Appearances $65.00 to $100.00/hour $30.00 to $65.00/hour 4 hours USPAP REVIEWS & COMPLIANCE CONSULTING · KendalIThurston, MAI $300.00/hour (Retired Director of Screening for Ethics & USPAP- Appraisal Institute) MISCELLANEOUS EXPENSES The following are billed at Cost plus 10%: · Subcontractor Services · Blue Printing Services and Printing · Court Exhibits · Long Distance Telephone Calls, Fax, etc. · Commercial Delivery Services · · Computer Services · Air Transportation and Travel Expenses · Automobile Travel @ $0.33 per mile ITEM 23 APPROVAL CITY ATTORNEY DIRECTOR OF FINAN,~E~ CITY MANAGER TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City ManagedCity Council William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Award of Construction Contract for the Slurry Seal Project - FY2002/2003 Project No. PW03-02 PREPARED BY: Greg Butler, Principal Engineer RECOMMENDATION: That the City Council: Award a construction for the Slurry Seal Project - FY2002/2003 to Sudhakar Company International, Inc. in the amount of $276,108.55 and authorize the Mayor to execute the contract. Authorize the City Manager to approve change orders not to exceed the contingency amount of $27,610.86, which is equal to 10% of the contract amount. BACKGROUND: On March 25, 2003 the City Council approved the Construction Plans and Specifications and authorized the Department of Public Works to solicit construction bids for the subject project. This year the project area includes most of the residential streets located in the Vail Ranch section of the City. The work to be performed includes: crack sealing, treatment of all oil stains, traffic control, application of Rubberized Asphalt Emulsion Slurry (REAS) and replacement of all pavement delineation. Four (4) bids were received and publicly opened on April 15, 2003. The results of the bid opening are as follows: 1. Sudhakar Company International, Inc. $276,108.55 2. California Pavement Maintenance Company, Inc. $276,233.27 3. American Asphalt South, Inc. $300,297.79 4. Pavement Coating Company $314,780.36 Staff has reviewed the bid proposals and found Sudhakar Company International, Inc. of Rialto, California to be the lowest responsible bidder for this project. Staff has contacted references and determined that Sudhakar has satisfactorily performed similar type of work in the past. The specifications allow fifteen (15) working days for completion of this project. Work is expected to begin in June 2003 and be completed by July 2003. A copy of the bid summary is available for review in the City Engineer's office. I R:\AGENDA REPORTSt2003\051303\PW0302.awd. DOC The Engineering estimate was $342,500. FISCAL IMPACT: The FY2002/2003 Slurry Seal project is funded by the Public Works Maintenance Division Routine Street Maintenance funds. The total project cost is $303,719.41, which includes the contract amount of $276,108.55 plus a 10% contingency amount of $27,610.86. Adequate funds are available in Account No. 001-164-601-5402. ATTACHMENTS: 1. Contract 2. Location map 2 R:',AGEN DA REPORTS~003\051303\PW0302.awd. DOC CITY OF TEMECULA, PUBLIC WORKS DEPARTMENT CONTRACT FOR PROJECT NO. PW03-02 SLURRY SEAL PROJECT- FY2002/2003 THIS CONTRACT, made and entered into the 13th day of May, 2003, by and between the City of Temecula, a municipal corporation, hereinafter referred to as "CITY", and Sudhakar Company International hereinafter referred to as "CONTRACTOR." WITNESSETH: That CITY and CONTRACTOR, for the consideration hereinafter named, mutually agree as follows: CONTRACT DOCUMENTS. The complete Contract includes all of the Contract Documents, to wit: Notice Inviting Bids, Instructions to Bidders, Proposal, Performance Bond, Labor and Materials Bond, Plans and Specifications entitled PROJECT NO. PW03- 02, SLURRY SEAL PROJECT - FY2002/2003, Insurance Forms, this Contract, and all modifications and amendments thereto, the State of California Department of Transportation Standard Specifications for Construction of Local Streets and Roads (Latest Ed.) where specifically referenced in the Plans and Technical Specifications, and the latest version of the Standard Specifications for Public Works Construction, including all supplements as written and promulgated by Public Works Standards, Inc. (hereinafter, "Standard Specifications") as amended by the General Specifications, Special Provisions, and Technical Specifications for PROJECT NO. PW03-02, SLURRY SEAL PROJECT - FY2002/2003. Copies of these Standard Specifications are available from the publisher: Building News, Incorporated 1612 South Clementine Street Anaheim, CA 92802 (714) 517-0970 The Standard Specifications will control the general provisions, construction materials, and construction methods for this Contract except as amended by the General Specifications, Special Provision, and Technical Specifications for PROJECT NO. PW03- 02, SLURRY SEAL PROJECT - FY2002/2003. In case of conflict between the Standard Specifications and the other Contract Documents, the other Contract Documents shall take precedence over, and be used in lieu of, such conflicting portions. Where the Contract Documents describe portions of the work in general terms, but not in complete detail, it is understood that the item is to be furnished and installed completed and in place and that only the best general practice is to be used. Unless otherwise specified, the CONTRACTOR shall furnish all labor, materials, tools, equipment, and incidentals, and do all the work involved in executing the Contract. CONTRACT CA-1 R:\CIP~PROJECTS~W0$~W03-02 Slurry Seal,Contract.doc The Contract Documents are complementary, and what is called for by anyone shall be as binding as if called for by all. Any conflict between this Contract and any other Contract Document shall be resolved in favor of this Contract. SCOPE OF WORK. CONTRACTOR shall perform everything required to be performed, shall provide and furnish all the labor, materials, necessary tools, expendable equipment, and all utility and transportation services required for the following: PROJECT NO. PW03-02, SLURRY SEAL PROJECT - FY200212003 All of said work to be performed and materials to be furnished shall be in strict accordance with the Drawings and Specifications and the provisions of the Contract Documents hereinabove enumerated and adopted by CITY. CITY APPROVAL. All labor, materials, tools, equipment, and services shall be furnished and work performed and completed under the direction and supervision, and subject to the approval of CITY or its authorized representatives. CONTRACT AMOUNT AND SCHEDULE. The CITY agrees to pay, and CONTRACTOR agrees to accept, in full payment for, the work agreed to be done, the sum of: TVVO HUNDRED SEVENTY SlX THOUSAND ONE HUNDRED EIGHT DOLLARS and FIFTY FIVE CENTS ($276,108.55), the total amount of the base bid. CONTRACTOR agrees to complete the work in a period not to exceed fifteen (15). working days, commencing with delivery of a Notice to Proceed by CITY. Construction shall not commence until bonds and insurance ara approved by CITY. CHANGE ORDERS. All change orders shall be approved by the City Council, except that the City Manager is hereby authorized by the City Council to make, by written order, changes or additions to the work in an amount not to exceed the contingency as established by the City Council. PAYMENTS LUMP SUM BID SCHEDULE: Before submittal of the first payment request, the CONTRACTOR shall submit to the City Engineer a schedule of values allocated to the various portions of the work, prepared in such form and supported by such data to substantiate its accuracy as the City Engineer may require. This schedule, as approved by the City Engineer, shall be used as the basis for reviewing the CONTRACTOR's payment requests. UNIT PRICE BID SCHEDULE: Pursuant to Section 20104.50 of the Public Contract Code, within thirty (30) days after submission of a payment request to the CITY, the CONTRACTOR shall be paid a sum equal to ninety percent (90%) of the value of the work completed according to the bid schedule. Payment request forms shall be submitted on or about the thirtieth (30th) day of each successive month as the work progresses. The final payment, if unencumbered, or any part thereof unencumbered, shall be CONTRACT CA-2 R:\CIP~PROJECTS~PW03~PW03-02 SlUrTy Seal~ContracLdoc made sixty (60) days after acceptance of final payment and the CONTRACTOR filing a one-year Warranty and an Affidavit of Final Release with the CITY on forms provided by the CITY. Payments shall be made on demands drawn in the manner required by law, accompanied by a certificate signed by the City Manager, stating that the work for which payment is demanded has been performed in accordance with the terms of the Contract, and that the amount stated in the certificate is due under the terms of the Contract. Partial payments on the Contract price shall not be considered as an acceptance of any part of the work. Interest shall be paid on all undisputed payment requests not paid within thirty (30) days pursuant to Public Contracts Code Section 20104.50. Public Contract Code Section 7107 is hereby incorporated by reference. In accordance with Section 9-3.2 of the Standard Specifications for Public Works Construction and Section 9203 of the Public Contract Code, a reduction in the retention may be requested by the Contractor for review and approval by the Engineer if the progress of the construction has been satisfactory, and the project is more than 50% complete. The Council hereby delegates its authority to reduce the retention to the Engineer. LIQUIDATED DAMAGES - EXTENSION OF TIME. In accordance with Government Code Section 53069.85, CONTRACTOR agrees to forfeit and pay to CITY the sum of one thousand dollars ($1,0(~0.00) per day for each calendar day completion is delayed beyond the time allowed pursuant to Paragraph 4 of this Contract. Such sum shall be deducted from any payments due to or to become due to CONTRACTOR. Such sum shall be deducted from any payments due to or to become due to CONTRACTOR. CONTRACTOR will be granted an extension of time and will not be assessed liquidated damages for unforeseeable delays beyond the control of, and without the fault or negligence of, the CONTRACTOR including delays caused by CITY. CONTRACTOR is required to promptly notify CITY of any such delay. WAIVER OF CLAIMS. On or before making each request for payment under Paragraph 6 above, CONTRACTOR shall submit to CITY, in writing, all claims for compensation as to work related to the payment. Unless the CONTRACTOR has disputed the amount of the payment, the acceptance by CONTRACTOR of each payment shall constitute a release of all claims against the CITY related to the payment. CONTRACTOR shall be required to execute an affidavit, release, and indemnity agreement with each claim for payment. PREVAILING WAGES. Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of workman needed to execute this Contract, from the Director of the Department of Industrial Relations. These rates are available from the California Department of Industrial Relation's Internet Web Site at http://www.dir, ca.gov. CONTRACTOR shall post a copy of such wage rates at the job site and shall pay the adopted prevailing wage rates as a minimum. CONTRACTOR shall comply with the provisions of Section 1773.8, 1775, 1776, 1777.5, 1777.6, and 1813 of the Labor Code. CONTRACT CA-3 R:\CIP~PROJECTS~PW03~PW03-02 Slurry Seal,Contract.doc 10. 11. 12. 13. 14. 15. 16. 17. Pursuant to the provisions of 1775 of the Labor Code, CONTRACTOR shall forfeit to the CITY, as a penalty, the sum of $25.00 for each calendar day, or portion thereof, for each laborer, worker, or mechanic employed, paid less than the stipulated prevailing rates for any work done under this Contract, by him or by any subcontractor under him, in violation of the provisions of the Contract. TIME OF THE ESSENCE. Time is of the essence in this contract. INDEMNIFICATION. All work covered by this Contract done at the site of construction or in preparing or delivering materials to the site shall be at the risk of CONTRACTOR alone. CONTRACTOR agrees to save, indemnify, hold harmless and defend CITY, its officers, employees, and agents, against any and all liability, injuries, or death of persons (CONTRACTOR's employees included) and damage to property, arising directly or indirectly out of the obligations herein undertaken or out of the operations conducted by CONTRACTOR, save and except claims or litigations arising through the sole active negligence or sole willful misconduct of the CITY. The CONTRACTOR shall indemnify and be responsible for reimbursing the CITY for any and all costs incurred by the CITY as a result of Stop Notices filed against the project. The CITY shall deduct such costs from Progress Payments or final payments due to the CITY. GRATUITIES. CONTRACTOR warrants that neither it nor any of its employees, agents, or representatives has offered or given any gratuities or promises to CITY's employees, agents, or representatives with a view toward securing this Contract or securing favorable treatment with respect thereto. CONFLICT OF INTEREST. CONTRACTOR warrants that he has no blood or marriage relationship, and that he is not in any way associated with any City officer or employee, or any architect, engineer, or other preparers of the Drawings and Specifications for this project. CONTRACTOR further warrants that no person in its employ has been employed by the CITY within one year of the date of the Notice Inviting Bids. CONTRACTOR'S AFFIDAVIT. After the completion of the work contemplated by this Contract, CONTRACTOR shall file with the City Manager, its affidavit stating that all workmen and persons employed, all firms supplying materials, and all subcontractors upon the Project have been paid in full, and that there are no claims outstanding against the Project for either labor or materials, except certain items, if any, to be set forth in an affidavit covering disputed claims or items in connection with a Stop Notice which has been filed under the provisions of the laws of the State of California. NOTICE TO CITY OF LABOR DISPUTES. Whenever CONTRACTOR has knowledge that any actual or potential labor dispute is delaying or threatens to delay the timely performance of the Contract, CONTRACTOR shall immediately give notice thereof, including all relevant information with respect thereto, to CITY. BOOKS AND RECORDS. CONTRACTOR's books, records, and plans or such part thereof as may be engaged in the performance of this Contract, shall at all reasonable times be subject to inspection and audit by any authorized representative of the CITY. INSPECTION. The work shall be subject to inspection and testing by CITY and its authorized representatives during manufacture and construction and all other times and CONTRACT CA~I R:\CIP~PROJ ECTS~PW03\PW03q}2 Slum/Seal~ContracLdoc 18. 19. 20. 21. 22. places, including without limitation, the plans of CONTRACTOR and any of its suppliers. CONTRACTOR shall provide all reasonable facilities and assistance for the safety and convenience of inspectors. All inspections and tests shall be performed in such manner as to not unduly delay the work. The work shall be subject to final inspection and acceptance notwithstanding any payments or other prior inspections. Such final inspection shall be made within a reasonable time after completion of the work. DISCRIMINATION. CONTRACTOR represents that it has not, and agrees that it will not, discriminate in its employment practices on the basis of race, creed, religion, national origin, color, sex age, or handicap. GOVERNING LAW. The City and Contractor understand and agree that the laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Contract and also govern the interpretation of this Contract. Any litigation concerning this Contract shall take place in the municipal, superior, or federal district court with geographic jurisdiction over the City of Temecula. In the event of litigation between the parties concerning this Contract, the prevailing party as determined by the Court, shall be entitled to actual and reasonable attorney fees and litigation costs incurred in the litigation. PROHIBITED INTEREST. No member, officer, or employee of the City of Temecula or of a local public body shall have any interest, direct or indirect, in the contract of the proceeds thereof during his/her tenure or for one year thereafter. Furthermore, the contractor/consultant covenants and agrees to their knowledge that no board member, officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the contracting party other than the City of Temecula, and that if any such interest comes to the knowledge of either party at any time, a full and complete disclosure of all such information will be made, in writing, to the other party or parties, even if such interest would not be considered a conflict of interest under Article 4 (commencing with Section 1090) or Article 4.6 (commencing with Section 1220) of Division 4 of Title I of the Government Code of the State of California. ADA REQUIREMENTS. By signing this contract, Contractor certifies that the Contractor is in total compliance with the Americans with Disabilities Act of 1990, Public Law 101- 336, as amended. WRITTEN NOTICE. Any written notice required to be given in any part of the Contract Documents shall be performed by depositing the same in the U.S. Mail, postage prepaid, directed to the address of the CONTRACTOR as set forth in the Contract Documents, and to the CITY addressed as follows: Mailing Address; William G. Hughes Director of Public Works/City Engineer City of Temecula P.O. Box 9033 Temecula, CA 92589-9033 Street Address: William G. Hughes Director of Public Works/City Engineer City of Temecula 43200 Business Park Drive Temecula, CA 92590-3606 CONTRACT CA-5 R:~CIP~PROJECTS~PW03\PW03~)2 Sluny Sear~Contract.doc IN WITNESS WHEREOF, the parties hereto have caused this Contract to be executed on the date first above written. DATED: CONTRACTOR Sudhakar Company International 1450 N. Fitzgerald Ave. Rialto, CA 92376 (909) 879-2933 By: Steve Fleener, Vice President By: Print or type NAME & TITLE (Signatures of two corporate officers required for Corporations) DATED: CITY OF TEMECULA APPROVED AS TO FORM: By: Jeffrey E. Stone, Mayor Peter M. Thorson, City Attorney Al-rEST: Susan W. Jones, CMC, City Clerk CONTRACT CA-6 R:~CIP~PROJECTS~PWO3~PW03-02 Slurry Seal~Contract.dec ITEM 24 APPROVAL CITY ATTORNEY ~)/"(-/~ DIRECTOR OF FINANCE~ CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: FROM: City Manager/City Council J )j~Villiam G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Award of Construction Contract for the Citywide Concrete Repairs - FY2002/2003, Project No. PW03-03 PREPARED BY: /.~/~Greg Butler, Principal Engineer /-/~r'Scott Harvey, Associate Engineer RECOMMENDATION: That the City Council: Award a construction for the Citywide Concrete Repairs - FY2002/2003, Project No. PW03- 03 to Malton Construction in the amount of $58,327.50 and authorize the Mayor to execute the contract. Authorize the City Manager to approve change orders not to exceed the contingency amount of $5,837.50 which is equal to 10% of the contract amount. BACKGROUND: On April 8, 2003 the City Council approved the Construction Plans and Specifications and authorized the Department of Public Works to solicit construction bids for the subject project. The Public Works Maintenance Division has completed their annual survey of damaged City maintained concrete improvements which include sidewalks, curb & gutter, cross gutters and driveway approaches. The facilities needing immediate repair are included in this project and have been grouped into localized areas to allow for cost effective bidding. Three (3) bids were received and publicly opened on April 29, 2003. The results of the bid opening are as follows: 1. Malton Construction $58,327.50 2. International Pavement Solutions, Inc. $59,839.00 3. J.M. Scibilia, Inc. $90,479.25 Staff has reviewed the bid proposals and found Malton Construction of Riverside, California to be the lowest responsible bidder for this project. Staff has contacted references and determined that Malton Construction has satisfactorily performed similar type of work in the past. The specifications allow forty (40) working days for completion of this project. Work is expected to begin in June 2003 and be completed by July 2003. A copy of the bid summary is available for review in the City Engineer's office. 1 R:~AGENDA REPORTS~003~051303\PW0303.awd. DOC The Engineering estimate was $67,500.00. FISCAL IMPACT: The FY2002/2003 Citywide Concrete Repairs project is funded by the Public Works Maintenance Division Routine Street Maintenance funds. The total project cost is $64,160.25, which includes the contract amount of $58,327.50 plus a 10% contingency amount of $5,832.75. Adequate funds are available in Account No. 001-164-601-5402. ATFACHMENTS: 1. Contract 2 R:~AGENDA REPORTS~003~051303~PW0303.awd. DOC CITY OF TEMECULA, PUBLIC WORKS DEPARTMENT CONTRACT FOR PROJECT NO. PW03-03 CITYWIDE CONCRETE REPAIRS - FY2002/2003 THIS CONTRACT, made and entered into the 13t" day of May, 2003, by and between the City of Temecula, a municipal corporation, hereinafter referred to as "CITY", and Malton Construction, hereinafter referred to as "CONTRACTOR." WITNESSETH: That CITY and CONTRACTOR, for the consideration hereinafter named, mutually agree as follows: CONTRACT DOCUMENTS. The complete Contract includes all of the Contract Documents, to wit: Notice Inviting Bids, Instructions to Bidders, Proposal, Performance Bond, Labor and Materials Bond, Plans and Specifications entitled PROJECT NO. PW03- 03, ClTYWIDE CONCRETE REPAIRS - FY200212003, Insurance Forms, this Contract, and all modifications and amendments thereto, the State of California Department of Transportation Standard Specifications for Construction of Local Streets and Roads (Latest Ed.) where specifically referenced in the Plans and Technical Specifications, and the latest version of the Standard Specifications for Public Works Construction, including all supplements as written and promulgated by Public Works Standards, Inc. (hereinafter, "Standard Specifications") as amended by the General Specifications, Special Provisions, and Technical Specifications for PROJECT NO. PW03-03, CITYVVlDE CONCRETE REPAIRS - FY2002/2003. Copies of these Standard Specifications are available from the publisher: Building News, Incorporated 1612 South Clementine Street Anaheim, CA 92802 (714)517-0970 The Standard Specifications will control the general provisions, construction materials, and construction methods for this Contract except as amended by the General Specifications, Special Provision, and Technical Specifications for PROJECT NO. PW03- 03, CITYWlDE CONCRETE REPAIRS - FY2002/2003. In case of conflict between the Standard Specifications and the other Contract Documents, the other Contract Documents shall take precedence over, and be used in lieu of, such conflicting portions. Where the Contract Documents describe portions of the work in general terms, but not in complete detail, it is understood that the item is to be furnished and installed completed and in place and that only the best general practice is to be used. Unless otherwise specified, the CONTRACTOR shall furnish all labor, materials, tools, equipment, and incidentals, and do all the work involved in executing the Contract. CONTRACT CA-1 R:\ClP~PROJ ECTS\PW03\PW03-03 PCC Repairs~CONTRACT.doc The Contract Documents are complementary, and what is celled for by anyone shall be as binding as if celled for by all. Any conflict between this Contract and any other Contract Document shall be resolved in favor of this Contract. SCOPE OF WORK. CONTRACTOR shall perform everything required to be performed, shall provide and furnish all the labor, materials, necessary tools, expendable equipment, and all utility and transportation services required for the following: PROJECT NO. PW03-03, CI~IDE CONCRETE REPAIRS - FY2002/2003 All of said work to be performed and materials to be furnished shall be in strict accordance with the Drawings and Specificetions and the provisions of the Contract Documents hereinabove enumerated and adopted by CITY. CITY APPROVAL. All labor, materials, tools, equipment, and services shall be furnished and work performed and completed under the direction and supervision, and subject to the approval of CITY or its authorized representatives. CONTRACT AMOUNT AND SCHEDULE. The CITY agrees to pay, and CONTRACTOR agrees to accept, in full payment for, the work agreed to be done, the sum of: FIFTY- EIGHT THOUSAND THREE HUNDRED TVVENTY SEVEN DOLLARS AND FIFTY CENTS ($58,327.50), the total amount of the base bid. CONTRACTOR agrees to complete the work in a period not to exceed forty (40) working days, commencing with delivery of a Notice to Proceed by CITY. Construction shall not commence until bonds and insurance are approved by CITY. CHANGE ORDERS. All change orders shall be approved by the City Council, except that the City Manager is hereby authorized by the City Council to make, by written order, changes or additions to the work in an amount not to exceed the contingency as established by the City Council. PAYMENTS LUMP SUM BID SCHEDULE: Before submittal of the first payment request, the CONTRACTOR shall submit to the City Engineer a schedule of values allocated to the various portions of the work, prepared in such form and supported by such data to substantiate its accuracy as the City Engineer may require. This schedule, as approved by the City Engineer, shall be used as the basis for reviewing the CONTRACTOR's payment requests. UNIT PRICE BID SCHEDULE: Pursuant to Section 20104.50 of the Public Contract Code, within thirty (30) days after submission of a payment request to the CITY, the CONTRACTOR shall be paid a sum equal to ninety percent (90%) of the value of the work completed according to the bid schedule. Payment request forms shall be submitted on or about the thirtieth (30th) day of each successive month as the work progresses. The final payment, if unencumbered, or any part thereof unencumbered, shall be CONTRACT CA-2 R:\CIP~PROJECTS\PW03~PW03~3 PCC Repairs\CONTRACT.doc made sixty (60) days after acceptance of final payment and the CONTRACTOR filing a one-year Warranty and an Affidavit of Final Release with the CITY on forms provided by the CITY. Payments shall be made on demands drawn in the manner required by law, accompanied by a certificate signed by the City Manager, stating that the work for which payment is demanded has been performed in accordance with the terms of the Contract, and that the amount stated in the certificate is due under the terms of the Contract. Partial payments on the Contract price shall not be considered as an acceptance of any part of the work. Interest shall be paid on all undisputed payment requests not paid within thirty (30) days pursuant to Public Contracts Code Section 20104.50. Public Contract Code Section 7107 is hereby incorporated by reference. In accordance with Section 9-3.2 of the Standard Specifications for Public Works Construction and Section 9203 of the Public Contract Code, a reduction in the retention may be requested by the Contractor for review and approval by the Engineer if the progress of the construction has been satisfactory, and the project is more than 50% complete. The Council hereby delegates its authority to reduce the retention to the Engineer. LIQUIDATED DAMAGES - EXTENSION OF TIME. In accordance with Government Code Section 53069.85, CONTRACTOR agrees to forfeit and pay to CITY the sum of one thousand dollars ($1,000.00) per day for each calendar day completion is delayed beyond the time allowed pursuant to Paragraph 4 of this Contract. Such sum shall be deducted from any payments due to or to become due to CONTRACTOR. Such sum shall be deducted from any payments due to or to become due to CONTRACTOR. CONTRACTOR will be granted an extension of time and will not be assessed liquidated damages for unforeseeable delays beyond the control of, and without the fault or negligence of, the CONTRACTOR including delays caused by CITY. CONTRACTOR is required to promptly notify CITY of any such delay. WAIVER OF CLAIMS. On or before making each request for payment under Paragraph 6 above, CONTRACTOR shall submit to CITY, in writing, all claims for compensation as to work related to the payment. Unless the CONTRACTOR has disputed the amount of the payment, the acceptance by CONTRACTOR of each payment shall constitute a release of all claims against the CITY related to the payment. CONTRACTOR shall be required to execute an affidavit, release, and indemnity agreement with each claim for payment. PREVAILING WAGES. Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of workman needed to execute this Contract, from the Director of the Department of Industrial Relations. These rates are available from the California Department of Industrial Relation's Internet Web Site at http:/h, vww.dir, ca.gov. CONTRACTOR shall post a copy of such wage rates at the job site and shall pay the adopted prevailing wage rates as a minimum. CONTRACTOR shall comply with the provisions of Section 1773.8, 1775, 1776, 1777.5, 1777.6, and 1813 of the Labor Code. CONTRACT CA-3 R:~CIP~PROJECTS~W03\PW03q)3 PCC Repairs\CONTRACT.doc 10. 11. 12. 13. 14. 15. 16. 17. Pursuant to the provisions of 1775 of the Labor Code, CONTRACTOR shall forfeit to the CITY, as a penalty, the sum of $25.00 for each calendar day, or portion thereof, for each laborer, worker, or mechanic employed, paid less than the stipulated prevailing rates for any work done under this Contract, by him or by any subcontractor under him, in violation of the provisions of the Contract. TIME OF THE ESSENCE. Time is of the essence in this contract. INDEMNIFICATION. All work covered by this Contract done at the site of construction or in preparing or delivering materials to the site shall be at the risk of CONTRACTOR alone. CONTRACTOR agrees to save, indemnify, hold harmless and defend CITY, its officers, employees, and agents, against any and all liability, injuries, or death of persons (CONTRACTOR's employees included) and damage to property, arising directly or indirectly out of the obligations herein undertaken or out of the operations conducted by CONTRACTOR, save and except claims or litigations arising through the sole active negligence or sole willful misconduct of the CITY. The CONTRACTOR shall indemnify and be responsible for reimbursing the CITY for any and all costs incurred by the CITY as a result of Stop Notices filed against the project. The CITY shall deduct such costs from Progress Payments or final payments due to the CITY. GRATUITIES. CONTRACTOR warrants that neither it nor any of its employees, agents, or representatives has offered or given any gratuities or promises to CITY's employees, agents, or representatives with a view toward securing this Contract or securing favorable treatment with respect thereto. CONFLICT OF INTEREST. CONTRACTOR warrants that he has no blood or marriage relationship, and that he is not in any way associated with any City officer or employee, or any architect, engineer, or other preparers of the Drawings and Specifications for this project. CONTRACTOR further warrants that no person in its employ has been employed by the CITY within one year of the date of the Notice Inviting Bids. CONTRACTOR'S AFFIDAVIT. After the completion of the work contemplated by this Contract, CONTRACTOR shall file with the City Manager, its affidavit stating that all workmen and persons employed, all firms supplying materials, and all subcontractors upon the Project have been paid in full, and that there are no claims outstanding against the Project for either labor or materials, except certain items, if any, to be set forth in an affidavit covering disputed claims or items in connection with a Stop Notice which has been filed under the provisions of the laws of the State of California. NOTICE TO CITY OF LABOR DISPUTES. Whenever CONTRACTOR has knowledge that any actual or potential labor dispute is delaying or threatens to delay the timely performance of the Contract, CONTRACTOR shall immediately give notice thereof, including all relevant information with respect thereto, to CITY. BOOKS AND RECORDS. CONTRACTOR's books, records, and plans or such part thereof as may be engaged in the performance of this Contract, shall at all reasonable times be subject to inspection and audit by any authorized representative of the CITY. INSPECTION. The work shall be subject to inspection and testing by CITY and its authorized representatives during manufacture and construction and all other times and CONTRACT CA-4 R:\CIP~ROJECTS\PW03~PW03-03 PCC Repairs\CONTRACT.doc 18. 19. 20. 21. 22. places, including without limitation, the plans of CONTRACTOR and any of its suppliers. CONTRACTOR shall provide all reasonable facilities and assistance for the safety and convenience of inspectors. All inspections and tests shall be performed in such manner as to not unduly delay the work. The work shall be subject to final inspection and acceptance notwithstanding any payments or other prior inspections. Such final inspection shall be made within a reasonable time after completion of the work. DISCRIMINATION. CONTRACTOR represents that it has not, and agrees that it will not, discriminate in its employment practices on the basis of race, creed, religion, national origin, color, sex age, or handicap. GOVERNING LAW. The City and Contractor understand and agree that the laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Contract and also govern the interpretation of this Contract. Any litigation concerning this Contract shall take place in the municipal, superior, or federal district court with geographic jurisdiction over the City of Temecula. In the event of litigation between the parties concerning this Contract, the prevailing party as determined by the Court, shall be entitled to actual and reasonable attorney fees and litigation costs incurred in the litigation. PROHIBITED INTEREST. No member, officer, or employee of the City of Temecula or of a local public body shall have any interest, direct or indirect, in the contract of the proceeds thereof during his/her tenure or for one year thereafter. Furthermore, the contractor/consultant covenants and agrees to their knowledge that no board member, officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the contracting party other than the City of Temecula, and that if any such interest comes to the knowledge of either party at any time, a full and complete disclosure of all such information will be made, in writing, to the other party or parties, even if such interest would not be considered a conflict of interest under Article 4 (commencing with Section 1090) or Article 4.6 (commencing with Section 1220) of Division 4 of Title I of the Government Code of the State of California. ADA REQUIREMENTS. By signing this contract, Contractor certifies that the Contractor is in total compliance with the Americans with Disabilities Act of 1990, Public Law 101- 336, as amended. WRITTEN NOTICE. Any written notice required to be given in any part of the Contract Documents shall be performed by depositing the same in the U.S. Mail, postage prepaid, directed to the address of the CONTRACTOR as set forth in the Contract Documents, and to the CITY addressed as follows: Mailing Address: William G. Hughes Director of Public Works/City Engineer City of Temecula P.O. Box 9033 Temecula, CA 92589-9033 Street Address: William G. Hughes Director of Public Works/City Engineer City of Temecula 43200 Business Park Drive Temecula, CA 92590-3606 CONTRACT CA~5 R:~CIP~PROJECTS~WO3~PW03-03 PCC Repairs~CONTRACT.doc IN WITNESS WHEREOF, the parties hereto have caused this Contract to be executed on the date first above wdtten. DATED: CONTRACTOR Malton Construction P.O. Box 4185 Riverside, CA 92514 (909) 776-9227 Dwight Sexton, Partner By:. Print or type NAME and TITLE DATED: (Signatures of two corporate officers required for Corporations) APPROVED AS TO FORM: CITY OFTEMECULA By: Jeffrey E. Stone, Mayor Peter M. Thorson, City Attorney ATTEST: Susan W. Jones, CMC, City Clerk CONTRACT CA~ R:\CIP~PROJECTS~PW03~PW03~)3 PCC Repairs~CONTRACT.dcc ITEM 25 APPROVAL CITY ATTORNEY DIRECTOR OF FINANCE CITY MANAGER TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City Manager/City Council ~,~William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Professional Services Agreement for Geotechnical and Material Testing Services, and Special Inspection - Kleinfelder, Inc. Rancho California Road Bridge Widening Over Murdeta Creek, Project No. PW99-18 PREPARED BY: Greg Butler, Principal Engineer - Capital Projects Steve Charette, Assistant Engineer - Capital Projects RECOMMENDATION: That the City Council: Approve an agreement with Kleinfelder, Inc. in an amount not to exceed $80,328.00 to provide as needed geotechnical, material testing services, and special inspection for the Rancho California Road Bridge Widening Over Murrieta Creek Improvements, Project No. PW99-18, and authorize the Mayor to execute the agreement. Authorize the City Manager to approve amendments to the agreement not to exceed the contingency amount of $8,032.80, which is equal to 10% of the agreement amount. BACKGROUND: The Rancho California Road Bridge Widening Over Murrieta Creek Improvements, Project No. PW99-18 will require geotechnical, materials testing, and special inspection services. The contract with Kleinfelder, Inc. will provide the needed professional services for the project. On April 22, 2003, the City Council awarded a construction contract for the Rancho California Road Bridge Widening Over Murrieta Creek Improvements, Project No. PW99-18, to MCM Construction, Inc. Thereafter, City staff evaluated four proposals received for geotechnical, materials testing, and special inspection services for the subject project. Kleinfelder, Inc. was selected to provide the needed services based upon their experience with similar projects, previous work performed for the City, and their expertise with specific task assignments. This Professional Services Agreement with Kleinfelder, Inc is for an amount not to exceed $80,328.00. FISCAL IMPACT: The Rancho California Bridge Widening Over Murrieta Creek Project is funded through Redevelopment Agency funds and Development Impact Fees (Street Improvements). The total agreement amount is $88,360.80 which includes the agreement amount of $80,328.00 plus a 10% contingency amount of $8,032.80. Adequate funds are available in Account No. 210-165-710-5804. ATTACHMENTS: Agreement with Kleinfelder, Inc. CITY OF TEMECULA AGREEMENT FOR GEOTECHNICAL MATERIAL TESTING & SPECIAL INSPECTION RANCHO CALIFORNIA ROAD BRIDGE WIDENING OVER MURRIETA CREEK PROJECT NO. PW99-18 THIS AGREEMENT, is made and effective as of May 13, 2003, between the City of Temecula, a municipal corporation ("City") and Kleinfelder, Inc., ("Consultant"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. TERM. This Agreement shall commence on May 13, 2003, and shall remain and continue in effect until tasks described herein are completed, but in no event later than December 31, 2004, unless sooner terminated pursuant to the previsions of this Agreement. 2. SERVICES. Consultant shall perform the services and tasks described and set forth in Exhibit A, attached hereto and incorporated herein as though set forth in full. Consultant shall complete the tasks according to the schedule of performance which is also set forth in Exhibit A. 3. PERFORMANCE. Consultant shall at all times faithfully, competently and to the best of his or her ability, experience, and talent, perform all tasks described herein. Consultant shall employ, at a minimum, generally accepted standards and practices utilized by persons engaged in providing similar services as are required of Consultant hereunder in meeting its obligations under this Agreement. 4. PREVAILING WAGES. Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of workman needed to execute this Contractor from the Director of the Department of Industrial Relations. These rates are on file with the City Clerk. Copies may be obtained at cost at the City Clerk's office of Temecula. Consultant shall provide a copy of prevailing wage rates to any staff or sub-contractor hired, and shall pay the adopted prevailing wage rates as a minimum. Consultant shall comply with the provisions of Sections 1773.8, 1775, 1776, 1777.5, 1777.6, and 1813 of the Labor Code. Pursuant to the provisions of 1775 of the Labor Code, Consultant shall forfeit to the City, as a penalty, the sum of $25.00 for each calendar day, or portion thereof, for each laborer, worker, or mechanic employed, paid less than the stipulated prevailing rates for any work done under this contract, by him or by any subcontractor under him, in violation of the provisions of the Contract. 5. PAYMENT. a. The City agrees to pay Consultant monthly, in accordance with the payment rates and terms and the schedule of payment as set forth in Exhibit B, Payment Rates and Schedule, attached hereto and incorporated herein by this reference as though set forth in full, based upon actual time spent on the above tasks. Any terms in Exhibit B other than the payment rates and schedule of payment are null and void. This amount shall not exceed Eighty Thousand Three Hundred Twenty-Eight Dollars and No Cents ($80,328.00) for the total term of the Agreement unless additional payment is approved as provided in this Agreement. b. Consultant shall not be compensated for any services rendered in connection with its pedormance of this Agreement which are in addition to those set forth herein, unless such 1 r:\cip~projects~pwgg-I 8~agrmts\Kleinfelder Agrmt additional services am authorized in advance and in writing by the City Manager. Consultant shall be compensated for any additional services in the amounts and in the manner as agreed to by City Manager and Consultant at the time City's written authorization is given to Consultant for the performance of said services. c. Consultant will submit invoices monthly for actual services performed. Invoices shall be submitted between the first and fifteenth business day of each month, for services provided in the previous month. Payment shall be made within thirty (30) days of receipt of each invoice as to all nondisputed fees. If the City disputes any of consultant's fees it shall give written notice to Consultant within 30 days of receipt of a invoice of any disputed fees set forth on the invoice. 6. SUSPENSION OR TERMINATION OF AGREEMENT WITHOUT CAUSE. a. The City may at any time, for any reason, with or without cause, suspend or terminate this Agreement, or any portion hereof, by serving upon the consultant at least ten (10) days prior written notice. Upon receipt of said notice, the Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise. If the City suspends or terminates a portion of this Agreement such suspension or termination shall not make void or invalidate the remainder of this Agreement. b. In the event this Agreement is terminated pursuant to this Section, the City shall pay to Consultant the actual value of the work performed up to the time of termination, provided that the work performed is of value to the City. Upon termination of the Agreement pursuant to this Section, the Consultant will submit an invoice to the City pursuant to Section 4. 7. DEFAULT OF CONSULTANT. a. The Consultant's failure to comply with the provisions of this Agreement shall constitute a default. In the event that Consultant is in default for cause under the terms of this Agreement, City shall have no obligation or duty to continue compensating Consultant for any work performed after the date of default and can terminate this Agreement immediately by written notice to the Consultant. If such failure by the Consultant to make progress in the performance of work hereunder arises out of causes beyond the Consultant's control, and without fault or negligence of the Consultant, it shall not be considered a default. r:\cip~projects~w99-18~agrmts'~41einfelder Agrmt b. If the City Manager or his delegate determines that the Consultant is in default in the performance of any of the terms or conditions of this Agreement, it shall serve the Consultant with written notice of the default. The Consultant shall have (10) days after service upon it of said notice in which to cure the default by rendering a satisfactory performance. In the event that the Consultant fails to cure its default within such period of time, the City shall have the right, notwithstanding any other prevision of this Agreement, to terminate this Agreement without further notice and without prejudice to any other remedy to which it may be entitled at law, in equity or under this Agreement. 8. OWNERSHIP OF DOCUMENTS. a. Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be maintained in accordance with generally accepted accounting principles and shall be clearly identi- fled and readily accessible. Consultant shall provide free access to the representatives of City or its designees at reasonable times to such books and records, shall give City the dght to examine and audit said books and records, shall permit City to make transcripts there from as necessary, and shall allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained fora period of three (3) years after receipt of final payment. b. Upon completion of, or in the event of termination or suspension of this Agreement, all original documents, designs, drawings, maps, models, computer files containing data generated for the work, surveys, notes, and other documents prepared in the course of providing the services to be performed pursuant to this'Agreement shall become the sole property of the City and may be used, reused or otherwise disposed of by the City without the permission of the Consultant. With respect to computer files containing data generated for the work, Consultant shall make available to the City, upon reasonable wdtten request by the City, the necessary computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. c. With respect to the design of public improvements, the Consultant shall not be liable for any injuries or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the written consent of the Consultant. 9. INDEMNIFICATION. The Consultant agrees to defend, indemnify, protect and hold harmless the City, its officers, officials, employees and volunteers from and against any and all claims, demands, losses, defense costs or expenses, including attorney fees and expert witness fees, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to preperty arising out of Consultant's negligent or wrengful acts or omissions arising out of or in any way related to the performance or non-performance of this Agreement, excepting only liability arising out of the negligence of the City. 10. INSURANCE REQUIREMENTS. Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to preperty which may arise frem or in connection with the performance of the work hereunder by the Consultant, its agents, representatives, or employees. 3 r:\cip~ roj e cts~ow99-18~grmts\Klein felder Agrmt Minimum Scope of Insurance. Coverage shall be at least as broad as: (1) Insurance Services Office Commercial General Liability form No. CG 00 01 11 85 or 88. (2) Insurance Services Office Business Auto Coverage form CA 00 01 06 92 covering Automobile Liability, code 1 (any auto). If the Consultant owns no automobiles, a non-owned auto endorsement to the General Liability policy described above is acceptable. (3) Worker's Compensation insurance as required by the State of California and Employer's Liability Insurance. If the Consultant has no employees while performing under this Agreement, worker's compensation insurance is not required, but Consultant shall execute a declaration that it has no employees. (4) Professional Liability Insurance shall be written on a policy form providing professional liability for the Consultant's profession. Minimum Limits of Insurance. Consultant shall maintain limits no less than: (1) General Liability: One Million Dollars $1,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this projectJlocation or the general aggregate limit shall be twice the required occurrence limit. (2) Automobile Liability: One Million Dollars ($1,000,000) per accident for bodily injury and property damage. (3) Worker's Compensation as required by the State of California; Employer's Liability: One million dollars ($1,000,000) per accident for bodily injury or disease. (4) Professional Liability coverage: Two Million Dollars ($2,000,000) per claim and in aggregate. c. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City Manager. At the option of the City Manager, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees and volunteers; or the Consultant shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. d. Other Insurance Provisions. The general liability and automobile liability policies ara to contain, or be endorsed to contain, the following provisions: (1) The City, its officers, officials, employees and volunteers are to be covered as insureds as respects: liability arising out of activities performed byor on behalf of the Consultant; products and completed operations of the Consultant; premises owned, occupied or used by the Consultant; or automobiles owned, leased, hired or borrowed by the Consultant. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees or volunteers. (2) For any claims related to this project, the Consultant's insurance coverage shall be pdmary insurance as respects the City, its officers, officials, employees and volunteers. Any insurance or self-insured maintained bythe City, its officers, officials, employees or volunteers shall be excess of the Consultant's insurance and shall not contribute with it. (3) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers. (4) The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. (5) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. e. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City. Self insurance shall not be considered to comply with these insurance requirements. f. Verification of Coverage. Consultant shall furnish the City with original endorsements effecting coverage required by this clause. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. The endorsements are to be on forms provided by the City. All endorsements are to be received and approved by the City before work commences. As an alternative to the City's forms, the Consultant's insurer may provide complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications. INDEPENDENT CONTRACTOR. a. Consultant is and shall at all times remain as to the City a wholly independent contractor. The personnel performing the services under this Agreement on behalf of Consultant shall at all times be under Consultant's exclusive direction and control. Neither City nor any of its officers, employees, agents, or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents except as set forth in this Agreement. Consultant shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of the City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner. b. No employee benefits shall be available to Consultant in connection with the performance of this Agreement. Except for the fees paid to Consultant as provided in the Agreement, City shall not pay salaries, wages, or other compensation to Consultant for performing services hereunder for City. City shall not be liable for compensation or indemnification to Consultant for injury or sickness adsing out of performing services hereunder. 5 r:\cip~rojects~wg9-18~agrmts\KJeinfelder Agrmt 12. LEGAL RESPONSIBILITIES. The Consultant shall keep itself informed of all local, State and Federal ordinances, laws and regulations which in any manner affect those employed by it or in any way affect the performance of its service pursuant to this Agreement. The Consultant shall at all times observe and comply with all such ordinances, laws and regulations. The City, and its officers and employees, shall not be liable at law or in equity occasioned by failure of the Consultant to comply with this section. 13. RELEASE OF INFORMATION. a. All information gained by Consultant in performance of this Agreement shall be considered confidential and shall not be released by Consultant without City's pdor written authorization. Consultant, its officers, employees, agents or subcontractors, shall not without wdtten authorization from the City Manager or unless requested by the City Attorney, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement or relating to any project or property located within the City. Response to a subpoena or court order shall not be considered "voluntary" provided Consultant gives City notice of such court order or subpoena. b. Consultant shall promptly notify City should Consultant, its officers, employees, agents or subcontractors be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, court order or subpoena from any party regarding this Agreement and the work performed there under or with respect to any project or property located within the City. City retains the right, but has no obligation, to represent Consultant and/or be present at any deposition, headng or similar proceeding. Consultant agrees to cooperate fully with City and to provide City with the opportunity to review any response to discovery requests provided by Consultant. However, City's right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response. 14. NOTICES. Any notices which either party may desire to give to the other party under this Agreement must be in writing and may be given either by (I) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice. Notice shall be effective upon delivery to the addresses specified below or on the third business day following deposit with the document delivery service or United States Mail as provided above. To City: City of Temecula Mailing Address: P.O. Box 9033 Temecula, California 92589-9033 43200 Business Park Drive Temecula, California 92590 Attention: City Manager To Consultant: Kleinfelder, Inc. 43218 Business Park Drive, Suite 201 Temecula, California 92590 Attention: Keith P. Askew, PE Geotechnical Group Manager r:\cip~rojects~w99-18',agrmts\Kleinfelder Agrmt '15. ASSIGNMENT. The Consultant shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without pdor wdtten consent of the City. Upon termination of this Agreement, Consultant's sole compensation shall be payment for actual services performed up to, and including, the date of termination or as may be otherwise agreed to in writing between the City Council and the Consultant. 16. LICENSES. At all times dudng the term of this Agreement, Consultant shall have in full force and effect, all licenses required of it by law for the performance of the services described in this Agreement. 17. GOVERNING LAW. The City and Consultant understand and agree that the laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Agreement and also govern the interpretation of this Agreement. Any litigation concerning this Agreement shall take place in the municipal, superior, or federal district court with geographic jurisdiction over the City of Temecula. In the event such litigation is filed by one party against the other to enforce its rights under this Agreement, the prevailing party, as determined by the Court's judgment, shall be entitled to reasonable attorney fees and litigation expenses for the relief granted. 18. PROHIBITED INTEREST. No officer, or employee of the City of Temecula shall have any financial interest, direct or indirect, in this Agreement, the proceeds thereof, the Contractor, or Contractor's sub-contractors for this project, during his/her tenure or for one year thereafter. The Contractor hereby warrants and represents to the City that no officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the Contractor or Contractor's sub-contractors on this project. Contractor further agrees to notify the City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. 19. ENTIRE AGREEMENT. This Agreement contains the entire understanding between the parties relating to the obligations of the parties described in this Agreement. All pdor or contemporaneous agreements, understandings, representations and statements, oral or wdtten, are merged into this Agreement and shall be of no further force or effect. Each party is entedng into this Agreement based solely upon the representations set forth herein and upon each party's own independent investigation of any and all facts such party deems material. 20. AUTHORITY TO EXECUTE THIS AGREEMENT. The person or persons executing this Agreement on behalf of Consultant warrants and represents that he or she has the authority to execute this Agreement on behalf of the Consultant and has the authority to bind Consultant to the performance of its obligations hereunder. 7 r:\cip~proj e cts~w99-18~a gr mts',,Klein feld e r Agrmt IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. ClTY OFTEMECULA Jeffrey E. Stone, Mayor Attest: Susan W. Jones, CMC, City Clerk Approved As to Form: Peter M. Thorson, City Attorney CONSULTANT Kleinfelder, Inc. 43218 Business Park Drive, Suite 201 Temecula, California 92590 (909) 506-1488 Michael P. Kesler, Regional Manager Bartlett Patton, Sr. Vice President (Signatures of two corporate officers required for Corporations) 8 r:\cip",p roi ects~ow99-18\a grmts',Klein feld er Agn~t EXHIBIT a TASKS TO BE PERFORMED And PAYMENT RATE AND SCHEDULE r:\cip~p rojects~pw99-18~agrmts\Kteinfelder Agrmt ~ KLEINFELDER March 31, 2003 Revised April 29, 2003 Proposal No. 05602PROP/TEM3M033 Mr. Steve Charette City of Temecula Public Works Department 43200 Business Park Drive Temecula, California 92590 Subject: Geotechnical Consultation and Materials Testing Services Rancho California Road Bridge Widening Over Murrleta Creek City of Temecula Project No. PW99-18 Temecula, California Dear Mr. Charette: Kleinfelder is pleased to submit this proposal to provide geotechnical consultation and materials testing services for the Rancho California Road Bridge Widening Over Murdeta Creek project. Our submittal has been prepared in response to the City of Temecula's Request for Proposal (RFP) No. 115, dated March 17, 2003. If selected, our services will be provided under our Annual Agreement for Professional Geotechnical/Materials Testing Services for 'Fiscal Year 2002-2003, effective July 23, 2002 through June 30, 2003. Our familiarity with the project, our established reputation as a leader in the field of geotechnical and materials testing, and our depth of experience and professional qualifications all combine to position Kleinfelder at the forefront of our competitors. We are confident that the Kleinfelder team can meet the goals and expectations set for the project, and provide the City of Temecula with the high standards of quality it has come to expect from our work. We appreciate the opportunity to submit this proposal and look forward to the prospect of working with you on this project. Should you have any questions regarding our firm and capabilities, please do not hesitate to contact the undersigned at your convenience. Sincerely, Geotechnical Group Manager Area Manager 05602PROP/TEM3M033 Copyright 2003 Kleinfelder, Inc. KLE[NFELDER 43218 Business Park Drive, Suite 201, Temecula, CA 92590 (909) 506-1488 (909) 506-1491 fax ~ KLEINFELDER TABLE OF CONTENTS SECTION 2.0 3*0 ' 4.0 5.0 6.0 7.0 PAGE PROJECT DESCRIPTION/SCOPE OF SERVICES ............................................................................ 1 1.1 Project Description ................................................................................................................... 1 1.2 Key Constraints ........................................................................................................................ 2 1.3 Scope of Services ..................................................................................................................... 2 PROPOSED APPROACH / DETAILED ITEMS OF WORK ............................................................. 4 2,1 Engineering Consultation Prior To Construction ..................................................................... 4 2.2 Engineering and Field Observation During Installation of Stone Columns ............................. 5 2.3 Engineering and Field Observation During Installation of CIDH Piles ................................... 5 2.4 Testing and Inspection Services for Materials ......................................................................... 6 2.5 Technical Management for the Project ..................................................................................... 8 2.6 Report Preparation .................................................................................................................... 8 2.7 Summary of Estimated Costs ................................................................................................... 9 FIRM OVERVIEW ............................................................................................................................. 10 3.1 Caltrans Expertise ................................................................................................................... 10 3.2 Public Works Experience ....................................................................................................... 10 3.3 Materials Testing Capabilities ................................................................................................ 11 3.3.1 Materials Engineering ................................................................................................ 11 3.3.2 Materials Construction Testing & Observation ......................................................... 12 3.3.3 Laboratory Testing ..................................................................................................... 12 3.4 Project Quality Assurance Program (Independent Assurance Sampling & Testing) ............. 13 RELATED PROJECT EXPERIENCE & CLIENT REFERENCES: GEOTECHNICAL & MATERIALS TESTING SERVICES ................................................................................................. 14 PROJECT MANAGER AND PERSONNEL ASSIGNED TO PROJECT ......................................... 17 RI~SUM~_,S .......................................................... i ................................................................................ 19 FEE SCHEDULE ................................................................................................................................ 26 05602PROP/TEM3M033 Copyright 2003 Kleinfelder, Inc. ~ KLEINFELDER RANCHO CALIFORNIA ROAD BRIDGE WIDENING OVER MURRIETA CREEK TEMECULA, CALIFORNIA 1.0 PROJECT DESCRIPTION/SCOPE OF SERVICES Presented herein is our understanding of the project, key issues and constraints likely to be encountered during project construction, and the scope of services that we anticipate will be required. Our understanding of the project is based on information provided in your Request for Proposal (RFP) No. 115, dated March 17, 2003; the project plans entitled Rancho California Road, Bridge Widening over Murrieta Creek, Project No. PW 99-18, prepared by Project Design Consultants, dated March 10, 2003; and the project specifications entitled City of Temecula, Plans, Specifications, and Contract Documents for Project No. PW99-18, Rancho California Road Bridge Widening Over Murrieta Creek, undated. Additionally, we have reviewed the project soils report entitled Revised Bridge Foundation Report, Proposed Rancho California Bridge Widening at Murrieta Creek, Temecula, California, prepared by Kleinfelder, Inc. dated March 29, 2002. 1.1 Project Description The project site is located along Rancho California Road at Murrieta Creek, between Jefferson Road and Diaz Road in Temecula, California. The existing Rancho California Bridge currently consists of two lanes in each east- and west-bound direction, and is approximately 360 feet in length and 72 feet wide. The bridge is a five span, cast-in-place concrete box girder structure and is supported by two abutments and four bents. The project will consist of widening the north and south sides of the existing structure. The widening will improve traffic operations and flow, enhance safety characteristics, and provide increased traffic capacity. Construction operations for the widening of the bridge, from a geotechnical engineering standpoint, will include the installation of 36-inch-diameter and 60-inch-diameter cast-in-drilled-hole (CIDH) concrete piles, and additional bridge abutments. There will be fourteen 36-inch-diameter piles with each extending to a depth of approximately 62-feet below the existing grade. Twelve 60-inch diameter piles will be constructed with each extending to a depth of approximately 89 feet. The bridge abutments will be founded on the 36-inch-diameter piles and retain compacted soil backfill for the approaches. Due to liquefiable soils located adjacent to the eastern bridge abutment (Abutment 6), mitigation will include the installation of nine 30-inch-diameter stone columns. Site grading is required that will include the placement of backfill soils behind each of the abutments. The additional bridge deck will consist of cast-in-place concrete box girder founded on the 60-inch diameter piles and abutments. The bents supporting the existing bridge deck will undergo seismic retrofitting during the bridge widening. 05602PROPFi'EM3M033 Page 1 of 26 Copyright 2003 Kleinfelder, Inc, k~ KLEINFELDER 1.2 Key Constraints Key constraints, from a geotechnical engineering standpoint, include the logistics of widening an existing bridge on both sides. Installing the piles and stone columns within the channel bottom and on each side of the bridge will result in considerable down time for mobilizing the rigs from one side to the other. This is particularly of concern for the figs and cranes required for the installation of the stone columns. The equipment is cumbersome due to size and will likely require more time to set-up than to actually install the columns. To mobilize from one side to the other, may require some disassembly of the crane. Groundwater is present, along with loose soils, within the channel bottom. The crane and support equipment required to install the stone columns, and the drill fig required to excavate the CIDH piles, have large loads and may have difficulties mobilizing. The construction of temporary (import fill) access roads may be required for support of equipment. Additionally, dewatering the site is not allowed due to environmental constraints. Therefore, construction of the CIDH piles will require utilizing a slurry mixture or steel casing during drilling to prevent caving. Due to such logistics, rapid response for our availability and daily monitoring of progress with the subcontractors is critical to prevent cost overruns. Kleinfelder is aware of such issues and can provide the required support due to the location of our office and laboratory, and staff employees that maintain residence within the city limits. 1.3 Scope of Services Based on the RFP and our experience with similar projects, we anticipate that the scope of services will include the following: Reviewing project plans and specifications with emphasis on geotechnical and laboratory materials testing services. · Attending pre-construction meetings with the project team. Responding to Request for Information (RFI) submittals from the contractors. Providing observation and field testing services along with engineering consultation 24-hours-a-day. Providing field engineering, observation, documentation, and testing services during the installation of stone columns. · Providing field engineering, observation, documentation, and testing services during the installation of cast-in-drilled-hole (CIDH) piles. · Providing testing and observation services during the placement of fill soils required for the construction of the proposed abutments and associated slopes. · Providing concrete inspection services during all phases associated with construction of the bridge, including abutments, CIDH piles, cast-in-place box girders for the bridge deck and approaches. Sampling concrete, grout, and shotcrete for compressive strength testing. 05602PROPfrEM3M033 Page 2 of 26 Copyright 2003 Kleinfelder, Inc. k~ KLEINFELDER Providing observation and testing during the placement of fill soils behind the bridge abutments, during utility trench backfilling operations, and during the preparation of street subgrade, curb/gutter subgrade, sidewalk subgrade, and base materials within the approaches. Sampling materials and providing laboratory tests to support field services and to satisfy Caltmns Quality Assurance Program requirements. Performing observations of the foundation excavations and of the drainage provisions for the bridge abutments. Sampling subgrade soils and providing "R" value testing within the approaches. Providing responsive consultation services during situations that will require corrective and/or remedial recommendations. Preparing field and final reports for all of the above services. 05602PROPtTEM3M033 Page 3 of 26 Copyright 2003 Kleinfelder, Inc. k~ KLEINFELDER 2.0 PROPOSED APPROACH / DETAILED ITEMS OF WORK Kleinfelder's approach to the project will consist of providing experienced, qualified engineers and technicians for engineering, observation, and testing as an extension of the City's staff. We anticipate that the project will be funded with state and/or federal funds. Therefore, we have based our project approach on the requirements of Chapter 16.14 of the Caltrans Local Assistance Procedures Manual and the Caltrans Quality Assurance Program (QAP) outlined therein. Our approach, list of items of work to be performed, and estimated man-hours is the result of being a part of many projects similar to this. We have extensive experience with the construction of CIDH piles, the installation of stone columns, and providing field and materials testing. Additionally, we performed the geotechnical investigation for the project and were directly involved with the preliminary phases and design. Therefore, we have an in-depth understanding of the geotechnical aspects for successfully completing the project. Provided below is our approach and anticipated items of work with regard to providing geotechnical engineering and materials testing services for the project. Providing man-hours at this time for the personnel assigned to each task is difficult to estimate. We have provided our approximation of time required, however} these costs may need to be re-evaluated once a construction schedule is available. 2.1 Engineering Consultation Prior To Construction Upon award of the contract we will meet with the primary contractor and the many different subcontractors involved with geotechnical engineering related phases. We anticipate that a different specialty subcontractor will be utilized for the installation of the CIDH piles, installation of the stone columns, grading the site and placing fill soils associated with the bridge abutments, and construction of the bridge roadway approaches. Our project manager and engineer will provide these services. At a minimum, we will discuss the following issues prior to construction: · Project schedule · Anticipated mob/demob dates for each of the specialty subcontractors · Initial and forecasted field engineer and technician staffing requirements · Unique construction issues such as extended or limited construction hours, night work, and contractor deadlines · Lines of communication, conununication frequency, reporting requirements, and other protocol · Documentation requirements per the project specifications and deviations from the project specifications We have estimated that approximately 12 hours of project manager time will be required for this task. 05602PROP/TEM3M033 Page 4 of 26 Copyright 2003 Kleinfelder, Inc. ~ KLEINFELDER 2.2 Engineering and Field Observation During Installation of Stone Columns We will provide a staff engineer on-site during the installation of the stone columns to document, at a minimum, the following information for each stone column: · Location and/or grid identification · Date and time installation begins and ends · Total depth of penetration and the relative increase in amperage observed with the vibration equipment versus depth · Quantity and weight of stone backfill installed · Diameter of stone column versus depth Additionally, we will document the rigs, equipment, and procedures used for installation, and any variances with reference to those provided in the project specifications. Where procedures or equipment are found to be out of compliance with the project specifications, the appropriate consultant or contractor will be asked to provide comment or acceptance. Materials testing during installation of the stone columns is anticipated to consist of testing the backfill for Durability Index, gradation, specific gravity, and unit weight. A formal report will be provided once installation is complete that will include the above information along with the laboratory test results. Additionally, a site plan depicting the location of each stone column will be provided. We have estimated that 20 hours of stafftime and 4 hours of project engineer time will be required in the field. We have allocated $1,000 for report preparation and $700 for laboratory testing. 2.3 Engineering and Field Observation During Installation of CIDH Piles We will provide a staff engineer on-site during the installation of the CIDH piles to document, at a minimum, the following information for each pile: · Location and/or grid identification · Date and time for the drilling of the excavation, placement ofrebar, and placement of concrete · Diameter of pile, total depth drilled, existing ground elevation, and tip elevation · Log of the soil conditions encountered · Installation and location of vertical inspection pipes for gamma-gamma testing Additionally, we will document the type and size of rig utilized for drilling the excavations, equipment, and procedures used for placement of the rebar and concrete, and any variances with reference to those provided in the project specifications. Where procedures or equipment are found to be out of compliance with the project specifications, the appropriate consultant or contractor will be asked to provide comment or acceptance. 05602PROP/TEM3M033 Page 5 of 26 Copyright 2003 Kleinfelder, Inc. ~ KLEINFELDER Materials testing during installation of the CIDH piles is anticipated to consist of fabricating concrete cylinders, performing compressive strength tests, and inspecting/testing the slurry or drilling mud during drilling operations. Acceptance, tests will be performed that will include gamma-gamma logging or cross-hole sonic logging. A formal report will be provided once installation of the CIDH piles is complete that will include the above information along with the laboratory test results, acceptance test results, and a site plan depicting the locations of the piles. A total of 26 piles will be installed, and we have assumed that, on average, 2 piles will be installed per day. Therefore, we have allocated 14 days, or 112 hours of staff engineer time and 8, hours of project engineer time for installation of the piles. For concrete testing, we have assumed that one set of concrete cylinders will be fabricated and tested for compressive strength for each pile installed. Therefore, we have allocated approximately 100 hours of technician time for fabricating the cylinders, approximately $2,300 for compression strength testing of the concrete, and $1,500 for report preparation. Full time observation will be provided during placement of concrete for the piles. Gamma-gamma testing and cross-hole sonic logging of the CIDH piles will be performed by our subconsultant EarthSpectives, located in Irvine, California. Costs for these services are estimated to be approximately $19,000. 2.4 Testing and Inspection Services for Materials We will assign a senior supervisory technician to the project with overall responsibility for coordinating sampling, inspecting, and testing materials. His responsibilities will include field observation and testing of soils, sampling, fabricating concrete cylinders for laboratory testing, and updating the project engineer of progress observed. We anticipate the scope of soils and materials testing will include the following: Providing testing and observation services during the placement of fill soils required for the construction of the proposed abutments and associated slopes. Providing concrete inspection services during all phases associated with construction of the bridge, including abutments, CIDH piles, cast-in-place box girders for the bridge deck and approaches. Full- time observation will be provided during placement of concrete for the piles. Services will be provided on an "on-call" basis during placement of concrete for the bridge deck, approaches, and abutments. Sampling concrete, grout, and shotcrete for compressive strength testing. Providing observation and testing during the placement of fill soils behind the bridge abutments, during utility trench backfilling operations? and during the preparation of street subgrade, curb/gutter subgrade, sidewalk subgrade, and base materials within the approaches. Sampling materials and providing laboratory tests to support field services and to satisfy Caltrans Quality Assurance Program requirements. · Sampling subgrade soils and providing "W' value testing within the approaches. 05602PROP/TEM3M033 Page 6 of 26 Copyright 2003 Kleinfelder, Inc. ~.~ KLEINFELDER Routine laboratory soil and concrete testing will be performed in our Temecula laboratory. The technician will be experienced and certified by Caltrans for the testing and sampling anticipated (Certificate of Proficiency for an Acceptance Tester, MR-0111). Additional qualified field technicians will assist the senior supervisory technician, as necessary. Daily field reports will be completed by each of our field personnel and given to the on-site City representative along with results of field tests performed. Our personnel are familiar with and can utilize Caltrans forms and filing system, if desired. The senior technician can assist the Resident Engineer with maintaining a material and testing "Summary Log" as required by the Caltrans QAP. Our personnel will observe the placement of embankment fill to assess that it is placed in lifts of appropriate thickness, suitable moisture and compaction. Nuclear density tests will be performed in accordance with Caltrans standard test methods. Nuclear gauges will be used which have been calibrated on Caltrans Standard density blocks. Portland cement concrete will be sampled in accordance with the project requirements. 6" x 12" compressive strength cylinders will be cast. 6" x 6" beams will be cast during concrete paving. Our laboratory testing, including asphalt concrete and aggregate quality testing will be performed under the direction of Mr. Ruben Roque. Our laboratories routinely perform all of the testing required for this project and meets all laboratory requirements outlined in Chapter 16.14 of the Local Assistance Procedures Manual. Our laboratory personnel are experienced with and certified by Caltrans to perform the required testing. A mobile laboratory can be set up at the project site, if desired. The following laboratory tests are anticipated based on our experience, Chapter 8 of the Caltrans Construction Manual and Exhibit 16-R of the Local Assistance Procedures Manual. Soil (includes bedding material) Sieve Analysis (CAL 202) · Maximum Density (CAL 216) Sand Equivalent (CAL 217) R-Value (CAL 301) Aggregate Base Sieve Analysis (CAL 202) · Percent Crashed Particles (CAL 205) Maximum Density (CAL 216) Durability Index (CAL 229) · R-Value (CAL 301) Portland Cement Concrete Sieve Analysis (CAL 202) Sand Equivalem (CAL 217) Moisture Content (CAL 226) Cleanness Value (CAL 227) Flexural Strength (CAL 523) Compression (CAL 521 ) 05602PROPFFEM3M033 Page 7 of 26 Copyright 2003 Kleinf¢Ider, Inc. ~ KLEINFELDI~R For purposes of this proposal we have estimated that approximately 2 sets of 4 concrete cylinders will be fabricated and tested for compressive strength for every 300 yd~ of concrete placed for the bridge abutments, approaches, and deck. According to project specifications, approximately 1,500 yd~ will be placed and, therefore, approximately 10 sets of cylinders will be fabricated and tested. We have allocated approximately 40 hours of technician time for fabricating the cylinders, and $1,000 for compression strength testing. The technician time to fabricate the cylinders will be provided on an "on-call" basis. The field technician time for testing bridge abutment backfill, approach subgrade, curb/gutter and sidewalk subgrade, base, and utility trench backfill is difficult to approximate without a construction schedule. For purposes of this proposal, we have estimated approximately 20 working days, or 160 hours of field technician time will be required. Laboratory testing for R-values, maximum dry density and optimum moisture content, and incidental testing is anticipated to cost $1,500. 2.5 Technical Management for the Project Technical management for this project will be the responsibility of our project manager, Mr. Keith Askew, who is located in our Temecula office. He is a California registered Professional Engineer and all testing services will be performed under his responsible charge. This task will include routine periodic review of test procedures and test results. Construction procedures and the progress of the contractor with respect to achieving the project requirements will be reviewed on an as-needed basis. On-call consulting will be provided during construction as issues arise that deal with testing and performance'of construction materials. Portland cement concrete and asphalt concrete mix designs may also be reviewed for conformance to project requirements aa part of this task. This task also includes attendance at construction meetings and the preparation of miscellaneous correspondence required during the course of the project. According to the RFP, a total of 220 working days has been estimated for the project to be completed, or approximately 44 weeks. For purposes of this proposal, we have assumed that an average of 2 hours per week of Project Manager time will be required. 2.6 Report Preparation Formal typewritten reports will contain the following information along with that previously described in the above tasks: · Description of the construction work observed and tested · Summary of the field sampling and testing procedures used. · Tabulated summary of field test data. · Tabulated summary of laboratory test data. · Our opinion regarding the contractor's compliance with the project plans and specifications from a geotechnical and materials standpoint. 05602PROP/'rEM3M033 Page 8 of 26 Copyright 2003 Kleinfelder, Inc. ~ K£EINFEI. D~R A single, comprehensive report can be prepared at the completion of the project or intermittent reports can be prepared as the work progresses. All reports will be prepared under the direction of the project manager or other registered engineer and senior member of our finn. We have allocated $2,000 for preparation ora report presenting field and laboratory test data from testing and inspection of materials. Reports for the observation and testing for stone columns and CIDH piles have previously been discussed. 2.7 Summary of Estimated Costs Provided in the table below is a cost summary of the estimated costs: Task Cost Engineering Consultation Prior to Construction 12 hrs. Project Manager ~ $140/hr. Observation During Installation of Stone Columns 20 hrs. Staff Engineer ~ $104/hr. 4 hrs. Project Engineer ~ $140/hr. Laboratory Testing Report Preparation Observation During Installation of CIDH Piles 112 hrs. StaffEngineer ~ $104/hr. 8 hrs. Project Engineer $140/hr. 100 hrs. Field Tech for Cone. Cylinders ~ $67/hr. Laboratory Testing of Conc. Cylinders Report Prep. EarthSpectives Gamma-gamma testing Testing and Inspection of Materials ~;0 hrs. Field Tech for Cone. Cylinders ~ $67/hr. Laboratory Testing of Cone. Cylindem 160 hrs. Field Tech for Field Testing ~ $67/hr. Laboratory Testing of Subgrade Soils and Miscellaneous Testing Technical Management 88 hrs. Project Engineer ~ $140/hr. Report Preparation TOTAL ESTIMATED COST *Cost includes 10% subcontractor mark-up $1,680 $2,080 560 700 1,000 $11,648 1,120 6,700 2,300 1,500 20,820* $2,680 1,000 10,720 1,500 $12,320 $2,000 $8o 28 05602PROPFI'EM3M033 Copyright 2003 Kleinf¢lder, Inc. Page 9 of 26 ~.~ KLEINFELDER 3.0 FIRM OVERVIEW Kleinfelder is an employee-owned, multi-disciplinary engineering consulting firm specializing in geotechnical, environmental, and materials testing. We are a leader in these fields, as evidenced by our ranking in the Top 100 in Engineering News Records' survey of the "Top Engineering and Environmental Firms" in the nation. Since 1961, Kleinfelder has been providing geotechnical, construction, materials testing and environmental services to both the public and private sectors. We currently employ over 1,400 employees and have 60 offices located throughout the western United States and Mexico. Services for this project would be performed from our Temecula office, with support provided from our Redlands and San Diego offices/laboratories. Our Southern California Region includes offices and laboratories in Riverside, San Bernardino, Los Angeles, Orange and San Diego Counties, with more than 160 qualified engineers, geologists, managers, field and administrative staff. We are therefore able to efficiently and effectively service the majority of areas where active development, redevelopment and capital improvements are occurring. Our depth of experience and personnel allows us to respond to our Clients' needs in a timely manner. 3.1 Caltrans Expertise Kleinfelder is currently or has recently completed design and construction services directly for Caltrans in Districts 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12 and 59. Through these projects, as well as many hundreds for cities and counties, our personnel are well versed in Caltrans procedures, documentation, plans and specifications, including the latest metric standards and guidelines. Local projects requiring Caltrans oversight have been performed for the Riverside County Transportation Department, San Bernardino County Transportation attd Flood Control Department, San Bernardino ,lssoclated Governments (S,INB,IG), Transportation Corridor ,lgency (TC,I), Orange County Transportation Authority (OCT,I), and Orange County Public Facilities and Resources Department, and numerous local agencies and municipalities. Field inspection, sampling and testing, laboratory testing, engineering analysis, and report preparation follow Caltrans procedures, as required. The resulting knowledge of these procedures along with our experience with construction materials, construction practices, and local experience promotes a high quality of service while optimizing the efficiency of project-related tasks. 3.2 Public Works Experience Kleinfelder has a long, successful track record of providing services on public works-related projects. Over the past 3 ¼ decades, nearly half of all projects completed by Kleinfelder have been in and/or for the public sector. ,lpproximately 65% of our current projects in Southern California are public works related, either being performed directly for public agencies or through design/civil engineering firms. As a result, Kleinfelder is well versed in the requirements for timeliness and efficiency when working on public sector projects. After more than 40 years in the business, we have worked with many federal, state and local agencies and are knowledgeable with applicable codes, regulations and ordinances associated with public works design and construction. 05602PROP/TEM3M033 Page 10 of 26 Copyxight 2003 Kleinfelder, Inc. k~ KLEINFE[DER 3.3 Materials Testing Capabilities Kleinfelder has more than 40 years of statewide experience and over 14 years of local experience providing materials sampling, testing and construction inspection services on transportation projects. The projects have varied from small arterial roadways to major limited-access highways. Our experience includes: Highway rehabilitation/reconstruction Highway widening/new construction Bridge construction Asphalt and concrete paving Landscaping ramp construction Retaining structures Soundwalls Embankments and slopes Drainage systems Asphalt and PCC overlays Seal Coats 3.3.1 Materials Engineering Kleinfelder's material engineers work hand in hand with design professionals providing technical knowledge and expertise in the development of design specifications and analysis of construction materials. Our engineers reduce the uncertainty involved in dealing with construction materials and damaged structural elements through the application of standardized destructive and non-destructive testing programs suitable for your specific needs. The Kleinfelder staff has expertise with: · Rehabilitation assessments and structural investigations of steel, concrete, masonry and wood structures; Performing building surveys to establish as-built construction details; · Evaluation of materials through non-destructive and destructive test methods; · Performance of full-scale load testing programs and assessments of building distress; · Failure investigations and analysis; · Evaluation of design adequacy, construction techniques, and integrity of building materials; · Providing damage assessments and accident reconstruction; · Expert witness testimony; · Materials research (material. compatibility, mechanical testing, instrumentation, corrosion, deterioration and fabrication survey); and · Product testing (ICBO research reports, accelerated weathering and product use testing and instrumentation). 05602PROP/TEM3M033 Page 11 of 26 Copyright 2003 Kleinfelder, Inc. k~ KLEINFELDER 3.3.2 Materials Construction Testing & Observation Kleinfelder's objective is to reduce the uncertainty in dealing with construction materials. We have an in- house testing and qualification program to assure that qualified personnel are assigned to each project. Registered engineers supervise field and laboratory technical activities. Our technicians are encouraged to obtain advanced certification from local and nationally recognized programs. We have technicians trained through the National Institute for the Certification of Engineering Technicians (NICET), International Conference of Building Officials (ICBO) and the American Welding Society (AWS). Our technicians are cross-trained to provide field observation and testing services on a wide variety of projects. Site Grading * Placement of Reinforcing Steel · Foundation Excavations · Backfill Placement · Subgrade Preparation · Pile Driving · Drilled Pier Construction · Rock Anchor Placement Asphalt and Concrete Paving · Reinforcement Placement · Batch Plant Inspection · Concrete Placement · Steel Construction · Masonry Construction · High Strength and Expansion Bolting · Drainage Systems · Soil Improvement · Load Tests · Field Instrumentation (inclinometers, piezometers) 3.3.3 Laboratory Testing Kleinfelder laboratories are fully equipped for testing most soil, rock and construction materials. Kleinfelder has an in-house quality assurance program to maintain a high level of accuracy and reproducibility in testing services performed by the firm. All gauges, proving rings, scales, and other equipment used for testing are calibrated on a regular basis by certified independent agencies. Experienced technicians perform laboratory tests and registered professional engineers review the results. Kleinfelder's own quality assurance program is supplemented with regular inspection by governmental agencies. Periodic inspection of·ur testing equipment and testing techniques is conducted by the City of Los Angeles, Caltrans, AASHTO, and the National Bureau of Standards through the Commercial Testing Laboratory Accreditation Program. · Soil Classification & Indices · Dispersion '] · Soil & Aggregate · Metals · Hydraulic Conductivity · Permeability/ · Concrete · Roofing · Consolidation · Swell / · Masonry · Epoxy · Triaxialshear · Direct shearI · Asphalt · Timber 05602PROPFFEM3M033 Page 12 of 26 Copyhght 2003 Kleinfelder, Inc. ~ KLEINFELDER 3.4 Project Quality Assurance Program (Independent Assurance Sampling & Testing) An additional advantage to selecting Kleinfelder is that the City may not need to make additional arrangements to provide Independent Assurance Sampling and Testing as required by the Caltrans Local Assistance Procedures Manual and Quality Assurance Manual. Because of the testing we are currently performing on other projects under Caltrans oversight our laboratory is certified to perform virtually all of the testing that will be required for the subject project. We can provide documentation that all equipment to be used on the project meets Caltrans Quality Assurance Program requirements. Also, nearly all of our technicians possess a current "Certificate of Proficiency for an Acceptance Tester", for most every type of test that will be required. Our certified technicians are routinely recertified in accordance with the minimum frequencies outlined in Table 1 of the Caltrans Quality Assurance Program Manual. Certificates for a number of our technicians are included in Appendix A. Lastly, because several of our technicians will be working on other Caltrans-related projects during the same time period as the subject project, split-sample testing using the equipment to be assigned to this project will very likely be current and no project-specific split-sample testing will be necessary. We will be able to provide documentation that can be incorporated into the project file to show that each sampler and/or tester has been performing the job correctly, and that the testing equipment is in proper working order. 05602PROP/'rEM3M033 Page 13 of 26 Copyright 2003 Kleinfelder, Inc. ~ KLEINFELDER 4.0 RELATED PROJECT EXPERIENCE & CLIENT REFERENCES: GEOTECHNICAL & MATERIALS TESTING SERVICES State Route 210 Segments 1-4 Material Testing San Bemardino County, California ~an Bernardino Associated Governments (SANBAG) ¢44 Arrowhead.4venue. San Bernardino, CA ~lr. Gary Moon (909) 889-8611 State Route 210 Early Construction Projects San Bemardino County, California ~an Bernantino Associate Governments (S.4NB,4 G) g72 N. .4rrowhead /1 venue, San Bernardlno, Cd Mr. Gary Moon (909) 889.8611 Caltrans District 8 On-Call Materials Testing Contract Various Locations throughout Cagrans District 8 ~tate of California Department of Transportation, District 8 Consultant Contract Management ~64 West Fourth Street, MS 1231, San Bernardino. CA Mr. Robert So (909) 383-4513 91 Freeway / La Sierra Avenue Interchange Reconstruction Project Riverside, California City of Riverside c./o Boyle Engineering 1131 West Sixth Street, Suite 285 Ontario, C/l, 91762 ~teve Frieson (909) 933-5225 Performed materials testing services for an 8.4-mile portion of State Route 210 Segments 1-4, from the City of Upland to east o f Milliken Avenue in the City of Rancho Cucamonga. The project involved one high occupancy vehicle (HOV) lane and three mixed flow lanes in each direction. Project ~lements include six interchanges; retaining walls; sound walls; drainage structures; 1,500,000 cubic meters of embankment; 150,000 cubic meters of PCC paving; and $0,000 tonnes of asphalt concrete. Total Cost: $3,000,000 Material testing services in support of the State Route 210 "early :ons~uction" projects in San Bemardino County. Total Cost: $2,000,000 To date, Kleinfelder h~s performed these services on four separate Caltrans construction projects: · Inteestate 15 Pavement Rehabilitation, Cima Road to Stateline, 23 km · Interstate 15 Rehabilitation and Widening, Mojave Drive to State Route 58, 29 km · Interstate 40 Pavement Rehabilitation, Cmcero Road to Kclbaker Road, 22 km · Halinran Summit Bridge and Approach Replacement on Interstate 15 Services provided have included batch plant inspection for asphalt concrete and Portland cement concrete, Class 2 aggregate base, imported borrow and ~'mbankment soil, and structural backfill. Laboratory testing has been 9crformcd in Caltmas laboratories. Total Cost: $2,500,000 Prepared a P~limina~y GeotechnicaFS~'uctares Design Report for the project as well as a Hazardous Waste Initial Site Assessment. Our geotechnical services were performed in accordance with Caltrans Geotechnical Design Report (GDR) guidelines. We evaluated geologic and geotecboieal characteristics of the project area, reviewed information pertaining to the existing infi'astxuctore, and provided preliminary recommendations for project design and construction. Our report included findings and recommendations regarding seismicity, foundation alternatives, and earthwork. Kleinfeldar also performed a Hazardous Waste Initial Site Assessment to evaluate the presence or likely presence of hazardous ~ubstances or potxolctun products at the site. Total Cost: $26,000 05602PROP/TEM3M033 Page 14 of 26 Copyright 2003 Ktcinfelder, Inc. k~ KLEINFELDER Interstate 10 / Etlwanda Avenue / Valley Boulevard Improvements San Bemardino. California ~an Bernardino County ~o Catellvs Development ~000 fi/esterly Place ~qewport Beach, Cd 92560 Dan Matula (949) 251-2350 Van Buren Boulevard/91 Freeway Bridge Improvements Riverside, California CiO, of Riverside c/o McDaniel Engineering 5030 Camino de la Siesta. San Diego, Cd Mr. Jachdbcarius (619) 692-1920 Winchester Road (Highway 79), Pemecula, California County of Riverside c/o Albert A. fi/ebb 28481 Rancho California Rd., Temecula, CA Mr. Kelly Donovan (909) 275-6880 Arlington Avenue Grade Separation at the Santa Fe Railroad Crossing, Riverside, California City of Riverside cio MK Centennial 17300 RedHilldve., lrvine, Cd 92614 Stir. Melad Hanna (949) 756-6006 Numerous Los Angeles County Highway/Freeway Sites Los Angeles County, Califomia Caltrans District 7 cio MK Centennial Engineering 17300 Red Hill dve., Irvine, C,~ 92614 lilts. Jane P. fi/arren (949) 756-6006 Mast Boulevard Extension & Bridge Santee, California City ofSantee a/o P&D Technologies ~01 fi/e~t A Street. San Diego, Cd Idr. Roger Hoeing (619) 232-4466 the Interstate 10 / Etiwanda Avenue / Valley Boulevard improvement project included the following: · Construction of new on- and off-ramps to 1-10 & Etiwanda Avenue · Realignment of the on- and off-ramp system at 1-10 & Etiwanda · New on-ramp separation where the new westbound Valley Boulevard on-ramp will cross the new westbound Etiwanda Avenue off-ramp · Improve vertical clearance of the existing eastbound Valley Boulevard off-ramps where it crosses under 1-10 · Construction of 9 retaining walls · Extension of an existing reinforced box culvert · Realignment of Valley Boulevard to a common intersection at Etiwanda Avenue with Ontario Mills Parkway · Realignment of approximately 2,000 feet of existing Union Pacific Railroad tracks · Conslruction of a new iwo span bridge on Valley Boulevard crossing both the Union Pacific Railroad spur and the San Sovaine Flood Control Chamqe] total Cost: $145. ~eotechnical investigation for design of proposed bridge widening. including freeway ramp improvements total Cost: $32,000 Soil inspection and materials and laboratory testing, and geotechnical consulting services du~ing construction for the widening of 5 miles of Highway 79. Total Cost: $282,000 Geotachnical services during prelimina~ and final design of railroad bridge and retaining walls during construction oftbo stxeet underpass. Total Cost: $24,000 Soils and materials testing and inspection for construction on several freeways, traffic control procedures, and seismic retrofit of 18 bridge total Cost: $525,000 Geotechnical investigation for 4-lane, 7,500 foot extension of Mast Boulevard, and an 850-foot long, six-span bridge. rotal Cost: $60,000 05602PROP/TEM3M033 Page 15 of 26 Copyright 2003 Klcinfelder, Inc. ~ KLEINFELDER State Route 71 (South) Relocation, Riverside/Orange/San Bema~dino County Lines, California Coun~ of Orange Public Facilities & Resources 1152 E. Fruit Street, Santa Ana, CA 92701 blr. Winston Mettke (714) 567-7843 Interstate 10/Valley Boulevard Improvements San Bemardino County, Call fomia gajappan & Meyer Consulting Engineers 60 S. Market St. 0510, San Jose. CA 95113 ~lr. Keith Meyer (408} 280-2772 State Route 71 (North) Upgrade Chino, California ~an Bernardino Assoc. Governments (SANBAG} 472 N. Arrowhead Ave.. San Bernardino, CA ~ffr. Joe Shaw (909) 889-8611 Materials testing and g~t~i~l field se~ices for ~ad widening ~d ro~l Cost: $530,000 Oeotechnical & geologic services. Recommendations for design and :ons~xuctlon of road alignment, railroad overpass, ramps, concrete box :ulve~ grade separation. Total Cost: $8,500 Geoteehnical and materials testing services. Involved widening road to ~recway status, bridges, drainage structures, concrete, soil, aggregates, asphalt concrete. Total Cost: $740,000 05602PROPFFEM3M033 Page 16 of 26 Copyright 2003 Kleinfelder, Inc. ~ KLEINFELDER 5.0 PROJECT MANAGER AND PERSONNEL ASSIGNED TO PROJECT The project manager and engineer will be Mr. Keith Askew, PE. Mr. Askew has approximately 10 years experience in geotechnical engineering, preparing preliminary soils, foundation and percolation reports, and special reports dealing with specific geotechnical challenges. Projects have included bridges, roads, highways, railroads, landslide mitigation, buried structures, water facilities and buried conduits. He develops conclusions and recommendations for site grading, static and seismic foundation design, slope stability, retaining walls, soil mitigation methods, and street structural section design. Assisting Mr. Askew will be Mr. Alleu Evans, PE, GE - Area Manager, responsible for senior oversight; Mr. Jeff Heranic - Supervisory Field Technician; Mr. Jude Butterwegge - Field Technician; Mr. Chuck Nieto - Field Technician; and Mr. Ruben Roque - Laboratory Manager (see Organization Chart, below). City of Temecula Keith Askew, PE Allen Evans, PE, GE Jeff Heranic 05602PROP/TEM3M033 Page 17 of 26 Copyright 2003 Kleinfelder, Inc. ~:~ KLEINFELDER KLEINFELDER TECHNICIAN EXPERIENCE MATRIX The following is a matrix of other local Kleinfelder technicians who could support the City of Temecula on this project. RickBdil6 X X X X X X X X X X X X X X X X XX X XX X X X X Ter~Bridemfine 1~ X X X X X X X X X X X X X X X X X X X X ,X X X Edward C~ 3 X X X X X X Paul Cole 26 X X X X IX X X X X X X X X X X X Man:Crispin 12 X X X X X XIX X X X X X X X X X VartanDeirdeirian 8 X X X X X X X XiX X X X X X X X X X X Ba~Lavsen 8 X X X X X X X X X X X X X X X JemnyLarsen 6 X X X X X X X X X X X X X X X X X X DickMalnar 31 X X X X X X X X X X X X X GeorgeNavafijo 14 X X X X X X X X X X X X X X X X X Chuckl~leto23 X X X X X X X X X X X X X X X X X X X X X X P. uI~nP, oque23 X X X X X X X X X X X X X X X X X:X X X X X X X 05602PROPtTEM3M033 Page 18 of 26 Copyright 2003 Kleinfelder, Inc. 6.0 R~SUM~S ~ KLEINFELDER 05602PROP/TEM3M033 Page 19 of 26 Copyright 2003 Kleinfelder, Inc. k~ KLEINFELDER ALLEN EVANS Area Manager Education MS Civil Engineering, 1985 BS Agricultural Engineering, 1980 Registrations Geotechnical Engineer, 1988 Civil Engineer, 1984 Mr. Evans has proven his ability to successfully manage simultaneous, large-scale materials testing contracts for Caltrans, and local agencies for over 12 years. As a Senior Associate with the firm, he can ensure that Kleinfelder's local and national resources are available for successful project completion. Allen will provide technical oversight; training; assign and monitor personnel; administer personal leave; maintain contract budget and schedules; and document contxol. State Route 30, Segments 1-4, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Project manager of materials testing for construction of 8.4 miles of new freeway. The project includes numerous soundwalls, retaining walls, and drainage facilities. State Route 30 Early Construction Projects, SANBAG, San Bernardino County, California. Project Manager for the Early Constmctinn projects on State Route 30 consisting of 13 overcrossings, five major drainage facilities, and soundwalls adjacent to and within Segments 1-5, scheduled for completion in 2001. The entire project involves Caltrans review. State Route 71 (North), SANBAG, Chino, California. Project Manager on materials testing contract for a portion of 8.5-mile freeway constmction. Project entailed extensive widening and realignment to accommodate the design of the new freeway to replace the existing 2-lane road extending from Los Angeles County to San Bemardino County, including three bridge structures, provisions for 3 lanes each way, and two HOV lanes. Materials testing was performed on concrete, soil, aggregates and asphalt concrete. Pioneered use of soil nail design and construction for stabilization ora cut slope. 05602PROP/TEM3M033 Page 20 of 26 Copyright 2003 Kleinfelder, Inc. State Route 71 (South), County of Orange Public Facilities & Resource Department, Riverside County, California. Project Manager for material sampling and testing, construction inspection and contract administration services, for the reconstruction of a 4.4 km segment of SR-71 from the Riverside/San Bemardino County line to the SR-91 interchange (the bridge crossing the Santa Ana River). The project entailed rehabilitation and widening the road to a 2-lane divided expressway, and to raise the profile of SR-71 by 28 feet for 1.5 miles to accommodate the raising of Pmdo Dam. Project components include culverts, excavation/embankment, wildlife crossings, reinforced concrete boxes, and PCC pavement. Interstate 10 Widening, Yuca~oa and Redlands, California. Project Manager for construction inspection, materials sampling, and testing services for the freeway widening project along 6 miles of the 1-10. Together these projects consisted of 18 ramps being either widened or reconstructed, and construction of seven bridge abutments. The scope of services included freeway lane and shoulder widen'mg, ramp construction, and structure work. Sampling and testing of soils, aggregates, concrete and asphalt pavements were performed. Highway 138/Interstate 15 Roadway attd Ratnp Improvements, Caltrans District 8 c/o Fluor Daniel, San Bernardino, California. Project Manager for construction observation and materials testing services for roadway and interchange ramp improvements along 1.2 miles of Highway 138. Project involved freeway lane and shoulder widening, ramp construction, structure work, and straightening of the roadway alignment, which included embankment fill. Winchester Road (Highway 79), Assessment District 161, County of Riverside Department of Transportation c./o Albert A. Webb Associates, Temecuia, California. Project Manager for soil inspection and material testing services for the widening of 5 miles of Highway 79, and provided geotechnical engineering services in support of the final design and construction. Caltrans District 8 provided final oversight. ~ KLEINFELDER KEITH P. ASKEW, ILC.E. Geotechnical Group Manager Education MS Civil BS and Environmental Engineering, Concentration in Geotechnical Engineering, California Polytechnic State University, San Luis Obispo, 1994 Civil Engineering, California Polytechnic State University, San Luis Obispo, 1992 Registrations Civil Engineer, No. 56418, California, 1997 Professional Affiliations American Society of Civil Engineers Geoinstitute oft_he American Society of Civil Engineers Building Industry Association of Southern California Chi-Epsilon, Honorary Civil Engineering Society Mr. Askew has approximately 10 years of progressively responsible charge with geotechnical engineering and management. His experience includes a wide variety of public and private facility projects throughout southem California including commercial/industrial developments, residential developments, bridges, schools and universities, airports, pipelines, and roadways. Responsibilities vary from performing field investigations, to engineering analysis and report preparation. He oversees laboratory materials testing of soils, concrete, and asphalt. Field activities and oversight include materials sampling, construction monitoring of tie-back retaining walls, deep foundations including piles and cast-in-place caissons, and the installation of wick-drains and stone columns. He has extensive experience with the installation of wick drains and stone columns as mitigation for both clayey and liquefiable soils within roadways. Many of his projects included the design of buttresses required for stabilizing earthen slopes for large-scale mass grading of roadways. Vista Sorrento Parkway Bridge, San Diego, California Project and field engineer for the installation of stone columns designed to mitigate liquefaction potential of subsurface soils beneath proposed bridge abutment. The bridge is located adjacent to Interstate 5 in San Diego, California. Approximately 854 stone columns were installed for 05602PROP/TEM3M033 Copy~ght 2003 Kleinfelder, Inc. a total of approximately 41,588 linear feet, and approximately 8,282 cubic yards of 3/n-inch crashed rock. The design spacing and diameter of for each column was 10 feet and 30 inches, respectively. The project was under stringent time constraints and double shifts were performed. Mr. Askew coordinated and provided field documentation and observation during the installation of the columns. Olympic Parkway, Chula Vista, California. Provided oversight during the installation of wick drains within the alignment of Olympic Parkway in Chula Vista, California. Liquefaction, settlement, and a shallow groundwater table required mitigation for the construction of the roadway. Mr. Askew coordinated the field observation and documentation during the installation of the wick drains. Subsequently managed the testing and observation services for the placement of required fill soils placed upon the wick drains and within the roadway alignment. Oceank Atmospheric Research Facility, University of California San Diego. Performed field investigation, and provided design criteria for tie- back retaining wall, foundation recommendations for the research facility, seismic analysis, and construction monitoring during installation of tie- back wall and associated mass grading. The project involved stabilizing a large landslide adjacent to existing roadways in La Jolla, California, using a tie- back retaining wall. The roadways remained operational during all phases of constrection. Torrey Hills, San Diego, California. Project engineer and manager for the project. Provided foundation design criteria to structural engineers and architects for both residential and commercial buildings. The development is a master-planned community and consists of approximately 800 homes, an elementary school, and associated infrastructure and roadways. Mass grading included deep alluvial removals and placement of compacted fill soils in excess of 100 feet thick. Improvements, including walls and roadways, were often designed and constructed in deep compacted fill soils and dense formational materials. Provided design parameters associated with the differential settlement anticipated within the soils. Page 21 of 26 ~k~ KLEINFELDER CHUCK NIETO SR-210 Field Project Manager Education Colorado School of Welding, Gary Larsen School Inspector, Welding, MIG, TIG, ARC, Diploma, 1 year Registrations Caltrans MR-0111 Certification 1994/ICBO, Reinforced Concrete #81291 1994/ICBO, Structural Masonry #84571 1994/Proto Type II Wall Systems Post Tension Masonry 1990/Health & Safety 40-Hour Training and Updates 1991/ACI Level 1 1991/ACI Asphalt & Concrete Plant Inspection & Procedures Certificate 1991/Public Works Construction Inspection & Procedures Certificate Mr. Nieto has more than 25 years of materials testing experience on a wide range of large public works projects, including several highway construction projects. State Route 30, Segments 1-4, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Project field manager for materials testing during construction of new 8.5-mile freeway. Supervised more than 10 technicians and coordinated testing operations between subconsultants, field laboratory, and main laboratory. State Route 30 Early Construction Projects, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Lead Construction Technician providing materials testing services in support of the Early Construction projects for State Route 30, which includes 13 overerossings, five major drainage facilities and soundwalls throughout Segments 1-5. The entire project involves Caltrans review. State Route 71 (South), County of Orange Public Facilities & Resource Department, Riverside County, California. Lead Construction Technician providing materials testing and inspection services during the reconstruction of a 4.4 lan segment of Route 71 from the Riverside/SanBemardino County line to the Route 91 interchange, involving culverts, reinforced concrete boxes, wildlife crossings, excavation/embankment, and PCC pavement. Interstate 70, Denver, Colorado. Construction Technician in charge of inspection of concrete paving, asphalt concrete paving, bridge and drainage structures, fill placement, abutment construction, and associated testing of materials used on approximately 10 miles of roadway and bridge construction. Interstate 25, Denver, Colorado. Construction Technician responsible for inspection during improvements of approximately three miles of Interstate 25. Inspections and testing of subgrade preparation, aggregate base, Portland Cement concrete paving, asphalt concrete paving and drainage structures. 05602PROP/TEM3M033 Page 22 of 26 Copyright 2003 Kleinfelder, Inc. ~k~:~ KLEINFELDER RUBEN ROQUE Laboratory Manager Education Courses in Concrete Strength and Materials, Mathematics and Physics, San Bemardino Valley College Laboratory Practices Seminar, Soil and Foundation Engineering Association Registration Caltrans Certification TL-0111 Nuclear Gauge Certificate of Completion, Campbell-Pacific Nuclear Corporation American Concrete Institute, Grade 1, Technician OSHA 40-Hour and 8-Hour HAZWOPER Training Mr. Roque has over 25 years of experience. As Laboratory Manager, he supervises and schedules all soil and construction material testing performed in the laboratory. Mr. Roque ensures that proper laboratory conditions of temperature, moisture, etc., are ma'mtained as required to ensure accuracy of various pieces of testing equipment, and that proper inspections and adjustments are performed at required intervals. Also responsible for performing all tests above those that are completed by the technicians. Mr. Roque has been influential in obtaining approval of the laboratory as a testing laboratory for the Department of the Navy and the U.S. Department of Commerce, Cement and Concrete Reference Laboratory, Bureau of Standards (ASTM E329). State Route 30, Segments 1-4, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Laboratory manager of materials testing for construction of 8.4 miles of new freeway. The project includes numerous soundwalls, retaining walls, and drainage facilities. Winchester Road (Highway 79), County of Riverside Department of Transportation, Temecula, California. Laboratory Supervisor for testing of all construction materials for 3-mile realignment project. Testing included asphalt concrete, aggregate base and soil. State Route 30 Early Construction Projects, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Laboratory supervisor for the early construction projects for Route 30, a proposed 23-mile freeway extending from the Los Angeles/San Bemardino County line, to Interstate 215 in the City of San Bemardino. A total of 27 early construction projects are anticipated, including 17 overcrossings, 5 major drainage facilities and soundwalls. The entire project involves Caltrans review. State Route 71 (South), County of Orange Public Facilities & Resource Department, Riverside/Orange Counties, California. Laboratory supervisor for materials sampling and testing, that involved the reconstruction of a 4.4 km segment of Route 71 from the Riverside/San Bemardino County line to the Route 91 interchange. Project included culverts, reinforced concrete boxes, excavation/embankment, wildlife crossings, and PCC pavement. State Route 71 (North), SANBAG, San Bernardino County, California. Laboratory Supervisor for on-call materials testing contract during construction of 8.5-mile freeway, which included three bridge structures. Materials tested included Portland Cement concrete and asphalt concrete. State Route 91~cKinley Avenue Overpass, Corona, California. Supervised all laboratory testing during construction of overpass improvement, including embankment, Portland Cement concrete and asphalt concrete. MWD Feeder Line Structure and Railroad Relocation Project, Kaiser Resources c/o CM Engineering .4ssociates, Fontana, California. Provided concrete laboratory testing during construction of a protection structure over a 14- foot MWD feeder line, in conjunction with the relocation of approximately 6,000 feet of railroad at the California Speedway. 05602PROPfrEM3M033 Page 23 of 26 Copyright 2003 Kleinfclder, Inc. ~ KLEINFELDER JEFFREY HERANIC Field Technician Education Registrations Caltrans Proficiency Methods: 125, 201,202, 206, 207, 208, 216, 217, 226, 227, 231,308, 370, 375, 382, 518, 533,539, 540 ICBO - Special Inspection - Reinforced Concrete, 1995 ACI - Concrete Field Testing Technician, Grade I, 1991 NICET - Level III, Concrete, Asphalt and Construction Materials Testing, 1994 Level II Transportation Highway Materials Testing, 1994 Level II Geotechnical Engineering Technology Construction, 1994 Construction Materials/Laboratory/Exploration Tmxler - Nuclear Gauge Safety Certificate, 1990 Mr. Heranic has over 15 years experience as an engineering technician. His experience has included concrete inspection, rough and fine grading operations, asphalt inspection and supervision of laboratory for NDOT projects. He has performed inspection services for airports, highways and roadways, residential and structure projects, levees and pipelines. State Route 71 Improvement Project, SANBAG, Chino, California. Performed concrete inspection and sampling, subgrade preparation testing, sampling and testing of soils and aggregate for this on-call materials testing project, during construction of a portion of this 8.5-mile freeway. State Route 95, Indian Springs, Nevada. Provided testing, sampling and inspection for preparation of asphalt and asphalt paving for 10 miles of roadway. Duties included crasher control sampling and testing, aggregates and liner treatment, mobile hot plant inspeetinn, sampling, end product testing, and density testing. State Route 160, Paharump, Nevada. Provided quality control inspections of crashed aggregates for lane widening and asphalt production. Rancho ,4veuue, State Bushtess Route 95, Las Vegas, Nevada. Laboratory supervisor for NDOT testing of paving materials for 8-mile pavement overlay. Imperial Highway and Kraemer, Brea, California. Performed testing and sampling of soils, aggregates, asphalt and concrete for shopping center street improvements. 05602PROP/TEM3M033 Page 24 of 26 Copyright 2003 Kl¢infelder, Inc. ~ KLEINFELDER JUDE BUTTERWEGGE Lead Technician Education Registration Nuclear Gage Certification Caltrans TL-0111 Mr. Butterwegge possesses extensive working knowledge of the principles and practices of materials testing as applied to the construction of state highways. He has established positive working relationships with a number of local Caltrans and construction management personnel. As Lead Technician, Jude will strictly adhere to Caltrans Standards to ensure compliance of structural material tests and inspections. State Route 30 Early Construction Projects, San Bernardino Associated Governments (SANBAG), San Bernardino County, California. Laboratory testing services in support of the Early Construction projects for State Route 30, which includes 13 overcrossings, five major drainage facilities and soundwalls throughout Segments 1-5. The entire project involves Caltrans review. State Route 30 Segments 1-4 Materials Testing Services, San Bernardino County, California. Performed batch plant inspection and laboratory testing services on Segments 1- 4 0f State Route 30 in San Bemardino County, California. The project involves an 8.4 mile portion of the alignment, from the City of Upland to east of Milliken Avenue in the City of Rancho Cucamonga. The project involves one HOV and three mixed flow lanes in each direction; six interchanges; soil nail walls; 1,500,000 cubic meters of embankment; 150,000 cubic meters of PCC paving; and 50,000 tonnes of asphalt concrete. 05602PROPfrEM3M033 Page 25 of 26. Copyright 2003 Kleinfeldcr, Inc. ~ KLEINFELDER 7.0 FEE SCHEDULE PROFESSIONAL STAFF RATES* Professional I .................................................................................................................. $ 86 / hour Professional II ................................................................................................................. $ 95 / hour Staff Professional I ......................................................................................................... $ 104 / hour Staff Professional II / Project Manager I ........................................................................ $ 113 / hour Project Professional / Project Manager II ....................................................................... $ 122 / hour Senior Professional / Senior Project Manager ................................................................ $ 140 / hour Principal Professional ..................................................................................................... $ 149 / hour Program/Client Manager I .............................................................................................. $ 149 / hour Program/Client Manager II ............................................................................................. $ 158 / hour Senior Principal Professional ......................................................................................... $ 158 / hour Senior Program/Client Manager ...................................................................................... $ 167 / hour ADMINISTRATIVE/TECHNICAL STAFF RATES Administrative I .............................................................................................................. $ 60 / hour Project Administrator I ................................................................................................... $ 67 / hour Project Administrator II .................................................................................................. $ 77 / hour Technician ...................................................................................................................... $ 67 / hour Senior Technician ........................................................................................................... $ 82 / hour Supervisory Technician .................................................................................................. $ 90 / hour Drat~sperson .................................................................................................................... $ 70 / hour CADD Operator ...................... : ........................................................................................ $ 82 / hour Designer .......................................................................................................................... $ 90 / hour Public works projects or projects receiving public funds may be subject to California Prevailing Wage laws. The above rates do apply to projects subject to prevailing wages in California for field technical staff. Applies to all professional rates including but not limited to civil, mechanical, chemical, electrical, geotechnical and environmental engineers; industrial hygienists; geologists; hydrogeologists; hydrologists; and computer specialists. 05602PROP/TEM3M033 Page 26 of 26 Copyright 2003 Kleinfelder, Inc. ITEM 26 APPROVAL CITY ATTORNEY ~ DIRECTOR OF FINANC~_~ CITY MANAGER ~ CITY OF TEMECULA AGENDA REPORT TO: jCity Manager/City Council FROM: ,'~/~lWilliam/Jl G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Professional Services Agreement with T Y Lin International for Construction Support for the Rancho California Road Bridge Widening Over Murrieta Creek, Project No. PW99-18 PREPARED BY: Greg Butler, Principal Engineer- Capital Projects Steve Charette, Assistant Engineer- Capital Projects RECOMMENDATION: That the City Council: 1. Approve a Professional Service Agreement with T Y Lin International in an amount not to exceed $40, 385.00 for Construction Support for the Rancho California Road Bridge Widening Over Murrieta Creek, Project No. PW99-18, and authorize the Mayor to execute the contract. 2. Authorize the City Manager to amendments to the agreement not to exceed the contingency amount of $4,038.50 which is equal to 10% of the agreement amount. BACKGROUND: On April 22, 2003, the City Council awarded a construction contract to MCM Construction, Inc. for the Rancho California Road Bridge Widening Project. The project will include the widening of the Rancho California Road Bridge over Murrieta Creek an additional four lanes including one additional lane each-way along with dual left and free right turn lanes for eastbound traffic. Improvements will include scour protection and seismic retrofitting. The City requires additional technical assistance during the construction of the bridge and related improvements. TY Lin International was the prime consultant for the design of the project and is the Engineer of record. This agreement will authorize the consultant to provide technical assistance such as review of contractor submittals, and provide "as-built" revisions to the project plans and specifications. This agreement is based on hourly rates of only the time required to complete the work. FISCAL IMPACT: The Rancho Califomia Road Bridge Widening Over Murrieta Creek Project is funded through Redevelopment Agency funds and Development Impact Fees (Street Improvements). The total agreement amount is $44,423.50 which includes the agreement amount of $40,385.00 plus a 10% contingency amount of $4,036.50. Adequate funds are available for consultant services in Account No. 210-165-710-5804. ATTACHMENTS: Agreement with T Y Lin International CiTY OF TEMECULA AGREEMENT FOR CONSTRUCTION SUPPORT SERVICES RANCHO CALIFORNIA ROAD BRIDGE WIDENING OVER MURRIETA CREEK PROJECT NO. PW99-18 THIS AGREEMENT, is made and effective as of May 13, 2003, between the City of Temecula, a municipal corporation ("City") and TY Lin International, ("Consultant"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. TERM. This Agreement shall commence on May 13, 2003, and shall remain and continue in effect until tasks described herein are completed, but in no event later than December 31, 2004, unless sooner terminated pursuant to the provisions of this Agreement. 2. SERVICES. Consultant shall perform the services and tasks described and set forth in Exhibit A, attached hereto and incorporated herein as though set forth in full. Consultant shall complete the tasks according to the schedule of performance which is also set forth in Exhibit A. 3. PERFORMANCE. Consultant shall at all times faithfully, competently and to the best of his or her ability, experience, and talent, perform all tasks described herein. Consultant shall employ, at a minimum, generally accepted standards and practices utilized by persons engaged in providing similar services as are required of Consultant hereunder in meeting its obligations under this Agreement. 4. PREVAILING WAGES. Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the City Council has obtained the general prevailing rate of per diem wages and the general rate for holiday and overtime work in this locality for each craft, classification, or type of workman needed to execute this Contractor from the Director of the Department of Industrial Relations. These rates are on file with the City Clerk. Copies may be obtained at cost at the City Clerk's office of Temecula. Consultant shall provide a copy of prevailing wage rates to any staff or sub-contractor hired, and shall pay the adopted prevailing wage rates as a minimum. Consultant shall comply with the provisions of Sections 1773.8, 1775, 1776, 1777.5, 1777.6, and 1813 of the Labor Code. Pursuant to the provisions of 1775 of the Labor Code, Consultant shall forfeit to the City, as a penalty, the sum of $25.00 for each calendar day, or portion thereof, for each laborer, worker, or mechanic employed, paid less than the stipulated prevailing rates for any work done under this contract, by him or by any subcontractor under him, in violation of the provisions of the Contract. 5. PAYMENT. a. The City agrees to pay Consultant monthly, in accordance with the payment rates and terms and the schedule of payment as set forth in Exhibit A, Payment Rates and Schedule, attached hereto and incorporated herein by this reference as though set forth in full, based upon actual time spent on the above tasks. Any terms in Exhibit A other than the payment rates and schedule of payment are null and void. This amount shall not exceed Forty Thousand Three Hundred Eighty-Five Dollars and No Cents ($40,385.00) for the total term of the Agreement unless additional payment is approved as provided in this Agreement. r:\cip~projects~pw99-11 SW~agrmts\TYLiN Agrmt b. Consultant shall not be compensated for any services rendered in connection with its performance of this Agreement which are in addition to those set forth herein, unless such additional services are authorized in advance and in writing by the City Manager. Consultant shall be compensated for any additional services in the amounts and in the manner as agreed to by City Manager and Consultant at the time City's wdtten authorization is given to Consultant for the performance of said services. c. Consultant will submit invoices monthly for actual services performed. Invoices shall be submitted between the first and fifteenth business day of each month, for services previded in the previous month. Payment shall be made within thirty (30) days of receipt of each invoice as to all nondisputed fees. If the City disputes any of consultant's fees it shall give written notice to Consultant within 30 days of receipt of a invoice of any disputed fees set forth on the invoice. 6. SUSPENSION OR TERMINATION OF AGREEMENT WITHOUT CAUSE. a. The City may at any time, for any reason, with or without cause, suspend or terminate this Agreement, or any portion hereof, by serving upon the consultant at least ten (10) days prior written notice. Upon receipt of said notice, the Consultant shall immediately cease all work under this Agreement, unless the notice provides otherwise. If the City suspends or terminates a portion of this Agreement such suspension or termination shall not make void or invalidate the remainder of this Agreement. b. In the event this Agreement is terminated pursuant to this Section, the City shall pay to Consultant the actual value of the work performed up to the time of termination, provided that the work performed is of value to the City. Upon termination of the Agreement pursuant to this Section, the Consultant will submit an invoice to the City pursuant to Section 4. 7. DEFAULT OF CONSULTANT. a. The Consultant's failure to comply with the provisions of this Agreement shall constitute a default. In the event that Consultant is in default for cause under the terms of this Agreement, City shall have no obligation or duty to continue compensating Consultant for any work performed after the date of default and can terminate this Agreement immediately by wdtten notice to the Consultant. If such failure by the Consultant to make pregress in the performance of work hereunder arises out of causes beyond the Consultant's contrel, and without fault or negligence of the Consultant, it shall not be considered a default. b. If the City Manager or his delegate determines that the Consultant is in default in the performance of any of the terms or conditions of this Agreement, it shall serve the Consultant with written notice of the default. The Consultant shall have (10) days after service upon it of said notice in which to cure the default by rendering a satisfactory performance. In the event that the Consultant fails to cure its default within such pedod of time, the City shall have the dght, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice to any other remedy to which it may be entitled at law, in equity or under this Agreement. 8. OWNERSHIP OF DOCUMENTS. a. Consultant shall maintain complete and accurate records with respect to sales, costs, expenses, receipts and other such information required by City that relate to the performance of services under this Agreement. Consultant shall maintain adequate records of services provided in sufficient detail to permit an evaluation of services. All such records shall be 2 r:\dp~rojects~pw99-11 SW~agrrnts\TYLIN Agrmt maintained in accordance with generally accepted accounting principles and shall be clearly identi- fied and readily accessible. Consultant shall provide free access to the representatives of City or its designees at reasonable times to such books and records, shall give City the right to examine and audit said books and records, shall permit City to make transcripts there from as necessary, and shall allow inspection of all work, data, documents, proceedings and activities related to this Agreement. Such records, together with supporting documents, shall be maintained for a period of three (3) years after receipt of final payment. b. Upon completion of, or in the event of termination or suspension of this Agreement, all original documents, designs, drawings, maps, models, computer files containing data generated for the work, surveys, notes, and other documents prepared in the course of providing the services to be performed pursuant to this Agreement shall become the sole property of the City and may be used, reused or otherwise disposed of by the City without the permission of the Consultant. With respect to computer files containing data generated for the work, Consultant shall make available to the City, upon reasonable written request by the City, the necessary computer software and hardware for purposes of accessing, compiling, transferring and printing computer files. c. With respect to the design of public improvements, the Consultant shall not be liable for any injuries or property damage resulting from the reuse of the design at a location other than that specified in Exhibit A without the wdtten consent of the Consultant. 9. INDEMNIFICATION. The Consultant agrees to defend, indemnify, protect and hold harmless the City, its officers, officials, employees and volunteers from and against any and all claims, demands, losses, defense costs or expenses, including attorney fees and expert witness fees, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property adsing out of Consultant's negligent or wrongful acts or omissions arising out of or in any way related to the performance or non-performance of this Agreement, excepting only liability adsing out of the negligence of the City. 10. INSURANCE REQUIREMENTS. Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by the Consultant, its agents, representatives, or employees. a. Minimum Scope of Insurance. Coverage shall be at least as broad as: (1) Insurance Services Office Commemial General Liability form No. CG 00 01 11 85 or 88. (2) Insurance Services Office Business Auto Coverage form CA O0 01 06 92 covering Automobile Liability, code 1 (any auto). If the Consultant owns no automobiles, a non-owned auto endorsement to the General Liability policy described above is acceptable. (3) Worker's Compensation insurance as required by the State of California and Employer's Liability Insurance. If the Consultant has no employees while performing under this Agreement, worker's compensation insurance is not required, but Consultant shall execute a declaration that it has no employees. (4) Professional Liability Insurance shall be written on a policy form providing professional liability for the Consultant's profession. 3 r:\cip',proj e cts~pw99-11 SW~agrmts\TYLIN Agrmt b. Minimum Limits of Insurance. Consultant shall maintain limits no less than: (1) General Liability: One Million Dollars $1,000,000 peroccurrence for bodily injury, personal injury and property damage. If Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. (2) Automobile Liability: One Million Dollars ($1,000,000) per accident for bodily injury and property damage. (3) Worker's Compensation as required by the State of California; Employer's Liability: One million dollars ($1,000,000) per accident for bodily injury or disease. (4) Professional Liability coverage: Two Million Dollars ($2,000,000) per claim and in aggregate. c. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City Manager. At the option of the City Manager, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees and volunteers; or the Consultant shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. d. Other Insurance Provisions. The general liability and automobile liability policies are to contain, or be endorsed to contain, the following provisions: (1) The City, its officers, officials, employees and volunteers are to be covered as insureds as respects: liability adsing out of activities performed by or on behalf of the Consultant; products and completed operations of the Consultant; premises owned, occupied or used by the Consultant; or automobiles owned, leased, hired or borrowed by the Consultant. The coverage shall contain no special limitations on the scope of protection afforded to the City, its officers, officials, employees or volunteers. (2) For any claims related to this project, the Consultant's insurance coverage shall be primary insurance as respects the City, its officers, officials, employees and volunteers. Any insurance or self-insured maintained by the City, its officers, officials, employees or volunteers shall be excess of the Consultant's insurance and shall not contribute with it. (3) Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers. (4) The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. 4 r:\dpyrojects~w99-11 S~N~agrmts\TYLtN Agrmt (5) Each insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the City. e. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best's rating of no less than A:VII, unless otherwise acceptable to the City. Self insurance shall not be considered to comply with these insurance requirements. f. Verification of Covera,qe. Consultant shall furnish the City with original endorsements effecting coverage required by this clause. The endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf. The endorsements are to be on forms provided by the City. All endorsements are to be received and approved by the City before work commences. As an alternative to the City's forms, the Consultant's insurer may provide complete, certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications. 11. INDEPENDENT CONTRACTOR. a. Consultant is and shall at all times remain as to the City a wholly independent contractor. The personnel performing the services under this Agreement on behalf of Consultant shall at all times be under Consultant's exclusive direction and control. Neither City nor any of its officers, employees, agents, or volunteers shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents except as set forth in this Agreement. Consultant shall not at any time or in any manner represent that it or any of its officers, employees or agents are in any manner officers, employees or agents of the City. Consultant shall not incur or have the power to incur any debt, obligation or liability whatever against City, or bind City in any manner. b. No employee benefits shall be available to Consultant in connection with the performance of this Agreement. Except for the fees paid to Consultant as provided in the Agreement, City shall not pay salaries, wages, or other compensation to Consultant for performing services hereunder for City. City shall not be liable for compensation or indemnification to Consultant for injury or sickness adsing out of performing services hereunder. 12. LEGAL RESPONSIBILITIES. The Consultant shall keep itself informed of all local, State and Federal ordinances, laws and regulations which in any manner affect those employed by it or in any way affect the performance of its service pursuant to this Agreement. The Consultant shall at all times observe and comply with all such ordinances, laws and regulations. The City, and its officers and employees, shall not be liable at law or in equity occasioned by failure of the Consultant to comply with this section. '13. RELEASE OF INFORMATION. a. All information gained by Consultant in performance of this Agreement shall be considered confidential and shall not be released by Consultant without City's prior written authorization. Consultant, its officers, employees, agents or subcontractors, shall not without wdtten authorization from the City Manager or unless requested by the City Attorney, voluntarily provide declarations, letters of support, testimony at depositions, response to interrogatories or other information concerning the work performed under this Agreement or relating to any project or property located within the City. Response to a subpoena or court order shall not be considered "voluntary" provided Consultant gives City notice of such court order or subpoena. 5 r:\d p~p roi e cts',pw99-11SW~agrmts\TYLIN Agrmt b. Consultant shall promptly notify City should Consultant, its officers, employees, agents or subcontractors be served with any summons, complaint, subpoena, notice of deposition, request for documents, interrogatories, request for admissions or other discovery request, coud order or subpoena from any party regarding this Agreement and the work performed there under or with respect to any project or property located within the City. City retains the dght, but has no obligation, to represent Consultant and/or be present at any deposition, headng or similar proceeding. Consultant agrees to cooperate fullywith Cityand to provide City with the opportunityto review any response to discovery requests provided by Consultant. However, City's right to review any such response does not imply or mean the right by City to control, direct, or rewrite said response. 14. NOTICES. Any notices which either party may desire to give to the other party under this Agreement must be in writing and may be given either by (I) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice. Notice shall be effective upon delivery to the addresses specified below or on the third business day following deposit with the document delivery service or United States Mail as provided above. To City: City of Temecula Mailing Address: P.O. Box 9033 Temecula, California 92589-9033 43200 Business Park Drive Temecula, California 92590 Attention: City Manager To Consultant: TY Lin International 5030 Camino De La Siesta, Suite 204 San Diego, California 92108 Attention: P, oya Golchoobian, PE Senior Project Manager 15. ASSIGNMENT. The Consultant shall not assign the performance of this Agreement, nor any part thereof, nor any monies due hereunder, without prior written consent of the City. Upon termination of this Agreement, Consultant's sole compensation shall be payment for actual services performed up to, and including, the date of termination or as may be otherwise agreed to in writing between the City Council and the Consultant. 16. LICENSES. At all times during the term of this Agreement, Consultant shall have in full force and effect, all licenses required of it by law for the performance of the services described in this Agreement. 17. GOVERNING LAW. The City and Consultant understand and agree that the laws of the State of California shall govern the rights, obligations, duties and liabilities of the parties to this Agreement and also govern the interpretation of this Agreement. Any litigation concerning this Agreement shall take place in the municipal, superior, or federal distdct court with geographic jurisdiction over the City of Temecula. In the event such litigation is filed by one party against the other to enforce its rights under this Agreement, the prevailing party, as determined by the Court's judgment, shall be entitled to reasonable attorney fees and litigation expenses for the relief granted. r:\cip~rojects~w99-11S~agrmts\TYLiN Agrmt 18. PROHIBITED INTEREST. No officer, or employee of the City of Temecula shall have any financial interest, direct or indirect, in this Agreement, the proceeds thereof, the Contractor, or Contractor's sub-contractors for this project, during his/her tenure or for one year thereafter. The Contractor hereby warrants and represents to the City that no officer or employee of the City of Temecula has any interest, whether contractual, non-contractual, financial or otherwise, in this transaction, or in the business of the Contractor or Contractor's sub-contractors on this project. Contractor further agrees to notify the City in the event any such interest is discovered whether or not such interest is prohibited by law or this Agreement. 19. ENTIRE AGREEMENT. This Agreement contains the entire understanding between the parties relating to the obligations of the parties described in this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or wdtten, are merged into this Agreement and shall be of no further force or effect. Each pady is entedng into this Agreement based solely upon the representations set forth herein and upon each party's own independent investigation of any and all facts such party deems material. 20. AUTHORITY TO EXECUTE THIS AGREEMENT. The person or persons executing this Agreement on behalf of Consultant warrants and represents that he or she has the authority to execute this Agreement on behalf of the Consultant and has the authority to bind Consultant to the performance of its obligations hereunder. 7 r :\cip~projects~w99-11 SW~agrrnts\3'YLIN Agrmt IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written. CITY OFTEMECULA Jeffrey E. Stone, Mayor Attest: Susan W. Jones, CMC, City Clerk Approved As to Form: Peter M. Thorson, City Attomey CONSULTANT TY Lin International 5030 Camino De La Siesta, Suite 204 San Diego, California 92108 (619) 692-1920 John Haussnann,. President Mark Ashley, Sr. Vice President (Signatures of two corporate officers required for Corporations) 8 r:\ci p~p roi ects~pw99-11 SW~agrmts\TYLIN Agrmt EXHIBIT a TASKS TO BE PERFORMED And PAYMENT RATE AND SCHEDULE r:\cip~p roje cts~wg~- 11 SW~agrmts\TYLtN Agrmt 'FY, UN INTERNATIONAL April 9, 2003 RECE1VED 17 2003 CiD' OF TF-MECULA ENGtNEERING OEPARIMENq' City of Temecula 43174 Business Park Drive Temecula, CA 92590 Attention: Mr. Steve Charette, Assistant Engineer Subject: Proposal for Construction Support ~ Rancho California Road Bridge Widening Project Dear Mr. Charette, Per your request, we have prepared this proposal to provide construction support for the Rancho California Bridge Widening Project. We understand that the City of Temecula will staffthe project with a Resident Engineer and a Bridge Inspector experienced with bridge widening construction. The Bridge Inspector will be responsible for bridge construction inspections, contract administration, monitoring of bridge construction operations for contract compliance, as well as coordinating materials testing. TYLI's role during construction will consist primarily of providing technical assistance to the Resident Engineer and Bridge Inspector. TYL1 services, when requested, will include the following tasks: 1. Assist the Resident Engineer or Bridge Inspector in the interpretation of the contract documents. 2. Respond to contractor's request for information, (RF1). 3. Produce the bridge deck contours "4-scale" drawing, based on the field survey of existing edge of deck. 4. Review contractor submittals including: · Temporary falsework plans and camber strips · Prestressing shop drawings · Column Casing shop drawings · Concrete mix designs and aggregate gradings · CIDH Pile placement procedure and mix design 5. Prepare as-built plans based on the Resident Engineer's marked-up set of bluelines. 6. Attend the pre-construction meeting, plus one additional project meeting. 5030 Camino De La Siesta, Suite 204, San Diego, California 92108 · Facsimile (619) 692-0634 Telephone (6t9) 692-1920 City of Teraecula Attn: Mr. Steve Charette, Assistant Engineer Construction Support ~ Rancho CA Road Bridge P/idening March 20, 2003 7. Conduct up to five site visits to observe work in progress or to inspect specific field conditions requiring designer's review and input. Please refer to the attached scope and estimated fee for the services that will be provided by Project Design Consultants. We propose to provide these services on a time and materials basis in accordance with our schedule of fees in effect at the time the work is performed. Our schedule of fees for calendar year 2003 is attached. As indicated on the attached "Estimate of Fees", total chargers for our efforts are estimated not to exceed $40,385. Thank you for the opportunity to extend our commitment to this project. We look forward to working with you and completing this project successfully. Very truly youm, TYLIn International. Enclosure: Estimate of Fees PDC's scope and fee proposal Page 2 of 2 C:ltFINNTIProfileslrgolchoobian. OOO~Desktop~PM~Rancho corat supp. DOC File: 1657.00 March 19, 2003 Page 1 of 2 EXHIBIT 'A' - SCOPE OF WORK CONSTRUCTION SUPPORT SERVICES RANCHO CALIFORNIA ROAD BRIDGE WIDENING (PROJECT NO. PW 99-18) This following scope of work is for construction support services requested by the City of Temecula during the construction phase of the Rancho California Road Bridge Widening project. The general scope of work includes providing assistance to the city during bidding, pre- construction, construction, and post construction period. These will include; attending a pre-bid, and a pre-construction meetings, reviewing shop drawings for scour protection, reviewing and responding to contractor's request for information (RFIs), reviewing and approving submittals, attending scheduled construction meetings, attending the field walk through at closeout, and preparing the As-built plans. I - PRE-CONSTRUCTION 1. PDC will attend a pre-construction meeting and will provide responses to questions related to plans and specifications from Contractor. Budget allocation assumes approximately 2 hours per meeting per one person. Additional meetings will be attended, as directed by the City Project Manager, on a time-and-materials basis. (1 person attending) TIME-AND-MATERIALS BUDGET $ 270.00 (Not-to-Exceed Without Prior Written Authorization) II - CONSTRUCTION PDC will attend all scheduled construction meetings related to scour protection. Budget allocation assumes 10 hours for meeting. Additional meetings will be attended, as directed by the City Project Manager, on a time-and-materials basis. PDC will review all related scour protection shop drawings, and will provide responses as necessary. Budget allocation assumes 16 hours for this task. Additional required time will be charged on a time-and-material basis with prior written authorization from City. PDC will review and respond to the Contractor's RFIs concerning scour protection and/or the roadway portion of the project. Budget allocation assumes 10 hours for this task. Additional required time will be charged on a time-and -material basis File: 1657.00 March 19, 2003 Page 2 of 2 with prior written authorization from City. 4. PDC will review and respond to the Contractor's submittals related to scour protection and/or the roadway portion of the project. Budget allocation assumes 20 hours for this task. Additional required time will be charged on a time-and -material basis with prior written authorization from City 5. PDC will attend the final closeout and walk through meeting. Budget allocation assumes 3 hours for this task. TIME-AND-MATERIALS BUDGET $7,485.00 (Not-to-Exeeed Without Prior Written Authorization) III - POST CONSTRUCTION 1. PDC will review all as-built notes provided by the City, and will prepare an as-built plan per City of Temecula requirements. Budget allocation assumes 30 hours for this task TIME-AND-MATERIALS BUDGET $2,910.00 (Not-to-Exceed Without Prior Written Authorization) IV - REIMBURSABLE GENERAL: Reimbursable charges will include travel and mileage, delivery services, and other direct project charges incurred on behalf of Client will be billed to Client at cost plus 10%. TIME-AND-MATERIALS BUDGET $ 300.00 (Not-to-Exceed Without Prior Written Authorization) CLARIFICATIONS The projected hours described in the time-and-materials section of this agreement are based on a normal and reasonable review process. Should significant issues emerge during construction, which would require extra attention, and/or in case of prolonged construction period the budget described in this agreement will require adjustment for additional time, or up to date fees. Additional hours beyond those referenced will be considered as extras to the agreement and, with Client approval, will be charged on a time-and-materials basis. TOTAL FIXED FEE $ 270 TOTAL TIME-AND-MATERIALS BUDGET $ 10,695 TOTAL CONTRACT $ 10,965 File: 1657.00 March 19, 2003 Page 1 of 2 EXItIBIT 'A' - SCOPE OF WORK CONSTRUCTION SUPPORT SERVICES RANCHO CALIFORNIA ROAD BRIDGE WIDENING (PROJECT NO. PW 99-18) This following scope of work is for construction support services requested by the City of Temecula during the construction phase of the Rancho California Road Bridge Widening project. The general scope of work includes providing assistance to the city during bidding, pre- construction, construction, and post construction period. These will include; attending a pre-bid, and a pre-construction meetings, reviewing shop drawings for scour protection, reviewing and responding to contractor's request for information (RFIs), reviewing and approving submittals, attending scheduled construction meetings, attending the field walk through at closeout, and preparing the As-built plans. I - PRE-CONSTRUCTION 1. PDC will attend a pre-construction meeting and will provide responses to questions related to plans and specifications from Contractor. Budget allocation assumes approximately 2 hours per meeting per one person. Additional meetings will be attended, as directed by the City Project Manager, on a time-and-materials basis. (1 person attending) TIME-AND-MATERIALS BUDGET $ 270.00 (Not-to-Exceed Without Prior Written Authorization) II - CONSTRUCTION PDC will attend all scheduled construction meetings related to scour protection. Budget allocation assumes 10 hours for meeting. Additional meetings will be attended, as directed by the City Project Manager, on a time-and-materials basis. PDC will review all related scour protection shop drawings, and will provide responses as necessary. Budget allocation assumes 16 hours for this task. Additional required time will be charged on a time-and-material basis with prior written authorization from City. PDC will review and respond to the Contractor's RFIs concerning scour protection and/or the roadway portion of the project. Budget allocation assumes 10 hours for this task. Additional required time will be charged on a time-and -material basis File: 1657.00 March 19, 2003 Page 2 of 2 with prior written authorization from City. o PDC will review and respond to the Contractor's submittals related to scour protection and/or the roadway portion of the project. Budget allocation assumes 20 hours for this task. Additional required time will be charged on a time-and -material basis with prior written authorization from City 5. PDC will attend the final closeout and walk through meeting. Budget allocation assumes 3 hours for this task. TIME-AND-MATERIALS BUDGET $7,485.00 (Not-to-Exceed Without Prior Written Authorization) III - POST CONSTRUCTION 1. PDC will review all as-built notes provided by the City, and will prepare an as-built plan per City of Temecula requirements. Budget allocation assumes 30 hours for this task TIME-AND-MATERIALS BUDGET $2,910.00 (Not-to-Exceed Without Prior Written Authorization) IV - REIMBURSABLE GENERAL: Reimbursable charges will include travel and mileage, delivery services, and other direct project charges incurred on behalf of Client will be billed to Client at cost plus 10%. TIME-AND-MATERIALS BUDGET $ 300.00 (Not-to-Exceed Without Prior Written Authorization) CLARIFICATIONS The projected hours described in the time-and-materials section of this agreement are based on a normal and reasonable review process. Should significant issues emerge during construction, which would require extra attention, and/or in case of prolonged construction period the budget described in this agreement will require adjustment for additional time, or up to date fees. Additional hours beyond those referenced will be considered as extras to the agreemem and, with Client approval, will be charged on a time-and-materials basis. TOTAL FIXED FEE $ 270 TOTAL TIME-AND-MATERIALS BUDGET $ 10,695 TOTAL CONTRACT $ 10,965 ITEM 27 APPROVAL CITY ATTORNEY DIRECTOR OF FiNANCE~ CITY MANAGER CITY OF TEMECULA AGENDA REPORT TO: City Manager/City Council FROM: William G. Hughes, Director of Public Works/City Engineer DATE: May 13, 2003 SUBJECT: Solicitation of Construction Bids for Pechanga Parkway Phase IIA, Storm [~ Drain Improvements, Project No. PW99-11 SD \1/,_//I PREPARED BY:~mer Attar, Principal Engineer _.~ Steven W. Beswick, Associate Engineer RECOMMENDATION: That the City Council approve the project plans and specifications and authorize the Department of Public Works to solicit bids for the construction of the Pechanga Parkway Phase IIA, Storm Drain Improvements, Project No. PW99-11SD. BACKGROUND: The Public Works Department has completed the design and is in the final stages of obtaining the environmental clearances necessary for the Pechanga Parkway Phase IIA, Storm Drain Improvement Project. This project is part of the overall Pechanga Parkway Street Improvement Project, which is included in the City's Capital Improvement Program. This portion of the project will provide a drainage facility from Loma Linda Road to Temecula Creek consisting of a triple-cell box culvert and concrete channel. The triple-cell box culvert will be constructed within the northerly side of Pechanga Parkway. The concrete channel begins at Jedediah Smith Road right of way and continues northerly within the Jedediah Smith Road right of way until it outlets into Temecula Creek. The overall Pechanga Parkway Phase II Improvement project is partially funded with Federal funds (Public Lands and Highways). The inclusion of Federal funds will require that the environmental document be done under the National Environmental Policy Act (N EPA) provisions. Since this is a lengthy process and in order for the City to meet its obligation to the Wolf Creek Development by constructing the storm drain facility ahead of the development, construction will be divided into two phases, Phase IIA and Phase liB. Phase IIA consists of constructing the triple-cell box culvert/concrete channel from Loma Linda Road to Temecula Creek. Phase liB consists of constructing the pavement, curb gutters, and miscellaneous storm drain facilities along Pechanga Parkway. The City will not use Federal funds for the construction of the storm drain facility, Phase IIA. Therefore, the environmental approvals will fall under the California Environmental Quality Act (CEQA) guidelines, which is a much shorter process than the NEPA guidelines. 1 R:~AGENDA REPORTS~003~051303~W99-11BiD,d~c The construction of Phase IIA, the triple-cell box culvert/concrete channel from Loma Linda Road to Temecula Creek, will start as soon as the environmental clearances under CEQA are completed and RCFC & WCD approval is obtained. We expect to obtain these clearances in Mid-Summer 2003. Construction of the Phase liB, pavement, curb gutters, and miscellaneous storm drain facilities along Pechanga Parkway, will start as soon Phase IIA is completed and the NEPA environmental document is approved. We anticipate that construction will begin no later than January 2005. The Plans and specifications for the Pechanga Parkway Storm Drain Improvement Project, Phase IIA, Project No. PW99-11SD have been completed and the project is ready to be advertised for construction bids. The bid documents are available for review in the City Engineer's office. The Engineer's Estimate for the construction of the two phases for this project is $16,500,000.00. Phase IIA, storm drain improvements, is estimated to be $5,500,000. FISCAL IM PACT: The Pechanga Parkway Phase II Improvement Project, Project No. PW99-11, is a Capital Improvement Project funded through Development Impact Fees - Street Improvements, a contribution from the Pechanga Indian Tribe ($4,400,000), a Federal Public Lands and Highways Grant ($4,000,000), the Wolf Creek Community Facilities District, and AD-159. To date, only the Development Impact Fees and a portion of the Pechanga Indian Tribe contribution are available to fund these improvements. Some of these available funds have been expended on the construction and administration of the interim 4-lanes along Pechanga Parkway, design of the ultimate improvements including the sound walls, and construction of the sound wall. The estimated construction cost of the entire project, storm drain and street improvements, and right of way acquisition is $18,282,000.00. In order to move forward and start construction of Phase IIA, constructing the box culvert and the concrete channel, and since Federal funds can't be used for this phase, an advance will be necessary to fund construction, administration, and construction engineering. This amount is estimated to be $6,084,000. As soon as the Wolf Creek CFD Bond proceeds are available, this amount can be returned to its source. A'I-FACHMENT: 1. Project Location 2. Project Description 2 R:~AG E NDA REPORTS~003~51303~PW99-11t~iD.doc Z © ITEM 28 TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City ManagedCity Council APPROVAL . CITY ATTORNEY II D I RECTO R O F FINAIXI~E___,~i~:~_ II CITY MANAGER ~/'~,) ' I William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Approval of the Plans and Specifications and Authorization to Solicit Construction Bids for the Pavement Rehabilitation Program 2002-03 Rancho California Road, Project No. PW02-13 PREPARED BY: Greg Butler, Principal Engineer Brian Guillot, Assistant Engineer RECOMMENDATION: That the City Council approve the Construction Plans and Specifications and authorize the Department of Public Works to solicit construction bids for the Pavement Rehabilitation Program 2002-03 Rancho California Road, Project No. PW02-13. BACKGROUND: This Pavement Rehabilitation Program Project is part of the City overall Pavement Management System (PMS). The PMS, which was updated the last quarter of 2002, surveyed all major streets within the City and ranked them by order of need for repair work. This segment of Rancho California Road is identified in the PMS as need rehabilitation as soon as possible. This project involves removing and replacing failing asphalt concrete and base materials in the westbound travel lanes of Rancho California Road between Meadows parkway and Margarita Road. The specifications and contract documents have been completed and the project is ready to be advertised for construction bids. The contract document is available for review in the City Engineer's office. The Engineer's Construction Estimate for this project is $700,000.00. FISCAL IMPACT: This project is funded with Capital Project Reserves, Measure A, and AB 2928 funds. Adequate funds are available project account No. 210-165-655-5804 ATrACHMENTS: Location Map 1 R:\AGENDA REPORTS~003~051303\PW02-13BID.DOC Corona TO Riv~ide lTo.Hemet Temecula To .San :Diego VIClNITYMAP ITEM 29 TO: FROM: DATE: SUBJECT: DIRECTOR OF FINANCE-~--_--_--_--_--_--_--_--~ CITY MANAGER CITY OF TEMECULA AGENDA REPORT City Manager/City Council ~/~William G. Hughes, Director of Public Works/City Engineer May 13, 2003 Rancho California Road Widening and Median Modifications East of Ynez Road, Project No. PW00-20 Environmental Assessment and Authorization to Solicit Bids PREPARED BY: Amer Attar, Principal Engineer Steve Charette, Assistant Engineer RECOMMENDATION: That the City Council: 1. Adopt a resolution entitled: RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING A NEGATIVE DECLARATION FOR THE RANCHO CALIFORNIA ROAD WIDENING AND MEDIAN MODIFICATIONS EAST OF YNEZ ROAD PROJECT PW00-20 Approve the Project Plans and Specifications and authorize the Department of Public Works to solicit bids for the Rancho California Road Widening and Median Modifications East of Ynez Road Project No. PW00-20. BACKGROUND: This project will consist of the construction of a right turn lane from west-bound Rancho California Road to north-bound Ynez Road. The right turn lane will begin just west of the Claim Jumper Restaurant driveway entrance and will include the relocation of traffic signal control devices, curb gutter and sidewalk. This project has been combined with the Rancho California Road Median Modification Project, PW00-02. The median modification project will consist of closing two median openings along Rancho California Road adjacent to the Town Center Plaza. The two openings are located at the Claim Jumper Restaurant and Target Store driveway entrances. The closure modifications will include raised median improvements with planter areas containing rose bushes consistent with the current landscaping layout. The median project was authorized for solicitation of bids at the November 27, 2001 City Council meeting. In accordance with the California Environmental Quality Act ("CEQA"), City staff prepared an Initial Study (Environmental Assessment No. EA-68) of the potential environmental effects of the proposed project. Based on the findings contained in that Study, staff determined that there was no substantial evidence that the project could have a significant impact on the environment and a Negative Declaration has been prepared. In regards to the proposed median portion of R:\agdrpt\03\0513\PW00-20 NegDecBid.doc the project, it has been previously determined under separate review that the median construction is exempt from environmental assessment. Staff recommends that the City Council approve the Negative Declaration for the Rancho California Road Widening and Median Modifications East of Ynez Road Project, approve the plans and specifications and authorize staff to solicit bids. FISCAL IMPACT: An appropriation of funding from Capital Project Reserves has been recommended for this project as part of the 2003-2004 fiscal year budget. No fiscal impact is anticipated as a result of City Council approval of the project Negative Declaration. ATTACHMENTS: 1. Resolution No. 2003- 2. Initial Study R:~agdrpt\03\0513\PW00-20NegDecBid.doc 2 RESOLUTION NO. 2002- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING A NEGATIVE DECLARATION FOR THE RANCHO CALIFORNIA ROAD WIDENING AND MEDIAN MODIFICATIONS EAST OF YNEZ ROAD PROJECT PW00-20 THE CITY COUNCIL OF THE CITY OF TEMECULA HEREBY RESOLVES AS FOLLOWS: Section 1. The City Council of the City of Temecula does hereby find, determine and declare that: A. A project is proposed by the City to construct a right turn lane form west- bound Rancho California Road to north-bound Ynez Road and to modify the raised medians between Ynez Road and Via Las Colinas. The right turn lane portion of the project will include the relocation of traffic signal control devices, curb & gutter and sidewalks between the Ynez Road and the first Rancho California Road driveway east of Ynez Road. The proposed right turn lane will expedite right turn traffic through the intersection and facilitate more efficient through-traffic access to the freeway. The median improvements will consist of the closing two median openings along Rancho California Road adjacent to the Town Center Plaza. The two openings are located at the Claim Jumper Restaurant and Target Store driveway entrances (immediately west and east of the signalized intersection at Town Center Drive, respectively). The openings are being closed in order to eliminate traffic collisions caused by left-turn movements into the plaza and the need for longer left-turn pockets at the 3 signalized intersections. B. In accordance with the California Environmental Quality Act ("CEQA"), City staff prepared an Initial Study (Environmental Assessment No. EA-68) of the potential environmental effects of the proposed project. Based on the findings contained in that Study, staff determined that there was no substantial evidence that the project could have a significant impact on the environment and a Negative Declaration has been prepared. A copy of the Initial Study and Negative Declaration are attached hereto as Exhibit "A" and incorporated herein by reference. Under separate review it was determined that construction of the median portion of the project was exempt from environmental assessment. C. Thereafter, City staff provided public notice of the public comment period and of the intent to adopt the Negative Declaration as required by law and copies of the documents have been available for public review and inspection at the offices of the Department of Community Development, located at City Hall, 43200 Business Park Drive, Temecula, Ca. 92589. D. The City Council has reviewed the Negative Declaration and all comments received regarding the Negative Declaration and, based on the whole record before it, finds that: (1) The Negative Declaration was prepared in compliance with CEQA; (2) there is no substantial evidence that the Project will have a significant effect on the environment; and (3) the Negative Declaration reflects the independent judgment and analysis of the City Council. Section 2. Based on these findings set forth in Section 1., the City Council hereby adopts the Negative Declaration prepared for the Project. R:\agdrpt\03\0513~W00-20NegDecSid.doc 3 Section 3. The Director of Community Development shall file a Notice of Determination in the offices of the County Clerk of the County of Riverside and pay all fees in connection with the approval of the Negative Declaration. Section 4. The City Clerk shall certify to the adoption of this Resolution. PASSED, APPROVED AND ADOPTED by the City Council of the City of Temecula this 13~ day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC, City Clerk STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE )ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, California, do hereby certify that Resolution No. 2003-__ was duly and regularly adopted by the City Council of the City of Temecula at a regular meeting thereof held on this 13th day of May, 2003, by the following vote: AYES: NOES: ABSENT: COUNCILMEMBERS: COUNCILMEMBERS: COUNCILMEMBERS: Susan W. Jones, CMC, City Clerk R:~agd rpt\03\0513\PW00-20NegDecBid.doc 4 City of Temecula Planning Department Notice of Proposed Negative Declaration PROJECT: APPLICANT: LOCATION: DESCRIPTION: Environmental Assessment No. EA-80 (Widening of Rancho California Road - PW 00-20) City of Temecula Rancho California Road east of Ynez Road in the City of Temecula, County of Riverside, California. The construction of a right turn lane from west-bound Rancho California Road to north-bound Ynez Road. The project includes the relocation of drainage facilities, curb and gutter, sidewalks, streetlights and traffic control devices. The project will also include the construction of a small retaining wall and the acquisition of approximately 4,000 square feet of additional right-of-way. The City of Temecula intends to adopt a Negative Declaration for the project described above. Based upon the information contained in the attached Initial Environmental Study and pursuant to the requirements of the California Environmental Quality Act (CEQA); it has been determined that this project as proposed, revised or mitigated will not have a significant impact upon the environment. As a result, the City Council intends to adopt a Negative Declaration for this project on April 24, 2001. The Comment Period for this proposed Negative Declaration is 03-19-2001 to 4-14-2001. Written comments and responses to this notice should be addressed to the contact person listed below at the following address: City of Temecula, P.O. Box 9033, Temecula, CA 92589~9033. City Hall is located at 43200 Business Park Drive. ~x The Local Newspaper. _ Posting the Site. _ Notice to Adjacent Property Owners. If you need additional information or have any questions concerning this project, please contact David Hogan, Senio(r~.~ at (90,x9~69~4~__100. Prepared by: \l ~ ¼ Jl .~L~'?...._ ~'x/[~ ['-~,~c,., ' (Signature) ' 0 (Name and Title) R:\EA\Ea80\Notice of Proposed Negative Declaration.doc City of Temecula Planning Department Agency DistribUtion List PROJECT: Environmental Assessment No. EA-80 (Widening of~,ancho Califomia Road) DISTRIBUTION DATE: 3/16/2001 CASE PLANNER: David Hogan CITY OF TEMECULA: Building & Safety ................................ Fire Department .................................. Police Department ............................... Parks & Recreation (TCSD) ................... Planning, Advance ............................... Public Works ..................................... STATE: Caltrans ............................................ Fish & Game ..................................... Mines & Geology ................................ Regional Water Quality Control Bd .......... State Clearinghouse .............................. State Clearinghouse (10 Copies) .............. Water Resources ................................. . FEDERAL: Army Corps of Engineers ...................... ( Fish and Wildlife Service ...................... ( CITY OF MURRIETA: ~ Planning ............................................ ( RIVERSIDE COUNTY: Airport Land Use Commission ................. ( Engineer ............................................ ( Flood Control ..................................... ( ) Health Department ............................... ( ) Parks and Recreation ............................. ( ) Planning Department ............................. ( ) Habitat Conservation Agency (RCHCA) ..... ( ) Riverside Transit Agency ......................(..) ........... ( ) UTILITY: Eastern Municipal Water District .............. (x) Inland Valley Cablevision ....................... (x) Rancho CA Water District, Will Serve ....... (x) Southern California Gas ......................... (x) Southern California Edison .....................(x) Temecula Valley School District ............... ( ) Metropolitan Water District ....................( ) REGIONAL: Air Quality Management District ............. (..) Western Riverside COG ........................ (..) .......... () OTHER: Pechanga Indian Reservation .................. (..) Eastern Information Center ..................... ( ) Local Agency Formation Coinm ............... ( ) RCTC .............................................. ( ) Homeowners' Association ..................... (..) R:\EA\Ea80\Notice of Proposed Negative Declaration.doc 2 City of Temecula P.O. Box 9033 Temecula, CA 92589-9033 Environmental Checklist Project Title Lead Agency Name and Address Contact Person and Phone Number Project Location Project Sponsor's Name and Address General Plan Designation Zoning Description of Project Surrounding Land Uses and Setting Other public agencies whose approval is required Environmental Assessment No. EA-80 - Rancho California Road Widening (PW00-20) City of Temecula P.O. Box 9033, Temecula, CA 92589-9033 David Hogan, Senior Planner (909) 694-6400 Rancho California Road east of Ynez Road in the City of Temecula, County of Riverside, California. City of Temecula Arterial Roadway (4-lane with raised median) and Community Commercial Community Commercial The construction of a right turn lane from west-bound Rancho California Road to north-bound Ynez Road. The project includes the relocation of drainage facilities, curb and gutter, sidewalks, street lights and traffic control devices. The project will also include the construction of a small retaining wail and the acquisition of approximately 4,000 square feet of additional right-of-way. (Public Works Project PW 00-20.) Landscaped areas for developed commemial properties. No outside agency permits are required. Location Map R:\EA\EaS0\lnitial Environmental Study.doc Environmental Factors Potentially Affected The environmental factors checked below would be potentially affected by this project, involving.a,..t least one impact that is a "Potentially Significant Impact" as indicated by the checklist on the following pages. Land Use Planning Population and Housing Geologic Problems Water Air Quality Transportation/Circulation Biological Resources Energy and Mineral Resources Hazards Noise Public Services Utilities and Service Systems Aesthetics Cultural Resources Recreation Mandatory Findings of Significance None Determination (To be completed by the lead agency) On the basis of this initial evaluation: Signature I find that the proposed project COULD NOT have a significant on the environment, and a NEGATIVE DECLARATION will be prepared I find that although the proposed project could have a significant effect on the environment, there will not be a significant effect in this case because revisions in the project have been made by or agreed to by I the project proponent. A MITIGATED NEGATIVE DECLARATION will be prepared. I find that the proposed project MAY have a significant effect on the environment, and an ENVIRONMENTAL IMPACT REPORT is required I find that the proposed project MAY have a "potentially significant impact" or "potentially significant unless mitigated" impact on the environment, but at least one effect 1) has been adequately analyzed in an earlier document pursuant to applicable legal standards, and 2) has been addressed by mitigation measures based .on the earlier analysis as described on attached sheets, if the effect is a "potentially significant impact" or "potentially significant unless mitigated." An ENVIRONMENTAL IMPACT REPORT is required, but it must analyze only the effects that remain to be addressed. I find that although the proposed project could have a significant effect on the environment, because all potentially significant effects (a) have been analyzed adequately in an earlier EIR or NEGATIVE DECLARATION pursuant to applicable standards, and (b) have been avoided or mitigated pursuant to that earlier EIR or NEGATIVE DECLARATION, including revisions or mitigation measures that are imposed upon the proposed project, nothing further is required. I find that the proposed project WOULD NOT have a significant impact on the environment, and that the approval of a CATEGORICAL EXEMPTION is appropriate. · 0 Date David Hoclan Printed name R:\EA\Ea80\lnitial Environmental Study.doc 2 1. Land Use and Planning. Would the project: Poteotially Poteotially Significant Un~ess Less Than Significant Mitigation Significant No Issues and Supporting information Sources Impact incorporated Impact impact a. Physically divide an established community? ~/ b. Conflict with applicable land use plan, policy, or ~/ regulation of an agency with jurisdiction over the project (including, but not limited to the general plan, specific plan, local coastal program, or zoning ordinance) adopted for the purpose of avoiding or mitigation an environmental effect? c. Conflict with any applicable habitat conservation plan or ~/ natural community conservation plan? Comments: The proposed road widening will not physically divide an established community, conflict with applicable land use plan, policy, or regulation, and does not conflict with any applicable habitat plans. The proposed roadway improvements are also consistent with the City's General Plan. As a result, no significant impacts are expected to occur. 2. POPULATION AND HOUSING. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant NO issues and SupF~3rtin~l Information Sources Impact Incorporated Impact Impact a. Induce substantial population growth in an area, either ~/ directly (for example, by proposing new homes and businesses) or indirectly (for example, through extension of roads or other infrastructure)? b. Displace substantial numbers of existing housing, ~/ necessitating the construction of replacement housing elsewhere? c. Displace substantial numbers of people, necessitating the ~/ construction of replacement housing elsewhere? Comments: The proposed road widening will not displace any housing units or local residents. The widening is also not expected to induce substantial population growth in the area. The project is intended to meet current infrastructure needs. As a result, no significant impacts are expected to occur. R:\EA\Ea80\lnitial Environmental Study.doc 3 3. GEOLOGY AND SOILS. Would the project? Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supportin~ Information Sources impact Incorporated Impact Impact a. Expose people or structures to potential substantial adverse effects, including the risk of loss, injury, or death involving! i) Rupture of a known earthquake fault, as delineated on the most recent Alquist-Priolo Earthquake Fault Zoning Map issued by the State Geologist for the area or based on other substantial evidence of a known fault? Refer to Division of Mines and Geology Special Publication 42. ii) Strong seismic ground shaking? iii)Seismic-related ground failure, including liquefaction? iv) Landslides?' b. Result in substantial soil erosion or the loss of topsoil? c. Be located on a geologic unit or soil that is unstable, or that would become unstable as a result of the project, and potentially result in on- or off-site landslide, lateral spreading, subsidence, liquefaction or collapse? d. Be located on expansive soil, as defined in Table 1801-B of the Uniform Building Code (1994), creating substantial risks to life or property? e. Have soil incapable of adequately supporting the use of septic tanks or alternative wastewater disposal systems where sewers are not available for the disposal of wastewater? Comments: The proposed road widening will not expose people or property to any significant impacts or effects caused by geology or soils. Any improvements will be constructed to meet the appropriate building and safety standards. As a result, no significant impact effects are expected to occur. 4. HYDROLOGY AND WATER QUALITY. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact a. Violate any water quality standards or waste discharge ~/ requirements? b. Substantially deplete groundwater supplies or interfere ~/ substantially with groundwater recharge such that there would be a net deficit in aquifer volume or a lowering of the local groundwater table level (e.g., the production rate of pre-existing nearby wells would drop to a level which would not support existing land uses or planned uses for which permits have been granted)? R:\EA\Ea80\lnitial Environmental Study.doc 4 4. HYDROLOGY AND WATER QUALITY. Would the project: Potenfia~ly Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact c. Substantially alter the existing drainage pattern of the site or area, including through the alteration of the course of a stream or river, in a manner which would result in substantial erosion or siltation on- or off-site? d. Substantially alter the existing drainage pattern of the site or area, including through the alteration of the course of a stream or river, or substantially increase the rate or amount of surface runoff in a manner which would result in flooding on- or off-site? e. Create Or contribute runoff water which would exceed the capacity of existing or planned storm water drainage systems or provide substantial additional sources of polluted runoff? f. OtherWise substantially degrade water quality? g. Place housing within a 100-year flood hazard area as mapped on a federal Flood Hazard Boundary or/Flood Insurance Rate Map or other flood hazard delineation map? h. Place within a 100-year flood hazard area structures which would impede or redirect flood flows? i. Expose people or Structures to a significant risk of loss, injury or death involving flooding, including flooding as a result of the failure of a levee or dam? j. Inundation by seiche, tsunami, or mudflow? Comments: The proposed road widening will not effect water quality or existing water courses. However the project may result in a small incremental increase in runoff volumes because of the increased paved surface. The proposed road widening will not effect hydrology or water quality standards beyond current roadway runoff levels. The project will not change the direction of surface or ground water flows. The widening will not expose people or property to any significant impacts or effects caused by flooding. As a result, no significant impact effects are expected to occur. 5. AIR QUALITY. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact a. Conflict with or obstruct implementation of the applicable air quality plan? b. Violate any air quality standard or contribute substantially to an existing or proiected air quality violation? R:\EA\Ea80~Jnitial Environmental Study.doc 5 5. AIR QUALITY. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact c. Result in a cumulatively considerable net increase of any ~/ criteria pollutant for which the project region is non- attainment under an applicable federal or state ambient air quality standard (including releasing emissions which exceed quantitative thresholds for ozone precursors? d. Expose sensitive receptors to substantial pollutant ~/ concentrations? e. Create objectionable odors affecting a substantial number ~/ of people? Comments: The proposed road widening will not impact or adversely effect air quality. Some limited local improvement in air quality may result from increased traffic flow and reduced congestion along Rancho California Road. As a result, no significant impact effects are expected to occur. 6. TRANSPORTATION/TRAFFIC. Would the project: Potentially Potentialty Significant Unless Less Than Significant Mitigation Significant No Issues and Supportin~ Information Sources Impact Incorporated Impact Impact a. Cause an increase in traffic which is substantial in relation to the existing traffic load and capacity of the street system (i.e., result in a substantial increase in either the number of vehicle trips, the volume to capacity ratio on roads, or congestion at intersections)? b. Exceed, either individually or cumulatively, a level of service standard established by the county congestion management agency for designated roads or highways? c. Result in a change in air traffic patterns, including either an increase in traffic levels or a change in location that results in substantial safety risks? d. Substantially increase hazards due to a design feature (e.g., sharp curves or dangerous intersections) or incompatible uses (e.g., farm equipment)? e. Result in inadequate emergency access? f. Result in inadequate parking capacity? g. Conflict with adopted policies, plans, or programs supporting alternative transportation (e.g., bus turnouts, bicycle racks? R:\EA\Ea80\lnitial Environmental Study.doc 6 Comments: The proposed road widening will not adversely impact vehicular cimulation in this area. The project is expected to improve vehicular circulation and emergency access by adding a turn lane that will allow a more efficient turning movement. These improvements are not expected to attract additional vehicle trips to this area. However, the additional widening may further impact the movements of pedestrians through this area by increasing the width of the road surface to be crossed. The installation of this lane may also further impact the use of this area by bicyclists by making travel along this segment of Rancho California Road either more difficult or by feeling less safe to use. As a result, no significant impact effects are expected to occur. 7. BIOLOGICAL RESOURCES: Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact a. Have a substantial adverse effect, either directly or ~/ through habitat modifications, on any species identified as a candidate, sensitive, or special status species in local or regional plans, policies, or regulations, or by the California Department of Fish and Game or U.S. Fish and Wildlife Service? b. Have a substantial adverse effect on any riparian habitat ~/ or other sensitive natural community identified in local or regional plans, policies, and regulations or by the California Department of Fish and Game or US Fish and Wildlife Service? c. Have a substantial adverse effect of federally protected ~/ wetlands as defined by Section 404 of the Clean Water Act (including, but not limited to, marsh, vernal pool, coastal, etc.) through direct removal, filing, hydrological interruption, or other means? d. Interfere substantially with the movement of any native ~/ resident or migratory fish or wildlife species or with established native resident or migratory wildlife corridors, or impede the use of native wildlife nursery sites? e. Conflict with any local policies or ordinances protecting ~/ biological resources, such as a tree preservation policy or ordinance? f. Conflict with the provisions of an adopted habitat ~/ Conservation Plan, Natural Community Conservation Plan, or other approved local, regional, or state habitat conservation plan? Comments: 7.all. The proposed road widening will not significantly affect important biologic resources. The areas of expansion are currently occupied with existing sidewalks and commercial landscaping. No significant impacts are anticipated. R:\EA\Ea80'dnitial Environmental Study.doc 7 8. MINERAL RESOURCES. Would the project: Potenfially Pctenfialiy Significant Unless Less Than Significant Mif[gation Significant No Issues and Supporting Information Sources Impact incorporated Impact Impact a. Result in the loss of availability of a known mineral ~J resource that would be of value to the region and the residents of the state? b. Result in the loss of availability of a locally important ~/ mineral resource recovery site delineated on a local general plan, specific plan or other land use plan? Comments: The proposed widening entails the use of a small increment of commonly used construction materials. In addition, this widening will not reduce locally important mineral resources. As a result, no effects are expected from this project. 9. HAZARDS AND HAZARDOUS MATERIALS. Would the project: Potentially Potential!y Significant Unless Less Than Significant Mitigation Significant No issues and Supportin~ Information Sources Impact Incorporated Impact Imp,act a. Create a significant hazard to the public or the environment through the routine transportation, use, or disposal of hazardous materials? b. Crate a significant hazard to the public or the ~/ environment through reasonably foreseeable upset and accident conditions involving the release of hazardous materials into the environment? c. Emit hazardous emissions or handle hazardous or ~/ acutely hazardous materials, substances, or acutely hazardous materials, substances, or waste within one- quarter mile of an existing or proposed school? d. Be located on a site which is included on a list of ~/ hazardous materials sites compiled pursuant to Government Code Section 65962.5 and, as a result, would it create a significant hazard to the public or the environment? e. For a project located within an airport land use plan or, ~/ where such a plan has not been adopted, within two miles or a public airport or public use airport, would the project result in a safety hazard for people residing or working in the project area? f. For a project within the vicinity of a private airstrip, would ~/ the project result in a safety hazard for people residing or working in the project area? g. Impair implementation of or physically interfere with an ~ adopted emergency response plan or emergency evacuation plan? R:\EA\Ea80\lnitial Environmental Study.doc 9. HAZARDS AND HAZARDOUS MATERIALS. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact impact h. Expose people or structures to a significant risk or loss, ~/ injury or death involving wiidland fires, including where wildlands are adjacent to urbanized areas or where residences are intermixed with wildlands? Comments: The widening of Rancho California Road will not expose area residents to any hazardous or materials not commonly transported through this area and found in the adjacent neighborhoods. The project site is not located within the safety area for any public or private airports. As a result, no impacts are expected from this project. 10. NOISE. Would the project result in: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated impact Impact ia. Exposure of people to severe noise levels in excess of ~/ standards established in the local general plan or noise ordinance, or applicable standards of other agencies? b. Exposure of persons to or generation of excessive v~ groundborne vibration or groundborne noise levels? c. A substantial permanent increase in ambient noise levels ~/ in the project vicinity above levels existing without the project? d. A substantial temporary or periodic increase in ambient ~/ noise levels in the project vicinity above levels existing without the project? e. For a project located within an airport land use plan or, ~/ where such a plan has not been adopted, within two miles of a public airport or public use airport, would the project expose people residing or working in the project area to excessive noise levels? f. For a project within the vicinity of a private airstrip, would ~/ the project expose people residing or working in the project area to excessive noise levels? Comments: lO.all. Some additional construction-related noise is expected to occur while the project is being constructed. However, these impacts will be of relatively short duration and will largely be confined to daylight hours. There are no residential land uses adjacent to this project location. Future build-out noise levels were addressed in the Noise Element of the adopted General Plan. As a result, the environmental analysis in the General Plan addressed the impacts on the current residents of this area. Finally, traffic volumes on Rancho California Road have increased over time as previously approved projects have been constructed and occupied. This increase in vehicle noise has occurred even without any additional Improvements in this area. The use of Rancho California Road by residents and visitors will continue increase future road noise levels even without these improvements. The project does not include an R:\EA\Ea80\lnitial Environmental Study.doc airport component and could not expose people to increased aircraft noise. As a result, not impacts are expected. 11. PUBLIC SERVICES: Would the proposal have an effect upon, or result in a need for new or altered Government services in any of the following areas: Potentially PotentiallySignificant Unless Less Than SignificantMitigation Significant NO ~ssues and Supporting Infom3ation Sources Impact Incorporated Impact Impact a. Would the project result in substantial adverse physical ~/ impacts associates with the provisions of new or physically altered governmental facilities, need for new or physically altered governmental facilities, the construction of which could cause significant environmental impacts, in order to maintain acceptable service ratios, response times or other pedormance objectives for any of the public services? b. Fire protection? ~/ c. Police protection? ~ d. Schools? ~/ e. Parks? ~/ f. Other public facilities? ~/ Comments: 11.all. The proposed widening of Rancho California Road will not affect the demand for, or adversely effect, public services. This project may result in a small incremental increase in road maintenance costs; however, a portion of this project represents current City road maintenance functions. As a result, no effects are expected from this project. 12. UTILITIES AND SERVICE SYSTEMS: Would the project: Potenfially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporfin,q Information Sources !mpact Incorporated Impact Imp,act a. Exceed wastewater treatment requirements of the applicable Regional Water Quality Control Board? b. Require or result in the construction of new water or ~/ wastewater treatment facilities or expansion of existing facilities, the construction of which could cause significant environmental effects? c. Requi~'e or result 'in the construction of new storm water ~/ drainage facilities or expansion of existing facilities, the construction of which could cause significant environmental effects? d. Have sufficient water supplies available to serve the ~/ project from existing entitlements and resources, or are new or expanded entitlements needed? R:\EA\Ea80~lnitial Environmental Study.doc 10 12. UTILITIES AND SERVICE SYSTEMS: Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant NO Issues and Supporting Information Sources Impact Incorporated Impact Impact e. Result in a determination by the wastewater treatment provider which serves or may serve the project that it has adequate capacity to serve the project's projected demand in addition to the provider's existing commitments? f. Be served by a landfill with sufficient permitted capacity to accommodate the project's solid waste disposal needs? g. Comply with federal, state, and local statutes and regulations related to solid waste? Comments: 12.a11. The proposed widening of Rancho California Road will not affect public utilities or service systems. The project is expected to tie into and to use the existing storm runoff system serving this area. As a result, no effects are expected from this project. 13. AESTHETICS. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No lssu~s and Supp?rting Informafi(~n Sources Impact Incorporated Impact Impact a. Have a substantial adverse effect on a scenic vista? b. Substantially damage scenic resources, including, but not limited to, trees, rock outcropping, and historic building within a state scenic highway? lc. Substantially degrade the existing visual character or quality of the site and its surroundings? id. Create a new source of substantial light or glare which would adversely affect day or nighttime views in the area? Comments: 13.all. The proposed widening of Rancho California Road will not noticeably affect current views or vistas in this area. Also, Rancho California Road has not been designated as a scenic roadway. As a result, no effects are expected from this project. R:\EA\Ea80\lnitial Environmental Study.doc 11 14. CULTURAL RESOURCES. Would the project: Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No issues and Supporting ~nformation Sources Impact Incorporated Impact Impact a. Cause a substantial adverse change in the significance of ~/ a historical resource as defined in Section 1506.57 b. Cause a sub§tantial adverse change in the significance of ~J an archaeological resource pursuant to Section 1506.57 c. Directly or indirectly destroy a unique paleontological ,] resource or site or unique geologic feature? d. Disturb any human remains, including those interred ~/ outside of formal cemeteries? Comments: 14.all. The roadway and shoulder areas have been extensively graded and modified over the years and the discovery of cultural resources is not expected occur in such highly disturbed soil conditions. Since the General Plan identifies the area as archaeologically sensitive area, a qualified amheologist shall be present if cultural resoumes are detected during the grading operations. As a result, no impacts are anticipated. 15. RECREATION. Would the project: Potentially Potentially Significant Un~ess Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated Impact Impact a. Would the project increase the use of existing ~/ neighborhood and regional parks or other recreational facilities such that substantial physical deterioration of the facility would occur or be accelerated? b. Does the project include recreational facilities or require ~/ the construction or expansion of recreational facilities which might have an adverse physical effect on the environment? Comments: 15.a11. The proposed widening of Rancho California Road will not affect the demand for, or adversely effect, recreational facilities. As a result, no effects are expected from this project. R:\EA\Ea80\lnit[al Environmental Study.doc 12 16. MANDATORY FINDINGS OF SIGNIFICANCE. Potentially Potentially Significant Unless Less Than Significant Mitigation Significant No Issues and Supporting Information Sources Impact Incorporated ImDact Impact a. Does the project have the potential to degrade the quality ~/ of the environment, substantially reduce the habitat of a fish or wildlife species, cause a fish or wildlife population to drop below self-sustaining levels, threaten to eliminate a plant or animal community, reduce the number of restrict the range of a rare or endangered plant or animal or eliminate important examples of the major periods of California history or prehistory? b. Does the project have impacts that are individually ~/ limited, but cumulatively considerable? ("Cumulatively considerable" means that the incremental effects of a project are considerable when viewed in connection with the effects of past projects, the effects of other current projects, and the effects of probable future projects? c. Does the project have environmental effects which will ~/ cause substantial adverse effects on human beings, either directly or indirectly? 17. EARLIER ANALYSES. Earlier analyses may be used where, pursuant to the tiering, program EIR, or other CEQA process, one or more effects have been adequately analyzed in an earlier EIR or negative declaration. Section 15063(c)(3)(D). In this case a discussion should identify the following on attached sheets. a. Earlier analyses used. Identify earlier analyses and state where they are available for review. b. Impacts adequately addressed. Identify which affects from the above checklist were within the scope of and adequately analyzed in an earlier document pursuant to applicable legal standards, and state whether such effects were addressed by mitigation measures based on the earlier analysis. c. Mitigation measures. For effects that are "Less than Significant with Mitigation incorporated," describe the mitigation measures which were incorporated or refined from the earlier document and the extent to which they address site-specific conditions for the project. SOURCES City of Temecula General Plan. City of Temecula General Plan Final Environmental Impact Report. R:\EA\Ea80\lnitial Environmental Study.doc 13 TEMECULA COMMUNITY SERVICES DISTRICT ITEM 1 MINUTES OF A REGULAR MEETING OF THE TEMECULA COMMUNITY SERVICES DISTRICT APRIL 22, 2003 A regular meeting of the City of Temecula Community Services District was called to order at 7:38 P.M., at the City Council Chambers, 43200 Business Park Drive, Temecula, California. President Comerchero presiding. ROLL CALL PRESENT: 5 DIRECTORS: Naggar, Councilman Pratt, Roberts, Stone, Comerchero ABSENT: 0 DIRECTORS: None Also present were General Manager Nelson, City Attorney Thorson, and City Clerk Jones. PUBLIC COMMENTS No comments. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 8, 2003. 2 TCSD Proposed Rates and Charqes for FY 2003-2004 RECOMMENDATION: 2.1 Adopt a resolution entitled: RESOLUTION NO, CSD 03-06 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA COMMUNITY SERVICES DISTRICT ACKNOWLEDGING THE FILING OF A REPORT WITH RESPECT TO THE PROPOSED RATES AND CHARGES FOR FISCAL YEAR 2003-2004 AND SETTING A TIME AND PLACE FOR A PUBLIC HEARING IN CONNECTION THEREWITH MOTION: Director Stone moved to approve Consent Calendar Item Nos. 1 and 2. The motion was seconded by Director Naggar and voice vote reflected unanimous approval. Minutes.csd\040803 1 PUBLIC HEARING Tract Map Nos. 19872-1, -2, -3, -4, -5 and Final (Loma Linda Tract) for Service Level C, Perimeter Landscaping, and Slope Maintenance - Approve Staff Recommendation (5-0-0) MN/JS RECOMMENDATION: 3.1 Adopt a resolution entitled: RESOLUTION NO. CSD 03-07 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA COMMUNITY SERVICES DISTRICT ORDERING, CALLING, AND GIVING NOTICE OF AN ELECTION TO BE HELD ON JUNE t2, 2003, REGARDING SERVICE LEVEL C RATES AND CHARGES FOR TRACT MAP NOS. t9872-1, -2, -3, -4, -5, AND FINAL IN ORDER TO ESTABLISH SERVICE LEVEL C RATES AND CHARGES BEGINNING FISCAL YEAR 2003-2004 PURSUANT TO ARTICLE XlIID, SECTION 6, OF THE CALIFORNIA CONSTITUTION 3.2 Approve the Election Notice, Ballot, and Procedures for the Completion, Return, and Tabulation of the Ballots; 3.3 Authorize staff to mail the ballots to the affected property owners pursuant to the aforementioned process. Community Services Director Parker reviewed the staff report (as per agenda material). President Comerchero opened the public hearing. There being no public input, the public hearing was closed. Director Pratt commented on the benefits derived through the Community Services District. Commending staff on a job well done, President Comerchero advised that the proposed action, if approved, will provide the method to clean the stretch along Pechanga Parkway. DEPARTMENTAL REPORT No additional comments. DIRECTOR OF COMMUNITY SERVICES REPORT Thanking the community for its attendance at the Annual Spring Egg Hunt and the Military Support Day, Community Services Director Parker relayed his appreciation to Police Chief Domenoe and Community Services Officer Fanene for their associated efforts. Minutes.csd\040803 2 GENERAL MANAGER'S REPORT No comment. BOARD OF DIRECTORS' REPORTS A. In response to Director Stone's comments with regard to the City's successful Summer Months Activities and Recreation in Temecula (SMART) Program, Community Services Director Parker advised that this year's SMART program is being planned, noting that the program will be offered Monday - Friday for four hours a day at no charge; that the program will begin once school is out; that the program will be located at seven different park sites; and that the program will be advertised in the Community Services Brochure. B. For Director Naggar, Community Services Director Parker advised that plans for the Movies in the Park program are as well underway. ADJOURNMENT At 7:42 P.M., the Temecula Community Services District meeting was formally adjourned to Tuesday, May 13, 2003, at 7:00 P.M., City Council Chambers, 43200 Business Park Drive, Temecula, California. Jeff Comerchero, President ATTEST: Susan W. Jones, CMC City Clerk/District Secretary [SEAL] Minutes.csd\040803 3 ITEM 2 APPROVA~,,<-'~ CiTY ATTORNEY FINANCE DIRECTOR_~____ CiTY MANAGER /~-"~, ) TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT Board of Directors Herman D. Parker, Director of Community Services May 13, 2003 Sub-Committee for Veteran's War Memorial RECOMMENDATION: That the Board of Directors appoint Mayor Jeff Stone and Temecula Community Services District President Jeff Comerchero to serve on a sub-committee for the development of a veteran's war memorial. BACKGROUND: At the request of Mayor Jeff Stone, staff has initiated the proceedings to design and develop a memorial to be constructed on a City park site to honor veterans of war. It is envisioned that the memorial will honor veterans from the recent war in Iraq, as well as significant war events in U.S. history. Mayor Jeff Stone proposed this concept at the April 8, 2003 City Council meeting. As a result, this staff repod recommends that Mayor Jeff Stone serve on the sub-committee, as well as Temecula Community Services District President Jeff Comerchero because of the park relevance to this project. The sub- committee will work in conjunction with staff and an ad-hoc design committee to develop a concept and master plan for a veteran's war memorial. FISCAL IMPACT: The formation of a sub-committee creates no fiscal impact at this time. ATTACHMENTS: None R:~ZIGLERG\REPORT~051303 BOD war memorial.doc REDEVELOPMENT AGENCY ITEM 1 MINUTES OF A REGULAR MEETING OF THE TEMECULA REDEVELOPMENT AGENCY APRIL 22, 2003 A regular meeting of the City of Temecula Redevelopment Agency was called to order at 7:42 P.M., in the City Council Chambers, 43200 Business Park Drive, Temecula. ROLL CALL PRESENT: 5 AGENCY MEMBERS: Comemhero, Naggar, Pratt, Stone, and Roberts ABSENT: 0 AGENCY MEMBER: None Also present were Executive Director Nelson, City Attorney Thorson, and City Clerk Jones. PUBLIC COMMENTS No input. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 8, 2003. MOTION: Agency Member Naggar moved to approve Consent Calendar Item No. 1. The motion was seconded by Agency Member Stone and voice vote reflected unanimous approval. EXECUTIVE DIRECTOR'S REPORT No comment. AGENCY MEMBERS' REPORTS No comments. ADJOURNMENT At 7:43 P.M., the Temecula Redevelopment Agency meeting was formally adjourned to Tuesday, May 13, 2003, in the City Council Chambers, 43200 Business Park Drive, Temecula, California. Ron Roberts, Chairman ATTEST: Susan W. Jones, CMC City Clerk/Agency Secretary [SEAL] R:'~vlin utes.rda\042203 TEMECULA PUBLIC FINANCING AUTHORITY ITEM 1 MINUTES OF A REGULAR MEETING OF THE TEMECULA PUBLIC FINANCING AUTHORITY APRIL 22, 2003 A regular meeting of the City of Temecula Public Financing Authority was called to order at 7:43 P.M., in the City Council Chambers, 43200 Business Park Drive, Temecula. ROLLCALL PRESENT: 5 AGENCY MEMBERS: Comerchero, Naggar, Pratt, Roberts, and Stone ABSENT: 0 AGENCY MEMBER: None Also present were Executive Director Nelson, City Attorney Thorson, and City Clerk Jones. PUBLIC COMMENTS No input. CONSENT CALENDAR 1 Minutes RECOMMENDATION: 1.1 Approve the minutes of April 8, 2003. MOTION: Agency Member Naggar moved to approve Consent Calendar Item No. 1. The motion was seconded by Agency Member Comerchero and voice vote reflected unanimous approval. PUBLIC HEARING 2 Community Services District No. 01-3 (Wolf Creek) RECOMMENDATION: 2.1 Continue the public hearing to the meeting of May 13, 2003. Executive Director Nelson briefly reviewed the recommendation to open the public hearing and to continue the public hearing to the meeting of May 13, 2003. MOTION: Agency Member Comerchero moved to open the public hearing and to continue the public hearing to the meeting of May 13, 2003. The motion was seconded by Agency Member Naggar and voice vote reflected unanimous approval. EXECUTIVE DIRECTOR'S REPORT No comment. R:minutes.tpfa\042203 I BOARD OF DIRECTORS' REPORTS No comments. ADJOURNMENT At 7:44 P.M., the Temecula Public Financing Authority meeting was formally adjourned. ATTEST: Jeffrey E. Stone, Chairman Susan W. Jones, CMC City Clerk/Agency Secretary [SEAL] R:min utes,tpfa\042203 2 ITEM 2 APPROVAL CITY ATT O R N E ~'L:~'~"~-c"~-~ DIR,OF FINANCE ~ CItY MANAGER ./~ TEMECULA PUBLIC FINANCING AUTHORITY AGENDA REPORT TO: FROM: DATE: SUBJECT: Temecula Public Financing Authority Executive Director Shawn Nelson May 13, 2003 Ratifying Election and Approval of Issuance of Bonds for Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) RECOMMENDATION: 1. That the Board of Directors adopt a resolution entitled: RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY CALLING SPECIAL RATIFYING ELECTION WITHIN COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2. That the Board of Directors hold an election ratifying the formation of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "CFD"), the levy of special taxes in the CFD, the incurrence of indebtedness of the CFD and an appropriations limit for the CFD, and then adopt the resolutions entitled: RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY DECLARING RESULTS OF SPECIAL RATIFYING ELECTION AND DIRECTING RECORDING OF NOTICE OF SPECIAL TAX LIEN R:/Agenda Reports/CFD 03-1 Crown Hill 1 RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS OF THE TEMECULA PUBLIC FINANCING AUTHORITY FOR TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL), APPROVING AND DIRECTING THE EXECUTION OF A FISCAL AGENT AGREEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS BACKGROUND: LENOne, Inc., an affiliate of Lennar Homes of California, Inc. ("Lennar"), PCClII - Crowne Hill, LLC, and KB Homes Coastal, Inc., three of the entities that own land in the Crowne Hill development (collectively, the "Original Landowners") have requested that the Authority form a community facilities district (the "CFD") to provide funds to eliminate a County special assessment lien on the land in the CFD (the "Prior Lien"), as well as to finance various public improvements to be constructed in the City of Temecula. On Mamh 25, 2003, (i) a public hearing was held regarding the formation of the CFD, (ii) the Board of Directors adopted a resolution of formation of the CFD, (iii) an election was held wherein the Original Landowners approved the CFD, the levy of a special tax on land located in the CFD, and the issuance of bonds by the Authority for the CFD, and (iv) the CFD was declared to be officially formed. At the time of the March 25th election, it was thought that the Original Landowners were the then owners of all of the land in the CFD. Subsequent to March 25, 2003, the Authority was advised that one or more of the Original Landowners had transferred ownership of parcels in the CFD to two other entities prior to the March 25th election, so that those two other entities did not have, but should have had, an opportunity to cast ballots in the election regarding the CFD. In order to confirm the establishment of the CFD, Bond Counsel has advised that the Authority should hold a new election at which all owners of property in the CFD as of March 25, 2003 are afforded an opportunity to vote regarding the CFD. Staff recommends that the Authority adopt a resolution calling for a special "ratifying" election for the CFD. Ballots for the new election have already been delivered to the Original Landowners and the two other entities that owned land in the CFD as of March 25th, and all five of the ballots are expected to have been returned to the City Clerk, acting as Secretary of the Authority, prior to May 13th. By law, the landowners are given one vote for each acre of land or portion thereof that they own within the boundaries of the CFD as of the close of the public hearing on the CFD that occurred on March 25th. The only eligible voters are the owners of land within the boundaries of the CFD, as such boundaries are indicated on the boundary map for the CFD on file with the Authority Secretary. The City Clerk, as Secretary to the Authority, will be requested to canvass the election immediately after adoption of the resolution calling for the special ratifying election. If two thirds or more of the votes cast are in favor of the CFD, the Authority is then requested to adopt a resolution declaring the results of the election and providing for the recording of an amended and restated notice of special tax lien with the County Recorder. The notice provides R:/Agenda Reports/CFD 03-1 Crowne Hill 2 all future property owners in the Crowne Hill development with knowledge of the existence of the Authority's special taxing powers. If the election is in favor of the CFD, the landowners would like the Authority to authorize the issuance of bonds for the CFD. In that regard, various documents have been prepared relative to the issuance of the bonds by the Authority for the CFD, including (i) a Fiscal Agent Agreement which provides the terms of the bonds to be issued and establishes the funds and accounts from which the CFD bond program will be administered; (ii) a Preliminary Official Statement which describes the bond program, to be used to assist in the offering of the bonds to potential investors; (iii) a Bond Purchase Agreement, whereby the bonds will be sold by the Authority to Stone & Youngberg LLC (the "Underwriter") for sale by the Underwriter to the public; and (iv) a Continuing Disclosure Agreement pursuant to which the Authority will agree to provide certain information regarding the bond program to bond investors and certain nationally-recognized information repositories. City Staff and consultants have reviewed these documents and they are now in form ready for approval by the Board of Directors so that the sale and issuance of the bonds for the CFD can occur. The maximum principal amount of the bonds that may be issued is $25,000,000. The proceeds of the bonds, will be used to eliminate the Prior Lien and to finance various public improvements specified in the CFD proceedings. If the Board of Directors adopts the Resolution authorizing the issuance of the bonds, it is expected that the bonds will be issued on or after June 11, 2003. FISCAL IMPACT: The CFD will be authorized to levy special taxes to repay its indebtedness, and to pay the annual costs of administration of the CFD. The CFD will only be authorized to levy the special taxes on land included within the boundaries of the CFD. The bonds will not be obligations of the City of Temecula, or general obligations of the Authority or the CFD, but will be limited obligations of the Authority for the CFD secured solely by the special taxes levied in the CFD and amounts held in certain funds and accounts established under the Fiscal Agent Agreement for the bonds. All costs of issuance of the bonds will be paid from the proceeds of the bonds. All administrative costs of the CFD and the bonds will be paid from proceeds of the special taxes levied in the CFD. Attachments: Resolutions (3) Amended and Restated Notice of Tax Lien Fiscal Agent Agreement Preliminary Official Statement Bond Purchase Agreement Continuing Disclosure Agreement R:/Agenda Report~CFD 03-1 Crowne Hill 3 RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY CALLING SPECIAL RATIFYING ELECTION WITHIN COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) WHEREAS, on Mamh 25, 2003, this Board of Directors adopted a resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority of Formation of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill), Authorizing the Levy of a Special Tax Within the District, Preliminarily Establishing an Appropriations Limit for the District and Submitting Levy of the Special Tax and the Establishment of the Appropriations Limit to the Qualified Electors of the District" (the "Resolution of Formation"), ordering the formation of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), authorizing the levy of a special tax on property within the District and preliminarily establishing an appropriations limit for the District; WHEREAS, on March 25, 2003, this Board of Directors also adopted a resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority Determining the Necessity to Incur Bonded Indebtedness Within Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) and Submitting Proposition to the Qualified Electors of the District" (the "Resolution to Incur Indebtedness"), determining the necessity to incur bonded indebtedness in the maximum aggregate principal amount of $25,000,000 upon the security of the special tax to be levied within the District; and WHEREAS, pursuant to the provisions of said resolutions, the propositions of the levy of said special tax, the establishment of the appropriations limit and the incurring of the bonded indebtedness were submitted to the qualified electors of the District as then known to the Secretary of the Temecula Public Financing Authority (the "Authority"), as required by the Mello-Roos Community Facilities Act of 1982, California Government Code Section 53311 et seq. (the "Law") and the election was held (the "Formation Election") and canvassed on Mamh 25, 2003; and WHEREAS, subsequent to March 25, 2003, the Authority was advised that certain parcels of land in the District had been transferred prior to March 25, 2003 to landowners that had not participated in the Formation Election; and WHEREAS, in order that all owners of land in the District as of the close of the public hearings on the formation of and issuance of debt for the District have a chance to vote for or against the formation of the District, the levy of special taxes therein, the incurrence of indebtedness by the District and the establishment of an appropriations limit for the District, this Board of Directors now desires to hold a new election on such matters (the "Ratifying Election"), as set forth in this Resolution, thereby ratifying the Formation Election. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: Section 1. Pursuant to Sections 53325.7, 53326 and 53351 of the Law, the issues of the levy of said special tax, the incurring of bonded indebtedness and the establishment of said appropriations limit shall be submitted to the qualified electors of the District at a Ratifying Election called therefor as provided below. Section 2. As authorized by Section 53353.5 of the Law, the three propositions described in paragraph 1 above shall be combined into a single ballot measure, the form of which is attached hereto as Exhibit A and by this reference incorporated herein. The form of ballot is hereby approved. Section 3. This Board of Directors hereby finds that fewer than 12 persons have been registered to vote within the territory of the District for each of the ninety (90) days preceding the close of the public hearings heretofore conducted and concluded on March 25, 2003 by this Board of Directors for the purposes of these proceedings. Accordingly, and pursuant to Section 53326(b) of the Law, this Board of Directors finds that for purposes of these proceedings the qualified electors are the landowners within the District as of March 25, 2003, and that the vote shall be by said landowners or their authorized representatives, each having one vote for each acre or portion thereof such landowner owns in the District as of the close of the public hearings. Section 4. This Board of Directors hereby calls a special Ratifying Election to consider the measure described in Section 2 above, which election shall be held immediately following adoption of this Resolution in the meeting place of the Board of Directors of the Authority. The Secretary is hereby designated as the official to conduct said election. It is hereby acknowledged that the Secretary has on file the Resolution of Formation, a map of the proposed boundaries of the District, and a sufficient description to allow the Secretary to determine the boundaries of the District. The voted ballots shall be returned to the Secretary no later than immediately following the adoption of this Resolution; and when all of the qualified voters have voted, the Ratifying Election shall be closed. Section 5. Pursuant to Section 53327 of the Law, the Ratifying Election shall be conducted by mail or hand delivered ballot pursuant to the California Elections Code. This Board of Directors hereby finds that paragraphs (a), (b), (c) (1) and (c)(3) of Section 4000 of the California Elections Code are applicable to the Ratifying Election. Section 6. This Board of Directors acknowledges that the Secretary has caused to be delivered to the qualified electors of the District ballots in the form set forth in Exhibit A hereto. Each ballot indicated the number of votes to be voted by the respective landowner. Each ballot was accompanied by all supplies and written instructions necessary for the use and return of the ballot. The envelope to be used to return ballots was enclosed with the ballot, had the return postage prepaid, and contained the following: (a) the name and address of the landowner, (b) a declaration, under penalty of perjury, stating that the voter is the owner of record or authorized representative of the landowner entitled to vote and is the person whose name appears on the envelope, (c) the printed name, signature and address of the voter, (d) the date of signing and place of execution of the declaration pursuant to clause (b) above, and (e) a notice that the envelope contains an official ballot and is to be opened only by the Secretary. Analysis and arguments with respect to the ballot measure will be waived by the landowners in the voted ballots, as permitted by Section 53327(b) of the Law. -2- Section 7. The Secretary shall accept the ballots of the qualified electors upon and prior to the adoption of this Resolution, whether the ballots be personally delivered or received by mail. The Secretary shall have available ballots which may be marked in the Board of Directors meeting room on the election day by the qualified electors. Section 8. This Board of Directors hereby further finds that the provision of the Law requiring a minimum of 90 days following the adoption of the Resolution of Formation to elapse before said special election is for the protection of the qualified electors of the District. The voted ballots of the qualified electors of the District contain an acknowledgment of a waiver of any time limit pertaining to the conduct of the election and of a waiver of any requirement for analysis and arguments in connection with the election. Accordingly, this Board of Directors finds and determines that the qualified electors have been fully apprised of and have agreed to the shortened time for the election and waiver of analysis and arguments, and have thereby been fully protected in these proceedings. This Board of Directors also finds and determines that the Secretary has concurred in the shortened time for the Ratifying Election. Section 9. Pursuant to the Local Agency Special Tax and Bond Accountability Act, Sections 50075.1 et. seq. and Sections 53410 et. seq. of the California Government Code, (a) the ballot measure referred to in Sections 2 and 4 above contains a statement indicating the specific purposes of the special tax, the proceeds of the special tax will be applied only to the purposes specified in the ballot measure, there shall be created by the Treasurer an account into which proceeds of the special tax levies will be deposited, and the Treasurer is hereby directed to provide an annual report to this Board of Directors as required by Section 50075.3 of the California Government Code; and (b) the ballot measure contains a statement indicating the specific purposes of the bonds, the proceeds of the bonds will be applied only to the purposes specified in the ballot measure, there shall be created by the Treasurer an account into which the proceeds of the bonds will be deposited, and the Treasurer is hereby directed to provide an annual report to this Board of Directors as required by Section 53411 of the California Government Code. PASSED, APPROVED AND ADOPTED, by the Board of Directors of the Temecula Public Financing Authority at a meeting held on the 13th day of May, 2003. ATTEST: Jeffrey E. Stone, Chairperson Susan W. Jones, CMC City Clerk/Authority Secretary [SEAL] -3- STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Jones, Secretary of the Temecula Public Financing Authority, HEREBY DO CERTIFY that the foregoing Resolution No, TPFA 03-~ was duly adopted at a special meeting of the Board of Directors of the Temecula Public Financing Authority on the 13th day of May, 2003, by the following vote: AYES: BOARDMEMBERS: NOES: BOARDMEMBERS: ABSENT: BOARDMEMBERS: ABSTAIN: BOARDMEMBERS: Susan W. Jones, CMC Ci~ Cler~Authori~ Secretary -4- EXHIBIT A TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) OFFICIAL BALLOT Special Ratifying Election (May 13, 2003) This ballot is for a special, landowner election. You must return this ballot in the enclosed postage paid envelope to the Secretary of the Temecula Public Financing Authority no later than immediately after adoption of the resolution of the Board of Directors calling said election, either by mail or in person. To vote, mark a cross (X) on the voting line after the word "YES" or after the word "NO". All marks otherwise made are forbidden. All distinguishing marks are forbidden and make the ballot void. If you wrongly mark, tear, or deface this ballot, return it to the Secretary of the Temecula Public Financing Authority and obtain another. BALLOT MEASURE: Shall the Temecula Public Financing Authority (the "Authority") incur an indebtedness and issue bonds in one or more series in the maximum aggregate principal amount of $25,000,000, with interest at a rate or rates not to exceed the maximum interest rate permitted by law at the time of sale of such bonds on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), the proceeds of which will be used only to finance the costs of certain public improvements and to eliminate a lien on property in the District as specified in the Resolution of Formation of the District and the costs of issuing the bonds as well as the establishment of appropriate bond and interest rate reserves; shall a special tax payable solely from lands within the District be levied annually upon lands within the District to be applied only to the payment of the principal and interest upon such bonds to be issued and to replenish the reserves for the bonds, and to pay the costs of the Authority and the City of Temecula in administering the District, and shall the annual appropriations limit of the District be established in the amount of $25,000,000? Yes: No: By execution in the space provided below, you also indicate your waiver of prior notice of and the time limit pertaining to the conduct of the election, and any requirement for analysis and arguments with respect to the ballot measure. Number of Votes: Property Owner: A-1 RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY DECLARING RESULTS OF SPECIAL RATIFYING ELECTION AND DIRECTING RECORDING OF NOTICE OF SPECIAL TAX LIEN WHEREAS, in proceedings heretofore conducted by this Board of Directors pursuant to the Mello-Roos Community Facilities Act of 1982, Section 53311 et seq; of the California Government Code (the "Law"), this Board of Directors on May 13, 2003 adopted a resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority Calling Special Ratifying Election Within Community Facilities District No. 03-1 (Crowne Hill)", calling for a special election of the qualified electors within the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") ratifying the formation of the District, the levy of special taxes therein, the incurrence of indebtedness by the District and the establishment of an appropriations limit for the District; and WHEREAS, pursuant to the terms of said resolution, which are by this reference incorporated herein, the special ratifying election was held on May 13, 2003, and the Secretary has on file a Canvass and Statement of Results of Election, a copy of which is attached hereto as Exhibit A; and WHEREAS, this Board of Directors has reviewed the canvass and hereby approves it. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: Section 1. The issues presented at the special ratifying election were the incurring of a bonded indebtedness in the maximum aggregate principal amount of $25,000,000, the levy of a special tax within the District to be levied in accordance with the rate and method of apportionment of special taxes heretofore approved by this Board of Directors by its resolution adopted March 25, 2003 entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority of Formation of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill), Authorizing Levy of a Special Tax Within the District, Preliminarily Establishing an Appropriations Limit for the District and Submitting Levy of the Special Tax and the Establishment of the Appropriations Limit to the Qualified Electors of the District", and the approval of an appropriations limit of not to exceed $25,000,000 pursuant to said resolution. Section 2. Pursuant to the canvass of the special ratifying election on file with the Secretary, the issues presented at the special election were approved by the qualified electors of the District by more than two-thirds of the votes cast at the special election. Section 3. Pursuant to the voter approval, the District is hereby declared to be fully formed with the authority to incur bonded indebtedness and to levy special taxes as heretofore provided in these proceedings and in the Law. PJ'rPFA Resos 2003/'I'PFA 03-_ 1 Section 4. The Secretary is hereby directed to execute and cause to be recorded in the office of the County Recorder of the County of Riverside an amended and restated notice of special tax lien, said recording to occur no later than fifteen days following adoption by the Board of Directors of this Resolution. Section 5. This Resolution shall take effect upon its adoption. PASSED, APPROVED AND ADOPTED, by the Board of Directors of the Temecula Public Financing Authority at a meeting held on the 13th day of May, 2003. ATTEST: Jeffrey E. Stone, Chairperson Susan W. Jones, CMC City Clerk/Authority Secretary [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Jones, Secretary of the Temecula Public Financing Authority, HEREBY DO CERTIFY that the foregoing Resolution No. TPFA 03- was duly adopted at a special meeting of the Board of Directors of the Temecula Public Financing Authority on the 13th day of May, 2003, by the following vote: AYES: BOARDMEMBERS: NOES: BOARDMEMBERS: ABSENT: BOARDMEMBERS: ABSTAIN: BOARDMEMBERS: Susan W. Jones, CMC City Clerk/Authority Secretary R:/TPFA Resos 2003rFPFA 03-~ 2 EXHIBIT A CANVASS AND STATEMENT OF RESULT OF ELECTION TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) I hereby certify that on May 13, 2003, I canvassed the returns of the special ratifying election held on May 13, 2003, in the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) and the total number of ballots cast in said District and the total number of votes cast for and against the measure are as follows and the totals as shown for and against the measure are full, true and correct: Qualified Landowner Votes Votes Cast YES NO Temecula Public Financing Authority Community Facilities District No. 03- 1 (Crowne Hill) Special Ratifying Election May 13, 2003. BALLOT MEASURE: Shall the Temecula Public Financing Authority (the "Authority") incur an indebtedness and issue bonds in one or more series in the maximum aggregate principal amount of $25,000,000, with interest at a rate or rates not to exceed the maximum interest rate permitted by law at the time of sale of such bonds on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), the proceeds of which will be used only to finance the costs of certain public improvements and to eliminate a lien on property in the District as specified in the Resolution of Formation of the District and the costs of issuing the bonds as well as the establishment of appropriate bond and interest rate reserves; shall a special tax payable solely from lands within the District be levied annually upon lands within the District to be applied only to the payment of the principal and interest upon such bonds to be issued and to replenish the reserves for the bonds and to pay the costs of the Authority and the City of Temecula in administering the District, and shall the annual appropriations limit of the District be established in the amount of $25,000,000? IN WITNESS WHEREOF, I HAVE HEREUNTO SET MY HAND this 13th day of May, 2003. By: Secretary, Temecula Public Financing Authority A-1 RESOLUTION NO. TPFA 03- A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY AUTHORIZING THE ISSUANCE OF SPECIAL TAX BONDS OF THE TEMECULA PUBLIC FINANCING AUTHORITY FOR TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL), APPROVING AND DIRECTING THE EXECUTION OF A FISCAL AGENT AGREEMENT AND APPROVING OTHER RELATED DOCUMENTS AND ACTIONS WHEREAS, this Board of Directors has conducted proceedings under and pursuant to the Mello-Roos Community Facilities Act of 1982 (the "Law"), to form the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), to authorize the levy of special taxes upon the land within the District, and to issue bonds secured by the special taxes the proceeds of which are to be used to finance certain public improvements (the "Facilities") and the elimination of a prior lien (the "Prior Lien"), all as described in the Resolutions entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority of Formation of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Authorizing the Levy of a Special Tax Within the District, Preliminarily Establishing an Appropriations Limit for the District and Submitting Levy of the Special Tax and the Establishment of the Appropriations Limit to the Qualified Electors of the District" and "A Resolution of the Board of Directors of the Temecula Public Financing Authority Determining the Necessity to Incur Bonded Indebtedness Within Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) and Submitting Proposition to the Qualified Electors of the District," which Resolutions were adopted by this Board of Directors on March 25, 2003; and WHEREAS, pursuant to said resolutions, an election was held within the District on March 25, 2003 and the qualified electors approved the propositions of the incurrence of the bonded debt, the establishment of the appropriations limit and the levy of the special tax by more than two-thirds of the votes cast at said special election; and WHEREAS, there have been submitted to this Board of Directors for its approval a Fiscal Agent Agreement (the "Fiscal Agent Agreement") providing for the issuance of the Bonds (as defined in Section 1 below) and the use of the proceeds of the Bonds to finance the Facilities and to eliminate the Prior Lien, as well as a Preliminary Official Statement (the "Preliminary Official Statement") describing the Bonds, a bond purchase agreement to be used in connection with the sale of the Bonds (the "Purchase Contract") and a Continuing Disclosure Agreement relating to the Bonds (the "Continuing Disclosure Agreement"), and this Board of Directors, with the aid of Authority staff, has reviewed said documents and found them to be in proper order; 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 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 Law. R:/TPFA Resos 2003/TPFA 03-__ 1 NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: Section 1. Pursuant to the Law, this Resolution and the Fiscal Agent Agreement, special tax bonds of the Temecula Public Financing Authority (the "Authority") for the District (the "Bonds") in an aggregate principal amount not to exceed $25,000,000 are hereby authorized to be issued, such bonds to be designated the "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds." The Bonds shall be executed in the form set forth in and otherwise as provided in the Fiscal Agent Agreement. The Board of Directors hereby finds and determines that the Bonds, based on the appraisal of Stephen G. White, MAI, dated March 19, 2003, have in excess of a one to three lien to value ratio as required by the Authority's Local Goals and Policies for Community Facilities Districts, adopted by the Board of Directors on April 10, 2001 (the "Local Goals and Policies"). The Board of Directors finds that the Bonds, when issued pursuant to the Fiscal Agent Agreement, will be in accordance with the Local Goals and Policies. The Board of Directors further finds that the sale of the Bonds at negotiated sale as contemplated by the Purchase Contract will result in a lower overall cost. Section 2. The Fiscal Agent Agreement with respect to the Bonds, in the form presented to this Board of Directors at this meeting, is hereby approved. The Executive Director is hereby authorized and directed to execute and deliver the Fiscal Agent Agreement in said form, with such additions thereto or changes therein as are approved by the Executive Director upon consultation with the Authority's General Counsel and Bond Counsel, the approval of such additions or changes to be conclusively evidenced by the execution and delivery of the Fiscal Agent Agreement by the Executive Director. The date, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of redemption and other terms of the Bonds shall be as provided in the Fiscal Agent Agreement as finally executed. Section 3. The Purchase Contract between the Authority and Stone & Youngberg LLC (the "Underwriter"), in the form presented to the Board of Directors at this meeting, is hereby approved. The Executive Director is hereby authorized and directed to accept the offer of the Underwriter to purchase the Bonds contained in the Purchase Contract (provided that the aggregate principal amount of the Bonds sold thereby is not in excess of $25,000,000, the true interest cost of the Bonds is not in excess of 7.00% and the underwriter's discount is not in excess of 2.25% of the aggregate principal amount of the Bonds) and to execute and deliver the Purchase Contract in said form, with such additions thereto or changes therein as are recommended or approved by such officer upon consultation with the Authority's General Counsel and Bond Counsel, the approval of such additions or changes to be conclusively evidenced by the execution and delivery of the Purchase Contract by the Executive Director. Section 4. The Preliminary Official Statement, in the form presented to the Board of Directors at this meeting, is hereby approved. The Executive Director is hereby authorized and directed, for and in the name and on behalf of the Authority, to make changes to the Preliminary Official Statement prior to its dissemination to prospective investors, and to bring the Preliminary Official Statement into the form of a final official statement (the "Official Statement") including such additions thereto or changes therein as are recommended or approved by such officer upon consultation with Authority's General Counsel and Disclosure Counsel. The Executive Director is hereby authorized and directed to execute and deliver the Official Statement. The Underwriter is hereby authorized to distribute copies of the Preliminary Official R/TPFA Resos 2003FFPFA 02-~ 2 Statement to persons who may be interested in the purchase of the Bonds and is directed to deliver copies of the Official Statement to all actual purchasers of the Bonds. The Executive Director is hereby authorized to execute a certificate or certificates to the effect that the Official Statement and the Preliminary Official Statement were deemed "final" as of their respective dates for purposes of Rule 15c2-12 of the Securities Exchange Act of 1934, and is authorized to so deem such statements final. Section 5. The Continuing Disclosure Agreement related to the Bonds, in the form presented to the Board of Directors at this meeting, is hereby approved. The Executive Director is hereby authorized and directed, for and in the name of and on behalf of the Authority, to execute and deliver the Continuing Disclosure Agreement in said form, with such additions thereto or changes therein as are deemed necessary, desirable or appropriate by the Executive Director upon consultation with the Authority's General Counsel and Disclosure Counsel, the approval of such changes to be conclusively evidenced by the execution and delivery by the Executive Director of the Continuing Disclosure Agreement. Section 6. The Authority hereby covenants, for the benefit of the Bondowners, to commence and diligently pursue to completion any foreclosure action regarding delinquent installments of any amount levied as a special tax for the payment of interest or principal of the Bonds, said foreclosure action to be commenced and pursued as more completely set forth in the Indenture. Section 7. The Bonds, when executed, shall be delivered to the Fiscal Agent for authentication. The Fiscal Agent (as defined in the Fiscal Agent Agreement) is hereby requested and directed to authenticate the Bonds by executing the Fiscal Agent's certificate of authentication and registration appearing thereon, and to deliver the Bonds, when duly executed and authenticated, to the Underwriter in accordance with written instructions executed on behalf of the Authority by the Executive Director, which instructions such officer is hereby authorized and directed, for and in the name and on behalf of the Authority, to execute and deliver to the Fiscal Agent. Such instructions shall provide for the delivery of the Bonds to the Underwriter upon payment of the purchase price therefor. Section 8. All actions heretofore taken by the officers and agents of the Authority with respect to the establishment of the District and the sale and issuance of the Bonds are hereby approved, confirmed and ratified, and the proper officers of the Authority are hereby authorized and directed to do any and all things and take any and ail actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful issuance and delivery of the Bonds in accordance with this Resolution, and any certificate, agreement, and other document described in the documents herein approved. Whenever in this Resolution any officer of the Authority is authorized to execute or countersign any document or take any action, such execution, countersigning or action may be taken on behalf of such officer by any person designated by such officer to act on his or her behalf in the case such officer shall be absent or unavailable. PJTPFA Resos 2003/'rPFA 02-__ 3 Section 9. This Resolution shall take effect upon its adoption. PASSED, APPROVED AND ADOPTED, by the Board of Directors of the Temecula Public Financing Authority at a meeting held on the 13th day of May, 2003. ATTEST: Jeffrey E. Stone, Chairperson Susan W. Jones, CMC City Clerk/Authority Secretary [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Jones, Secretary of the Temecula Public Financing Authority, HEREBY DO CERTIFY that the foregoing Resolution No. TPFA 03- was duly adopted at a special meeting of the Board of Directors of the Temecula Public Fin'~ncing Authority on the 13th day of May, 2003, by the following vote: AYES: BOARDMEMBERS: NOES: BOARDMEMBERS: ABSENT: BOARDMEMBERS: ABSTAIN: BOARDMEMBERS: Susan W. Jones, CMC City Clerk/Authority Secretary PJTPFA Resos 2003/TPFA 02-~ 4 Quint & Thimmig LLP 5/6/03 RECORDING REQUESTED BY AND AFTER RECORDATION RETURN TO: Secretary Temecula Public Financing Authority 43200 Business Park Drive Temecula, CA 92590 AMENDED AND RESTATED NOTICE OF SPECIAL TAX LIEN Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Pursuant to the requirements of Section 3114.5 of the California Streets and Highways Code and Section 53311 et seq, of the California Government Code (the "Act"), a Notice of Special Tax Lien (the "Notice") with respect to the Temecula Public Financing Authority Community Facilities District No, 03-1 (Crowne Hill) (the "District") was recorded in the Office of the County Recorder of the County of Riverside on , 2003, as Document No. · This Amended and Restated Notice of Special Tax Lien amends and restates the Notice in full. Pursuant to the requirements of Section 3114.5 of the California Streets and Highways Code and Section 53311 et seq. of the California Government Code, the undersigned Secretary of the Temecula Public Financing Authority (the "Authority"), County of Riverside, State of California, hereby gives notice that a lien to secure payment of a special tax which the Board of Directors of the Authority authorized, is hereby imposed. The special tax secured by this lien is authorized to be levied for the purpose of paying principal and interest on bonds, the proceeds of which are being used to finance the costs of certain public improvements, and costs to eliminate a prior lien, all as described on Exhibit A attached hereto and hereby made a part hereof. The special tax is authorized to be levied within the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) which has now been officially formed and the lien of the special tax is a continuing lien which shall secure each annual levy of the special tax and which shall continue in force and effect until the special tax obligation is permanently satisfied and cancelled in accordance with law or until the special tax ceases to be levied and a notice of cessation of special tax is recorded in accordance with Section 53330.5 of the Government Code. The rate, method of apportionment, and manner of collection of the authorized special tax is as set forth in Exhibit B attached hereto and hereby made a part hereof. Conditions under which the obligation to pay the special tax may be prepaid in part and permanently satisfied in part are as provided in Exhibit B hereto. Notice is further given that upon the recording of this notice in the office of the County Recorder, the obligation to pay the special tax levy shall become a lien upon all nonexempt real property within the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) in accordance with Section 3115.5 of the California Streets and Highways Code. 20009.04~6724 The name(s) of the owner(s) of the real property included within the area of this community facilities district and the assessor's tax parcel(s) numbers of all parcels or any portion thereof which are included within the area of this community facilities district, in each case which are not exempt from the special tax and as they appear on the latest secured assessment roll as of the date of recording of this or as otherwise known to the Authority, are as set forth in Exhibit C attached hereto and hereby made a part hereof. Reference is made to the boundary map of the community facilities district recorded on January 31, 2003 at 8:00 a.m. in Book 52 of Maps of Assessment and Community Facilities Districts at Page 79 (instrument no. 2003-072701), in the office of the County Recorder for the County of Riverside, State of California, which map is now the final boundary map of the community facilities district. For further information concerning the current and estimated future tax liability of owners or purchasers of real property subject to this special tax lien, interested persons should contact the Treasurer of the Temecula Public Financing Authority, Temecula Public Financing Authority, 43200 Business Park Drive, Temecula, CA 92590, telephone number (909) 694-6430. Dated: ,2003 By: Secretary, Temecula Public Financing Authority -2- EXHIBIT A TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) DESCRIPTION OF FACILITIES ELIGIBLE TO BE FUNDED BY THE DISTRICT AND PRIOR LIEN TO BE ELIMINATED BY THE DISTRICT FACILITIES The CFD may finance all or a portion of the costs of the following: 1. Traffic Signal Improvements; including design engineering, survey, construction staking, soils engineering, construction management, traffic signal interconnect, City encroachment permits, inspection and plan check fees. Locations are as described below. · De Portola Road & Butterfield Stage Road intersection · Crowne Hill Drive & Butterfield Stage Road intersection · Royal Crest Place & Butterfield Stage Road intersection · Pauba Road & Butterfield Stage Road intersection 2. Street Improvements; including design engineering, survey, construction staking, soils engineering, rough grading & erosion control, construction management, City encroachment permits, inspection and plan check fees, and including any additional improvements described below. Butterrield Stage Road; easterly side improvements from the northerly boundary line of Tract No. 23143-3 north to Pauba Road. Additional improvements include concrete sidewalks, concrete curb & gutter, asphalt pavement, paint striping markers & signs. Crowne Hill Drive; full width improvements from the northerly boundary line of Tract No. 23143-3 north to Pauba Road. Additional improvements include concrete sidewalks, concrete curb & gutter, asphalt pavement, paint striping, markers & signs. Royal Crest Place; full width improvements from Butterfield Stage Road easterly to Crowne Hill Drive. Additional improvements include concrete sidewalks, concrete curb & gutter, asphalt pavement, paint striping, markers & signs. Pauba Road; southerly side improvements from Butterfield Stage Road easterly to Via Del Monte. Additional improvements include concrete sidewalks, concrete curb & gutter, asphalt pavement, paint striping, markers & signs. 3. Storm Drain Improvements; including design engineering, survey, construction staking, soils engineering, erosion control, construction management, City inspection and plan check fees, and including any additional improvements described below. Royal Crest Place; improvements as shown on the Assessment District No. 159 Storm Drain plans (with the exception of Line H 42" RCP & 48" RCP Sta. 12+47 to Sta. 18+96 portion to be maintained by RCFCD). Additional improvements include main lines, laterals, catch basins, junction & transition structures, manholes and other related facilities. 4. Park Site improvements; including design engineering, survey, construction staking, soils engineering, landscape architecture, construction management, land acquisition costs, City inspection and plan check fees, and including any additional improvements described below. Park Site "A" Tract No. 23143 final Lot 104; Additional improvements include parking area improvements, tot lot with play equipment, picnic tables, covered picnic shelter, restroom facility, half court basketball, meandering pathway with bench seating, useable turf area, landscaping & irrigation, security lighting and other related facilities. 5. Dry Utility Improvements; including design engineering, utility consultant, survey, construction staking, soils engineering, construction management, Utility Agency fees, and including any additional improvements described below. Butterrield Stage Road; easterly side improvements from the northerly boundary line of Tract No. 23143-3 north to Pauba Road. Additional improvements include streetlights, electric power backbone system and other related facilities. Crowne Hill Drive; from the northerly boundary line of Tract No. 23143-3 north to Pauba Road. Additional improvements include street lights, electric power backbone system, telephone backbone system, gas main distribution system, CATV and other related facilities. Royal Crest Place; from Butterfield Stage Road easterly to Crowne Hill Drive. Additional improvements include street lights, electric power backbone system, telephone backbone system, gas main distribution system CATV and other related facilities. Pauba Road; southerly side improvements from Butterfield Stage Road easterly to Via Del Monte. Additional improvements include street lights, electric power backbone system, telephone backbone system, gas main distribution system CATV and other related facilities. 6. Wet Utility Improvements; sanitary sewer & domestic water system improvements including design engineering, survey, construction staking, soils engineering, construction management, City encroachment permit, Rancho California Water District and Eastern Municipal Water District inspection and plan check fees, and including any additional improvements described below. Butterrield Stage Road; improvements at the intersection of Royal Crest Place. Additional improvements include pavement removal, replacement and traffic control and related items. ^-2 Royal Crest Place; from the Crowne Hill Drive connection westerly to Butterfield Stage Road. Additional improvements include sanitary sewer & domestic water system improvements and related items. Crowne Hill Drive; from Pauba Road southerly to the connection of the existing sewer at the northerly boundary of Tract No. 23143-3 (with respect to sewer system improvements); and from the connection to the existing water line installed as Phase 1 near the intersection of Paraguay Road northerly to the connection at Pauba Road (with respect to water system improvements). Additional improvements include sanitary sewer & domestic water system improvements and related items. Pauba Road, from Butterfield Stage Road easterly to Via Del Monte. Additional improvements include domestic water system improvements and related items. 7. Street Systems Improvements; costs of construction of Butterfield Stage Road, including but not limited to preliminary engineering and design costs; environmental clearance and permitting costs; right-of-way costs; the cost for preparation of final plans, specifications and estimates; as well as construction costs of the improvements. 8. City Facilities; improvements to the City Hall complex, including but not limited to: preliminary engineering and design costs; environmental clearance and permitting costs; additional property acquisition costs; the cost for preparation of final plans, specifications and estimates; as well as construction costs of the improvements. 9. Fire Protection Facilities; the Wolf Valley Rd. Fire Station, including, but not limited to: preliminary engineering and design costs; environmental clearance and permitting costs; property acquisition costs; utility costs; the cost for preparation of final plans, specifications and estimates; as well as fire station construction costs. 10. Libraries; a City library, currently proposed on Pauba Rd. (but may be constructed at another suitable location in the City), including, but are not limited to: preliminary engineering and design costs; environmental clearance and permitting costs; property acquisition costs; utility costs; the cost for preparation of final plans, specifications and estimates; as well as library construction costs, including necessary frontage improvements on Pauba Rd. 11. State Route 79 (SR-79) Improvements; all work required to complete proposed facility upgrades and enhancements along the SR-79 corridor. Improvements include but are not limited to: roadway improvements including roadway realignments, widenings, and rehabilitation; storm drain improvements; intersection improvements; traffic signal modifications; raised medians including landscaping and irrigation systems; striping and signage modifications; parkway improvements including sidewalks, parkway landscaping and irrigation and utility relocations. The work necessary to facilitate the described SR-79 improvements includes but is not limited to preliminary engineering, right-of-way engineering and acquisition, environmental clearance and permit processing, design engineering, and construction management and permitting. 12. Interstate 15 (I-15)/State Route 79 (SR-79) Interchange Improvements; all work required to complete interchange upgrades and enhancements. Interchange improvements include but are not limited to: on-ramp and off-ramp modifications including realignments, widenings; traffic signal modifications; new freeway or ramp bridges, bridge replacement or widening; retaining walls; storm drain improvements; striping and signage modifications; A-$ parkway improvements including sidewalks, parkway landscaping and irrigation and utility relocations. The work necessary to facilitate the described interchange improvements includes but is not limited to preliminary engineering, right-of-way engineering and acquisition, environmental clearance and permit processing, design engineering, and construction management and permitting. 13. Water system and/or sewer system improvements to be designated by the Rancho California Water District on which it will expend $1,341,260 of bond funds. 14. Sanitary sewer system and water system improvements to be designated by the Eastern Municipal Water District on which it will expend $2,575,856 of bond funds. PRIOR LIEN The CFD may fund amounts necessary to eliminate all or a portion of the lien imposed by the County of Riverside Assessment District No. 159 on the real property within the CFD. OTHER The CFD may also finance any of the following: 1. Bond related expenses, including underwriter's discount, reserve fund, capitalized interest, bond and disclosure counsel and all other incidental expenses. 2. Administrative fees of the Authority, the City of Temecula and the bond trustee or fiscal agent related to the CFD and any bonded indebtedness of the CFD. 3. Reimbursement of costs related to the formation of the CFD advanced by the Authority, the City or any related entity, or any landowner or developer within the CFD, as well as reimbursement of any costs advanced by the Authority or any related entity, or any landowner or developer within the CFD, for facilities, fees or other purposes or costs of the CFD. EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX A Special Tax shall be levied and collected on all Taxable Property located within the boundaries of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) ("CFD"). The amount of Special Tax to be levied in each Fiscal Year, commencing in Fiscal Year 2003-04 on a Parcel shall be determined by the Board of Directors of the Temecula Public Financing Authority or its designee, acting in its capacity as the legislative body of the CFD by applying the appropriate Special Tax as set forth in Sections B., C., and D., below. All of the real property within the CFD, unless exempted by law or by the provisions in Section E., shall be taxed for the purposes, to the extent and in the manner herein provided. A. DEFINITIONS The terms hereinafter set forth have the following meanings: "Acre or Acreage" means the land area of a Parcel as shown on an Assessor's Parcel Map, or if the land area is not shown on an Assessor's Parcel Map, the land area shown on the applicable final map, parcel map, condominium plan, or other similar recorded County instrument. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1 of Division 2 of Title 5 of the California Government Code of the State of California. "Administrative Expenses" the actual or reasonably estimated costs directly related to the administration of the CFD, including but not limited to: the costs of computing the Special Taxes and of preparing the annual Special Tax collection schedules (whether by the CFD Administrator or designee thereof or both); the costs of collecting the Special Taxes (whether by the Authority, County, City, or otherwise); the costs of remitting the Special Taxes to the trustee for any Bonds; the costs of commencing and pursuing to completion any foreclosure action arising from delinquent Special Taxes; the costs of the trustee (including its legal counsel) in the discharge of the duties required of it under any Indenture; the costs of the Authority, City or designee in complying with arbitrage rebate and disclosure requirements of applicable federal and State securities laws, the Act and the California Government Code, including property owner inquiries regarding the Special Taxes; the costs associated with the release of funds from any escrow account; the costs of the Authority, City or designee related to an appeal of the Special Tax; and an allocable share of the salaries of the City staff and City overhead expense directly relating to the foregoing. Administrative Expenses shall also include amounts advanced by the City or the Authority for any administrative purposes of the CFD. "Approved Property" means for any Fiscal Year, all Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January 1st preceding the Fiscal Year in which the Special Tax is being levied, and (ii) for which a building permit was not issued prior to the April 1st preceding the Fiscal Year in which the Special Tax is being levied. "Assessor's Parcel Map" means an official map of the County designating parcels by a parcel number. "Assigned Special Tax" means the Special Tax for each Land Use Category of Developed Property, as determined in accordance with Section C. 1 .a., below. "Authority" means the Temecula Public Financing Authority. "Backup Special Tax" means the Special Tax amount set forth in Section C.1 .b. below. "Board of Directors" means the Board of Directors of the Authority, acting as the legislative body of the CFD. "Bonds" means any bonds or other indebtedness (as defined in the Act) issued by the CFD and secured by the levy of Special Taxes. "CFD" means Community Facilities District No. 03-1 (Crowne Hill) of the Authority established pursuant to the Act. "CFD Administrator" means the Finance Director of the City, or designee thereof, responsible for determining the Special Tax Requirement and various other amounts described herein and for providing for the levy and collection of the Special Taxes. "City" means the City of Temecula. "County" means the County of Riverside. "Developed Property" means all Parcels of Taxable Property, not classified as Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that are not Exempt Property pursuant to the provisions of Section E., below: (i) that are included in a Final Map that was recorded prior to January 1st preceding the Fiscal Year in which the Special Tax is being levied and (ii) a building permit for new construction has been issued prior to April 1st preceding the Fiscal Year in which the Special Tax is being levied. "Exempt Property" means any Parcel, which is exempt from Special Taxes pursuant to Section E., below. "Final Map" means a subdivision of property evidenced by the recordation of a final map, parcel map, or lot line adjustment, pursuant to the Subdivision Map Act (California Government Code Section 66410 et seq.) or the recordation of a condominium plan pursuant to California Civil Code 1352 that creates individual lots for which building permits may be issued without further subdivision. "Fiscal Year" means the period starting on July 1st and ending on the following June 30th "Indenture" means the indenture, trust agreement, fiscal agent agreement, resolution or other instrument pursuant to which Bonds are issued, as modified, amended and/or supplemented from time to time, and any instrument replacing or supplementing the same. "Land Use Category" means any of the categories listed in Tables I and 2. B-2 "Maximum Special Tax" means the Maximum Special Tax, determined in accordance with Section C, which can be levied in any Fiscal Year on any Parcel. "Multifamily Residential Property" means any Parcel of Residential Property that consists of a building or buildings comprised of attached residential units available for rental but not purchase, by the general public and under common management. "Non-Residential Property" means all Parcels of Developed Property for which a building permit was issued for any type of non-residential use. "Parcel(s)" means a lot or parcel shown on an Assessor's Parcel Map with an assigned parcel number as of January 1st preceding the Fiscal Year for which the Special Tax is being levied. "Property Owner's Association Property" means any property within the boundary of the CFD, which, as of January 1st of the preceding Fiscal Year for which the Special Tax is being levied has been conveyed, dedicated to, or irrevocably dedicated to a property owner association, including any master or sub-association. "Proportionately" means for Developed Property that the ratio of the actual Special Tax levy to the Assigned Special Tax or Backup Special Tax is the same for all Parcels of Developed Property and for Undeveloped Property, Public Property and/or Property Owners Association Property that is not Exempt Property pursuant to Section E., for each applicable Zone, that the ratio of the actual Special Tax levy per Acre to the Maximum Special Tax per Acre is the same for all such Parcels within each applicable Zone. "Public Property" means any property within the boundary of the CFD which, as of January 1st of the preceding Fiscal Year for which the Special Tax is being levied is used for rights-of-way or any other purpose and is owned by, dedicated to, or irrevocably offered for dedication to the federal government, the State of California, the County, City or any other local jurisdiction, provided, however, that any property leased by a public agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use. "Residential Floor Area" means all of the square footage within the perimeter of a residential structure, not including any carport, walkway, garage, overhang, patio, enclosed patio, or similar area. The determination of Residential Floor Area shall be made by the CFD Administrator with reference to the building permit(s) issued for such Assessor's Parcel or other appropriate means selected by the CFD Administrator. Once such determination has been made for a parcel, it shall remain fixed in all future Fiscal Years. "Residential Property" means all Parcels of Developed Property for which a building permit has been issued for purposes of constructing one or more residential dwelling units. "Special Tax(es)" means the special tax to be levied in each Fiscal Year on each Parcel of Taxable Property. "Special Tax Requirement" means that amount required in any Fiscal Year to pay: (i) annual debt service on all outstanding Bonds due in the calendar year which commences in such Fiscal Year; (ii) periodic costs on the Bonds, including but not limited to, credit enhancement and rebate payments on the Bonds; (iii) Administrative Expenses; (iv) an amount equal to any anticipated shortfall due to Special Tax delinquency in the prior Fiscal Year; and B-$ (v) any amounts required to establish or replenish any reserve funds for the outstanding Bonds; less (vi) a credit for funds available to reduce the annual Special Tax levy as determined pursuant to the Indenture. "Taxable Property" means all Parcels in the CFD which have not prepaid pursuant to Section H, or are not exempt from the Special Tax pursuant to law or Section E., below. "Undeveloped Property" means all Taxable Property not classified as Developed Property, Approved Property, Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E. "Zone(s)" means Zone 1 or Zone 2 as geographically identified on the boundary map of the CFD, attached as Exhibit 1. "Zone 1" means the specific area identified on the boundary map attached as Exhibit 1 as Zone 1 of the CFD. "Zone 2" means the specific area identified on the boundary map attached as Exhibit 1 as Zone 2 of the CFD. B. ASSIGNMENT TO LAND USE CATEGORY Each Fiscal Year, commencing with the 2003-2004 Fiscal Year, all Parcels of Taxable Property within the CFD of each applicable Zone shall be classified as either Developed Property, Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions in Section E., and shall be subject to the levy of Special Taxes in accordance with this Rate and Method of Apportionment as determined pursuant to Sections C., and D., below. Parcels of Developed Property shall further be classified as Residential Property or Non- Residential Property. A Parcel of Residential Property shall further be classified to its appropriate Land Use Category based on the Residential Floor Area of such Parcel unless it qualifies as Multifamily Residential Property, for which the Assigned Special Tax shall be based on the number of dwelling units. C. MAXIMUM SPECIAL TAX RATE 1. Developed Property The Maximum Special Tax for each Parcel of Residential Property within its applicable Zone shall be the greater of: (i) the applicable Assigned Special Tax described in Tables 1 or 2, or (ii) the amount derived by application of the Backup Special Tax. The Maximum Special Tax for each Parcel of Non-Residential Property shall be the Assigned Special Tax described in Tables 1 or 2. a. Assiqned Special Tax The Assigned Special Tax for each Parcel of Developed Property is shown in Tables 1 or 2. TABLE 1 ASSIGNED SPECIAL TAXES FOR DEVELOPED PROPERTY WITHIN ZONE 1 Assigned Special Tax Taxabl Per Land Use Category e Unit Residential Floor Area Taxable Unit A - Residential Property D/U 4,300 or more sq. ft. $5,136 B - Residential Property D/U 3,700 or more, but less than 4,300 $2,457 sq. ft. C - Residential Property D/U 3,200 or more, but less than 3,700 $2,258 sq. ft. D- Residential Property D/U 2,900 or more, but less than 3,200 $1,754 sq. ft. E- Residential Property D/U 2,600 or more, but less than 2,900 $1,594 sq. ft. F- Residential Property D/U 2,300 or more, but less than 2,600 $1,442 sq. ft. G - Residential Property D/U 2,000 or more, but less than 2,300 $1,427 sq. ft. H - Residential Property D/U Less than 2,000 sq. ft. $1,363 I Multifamily Residential Unit N/A $308 Property J - Non-Residential Property Acre N/A $5,547 B-5 TABLE 2 ASSIGNED SPECIAL TAXES FOR DEVELOPED PROPERTY WITHIN ZONE 2 Assigned Special Taxabl Tax Per Land Use Category e Unit Residential Floor Area Taxable Unit A - Residential Property D/U 3,300 or more sq. ft. $1,927 B - Residential Property D/U 2,800 or more, but less than 3,300 sq. $1,824 ft. C - Residential Property D/U 2,500 or more, but less than 2,800 sq. $1,539 ft. D - Residential Property D/U 2,300 or more, but less than 2,500 sq. $1,504 ft. E - Residential Property D/U 2,100 or more, but less than 2,300 sq. $1,436 ff. F- Residential Property D/U Less than 2,100 sq. ft. $1,316 G - Multifamily Residential Unit N/A $473 Property H - Non-Residential Property Acre N/A $8,519 b. Backup Special Tax Zone 1 The Backup Special Tax shall be $5,547 per Acre for Parcels of Residential Properly. Zone 2 The Backup Special Tax shall be $8,519 per Acre for Parcels of Residential Property. Notwithstanding the foregoing, if parcels of Residential Property are subsequently changed or modified by recordation of a lot line adjustment or similar instrument, then the Backup Special Tax shall be recalculated. 2. Approved Property The Maximum Special Tax for each Parcel of Approved Property within Zone 1 shall be $5,547 per Acre and the Maximum Special Tax for each Parcel of Approved Property within Zone 2 shall be $8,519 per Acre. 3. Undeveloped Property The Maximum Special Tax for each Parcel of Undeveloped Property within Zone 1 shall be $5,547 per Acre and the Maximum Special Tax for each Parcel of Undeveloped Property within Zone 2 shall be $8,519 per Acre. 4. Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E. The Maximum Special Tax for each Parcel of Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E., within Zone 1 shall be $5,547 per Acre and the Maximum Special Tax for each Parcel of Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E., within Zone 2 shall be $8,519 per Acre. D. METHOD OF APPORTIONMENT OF THE SPECIAL TAX Commencing with Fiscal Year 2003-2004 and for each following Fiscal Year, the Board of Directors shall levy the Special Tax on all Taxable Property until the amount of Special Taxes equals the Special Tax Requirement in accordance with the following steps: First: The Special Tax shall be levied Proportionately on each Parcel of Developed Property at up to 100% of the applicable Assigned Special Tax rate in Tables 1 or 2 as needed to satisfy the Special Tax Requirement; Second: If additional moneys are needed to satisfy the Special Tax Requirement after the first step has been completed, the Special Tax shall be levied Proportionately on each Parcel of Approved Property at up to 100% of the Maximum Special Tax for Approved Property; Third: If additional moneys are needed to satisfy the Special Tax Requirement after the first two steps have been completed, the Special Tax shall be levied Proportionately on each Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax for Undeveloped Property; Fourth: If additional moneys are needed to satisfy the Special Tax Requirement after the first three steps have been completed, the Special Tax to be levied on each Parcel of Developed Property whose Maximum Special Tax is derived by the application of the Backup Special Tax shall be increased Proportionately from the Assigned Special Tax up to the Maximum Special Tax for each such Parcel; Fifth: If additional moneys are needed to satisfy the Special Tax Requirement after the first four steps have been completed, the Special Tax shall be levied Proportionately on each Parcel of Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to the provisions of Section E., at up to 100% of the Maximum Special Tax. Notwithstanding the above, under no circumstances will the Special Taxes levied against any Parcel of Residential Property be increased by more than ten percent (10%) per Fiscal Year as a consequence of delinquency or default by the owner of any other Parcel within the CFD. E. EXEMPTIONS 1. Zone 1 Special Taxes shall not be levied on up to 93.41 Acres of Public Property and/or Property Owner's Association Property within Zone 1 of the CFD. The CFD Administrator will assign Exempt Property status in the chronological order in which property becomes Public Property and/or Property Owner's Association Property within Zone 1. B-7 After the limit of 93.41 Acres within Zone 1 of the CFD has been reached, the Maximum Special Tax obligation for any additional Public Property and/or Property Owner's Association Property shall be prepaid in full pursuant to Section H., prior to the transfer or dedication of such property. Until the Maximum Special Tax obligation is prepaid as provided for in the preceding sentence, the Public Property and/or Property Owner's Association Property within the CFD shall be subject to the levy of the Special Tax as provided for in the fifth step in Section D. 2. Zone 2 Special Taxes shall not be levied on up to 30.43 Acres of Public Property and/or Property Owner's Association Property within Zone 2 of the CFD. The CFD Administrator will assign Exempt Property status in the chronological order in which property becomes Public Property and/or Property Owner's Association Property within Zone 2. After the limit of 30.43 Acres within Zone 2 of the CFD has been reached, the Maximum Special Tax obligation for any additional Public Property and/or Property Owner's Association Property shall be prepaid in full pursuant to Section H., prior to the transfer or dedication of such property. Until the Maximum Special Tax obligation is prepaid as provided for in the preceding sentence, the Public Property and/or Property Owner's Association Property within the CFD shall be subject to the levy of the Special Tax as provided for in the fifth step in Section D. F. MANNER OF COLLECTION The Special Tax shall be collected in the same manner and at the same time as ordinary ad valorem property taxes and shall be subject to the same penalties, the same procedure, sale and lien priority in the case of delinquency; provided, however, that the CFD Administrator may directly bill the Special Tax, may collect Special Taxes at a different time or in a different manner if necessary to meet its financial obligations, and may covenant to foreclose and may actually foreclose on Parcels having delinquent Special Taxes as permitted by the Act if necessary to meet the financial obligations of the CFD. G. REVIEW AND APPEAL Any taxpayer may file a written appeal of the Special Tax levied on his/her property with the CFD Administrator, provided that the appellant is current in his/her payments of Special Taxes. During the pendency of an appeal, all Special Taxes previously levied must be paid on or before the payment date established when the levy was made. The appeal must specify the reasons why the appellant claims the Special Tax is in error. The CFD Administrator shall review the appeal, meet with the appellant if the CFD Administrator deems necessary, and advise the appellant of its determination. If the CFD Administrator agrees with the appellant, the CFD Administrator shall grant a credit to eliminate or reduce future Special Taxes on the appellant's property. No refunds of previously paid Special Taxes shall be made. H. PREPAYMENT OF SPECIAL TAX The following definitions apply to this Section H: "CFD Public Facilities" means $16,500,000 expressed in 2002 dollars, which shall increase by the Construction Inflation Index on July 1, 2003, and on each July 1 thereafter, or such lower number as (i) shall be determined by the CFD Administrator as sufficient to provide B-$ the public facilities under the authorized bonding program of the CFD, or (ii) shall be determined by the Board of Directors concurrently with a covenant that it will not issue any more Bonds to be supported by Special Taxes levied under this Rate and Method of Apportionment. "Construction Fund" means an account specifically identified in the Indenture to hold funds that are currently available for expenditure to acquire or construct public facilities eligible under the Act. "Construction Inflation Index" means the annual percentage change in the Engineering News-Record Building Cost Index for the City of Los Angeles, measured as of the calendar year, which ends in the previous Fiscal Year. In the event this index ceases to be published, the Construction Inflation Index shall be another index as determined by the CFD Administrator that is reasonably comparable to the Engineering New-Record Building Cost Index for the City of Los Angeles. "Future Facilities Costs" means the CFD Public Facilities minus public facility costs available to be funded through existing construction escrow accounts or funded by the Bonds, and minus public facility costs funded by interest earnings on the Construction Fund actually earned prior to the date of prepayment. "Outstanding Bonds" means all previously issued Bonds secured by the levy of Special Taxes, which will remain outstanding after the first interest and/or principal payment date following the current Fiscal Year, excluding Bonds to be redeemed at a later date with the proceeds of prior prepayments of Maximum Special Taxes. 1. Prepayment in Full The Maximum Special Tax obligation may only be prepaid and permanently satisfied by a Parcel of Developed Property, Approved Property for which a building permit has been issued, or Public Property and/or Property Owner's Association Property that is not Exempt Property pursuant to Section E. The Maximum Special Tax obligation applicable to such Parcel may be fully prepaid and the obligation of the Parcel to pay the Special Tax permanently satisfied as described herein; provided that a prepayment may be made only if there are no delinquent Special Taxes with respect to the Parcel at the time of prepayment. An owner of a Parcel intending to prepay the Maximum Special Tax obligation shall provide the CFD Administrator with written notice of intent to prepay, and within 10 business days of receipt of such notice, the CFD Administrator shall notify such owner of the amount of the non-refundable deposit determined to cover the cost to be incurred by the CFD in calculating the proper prepayment amount. Within 5 business days of receipt of such non-refundable deposit, the CFD Administrator shall notify such owner of the Prepayment Amount of such Parcel. Prepayment must be made not less than 60 days prior to any redemption date for any Bonds to be redeemed with the proceeds of such prepaid Special Taxes. The Prepayment Amount (defined below) shall be calculated as summarized below (capitalized terms as defined below): Bond Redemption Amount plus Redemption Premium plus Future Facilities Amount plus Defeasance Amount plus Administrative Fees and Expenses less Reserve Fund Credit Total: equals Prepayment Amount As of the proposed date of prepayment, the Prepayment Amount (defined below) shall be calculated as follows: Paragraph No.: 1. For Parcels of Developed Property, compute the Maximum Special Tax for the Parcel to be prepaid. For Parcels of Approved Property to be prepaid, compute the Maximum Special Tax for that Parcel as though it was already designated as Developed Property, based upon the building permit, which has already been issued for that Parcel. For Parcels of Public Property and/or Property Owner's Association Property to be prepaid, compute the Maximum Special Tax for that Parcel. 2. Divide the Maximum Special Tax computed pursuant to paragraph 1 by the total estimated Maximum Special Taxes based on the Developed Property Special Tax which could be charged on all expected development, less any Parcels which have been prepaid. 3. Multiply the quotient computed pursuant to paragraph 2 by the Outstanding Bonds to compute the amount of Outstanding Bonds to be retired and prepaid (the "Bond Redemption Amount"). 4. Multiply the Bond Redemption Amount computed pursuant to paragraph 3 by the applicable redemption premium, if any, on the Outstanding Bonds to be redeemed on the next applicable redemption date (the "Redemption Premium"). 5. Compute the Future Facilities Costs. 6. Multiply the quotient computed pursuant to paragraph 2 by the amount determined pursuant to paragraph 5 to compute the amount of Future Facilities Costs to be prepaid (the "Future Facilities Amount") 7. Compute the amount needed to pay interest on the Bond Redemption Amount from the first bond interest and/or principal payment date following the current Fiscal Year until the earliest redemption date for the Outstanding Bonds. 8. Determine the Special Taxes levied on the Parcel in the current Fiscal Year which have not yet been paid. 9. Compute the amount the CFD Administrator reasonably expects to derive from the reinvestment of the Bond Redemption Amount less the Future Facilities B-10 Amount from the date of prepayment until the redemption date for the Outstanding Bonds to be redeemed with the prepayment. 10. Add the amounts computed pursuant to paragraphs 7 and 8 and subtract the amount computed pursuant to paragraph 9 (the "Defeasance Amount"). 11. Verify the administrative fees and expenses, including the costs of computation of the prepayment, the costs to invest the prepayment proceeds, the costs of redeeming the Outstanding Bonds, and the costs of recording any notices to evidence the prepayment and the redemption (the "Administrative Fees and Expenses"). 12. The reserve fund credit (the "Reserve Fund Credit") shall equal the lesser of: (a) the expected reduction in the reserve requirement (as defined in the Indenture), if any, associated with the redemption of Outstanding Bonds as a result of the prepayment, or (b) the amount derived by subtracting the new reserve requirement (as defined in the Indenture) in effect after the redemption of Outstanding Bonds as a result of the prepayment from the balance in the reserve fund on the prepayment date, but in no event shall such amount be less than zero. 13. The Maximum Special Tax prepayment is equal to the sum of the amounts computed pursuant to paragraphs 3, 4, 6, 10 and 11, less the amount computed pursuant to paragraph 12 (the "Prepayment Amount"). 14. From the Prepayment Amount, the amounts computed pursuant to paragraphs 3, 4, 10 and 12 shall be deposited into the appropriate fund as established under the Indenture and be used to retire Outstanding Bonds or make debt service payments. The amount computed pursuant to paragraph 6 shall be deposited into the Construction Fund. The amount computed pursuant to paragraph 11 shall be retained by the CFD. The Prepayment Amount may be sufficient to redeem other than a $5,000 increment of Bonds. In such cases, the increment above $5,000 or integral multiple thereof will be retained in the appropriate fund established under the Indenture to be used with the next prepayment of Bonds or to make debt service payments. As a result of the payment of the current Fiscal Year's Special Tax levy as determined under paragraph 8 (above), the CFD Administrator shall remove the current Fiscal Year's Special Tax levy for such Parcel from the County tax rolls. With respect to any Parcel that is prepaid, the Board of Directors shall cause a suitable notice to be recorded in compliance with the Act, to indicate the prepayment of Special Taxes and the release of the Special Tax lien on such Parcel, and the obligation of such Parcel to pay the Special Tax shall cease. Notwithstanding the foregoing, no Special Tax prepayment shall be allowed unless the amount of Maximum Special Taxes that may be levied on Taxable Property after the proposed prepayment is at least 1.10 times the maximum annual debt service on all Outstanding Bonds. 2. Prepayment in Part The Maximum Special Tax on a Parcel of Developed Property or a Parcel of Approved Property for which a building permit has been issued may be partially prepaid in increments of $5,000. The amount of the prepayment shall be calculated as in Section H.I., except that a partial prepayment shall be calculated according to the following formula: B-II PP: ((PE -A)x F)+A These terms have the following meaning: PP = the partial prepayment PE = the Prepayment Amount calculated according to Section H.1 F -- the percent by which the owner of the Parcel(s) is partially prepaying the Maximum Special Tax. A = the Administrative Fees and Expenses calculated according to Section H.1 An owner of a Parcel intending to partially prepay the Maximum Special Tax shall notify the CFD Administrator of (i) such owner's intent to partially prepay the Maximum Special Tax, (ii) the percentage by which the Maximum Special Tax shall be prepaid, and (iii) the company or agency that will be acting as the escrow agent, if applicable, and within 10 business days of receipt of such notice, the CFD Administrator shall notify such owner of the amount of the non- refundable deposit determined to cover the cost to be incurred by the CFD in calculating the proper amount of a partial prepayment. Within 5 business days of receipt of such non- refundable deposit, the CFD Administrator shall notify such owner of the partial Prepayment Amount of such Parcel. Partial prepayment must be made not less than 60 days prior to any redemption date for any Bonds to be redeemed with the proceeds of such prepaid Special Taxes. With respect to any Parcel that is partially prepaid, the CFD Administrator shall (i) distribute the funds remitted to it according to Paragraph 14 of Section H.I., and (ii) indicate in the records of the CFD that there has been a partial prepayment of the Maximum Special Tax and that a portion of the Maximum Special Tax equal to the outstanding percentage (1.00 - F) of the remaining Maximum Special Tax shall continue to be authorized to be levied on such Parcel pursuant to Section D. I. TERM OF THE SPECIAL TAX For each year that any Bonds are outstanding the Special Tax shall be levied on all Parcels subject to the Special Tax. If any delinquent Special Taxes remain uncollected prior to or after all Bonds are retired, the Special Tax may be levied to the extent necessary to reimburse the CFD for uncollected Special Taxes associated with the levy of such Special Taxes, but not later than the 2043-2044 Fiscal Year. B-12 EXHIBIT 1 PROPOSED BOUNDARY MAP OF TEMECULA PUBLIC FINANCING AUTHORITY COMMUNn"Y FACILITIES DISTRICT NO, D3-1 (CROWNE HILL) COUNTY OF RIVE RSIDE, STATE OF CALIFORNIA N B-13 EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) ASSESSOR'S PARCEL NUMBERS AND OWNERS OF LAND WITHIN THE DISTRICT County Assessor's Parcel Numbers 952541001-1 952541002-2 952541003-3 952541004-4 952541005-5 952541006-6 952541007-7 952541008-8 952541009-9 952541010-9 952553001-8 952553002-9 952553003-0 952553004-1 952553005-2 952553006-3 952553007-4 952553008-5 952553010-6 952553011-7 952563001-9 952563002-0 952563003-1 952563004-2 952563005-3 952563006-4 952563007-5 952553009-6 952563008-6 952563009-7 952561001-3 952561002-4 952561003-5 952561004-6 952561005-7 952561006-8 952561007-9 952561008-0 952561009-1 952551001-2 952542029-0 952552001-5 952552002-6 952552003-7 952552004-8 952552005-9 952552006-0 952552007-1 952552008-2 952552009-3 952562001-6 952562002-7 952562003-8 952562004-9 952562005-0 952552010-3 952552011-4 952552012-5 952552013-6 952552014-7 952552O15-8 952552016-9 952552017-0 952542001-4 952542002-5 952542003-6 952542004-7 952542005-8 952542006-9 952542007-0 952542008-1 952542009-2 952542010-2 952542011-3 952542012-4 952542013-5 952542014-6 952542015-7 952542016-8 952542017-9 952261005-0 952261006-1 952261007-2 952261008-3 952261009-4 952261010-4 952261011-5 952271001-7 952271002-8 952272001-0 952272002-1 952272003-2 952272004-3 952272005-4 952272006-5 952272007-6 952272008-7 952272009-8 952272O10-8 952272011-9 952272012-0 952272013-1 952272014-2 952272015-3 952272016-4 952272017-5 952272018-6 952272019-7 952272020-7 952272021-8 952272022-9 952272023-0 952272024-1 952272025-2 952272026-3 952272027-4 952272028-5 952272029-6 952272030-6 952272031-7 Owner of Record of Parcels LenOne, Inc. c/o Lennar Communities Inland 391 North Main Street, Suite 301 Corona, CA 92880 952551002-3 952551003-4 952551004-5 952551005-6 952551006-7 952551007-8 952542021-2 952542022-3 952542023-4 952542024-5 952542025-6 952542026-7 952542027-8 952542028-9 952542018-0 952542019-1 952561010-1 952551008-9 952542020-1 952551009-0 952541011-0 952541012-1 952541013-2 952541014-3 952261001-6 952261002-7 952261003-8 952261004-9 952272032-8 952272033-9 952262001-9 952262002-0 952262003-1 952262004-2 952262005-3 952262006-4 952262007-5 952262008-6 952262009-7 952262010-7 952262011-8 952262012-9 (Continued) 952262013-0 952262014-1 952262015-2 952262016-3 952262017-4 952262018-5 952262019-6 952262020-6 952262021-7 952262022-8 952262023-9 952262024-0 952262025-1 952262026-2 952262027-3 952262028-4 952262029-5 952262030-5 952262031-6 952262032-7 952262033-8 952262034-9 952262035-0 952272034-0 952272035-1 952272036-2 952661002-3 952661003-4 952661004-5 952661005-6 952661006-7 952661007-8 952661008-9 952661009-0 952661010-0 952661011-1 952661012-2 952661013-3 952661014-4 952661015-5 952661016-6 952661017-7 952661018-8 952661019-9 952661020-9 952661021-0 952661022-1 952661023-2 952661024-3 952661025-4 952661026-5 952651013-2 952651012-1 952651011-0 952651010-9 952651009-9 952651008-8 952651007-7 952651006-6 952651005-5 952651004-4 952651003-3 952651002-2 952651001-1 952652001-4 952652002-5 952652003-6 952652004-7 952652005-8 952652006-9 952652007-0 952652008-1 952662002-6 952662003-7 952662004-8 952671050-7 952671049-7 952671048-6 952671047-5 952671055-2 952671046-4 952662001-5 952661031-9 952661001-2 952651028-6 952652009-2 952651029-7 952680001-1 952680002-2 952680003-3 952680004-4 952680005-5 952680006-6 952680007-7 952680008-8 952680009-9 952680010-9 952680011-0 952680012-1 952680013-2 952680014-3 952680015-4 952680034-1 952680035-2 952680036-3 952680037-4 952680038-5 952672011-5 952672010-4 952672009-4 952672008-3 952672007-2 952672006-1 952672005-0 952672004-9 952672003-8 952672002-7 952672001-6 952662011-4 952662012-5 952671054-1 952671053-0 952671052-9 952671051-8 952671045-3 952671044-2 952671043-1 952671042-0 952671041-9 952671040-8 952671039-8 952671038-7 952671037-6 952671036-5 952671035-4 952671034-3 952671033-2 952671032-1 952671031-0 952671030-9 952671029-9 952671028-8 952671026-6 952671025-5 952671024-4 952671023-3 952671022-2 952671021-1 952671020-0 952671019-0 952671017-8 952671016-7 952671015-6 952661027-6 952661028-7 952661029-8 952661030-8 952651027-5 952651026-4 952651025-3 952651024-2 952651023-1 952651022-0 952651021-9 952651020-8 952651019-8 952651018-7 952651017-6 952651016-5 952651015-4 952651014-3 952680016-5 952680017-6 952680018-7 952680019-8 952680020-8 952680021-9 952680022-0 952680023-1 952680024-2 952680025-3 952680026-4 952680027-5 952680028-6 952680029-7 95268003O-7 952680031-8 952680032-9 952680033-0 952671014-5 952671013-4 952671012-3 952671O11-2 952671010-1 952671008-0 952671007-9 952671006-8 952671005-7 952671004-6 952671003-5 952671002-4 952671001-3 952671009-1 952671018-9 952671027-7 952680042-8 952680041-7 C-4 (Continued) 952680040-6 952680039-6 952571001-4 952571002-5 952571003-6 952571004-7 952571005-8 952571006-9 952571019-1 952571020-1 952571021-2 952571022-3 952582002-9 952571023-4 952571024-5 952571025-6 952571026-7 952571027-8 952571028-9 952572036-9 952572035-8 952572034-7 952572033-6 952611044-6 952611045-7 952611046-8 952611047-9 952572032-5 952572024-8 952572031-4 952572030-3 952572029-3 952572027-1 952572026-0 952572025-9 952611048-0 952611049-1 952611050-1 952611051-2 952572023-7 952572022-6 952572021-5 952572020-4 952572001-7 952572002-8 952572003-9 952572004-0 952572005-1 952572006-2 952572007-3 952572008.4 952583004-4 952583003-3 952583002-2 952583001-1 952582028-3 952582027-2 952582026-1 952582025-0 952582023-8 952582022-7 952582021-6 952582024-9 952582020-5 952582019-5 952582018-4 952582017-3 952582016-2 952582015-1 952582014-0 952582013-9 952582012-8 952582011-7 952582010-6 952582009-6 952582008-5 952582007.4 952582006-3 952582005-2 952582004-1 952582003-0 952583008-8 952582001-8 952572019-4 957572028-2 957572037-0 952571032-2 952571031-1 952573002-1 952573001-0 C-5 952572009-5 952572010-5 952572011-6 952572012-7 952572013-8 952572014-9 952572015-0 952581001-5 952581002-6 952581003-7 952581004-8 952581005-9 952581006-0 952581007-1 952581008-2 952583007-7 952583006-6 952583005-5 County Assessor's Parcel Numbers 952020045-1 952020046-2 952601042-3 952642030-9 952642031-0 952642032-1 952632010-0 952631024-0 952030058-4 Owner of Record of Parcels PCCIII - Crowne Hill, LLC 30980 Country Center Drive Suite 200 Temecula, CA 92591 County Assessor's Parcel Numbers Owner of Record of Parcels (2-7 952591001-6 952591002-7 952591003-8 952591004-9 952591005-0 952591006-1 952591007-2 952591008-3 952591009-4 952591010-4 952591011-5 952591012-6 952591013-7 952591014-8 952591015-9 952591016-0 952591017-1 952591018-2 952591019-3 952591020-3 952591021-4 952591022-5 952591023-6 952591024-7 952591025-8 952591026-9 952592001-9 952592002-0 952592003-1 952592004-2 952592005-3 952592006-4 952592007-5 952592008-6 952592009-7 952592010-7 952601001-6 952601002-7 952601003-8 952601004-9 952601005-0 952601006-1 952601007-2 952601008-3 952601009-4 952601010-4 952601011-5 952601012-6 952601013-7 952601014-8 952601015-9 952601016-0 952601017-1 952601018-2 952601019-3 952601020-3 952601021-4 952601029-2 952601030-2 952601031-3 952601032-4 952601033-5 952601034-6 952601035-7 952601036-8 952601037-9 952601038-0 952601039-1 952601040-1 952601041-2 952602001-9 952602002-0 952602003-1 952602004-2 952602005-3 952602006-4 952602007-5 952602008-6 952631001-9 952631002-0 952631003-1 952631004-2 952631005-3 952631006-4 952631007-5 952631008-6 952631009-7 952631010-7 952631011-8 952631012-9 952631013-0 952631014-1 952631015-2 952631016-3 952631017-4 952631018-5 952631019-6 952631020-6 952631021-7 952631022-8 952631023-9 952632001-2 952632002-3 952632003-4 952632004-5 952632005-6 952632006-7 952632007-8 952632008-9 952632009-0 952632011-1 952632012-2 952632013-3 952632014-4 952632022-1 952632023-2 952632024-3 952632025-4 952641001-0 952641002-1 952641003-2 952641004-3 952641005-4 952641006-5 952641007-6 952641008-7 952641009-8 952641010-8 952642001-3 952642002-4 952642003-5 952642004-6 952642005-7 952642006-8 952642007-9 952642008-0 952642009-1 952642010-1 952642011-2 952642012-3 952642013-4 952642014-5 952642015-6 952642016-7 952642017-8 952642018-9 952642019-0 952642020-0 952642021-1 952642022-2 952642023-3 952642024-4 952642025-5 952642026-6 952642027-7 952642028-8 952642029-9 952642033-2 952642034-3 952642035-4 952642036-5 952642037-6 952642038-7 952642039-8 952642040-8 952642041-9 952642042-0 952642043-1 952647~_~4-2 952642045-3 952642046-4 KB Home Coastal, Inc. 12235 El Camino Real, Suite 100 San Diego, CA 92130 (Continued) 952642054-1 952642055-2 952642056-3 952642057-4 952642058-5 952642059-6 952642060-6 952642061-7 952642062-8 952642063-9 952642064-0 952642065-1 952642066-2 952642067-3 952642068-4 952642069-5 952642070-5 952642071-6 952642072-7 952642073-8 County Assessor's Parcel Numbers Owner of Record of Parcels 952611001-7 952611OO2-8 952611003-9 952611004-0 952611005-1 952611006-2 952611007-3 952611008-4 952611009-5 952611010-5 952611011-6 952611012-7 952611013-8 952611014-9 952611015-0 952611016-1 952611017-2 952611018-3 952611019-4 952611020-4 952611021-5 952611022-6 952611023-7 952611024-8 952611025-9 952611026-0 952611027-1 952611028-2 952611029-3 952611030-3 952611031-4 952611032-5 952611033-6 952611034-7 952611035-8 952611036-9 952611037-0 952611038-1 952611039-2 952611040-2 952611041-3 952611042-4 952611043-5 952612001-0 952612002-1 952612003-2 952612004-3 952612005-4 952612006-5 952612007-6 952612018-6 952612019-7 952612020-7 952612021-8 952612022-9 952620001-5 952620002-6 952620003-7 952620004-8 952620005-9 952620006-0 952620007-1 952620008-2 952620009-3 952620010-3 952620011-4 952620012-5 952620013-6 952620014-7 952620015-8 952620016-9 952620017-0 952620018-1 952620019-2 952620020-2 952620021-3 952620022-4 952620023-5 952620024-6 952620025-7 952620026-8 952620027-9 952620028-0 952620029-1 952620030-1 952620031-2 952620032-3 952620033-4 952620034-5 952620035-6 952620036-7 952620037-8 952620038-9 952620039-0 952620040-0 952620041-1 C-10 PCClll-Crowne Hill 100 LLC c/o PCCIII - Crowne Hill, LLC 30980 Country Center Drive Suite 200 Temecula, CA 92591 952612008-7 952612009-8 952612010-8 952612011-9 952612012-0 952612013-1 952612O14-2 952612015-3 952612016-4 952612017-5 C-11 County Assessor's Parcel Numbers Owner of Record of Parcels 952571007-0 952571008-1 952571009-2 952571010-2 952571011-3 952571012-4 952571013-5 952571014-6 952571015-7 952571016-8 952571017-9 952571018-0 952571029-0 95257103O-O 952572016-1 952572017-2 952572018-3 Greystone Homes, Inc. C-12 Quint & Thimmlg LLP 3/7/03 3/14/03 FISCAL AGENT AGREEMENT by and between the TEMECULA PUBLIC FINANCING AUTHORITY and U.S. BANK NATIONAL ASSOCIATION, as Fiscal Agent Dated as of June 1, 2003 Relating to: $. Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds 20009.04:J6653 TABLE OF CONTENTS Section 1.01. Section 1.02. Section 1.03. Section 2.01. Section 2.02. Section 2.03. Section 2.04. Section 2.05. Section 2.06. Section 2.07. Section 2.08. Section 2.09. Section 2.10. Section 2.11. Section 2.12. Section 2.13. Section 3.01. Section 3.02. Section 3.03. Section 4.01. Section 4.02. Section 4.03. Section 4.04. Section 4.05. Section 4.06. Section 4.07. Section 4.08. Section 5.01. Section 5.02. Section 5.03. Section 5.04. ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Authority for this Agreement ....................................................................................................... 3 Agreement for Benefit of Owners of the Bonds ......................................................................... 3 Definitions ....................................................................................................................................... 3 ARTICLE II THE BONDS Principal Amount; Designation .................................................................................................. 12 Terms of the Bonds ...................................................................................................................... 12 Redemption ................................................................................................................................... 13 Form of Bonds .............................................................................................................................. 16 Execution of Bonds ...................................................................................................................... 16 Transfer of Bonds ......................................................................................................................... 17 Exchange of Bonds ....................................................................................................................... 17 Bond Register ................................................................................................................................ 17 Temporary Bonds ......................................................................................................................... 18 Bonds Mutilated, Lost, Des~oyed or Stolen ............................................................................. 18 Limited Obligation ....................................................................................................................... 18 No Acceleration ............................................................................................................................ 18 Book-Entry System ....................................................................................................................... 19 ARTICLE III ISSUANCE OF BONDS Issuance and Delivery of Bonds ................................................................................................. 21 Pledge of Special Tax Revenues ................................................................................................. 21 Validity of Bonds .......................................................................................................................... 21 ARTICLE IV FUNDS AND ACCOUNTS Application of Proceeds of Sale of Bonds and Other Moneys ............................................... 22 Improvement Fund ...................................................................................................................... 22 Costs of Issuance Fund ................................................................................................................ 24 Reserve Fund ................................................................................................................................ 24 Bond Fund ..................................................................................................................................... 26 Special Tax Fund .......................................................................................................................... 28 Administrative Expense Fund .................................................................................................... 28 Refunding Fund ........................................................................................................................... 29 ARTICLE V OTHER COVENANTS OF THE AUTHORITY Punctual Payment ........................................................................................................................ 30 Limited Obligation ....................................................................................................................... 30 Extension of Time for Payment .................................................................................................. 30 Against Encumbrances ................................................................................................................ 30 -i- Section 5.05. Section 5.06. Section 5.07. Section 5.08. Section 5.09. Section 5.10. Section 5.11. Section 5.12. Section 5.13. Section 5.14. Section 5.15. Section 5.16. Section 5.17. Section 5.18. Section 5.19. Section 6.01. Section 6.02. Section 6.03. Section 6.04. Section 7.01. Section 7.02. Section 7.03. Section 7.04. Section 7.05. Section 8.01. Section 8.02. Section 8.03. Section 8.04. Section 8.05. Section 8.06. Section 8.07. Section 9.01. Section 9.02. Section 9.03. Section 9.04. Section 9.05. Books and Records ....................................................................................................................... 30 Protection of Security and Rights of Owners ........................................................................... 31 Compliance with Law ................................................................................................................. 31 Collection of Special Tax Revenues ........................................................................................... 31 Covenant to Foreclose ................................................................................................................. 32 Further Assurances ...................................................................................................................... 33 Private Activity Bond Limitations ............................................................................................. 33 Federal Guarantee Prohibition ................................................................................................... 33 Rebate Requirement ..................................................................................................................... 33 No Arbitrage ................................................................................................................................. 33 Yield of the Bonds ........................................................................................................................ 33 Maintenance of Tax-Exemption ................................................................................................. 33 Continuing Disclosure to Owners .............................................................................................. 34 Reduction of Special Taxes ......................................................................................................... 34 Limits on Special Tax Waivers and Bond Tenders .................................................................. 34 ARTICLE VI INVESTMENTS, DISPOSITION OF INVESTMENT PROCEEDS, LIABILITY OF THE AUTHORITY Deposit and Investment of Moneys in Funds .......................................................................... 35 Limited Obligation ....................................................................................................................... 36 Liability of Authority ................................................................................................................... 36 Employment of Agents by Authority ........................................................................................ 37 ARTICLE VII THE FISCAL AGENT Appointment of Fiscal Agent ..................................................................................................... 38 Liability of Fiscal Agent .............................................................................................................. 39 Information ................................................................................................................................... 40 Notice to Fiscal Agent .................................................................................................................. 40 Compensation, Indemnification ................................................................................................. 40 ARTICLE VIII MODIFICATION OR AMENDMENT OF THIS AGREEMENT Amendments Permitted .............................................................................................................. 42 Owners' Meetings ........................................................................................................................ 42 Procedure for Amendment with Written Consent of Owners ............................................... 40 Disqualified Bonds ....................................................................................................................... 43 Effect of Supplemental Agreement ............................................................................................ 43 Endorsement or Replacement of Bonds Issued After Amendments ..................................... 44 Amendatory Endorsement of Bonds ......................................................................................... 44 ARTICLE IX MISCELLANEOUS Benefits of Agreement Limited to Parties ................................................................................. 45 Successor is Deemed Included in All References to Predecessor .......................................... 45 Discharge of Agreement .............................................................................................................. 45 Execution of Documents and Proof of Ownership by Owners .............................................. 46 Waiver of Personal Liability ....................................................................................................... 46 Section 9.06. Section 9.07. Section 9.08. Section 9.09. Section 9.10. Section 9.11. Section 9.12. Section 9.13. Section 9.14. Notices to and Demands on Authority and Fiscal Agent ....................................................... 46 State Reporting Requirements .................................................................................................... 47 Partial Invalidity ........................................................................................................................... 48 Unclaimed Moneys ...................................................................................................................... 48 Applicable Law ............................................................................................................................ 48 Conflict with Act .......................................................................................................................... 49 Conclusive Evidence of Regularity ............................................................................................ 49 Payment on BusIness Day ........................................................................................................... 49 Counterparts ................................................................................................................................. 49 EXHIBIT A - FORM OF BOND -iii- FISCAL AGENT AGREEMENT Temecula Public Financing Authority Community Facilities District No. 03-1 (Crow-ne Hill) 2003 Special Tax Bonds THIS FISCAL AGENT AGREEMENT (the "Agreement"), dated as of June 1, 2003, is by and between the Temecula Public Financing Authority, a joint exercise of powers authority organized and existing under and by virtue of the laws of the State of California (the "Authority") for and on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), and U.S. Bank National Association, a national banking association duly organized and existing under the laws of the United States of America, as fiscal agent (the "Fiscal Agent"). RECITALS: WHEREAS, the Board of Directors of the Authority has formed the District under the provisions of the Mello-Roos Community Facilities Act of 1982, as amended (Section 53311, et seq. of the California Government Code) (the "Act") and Resolution No. TPFA 03- of the Board of Directors of the Authority adopted on March 25, 2003 (the "Resolution of Formation"); WHEREAS, the Board of Directors of the Authority, as the legislative body for the District, is authorized under the Act to levy special taxes to pay for the costs of the District and to authorize the issuance of bonds secured by said special taxes under the Act; WHEREAS, under the provisions of the Act, on May 13, 2003 the Board of Directors of the Authority adopted its Resolution No. TPFA 03-__ (the "Resolution"), which resolution authorized the issuance and sale of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "Bonds"), in the aggregate principal amount of not to exceed $25,000,000, and author/zed the execution hereof; WHEREAS, it is in the public interest and for the benefit of the Authority, the District and the owners of the Bonds that the Authority enter into this Agreement to provide for the issuance of the Bonds, the disbursement of proceeds of the Bonds, the disposition of the special taxes securing the Bonds and the administration and payment of the Bonds; and WHEREAS, the Authority has determined that all things necessary to cause the Bonds, when executed by the Authority for the District and issued as in the Act, the Resolution and this Agreement provided, to be legal, valid and binding and special obligations of the Authority for the District in accordance with their terms, and all things necessary to cause the creation, authorization, execution and delivery of this Agreement and the creation, authorization, execution and issuance of the Bonds, subject to the terms hereof, have in all respects been duly authorized. -1- AGREEMENT: NOW, THEREFORE, in consideration of the covenants and provisions herein set forth and for other valuable consideration the receipt and sufficiency of which is hereby acknowledged, the parties hereto do hereby agree as follows: -2- ARTICLE I STATUTORY AUTHORITY AND DEFINITIONS Section 1.01. Authori .ty for this Agreement. This Agreement is entered into pursuant to the provisions of the Act and the Resolution. Section 1.02. Agreement for Benefit of Owners of the Bonds. The provisions, covenants and agreements herein set forth to be performed by or on behalf of the Authority shall be for the equal benefit, protection and security of the Owners of the Bonds. All of the Bonds, without regard to the time or times of their issuance or maturity, shall be of equal rank without preference, priority or distinction of any of the Bonds over any other thereof, except as expressly provided in or permitted by this Agreement. The Fiscal Agent may become the Owner of any of the Bonds in its own or any other capacity with the same rights it would have if it were not Fiscal Agent. Section 1.03. Definitions. Unless the context otherwise requires, the terms defined in this Section 1.03 shall, for all purposes of this Agreement, of any Supplemental Agreement, and of any certificate, opinion or other document herein mentioned, have the meanings herein specified. All references herein to "Articles," "Sections" and other subdivisions are to the corresponding Articles, Sections or subdivisions of this Agreement, and the words "herein," "hereof," "hereunder" and other words of similar import refer to tkis Agreement as a whole and not to any particular Article, Section or subdivision hereof. "Acquisition Account" means the account by that name established by Section 4.02(A) within the Improvement Fund. "Acquisition Agreement" means the Acquisition Agreement, dated as of March 1, 2003, between the Authority and Lennar, as originally executed and as it may be amended from time to time. "Act" means the Mello-Roos Community Facilities Act of 1982, as amended, being Sections 53311 et seq. of the California Government Code. "Administrative Expenses" means costs directly related to the administration of the District consisting of the costs of computing the Special Taxes and preparing the annual Special Tax collection schedules (whether by the Treasurer or designee thereof or both) and the costs of collecting the Special Taxes (whether by the County or otherwise); the costs of remitting the Special Taxes to the Fiscal Agent; fees and costs of the Fiscal Agent (including its legal counsel) in the discharge of the duties required of it under this Agreement; the costs of the Authority, the City or any designee of either the Authority or the City of complying with the disclosure provisions of the Act, the Continuing Disclosure Agreement and this Agreement, including those related to public inquiries regarding the Special Tax and disclosures to Bondowners and the Original Purchaser; the costs of the Authority, the City or any designee of either the Authority or the City related to an appeal of the Special Tax; any amounts required to be rebated to the federal government in order for the Authority to comply with Section 5.13; an allocable share of the salaries of the City staff directly related to the foregoing and a proportionate amount of City general administrative overhead related thereto. Administrative Expenses shall also include amounts advanced by the Authority or the City for any -3- administrative purpose of the District, including costs related to prepayments of Special Taxes, recordings related to such prepayments and satisfaction of Special Taxes, amounts advanced to ensure compliance with Section 5.13, administrative costs related to the administration of any joint community facilities agreement regarding the District, and the costs of commencing and pursuing foreclosure of delinquent Special Taxes. "Administrative Expense Fund" means the fund by that name established by Section 4.07(A) hereof. 'A_~reement" means this Fiscal Agent Agreement, as it may be amended or supplemented from time to time by any Supplemental Agreement adopted pursuant to the provisions hereof. "Annual Debt Service" means, for each Bond Year, the sum of (i) the interest due on the Outstanding Bonds in such Bond Year, assuming that the Outstanding Bonds are retired as scheduled (including by reason of the provisions of Section 2.03(A)(ii) providing for mandatory sinking payments), and (ii) the principal amount of the Outstanding Bonds due in such Bond Year (including any mandatory sinking payment due in such Bond Year pursuant to Section 2.03(A)(ii)). "Auditor" means the auditor/controller of the County. "Authority" means the Temecula Public Financing Authority and any successor thereto. "Authority Attorney" means any attorney or firm of attorneys employed by the Authority or the City in the capacity of general counsel to the Authority. "Authorized Officer" means the Chairman, Executive Director, Treasurer, Secretary or any other officer or employee authorized by the Board of Directors of the Authority or by an Authorized Officer to undertake the action referenced in this Agreement as required to be undertaken by an Authorized Officer. "Bond Counsel" means (i) Quint & Thimmig LLP, or (ii) any other attorney or firm of attorneys acceptable to the Authority and nationally recognized for expertise in rendering opinions as to the legality and tax-exempt status of securities issued by public entities. "Bond Fund" means the fund by that name established by Section 4.05(A) hereof. "Bond Register" means the books for the registration and transfer of Bonds maintained by the Fiscal Agent under Section 2.08 hereof. "Bond Year" means the one-year period beginning on September 2nd in each year and ending on September 1st in the following year, except that the first Bond Year shall begin on the Closing Date and end on September 1, 2003. "Bonds" means the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds, at any time Outstanding under this Agreement. "Business Day" means any day other than (i) a Saturday or a Sunday, or (ii) a day on which banking institutions in the state in which the Fiscal Agent has its principal corporate trust office are authorized or obligated by law or executive order to be 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. "Caltrans Account" means the account by that name established by Section 4.02(A) within the Improvement Fund. "Capitalized Interest Account" means the account by that name established within the Bond Fund by Section 4.05(A) hereof. "City" means the City of Temecula, California. "City Account" means the account by that name established by Section 4.02(A) within the Improvement Fund. "Closing Date" means June __, 2003, being the date upon which there is a physical delivery of the Bonds in exchange for the amount representing the purchase price of the Bonds by the Original Purchaser. "Code" means the Internal Revenue Code of 1986 as in effect on the date of issuance of the Bonds or (except as otherwise referenced herein) as it may be amended to apply to obligations issued on the date of issuance of the Bonds, together with applicable proposed, temporary and final regulations promulgated, and applicable official public guidance published, under the Code. "Continuing Disclosure Agreement" shall mean that certain Continuing Disclosure Agreement executed by the Authority and the Fiscal Agent on the Closing Date, as originally executed and as it may be amended from time to time in accordance with the terms thereof. "Costs of Issuance" means items of expense payable or reimbursable directly or indirectly by the Authority or the City and related to the authorization, sale and issuance of the Bonds, which items of expense shall include, but not be limited to, printing costs, costs of reproducing and binding docuxnents, closing costs, filing and recording fees, initial fees and charges of the Fiscal Agent including its first annual administration fee, expenses incurred by the City or the Authority in connection with the issuance of the Bonds and the establishment of the District, special tax consultant fees and expenses, preliminary engineering fees and expenses, Bond (underwriter's) discount, legal fees and charges, including bond counsel, disclosure counsel, financial consultants' fees, charges for execution, transportation and safekeeping of the Bonds, landowner expenses related to the District formation, City costs related to the District formation, and other costs, charges and fees in connection with the foregoing. "Costs of Issuance Fund" means the fund by that name established by Section 4.03(A) hereof. "County" means the County of Riverside, California. "Debt Service" means the scheduled amount of interest and amortization of principal payable by reason of Section 2.03(A)(ii) on the Bonds during the period of computation, excluding amounts scheduled during such period which relate to principal which has been retired before the beginning of such period. "Depository." means (a) initially, DTC, and (b) any other Securities Depository acting as Depository pursuant to Section 2.13. "District" means the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill), formed by the Authority under the Act and the Resolution of Formation. "EMWD' means the Eastern Municipal Water District. "EMWD Account" means the account by that name established by Section 4.02(A) within the Improvement Fund. "Fair Market Value" means the price at which a williog buyer would purchase the investment from a willir~g seller in a bona fide, arm's length transaction (determined as of the date the contract to purchase or sell the investment becomes binding) if the investment is traded on an established securities market (within the meaning of section 1273 of the Code) and, otherwise, the term "Fair Market Value" means the acquisition price in a bona fide arm's length transaction (as referenced above) if (i) the investment is a certificate of deposit that is acquired in accordance with applicable regulations under the Code, (ii) the investment is an agreement with specifically negotiated withdrawal or reinvestment provisions and a specifically negotiated interest rate (for example, a guaranteed investment contract, a forward supply contract or other investment agreement) that is acquired in accordance with applicable regulations under the Code, (iii) the investment is a United States Treasury Security--State and Local Government Series that is acquired in accordance with applicable regulations of the United States Bureau of Public Debt, or (iv) the investment is the Local Agency Investment Fund of the State of California but only if at all times during which the investment is held its yield is reasonably expected to be equal to or greater than the yield on a reasonably comparable direct obligation of the United States. "Federal Securities" means any of the following which are non-callable and which at the time of investment are legal investments under the laws of the State of California for funds held by the Fiscal Agent: (i) direct general obligations of the United States of America (including obligations issued or held in book entry form on the books of the United States Depm'tnxent of the Treasury) and obligations, the payment of principal of and interest on which are directly or indirectly guaranteed by the United States of America, including, without limitation, such of the foregoing which are commonly referred to as "stripped" obligations and coupons; or (ii) any of the following obligations of the following agencies of the United States of America: (a) direct obligations of the Export-Import Bank, (b) certificates of beneficial ownership issued by the Farmers Home Administration, (c) participation certificates issued by the General Services Administration, (d) mortgage-backed bonds or pass-through obligations issued and guaranteed by the Government National Mortgage Association, (e) project notes issued by the United -6- States Department of Housing and Urban Development, and (f) public housing notes and bonds guaranteed by the United States of America. "Fiscal Agent" means the Fiscal Agent appointed by the Authority and acting as an independent fiscal agent with the duties and powers herein provided, its successors and assigns, and any other corporation or association which may at any time be substituted in its place, as provided in Section 7.01. "Fiscal Year" means the twelve-month period extending from July 1 in a calendar year to June 30 of the succeeding year, both dates inclusive. "Improvement Fund" means the fund by that name created by and held by the Fiscal Agent pursuant to Section 4.02(A) hereof. "Independent Financial Consultant" means any consultant or firm of such consultants appointed by the Authority, the City or the Treasurer, and who, or each of whom: (i) has experience in matters relating to the issuance and/or administration of bonds under the Act; (ii) is in fact independent and not under the domination of the Authority; (iii) does not have any substantial interest, direct or indirect, with or in the Authority, or any owner of real property in the District, or any real property in the District; and (iv) is not connected with the City or the Authority as an officer or employee of the City or the Authority, but who may be regularly retained to make reports to the City or the Authority. "Information Services" means Financial Information, Inc.'s "Daily Called Bond Service", 30 Montgomery Street, 10th Floor, Jersey City, New Jersey 07302, Attention: Editor; Kenny Information Services' "Called Bond Service", 65 Broadway, 16th Floor, New York, New York 10006; Moody's Investors Service "Municipal and Government", 99 Church Street, New York, New York 10007, Attention: Municipal News Reports; Standard & Poor's Corporation "Called Bond Record", 25 Broadway, 3rd Floor, New York, New York 10004; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such services providing information with respect to called bonds as the Authority may designate in an Officer's Certificate delivered to the Fiscal Agent. "Interest Payment Dates" means March 1 and September I of each year, commencing September 1, 2003. "Joint Community Facilities Agreement - EMWD" means the Joint Commtmity Facilities Agreement, dated as of February 1, 2003, among the Authority, EMWD and Lennar. "|oint Community Facilities Agreement - RCWD" means the Joint Community Facilities Agreement, dated as of March 1, 2003, among the Authority, RCWD and Lennar. "Lennar' means Lennar Homes of California, Inc., a California corporation. "MaxImum Annual Debt Service" means the largest Annual Debt Service for any Bond Year after the calculation is made through the final maturity date of any Outstanding Bonds. "Moody's" means Moody's Investors Service, and any successor thereto. "Officer's Certificate" means a written certificate of the Authority signed by an Authorized Officer of the Authority. "Ordinance" means any ordinance of the Authority levying the Special Taxes. "Original Purchaser" means Stone & Youngberg LLC, the first purchaser of the Bonds from the Authority. "Outstanding," when used as of any particular time with reference to Bonds, means (subject to the provisions of Section 8.04) all Bonds except: (i) Bonds theretofore canceled by the Fiscal Agent or surrendered to the Fiscal Agent for cancellation; (ii) Bonds paid or deemed to have been paid within the meaning of Section 9.03; and (iii) Bonds in lieu of or in substitution for which other Bonds shall have been authorized, executed, issued and delivered by the Authority pursuant to this Agreement or any Supplemental Agreement. "Owner" or "Bondowner' means any person who shall be the registered owner of any Outstanding Bond. "Participating Underwriter" shall have the meaning ascribed thereto in the Continuing Disclosure Agreement. "Permitted Investments" means any of the following, but only to the extent that the same are acquired at Fair Market Value: (a) Federal Securities. (b) Time certificates of deposit or negotiable certificates of deposit issued by a state or nationally chartered bank (including the Fiscal Agent and its affiliates) or trust company, or a state or federal savings and loan association; provided, that the certificates of deposit shall be one or more of the following: continuously and fully insured by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, and/or continuously and fully secured by securities described in subdivision (a) of this definition of Permitted Investments which shall have a market value, as determined on a marked-to-market basis calculated at least weekly, and exclusive of accrued interest, of not less than 102 percent of the principal amount of the certificates on deposit. (c) Commercial paper of "prime" quality of the highest ranking or of the highest letter and numerical rating as provided by either Moody's or S&P, which commercial paper is limited to issuing corporations that are organized and operating within the United States of America and that have total assets in excess of five hundred n~illion dollars ($500,000,000) and that have an "A' or higher rating for the issuer's debentures, other than commercial paper, by either Moody's or S&P, provided that purchases of eligible commercial paper may not exceed 180 days' maturity nor represent more than 10 percent of the outstanding commercial paper of an issuing corporation. -8- (d) A repurchase agreement with a state or nationally charted bank or trust company or a national banking association or government bond dealer reporting to, trading with, and recognized as a primary dealer by the Federal Reserve Bank of New York, provided that all of the following conditions are satisfied: (1) the agreement is secured by any one or more of the securities described in subdivision (a) of this definition of Permitted Investments, (2) the underlying securities are required by the repurchase agreement to be held by a bank, trust company, or primary dealer having a combined capital and surplus of at least one hundred million dollars ($100,000,000) and which is independent of the issuer of the repurchase agreement, and (3) the underlying securities are maintained at a market value, as determined on a marked-to-market basis calculated at least weekly, of not less than 103 percent of the amount so invested. (e) An investment agreement or guaranteed investment contract with, or guaranteed by, a financial institution (not including any insurance company) the long- term unsecured obligations of which are rated "AA" or better by Moody's and S&P at the time of initial investment. The investment agreement shall be subject to a downgrade provision with at least the following requirements: (1) the agreement shall provide that within five business days after the financial institution's long-term unsecured credit rating has been withdrawn, suspended, other than because of general withdrawal or suspension by Moody's or S&P from the practice of rating that debt, or reduced below "AA-" by S&P or below "Aa3" by Moody's (these events are called "rating downgrades") the financial institution shall give notice to the Fiscal Agent and, within the five-day period, and for as long as the rating downgrade is in effect, shall deliver in the name of the Fiscal Agent to the Fiscal Agent federal securities allowed as investments under subdivision (a) of this definition of Permitted Investments with aggregate current market value equal to at least 105 percent of the principal amount of the investment agreement invested with the financial institution at that time, and shall deliver additional allowed federal securities as needed to maintain an aggregate current market value equal to at least 105 percent of the principal amount of the investment agreement within three days after each evaluation date, which shall be at least weekly, and (2) the agreement shall provide that, ff the financial institution's long-term unsecured credit rating is reduced below "A3" by Moody's or below "A-" by S&P, the Fiscal Agent may, upon not more than five business days' written notice to the financial institution, withdraw the investment agreement, with accrued but unpaid interest thereon to the date, and terminate the agreement. (f) The Local Agency Investment Account of the State Treasurer of the State of California as permitted by the State Treasurer pursuant to Section 16429.1 of the California Government Code. (g) Investments in a money market account (including any accounts of the Fiscal Agent or its affiliates) rated in the highest rating category by Moody's or S&P. "Principal Office" means the principal corporate trust office of the Fiscal Agent set forth in Section 9.06, except for the purpose of maintenance of the registration books and presentation of Bonds for payment, transfer or exchange, such term shall mean the office at which the Fiscal Agent conducts its corporate agency business, or such other or additional offices as may be designated by the Fiscal Agent. -9- "Project" means the facilities more particularly described in the Resolution of Formation. "Qualified Reserve Fund Credit Instrument" means an irrevocable standby or direct- pay letter of credit or surety bond issued by a commercial bank or insurance company and deposited with the Fiscal Agent pursuant to Section 4.04(H), provided that all of the following requirements are met: (a) the long-term credit rating or claims paying ability of such bank or insurance company is in one of the two highest rating categories by S&P and Moody's; (b) such letter of credit or surety bond has a term of at least twelve (12) months; (c) such letter of credit or surety bond has a stated amount at least equal to the portion of the Reserve Requirement with respect to which funds are proposed to be released pursuant to Section 4.04(H); and (d) the Fiscal Agent is authorized pursuant to the terms of such letter of credit or surety bond to draw thereunder for the purpose of making payments required pursuant to Section 4.04. "RCWD' means the Rancho California Water District. "RCWD Account" means the account by that name established by Section 4.02(A) within the Improvement Fund. "Record Date" means the fifteenth day of the month next preceding the month of the applicable Interest Payment Date, whether or not such day is a Business Day. "Reftmding Fund" means the fund by that name established pursuant to Section 4.08(A). "Reserve Fund" means the fund by that name established pursuant to Section 4.04(A) hereof. "Reserve Requirement" means, as of any date of calculation an amount equal to the least of (i) the then Maximum Annual Debt Service, (ii) one hundred twenty-five percent (125%) of the then average Annual Debt Service, or (iii) ten percent (10%) of the then Outstanding principal amount of the Bonds. The Reserve Requirement as of the Closing Date is "Resolution" means Resolution No. TPFA 03- the Authority on May 13, 2003. , adopted by the Board of Directors of "Resolution of Formation" means Resolution No. TPFA 03- of Directors of the Authority on March 25, 2003. adopted by the Board "Resolution of Intention" means Resolution No. TPFA 03- Directors of the Authority on January 28, 2003. , adopted by the Board of "S&P" means Standard & Poor's Ratings Service, a division of McGraw-Hill, and any successor thereto. -10- "Securities Depositories" means The Depository Trust Company, 55 Water Street, 504 Floor, New York, New York 10041-0099, Attention: Call Notification Department, Fax (212) 855- 7232; and, in accordance with then current guidelines of the Securities and Exchange Commission, such other addresses and/or such other securities depositories as the Authority may designate in an Officer's Certificate delivered to the Fiscal Agent. "Special Tax Fund" means the fund by that name established by Section 4.06(A) hereof. "Special Tax Prepayments" means the proceeds of any Special Tax prepayments received by the Authority, as calculated pursuant to the Rate and Method of Apportionment of the Special Taxes for the District, less any administrative fees or penalties collected as part of any such prepayment. "Special Tax Prepayments Account" means the account by that name established within the Bond Fund by Section 4.05(A) hereof. "Special Tax Revenues" means the proceeds of the Special Taxes received by the Authority, including any scheduled payments and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest thereon. "Special Tax Revenues" does not include any penalties collected in connection with delinquent Special Taxes. "Special Taxes" means the special taxes levied within the District pursuant to the Act, the Ordinance and this Agreement. "Supplemental Agreement" means an agreement the execution of which is authorized by a resolution which has been duly adopted by the Authority under the Act and which agreement is amendatory of or supplemental to this Agreement, but only if and to the extent that such agreement is specifically authorized hereunder. "Tax Consultant" means Albert A. Webb Associates or another independent financial or tax consultant retained by the Authority or the City for the purpose of computing the Special Taxes. "Treasurer" means the Treasurer of the Authority or such other officer or employee of the Authority performing the functions of the chief financial officer of the Authority. -11- ARTICLE II THE BONDS Section 2.01. Principal Amount; Designation. Bonds in the aggregate principal amount of Million Dollars ($. ) are hereby authorized to be issued by the Authority for the District under and subject to the terms of the Resolution and this Agreement, the Act and other applicable laws of the State of California. The Bonds shall be designated as the "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds.' Section 2.02. Terms of the Bonds. (A) Form; Denominations. The Bonds shall be issued as fully registered Bonds without coupons in the denomination of $5,000 or any integral multiple in excess thereof. (B) Date of Bonds.. The Bonds shall be dated the Closing Date. (C) CUSIP Identification Numbers. "CUSIP" identification numbers shall be imprinted on the Bonds, but such numbers shall not constitute a part of the contract evidenced by the Bonds and any error or omission with respect thereto shall not constitute cause for refusal of any purchaser to accept delivery of and pay for the Bonds. In addition, failure on the part of the Authority or the Fiscal Agent to use such CUSIP numbers in any notice to Owners shall not constitute an event of default or any violation of the Authority's contract with such Owners and shall not impair the effectiveness of any such notice. (D) Maturities, Interest Rates. The Bonds shall mature and become payable on September ! in each of the years, and shall bear interest at the rates per annum as follows: Maturity Date (september 1) Principal Amount [to come] Interest Rate -12- (E) Interest. The Bonds shall bear Interest at the rates set forth above payable on the Interest Payment Dates in each year. Interest shall be calculated on the basis of a 360-day year composed of twelve 30-day months. Each Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or (ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is authenticated prior to the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Bond Date; provided, however, that if at the time of authentication of a Bond, interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. (F) Method of Payment. Interest on the Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer (i) to the Depository (so long as the Bonds are in book-entry form pursuant to Section 2.14), or (ii) to an account within the United States made on such Interest Payment Date upon written instructions of any Owner of $1,000,000 or more in aggregate principal amount of Bonds received before the applicable Record Date, which instructions shall continue in effect until revoked in writing, or until such Bonds are transferred to a new Owner. The principal of the Bonds and any premium on the Bonds are payable by check in lawful money of the United States of America upon surrender of the Bonds at the Principal Office of the Fiscal Agent. All Bonds paid by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and issue a certificate of destruction thereof to the Authority upon the Authority's request. Section 2.03. Redemption. (A) Redemption Dates. (i) Optional Redemption. The Bonds maturing on and after September 1, 2013 are subject to optional redemption prior to their stated maturity on any Interest Payment Date on or after September 1, 2012, as a whole or in part, among maturities so as to maintain substantially level debt service and by lot within a maturity, at a redemption price (expressed as a percentage of the principal amount of the Bonds to be redeemed), as set forth below, together with accrued interest thereon to the date fixed for redemption: Redemption Dates September 1, 2012 and March 1, 2013 September 1, 2013 and any Interest Payment Date thereafter Redemption Prices 102% 100 (ii) Mandatory Sinking Payment Redemption. The Bonds maturing on September , are subject to mandatory sinking payment redemption in part on September 1, -13- __~ and on each September 1 thereafter to maturity, by lot, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date fixed for redemption, without premium, from sinking payments as follows: Redemption Date (September 1) Sinking Payments [to come] The Bonds maturing on September 1, , are subject to mandatory sinking payment redemption in part on September 1, , and on each September 1 thereafter to maturity, by lot, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date fixed for redemption, without premium, from sinking payments as follows: Redemption Date (September 1) Sinking Payments [to come] The amounts in the foregoing tables shall be reduced to the extent practicable so as to maintain level debt service on the Bonds, as a result of any prior partial redemption of the Bonds pursuant to Section 2.03(A)(i) above or Section 2.03(A)(iii) below, as specified in writing by the Treasurer to the Fiscal Agent. (iii) Redemption From Special Tax Prepayments. Special Tax Prepayments and any corresponding transfers from the Reserve Fund pursuant to Section 4.05(B)(ii) and Section 4.04(F), respectively, shall be used to redeem Bonds on the next Interest Payment Date for which notice of redemption can timely be given under Section 2.03(D), by lot and allocated among maturities of the Bonds so as to maintain substantially level debt service on the Bonds, at a redemption price (expressed as a percentage at the principal amount of the Bonds to be redeemed), as set forth below, together with accrued interest to the date fixed for redemption: Redemption Dates Any Interest Payment Date from September 1, 2003 to and including March 1, 2013 September 1, 2013 and any Interest Payment Date thereafter Redemption Prices 102% 100 (B) Notice to Fiscal Agent. The Authority shall give the Fiscal Agent written notice of its intention to redeem Bonds pursuant to subsecllon (A)(i) or (A)(iii) not less than forty-five (45) days prior to the applicable redemption date, or such lesser number of days as shall be consented to by the Fiscal Agent. (C) Purchase of Bonds in Lieu of Redemption. In lieu of redemption under Section 2.03(A), moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase and any premium which would otherwise be due ff such Bonds were to be redeemed in accordance with this Agreement. (D) Redemption Procedure by Fiscal Agent. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption, to the Original Purchaser, to the Securities Depositories, to one or more Information Services, and to the respective registered Owners of any Bonds designated for redempllon, at their addresses appearing on the Bond registration books in the Principal Office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds. Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding Bonds are to be called for redemption, shall designate the CUSIP numbers and Bond numbers of the Bonds to be redeemed by giving the individual CUSIP number and Bond number of each Bond to be redeemed or shall state that all Bonds between two stated Bond numbers, both inclusive, are to be redeemed or that all of the Bonds of one or more maturities have been called for redemption, shall state as to any Bond called in part the principal amount thereof to be redeemed, and shall require that such Bonds be then surrendered at the Principal Office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such Bonds will not accrue from and after the redemption date. -15- Upon the payment of the redemption price of Bonds being redeemed, each check or other transfer of funds issued for such purpose shall to the extent practicable, bear the CUSIP number identifying, by issue and maturity, of the Bonds being redeemed with the proceeds of such check or other transfer. Whenever provision is made in this Agreement for the redemption of less than all of the Bonds or any given portion thereof, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof not previously called for redemption, among maturities as directed in writing by the Treasurer (who shall specify Bonds to be redeemed so as to maintain, as much as practicable, the same debt service profile for the Bonds as in effect prior to such redemption, unless otherwise specified herein), and by lot within a maturity in any manner which the Fiscal Agent deems appropriate. Upon surrender of Bonds redeemed in part only, the Authority shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the Authority, a new Bond or Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds. (E) Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the Bonds so called for redemption shall have been deposited in the Bond Fund, such Bonds so called shall cease to be entitled to any benefit under this Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in such notice. All Bonds redeemed and purchased by the Fiscal Agent pursuant to this Section shall be canceled by the Fiscal Agent. The Fiscal Agent shall destroy the canceled Bonds and issue a certificate of destruction thereof to the Authority. Section 2.04. Form of Bonds. The Bonds, the form of Fiscal Agent's certificate of authentication and the form of assignment, to appear thereon, shall be substantially in the forms, respectively, set forth in Exhibit A attached hereto and by this reference incorporated herein, with necessary or appropriate variations, omissions and insertions, as permitted or required by this Agreement, the Resolution and the Act. Section 2.05. Execution of Bonds. The Bonds shall be executed on behalf of the Authority by the manual or facsimile signatures of its Chairman and Secretary who are in office on the date of adoption of this Agreement or at any time thereafter, and the seal of the Authority shall be impressed, imprinted or reproduced by facsimile signature thereon. If any officer whose signature appears on any Bond ceases to be such officer before delivery of the Bonds to the owner, such signature shall nevertheless be as effective as if the officer had remained in office until the delivery of the Bonds to the owner. Any Bond may be signed and attested on behalf of the Authority by such persons as at the actual date of the execution of such Bond shall be the proper officers of the Authority although at the nominal date of such Bond any such person shall not have been such officer of the Authority. Only such Bonds as shall bear thereon a certificate of authentication in substantially the form set forth in Exhibit A, executed and dated by the Fiscal Agent, shall be valid or obligatory for any purpose or entitled to the benefits of this Agreement, and such certificate of authentication of the Fiscal Agent shall be conclusive evidence that the Bonds registered hereunder have been duly authenticated, registered and delivered hereunder and are entitled to the benefits of this Agreement. Section 2.06. Transfer of Bonds. Any Bond may, in accordance with its terms, be transferred, upon the books required to be kept pursuant to the provisions of Section 2.08 by the person in whose name it is registered, in person or by his duly authorized attorney, upon surrender of such Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form acceptable to the Fiscal Agent. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer shah be paid by the Authority. The Fiscal Agent shah collect from the Owner requesting such transfer any tax or other governmental charge required to be paid with respect to such transfer. Whenever any Bond or Bonds shall be surrendered for transfer, the Authority shah execute and the Fiscal Agent shah authenticate and deliver a new Bond or Bonds, for like aggregate principal amount of authorized denomination(s). No transfers of Bonds shah be required to be made (i) fifteen days prior to the date established by the Fiscal Agent for selection of Bonds for redemption, (ii) with respect to a Bond after such Bond has been selected for redemption, or (iii) between a Record Date and the succeeding Interest Payment Date. Section 2.07. Exchange of Bonds. Bonds may be exchanged at the Principal Office of the Fiscal Agent for a like aggregate principal amount of Bonds of authorized denominations and of the same series and maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such exchange shah be paid by the Authority. The Fiscal Agent shah collect from the Owner requesting such exchange any tax or other goverrtmental charge required to be paid with respect to such exchange. No exchanges of Bonds shah be required to be made (i) fifteen days prior to the date established by the Fiscal Agent for selection of Bonds for redemption, (ii) with respect to a Bond after such Bond has been selected for redemption, or (iii) between a Record Date and the succeeding Interest Payment Date. Section 2.08. Bond Register. The Fiscal Agent will keep or cause to be kept, at its Principal Office sufficient books for the registration and transfer of the Bonds, which books shah show the series number, date, amount, rate of interest and last known Owner of each Bond and shah at aH times be open to inspection by the Authority during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent shaH, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the Bonds as hereinbefore provided. The Authority and the Fiscal Agent will treat the Owner of any Bond whose name appears on the Bond register as the absolute Owner of such Bond for any and aH purposes, and the Authority and the Fiscal Agent shah not be affected by any notice to the contrary. The Authority and the Fiscal Agent may rely on the address of the Bondowner as it appears in the Bond register for any and all purposes. Section 2.09. Temporary Bonds. The Bonds may be initially issued in temporary form exchangeable for definitive Bonds when ready for delivery. The temporary Bonds may be printed, lithographed or typewritten, shall be of such authorized denominations as may be determined by the Authority, and may contain such reference to any of the provisions of this Agreement as may be appropriate. Every temporary Bond shall be executed by the Authority upon the same conditions and in substantially the same manner as the definitive Bonds. If the Authority issues temporary Bonds it will execute and furnish definitive Bonds without delay and thereupon the temporary Bonds shall be surrendered, for cancellation, in exchange for the definitive Bonds at the Principal Office of the Fiscal Agent or at such other location as the Fiscal Agent shall designate, and the Fiscal Agent shall authenticate and deliver in exchange for such temporary Bonds an equal aggregate principal amount of definitive Bonds of authorized denominations. Until so exchanged, the temporary Bonds shall be entitled to the same benefits under to this Agreement as definitive Bonds authenticated and delivered hereunder. Section 2.10. Bonds Mutilatedr Lost, Destroyed or Stolen. If any Bond shall become mutilated, the Authority, at the expense of the Owner of said Bond, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in exchange and substitution for the Bond so mutilated, but only upon surrender to the Fiscal Agent of the Bond so mutilated. Every mutilated Bond so surrendered to the Fiscal Agent shall be canceled by it and destroyed by the Fiscal Agent who shall deliver a certificate of destruction thereof to the Authority. If any Bond shall be lost, destroyed or stolen, evidence of such loss, destruction or theft may be submitted to the Fiscal Agent and, if such evidence be satisfactory to it and indemnity for the Authority and the Fiscal Agent satisfactory to the Fiscal Agent shall be given, the Authority, at the expense of the Owner, shall execute, and the Fiscal Agent shall authenticate and deliver, a new Bond of like tenor and principal amount in lieu of and in substitution for the Bond so lost, destroyed or stolen. The Authority may require payment of a sm not exceeding the actual cost of preparing each new Bond delivered under this Section and of the expenses which may be incurred by the Authority and the Fiscal Agent for the preparation, execution, authentication and delivery. Any Bond delivered under the provisions of this Section in lieu of any Bond alleged to be lost, destroyed or stolen shall constitute an original additional contractual obligation on the part of the Authority whether or not the Bond so alleged to be lost, destroyed or stolen is at any time enforceable by anyone, and shall be equally and proportionately entitled to the benefits of this Agreement with all other Bonds issued pursuant to this Agreement. Section 2.11. Limited Obligation. All obligations of the Authority under this Agreement and the Bonds shall be special obligations of the Authority, payable solely from the Special Tax Revenues and the funds pledged therefore hereunder. Neither the faith and credit nor the taxing power of the Authority (except to the limited extent set forth herein) or the State of California or any political subdivision thereof is pledged to the payment of the Bonds. The City has no obligations whatsoever under this Agreement or otherwise with respect to the Bonds. Section 2.12. No Acceleration. The principal of the Bonds shall not be subject to acceleration hereunder. Noth/ng in this Section shall in any way prohibit the redemption of Bonds under Section 2.03 hereof, or the defeasance of the Bonds and discharge of this Agreement under Section 9.03 hereof. -18- Section 2.13. Book-Entry System. DTC shall act as the initial Depository for the Bonds. One Bond for each maturity of the Bonds shall be initially executed, authenticated, and delivered as set forth herein with a separate fully registered certificate (in print or typewritten form). Upon initial execution, authentication, and delivery, the ownership of the Bonds shall be registered in the Bond Register kept by the Fiscal Agent for the Bonds in the name of Cede & Co., as nominee of DTC or such nominee as DTC shall appoint in writing. The representatives of the City and the Fiscal Agent are hereby authorized to take any and all actions as may be necessary and not inconsistent with this Agreement to qualify the Bonds for the Depository's book-entry system, including the execution of the Depository's required representation letter. With respect to Bonds registered in the Bond Register in the name of Cede & Co., as nominee of DTC, neither the City nor the Fiscal Agent shall have any responsibility or obligation to any broker-dealer, bank, or other financial institufion for which DTC holds Bonds as Depository from time to time (the "DTC Participants") or to any person for which a DTC Participant acquires an interest in the Bonds (the "Beneficial Owners"). Without limiting the immediately preceding sentence, neither the City nor the Fiscal Agent shall have any responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co., or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any notice with respect to the Bonds, including any notice of redemption, (iii) the selection by the Depository of the beneficial interests in the Bonds to be redeemed in the event the City elects to redeem the Bonds in part, (iv) the payment to any DTC Participant, any Beneficial Owner, or any other person, other than DTC, of any amount with respect to the principal of or interest on the Bonds, or (v) any consent given or other action taken by the Depository as Owner of the Bonds. Except as set forth above, the Fiscal Agent may treat as and deem DTC to be the absolute Owner of each Bond for which DTC is acting as Depository for the purpose of payment of the principal of and interest on such Bonds, for the purpose of giving notices of redemption and other matters with respect to such Bonds, for the purpose of registering transfers with respect to such Bonds, and for all purposes whatsoever. The Fiscal Agent shall pay all principal of and interest on the Bonds only to or upon the order of the Owners as shown on the Bond Register, and all such payments shall be valid and effective to fully satisfy and discharge all obligations with respect to the principal of and interest on the Bonds to the extent of the sums or sums so paid. No person other than an Owner, as shown on the Bond Register, shall receive a physical Bond. Upon delivery by DTC to the Fiscal Agent of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the transfer provisions in Secfion 2.06 hereof, references to "Cede & Co." in this Section 2.13 shall refer to such new nominee of DTC. DTC may determine to discontinue providing its services with respect to the Bonds at any time by giving written notice to the Fiscal Agent during any time that the Bonds are Outstanding, and discharging its responsibilities with respect thereto under applicable law. The City may terminate the services of DTC with respect to the Bonds ff it determines that DTC -19- is unable to discharge its responsibilities with respect to the Bonds or that continuation of the system of book-entry transfers through DTC is not in the best interest of the Beneficial Owners, and the City shall mail notice of such termination to the Fiscal Agent. Upon the termination of the services of DTC as provided in the previous paragraph, and if no substitute Depository willing to undertake the functions hereunder can be found which is willing and able to undertake such functions upon reasonable or customary terms, or if the City determines that it is in the best interest of the Beneficial Owners of the Bonds that they be able to obtain certificated Bonds, the Bonds shall no longer be restricted to being registered in the Bond Register of the Fiscal Agent in the name of Cede & Co., as nominee of DTC, but may be registered in whatever name or name the Owners shall designate at that time, in accordance with Section 2.06. To the extent that the Beneficial Owners are designated as the transferee by the Owners, in accordance with Section 2.06, the Bonds will be delivered to such Beneficial Owners as soon as practicable. -20- ARTICLE III ISSUANCE OF BONDS Section 3.01. Issuance and Delivery. of Bonds. At any time after the execution of this Agreement, the Authority may issue the Bonds for the District in the aggregate principal amount set forth in Section 2.01 and deliver the Bonds to the Original Purchaser. The Authorized Officers of the Authority are hereby authorized and directed to deliver any and all documents and instruments necessary to cause the issuance of the Bonds in accordance with the provisions of the Act, the Resolution and this Agreement, to authorize the payment of Costs of Issuance and costs of the Project by the Fiscal Agent from the proceeds of the Bonds and to do and cause to be done any and all acts and things necessary or convenient for delivery of the Bonds to the Original Purchaser. Section 3.02. Pledge of Special Tax Revenues. The Bonds shall be secured by a first pledge (which pledge shah be effected in the manner and to the extent herein provided) of all of the Special Tax Revenues and all moneys deposited in the Bond Fund (including the Special Tax Prepayments Account and the Capitalized Interest Account therein), the Reserve Fund and, until disbursed as provided herein, in the Special Tax Fund. The Special Tax Revenues and all moneys deposited into said funds (except as otherwise provided herein) are hereby dedicated to the payment of the principal of, and interest and any premium on, the Bonds as provided herein and in the Act until aH of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose in accordance with Section 9.03. Amounts in the Administrative Expense Fund, the Improvement Fund (including the accounts therein), the Refunding Fund and the Costs of Issuance Fund are not pledged to the repayment of the Bonds. The Project financed with the proceeds of the Bonds are not in any way pledged to pay the Debt Service on the Bonds. Any proceeds of condemnation or destruction of any portion of the Project are not pledged to pay the Debt Service on the Bonds and are free and clear of any lien or obligation imposed hereunder. Section 3.03. Validity of Bonds. The validity of the authorization and issuance of the Bonds shall not be dependent upon the completion of the construction of the Project, or upon the performance by any person of such persons obligation(s) with respect to the Project. -21- ARTICLE IV FUNDS AND ACCOUNTS Section 4.01. Application of Proceeds of Sale of Bonds and Other Moneys. The proceeds of the purchase of the Bonds by the Original Purchaser (being $ ) shall be paid to the Fiscal Agent, who shall forthwith set aside, pay over and deposit such proceeds on the Closing Date as follows: (A) deposit in the Costs of Issuance Fund an amount equal to $ (B) deposit in the Reserve Fund an amount equal to $ (C) deposit in the Capitalized Interest Account of the Bond Fund an amount equal to $ ; (D) deposit $. to a temporary account on the records of the Fiscal Agent hereby created for such purpose, for immediate transfer to the Treasurer, for deposit by the Treasurer in the Administrative Expense Fund; (E) deposit in the following accounts within the Improvement Fund the following amounts: (i) in the City Account an amount equal to $1,052,313.00, (ii) in the Caltrans Account an amount equal to $1,000,000.00, (iii) in the EMWD Account an amount equal to $2,575,856.00, (iv) in the RCWD Account an amount equal to $1,341,200.00, and (v) in the Acquisition Account an amount equal to $ ; and (F) deposit in the Refunding Fund an amount equal to $ Section 4.02. Improvement Fund (A) Establishment of Improvement Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Improvement Fund (the "Improvement Fund"), and within the Improvement Fund a City Account, a Caltrans Account, an EMWD Account, a RCWD Account and an Acquisition Account. Deposits shall be made to the accounts within the Improvement Fund as required by Section 4.01(E). Moneys in the accounts within the Improvement Fund shall be held in trust by the Fiscal Agent for the benefit of the Authority, and shall be disbursed for the payment or reImbursement of costs of the Project. (B) Procedure for Disbursement. Disbursements from the City Account of the Improvement Fund shall be made by the Fiscal Agent upon receipt of an Officer's Certificate which shall: (i) set forth the amount required to be disbursed, the purpose for which the disbursement is to be made (which shall be for payment of a Project cost or to reimburse expenditures of the Authority, the City or any other party for Project costs previously paid), that the disbursement is a proper expenditure from the City Account of the Improvement Fund, and the person to which the disbursement is to be paid; and (ii) certify that no portion of the -22- amount then being requested to be disbursed was set forth in any Officer's Certificate previously filed requesting a disbursement. Disbursements from the Acquisifion Account within the Improvement Fund shall be made by the Fiscal Agent upon receipt of an Officer's Certificate, which shall: (i) set forth the amount required to be disbursed, the purpose for which the disbursement is to be made (which shall be for a Project cost identified in the Acquisition Agreement), that the disbursement is a proper expenditure from Acquisition Account of the Improvement Fund, and the person to which the disbursement is to be paid; and (ii) certify that no portion of the amount then being requested to be disbursed was set forth in any Officer's Certificate previously filed requesting a disbursement. Disbursements from the Caltrans Account of the Improvement Fund shall be made by the Fiscal Agent upon receipt of an Officer's Certificate which shall: (i) set forth the amount required to be disbursed, the purpose for which the disbursement is to be made (which shall be for payment of a Project cost or to reimburse expenditures of the Authority, the City or any other party for Project costs previously paid, which Project cost relates to the improvement of State Route 79 or interchange improvements at the intersection of Interstate 15 and State Route 79), that the disbursement is a proper expenditure from the Caltrans Account of the Improvement Fund, and the person to which the disbursement is to be paid; and (ii) certify that no portion of the amount then being requested to be disbursed was set forth in any Officer's Certificate previously filed requesting a disbursement. Disbursements from the EMWD Account of the Improvement Fund shall be made by the Fiscal Agent upon receipt of a certificate executed by Lermar and EMWD in the form of Exhibit C to the Joint Community Facilities Agreement - ENIWD which shall set forth the amount required to be disbursed. Disbursements from the RCWD Account of the Improvement Fund shall be made by the Fiscal Agent upon receipt of a certificate executed by Lennar and RCWD in the form of Exhibit C to the Joint Community Facilities Agreement - RCWD which shall set forth the amount required to be disbursed. Each such Officer's Certificate or other certificate submitted to the Fiscal Agent as described in this Section 4.02(B) shall be sufficient evidence to the Fiscal Agent of the facts stated therein, and the Fiscal Agent shall have no duty to confirm the accuracy of such facts. (C) Investment. Moneys in the accounts within the Improvement Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits from the investment and deposit of amounts in the City Account, the Acquisition Account and the Caltrans Account of the Improvement Fund shall be retained in the accounts of the Improvement Fund, respectively, to be used for the purposes of the respective account. Interest earnings and profits from the investment and deposit of amounts in the EMWD Account and the RCWD Account of the Improvement Fund shall be transferred on each Interest Payment Date or on any other date upon receipt by the Fiscal Agent of an Officer's Certificate requesting such transfers to the City Account of the Improvement Fund to be used for the purposes of the City Account of the Improvement Fund. (D) Closing of Accounts. Upon the filing of an Officer's Certificate stating that the Project has been completed and that all costs of the Project have been paid, or that any such costs are not required to be paid from the Improvement Fund, the Fiscal Agent shall transfer the amount, if any, remaining in the accounts within the Improvement Fund to the Bond Fund to be used to pay debt service on the Bonds on the next Interest Payment Date and the Improvement Fund shall be closed. Section 4.03. Costs of Issuance Fund. (A) Establishment of Costs of Issuance Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Costs of Issuance Fund (the "Costs of Issuance Fund"), to the credit of which a deposit shall be made as required by Section 4.01(A). Moneys in the Costs of Issuance Fund shall be held in trust by the Fiscal Agent and shall be disbursed as provided in subsection (B) of this Section for the payment or reimbursement of Costs of Issuance. (B) Disbursement. Amounts In the Costs of Issuance Fund shall be disbursed from time to time to pay Costs of Issuance, as set forth in a requisition containing respective amounts to be paid to the designated payees, signed by the Treasurer and delivered to the Fiscal Agent concurrently with the delivery of the Bonds, or otherwise in an Officer's Certificate delivered to the Fiscal Agent after the Closing Date. The Fiscal Agent shall pay all Costs of Issuance after receipt of an invoice from any such payee which requests payment in an amount which is less than or equal to the amount set forth with respect to such payee pursuant to an Officer's Certificate requesting payment of Costs of Issuance. The Fiscal Agent shall maintain the Costs of Issuance Fund for a period of 90 days from the date of delivery of the Bonds and then shall transfer any moneys remaining therein, including any investment earnings thereon, to the Treasurer for deposit by the Treasurer in the Administrative Expense Fund. (C) Investment. Moneys in the Costs of Issuance Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said Investment shall be retained by the Fiscal Agent in the Costs of Issuance Fund to be used for the purposes of such fund. Section 4.04. Reserve Fund. (A) Establishment of Fund. There is hereby established as a separate fund to be held by the Fiscal Agent the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Reserve Fund (the "Reserve Fund"), to the credit of which a deposit shall be made as required by Section 4.01(B) equal to the Reserve Requirement as of the ClosIng Date for the Bonds, and deposits shall be made as provided in Section 4.06(B). Moneys in the Reserve Fund shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds as a reserve for the payment of principal of, and interest and any premium on, the Bonds and shall be subject to a lien in favor of the Owners of the Bonds. (B) Use of Reserve Fund. Except as otherwise provided in this Section, all amounts deposited in the Reserve Fund shall be used and withdrawn by the Fiscal Agent solely for the purpose of making transfers to the Bond Fund in the event of any deficiency at any time in the Bond Fund of the amount then required for payment of the principal of, and interest and any premium on, the Bonds or, in accordance with the provisions of this Section, for the purpose of redeeming Bonds from the Bond Fund. (C) Transfer Due to Deficiency in Bond Fund. Whenever transfer is made from the Reserve Fund to the Bond Fund due to a deficiency in the Bond Fund, the Fiscal Agent shall provide written notice thereof to the Treasurer, specifying the amount withdrawn. (D) Transfer of Excess of Reserve Requirement. Whenever, on the Business Day prior to any Interest Payment Date, or on any other date at the request of the Treasurer, the amount in the Reserve Fund exceeds the Reserve Requirement, the Fiscal Agent shall provide written notice to the Treasurer of the amount of the excess and shall transfer an amount equal to the excess from the Reserve Fund to the Bond Fund to be used for the payment of interest on the Bonds on the next Interest Payment Date in accordance with Section 4.05. (E) Transfer When Balance Exceeds Outstanding Bonds. Whenever the balance In the Reserve Fund equals or exceeds the amount required to redeem or pay the OutstandIng Bonds, including interest accrued to the date of payment or redemption and premium, if any, due upon redemption, the Fiscal Agent shall upon the written direction of the Treasurer transfer the amount in the Reserve Fund to the Bond Fund to be apphed, on the next succeeding Interest Payment Date to the payment and redemption, in accordance with Section 2.03 and 4.05, as applicable, of all of the Outstanding Bonds. In the event that the amount so transferred from the Reserve Fund to the Bond Fund exceeds the amount required to pay and redeem the Outstanding Bonds, the balance in the Reserve Fund shall be transferred to the Authority to be used for any lawful purpose of the Authority. Notwithstanding the foregoing, no amounts shall be transferred from the Reserve Fund pursuant to this Section 4.04(E) until after (i) the calculation of any amounts due to the federal government pursuant to Section 5.13 following payment of the Bonds and withdrawal of any such amount from the Reserve Fund for purposes of making such payment to the federal government, and (ii) payment of any fees and expenses due to the Fiscal Agent. (F) Transfer Upon Special Tax Prepayment. Whenever Special Taxes are prepaid and Bonds are to be redeemed with the proceeds of such prepayment pursuant to Section 2.03(A)(iii), a proportionate amount in the Reserve Fund (determined on the basis of the principal of Bonds to be redeemed, and the original principal of the Bonds) shall be transferred on the Business Day prior to the redemption date by the Fiscal Agent to the Bond Fund to be applied to the redemption of the Bonds pursuant to Section 2.03(A)(iii). The Treasurer shall deliver to the Fiscal Agent an Officer's Certificate specifying any amount to be so transferred, and the Fiscal Agent may rely on any such Officer's Certificate. (G) Transfer to Pay Rebate. Amounts in the Reserve Fund may at any time be used, at the written direction of an Authorized Officer, for purposes of paying any rebate liability under Section 5.13. (H) Substitution of Qualified Reserve Fund Credit Instrument. The Authority shall have the right at any time to release funds from the Reserve Fund, in whole or in part, by tendering to the Fiscal Agent: (i) a Qualified Reserve Fund Credit Instrument, and (ii) an -25- opinion of Bond Counsel stating that neither the release of such funds nor the acceptance of such Qualified Reserve Fund Credit Instrument will cause interest on the Bonds to become includable in gross income for purposes of federal income taxation. Upon tender of such items to the Fiscal Agent, and upon delivery by the Authority to the Fiscal Agent of a written calculation of the amount permitted to be released from the Reserve Fund (upon which calculation the Fiscal Agent may conclusively rely), the Fiscal Agent shall transfer such funds from the Reserve Fund to the Authority free and clear of the lien of this Agreement. The Fiscal Agent shall comply with all documentation relating to a Qualified Reserve Fund Credit Instrument as shall be required to maintain such Qualified Reserve Fund Credit Instrument in full force and effect and as shall be required to receive payments thereunder in the event and to the extent required to make any payment when and as required under Section 4.04. At least fifteen (15) days prior to the expiration of any Qualified Reserve Fund Credit Instrument, the Authority shall be obligated either (i) to replace such Qualified Reserve Fund Credit Instrument with a new Qualified Reserve Fund Credit Instrument, or (ii) to deposit or cause to be deposited with the Fiscal Agent an amount of funds such that the amount on deposit in the Reserve Fund is equal to the Reserve Requirement (without taking into account such expiring Qualified Reserve Fund Credit Instrument). In the event that the Authority shall fail to take action as specified in clause (i) or (ii) of the preceding sentence, the Fiscal Agent shall, prior to the expiration thereof, draw upon the Qualified Reserve Fund Credit Instrument in full and deposit the proceeds of such draw in the Reserve Fund. In the event that the Reserve Requirement shall at any time be maintained in the Reserve Fund in the form of a combination of cash and a Qualified Reserve Fund Credit Instrtunent, the Fiscal Agent shall apply the amount of such cash to make any payment required to be made from the Reserve Fund before the Fiscal Agent shall draw any moneys under such Qualified Reserve Fund Credit Instrument for such purpose. In the event that the Fiscal Agent shall at any time draw funds under a Qualified Reserve Fund Credit Instrument to make any payment then required to be made from the Reserve Fund, the Special Tax Revenues thereafter received by the Fiscal Agent, to the extent deposited to the Reserve Fund under Section 4.06(B)(ii), shall be used to reinstate the Qualified Reserve Fund Credit Instrument. Section 4.05. Bond Fund. (A) Establishment of Bond Fund, Capitalized Interest Account and Special Tax Prepayments Account. There is hereby established as a separate fund to be held by the Fiscal Agent, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Bond Fund (the "Bond Fund"), to the credit of which deposits shall be made as required by Sections 4.02(D), 4.04(B), 4.04(D), 4.04(E), 4.04(F), and 4.06(B), and any other amounts required to be deposited therein by this Agreement or the Act. There is also hereby created in the Bond Fund, a separate account held by the Fiscal Agent, the Capitalized Interest Account, to the credit of which deposits shall be made under Section 4.01(C). There is also hereby created In the Bond Fund a separate account to be held by the Fiscal Agent, consisting of the Special Tax Prepayments Account, to the credit of which deposits shall be made as provided in Section 4.06(A). Moneys in the Bond Fund and the accounts therein shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bonds, shall be disbursed for the payment of the -26- principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds. (B) Disbursements. (i) Bond Fund Disbursements. On each Interest Payment Date, the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal, and interest and any premium, then due and payable on the Bonds, including any amounts due on the Bonds by reason of the sinking payments set forth in Section 2.03(A)(ii), or a redemption of the Bonds reqtrtred by Section 2.03(A)(i), such payments to be made in the priority listed in the second succeeding paragraph. Notwithstanding the foregoing, amounts in the Bond Fund as a result of a transfer pursuant to Section 4.02(D) shall be used to pay the principal of and interest on the Bonds prior to the use of any other amounts in the Bond Fund for such purpose. In the event that amounts in the Bond Fund are insufficient for the purposes set forth in the preceding paragraph, the Fiscal Agent shall withdraw from the Reserve Fund to the extent of any funds therein amounts to cover the amount of such Bond Fund insufficiency. Amounts so withdrawn from the Reserve Fund shall be deposited in the Bond Fund. If, after the foregoing transfers, there are insufficient funds in the Bbnd Fund to make the payments provided for in the first sentence of the first paragraph of this Section 4.02(B)(i), the Fiscal Agent shall apply the available funds first to the payment of interest on the Bonds, then to the payment of principal due on the Bonds other than by reason of sinking payments, and then to payment of principal due on the Bonds by reason of sinking payments. Any sinking payment not made as scheduled shall be added to the sinking payment to be made on the next sinking payment date. (ii) Special Tax Prepayments Account Disbursements. Moneys in the Special Tax Prepayments Account shall be transferred by the Fiscal Agent to the Bond Fund on the next date for which notice of redemption of Bonds can timely be given under Section 2.03(A)(iii), and notice to the Fiscal Agent can timely be given under Section 2.03(B), and shall be used (together with any amounts transferred pursuant to Section 4.04(F)) to redeem Bonds on the redemption date selected in accordance with Section 2.03. (iii) Capitalized Interest Account Disbursements. Moneys in the Capitalized Interest Account shall be transferred to the Bond Fund on the Business Day prior to each Interest Payment Date, in the amount equal to and to be used for the payment of interest on the Bonds due on the next succeeding Interest Payment Date; provided that no such transfer shall exceed the amount then on deposit in the Capitalized Interest Account. When no amounts remain on deposit in such account, the Capitalized Interest Account shall be closed. (C) Investment. Moneys in the Bond Fund, the Capitalized Interest Account and the Special Tax Prepayments Accotmt shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from the investment and deposit of amounts in the Bond Fund, the Capitalized Interest Account and the Special Tax Prepayments Account shall be retained in the Bond Fund, the Capitalized Interest Account and the Special Tax Prepayments Account, respectively, to be used for purposes of such fund and accounts. Section 4.06. Special Tax Fund. (A) Establishment of Special Tax Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Special Tax Fund (the "Special Tax Fund"), to the credit of which the Fiscal Agent shall deposit amounts received from or on behalf of the Authority consisting of Special Tax Revenues, and any amounts required by Section 4.07(B) to be deposited therein. The Authority shall promptly remit any such amounts received by it to the Fiscal Agent for deposit by the Fiscal Agent to the Special Tax Fund. Notwithstanding the foregoing, (i) any Special Tax Revenues constituting payment of the portion of the Special Tax levy for Administrative Expenses shall be deposited by the Treasurer in the Administrative Expense Fund, and (ii) any proceeds of Special Tax Prepayments shall be transferred by the Treasurer to the Fiscal Agent for deposit by the Fiscal Agent (as specified in writing by the Treasurer to the Fiscal Agent) directly in the Special Tax Prepayments Account established pursuant to Section 4.05(A). Moneys in the Special Tax Fund shall be held in trust by the Fiscal Agent for the benefit of the Authority and the Owners of the Bonds, shall be disbursed as provided below and, pending disbursement, shall be subject to a lien in favor of the Owners of the Bonds and the Authority. (B) Disbursements. On each interest Payment Date, the Fiscal Agent shall withdraw from the Special Tax Fund and transfer the following amounts in the following order of priority (i) to the Bond Fund an amount, taking into account any amounts then on deposit in the Bond Fund and any expected transfers from the Improvement Fund, the Reserve Fund, the Capitalized Interest Account and the Special Tax Prepayments Account to the Bond Fund pursuant to Sections 4.02(D), 4.04(D), (E), and (F), and 4.05(B)(ii) and (iii), such that the amount in the Bond Fund equals the principal (including any sinking payment), premium, if any, and interest due on the Bonds on such Interest Payment Date, and (ii) to the Reserve Fund an amount, taking into account amounts then on deposit in the Reserve Fund, such that the amount in the Reserve Ftmd is equal to the Reserve Requirement. (C) Investment. Moneys in the Special Tax Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from such investment and deposit shall be retained in the Special Tax Fund to be used for the purposes thereof. Section 4.07. Administrative Expense Fund. (A) Establishment of Administrative Expense Fund. There is hereby established as a separate fund to be held by the Treasurer, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Administrative Expense Fund (the "Administrative Expense Fund"), to the credit of which deposits shall be made as required by Sections 4.01(D), 4.03(B) and 4.06(B). Moneys in the Administrative Expense Fund shall be held in trust by the Treasurer for the benefit of the Authority, and shall be disbursed as provided below. -28- (B) Disbursement. Amounts in the Administrative Expense Fund shall be withdrawn by the Treasurer and paid to the Authority or its order upon receipt by the Treasurer of an Officer's Certificate stating the amount to be withdrawn, that such amount is to be used to pay an Administrative Expense or a Costs of Issuance, and the nature of such Administrative Expense or Costs of Issuance. Amounts transferred from the Costs of Issuance Fund to the Administrative Expense Fund pursuant to Section 4.03(B) shall be separately identified at all times, and shall be expended for purposes of the Administrative Expense Fund prior to the use of amounts transferred to the Administrative Expense Fund from the Special Tax Fund pursuant to Section 4.06(B). Annually, on the last day of each Fiscal Year commencing with the last day of Fiscal Year 2003-2004, the Treasurer shall withdraw any amounts then remaining in the Administrative Expense Fund in excess of $20,000 that have not otherwise been allocated to pay Administrative Expenses incurred but not yet paid, and which are not otherwise encumbered, and transfer such amounts to the Fiscal Agent for deposit by the Fiscal Agent in the Special Tax Fund. (C) Investment. Moneys in the Administrative Expense Fund shall be invested and deposited in accordance with Section 6.01. Interest earnings and profits resulting from said investment shall be retained by the Treasurer in the Administrative Expense Fund to be used for the purposes thereof. Section 4.08. Refunding Fund. (A) Establishment of Refunding Fund. There is hereby established as a separate fund to be held by the Fiscal Agent, the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill), Refunding Fund (the "Refunding Fund"), to the credit of which a deposit shall be made as required by Section 4.01(F). Moneys in the Refunding Fund shall be held in trust by the Fiscal Agent for the benefit of the Authority, and shall be disbursed, as provided in subsection (B) of this Section. (B) Procedure for Disbursement. On the Closing Date, all amounts on deposit in the Refunding Fund shall be transferred by the Fiscal Agent to U.S. Bank Trust National Association, as escrow bank under the Escrow Agreement, dated as of June 1, 2003, by and between the Authority and the escrow bank, to be used to pay in full and discharge the assessment liens as provided in said escrow agreement. After disbursement of all amounts on deposit in the Refunding Fund, the Refunding Fund shall be closed. -29- ARTICLE V OTHER COVENANTS OF THE AUTHORITY Section 5.01. Punctual Payment. The Authority will punctually pay or cause to be paid the principal of, and interest and any premium on, the Bonds when and as due in strict conformity with the terms of this Agreement and any Supplemental Agreement, and it will faithfully observe and perform all of the conditions covenants and requirements of this Agreement and aH Supplemental Agreements and of the Bonds. Section 5.02. Limited Obligation. The Bonds are limited obligations of the Authority on behalf of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Bond Fund (including the Special Tax Prepayments Account and the Capitalized Interest Account therein), the Reserve Fund and, until disbursed as provided herein, the Special Tax Fund. Section 5.03. Extension of Time for Payment. In order to prevent any accumulation of claims for interest after maturity, the Authority shah not, directly or indirectly, extend or consent to the extension of the time for the payment of any claim for interest on any of the Bonds and shah not, directly or indirectly, be a party to the approval of any such arrangement by purchasing or funding said claims for interest or in any other manner. In case any such claim for interest shall be extended or funded, whether or not with the consent of the Authority, such claim for interest so extended or funded shah not be entitled, in case of default hereunder, to the benefits of this Agreement, except subject to the prior payment in full of the principal of all of the Bonds then Outstanding and of all claims for interest which shall not have so extended or funded. Section 5.04. Against Encumbrances. The Authority will not encumber, pledge or place any charge or lien upon any of the Special Tax Revenues or other amounts pledged to the Bonds superior to or on a parity with the pledge and lien herein created for the benefit of the Bonds, except as permitted by this Agreement. Section 5.05. Books and Records. The Authority will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the Authority, in which complete and correct entries shall be made of aH transactions relating to the expenditure of amounts disbursed from the Administrative Expense Fund and to the Special Tax Revenues. Such books of record and accounts shall at all times during business hours be subject to the inspection of the Fiscal Agent and the Owners of not less than ten percent (10%) of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing. The Fiscal Agent will keep, or cause to be kept, proper books of record and accounts, separate from all other records and accounts of the Fiscal Agent, in which complete and correct entries shah be made of aH transactions relating to the expenditure of amounts disbursed from the Bond Fund (including the Special Tax Prepayments Account and the Capitalized Interest Account therein), the Reserve Fund, the Special Tax Fund, the Refunding Fund, the Improvement Fund (including the accounts therein) and the Costs of Issuance Fund. Such books of record and accounts shall at aH times during business hours be subject to the -30- inspection of the Authority and the Owners of not less than ten percent (10%) of the principal amount of the Bonds then Outstanding, or their representatives duly authorized in writing upon reasonable prior notice. Section 5.06. Protection of Security and Rights of Owners. The Authority 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 Authority, the Bonds shall be incontestable by the Authority. Section 5.07. Compliance with Law. The Authority will comply with all apphcable provisions of the Act and law in administering the District and completing the acquisition of the Project. Section 5.08. Collection of Special Tax Revenues. The Authority shall comply with all requirements of the Act so as to assure the timely collection of Special Tax Revenues, including without limitation, the enforcement of delinquent Special Taxes. On or within five (5) Business Days of each June 1, the Fiscal Agent shall provide the Treasurer with a notice stating the amount then on deposit in the Bond Fund, the Capitalized Interest Account and the Reserve Fund, and informing the Authority that the Special Taxes may need to be levied pursuant to the Ordinance as necessary to provide for the debt service to become due on the Bonds in the calendar year that commences in the Fiscal Year for which the levy is to be made, and Administrative Expenses and replenishment (if necessary) of the Reserve Fund so that the balance therein equal the Reserve Requirement. The receipt of or failure to receive such notice by the Treasurer shall in no way affect the obligations of the Treasurer under the following two paragraphs. Upon receipt of such notice, the Treasurer shall commtmicate with the Auditor to ascertain the relevant parcels on which the Special Taxes are to be levied, taking into account any parcel splits during the preceding and then current year. The Treasurer shall effect the levy of the Special Taxes each Fiscal Year in accordance with the Ordinance by each July 15 that the Bonds are outstanding, or otherwise such that the computation of the levy is complete before the final date on which Auditor will accept the transmission of the Special Tax amounts for the parcels within the District for inclusion on the next real property 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 real property tax The Treasurer shall fix and levy the amount of Special Taxes within the District required for the payment of principal of and interest on any outstanding Bonds of the District becoming due and payable during the ensuing year, including any necessary replenishment or expenditure of the Reserve Fund for the Bonds and an amount estimated to be sufficient to pay the Administrative Expenses (including amounts necessary to discharge any obligation under Section 5.13) during such year, taking into account the balances in such funds and in the Special Tax Fund. The Special Taxes so levied shall not exceed the authorized amotmts as provided in the proceedings pursuant to the Resolution of Formation. -31- The Special Taxes shall be payable and be collected in the same manner and at the same time and in the same installment 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 ad valorem taxes on real property; provided that, pursuant to and in accordance with the Ordinance, the Special Taxes may be collected by means of direct billing of the property owners within the District, in which event the Special Taxes shall become delinquent if not paid when due pursuant to said billir~g. Section 5.09. Covenant to Foreclose. Pursuant to Section 53356.1 of the Act, the Authority hereby covenants with and for the benefit of the Owners of the Bonds that it will order, and cause to be commenced as hereinafter provided, and thereafter diligently prosecute to judgment (unless such delinquency is theretofore brought current), an action in the superior court to foreclose the lien of any Special Tax or installment thereof not paid when due as provided in the following paragraph. The Treasurer shall notify the Authority Attorney of any such delinquency of which it is aware, and the Authority Attorney shall commence, or cause to be commenced, such proceedings. On or about February 15 and June 15 of each Fiscal Year, the Treasurer shall compare the amount of Special Taxes theretofore levied in the District to the amount of Special Tax Revenues theretofore received by the Authority, and: (A) Individual Delinquencies. If the Treasurer determines that any single parcel subject to the Special Tax in the District is delinquent in the payment of Special Taxes in the aggregate amount of $2,500 or more, then the Treasurer shall send or cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner within 45 days of such determination, and (if the delinquency remains uncured) foreclosure proceedings shall be commenced by the Authority within 90 days of such determination. Notwithstanding the foregoing, the Treasurer may defer such action if the amount in the Reserve Fund is at least equal to the Reserve Requirement. (B) Ag~e~ate Delinquencies. If the Treasurer determines that (i) the total amount of delinquent Special Tax for the prior Fiscal Year for the entire District, (including the total of delinquencies under subsection (A) above), exceeds 5% of the total Special Tax due and payable for the prior Fiscal Year, or (ii) there are ten (10) or fewer owners of real property within the District, determined by reference to the latest available secured property tax roll of the County, the Treasurer shall notify or cause to be notified property owners who are then delinquent in the payment of Special Taxes (and demand immediate payment of the delinquency) within 45 days of such determination, and the Authority shall commence foreclosure proceedings within 90 days of such determination against each parcel of land in the District with a Special Tax delinquency. The Treasurer and the Authority Attorney, as applicable, are hereby authorized to employ counsel to conduct any such foreclosure proceedings. The fees and expenses of any such counsel (including a charge for Authority staff time) in conducting foreclosure proceedings shall be an Administrative Expense hereunder. -32- Section 5.10. Further Assurances. The Authority will adopt, make, execute and dehver any and all such further resolutions, instruments and assurances as may be reasonably necessary or proper to carry out the intention or to facilitate the performance of this Agreement, and for the better assuring and confirming unto the Owners of the rights and benefits provided in this Agreement. Section 5.11. Private Activi .ty Bond Limitations. The Authority shall assure that the proceeds of the Bonds are not so used as to cause the Bonds to satisfy the private business tests of section 141(b) of the Code or the private loan financing test of section 141(c) of the Code. Section 5.12. Federal Guarantee Prohibition. The Authority shall not take any action or permit or suffer any action to be taken ff the result of the same would be to cause the Bonds to be "federally guaranteed" within the meaning of Section 149(b) of the Code. Section 5.13. Rebate Requirement. The Authority shall take any and all actions necessary to assure comphance with section 148(0 of the Code, relating to the rebate of excess investment earnings, if any, to the federal government, to the extent that such section is applicable to the Bonds. If necessary, the Authority may use amounts in the Reserve Fund, amounts on deposit in the Administrative Expense Fund, and any other funds available to the District, including amounts advanced by the Authority or the City, in its respective sole discretion, to be repaid by the District as soon as practicable from amounts described in the preceding clauses, to satisfy its obligations under this Section 5.13. The Treasurer shall take note of any investment of monies hereunder in excess of the yield on the Bonds, and shall take such actions as are necessary to ensure compliance with this Section 5.13, such as increasing the portion of the Special Tax levy for Administration Expenses as appropriate to have funds available in the Administrative Expense Fund to satisfy any rebate liability under this Section 5.13. Section 5.14. No Arbitrage. The Authority shall not take, or permit or suffer to be taken by the Fiscal Agent or otherwise, any action with respect to the proceeds of the Bonds which, ff such action had been reasonably expected to have been taken, or had been deliberately and intentionally taken, on the date of issuance of the Bonds would have caused the Bonds to be "arbitrage bonds" within the meaning of section 148 of the Code. Section 5.15. Yield of the Bonds. In determining the yield of the Bonds to comply with Section 5.13 and 5.14 hereof, the Authority will take into account redemption (including premium, if any) in advance of maturity based on the reasonable expectations of the Authority, as of the Closing Date, regarding prepayments of Special Taxes and use of prepayments for redemption of the Bonds, without regard to whether or not prepayments are received or Bonds redeemed. Section 5.16. Maintenance of Tax-Exemption. The Authority shall take all actions necessary to assure the exclusion of interest on the Bonds from the gross income of the Owners of the Bonds to the same extent as such interest is permitted to be excluded from gross income under the Code as in effect on the date of issuance of the Bonds. -33- Section 5.17. Continuing Disclosure to Owners. In addition to its obligations under Section 9.07, the Authority hereby covenants and agrees that it will comply with and carry out all of the provisions of the Continuing Disclosure Agreement. Notwithstanding any other provision of this Agreement, failure of the Authority to comply with the Continuing Disclosure Agreement shall not be considered a default hereunder; however, any Participating Underwriter or any holder or Beneficial Owner (as defined in Section 2.13) of the Bonds may take such actions as may be necessary and appropriate to compel performance by the Authority of its obligations thereunder, including seeking mandate or specific performance by court order. Two of the owners of the real property in the District as of the Closing Date have also executed continuing disclosure agreements for the benefit of the holders and beneficial owners of the Bonds. Any Participating Underwriter or holder or beneficial owner may take such actions as may be necessary and appropriate directly against either such landowner to compel performance by it of its obligations thereunder, including seeking mandate or specific performance by court order; however the Authority shall have no obligation whatsoever to enforce any obligations under any such agreement. Section 5.18. Reduction of Special Taxes. The Authority covenants and agrees to not consent or conduct proceedings with respect to a reduction in the maximum Special Taxes that may be levied in the District below an amount, for any Fiscal Year, equal to 110% of the aggregate of the debt service due on the Bonds in such Fiscal Year, plus a reasonable estimate of Administrative Expenses for such Fiscal Year. It is hereby acknowledged that Bondowners are purchasing the Bonds in reliance on the foregoing covenant, and that said covenant is necessary to assure the full and timely payment of the Bonds. Section 5.19. Limits on Special Tax Waivers and Bond Tenders. The Authority covenants not to exercise its rights under the Act to waive delinquency and redemption penalties related to the Special Taxes or to declare Special Tax penalties amnesty program if to do so would materially and adversely affect the interests of the owners of the Bonds and further covenants not to 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 Authority having insufficient Special Tax revenues to pay the principal of and interest on the Bonds remaining Outstanding following such tender. ARTICLE VI INVESTMENTS, DISPOSITION OF INVESTMENT PROCEEDS, LIABILITY OF THE AUTHORITY Section 6.01. Deposit and Investment of Moneys in Funds. Moneys In any fund or account created or established by this Agreement and held by the Fiscal Agent shall be Invested by the Fiscal Agent In Permitted Investments, as directed pursuant to an Officer's Certificate filed with the Fiscal Agent at least two (2) BusIness Days In advance of the making of such Investments. In the absence of any such Officer's Certificate, the Fiscal Agent shall Invest, to the extent reasonably practicable, any such moneys In Permitted Investments described In clause (g) of the definition thereof in Section 1.03, which by their terms mature prior to the date on which such moneys are required to be paid out hereunder. The Treasurer shall make note of any Investment of funds hereunder In excess of the yield on the Bonds, so that appropriate actions can be taken to assure compliance with Section 5.13. Moneys In any fund or account created or established by this Agreement and held by the Treasurer shall be invested by the Treasurer in any Permitted Investment, which in any event by their terms mature prior to the date on which such moneys are required to be paid out hereunder. Obligations purchased as an Investment of moneys In any fund shall be deemed to be part of such fund or account, subject, however, to the requirements of this Agreement for transfer of Interest earnings and profits resulting from investment of amounts in funds and accounts. Whenever In this Agreement any moneys are required to be transferred by the Authority to the Fiscal Agent, such transfer may be accomplished by transferring a like amount of Permitted Investments. The Fiscal Agent and its affiliates or the Treasurer may act as sponsor, advisor, depository, principal or agent in the acquisition or disposition of any investment. Neither the Fiscal Agent nor the Treasurer shall Incur any liability for losses arising from any Investments made pursuant to this Section. The Fiscal Agent shall not be required to determine the legality of any investments. Except as otherwise provided in the next sentence, all investments of amounts deposited in any fund or account created by or pursuant to this Agreement, or otherwise containing gross proceeds of the Bonds (within the meaning of section 148 of the Code) shall be acquired, disposed of, and valued (as of the date that valuation is required by this Agreement or the Code) at Fair Market Value. The Fiscal Agent shall have no duty in connection with the determination of Fair Market Value other than to follow the Investment direction of an Authorized Officer In any written direction of any Authorized Officer. Investments in funds or accounts (or portions thereof) that are subject to a yield restriction under the applicable provisions of the Code and (unless valuation is undertaken at least annually) investments In the subaccounts within the Reserve Fund shall be valued at their present value (withIn the meaning of section 148 of the Code). The Fiscal Agent shall not be liable for verification of the application of such sections of the Code. Investments in any and all funds and accounts may be commingled in a separate fund or funds for purposes of making, holding and disposing of Investments, notwithstandIng provisions herein for transfer to or holding in or to the credit of particular funds or accounts of amotmts received or held by the Fiscal Agent or the Treasurer hereunder, provided that the Fiscal Agent or the Treasurer, as applicable, shall at all times account for such investments strictly in accordance with the funds and accounts to which they are credited and otherwise as provided in this Agreement. The Fiscal Agent or the Treasurer, as applicable, shall sell at Fair Market Value, or present for redemption, any investment security whenever it shall be necessary to provide moneys to meet any required payment, transfer, withdrawal or disbursement from the fund or account to which such investment security is credited and neither the Fiscal Agent nor the Treasurer shall be liable or responsible for any loss resulting from the acquisition or disposition of such investment security in accordance herewith. The Authority acknowledges that to the extent regulations of the Comptroller of the Currency or other apphcable regulatory entity grant the Authority the right to receive brokerage confirmations of security transactions as they occur, the Authority specifically waives receipt of such confirmations to the extent permitted by law. The Fiscal Agent will furnish the Authority periodic cash transaction statements which include detail for all investment transactions made by the Fiscal Agent hereunder. Section 6.02. Limited Obligation. The Authority's obligations hereunder are limited obligations of the Authority on behalf of the District and are payable solely from and secured solely by the Special Tax Revenues and the amounts in the Special Tax Fund, the Bond Fund (including the Special Tax Prepayments Account and the Capitalized Interest Accotmt therein) and the Reserve Fund created hereunder. Section 6.03. Liability of Authority. The Authority shall not incur any responsibility in respect of the Bonds or this Agreement other than in connection with the duties or obligations explicitly hereIn or in the Bonds assigned to or imposed upon it. The Authority shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The Authority shall not be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions covenants or agreements of the Fiscal Agent herein or of any of the documents executed by the Fiscal Agent in connection with the Bonds, or as to the existence of a default or event of default thereunder. In the absence of bad faith, the Authority, including the Treasurer, may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Authority and conforming to the requirements of this Agreement. The Authority, including the Treasurer, shall not be liable for any error of judgment made in good faith unless it shall be proved that it was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the Authority to expend or risk its own general funds or otherwise incur any financial habihty (other than with respect to the Special Tax Revenues) in the performance of any of its obhgations hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. -36- The Authority and the Treasurer may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or proper parties. The Authority may consult with counsel, who may be the Authority Attorney, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The Authority 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 satisfactory established, if disputed. Whenever in the administration of its duties under this Agreement the Authority or the Treasurer shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Authority, be deemed to be conclusively proved and established by a certificate of the Fiscal Agent, an Appraiser, an Independent Financial Consultant or a Tax Consultant, and such certificate shall be full warrant to the Authority and the Treasurer for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Authority or the Treasurer may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. Section 6.04. Employment of Agents by Authority. In order to perform its duties and obligations hereunder, the Authority and/or the Treasurer may employ such persons or entities as it deems necessary or advisable. The Authority shall not be liable for any of the acts or omissions of such persons or entities employed by it in good faith hereunder, and shall be entitled to rely, and shall be fully protected in doing so, upon the opinions, calculations, determinations and directions of such persons or entities. ARTICLE VII THE FISCAL AGENT Section 7.01. Appointment of Fiscal Agent. U.S. Bank National Association is hereby appointed Fiscal Agent and paying agent for the Bonds. The Fiscal Agent undertakes to perform such duties, and only such duties, as are specifically set forth in this Agreement, and no implied covenants or obligations shall be read into this Agreement against the Fiscal Agent. Any company into which the Fiscal Agent may be merged or converted or with which it may be consolidated or any company resulting from any merger, conversion or consolidation to which it shall be a party or any company to which the Fiscal Agent may sell or transfer all or substantially all of its corporate trust business, provided such company shall be eligible under the following paragraph of this Section, shall be the successor to such Fiscal Agent without the execution or filing of any paper or any further act, anything herein to the contrary notwithstanding. The Authority may at any time remove the Fiscal Agent initially appointed, and any successor thereto, and may appoint a successor or successors thereto, but any such successor shall be a bank, corporation or trust company having a combined capital (exclusive of borrowed capital) and surplus of at least Fifty Million Dollars ($50,000,000), and subject to supervision or examination by federal or state authority. If such bank, corporation or trust company publishes a report of condition at least annually, pursuant to law or to the requirements of any supervising or examining authority above referred to, then for the purposes of this Section 7.01, combined capital and surplus of such bank or trust company shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. The Fiscal Agent may at any time resign by giving written notice to the Authority and by giving to the Owners notice by mail of such resignation. Upon receiving notice of such resignation, the Authority shall promptly appoint a successor Fiscal Agent by an instrument in writing. Any resignation or removal of the Fiscal Agent shall become effective upon acceptance of appointment by the successor Fiscal Agent. If no appointment of a successor Fiscal Agent shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Fiscal Agent shall have given to the Authority written notice or after a vacancy in the office of the Fiscal Agent shall have occurred by reason of its inability to act, the Fiscal Agent or any Owner may apply to any court of competent jurisdiction to appoint a successor Fiscal Agent. Said court may thereupon, after such notice, if any, as such court may deem proper, appoint a successor Fiscal Agent. If, by reason of the judgment of any court, or reasonable agency, the Fiscal Agent is rendered unable to perform its duties hereunder, all such duties and all of the rights and powers of the Fiscal Agent hereunder shall be assumed by and vest in the Treasurer of the Authority in trust for the benefit of the Owners. The Authority covenants for the direct benefit of the Owners that its Treasurer in such case shall be vested with all of the rights and powers of the Fiscal Agent hereunder, and shall assume all of the responsibilities and perform all of the -38- duties of the Fiscal Agent hereunder, in trust for the benefit of the Owners of the Bonds. In such event, the Treasurer may designate a successor Fiscal Agent qualified to act as Fiscal Agent hereunder. Section 7.02. Liabili .ty of Fiscal Agent. The recitals of facts, covenants and agreements herein and in the Bonds contained shall be taken as statements, covenants and agreements of the Authority, and the Fiscal Agent assumes no responsibility for the correctness of the same, or makes any representations as to the validity or sufficiency of this Agreement or of the Bonds, or shall incur any responsibility in respect thereof, other than in connection with the duties or obligations herein or in the Bonds assigned to or imposed upon it. The Fiscal Agent shall not be liable in connection with the performance of its duties hereunder, except for its own negligence or willful default. The Fiscal Agent assumes no responsibility or liability for any information, statement or recital in any offering memorandum or other disclosure material prepared or distributed with respect to the issuance of the Bonds. In the absence of bad faith, the Fiscal Agent may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Fiscal Agent and conforming to the requirements of this Agreement; but in the case of any such certificates or opinions by which any provision hereof are specifically required to be furnished to the Fiscal Agent, the Fiscal Agent shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Agreement. Except as provided above in this paragraph, Fiscal Agent shall be protected and shall incur no liability in acting or proceeding, or in not acting or not proceeding, in good faith, reasonably and in accordance with the terms of this Agreement, upon any resolution, order, notice, request, consent or waiver, certificate, statement, affidavit, or other paper or document which it shall in good faith reasonably believe to be genuine and to have been adopted or signed by the proper person or to have been prepared and furnished pursuant to any provision of this Agreement, and the Fiscal Agent shall not be under any duty to make any investigation or inquiry as to any statements contained or matters referred to in any such instrument. The Fiscal Agent shall not be liable for any error of judgment made in good faith unless it shall be proved that the Fiscal Agent was negligent in ascertaining the pertinent facts. No provision of this Agreement shall require the Fiscal Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers. The Fiscal Agent shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement at the request or direction of any of the Owners pursuant to this Agreement unless such Owners shall have offered to the Fiscal Agent reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction. The Fiscal Agent may become the owner of the Bonds with the same rights it would have if it were not the Fiscal Agent. 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, and its liability shall be limited to the proper accounting for such funds as it shall actually receive. In order to perform its duties and obligations hereunder, the Fiscal Agent may employ such persons or entities as it deems necessary or advisable. The Fiscal Agent shall not be liable for any of the acts or omissions of such persons or entities employed by it in good faith hereunder, and shall be entitled to rely, and shall be fully protected in doing so, upon the opinions, calculations, determinations and directions of such persons or entities. Section 7.03. Information. The Fiscal Agent shall provide to the Authority such information relating to the Bonds and the funds and accounts maintained by the Fiscal Agent hereunder as the Authority shall reasonably request, including but not limited to quarterly statements reporting funds held and transactions by the Fiscal Agent. Section 7.04. Notice to Fiscal Agent. The Fiscal Agent may rely and shall be protected in acting or refraining from acting upon any notice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or document believed in good faith by it to be genuine and to have been signed or presented by the proper party or proper parties. The Fiscal Agent may consult with counsel, who may be counsel to the Authority, with regard to legal questions, and the opinion of such counsel shall be full and complete authorization and protection in respect of any action taken or suffered by it hereunder in good faith and in accordance therewith. The Fiscal Agent shall not be bound to recognize any person as the Owner of a Bond unless and until such Bond is submitted for inspection, if required, and his title thereto satisfactorily established, if disputed. Whenever in the administration of its duties under this Agreement the Fiscal Agent shall deem it necessary or desirable that a matter be proved or established prior to taking or suffering any action hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of willful misconduct on the part of the Fiscal Agent, be deemed to be conclusively proved and established by an Officer's Certificate, and such certificate shall be full warrant to the Fiscal Agent for any action taken or suffered under the provisions of this Agreement or any Supplemental Agreement upon the faith thereof, but in its discretion the Fiscal Agent may, in lieu thereof, accept other evidence of such matter or may require such additional evidence as to it may seem reasonable. Section 7.05. Compensation, Indemnification. The Authority shall pay to the Fiscal Agent from time to time reasonable compensation for all services rendered as Fiscal Agent under this Agreement, and also all reasonable expenses, charges, counsel fees and other disbursements, including those of their attorneys, agents and employees, incurred in and about the performance of their powers and duties under this Agreement, but the Fiscal Agent shall not have a lien therefor on any funds at any time held by it under this Agreement. The Authority further agrees, to the extent permitted by applicable law, to indemnify and save the Fiscal Agent, its officers, employees, directors and agents harmless against any costs, expenses, claims or liabilities whatsoever, including without limitation fees and expenses of its attorneys, which it may incur in the exercise and performance of its powers and duties hereunder which are not due to its negligence or willful misconduct. The obligation of the Authority under this Section shall survive resignation or removal of the Fiscal Agent under this Agreement and payment of the Bonds and discharge of this Agreement, but any monetary obligation of the Authority arising under this Section shall be limited solely to amounts on deposit in the Administrative Expense Fund. ARTICLE VIII MODIFICATION OR AMENDMENT OF THIS AGREEMENT Section 8.01. Amendments Permitted. This Agreement and the rights and obligations of the Authority and of the Owners of the Bonds may be modified or amended at any time by a Supplemental Agreement pursuant to the affirmative vote at a meeting of Owners, or with the written consent without a meeting, of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding, exclusive of Bonds disqualified as provided in Section 8.04. No such modification or amendment shall (i) extend the maturity of any Bond or reduce the interest rate thereon, or otherwise alter or impair the obligation of the Authority to pay the principal of, and the interest and any premium on, any Bond, without the express consent of the Owner of such Bond, or (ii) permit the creation by the Authority of any pledge or lien upon the Special Taxes superior to or on a parity with the pledge and lien created for the benefit of the Owners of the Bonds (except as otherwise permitted by the Act, the laws of the State of California or this Agreement), or (iii) reduce the percentage of Bonds required for the amendment hereof. Any such amendment may not modify any of the rights or obligations of the Fiscal Agent without its written consent. This Agreement and the rights and obligations of the Authority and of the Owners may also be modified or amended at any time by a Supplemental Agreement, without the consent of any Owners, only to the extent permitted by law and only for any one or more of the following purposes: (A) to add to the covenants and agreements of the Authority in this Agreement contained, other covenants and agreements thereafter to be observed, or to limit or surrender any right or power herein reserved to or conferred upon the Authority; (B) to make modifications not adversely affecting any Outstanding series of Bonds of the Authority in any material respect; (C) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting or supplementing any defective provision contained in this Agreement, or in regard to questions arising under this Agreement, as the Authority or the Fiscal Agent may deem necessary or desirable and not inconsistent with this Agreement, and which shall not adversely affect the rights of the Owners of the Bonds; and (D) to make such additions, deletions or modifications as may be necessary or desirable to assure exemption from gross federal income taxation of interest on the Bonds. Section 8.02. Owners' Meetings. The Authority may at any time call a meeting of the Owners. In such event the Authority is authorized to fix the time and place of said meeting and to provide for the giving of notice thereof, and to fix and adopt rules and regulations for the conduct of said meeting. Section 8.03. Procedure for Amendment with Written Consent of Owners. The Authority and the Fiscal Agent may at any time adopt a Supplemental Agreement amending the provisions of the Bonds or of this Agreement or any Supplemental Agreement, to the extent that such amendment is permitted by Section 8.01, to take effect when and as provided in this Section. A copy of such Supplemental Agreement, together with a request to Owners for their consent thereto, shall be mailed by first class marl, by the Fiscal Agent to each Owner of Bonds Outstanding, but failure to mail copies of such Supplemental Agreement and request shall not affect the validity of the Supplemental Agreement when assented to as in this Section provided. Such Supplemental Agreement shall not become effective unless there shall be filed with the Fiscal Agent the written consents of the Owners of at least sixty percent (60%) in aggregate principal amount of the Bonds then Outstanding (exclusive of Bonds disqualified as provided in Section 8.04) and a notice shall have been mailed as hereinafter in this Section provided. Each such consent shall be effective only if accompanied by proof of ownership of the Bonds for which such consent is given, which proof shall be such as is permitted by Section 9.04. Any such consent shall be binding upon the Owner of the Bonds giving such consent and on any subsequent Owner (whether or not such subsequent Owner has notice thereof) unless such consent is revoked in writing by the Owner giving such consent or a subsequent Owner by filing such revocation with the Fiscal Agent prior to the date when the notice hereinafter in this Section provided for has been mailed. After the Owners of the required percentage of Bonds shall have filed their consents to the Supplemental Agreement, the Authority shall mail a notice to the Owners in the manner hereinbefore provided in this Section for the mailing of the Supplemental Agreement, stating in substance that the Supplemental Agreement has been consented to by the Owners of the required percentage of Bonds and will be effective as provided in this Section (but failure to mail copies of said notice shall not affect the validity of the Supplemental Agreement or consents thereto). Proof of the mailing of such notice shall be filed with the Fiscal Agent. A record, consisting of the papers required by this Section 8.03 to be filed with the Fiscal Agent, shall be proof of the matters therein stated until the contrary is proved. The Supplemental Agreement shall become effective upon the filing with the Fiscal Agent of the proof of mailing of such notice, and the Supplemental Agreement shall be deemed conclusively binding (except as otherwise hereinabove specifically provided in this Article) upon the Authority and the Owners of all Bonds at the expiration of sixty (60) days after such filing, except in the event of a final decree of a court of competent jurisdiction setting aside such consent in a legal action or equitable proceeding for such purpose commenced within such sixty-day period. Section 8.04. Disqualified Bonds. Bonds owned or held for the account of the Authority, excepting any pension or retirement fund, shall not be deemed Outstanding for the purpose of any vote, consent or other action or any calculation of Outstanding Bonds provided for in this Article VIII, and shall not be entitled to vote upon, consent to, or take any other action provided for in this Article VIII; provided, however, that the Fiscal Agent shall not be deemed to have knowledge that any Bond is owned or held by the Authority unless the Authority is the registered Owner or the Fiscal Agent has received written notice that any other registered Owner is an Owner for the account of the Authority. Section 8.05. Effect of Supplemental Agreement. From and after the time any Supplemental Agreement becomes effective pursuant to this Article VIII, this Agreement shall -43- be deemed to be modified and amended in accordance therewith, the respective rights, duties and obligations under this Agreement of the Authority and all Owners of Bonds Outstanding shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such Supplemental Agreement shall be deemed to be part of the terms and conditions of this Agreement for any and all purposes. Section 8.06. Endorsement or Replacement of Bonds Issued After Amendments. The Authority may determine that Bonds issued and delivered after the effective date of any action taken as provided in this Article VIII shall bear a notation, by endorsement or otherwise, in form approved by the Authority, as to such action. In that case, upon demand of the Owner of any Bond Outstanding at such effective date and presentation of his Bond for that purpose at the Principal Office of the Fiscal Agent or at such other office as the Authority may select and designate for that purpose, a suitable notation shall be made on such Bond. The Authority may determine that new Bonds, so modified as in the opinion of the Authority is necessary to conform to such Owners' action, shall be prepared, executed and delivered. In that case, upon demand of the Owner of any Bonds then Outstanding, such new Bonds shall be exchanged at the Principal Office of the Fiscal Agent without cost to any Owner, for Bonds then Outstanding, upon surrender of such Bonds. Section 8.07. Amendatory Endorsement of Bonds. The provisions of this Article VIH shall not prevent any Owner from accepting any amendment as to the particular Bonds held by him, provided that due notation thereof is made on such Bonds. ARTICLE IX MISCELLANEOUS Section 9.01. Benefits of Agreement Limited to Parties. Nothing in this Agreement, expressed or implied, is intended to give to any person other than the Authority, the Fiscal Agent and the Owners, any right, remedy, claim under or by reason of this Agreement. Any covenants, stipulations, promises or agreements in this Agreement contained by and on behalf of the Authority shall be for the sole and exclusive benefit of the Owners and the Fiscal Agent. Section 9.02. Successor is Deemed Included in All References to Predecessor. Whenever in this Agreement or any Supplemental Agreement either the Authority or the Fiscal Agent is named or referred to, such reference shall be deemed to include the successors or assigns thereof, and all the covenants and agreements in this Agreement contained by or on behalf of the Authority or the Fiscal Agent shall bind and inure to the benefit of the respective successors and assigns thereof whether so expressed or not. Section 9.03. Discharge of Agreement. The Authority shall have the option to pay and discharge the entire indebtedness on all or any portion of the Bonds Outstanding in any one or more of the following ways: (A) by well and truly paying or causing to be paid the principal of, and interest and any premium on, such Bonds Outstanding, as and when the same become due and payable; (B) by depositing with the Fiscal Agent, in trust, at or before maturity, money which, together with the amounts then on deposit in the funds and accounts provided for in Sections 4.04 and 4.05 is fully sufficient to pay such Bonds Outstanding, including all principal, interest and redemption premiums; or (C) by irrevocably depositing with the Fiscal Agent, in trust, cash and Federal Securities in such amount as the Authority shall determine as confirmed by Bond Counsel or an independent certified public accountant will, together with the interest to accrue thereon and moneys then on deposit in the fund and accounts provided for in Sections 4.04 and 4.05, be fully sufficient to pay and discharge the indebtedness on such Bonds (including all principal, interest and redemption premiums) at or before their respective maturity dates. If the Authority shall have taken any of the actions specified in (A), (B) or (C) above, and if such Bonds are to be redeemed prior to the maturity thereof notice of such redemption shall have been given as in this Agreement provided or provision satisfactory to the Fiscal Agent shall have been made for the giving of such notice, then, at the election of the Authority, and notwithstanding that any Bonds shall not have been surrendered for payment, the pledge of the Special Taxes and other funds provided for in this Agreement and all other obligations of the Authority under this Agreement with respect to such Bonds Outstanding shall cease and terminate. Notice of such election shall be filed with the Fiscal Agent. Notwithstanding the foregoing, the obligation of the Authority to pay or cause to be paid to the Owners of the Bonds -45- not so surrendered and paid all sums due thereon, all amounts owing to the Fiscal Agent pursuant to Secfion 7.05, and otherwise to assure that no acfion is taken or failed to be taken ff such acfion or failure adversely affects the exclusion of interest on the Bonds from gross income for federal income tax purposes, shall continue in any event. Upon compliance by the Authority with the foregoing with respect to all Bonds Outstanding, any ftmds held by the Fiscal Agent after payment of all fees and expenses of the Fiscal Agent, which are not required for the purposes of the preceding paragraph, shall be paid over to the Authority and any Special Taxes thereafter received by the Authority shall not be remitted to the Fiscal Agent but shall be retained by the Authority to be used for any purpose permitted under the Act. Secfion 9.04. Execufion of Documents and Proof of Ownership by Owners. Any request, declaration or other instrument which this Agreement may require or permit to be executed by Owners may be in one or more instruments of similar tenor, and shall be executed by Owners in person or by their attorneys appointed in writing. Except as otherwise herein expressly provided, the fact and date of the execution by any Owner or his attorney of such request, declarafion or other instrument, or of such writing appointing such attorney, may be proved by the certificate of any notary public or other officer authorized to take acknowledgments of deeds to be recorded in the state in which he purports to act, that the person signing such request, declarafion or other instrument or writing acknowledged to him the execution thereof, or by an affidavit of a witness of such execution, duly sworn to before such notary public or other officer. Except as otherwise herein expressly provided, the ownership of registered Bonds and the amount, maturity, number and date of holding the same shall be proved by the registry books. Any request, declarafion or other instrument or writing of the Owner of any Bond shall bind all future Owners of such Bond in respect of anything done or suffered to be done by the Authority or the Fiscal Agent in good faith and tn accordance therewith. Section 9.05. Waiver of Personal Liability. No director, Councilmember, officer, official, agent or employee of the Authority, the City or the District shall be individually or personally liable for the payment of the principal of, or interest or any premium on, the Bonds; but nothing herein contained shall relieve any such director, Councllmember, officer, official, agent or employee from the performance of any official duty provided by law. Secfion 9.06. Notices to and Demands on Authority and Fiscal Agent. Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Fiscal Agent to or on the Authority may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Authority with the Fiscal Agent) as follows: -46- Temecula Public Financing Authority c/o City of Temecula 43200 Business Park Drive Temecula, CA 92590 Attn: Finance Director Any notice or demand which by any provision of this Agreement is required or permitted to be given or served by the Authority to or on the Fiscal Agent may be given or served by being deposited postage prepaid in a post office letter box addressed (until another address is filed by the Fiscal Agent with the Authority) as follows (provided that any such notice shall not be effective until actually received by the Fiscal Agent): U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, CA 90071 Attention: Corporate Trust Department Section 9.07. State Reporting Requirements. The following requirements shall apply to the Bonds, in addition to those requirements under Section 5.17: (A) Annual Reporting. Not later than October 30 of each calendar year, beginning with the October 30 first succeeding the date of the Bonds, and in each calendar year thereafter until the October 30 following the final maturity of the Bonds, the Treasurer shall cause the following information to be supplied to CDIAC: (i) the principal amount of the Bonds Outstanding; (ii) the balance in the Reserve Fund; (iii) the balance, if any, in the Capitalized Interest Account; (iv) the number of parcels in the District which are delinquent in the payment of Special Taxes, the amount of each delinquency, the length of time delinquent and when foreclosure was commenced for each delinquent parcel; (v) the balances in the accounts within the Improvement Fund; and (vi) the assessed value of all parcels in the District subject to the levy of the Special Taxes as shown in most recent equalized roll. The annual reporting shall be made using such form or forms as may be prescribed by CDIAC. (B) Other Reporting. If at any time the Fiscal Agent fails to pay principal and interest due on any scheduled payment date for the Bonds, or if funds are withdrawn from the Reserve Fund to pay principal and interest on the Bonds, the Fiscal Agent shall notify the Treasurer of such failure or withdrawal in writing. The Treasurer shall notify CDIAC and the Original Purchaser of such failure or withdrawal within 10 days of such failure or withdrawal. (C) Special Tax Reporting. The Treasurer shall file a report with the Authority no later than January 1, 2004, and at least once a year thereafter, which annual report shall contain: (i) the amount of Special Taxes collected and expended with respect to the District, (ii) the amount of Bond proceeds collected and expended with respect to the District, and (iii) the status of the Project. It is acknowledged that the Special Tax Fund and the Special Tax Prepayments Account are the accounts into which Special Taxes collected on the District will be deposited for purposes of Section 50075.1(c) of the California Government Code, and the funds and accounts listed in Section 4.01 are the funds and accounts into which Bond proceeds will be deposited for purposes of Section 53410(c) of the California Government Code, and the annual report described in the preceding sentence is intended to satisfy the requirements of Sections 50075.1(d), 50075.3(d) and 53411 of the California Government Code. (D) Amendment. The reporting requirements of this Section 9.07 shall be amended from time to time, without action by the Authority or the Fiscal Agent (i) with respect to subparagraphs (A) and (B) above, to reflect any amendments to Section 53359.5(b) or Section 53359.5(c) of the Act, and (ii) with respect to subparagraph (C) above, to reflect any amendments to Section 50075.1, 50075.3, 53410 or 53411 of the California Government Code. Notwithstanding the foregoing, any such amendment shall not, in itself, affect the Authority's obligations under the Continuing Disclosure Agreement. The Authority shall notify the Fiscal Agent in writing of any such amendments which affect the reporting obligations of the Fiscal Agent under this Agreement. (E) No Liability. None of the Authority and its officers, agents and employees, the Treasurer or the Fiscal Agent shall be liable for any inadvertent error in reporting the information required by this Section 9.07. The Treasurer shall provide copies of any of such reports to any Bondowner upon the written request of a Bondowner and payment by the person requesting the information of the cost of the Authority to produce such information and pay any postage or other delivery cost to provide the same, as determined by the Treasurer. The term "Bondowner" for purposes of this Section 9.07 shall include any beneficial owner of the Bonds. Section 9.08. Partial Invalidity. If any Section, paragraph, sentence, clause or phrase of this Agreement shall for any reason be held illegal or unenforceable, such holding shall not affect the validity of the remaining portions of this Agreement. The Authority hereby declares that it would have adopted this Agreement and each and every other Section, paragraph, sentence, clause or phrase hereof and authorized the issue of the Bonds pursuant thereto irrespective of the fact that any one or more Sections, paragraphs, sentences, clauses, or phrases of this Agreement may be held illegal, invalid or unenforceable. Section 9.09. Unclaimed Moneys. Anything contained herein to the contrary notwithstanding, any moneys held by the Fiscal Agent in trust for the payment and discharge of the principal of, and the interest and any premium on, the Bonds which remains unclaimed for two (2) years after the date when the payments of such principal, interest and premium have become payable, if such moneys was held by the Fiscal Agent at such date, shall be repaid by the Fiscal Agent to the Authority as its absolute property free from any trust, and the Fiscal Agent shall thereupon be released and discharged with respect thereto and the Owners shall look only to the Authority for the payment of the principal of, and interest and any premium on, such Bonds. Section 9.10. Applicable Law. This Agreement shall be governed by and enforced in accordance with the laws of the State of California applicable to contracts made and performed in the State of California. Section 9.11. Conflict with Act. In the event of a conflict between any provision of this Agreement with any provision of the Act as in effect on the Closing Date, the provision of the Act shall prevail over the conflicting provision of this Agreement. Section 9.12. Conclusive Evidence of Regulari.ty. Bonds issued pursuant to this Agreement shall constitute conclusive evidence of the regularity of all proceedings under the Act relative to their issuance and the levy of the Special Taxes. Section 9.13. Payment on Business Day. In any case where the date of the maturity of interest or of principal iand premium, if any) of the Bonds or the date fixed for redemption of any Bonds or the date any action is to be taken pursuant to this Agreement is other than a Business Day, the payment of interest or principal (and premium, if any) or the action need not be made on such date but may be made on the next succeeding day which is a Business Day with the same force and effect as if made on the date required and no interest shall accrue for the period from and after such date. Section 9.14. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original. -49- IN WITNESS WHEREOF, the Authority caused this Fiscal Agent Agreement to be executed all as of June 1, 2003. TEMECULA PUBLIC FINANCING AUTHORITY, for and on behalf of TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) By: Executive Director U.S. BANK NATIONAL ASSOCIATION, as Fiscal Agent 20009.04:J6653 By: Authorized Officer -50- No. EXHIBIT A FORM OF BOND UNITED STATES OF AMERICA STATE OF CALIFORNIA COUNTY OF RIVERSIDE TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BOND INTEREST RATE MATURITY DATE BOND DATE CUSIP June ~ 2003 REGISTERED OWNER: PRINCIPAL AMOUNt: September 1, DOLLARS The Temecula Public Financing Authority (the "Authority") for and on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District"), for value received, hereby promises to pay solely from the Special Tax (as hereinafter defined) to be collected in the District or amounts in the funds and accounts held under the 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 Bond Date set forth above, or from the most recent interest payment date to which interest has been paid or duly provided for, semiannually on March 1 and September 1, commencing September 1, 2003, at the interest rate set forth above, until the principal amount hereof is paid or made available for payment. The principal of this Bond is payable to the registered owner hereof in lawful money of the United States of America upon presentation and surrender of this Bond at the Principal Office (as defined in the Agreement referred to below) of U.S. Bank National Association (the "Fiscal Agent"). Interest on this Bond shall be paid by check of the Fiscal Agent mailed on each interest payment date to the registered owner hereof as of the close of business on the 15th day of the month preceding the month in which the interest payment date occurs (the "Record Date") at such registered owner's address as it appears on the registration books maintained by the Fiscal Agent, or (i) if the Bonds are in book-entry-only form, or (ii) otherwise upon written request filed with the Fiscal Agent prior to any Record Date by a registered owner of at least $1,000,000 in aggregate principal amount of Bonds, by wire transfer in immediately available funds to the depository for the Bonds or to an account in the United States designated by such registered owner in such written request, respectively. A-1 This Bond is one of a duly authorized issue of bonds approved by the qualified electors of the District pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, Sections 53311, et seq., of the Califomia Government Code (the "Mello-Roos Act") for the purpose of financing certain public facilities within and in the vicinity of the District (the "Project") and to eliminate a lien on property in the District, and is one of the series of Bonds designated "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds" (the "Bonds") in the aggregate principal amount of $. . The creation of the Bonds and the terms and conditions thereof are provided for by resolution adopted by the Board of Directors of the Authority on May 13, 2003 (the "Resolution"), and the Fiscal Agent Agreement, dated as of June 1, 2003, between the Authority and the Fiscal Agent (the "Agreement") and this reference incorporates the Resolution and the Agreement herein, and by acceptance hereof the owner of this Bond assents to said terms and conditions. The Resolution is adopted and the Agreement is entered into under and this Bond is issued under, and all are to be construed in accordance with, the laws of the State of California. Pursuant to the Mello-Roos Act, the Agreement and the Resolution, the principal of and interest on this Bond are payable solely from the annual special tax authorized under the Mello- Roos Act to be collected within the District (the "Special Tax") and certain funds held under the Agreement. Interest on this Bond shall be payable from the interest payment date next preceding the date of authentication hereof, ttnless (i) it is authenticated on an interest payment date, in which event it shall bear interest from such date of authentication, or (ii) it is authenticated prior to an interest payment date and after the close of business on the Record Date preceding such interest payment date, in which event it shall bear interest from such interest payment date, or (iii) it is authenticated prior to the Record Date preceding the first interest payment date, in which event it shall bear interest from the Bond Date set forth above; provided, however, that if at the time of authentication of this Bond, interest is in default hereon, this Bond shall bear interest from the interest payment date to which interest has previously been paid or made available for payment hereon. Any tax for the payment hereof shall be limited to the Special Tax, except to the extent that provision for payment has been made by the Authority, as may be permitted by law. The Bonds do not constitute obligations of the Authority for which the Authority is obligated to levy or pledge, or has levied or pledged, general or special taxation other than described hereinabove. The City of Temecula has no liability or obligations whatsoever with respect to the Bonds or the Agreement. The Bonds are subject to redemption prior to their stated maturity on any interest payment date, as a whole or in part among maturities as provided in the Agreement, at a redemption price (expressed as a percentage of the principal amount of the Bonds to be redeemed), as set forth below, together with accrued interest thereon to the date fixed for redemption: A-2 Redemption Dates September 1, 2012 and March 1, 2013 September 1, 2013 and any interest payment date thereafter Redemption Prices 102% 100 The Bonds maturing on September 1, , are subject to mandatory sinking payment redemption in part on September 1, __ and on each September 1 thereafter to maturity, by lot, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date fixed for redemption, without premium, from sinking payments as follows: Redemption Date (September 1) Sinking Payments The Bonds maturing on September 1, , are subject to mandatory sinking payment redemption in part on September 1, __ and on each September 1 thereafter to maturity, by lot, at a redemption price equal to the principal amount thereof to be redeemed, together with accrued interest to the date fixed for redemption, without premium, from sinking payments as follows: Redemption Date (September 1) Sinking Payments The Bonds are also subject to redemption from the proceeds of Special Tax Prepayments and any corresponding transfers from the Reserve Fund pursuant to the Agreement, on any A-3 Interest Payment Date, among maturities as specified in the Agreement and by lot within a maturity, at a redemption price (expressed as a percentage at the principal amount of the Bonds to be redeemed), as set forth below, together with accrued interest to the date fixed for redemption: Redemption Dates Any interest payment date from September 1, 2003 to and including March 1, 2013 September 1, 2013 and any interest payment date thereafter Redemption Prices 102% 100 Notice of redemption with respect to the Bonds to be redeemed shah be given to the registered owners thereof, in the manner, to the extent and subject to the provisions of the Agreement. This Bond shall be registered in the name of the owner hereof, as to both principal and interest. Each registration and transfer of registration of this Bond shah be entered by the Fiscal Agent in books kept by it for this purpose and authenticated by its manual signature upon the certificate of authentication endorsed hereon. No transfer or exchange hereof shah be valid for any purpose unless made by the registered owner, by execution of the form of assignment endorsed hereon, and authenticated as herein provided, and the principal hereof, interest hereon and any redemption premium shah be payable only to the registered owner or to such owner's order. The Fiscal Agent shah require the registered owner requesting transfer or exchange to pay any tax or other governmental charge required to be paid with respect to such transfer or exchange. No transfer or exchange hereof shall be required to be made (i) fifteen days prior to the date established by the Fiscal Agent for selection of Bonds for redemption, (ii) with respect to a Bond after such Bond has been selected for redemption, or (iii) between a Record Date and the succeeding interest payment date. Exchanges may only be made for Bonds in authorized denominations, as provided in the Agreement. The Agreement and the rights and obligations of the Authority thereunder may be modified or amended as set forth therein. The Bonds are not general obligations of the Authority, but are limited obligations payable solely from the revenues and funds pledged therefor under the Agreement. Neither the faith and credit of the Authority or the State of California or any political subdivision thereof is pledged to the payment of the Bonds. This Bond shall not become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been dated and signed by the Fiscal Agent. IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and things required by law to exist, happen and be performed precedent to and in the issuance of A-4 this Bond have existed, happened and been performed in due time, form and manner as required by law, and that the amount of this Bond does not exceed any debt limit prescribed by the laws or Constitution of the State of California. IN WITNESS WHEREOF, Temecula Public Financing Authority has caused this Bond to be dated the Bond Date set forth above, to be signed by the facsimile signature of its Chairman and countersigned by the facsimile signature of its Secretary. TEMECULA PUBLIC FINANCING AUTHORITY [SEAL] Chairman ATI'EST Secretary A-5 FISCAL AGENT'S CERTIFICATE OF AUTHENTICATION This is one of the Bonds described in the Resolution and in the Agreement which has been authenticated on U.S. Bank National Association, as Fiscal Agent By: Authorized Signatory A-6 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-registered Bond and hereby irrevocably constitute(s) and appoints(s) attorney, to transfer the same on the registration books of the Fiscal Agent with full power of substitution in the premises. Dated: Signature Guaranteed: Signature: Note: Signature(s) must be guaranteed by an eligible guarantor. Note: The signature(s) on this Assignment must correspond with the name(s) as written on the face of the within Bond in every particular without alteration or enlargement or any change whatsoever. A-7 PRELIMINARY OFFICIAL STATEMENT DATED MAY ,2003 NEW ISSUE NOT RATED In the opinion of Quint & Thimmig LLP, San Francisco, California, Bond Counsel, subject, however, to certain qualifications described herein, under existing law, until any Conversion Date with respect thereto, the interest on the 2003 Bonds is excluded from gross income for federal income tax purposes and is not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals and corporations; it should be noted, however, that, for the purpose of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining certain income and earnings. Bond Counsel is also of the opinion that under existing law the interest on the 2003 Bonds is exempt from personal income taxation imposed by the State of California. See "LEGAL MA TTERS Tax Exemption" herein. $18,000,000' TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS Dated: Date of Delivery Due: September 1, as shown below The Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "2003 Bonds") are being issued under the Mello-Roos Community Facilities Act of 1982 (the "Act") and a Fiscal Agent Agreement, dated as of June 1, 2003, by and between the Temecula Public Financing Authority (the "Authority") and U.S. Bank National Association, as Fiscal Agent (the "Fiscal Agent"), and are payable from proceeds of Special Taxes (as defined herein) levied on property within the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") according to the rate and method of apportionment of special tax approved by the qualified electors of the Dis~ict and by the Authority, acting as the legislative body of the District. The 2003 Bonds are being issued (i) to finance the acquisition and construction of certain street and signal improvements, storm drain improvements, sewer and water improvement, fire protection improvements and park and recreation improvements (collectively, the "Improvements") within or in the vicinity of the District, (ii) to eliminate an existing special assessment lien (the "Prior Lien") on parcels in the District, (iii) to pay interest on the 2003 Bonds through September 1, 2003, (iv) to pay certain administrative expenses of the District (v) to pay the costs of issuing the 2003 Bonds and (vi) to establish a Reserve Fund for the 2003 Bonds. See"ESTIMATED SOURCES AND USES OF FUNDS" and "PLAN OF FINANCE; IMPROVEMENTS TO BE FINANCED WITH PROCEEDS OF THE 2003 BONDS" herein. The 2003 Bonds will be issued in denominations of $5,000 or integral multiples in excess thereof. The 2003 Bonds, when delivered, will be initially registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York. DTC will act as securities depository for the 2003 Bonds as described herein under "THE 2003 BONDS - Book-Entry and DTC." The 2003 Bonds are subject to optional redemption, mandatory redemption from prepayment of Special Taxes and mandatory redemption as described herein. THE 2003 BONDS, THE INTEREST THEREON, AND ANY PREMIUMS PAYABLE ON THE REDEMPTION OF ANY OF THE 2003 BONDS, ARE NOT AN INDEBTEDNESS OF THE AUTHORITY, THE DISTRICT (EXCEPT TO THE LIMITED EXTENT SET FORTH IN THE FISCAL AGENT AGREEMENT), THE STATE OF CALIFORNIA (THE "STATE") OR ANY OF ITS POLITICAL SUBDIVISIONS, AND NEITHER THE AUTHORITY, THE DISTRICT (EXCEPT TO THE LIMITED EXTENT SET FORTH IN THE FISCAL AGENT AGREEMENT), THE STATE NOR ANY OF ITS POLITICAL SUBDIVISIONS IS LIABLE ON THE 2003 BONDS. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE AUTHORITY, THE DISTRICT (EXCEPT TO THE LIMITED EXTENT SET FORTH IN THE FISCAL AGENT AGREEMENT) OR THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE 2003 BONDS. OTHER THAN THE SPECIAL TAXES LEVIED WITHIN THE DISTRICT, NO TAXES ARE PLEDGED TO THE PAYMENT OF THE 2003 BONDS. THE 2003 BONDS ARE NOT A GENERAL OBLIGATION OF THE AUTHORITY OR THE DISTRICT, BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM THE SOURCES PROVIDED 1N THE FISCAL AGENT AGREEMENT. This cover page contains certain information for quick reference only. It is not a summary of the issu~ Potential investors must read the entire Official Statement to obtain information essential to the making of an informed investment decision with respect to the 2003 Bonds. Investment in the 2003 Bonds involves risks which may not be appropriate for some investora See "BONDOWNERS' RISKS" herein for a discussion of special risk factors that should be considered in evaluating the investment qualitg of the 2003 Bonds. The 2003 Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Quint & Thimmig LLP, San Francisco, California, Bond Counsel, and subject to certain other conditions. McFarlin & Anderson LLP, Lake Forest, California is acting as Disclosure Counsel. Certain legal matters will be passed on for the Authority and the District by Richards, Watson & Gershon, Los Angeles, California, the City Attorney. Certain legal matiers will be passed on for the Lennar Homes of California, Inc. by Pillsbury Winthrop LLP, Los Angeles, California. in book-entry form, will be available for delivery to DTC in New York, New York on or about June 11, 2003. Stone & Youngberg l.I .C Dated: May ~, 2003 *Preliminary, subject to change. MATURITY SCHEDULE' TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS $ Serial Bonds Base CUSIP No. Mmurity Principal In~re~ CUSIP. Maturity (September 1) Amount Rate Price No. (September 1) 2005 $ % % 2014 2006 2015 2007 2016 2008 2017 2009 2018 2010 2019 2011 2020 2012 2021 2013 2022 Principal Interest CUSIP. Amount Rate Price No. $ % % $ % Term 2003 Bonds due September 1, 2033, Price % CUSIP No. The following language to be inserted by the printer, in red, at the top of the POS front cover: PRELIMINARY OFFICIAL STATEMENT DATED MAY ,2003 The following language to be inserted by the printer, in red, vertically along the left margin of the POS front cover: This Preliminary Official Statement and the information contained herein are subject to completion or amendment. Under no circumstances shall this Preliminary Official Statement constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. * Preliminary, subject to change. ** Copyright 2002, American Bankers Association. CUSIP data herein is provided by Standard & Poor's, CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. This data is not intended to create a database and does not serve in any way as a substitute for the CUSIP Services. TEMECULA PUBLIC FINANCING AUTHORITY BOARD OF DIRECTORS Jeff Stone, Chairperson Michael S. Naggar, Vice Chairperson Jeff Comerchero, Member Albert "Sam" Pratt, Member Ron Roberts, Member AUTHORITY STAFF Shawn Nelson, Executive Director and City Manager Genie Roberts, Authority Treasurer and City Finance Director Susan lones, Autl~ority Secretary and City Clerk SPECIAL SERVICES Bond Counsel Quint & Thimmig LLP San Francisco, California Authority Counsel Richards, Watson & Gershon A Professional Corporation Los Angeles, California Disclosure Counsel McFarlin & Anderson LLP Lake Forest, California Special Tax Consultant Albert A. Webb Associates Riverside, California Financial Advisor to the Authority Fieldman, Rolapp & Associates Irvine, California Fiscal Agent U.S. Bank National Association Los Angeles, California Appraiser Stephen G. White, MAI Fullerton, California Market Consultant Empire Economics, LLC Capistrano Beach, California NO DEALER, BROKER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION WITH RESPECT TO THE 2003 BONDS, OTHER THAN AS CONTAINED IN THIS OFFIC1AL STATEMENT, AND, IF GIVEN OR MADE, ANY SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE AUTHORITY, THE DISTRICT OR THE UNDERWRITER. THIS OFFICIAL STATEMENT DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN THOSE DESCRIBED ON THE COVER PAGE OR AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY OFFER, SOLICITATION OR SALE OF THE 2003 BONDS BY ANY PERSON IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER, SOLICITATION OR SALE. THIS OFFIC1AL STATEMENT IS NOT TO BE CONSTRUED AS A CONTRACT WITH THE PURCHASERS OF THE 2003 BONDS. Statements contained in this Official Statement which involve time estimates, forecasts or matters of opinion, whether or not expressly so described herein, are intended solely as such and are not to be construed as representations of fact. The information set forth herein has been furnished by the Authority, the District, or other sources which are believed to be reliable but it is not guaranteed as to accuracy or completeness. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. The information and expressions of opinion herein are subject to change without notice and neither the 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 any other entity described herein since the date hereof. This Official Statement is submitted in connection with the sale of securities referred to herein and may not be reproduced or be used, as a whole or in part, for any other purpose. IN CONNECTION WITH THE OFFERING OF THE 2003 BONDS, THE UNDERWRITER MAY OVERALLOT OR EFFECT TRANSACTIONS WHlCH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE 2003 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 2003 BONDS TO CERTAIN DEALERS AND DEALER BANKS AND BANKS ACTING AS AGENT AND OTHERS AT PRICES LOWER THAN THE PUBLIC OFFERING PR1CES STATED ON THE COVER PAGE HEREOF AND SAID PUBLIC OFFERING PRICES MAY BE CHANGED FROM TlME TO TIME BY THE UNDERWRITER. THE 2003 BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, 1N RELIANCE UPON AN EXEMPTION CONTAINED IN SUCH ACT. THE 2003 BONDS HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE. TABLE OF CONTENTS Page INTRODUCTION ................................................................... 1 General ..................................................................... 1 The Authority ................................................................ 1 The Community Facilities District ................................................ 1 Purpose of the 2003 Bonds ...................................................... 2 Sources of Paymem £or the 2003 Bonds ............................................ 2 Appraisal .................................................................... 3 Tax Exemption ............................................................... 4 Risk Factors Associated with Purchasing the 2003 Bonds .............................. 4 Forward Looking Statements .................................................... 4 Professionals Involved in the Offering ............................................. 4 Other Information ............................................................. 5 CONTINUING DISCLOSURE ........................................................ 5 PLAN OF FINANCE; IMPROVEMENTS TO BE FINANCED WITH PROCEEDS OF THE 2003 BONDS ........................................ 6 ESTIMATED SOURCES AND USES OF FUNDS ......................................... 7 THE 2003 BONDS .................................................................. 7 Description of the 2003 Bonds ................................................... 7 Debt Service Schedule ......................................................... 9 Terms of Redemption .......................................................... 9 Transfer and Exchange of Bonds ................................................ 11 Book-Entry and DTC ......................................................... 12 SECURITY FOR THE 2003 BONDS ................................................... 12 General .................................................................... 12 Special Taxes ............................................................... 12 Rate and Method ............................................................. 13 Special Taxes and the Teeter Plan ............................................... 16 Proceeds of Foreclosure Sales ................................................... 16 Special Tax Fund ............................................................ 17 Bond Fund .................................................................. 17 Administrative Expense Fund ................................................... 18 Investment of Moneys in Funds ................................................. 18 Rebate Requirement .......................................................... 18 Additional Bonds for Refunding Purposes Only .................................... 18 THE AUTHORITY ................................................................. 19 Authority for Issuance ......................................................... 19 THE COMMUNITY FACILITIES DISTRICT ............................................ 20 Location and Description of the District ........................................... 20 Specific Plan ................................................................ 20 Environmental Conditions ..................................................... 20 Other Matters ............................................................... 21 Acquisition of Improvements ................................................... 21 Property Ownership .......................................................... 22 Estimated Special Tax Allocation by Property Ownership ............................. 40 Direct and Overlapping Debt ................................................... 40 Overlapping Assessment and Community Facilities Districts .......................... 43 OtherO 1;_venapping Direct Assessments ........................................... 43 Transportation Uniform Mitigation Fee ........................................... 43 Estimated Assessed Value-to-Lien Ratios ......................................... 44 Market Absorption Study ...................................................... 44 Appraised Property Value ...................................................... 46 BONDOWNERS' RISKS ............................................................ 47 -i- Risks of Real Estate Secured Investments Generally ................................. 47 Concentration of Ownership .................................................... 47 Failure to Develop Properties ................................................... 47 Special Taxes Are Not Personal Obligations ....................................... 48 The 2003 Bonds Are Limited Obligations of the District .............................. 48 Appraised Values ............................................................ 48 Land Development ........................................................... 49 Burden of Parity Lians, Taxes and Other Special Assessments on the Taxable Property ..... 49 Disclosure to Future Purchasers ................................................. 50 Government Approvals ........................................................ 50 Local, State and Federal Land Use Regulations ..................................... 50 Endangered and Threatened Species .............................................. 50 Hazaraousard~ Substances ......................................................... 50 Levy and Collection of the Special Tax ........................................... 51 Exempt Properties ............................................................ 53 Depletion o_Reservef Fund ..................................................... 53 Potential Delay and Limitations in Foreclosure Proceedings ........................... 53 Bankruptcy and Foreclosure Delay ............................................... 54 Payments oy FDIC and Other Faneral Agencies .................................... 55 Payment of Special Tax Not a Personal Obligation of the Property Owners ............... 56 Factors Affecting Parcel Values and Aggregate Value ................................ 56 No Acceleration Provisions .................................................... 56 Community Facilities District Formation .......................................... 56 Billing of Special Taxes ....................................................... 57 Collection of Special Tax ...................................................... 57 Right to Vote on Taxes Act ..................................................... 57 Ballot Initiatives and Legislative Measures ........................................ 58 Limited Secondary Market ..................................................... 58 Loss of Tax Exemption ........................................................ 58 Limitations on Remedies ...................................................... 59 LEGAL MATTERS ................................................................. 59 Legal Opinion ............................................................... 59 Tax Exemption .............................................................. 59 No Litigation ................................................................ 59 NO RATINGS ..................................................................... 60 UNDERWRITING .................................................................. 60 PROFESSIONAL FEES ............................................................. 60 MISCELLANEOUS ................................................................ 60 APPENDIX A - APPENDIX B - APPENDIX C - APPENDIX D - APPENDIX E - APPENDIX F APPENDIX G - APPENDIX H - APPENDIX l General Information About the City of Temecula ......................... A-I Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Rate and Method of Apportionment of Special Tax ....... B-1 Summary Appraisal Report .......................................... C-I Summary Market Absorption Study ................................... C-1 Summary of Certain Provisions of the Fiscal Agent Agreement ............. D-I Form of Community Facilities District Continuing Disclosure Agreement ..... E-I Forms of Developer Continuing Disclosure Agreements .................... F-1 Form of Opinion of Bond Counsel .................................... G-I Book-Entry System ................................................ H-I -ii- BOUNDARY MAP AERIAL MAP [Regional Map to be provided by Stone & Youngberg LLC.] -ii- OFFICIAL STATEMENT $18,000,000' TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX 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. A full review should be made of the entire Official Statement. The offering of the 2003 Bonds to potential investors is made only by means of the entire Official Statement. General This Official Statement, including the cover page and appendices hereto, is provided to furnish information regarding the issuance and sale by the Temecula Pubhc Financing Authority (the "Authority"), on behalf of the Temecula Public. Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") of $18,000,000 aggregate principal amount of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "2003 Bonds"). The 2003 Bonds are issued pursuant to the Act (as defined below) and a Fiscal Agent Agreement, dated as of June 1, 2003 (the "Fiscal Agent Agreement"), by and between the Authority, for and on behalf of the District, and U.S. Bank National Association, as Fiscal Agent (the "Fiscal Agent"). See "THE AUTHORITY - Authority for Issuance" herein. The Authority may issue additional bonds secured under the Fiscal Agent Agreement on a parity with the 2003 Bonds for refunding purposes only. "Bonds" means the 2003 Bonds and any such Panty Bonds, as defined herein (collectively, the "Bonds"). Capitalized terms used in this Official Statement and not otherwise defined heroin have the meanings given such terms in the Fiscal Agent Agreement, some of which are set forth in Exhibit E hereto "Summary of Certain Provisions of the Fiscal Agent Agreement." The Authority The Authority was formed on April 10, 2001, pursuant to a Joint Exercise of Powers Agreement between the City of Temecula, California (the "City") and the Redevelopment Agency of the City of Temecula, in accordance with Articles I through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title 1 of the Government Code of the State of California. See "THE COMMUNITY FACILITIES DISTRICT - General Information" and "THE AUTHORITY." The Community Facilities District The District was formed and established by the Board of Directors of the Authority on March 25, 2003 pursuant to the Mello-Roos Community Facilities Act of 19,~2, .,a,s, amended (Section 53311 et seq. of the California Government Code, and referred to herein as the Act ), following a public hearing and a landowner election at which the qualified electors of the District, by more than a two-thirds vote, authorized the District to incur bonded indebtedness in the aggregate not-to-exceed amount of $25,000,000 and approved the levy of special taxes (the "Special Taxes") on certain real property located in the District. Once duly established, a community facilities district is a legally constituted governmental entity established for the purpose of financing specific facilities and services within defined boundaries. Subject to approval by a two-thirds vote of the qualified voters within a community facilities district and compliance with the provisions of the Act, a community facilities district may issue bonds and may levy and collect special taxes to repay such bonded indebtedness and interest thereon. *Prelimina~, subject to change. The District is contiguous and is comprised of approximately [272.06] net acres of primarily undeveloped land located on the east side of the City, in the south-westerly portion of the County of Riverside (the "County"). The District lies within the area of the master-planned community known as "Crowne Hill" and is part of the specific plan area known as "Butterfield Stage Ranch" (Specific Plan 226) (the "Butterfield Stage Ranch Specific Plan") adopted by the County in 1987. (The City was not incorporated at that time.) The District is bounded generally on the west by Butterfield Stage Road, on the north by Pauba Road and on the south by Route 79. The District consists of approximately 796 units of an approximately t 049 residential unit master-planned community. Included within the master-planned community (but not within the boundaries of the District) is a proposed approximately [1 l-]acre school site, two neighborhood park sites (3.5 acres and 5.2 acres, respectively), plus many other open spaced/greenbelt/slope areas and five private homeownerpark sites. Approximately 249 lots at the southerly end of the master-planned community are occupied and are not part of the District. There are five major landowners within the District: (i) LENOne, Inc., a Virginia corporation ("LENOne") which owns 439 lots (approximately net acres) of which 114 lots are identified by the Lennar Entities (as defined below) as relating to U.S~-me, Inc., a California corporation ("US Home") and 325 lots are identified by the Lennar Entities as relating to Greystone Homes, Inc., a California corporation ("Greystone Homes"); (ii) Greystone Homes which owns 17 lots; (iii) KB Home Coastal, Inc., a California corporation ("KB Home Coastal") which owns 212 lots (approximately 51.98 net acres) in two tracts; (iv) PCC III - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100") which owns 100 single family residential lots (approximately net acres) for which Lennar Homes of California, Inc. a California corporation ("Lennar Homes") is the-'~"~rchant builder and (v) PCC III - Crowne Hill LLC, a Delaware limited liability company ("PCC III") which owns 28 custom estate lots (approximately net acres) for which Pacific Century Homes, Inc., a California corporation ("Pacific Century Homes") act~ the developer for the construction, or sale to others for construction, of the custom homes. For purposes hereof the term "Lennar Entities" includes Lennar Communities, US Home, Greystone Homes and Lennar Homes, and the term "Lennar Merchant Builders" includes US Home, Greystone Homes and Lennar Homes. See "PROPERTY OWNERSHIP AND DEVELOPMENT -- The Major Property Owners." Purpose of the 2003 Bonds The 2003 Bonds are being issued (i) to finance, either directly or indirectly, the acquisition and construction of certain street and signal improvements, storm drain improvements, sewer and water improvements, fire protection improvements and park and recreation improvements (collectively the "Improvements") to be located within or in the vicinity of the District (ii) to eliminate an existing special assessment lien (the "Prior Lien") on parcels in the District, (iii) to pay interest on the 2003 Bonds through September 1, 2003, (iv) to pay certain administrative expenses of the District, (v) to pay the costs of issuing the 2003 Bonds and (vi) to establish a Reserve Fund for the 2003 Bonds. See "PLAN OF FINANCE; IMPROVEMENTS TO BE FINANCED WITH PROCEEDS OF THE 2003 BONDS" herein. Sources of Payment for the 2003 Bonds The 2003 Bonds are secured by andpayable from a first pledge of"Special Tax Revenues," defined in the Fiscal Agent Agreement as the proceeds of the Special Taxes received by the Authority, including any scheduled payments thereof and any prepayments thereof, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Special Taxes to the amount of said lien and interest thereon. "Special Tax Revenues" does not include any penalties collected in connection with delinquent Special Taxes which amounts may be forgiven or disposed of by the Authority in its discretion, and if collected, will be used in a manner consistent with the Act. "Special Taxes" are defined in the Fiscal Agent Agreement as the special taxes levied within the District pursuant to the Act the ordinance adopted by the legislative body of the District providing for the levy of the Special Taxes and the Fiscal Agent Agreement. The, Special Taxes ~,e, levied in accordance with the Rate and Method of Apportionment of Special Tax (the Rate and Method ) recorded as a lien on the Property pursuant to the Notice of Special Tax Lten. Pursuant to the Act, the Rate and Method, the Resolution of Formation (as defined herein) and the Fiscal Agent Agreement, so long as any 2003 Bonds are outstanding, the Authority will annually levy the Special Tax against the land within the District not exempt from Special Taxes under the Act and the Rate and Method ("Taxable Property") in accordance with the proceedings for the authorization and issuance of the 2003 Bonds and with the Rate and Method, to make provision for the collection of the Special Tax in amounts which will be sufficient to (a)(i) pay debt service on all 2003 Bonds, if any, for the calendar year that commences in such Fiscal Year, (ii) pay periodic costs on the 2003 Bonds, including but not limited to, credit enhancement, liquidity support and rebate payments on the 2003 Bonds; (iii) pay Administrative Expenses; and (iv) pay any amounts required to establish or replenish any bond or interest rate reserve funds for any Outstanding Bonds; less (b) a credit for funds available to reduce the annual Special Tax levy under the Fiscal Agent Agreement. See "SECURITY FOR THE 2003 BONDS - Special Taxes and the Teeter Plan" herein. The Rate and Method establishes two zones within the District. Zone 1 encompasses the lots not owned by KB Home Coastal. Zone 2 encompasses the lots owned by KB Home Coastal. The Rate and Method exempts from the Special Tax up to 93.41 acres of Public Property and/or Property Owner Association Property within Zone t of the District and up to 30.43 acres of Public Property and/or Property Owner's Association Property within Zone 2 of the District. See "SECURITY FOR THE 2003 BONDS - Rate and Method" and "BONDOWNERS' RISKS - Exempt Properties." The Authority has also covenanted in the Fiscal Agent Agreement to cause foreclosure proceedings to be commenced and prosecuted against certain parcels with del!,n, quent installments of the Special Tax. For a more detailed description o,f, the foreclosure covenant, see SECURITY FOR THE 2003 BONDS - Proceeds of Foreclosure Sales.' NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE AUTHORITY, THE DISTRICT (EXCEPT TO THE LIMITED EXTENT DESCRIBED HEREIN) OR THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE 2003 BONDS. OTHER THAN THE SPECIAL TAXES OF THE DISTRICT, NO TAXES ARE PLEDGED TO THE PAYMENT OF THE 2003 BONDS. THE 2003 BONDS ARE NOT A GENERAL OBLIGATION OF THE AUTHORITY OR THE DISTRICT, BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM THE SOURCES PROVIDED IN THE FISCAL AGENT AGREEMENT. Appraisal An appraisal prepared by an MAI appraiser of the land and existing improvements for the development within the District dated March 19, 2003 (the "Appraisal"), has been prepared by Stephen G. White, MAI of Fullerton, California (the "Appraiser") in connection with issuance of the 2003 Bonds. The purpose of the appraisal was to estimate the market value of each of the 8 tracts, reflecting the as is condition of the lots within each tract, as well as the homes which are completed or under construction. The Appraisal also incorporates the proposed District financing together with the overall tax rate to future homeowners of approximately 1.8 to 1.9%, including the Special Taxes. The subject property includes property proposed for development of 796 single family residential lots. The Appraisal is based on certain assumptions. Subject to these assumptions, the Appraiser estimated that the fee simple market value of the Taxable Property within .the District (subject to the lien of the Special Taxes) as of March 15, 2003, was as follows: Tract Name Builder No. of Lots Market Value Stratford US Home 114 $12,460,000 Nottingham Greystone Homes 119 12,860,000 Astoria Greystone Homes 111 t 3,000,000 Carlyle Lennar Homes 100 9,630,000 Fairmont Greystone Homes 112 10,920,000 Knightsbridge KB Home Coastal 127 13,880,000 Hampton KB Home Coastal 85 10,980,000 Estate Lots Pacific Century Homes 28 4,790,000 796 $88,520,000 The fee simple market value includes the value ofgradingand infrastructure improvements completed as of the date of value and the improvements to be financed by the 2003 Bonds. The market values reported in the Appraisal result in an estimated value-to-lien ratio of 4.9:1, calculated with respect to the 2003 Bonds and excluding the overlapping assessment debt relating to the Prior ,,L?n. The value-to-lien ratios of individual parcels will differ from the foregoing aggregate value. See THE BONDOWNERS' RISKS - Burden of Parity Liens, Taxes and Other Special Assessments on the Taxable Property" and "BONDOWNERS' RISKS - Appraised Values" herein and APPENDIX C - "Summary Appraisal Report" appended hereto for further information on the Appraisal and for limiting conditions relating to the Appraisal. Tax Exemption Assuming compliance with certain covenants and provisions of the Internal Revenue Code of 1986, in the opinion of Bond Counsel, interest on the 2003 Bonds will not be includable in gross income for federal income tax purposes although it may be includable in the calculation for certain taxes. Also in the opinion of Bond Counsel, interest on the 2003 Bonds will he exempt from State personal income taxes. See "LEGAL MATTERS - Tax Exemption" herein. Risk Factors Associated with Purchasing the 2003 Bonds Investment in the 2003 Bonds involves risks that may not be appropriate for some investors. See the section of this Official Statement entitled "BONDOWNERS' RISKS" for a discussion of certain risk factors which should be considered, in addition to the other matters set forth herein, in considering the investment quality of the 2003 Bonds. Forward Looking Statements Certain statements included or incorporated by reference in this Official Statement constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as a"plan," "expect," "estimate ""project ""budget" or similar words. Such forward- looking statements include, but are not limited to certain statements contained in the information under the caption "THE COMMUNITY FACILITIES DISTRICT - Property Ownership" therein. THE ACHIEVEMENT OF CERTAIN RESULTS OR OTHER EXPECTATIONS CONTAINED IN SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS DESCRIBED TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH FORWARD-LOOKING STATEMENTS. NEITHER THE AUTHORITY NOR THE DISTRICT PLANS TO ISSUE ANY UPDATES OR REVISIONS TO THE FORWARD-LOOKING STATEMENTS SET FORTH IN THIS OFFICIAL STATEMENT. Professionals Involved in the Offering U.S. Bank National Association, Los Angeles, California, will serve as the paying agent, registrar, authentication and transfer agent, and dissemination agent for the 2003 Bonds and will perform the functions required of it under the Fiscal Agent Al~reement for the payment of the principal of and interest and any premium on the 2003 Bonds and all activtties related to the redemption of the 2003 Bonds. Quint & Thimmig LLP, San Francisco, California is serving as Bond Counsel to the Authority. McFarlin & Anderson LLP Lake Forest, California, is acting as Disclosure Counsel to the Authority. Pillsbury Winthrop LLP, Los Angeles, California, is acting as counsel to Lennar Homes. [Describe counsel for other Lennar Entities, if needed and for KB Home Coastal.] Albert A. Webb Associates, Riverside, California, acted as special tax consultant to the District. Fieldman, Rolapp and Associates, Irvine, California, acted as Financial Advisor to the Authority. The appraisal work was done by Stephen G. White, MAI of Fullerton, California. Empire Economics, LLC, San Juan Capistrano, Califomia, acted as Absorption Consultant. Payment of the fees and expenses of Bond Counsel, Disclosure Counsel, the Fiscal Agent and the Underwriter, and of a portion of the fees and expenses of the Financial Advisor and the Special Tax Consultant, is contingent upon the sale and delivery of the Bonds. Other Information This Official Statement speaks only as of its date, and the information contained herein is subject to change. Brief descriptions of the 2003 Bonds, certain sections of the Fiscal Agent Agreement, security for the 2003 Bonds, special risk factors, the Authority, the District, the Lennar Merchant Builders, KB Home Coastal, PCC Ill, information regarding the development plan for the property owned by the Lennar Merchant Builders, KB Home Coastal, PCC lII and other information are included in this Official Statement. Such descriptions and information do not purport to be comprehensive or definitive. The descriptions herein of the 2003 Bonds, the Fiscal Agent Agreement, and other resolutions and documents are qualified in their entirety by reference to the complete texts of the 2003 Bonds, the Fiscal Agent Agreement, such resolutions and other documents. All such descriptions are further qualified in their entirety by reference to laws and to principles of equity relating to or affecting generally the enforcement of creditors' rights. Copies of such documents may be obtained upon written request from the Temecula Public Financing Authority, 43200 Business Park Drive, Temecula, California 92590 Attention: Treasurer. The Authority may charge for copying and mailing any documents requested. CONTINUING DISCLOSURE The Authority. The Authority has covenanted for the benefit of the Owners of the 2003 Bonds to provide annually certain financial information and operating, data relating to the 2003 Bonds the District ownership and development of the property in the District wNch is subject to the Special Tax, the occurrence of delinquencies in payment of the Special Tax, and the status of foreclosure proceedings, if any, respecting Special Tax delinquencies (the "Authority Annual Report"), and toprovide notice of the occurrence of certain enumerated events, if material. Such information is to be provided by the Authority not later than ei~h.t months after the end of the A uthority's fiscal year (which currently would be March 1), commencing w~th the reports for the 2002-03 fiscal year. The Authority has a recent undertakin~ with regard to Securities and Exchange Commission Rule 15c2-12(b)(5) but the annual report is not reqmred to be filed until March 1, 2004. The Authority, the Cit~ and related entities have never failed to comply in all material respects with any previous undertakings w~th regard to said Rule to provide annual reports or notices of material events. Lennar Homes andKB Home Coastal. Lennar Homes and KB Home Coastal have each covenanted for the benefit of the Owners of the 2003 Bonds to provide semi-annually certain financial information and information regarding the development of the property owned by each of them, or their Affiliates (as defined below) in the District (each a "Developer Semi-Annual Report"), and to provide notice of the occurrence of certain enumerated events, if material. Such information is to be provided not later than three and one half months after the end of each such merchant builder's fiscal year (November 30 for Lennar Homes and November 30 for KB Home Coastal, which for the fiscal year ending November 30 would be February 15 of the following year) and not later than nine and one half months after the end of each such merchant builder' s fiscal year (August 15 ), commencing with the report due not later than February 15, 2004 for Lennar Homes and February 15, 2004 for KB Home Coastal. In connection with covenants relating to a 1998 financing for a project in the City of Temecula by the Winchester Hills Financing Authority Community Facilities District No. 98-1 (Winchester Hills) in which Lennar Homes was involved as the administrative member of the major landowner, Lennar Homes, as the administrative member, filed audited financial statements for each fiscal year through its 1999 fiscal year (the report filed in May 2000) but did not file the report due for the 2000 fiscal year and did not include financial information regarding the development of the property owned by Lennar Communities in the 1999 report. In connection with covenants relating to a [2000] financing for a project in the City of {Murrieta] by the Murrieta Valley Unified School District Community Facilities District No. 2000-1, Greystone Homes, [as successor to Pacific Century Homes J failed to provide the continuing disclosure reports due on on a timely basis. A consultant to Greystone Homes prepared the continuing disclosure report an~filed in [April]2003. Lennar Homes manner to comply with any previous undertaking. Filing of District Annual Reports and Lennar Homes and KB Home Coastal Semi-Annual Reports; Form of Reports. Each Annual Report will be filed by the Fiscal Agent as dissemination agent, witheach Nationally Recognized Municipal Securities Information Repository and with each State Repository, if any. These covenants have been made in order to assist the Underwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5); provided, however, a defaull under a Developer Continuing Disclosure Agreement will not, in itself, constitute an Event of Default under the Fiscal Agent Agreement and the sole remedy under each Deve oper Continuing Disclosure Agreement in the event of any failure of Lennar Homes or KB Home Coastal or the Dissemination Agent to comply with a Developer Continuing Disclosure Agreement will be an action to compel performance. Lennar Homes and KB Home Coastal's continuing disclosure obligations will terminate upon the occurrence of certain events, including when each such merchant builder (and its Affiliates' property) is subject to less than 15% of the Special Tax levy of the District for the then current Fiscal Year. Based on the estimated absorption and estimated sales of property provided by KB Home Coastal, such date is estimated to occur by the end of 2003 and the last Semi-Annual Report of KB Home Coastal is estimated to be provided by Februa~ 15, 2004, with a filing under its Developer Continuing Disclosure Agreement that KB Home Coastal has no further disclosure obligations under its Developer Continuing Disclosure Agreement. For a complete listing of items of information which will be provided in the Authority Annual Report and the Developer Semi-Annual Report, see APPENDIX G - "Forms of Developer Continuing Disclosure Agreements." PLAN OF FINANCE; IMPROVEMENTS TO BE FINANCED WITH PROCEEDS OF THE 2003 BONDS Acquisition or Construction of Improvements. Proceeds of the 2003 Bonds in the amount of .$, will be applied to acquire or construct certain street and signal improvements, storm drain improvements, sewer and water improvements, fire protection improvements and park and recreation improvements (collectively, the "Improvements") to be constructed within or in the vicinity of the District. In addition, proceeds in the amount of $2,922,382.44 will be applied to prepay the Prior Lien. For a list of the Improvements, see "THE COMMUNITY FACILITIES DISTRICT - Acquisition or Construction of Improvements." The balance of the proceeds of the 2003 Bonds will be used (i) to eliminate the Prior Lien (ii) to pay interest on the 2003 Bonds through September 1, 2003, (iii) to pay certain administrative expenses of the District, (iv) to pay the costs of issuing the 2003 Bonds and (v) to establish a Reserve Fund for the 2003 Bonds. The Authority has entered into a Joint Community Facilities Agreement between the Authority and the City whereby the City agrees to accept dedication of facilities financed by the District. The Authority has entered into an Acquisition Agreement between the Authority and Lennar Homes providing for the acquisition by the Authority from Lennar Homes of certain public facilities. The Authority has entered into a Joint Community Facihties Agreement among the Authority, the Eastern Municipal Water District ("EMWD"), and Lermar Homes pursuant to which EMWD will accept certain completed sewer facilities financed by the District. The Authority has entered into a Joint Community Facilities Agreement among the Authority, the Rancho California Water District, and Lennar Homes, pumuant to which Rancho California Water District will accept certain completed water facilities financed by the District. The Authority has entered into a Joint,~omm.u,,,nity Facilities Agreement between the Authority and the California Department of Transportation ( CDOT ), pursuant to which the CDOT will accept certain completed facilities financed by the District. ESTIMATED SOURCES AND USES OF FUNDS The proceeds from the sale of the 2003 Bonds will be deposited into the following respective accounts and funds established by the Authority under the Fiscal Agent Agreement, as follows: SOURCES Principal Amount of 2003 Bonds Less: Underwriter's Discount Total Sources $ ( $ USES Deposit into Improvement Fund~') Deposit into Reserve Fund Deposit into Capitalized Interest Subaccount of the Bond FundI2) Deposit into Administrative Expense Fund Deposit into Cost of Issuance Fund°) Total Uses $ See "PLAN OF FINANCE; IMPROVEMENTS TO BE FiNANCED WITH PROCEEDS OF THE 2003 BONDS"above. Represents gross funded capitalized interest through September 1 2003. Includes, among other things, the fees and expenses of Bond Counsel, Disclosure Counsel, the financial advisor, the Special Tax Consultant and the Fiscal Agent, the cost of printing the Preliminary and final Official Statements and reimbursement to the District and Lennar Homes for costs advanced towards the issuance of Bonds and the formation of the District. THE 2003 BONDS Description of the 2003 Bonds The 2003 Bonds will be dated their date of delivery and will bear interest at the rates per annum set forth on the cover page hereof, payable semiannually on each March 1 and September 1, commencing on September 1, 2003 (each, an "Interest Payment Date"), and will mature in the amounts and on the dates set forth on the inside cover page hereof. The 2003 Bonds will be issued in full~, registered form in denominations of $5,000 each or any integral multiple thereof and when delivered, wall be registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York. DTC will act as securities depository for the 2003 Bonds. Ownership interests in the 2003 Bonds may be purchased in book-entry form only, in denominations of $5 000 or any integral multiple thereof within a single maturity. So long as the 2003 Bonds are held in book-entry form, principal of, premium, if any, and interest on the 2003 Bonds will be paid directly to DTC for distribution to the beneficial owners of the 2003 Bonds in accordance with the procedures adopted by DTC. See "THE 2003 BONDS - Book-Entry and DTC.' The 2003 Bonds will bear interest at the rates set forth on the cover hereof payable on the Interest Payment Dates in each year. Interest will be calculated on the basis of a 360-day year comprised of twelve 30-day months. Each 2003 Bond shall bear interest from the March I or September 1 (each an "Interest Payment Date") next preceding the date of authentication thereof unless (i) it is authenticated on an Interest Payment Date, in which event ~t shall bear interest from such date of authentication, or (ii) it is authenticated prtor to an Interest Payment Date and after the close of business on the Record Date (as defined below) precedinl~ such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it ~s authenticated prior to the Record Date preceding the first Interest Payment Date in which event it sba bear interest from the Bond Date; provided, however, that if at the time of authentication of a Bond, *Preliminary, subject to change. 7 interest is in default thereon, such Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. The principal of, and interest and premium, if any, payable on the 2003 Bonds shall be payable when due, by wire transfer of the Fiscal Agent, to The Depository Trust Company, New York, New York ("DTC"), which will in turn remit such principal, interest and premium, if any, to its Participants (as described in APPENDIX I - "Book-Entry System"), which Participants will in turn remit such principal, interest and premium, if any, to the Beneficial Owners (as defined in APPENDIX 1 - "Book-Entry System") of the 2003 Bonds as described below under APPENDIX I - "Book-Entry System." In the event that the 2003 Bonds are not registered in the name of Cede & Co., as nominee of DTC or another eligible depository as described below, both the principal and redemption price including any premium, of the 2003 Bonds shall be payable by check in lawful money of the United States of America upon presentation of the 2003 Bonds at the principal office of the Fiscal Agent as specified in the Fiscal Agent Agreement. Interest on the 2003 Bonds (including the final interest payment upon maturity or earlier redemption) is payable by check of the Fiscal Agent mailed on the Interest Payment Dates by first class mail to the registered Owner thereof at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer (i) to DTC (so long as the 2003 Bonds are in book-entry form pursuant to the Fiscal Agent Agreement, or (ii) to an account within the United States made on such Interest Payment Date upon written instructions of any Owner of $1,000,000 or more in aggregate principal amount of 2003 Bonds received before the applicable Record Date, which instructions shall continue in effect until revoked in writing, or until such 2003 Bonds are transferred to a new Owner. The 2003 Bonds are issuable only as fully registered Bonds without coupons in denominations of $5,000 or any integral multiple of $5,000 in excess thereof. The registered owner of any 2003 Bond will be the person or persons in whose name or names a 2003 Bond is registered on the registration books kept for that purpose by the Fiscal Agent in accordance with the terms of the Fiscal Agent Agreement. The "Record Date" with respect to any 2003 Bonds, means the fifteenth day of the month next preceding the month of the applicable Interest Payment Date, whether or not such day is a Business Day. So long as the 2003 Bonds are in book-entry only form, all references in this Official Statement to the owners or holders of the 2003 Bonds means DTC and not the Beneficial Owners. Debt Serviee Schedule The following table presents the annual debt service on the 2003 Bonds (including sinking fund redemptions), assuming that ti~ere are no optional redemptions or mandatory redemptions from special taxes. Year Ending Total September I Principal Interest Debt Service 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 $ $ $ $ $ Terms of Redemption The 2003 Bonds arc subject to redemption upon the circumstances, on the dates and at the prices set forth as follows. Optional Redemption.* The 2003 Bonds maturing on or after September 1, 2013 are subject to optional redemption prior to their stated maturity on any Interest Payment Date on or after September 1, 2012, as a whole or in part, among maturities so as to maintain substantially level debt service and by lot within a maturity, at a redemption price (expressed as a percentage of the principal amount of the 2003 Bonds to be redeemed), as set forth below, together with accrued interest thereon to the date fixed for redemption: *Preliminary, subject to change. 9 Redemption Date September 1, 2012 through March 1, 2013 September 1, 2013 and any Interest Payment Date thereafter Redemption Price 102% 100 Mandatory Sinking Payment Redemption. The 2003 Bonds maturing on September 1, , are subject to mandatory sinking payment redemption in part on September 1, , and on each Sep~er 1 thereafter to maturity, by lot, at a redemptionprice equal to the principal amount there&to be redeemed, together with accrued interest to the date fixedfor redemption, without premium, from sinking payments as follows: Redemption Date Sinking Payments (maturity) The 2003 Bonds maturing on September 1, 2033, are subject to mandatory sinking payment redemption in part on September 1, , and on each September I thereafter to maturity, by lot, at a redemption price equal to the principaI-~-ount thereof to be redeemed, together with accrued interest to the date fixed for redemption, without premium, from sinking payments as follows: Sinking Fund Redemption Date Sinking Payments $ 2033 (maturity) The amounts in the foregoing tables shall be reduced to the extent practicable so as to maintain level debt service on the 2003 Bonds as a result of any prior partial redemption of the 2003 Bonds pursuant to an optional redemption or mandatory redemption from prepaid Special Taxes as specified in writing by the Treasurer to the Fiscal Agent. Redemption from Special Tax Prepayments. Special Tax Prepayments and any corresponding transfers from the Reserve Fund shall be used to redeem the 2003 Bonds on the next Interest Payment Date for which notice of redemption can timely be given, by lot and allocated among maturities of the 2003 Bonds so as to maintain substantially level debt service on the 2003 Bonds, at a redemption price (expressed as a percentage at the principal amount of the 2003 Bonds to be redeemed), as set forth below, together with accrued ~nterest to the date fixed for redemption: Redemption Date Redemption Price Any Interest Payment Date from September 1, 102% 2003 to and include March 1, 2013 September 1, 2013 and any Interest Payment 100 Date thereafter Purchase In Lieu of Redemption. In lieu of any redemption, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of Outstanding 2003 Bonds, upon the filingwith the Fiscal Agent of an officer's certificate requesting such purchase, at public or private sale as and when, and at such 10 prices (including brokerage and other charges) as such officer's certificate may provide, but in no event may Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase and any premium which would otherwise be due if such 2003 Bonds were to be redeemed in accordance with the Fiscal Agent Agreement Notice of Redemption. The Fiscal Agent shall cause notice of any redemption to be mailed by first class mail, postage prepaid, at least thirty (30) days but not more than sixty (60) days prior to the date fixed for redemption, to the Underwriter, to the Securities Depositories, to one or more Information Services, and to the respective registered Owners of any 2003 Bonds designated for redemption, at their addresses appearing on the Bond registration books in the principal office of the Fiscal Agent; but such mailing shall not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, shall not affect the validity of the proceedings for the redemption of such Bonds. Such notice shall state the redemption date and the redemption price and, if less than all of the then Outstanding 2003 Bonds are to be called for redemption, shall designate the CUSIP numbem and Bond numbers of the 2003 Bonds to be redeemed by giving the individual CUSIP number and Bond number of each 2003 Bond to be redeemed or shall state that all 2003 Bonds between two stated Bond numbers, both inclusive, are to be redeemed or that all of the 2003 Bonds of one or more maturities have been called for redemption, shall state as to any 2003 Bond called inpart the principal amount thereof to be redeemed, and shall require that such 2003 Bonds be then surrendered at the principal office of the Fiscal Agent for redemption at the said redemption price, and shall state that further interest on such 2003 Bonds will not accrue from and after the redemption date. Partial Redemption. Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all of the Bonds or any given portion thereof, the Fiscal Agent shall select the Bonds to be redeemed, from all Bonds or such given portion thereof not p~reviously called for redemption, among maturities as directed in writing by the Treasurer (who shall specify Bonds to be redeemed so as to maintain, as much as practicable, the same debt service profile for the Bonds as in effect prior to such redemption unless otherwise specified herein), and by lot within a maturity in any manner which the Fiscal Agent deems appropriate. Upon surrender of Bonds redeemed in part only, the Authority shall execute and the Fiscal Agent shall authenticate and deliver to the registered Owner, at the expense of the Authority, a new Bond or Bonds, of the same series and maturity, of authorized denominations in aggregate principal amount equal to the unredeemed portion of the Bond or Bonds. Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2003 Bonds so called for redemption shall have been deposited in the Bond Fund, such 2003 Bonds so called shall cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or a~er the redemption date specified in such notice. Transfer and Exchange of Bonds Any 2003 Bond may, in accordance with the terms of the Fiscal Agent Agreement, be transferred upon the books of the Fiscal Agent, required to be keptpursuant to the Fiscal Agent Agreement by the person in whose name it is registered, in pemon or by h~s duly authorized attorney, upon surrender of such 2003 Bond for cancellation, accompanied by delivery of a written instrument of transfer in a form acceptable to the Fiscal Agent. 2003 Bonds may be exchanged at the principal office of the Fiscal Agent for a like aggre.gate principal amount of 2003 Bonds of authorized denominations and of the same series and maturity. The F~scalAgent shall collect from the Owner requesting such exchange any tax or other governmental charge required to be paid with respect to such transfer or exchange, [and may, in connection with any exchange, collect a charge equal to a customary fee charged by the F~scal Agent for such exchange, but any such transfer or exchange shall otherwise be made without charge to the Bondowner requesting the same.] No transfer or exchange shall be required to be made of any 2003 Bonds (i) fifteen days prior to the date established by the Fiscal Agent for selection of Bonds for redemption, (ii) with respect to a Bond after such Bond has been selected for redemption, or (iii) between a Record Date and the succeeding Interest Payment Date. Book-Entry and DTC 11 The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the 2003 Bonds., The 2003 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 2003 Bond certificate will be issued for each maturity of the 2003 Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC. All references in this Official Statement to the Bondowners or an owner of 2003 Bonds shall mean DTC or its designee and not the beneficial owners of the 2003 Bonds. See APPENDIX I - "Book-Entry System." SECURITY FOR THE 2003 BONDS General The Bonds are secured by a pledge of all of the Special Tax Revenues and, until disbursed as provided in the Fiscal Agent Agreement, in the Special Tax Fund. The 2003 Bonds will also be secured by moneys deposited in the Reserve Fund. Pursuant to the Act and the Fiscal Agent Agreement, the Authority will annually levy in each Fiscal Year the Special Taxes in an amount recruited for the payment of principal of and interest on any outstanding Bonds becoming due and payable dunng the calendar year commencing in each Fiscal Year, including any necess.a~ replenishment of Reserve Fund for 2003 Bonds and an amount estimated to be sufficient to pay the Administrative Expenses during such year. The Special Tax Revenues and all deposits into said funds (until disbursed as provided in the Fiscal Agent Agreement) are pledged to the payment of the principal of, and interest and any premium on, the Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities (as defined in the Fiscal Agent Agreement) have been set aside irrevocably for that purpose. Amounts in the Administrative Expense Fund, the Cost of Issuance Fund, and the Improvement Fund are not pledged to the repayment of the 2003 Bonds. The Improvements constructed or acquired with the proceeds of the 2003 Bonds are not in any way pledged to pay the debt service on the 2003 Bonds. Any proceeds of condemnation or destruction of any facilities financed with the proceeds of the 2003 Bonds are not pledged to pay the debt service on the 2003 Bonds and are free and clear of any lien or obligation imposed under the Fiscal Agent Agreement. Special Taxes The Authority has covenanted in the Fiscal Agent Agreement to compl~y 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 Fiscal Agent Agreement provides that the Special Taxes are payable and will be collected in the same manner and at the same time and in the same installment as thegeneral taxes on real property, and will have the same priority, become delinquent at the same times andin the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the general taxes on real property; provided, the Authority may provide for direct collection of the Special Taxes In certain circumstances. Because the Special Tax levy is limited to the maximum Special Tax rates set forth in the Rate and Method, no assurance can be given that, in the event of Special Tax delinquencies, the receipts of Special Taxes will, in fact, be collected in sufficient amounts in any given year to pay debt service on the 2003 Bonds. Although the Special Tax, when levied, will constitute a lien on parcels subject to taxation within the District, it does not constitute a personal indebtedness of the owners of property within the District. There is no assurance that the owners of real property in the District will be financially able to pay the annual Special Tax or that they will pay such tax even if financially able to do so. See "BONDOWNERS' RISKS" herein. NEITHER THE FAITH AND CREDIT NOR THE TAXING POWER OF THE AUTHORITY, THE DISTRICT (EXCEPT TO THE LIMITED EXTENT DESCRIBED HEREIN) OR THE STATE OR ANY POLITICAL SUBDIVISION THEREOF IS PLEDGED TO THE PAYMENT OF THE 2003 BONDS. OTHER THAN THE SPECIAL TAXES OF THE DISTRICT, NO TAXES ARE PLEDGED TO THE PAYMENT OF THE 2003 BONDS. THE 2003 BONDS ARE NOT A GENERAL OBLIGATION OF THE AUTHORITY OR THE DISTRICT, BUT ARE LIMITED OBLIGATIONS OF THE DISTRICT PAYABLE SOLELY FROM SOURCES PROVIDED IN THE FISCAL AGENT AGREEMENT. 12 Rate and Method General. The Special Tax is levied and collected according to the Rate and Method set forth in APPENDIX B - "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Rate and Method of Apportionment of Special Tax." The qualified electors of the District approved the Rate and Method on March 25, 2003. Capitalized terms used in the following paragraphs but not defined herein have the meanings given them in the Rate and Method. The Rate and Method provides the means by which the Board of Directors of the Authority may annually levy the Special Taxes within the District up to the Maximum Special Tax. The Rate and Method provides that the Annual Special Tax may not be levied after Fiscal Year 2043-44. Special Tax Requirement. Annually, at the time of levying the Special Tax for the District, the Authority will determine the amount of money to be collected from Taxable Property in the District (the "Special Tax Requirement"), which will be the amount required in any Fiscal Year to pay the following: (i) the annual debt service on all outstanding Bonds due in the calendar year which commences in such Fiscal Year; (ii) periodic cost on the Bonds, including, but not limited to, credit enhancement and rebate payments on the Bonds; (iii) Administrative Expenses; (iv) an amount equal to any anticipated shortfall due to Special Tax delinquency in the prior Fiscal Year; and (v) any amount required to establish or replenish any reserve funds for the outstanding Bonds; less (vi) a credit for funds available to reduce the annual Special Tax levy as determined pursuant to the Fiscal Agent Agreement. Developed and Undeveloped Property; ExemptProper~y. The Rate and Method declares that for each Fiscal Year, all Parcels of Taxable Property within the District of each Zone shall be classified as either Developed Property, Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that is not Exempt Property and shall be subject to the levy of Special Taxes in accordance with the Rate and Method. (i) (ii) (iii) (iv) "Taxable Property" means all Parcels in the District which have not prepaid pursuant to the Rate and Method, or are not exempt from the Special Tax pursuant to law or the Rate and Method. "Develoned Provertv" means all Parcels of Taxable Property, not classified as Approved Property, Undeveloped Property, Public Property and/or Property Owner's Association Property that are not Exempt Property pursuant to the provisions of the Rate and Method, (i) that are included in a Final Map that was recorded prior to the January I st preceding the Fiscal Year in which the Special Tax is being levied and (ii) a building permit for new construction has been issued prior to April Ist preceding the Fiscal Year in which the Special Tax is being levied. "Approved Property" means for the any Fiscal Year, all Parcels of Taxable Property: (i) that are included in a Final Map that was recorded prior to the January I st preceding the Fiscal Year in which the Special Tax is being levied, and (ii) for which a building permit was not issued prior to the April Ist preceding the Fiscal Year in which the Spec]al Tax is being levied. "Public Property" means any property within the boundary of the District which, as of st -- January 1 of the preceding Fisca[Year for which the Special Tax is being levied is used for rights-of-way or any other purpose and is owned by, dedicated to, or irrevocably offered 13 (v) for dedication to the federal govemment, the State of California, the County, City or any other local jurisdiction, provided, however, that any property leased by apublic agency to a private entity and subject to taxation under Section 53340.1 of the Act shall be taxed and classified according to its use. "Undeveloved Property" means all Taxable Property not classified as Developed Property, Approved Property, Public Property and/or Property Owner Association Property that is not Exempt Property (as defined in the Rate and Method). (vi) "Zones" means Zone 1 or Zone 2 as geographically identified on the boundary map of the District attached to the Rate and Method. The Lennar Merchant Builders and PCC III properties are within Zone I and the KB Home Coastal properties are within Zone 2. (vii) "Exemptions" is defined to include the following: Zone 1. The Rate and Method provides that no Special Tax shall be levied on up to 93.41 acres of Public Property and/or Property Owner Association Property within Zone I of the District. The District Administrator will assign tax-exempt status in the chronological order in which property becomes Public Property and/or Property Owner's Association Property within Zone 1. [Once an Assessor's Parcel has been classified as Public Property, its tax-exempt status will be permanent, independent of its future uses.] Public Property includes property used for rights-of-way or any other purpose and owned by, dedicated to, or irrevocably offered for dedication to the federal government, the State, the County, the City or any other local jurisdiction. After the limit of 93.41 acres within Zone 1 of the District has been reached, the Maximum Special Tax obligation for any additional Public Property and/or Property Owner's Association Property shall be prepaid in full pursuant to the Rate and Method, prior to the transfer of dedication of such property. Until the Maximum Special Tax obligation is prepaid as provided in the preceding sentence, the Public Property and/or Property Owner's Association Property within the District shall be subject to the levy of the Special Tax as provided for in the Rate and Method. Zone 2. The Rate and Method provides that no Special Tax shall be levied on up to 30.43 acres of Public Property and/or Property Owner Association Property within Zone 2 of the District. The District Administrator will assign tax-exempt status in the chronological order in which property becomes Public Property and/or Property Owner's Association Property within Zone 2. [Once an Assessor's Parcel has been classified as Public Property, its tax-exempt status will be permanent, independent of its future uses.] After the limit of 30.43 acres within Zone 2 of the District has been reached, the Maximum Special Tax obligation for any additional Public Property and/or Property Owner's Association Property shall be prepaid in full pursuant to the Rate and Method, prior to the transfer of dedication of such property. Until the Maximum Special Tax obligat!on is prepaid as provided in the preceding sentence, the Public Property and/or Property Owner s Association Property within the District shall be subject to the levy of the Special Tax as provided for in the Rate and Method. Maximum Special Tax. The Maximum Special Tax is defined in the Rate and Method as follows: (i) Undeveloned Property and Approved Property: Zone 1. The Maximum Special Tax for each Parcel of Undeveloped Property and Approved Property within Zone 1 shall be $5,547 per acre. Zone 2. The Maximum Special Tax for each Parcel of Undeveloped Property and Approved Property within Zone 2 shall be $8,519 per acre. (ii) Developed Property: The Maximum Special Tax for each Parcel of Residential Property within ~ts applicable Zone that is classified as Developed Property shall be the greater of (i) the applicable Assigned Special Tax described in the Rate and Method, or (ii) the amount derived by apphcation of the Backup Special Tax. The Maximum Special Tax for each Parcel of Non-Residential Property shall be the Assigned Special Tax described in the Rate and Method. The Assigned Annual Special Tax for Developed Property ranges from $308 for a multifamily residential unit to $5,136 per residential unit in Zone I and from $473 for a multifamily residential unit to $1,927 per residential unit in Zone 2. See 14 APPENDIX B - "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Rate and Method of Apportionment of Special Tax - Table l" herein for a listing of the Assigned Annual Special Tax rates for various sizes of units in each Zone. Zone 1 Backup Special Tax. The Backup Special Tax shall be $5,547 per acre for Parcels of Residential Property that are included in a Final Map. Zone 2 Backup Special Tax. The Backup Special Tax shall be $8,519 per acre for Parcels of Residential Property that are included in a Final Map. Method of.,tpportionment. The Rate and Method provides that commencing Fiscal Year 2003- 04 and for each following Fiscal Year, the Authority shall levy the Special Tax on all Taxable Property until the amount of Special Taxes equals the Special Tax Requirement in accordance with the following steps: First: The Special Tax shall be levied Proportionately on each Parcel of Developed Property at up to 100% of the applicable Assigned SpecialTax rate in Tables 1 or 2 of the Rate and Method as needed to satisfy the Special Tax Requirement; Second: If additional moneys are needed to satisfy the Special Tax Requirement after the first step--~--'~en completed, the Special Tax shall be levied Proportionately on each Parcel of Approved Property at up to 100% of the Maximum Special Tax for ApprovedProperty; Third: If additional moneys are needed to satisfy the Special Tax Requirement after the first two steps-~'-~e been completed, the Special Tax shall be levied Proportionately on each Parcel of Undeveloped Property at up to 100% of the Maximum Special Tax for Undeveloped Property; Fourth: If additional moneys are needed to satisfy the Special Tax Requirement after the first three-'-~s have been completed, the Special Tax to be levied on each Parcel of Developed Property whose Maximum Special Tax is derived through the application of the Backup Special Tax shah be increased Proportionately from the Assigned Special Tax up to the Maximum Special Tax for each such Parcel; and Fil~h: If additional moneys are needed to satisfy the Special Tax Re~luirement after the first four steps~-~have been completed, then the Special Tax shall be levied Proportionately on each Parcel of Pubhc Property and/or Pro~0.arty Owner Association Property that is not Exempt Property at up to 100% pursuant to the provisions of the Maximum Special Tax. Notwithstandingthe above, under no circumstances will the Special Taxes levied against any Parcel of Residential Property be increased by more than ten percent (10%) per Fiscal Year as a consequence of delinquency or default by the owner of any other Parcel within the District. Prepayment of Maximum Special Taxes. The Maximum Special Tax obligation for a Parcel of Developed Property, Approved Property for which a building permit has been issued or Public Property and/or Property Owner's Association Property that is not Exempt Property may in certain circumstances be prepaid in whole or in part, provided that there are no delinquent Special Taxes, penal'~ies, or interest charges outstanding with respect to such Parcel at the time the Annual Special Tax obligation would be prepaid. The Prepayment Amount for an applicable Parcel after the issuance of 2003 Bonds is calculated based on Bond Redemption Amounts and other costs, all as specified in APPENDIX B - "Temecula Public Financing Aathor~ty Community F,a,,cilities District No. 03-1 (Crowne Hill) Rate and Method of Apportionment of Special Tax - Section H herein. Any suchprepayment will result in a redemption of Bonds prior to maturity. See "THE 2003 BONDS - Terms of Redemption." Special Taxes and the Teeter Plan The County has adopted a Teeter Plan as provided for in Section 4701 et seq. of the California Revenue and Taxation Code, under which a tax distribution procedure is implemented and secured roll taxes are distributed to taxing agencies within the County on the basis of the tax levy, rather than on the basis of actual tax collections. By policy, the County does not include assessments, reassessments and special taxes of the District in its Teeter program. 15 Proceeds of Foreclosure Sales Pursuant to Section 53356.1 of the Act, in the event of any delinquency in the payment of the Special Tax, the District may order the institution of a Superior Court action to foreclose the lien therefor within specified time limits. In such an action, the real property subject to the unpaid amount may be sold at judicial foreclosure sale. Such judicial foreclosure action ~s not mandatory. Under the Fiscal Agent Agreement, on or about February 15 and June 15 of each Fiscal Year, the Treasurer shall compare the amount of Special Taxes theretofore levied in the District to the amount of Special Tax Revenue theretofore received by the Authority, and: Individual Delinquencies. If the Treasurer determines that any single parcel subject to the Special Tax in the District is delinquent in thepayment of Special Taxes in the aggregate amount of $2,500 or more, then the Treasurer will sendor cause to be sent a notice of delinquency (and a demand for immediate payment thereof) to the property owner within 45 days of such determination, and (if the delinquency remains uncured) foreclosure proceedings will be commenced by the Authority within 90 days of such determination. Notwithstanding the foregoing, the Treasurer may defer such action if the amount in the Reserve Fund is at least equal to the Reserve Requirement. Aggregate Delinquencies. If the Treasurer determines that (i) the total amount of delinquent Special Tax for the prior Fiscal Year for the entire District (including total individual delinquencies described above) exceeds 5% of the total Special Tax due and payable for theprior Fiscal Year or (ii) there are ten (10) or fewer owners ofrealproperty in the District determinedby reference to the latest available secured property tax roll of the County, the Treasurer shall notify or cause to be notified property owners who are then delinquent in the payment of Special Taxes (and demand immediate payment of the delinquency) within 45 days of such determination and the Authority will commence foreclosure proceedings within 90 days of such determination against each parcel of land in the District with a Special Tax delinquency. It should be noted that any foreclosure proceedings commenced as described above could be stayed ,b,y the commencement of bankruptcy proceedings by or against the owner of the delinquent property. See BONDOWNERS' RISKS - Bankruptcy and Foreclosure Delay." No assurances can be given that a judicial foreclosure action, once commenced, will be completed or that it will be completed in a timely manner. See "BONDOWNERS' RISKS - Potential Delay and Limitations in Foreclosure Proceedings." If a judgment of foreclosure and order of sale is obtained, the judgment creditor (the District) must cause a Notice of Levy to be issued. Under current law, a judgment debtor (property owner) has 120 days from the date of service of the Notice of Levy and 20 days from the subsequent notme of sale in which to redeem the property to be sold. If a judgment debtor fails to so redeem and the property is sold, his only remedy is an action to set aside the sale, which must be brought within 90 days of the date of sale. If, as a result of such action, a foreclosure sale is set aside, the judgment is revived and the judgment creditor is entitled to interest on the revived judgment as if the sale hadnot been made. The constitutionality of the aforementioned legislation, which repeals the former one-year redemption period, has not been tested; and there can be no assurance that, if tested, such legislation will be upheld. Any parcel subject to foreclosure sale must be sold at the minimum bid price unless a lesser minimum bid price ~s authorized by the Owners of 75% of the principal amount of the Bonds Outstanding. No assurances can be given that the real property subject to sale or foreclosure will be sold or, if sold, that the proceeds of sale will be sufficient to pay any delinquent Special Tax installment. The Act does not require the Authority or the District to purchase or otherwise acquire any lot or parcel of property offered for sale or subject to foreclosure if there is no other purchaser at such sale. The Act does specify that thc Special Tax will have the same lien priority in the case of delinquency as for ad valorem property taxes. If delinquencies in the payment of Special Taxes exist, there could be a default or delay in payments to the Owners of the 2003 Bonds pending prosecution of foreclosure proceedings and receipt by the District of foreclosure sale proceeds, if any. However, within the limits of the Rate and Method of Apportionment and the Act, the D~strict may adjust the Special Taxes levied on all property within the District in future Fiscal Years to provide an amount, taking into account such delinquencies, required to pay debt service on the 2003 Bonds. There is, however, no assurance that the maximum Special Tax rates will be at all times sufficient to pay the amounts required to be paid on the 2003 Bonds and any Parity Bonds by the Fiscal Agent Agreement. 16 Special Tax Fund Pursuant to the Fiscal Agent Agreement, all Special Tax Revenues received by the District will be deposited in the Special Tax Fund, which will be held by the Fiscal Agent on behalf of the District. Moneys in the Special Tax Fund shall be held in trust by the Fiscal Agent for the benefit of the District and the Bondowners. Pendingdisbursement, moneys in the Special Tax Fund will be subject to a lien in favor of the Bondowners and the District established under the Fiscal Agent Agreement. Disbursements. Moneys in the Special Tax Fund will be disbursed as needed to pay the obligations of the District as provided in the Fiscal Agent Agreement. The Authority shall promptly remit any Special Tax Revenues received by it to the Fiscal Agent for deposit by the Fiscal Agent to the Special Tax Fund. Any Special Tax Revenues constituting payment of the portion of the Special Tax levy for Administrative Expenses shall be deposited by the Treasurer in the Administrative Expense Fund and any proceeds of Special Tax Prepayments shall be transferred by the Treasurer to the Fiscal Agent for deposit by the Fiscal Agent directly in the Special Tax Prepayments Account established in the Bond Fund. On each lnterest Payment Date, the Fiscal Agent shall withdraw from the Special Tax Fund and transfer the following amounts in the following order of priority (i) to the Bond Fund an amount, taking into account any amounts then on deposit in the Bond fund and any expected transfers from the General Account of the Improvement fund, the Reserve Fund, the Capitalized Interest Account and the Special Tax Prepayments Account to the Bond Fund, such that the amount in the Bond Fund equals the principal (including any sinking payment), premium, if any, and interest due on the Bonds on such lnterest Payment Date and (ii) to the Reserve Fund an amount, taking into account amounts then on deposit in the Reserve Fund, such that the amount in the Reserve Fund is equal to the Reserve Requirement. Investment. Moneys in the Annual Levy Account and the Prepa~.ment Account of the Special Tax Fund will be invested and deposited by the Authorized Officer as described in "Investment of Moneys in Funds" below. Interest earnings and profits resulting from such investment and deposit will be retained in the respective account from which the investment was made to be used for the purposes of such account. Bond Fund The Fiscal Agent will hold the Bond Fund in trust for the benefit of the Bondowners. There is created in the Bond Fund, as separate accounts to be held by the Fiscal Agent, the Bond Payment Account, the Capitalized Interest Account and the Special Tax Prepayments Redemption Account. Moneys in the Bond Fund and the accounts therein shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds and for the other purposes as provided below, and, pending such disbursement, shallbe subject to a lien in favor of the ownem of the Bonds. Special Tax Prepayments Account. Moneys in the Special Tax Prepayment Account shall be transferred by the Fiscal Agent to the Bond Fund on the next date for which not~ce of redemption of Bonds can timely be given under the Fiscal Agent Agreement and shall be used (together with any amounts transferred form the Reserve Fund) to redeem Bonds on the applicable redemption date. CapitalizedlnterestAccount. Moneys in the Capitalized Interest Account shall be transferred to the Bond Fund on the Business Day prior to each Interest Payment Date, in the amount equal to and to be used for the payment of interest on the Bonds due on the next succeeding Interest Payment Date provided that no such transfer shal exceed the amount then on deposit in the Capitalized Interest Account. BondFund. Moneys in the Bond Fund and the accounts therein shall be held in trust by the Fiscal Agent for the benefit of the Owners of the Bond, shall be disbursed for the payment of the principal of, and interest and any premium on, the Bonds as provided below, and, pending such disbursement, shall be subject to a lien in favor of the Owners of the Bonds. On each Interest Payment Date the Fiscal Agent shall withdraw from the Bond Fund and pay to the Owners of the Bonds the principal, and interest and any premium, then due and payable on the Bonds, including any amounts due on the Bonds by reason of the stoking payments or an optional redemption of the Bonds. In the event that amounts in the Bond Fund are insufficient for the purposes set forth in the preceding sentence, the Fiscal Agent shall withdraw from the Reserve Fund to the extent of any funds therein amounts to cover the amount of such Bond Fund insufficiency. If, after the foregoing transfem, there are insufficient funds in the Bond Fund to make the payments provided for above, the Fiscal Agent shall apply the available funds first to the payment of interest 17 on the Bonds, then to the payment of principal due on the Bonds other than by reason of sinking payments, and then to thepayment of principal due on the Bonds by reason of sinking payments. Any sinking payment not made as scheduled shall be added to the sinking payment to be made on the next sinking payment date. Investment. Moneys in the Bond Fund, the Capitalized Interest Account and the Special Tax Prepayments Account shall be invested and deposited in accordance with the provisions of the Fiscal Agent Agreement relating to Investment of Moneys. See APPEND1X E-"Summary of Certain Provisions of the Fiscal Agent Agreement." Administrative Expense Fund The Fiscal Agent will receive the transfer of Special Taxes from the District from the Special Tax Fund and deposit in the Administrative Expense Fund an amount to pay Administrative Expenses. Pursuant to the Fiscal Agent Agreement, moneys in the Administrative Expense Fund will not be eonstrned as a trust fund held for the benefit of the Bondowuers and will not be available for the payment of debt service ou the 2003 Bonds. Investment of Moneys in Funds Moneys in any fund or account created or established by the Fiscal Agent Agreement and held by the Fiscal Agent will be invested by the Fiscal Agent in Permitted Investments, as directed by an Authorized Officer, that mature prior to the date on which such moneys are required to be paid out under the Fiscal Agent Agreement. In the absence of any direction from an Authorized Officer, the Fiscal Agent will invest, to the extent reason, ably practicable, any such moneys in money market funds rated in the highest rating category by Moody s or S&P,[ (including those for which the Fiscal Agent or its affiliates or its subsidiaries provide investment, advisory or other services)]. See APPENDIX E -"Summary of Certain Provisions of the Fiscal Agent Agreement" for a definition of"Permitted Investments." Rebate Requirement The Authority is required to calculate excess investment earnings ("Excess Investment Earnings") in accordance with the requirements set forth in the Fiscal Agent Agreement. The Authority shall calculate Excess Investment Earnings and if necessary may use amounts in the Administrative Expense Fund and in the Reserve Fund, and any other funds available to the District (except amounts required to pay debt service on the 2003 Bonds), including amounts advanced by the Authority, m its sole discretion, to be repaid by the District as soon as practicable from amounts described in the preceding clause, to satisfy its obligations under Section 148(0 of the Code. Additional Bonds for Refunding Purposes Only Bonds issued on a parity with thc 2003 Bonds (each a Series of"Additional Bonds") may be issued for refunding purposes only. See APPENDIX E - "Summary of Certain Provisions of the Fiscal Agent grecment. The District may ~ssue bonds or other obhgat:ons payable from Special Taxes whlch are subordinate to thc 2003 Bonds. THE AUTHORITY The Temecula Public Financing Authority was established pursuant to a Joint Exercise of Powers Agreement, dated April 10, 2001 (the "Joint Powers Agreement"), by and between the City and the Redevelopment Agency of the City of Temecula. The Joint Powers Agreement was entered into pursuant to the provisions of Articles 1 through 4 (commencing with Section 6500) of Chapter 5, Division 7, Title I of the Government Code of the State of California. The Authority was formed for the primary purpose of assisting in the financing and refinancing of public capital improvements in the City. The Authority is administered by a five-member Board of Directors, which currently consists of the members of the City Council of the City. The Authority has no independent staff. The Executive Director of the Authority is the City Manager of the City, and the Treasurer of the Authority is the City's Finance 18 Director. The Executive Director administers the day-to-day affairs of the Authority, and the Treasurer has custody of all money of the Authority from whatever source. Authority for Issuance The 2003 Bonds are issued pursuant to the Act and the Fiscal Agent Agreement. In addition, as required by the Act, the Board of Directors of the Authority has taken the following actions with respect to establishing the District and authorizing issuance of the 2003 Bonds: Resolutions of Intention: On January 28, 2003, the Board of Directors of the Authority adopted Resolution No. TPFA 03-1 stating its intention to establish the District and to authorize the levy of a special tax therein, and on [the same day] the Authority adopted Resolution No. TPFA 03- 02 stating its intention to incur bonded indebtedness in an amount not to exceed $25,000,000 within the District for the purpose of financing the cost of certain public improvements (the "Facilities") and to eliminate an existing special assessment lien (the "Prior Lien"). See "PLAN OF FINANCE; IMPROVEMENTS TO BE FINANCED WITH PROCEEDS OF THE 2003 BONDS" herein. Resolution of Formation: Immediately following the conclusion of a noticed public hearing on March,,2,5, 2003, the Authority adopted Resolution No. TPFA - (the "Resolution of Formation ), which established the District and authorized the levy oD' ~pecial tax within the District. Resolution of Necessity: On March 25, 2003, the Authority adopted Resolution No. TPFA ..~-~ declaring the necessity to incur bonded indebtedness in an amount not to exceed $25,000,000 w~th~n the District and submitting that proposition to the qualified electors of the District. Resolution Calling Election: On March 25, 2003, the Authority adopted Resolution No. TPFA calling an election by the landowners for the same date on the issues of the levy of the Specia TI~-~, the incurring of bonded indebtedness and the establishment of an appropriations limit. Landowner Election and Declaration of Results: On March 25, 2003, an election was held within the District in which the landowners eligible to vote, being the qualified electors within the District, unanimously waived all time limits for holding the election and ballot arguments, and approved a ballot proposition authorizing the issuance of up to $25,000,000 in bonds to finance the costs of the Facilities and the costs of ehminating the Prior Lien, the levy of a special tax and the establishment of an appropriations limit for the District. On March 25, 2003, the Authority adopted Resolution No. TPFA - , pursuant to which the Authority approved the canvass of the votes and declared the District to~0e-~ully formed with the authority to I~vy the Special Taxes, to incur the bonded indebtedness and to have the established appropriations limit. The landowner election was ratified at proceedings conducted on May 13, 2003. Special Tax Lien andLevy: A Notice of Special Tax Lien was recorded in the real property records of Riverside County on April 4, 2003 as Document No. 2003-238653. An Amended Notice of Special Tax Lien was recorded in the real property records of Riverside County on May __, 2003 as Document No. 2003- Ordinance Levying Special Taxes: On April 8 2003, the Authority adopted an ordinance levy ng the Special Tax within the District. Resolution Authorizing Issuance of the 2003 Bonds: On May 13, 2003, the Authority adopted Resolution No. TPFA __-__ approving issuance of the 2003 Bonds. 19 THE COMMUNITY FACILITIES DISTRICT Location and Description of the District The District consists primarily of mass graded unimproved land located in the easterly portion of the Cily of Temecula, in the south-westerly portion of the County. The District is bounded generally on the 20 west by Butterfield Stage Road, on the north by Pauba Road and by Route 79 on the south. The property within the District is governed by the Butterfield Stage Ranch Specific Plan. The Lennar Entities currently own or have rights under contracts with LENOne and PCC 100 with respect to approximately 556 lots (approximately [115.53] net acres of property) in the District and are planning It for development with a mixture ofr~tial, parks, and open space uses. KB Home Coastal owns 212 s~ngle family detached lots (approximately 51.98 net acres). As of March 15, 2003, of the 212 units, 53 were complete ,o,.r under construction. PCC III owns 28 custom estate lots (approximately [104.55] net acres). See THE COMMUNITY FACILITIES DISTRICT - Property Ownership" herein. Utility services for parcels in the District will be provided by Southern California Edison (electricity), Southern California Gas Company (natural gas), CR&R Disposal (refuse collection), EMWD (sewage), Rancho California Water District (water), Riverside County Flood Control District (storm water), [AT&T and Broadband] (cable-Zone 1), Media One (cable-Zone 2) and Verizon (telephone). Schools are located in the Temecula Valley Unified School District. Specific Plan The Butterfield Stage Ranch Specific Plan was adopted in November 1987 by the County. The Butterfield Stage Ranch Specific Plan serves as a planning guide for development oftheproperty in the District. The Butterfield Stage Ranch Specific Plan development concept includes residential neighborhoods, landscape buffers, homeowners' association, private-owned park sites, open space and equestrian trails. Environmental Conditions Environmental Impact Report. In connection with the Butterfield Stage Ranch Specific Plan approval, the owner at that time was responsible for the application andprocessing of Environmental Impact eportNo. 230 (the EIR ) for the property encompassedby the Butterfield Stage Ranch Specffic Plan. The EIR was certified March 1988 (SCH NO. 87030927). A Phase 1 Environmental Site Assessment was approved in November 1997. The Phase I Environmental Site Assessment identified dumped material located throughout the property and a former above ground storage tank site and vault area in the eastern portion of the site, north of Lisa Road and Cee Cee Lane. The report concluded that the site had a low risk of contamination. The identified materials have been removed by a prior owner and Lennar Homes is not aware of any adverse conditions relating to the property. Endangered Species Act Permit. On July 23, 2002, Lennar Homes assumed PCC IlI's obligations under Endangered Species Act Permit TE03500-0. Lennar Homes is responsible for implementing remaining measures. The permit authorizes incidental take of certain federally threatened species, including coastal California gnatcatcher, endangered species including Quino checkersp, ot butterfly and Riverside fairy shrimp and certain listed sensitive species. Lennar Homes is subject to compliance with, and implementation of Assessment District No. 161 Multiple Species Subarea Habitat Conservation Plan and Implementation Agreement. The development is not within Assessment District No. 161, but is within the Subarea Habitat Conservation Plan area. Lennar Homes has completed grading of the property in compliance with the applicable requirements. Biological Resources. Based upon the biological studies performed for the site, the property within the District does not include significant onsite biological resources. The Butterfield Stage Ranch Specific Plan proposes two public park sites (3.5 acres and 5.1 acres) and five (5) private parks to be developed consistent with the mitigation requirement of the U.S. Army Corps of Engineers and State Department of Fish and Game. Mitigation Relating to Waters of the United States. The U.S. Army Corps of Engineers has jurisdiction over developments in or affecting the navigable waters of the United States pursuant to the Rivers and Harbors Act and the Clean Water Act. The development within the District is expected to impact approximately 0.7 acre of non-vegetated water of the U.S. In order to compensate for the proiect's impacts to water of the U.S., in August 2001, the prior owner and the U.S. Army Corps of Engin'eer-s enteredinto a mitigation agreement that the owner create or restore 2.38 acres of water of the U.S., including creation of six vegetated detention basins, and creation or restoration at four locations on-site as stated in the April 2003 Crowne Hill Mitigat on and Monitoring Plan, a condition of the U.S. Army Corps of Engineers, and 21 agreed to by such agency. These four mitigation areas will be maintained as open space in perpetuity. The period for completion of the work ends on July 9, 2004 but is subject to extension. The mitigation agreement was obtained by a prior owner of the property and Lennar Homes assumed the agreement on · iOn July 9, 2001, the U.S. Army Corps of Engineers determined that the activity complied with the t~n~-and conditions of the nationwide permit issued under Section 404 of the Clean Water Act, provided that the activity met the criteria in the permit terms and conditions· The Section 401 Water Quality Certification was agreed to by the California Regional Water Quality Control Board (San Diego Division) on January 15, 2002. StreambedAlteration Agreement. A predecessor owner to LENOne filed a request for a Section 1603 Streambed Alteration Agreement with the California Department offish and Game ("CDFG"). The CDFG and Lennar [Homes/Communities] (as successor to Crowne Meadows, L.P.) entered into an Agreement Regarding Proposed Stream or Lake Alteration on February 7, 2001 to fill 0.92 acres of"waters olthe State" and mitigate with three restored drainages and one wetland basin, totaling 2.38 acres. It was assumed that the Streambed Alteration Agreement #6-140-00 was agreed to because CDFG did not respond within the response period. National Pollution Discharge Elimination System Permit and Storm Water Pollution Prevention Plan. Pursuant to the Federal Clean Water Act (Section 402(g)) and State General Construction Activity Storm Water Permit, a National Pollution Discharge Elimination System (NPDES) permit and storm water pollution prevention plan was required from the California Regional Water Qualfty Control Board (San Diego Region) for grading and construction of areas greater than five acres· Lennar Communities had a revised Storm Water Pollution Prevention Plan prepared for the project in conformance with the California NPDES General Permit No. CAS 000002 for Storm Wmer Discharges Associated with Construction Activity (Construction Permit). The permit and storm water pollution prevention plan were approved by the California Regional Water Quality Control Board (San Diego Division) on February 1,2002by Order 99-08. The prior owner obtained a Section 401 Water Quality Certification for Discharge of dredged and/or fill materials in June 2001 and was granted an amendment in January 2002 to use vegetated water quality basins instead of [explain CDS] and fossil filters. The proposed discharge from the Crowne Hilt project will compi~i'~i-~he applicable provisions of the Clean Water Act. Toxic materials are not known to have been treated, stored disposed spilled or leaked in significant quantities onto the proj eot site and no contaminated soils were found on the site. Prior to rough grading the land was maintained as natural open space. The property was vacant for some time before being acquired by the current owners. No significant spills or disposals of gasoline or diesel fuel are known to have occurred. Other Matters Nearby Airports. The Billy Joe Airport (private small aircraft facility) is located approximately one half mile east of the District. The French Valley Airport is located approximately 4.4 miles southwest of the District. AdditionalApprovals. Additional discretion..ar~ approval is needed for development in the District as contemplated by the EIR that would require additional environmental review by the City under the California Environmental Quality Act and the Lennar Entities do not anticipate such discretionary approvals will materially adversely affect development of the property within the District. Covenants, Conditions and Restrictions. All of the parcels in the District are subject to recorded covenants, conditions and restrictions that provide for a levy of homeowners' association assessments, on a basis subordinate to the lien of the Special Taxes. Acquisition of Improvements Th,e, Authority and Lennar Homes have entered into an Acquisition Agreement (the "Acquisition Agreement ) dated as of March 1, 2003. Under the terms of the Acquisition Agreement, the Authority will acquire the Improvements from Lennar Homes upon completion of various discrete components of infrastructure and inspection thereof by the City. The Acquisition Agreement provides that the infrastructure will be acquired for an amount based upon the documented Actual Cost (as defined in the Acquisition Agreement) thereof or for such other amount as may be agreed upon by Lennar Homes and the Authority. 22 Property Ownership The information about Lennar Communities, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC llI and Pacific Century Homes contained in this Official Statement has been provided by representatives of Lennar Homes, KB Home Coastal, PCC 100, PCC III and Pacific Century Homes and has not been independently confirmed or verified by the Underwriter, the District or the Authority. Such information is included because it may be relevant to an informed evaluation of the security for the 2003 Bonds. However, because ownership of the property may change at any time, no assurance can be given that the planned development will occur at all, will occur in a timely manner or will occur as presently anticipated and described below or that Lennar Communities, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC III, or Pacific Century Homes will continue to own the property within the District at all. No representation is made herein as to the accuracy or adequacy of such information, as to the experience, abilities or financial resources of Lennar Communities, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC III or Pacific Century Homes or any other landowner, or as to the absence of material adverse changes in such information subsequent to the date hereof, or that the information given below or incorporated herein by reference is correct as of any time subsequent to its date. £ennar Communities, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC 111 and Pacific Century Homes are not personally liable for payment of the Special Taxes or the 2003 Bonds, and the following information should not be construed to suggest that the Special Taxes or the 2003 Bonds are personal obligations or indebtedness of Lennar Corporation, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC III or Pacific Century Homes or that Lennar Communities, Lennar Homes, Greystone Homes, US Home, LENOne, KB Home Coastal, PCC 100, PCC Ill or Pacific Century Homes will continue to own the Property. Description of Project. Of the approximately 272.06 net acres of land encompassing the District, US Home and Greystone Homes are developing approximately 95.8 net acres planned for development of approximately 456 single family detached units and Lennar Homes is developing approximately 19.73 net acres planned for development of 100 single family detached units. Approximately 51.98 net acres were acquired by KB Home Coastal for development of approximately 212 single family detached units. PCC III owns approximately 104.55 net acres proposed for development of 28 custom estate lots. Table I below sets forth intormation regarding the projects being developed in the District. 23 Name of Landowner/ Development Merchant Builder Name Table 1 Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Property Ownership and Development Status Units Completed Total or Under Number Construction Net Status of as of Taxahle of Units March 15, 2003 Acreage Maps Status of Development as of March 15, 2003 LENOne-US Home Stratford 114 0 22.01 Final map Rough graded; final map recorded 11/5/92. LENOne - Nottingham 119 0 28.1 Final map Rough graded; final map Greystone Homes recorded 12/31/01. LENOne - Astoria 111 0 19.5 Final map Rough graded.; final map Greystone Homes recorded 12/31/01. PCC 100- Lennar Carlyle 100 0 19.73 Final map Rough graded; final map Homes recorded 12/31/01. LENOne - Fairmont 112 0 26.19 Final map Rough graded; final map Greystone Homes recorded 12/31/01. KB Home Coastal - Knightsbridge 127 34 33.66 Final map Final map recorded KB Home Coastal 12/31/01. 3 models and 31 production units under construction. KB Home Coastal - Hampton 85 19 18.32 Final map Graded lots; final map KB Home Coastal recorded 1/31/01. 2 model units completed and 17 production units under construction. PCC III - Pacific Estate Lots 2~8 O 104.55 Tentative Rough graded; final map Century Homes map est. to record during June 2003. Total 796 53 272.06 Source: Development Plan from Lennar Communities. Lennar Corporation and its Subsidiaries Lennar Communities, Lennar Homes, Greystone Homes and US Home; LENOne Lennar Corporation and its Subsidiaries. Lennar Homes of California, Inc. ("Lennar Homes") is a California corporation based in Mission Viejo, California, that has been in the business of developing residential real estate communities in California since 1995. Lennar Homes is a subsidiary of Lennar Corporation, a Delaware corporation ("Lennar Corporation"), with headquarters in Miami, Florida. Lennar Corporation, founded in 1954 and publicly traded under the symbol "LEN" since 1971, is one of the nation's largest home builders, operating under a number of brand names, including Lennar Ho_m,.es, US Home and Greystone Homes in Southern California. At November 30, 2002 (Lennar Corporation s fiscal year-end), Lennar Corporation employed over 9,419 individuals, of whom approximately 6,053 were involved in homebuilding operations and 3,366 were involved in financial services operations, and owned approximately 70,000 homesites and had access to an additional 99,000 homesites through options or unconsolidated parmerships. Lennar Communities, US Home, Greystone Homes and Lennar Homes are subsidiaries of Lennar Corporation. LENOne is not an affiliate of any of the Lennar entities. A brief description of each is provided below. Lennar Communities is involved in the management and acquisition of residential real estate projects in Southern California. Lennar Communities is not a merchant builder of production homes. US Home is a merchant builder of ?roduction homes and has been involved in the acquisition and development of residential real estate projects in Southern California since 1995. US Home develops 24 residential communities both within the Lennar family of builders and through consolidated and unconsolidated partnerships in which US Home maintains an interest. In fiscal year 2002, US Home delivered homes to in excess of 866 families in Southern California. Recent projects under development by US Home in Southern California include the following: Proposed Site Name Location Units Base Prices Square Feet Bedrooms Status Provenance Corona 118 $339,990-$395,990 2,395 Entrada/Ventana East Highlands 330 $251,990-$332,990 1,760 Autumnwood Fontana 97 $268,990-$309,990 1,883 Remington Fontana 123 $323,990-$350,990 2,983 Camargo Murrieta 67 $285,990-$295,990 1,980 Canterbury Murrieta 107 $309,990-$355,990 2,617 Magnolia Murrieta 73 $350,990-$390,600 3,399 - Mariposa Murrieta 61 $297,000-$326,800 2,740 - Auburn Village Murrieta 82 $294,990-$311,990 2,973 - Rockhurst Rancho Cucamonga 113 $379,000-$434,000 2,811 - 5,123 3-6 Sold out 3,816 4-7 Active 2,921 3-4 Sold out 3,400 5 Active 2,484 2-3 Active 3,684 3-5 Sold out 3,800 4-6 Active 3,282 3-4 Active 3,399 4-5 Sold out 3,508 4-6 Active Greystone Homes is a merchant builder of production homes and has been involved in the acquisition and development of residential real estate projects in Southern California since . Greystone Homes develops residential communities both within the Lennar family of builders and throu~onso[idated and unconsolidated partnerships in which Greystone Homes maintains an interest. In fiscal year [2001-02], Greystone Homes delivered homes to in excess of families in Southern California. Recent projects under development by Greystone Homes in Southern--California include the following: Proposed Site Name Location Units Base Prices Square Feet Bedrooms Status Lennar Homes has been involved in the acquisition and development of residential real estate projects in Southern California since 1995. Lennar Homes develops residential communities both within the Lennar family of builders and through consolidated and unconsolidated partnerships in which Lennar Homes maintains an interest. Representative master planned communities ~nclude: (i) Coto de Caza, an approximately 2,000 home development in South Orange County acquired in March of 1996 and sut>stantially sold out, (ii) Stevenson Ranch, to consist of apt?roximately 5,700 homes at build out in Los Angeles County, California, (iii) Bressi Ranch an approximately 500 acre mixed use community in Carlsbad, California which recently commenced grading, (iv) Greer Ranch, an approximately 674 home gate-guarded community in Murrieta, Califomia, which has sold 149 homes since the September, 2002 grand opening, and (v) The Bridges at Rancho Santa Fe an exclusive, gated residential enclave located in San Diego, California, consisting of approximately 274 custom homemes and semi-custom homes in a private golf course setting. LENOne. LENOne is a Virginia co~oration that acquired property previously owned by PCC III in connection with atransaction in which Pactfic Century Homes sold to [Lennar Corporation] substantially all of the real estate homebuilding assets of Pacific Century Homes. LENOne has entered into three Option Agreements and three Construction Agreements described below. It has no present intention of developing the property itself other than through the Option Agreements and Construction Agreements described below. 25 Neither LENOne nor any entity with a direct or indirect ownership interest in it has any obligation of any kind whatsoever to advance any funds for the development of LENOne's property in the District or to pay the Special Tax applicable to such property. As of March 15, 2003, LENOne owned 439 lots within the District. Pursuant to the provisions of the Option Agreements described below, LENOne granted Lennar Homes and Greystone Homes, or their assignees, the right, but not the obligation, to purchase all of the original 456 lots subject to such Agreements. 114 of such lots are expected to be developed by US Home and 342 of such lots are expected tobe developed by Greystone Homes, including 17 of such lots which were transferred to Greystone Homes on December 20, 2002. OptionA~reements and Construction Agreements. On or about July 12, 2002[ August 30, 2002], LENOne entered into three separate sets of agreements with Lennar Homes, Greystone Homes, and Lennar Communities for parcels in the District owned by LENOne. The separate sets of agreements consisted of Option Agreements and Construction Agreements pertaining to lots in the Stratford, Nottingham, Astoria and Fairmont tracts. The agreements relate to 213, 131 and 112 parcels, respectively and are located throughout the development projects of the Lennar Entities describedbelow. The Option Agreements and the Construction Agreements do not apply to the 212 lots owned by KB Home Coastal, the 100 lots owned by PCC 100 or the 28 lots owned by PCC III. The agreements for each area are described below. The Option Agreements were ,e, ach amended on Oct,ober 9, 2002 by a First Amendment to Option Agreement. As used herein, the terms Option Agreements' and "Construction Agreements" refer to all of the Option Agreements and Construction Agreements for each of the three areas. US Home is not a party to the Option Agreements or the Construction Agreements. However, US Home is part of the Lennar Corporation family of merchant builders. US Home will develop the 114 lots known as the Stratford tract for LENOne, the owner of the 114 lots. US Home will take title to these lots once Lennar Homes and Greystone Homes exercise the option under the Option Agreement(s) pertaining to the 114 lots in the Stratford tract. Pursuant to the Option Agreements, in the event that Lennar Homes or Greystone Homes does not perform, LENOne has the right to accelerate the option and Lennar Homes or Greystone Homes has the right to purchase all, but not less than all, of the property owned by LENOne not later than the l0th business d'ay after the date of any notice sent by LENOne of LENOne's acceleration of the option. In the event that the optionees do not perform, the optionees are obligated to take all actions reasonably requested by LENOne to facilitate LENOne's continued development and sale of the remaining lots. Lennar Homes or Greystone Homes, as "Optionee," also has the right to designate a third party purchaser of lots and to require LENOne to transfer title to said lots directly to a third party purchaser. Under the terms of the Option Agreements, Lennar Homes and Gre~ystone Homes have the right but not the obligation to purchase all of LENOne's lots covered by each respecttve Option Agreement on a fixed schedule at prices ranging from $84,480 to $97,665 per lot depending on location, in consideration of(a) the posting of a lot option deposit and payment of a due diligence fee by Greystone Homes and Lennar Homes, (b) the continuing payment of lot option extension fees by Greystone Homes and Lennar Homes, and (c) the performance of the obligations of Lennar Homes and Greystone Homes under each respective Option Agreement and other project documents, including each respective Construction Agreement. 26 The scheduled takedown of LENOne's lots for eah area covered by the Option Agreements is set forth in the following table. Table 2 Takedown Schedule and Option Price Date of Scheduled Acquisition Crowne Hill 213 Area Crowne Hill 131 Area Crowne Hill 112 Area No. of Lots Option No. of Lots Option No. of Lots Option to be Acqd. Price to be Acqd. Price to be Acqd. Price March 2003 - - 18o) $1,520,640 May 2003 - - 18 1,520,640 June2003 18 $ 1,660,950 18 $ 1,757,970 - August 2003 - - 18 1,520,640 September 2003 18 1,660,950 18 1,757,970 - November 2003 18 1,660,950 - 18 1,520,640 December 2003 - 18 1,757,970 - January 2004 18 1,660,950 - - February 2004 - - 18 1,520,640 March 2004 18 1,660,950 18 1,757,970 - May 2004 18 1,660,950 - 17 1,436, t60 June 2004 - 18 1,757,970 - July 2004 18 1,660,950 - 5 422,400 September 2004 18 1,660,950 18 1,757,970 - November 2004 18 1,660,950 - - - December 2004 - 18 1,757,970 - Febmary 2005 18 1,660,950 - - - April 2005 18 1,660,950 5 488,325 - June 2005 1~5 1,384,125 - - Totals 213 $19,654,575 131 $12,794,115 112 $9,461,760 (i) 17 lots were acquired on December 23, 2002. [On March 2003.] ,2003, LENOne waived the requirement for the 18t~ lot to be acquired by Greystone Homes and Lennar Homes are obligated to pay to LENOne a monthly lot option extension fee which is based on the average daily "outstanding expenses" for a month times an average daily floating rate for the month times the number of days in the month. "Outstanding expenses" include the original purchase price LENOne paid plus all amounts LENOne pays, including construction progress payments under the terms of each respective Construction Agreement discussed below, less amounts received by LENOne in connection with the sale of the lots. Greystone Homes and Lennar Homes have >oOSted the lot option deposit and have paid the due diligence fee, are current in the payment of the monthly t option extension fees, and have performed or are performing their obligations as provided in the Option Agreements and other project documents. All of the 456 lots that LENOne acquired in the District were unfinished lots requiring additional improvements before the lots could be ready for development. Pursuant to each respective Construction Agreement, LENOne engaged Greystone Homes and Lennar Homes as LENOne's construction manager, 27 developer and general contractor to cause certain improvements to be constructed in order to improve the unfinished lots to partially finished lots. The description of those improvements to be constructed and the schedule for completing each improvement is summarized in the following table. Table 3 Construction Schedule to Improve Unfinished Lots Owned by LENOne Completion Date (Assumes Last Day of Month) Crowne Hill Description of Improvement 213 Area Crowne Hill Crowne Hill 131 Area 112 Area Status Rough Grading Underground Sewer Improvements December 2002 Underground Storm Drain January 2003 Improvements Underground Domestic Water February 2003 Improvements Street improvements July 2003 November 2002 November 2002 [Month] December 2002 September 2002 January 2003 October 2002 February 2003 November 2002 March 2003 December 2002 Underground Dry Utilities August 2003 July 2003 January2003 Sidewalk and Drive Approaches R & R - Bond Release Work Febmary2005 Febraary2005 May2004 June 2005 June 2005 July 2004 Complete Complete Complete Complete Complete for 13l and H2 Areas Complete for 112 Area Subject to the satisfaction of all conditions to reimbursement for the costs of constructing the improvements, LENOne is required to reimbume Lennar Homes or Greystone Homes, as applicable, for the cost of the components of work identified in the budget included in each Construction Agreement. If, following completion of any component of work, the actual cost of completion of such component exceeds the portion of the amount allocated to such component in the budget, Lennar Homes is solely responsible forpaying the amount of costs required to complete such component. The budget may, however, be modified with the approval of LENOne to increase the amount budgeted for a component of work if there are demonstrated savings in unperformed components of work so that the modified budget will not exceed the total amount of the original budget. The following table summarizes the budget included in each Construction Agreement to improve LENOne's unfinished lots to partially finished lots. As of March 15, 2003, approximately $11,800,000 of the estimated budget for the Crowne Hill 213 area has been expended, approximately $5,762,000 of the estimated budget for the Crowne Hill 131 area has been expended and .approximately $6,203,000 of the estimated budget for the Crowne Hill 112 area has been expended. The improvement costs are greater than the aggregate estimated costs. 28 Table 4 Budget for Construction to Improve Unfinished Lots Owned by LENOne Components of Work to be Performed Crowne Hill Crowne Hill 213 Area 131 Area Crowne Hill 112 Amount Amount Area Amount Consultants $854,763 $516,644 Bonds 123,380 77,882 $570,092 Fees and Permits 2,296,890 1,402,051 1,048,443 Grading 1,930,784 1,150,151 899,866 Pipeline 1,184,556 825,086 589,101 Public Utilities 676,249 393,776 315,536 Street Improvements 1,630,930 1,120,504 816,510 Walls and Landscaping 2,429,043 1,477,241 1,069,509 Variable Costs 184~787 113~725 89,734 Total $9,007,770 $5,731,170 $4,345,793 Description of Lennar Merchant Builder Projects. US Home is not a poxty to the Option Agreements or the Construction Ag.r. eements. However, US Home is part of the Lennar Corporation family of merchant builders. US Home will take title to the 114 lots (approximately 22.01 net acres) known as the Stratford tract once Lennox Homes and Greystone Homes exercise the options under the Option Agreements pertaining to the 114 lots in the Stratford tract. These are currently vacant lots which are in a partially finished condition. There are currently no models and no production units under construction. The model homes are estimated to range from 2,617 to 3,684 square feet and are estimated to be completed during the second quarter of 2003. The project is anticipated to open for sales by June 30, 2003, and opening sales prices are currently projected to range from $315,000 to $380,000. Greystone Homes is developing 342 lots in the District. The lots are being developed as Nottingham, Astoria and Fairmont. There are currently vacant lots which are in a partially finished condition. There are currently no models or production urn'ts under construction by Greystone Homes. Title to 17 lots was transferred by LENOne to Greystone Homes on December 20, 2002. The model homes are estimated to range from 2,283 to 3,962 square feet and are estimated to be completed during the second quarter of 2003. The projects are anticipated to open for sales in the third quarter of 2003 and opening sales prices are currently projected to range from $294,000 to $395,000. Lennox Homes is developin]g 100 lots in the District. The lots are being developed as Carlyle. There are currently vacant lots which are ~n a poxtially finished condition. There are currently no models and no production units under construction. The model homes are estimated to range from 2,200 to 2,740 square feet and are estimated to be completed during the second quarter of 2003. The project is anticipated to open for sales in the third quarter of 2003, and opening sales prices are currently projected to range from $290,000 to $310,000. 29 The development which constitutes the Lennar Merchant Builders' projects, together with the estimated lot sizes, unit sizes and base sales price ranges, are set forth below. Minimum Estimated Lot Size Unit Size Estimated Base Project Name (Square Feet) (Square Feet) Sales Price Range Total Units US Home Stratford 7, 144 2,617 - 3,684 $315,000 - $380,000 114 Greystone Homes Nottingham 7,000 2,621 - 3,322 $324,125 - $364,125 119 Astoria 7,157 2,891 - 3,962 $330,000 - $395,000 111 Fairmont 5,998 2,283 - 2,925 $294,200 - $314,200 112 342 Subtotal LENOne Lots 456 Lennar Homes Carlyle 5,001 2,200 - 2,740 $290,000 - $310,000 100 Total Lennar Merchant Builder Lots 556 Status of Permits and Approvals. A final map encompassing all but the 28 custom estate lots was recorded on December 31, 2001. Pursuant to internal arrangements among Lennar Communities and the Lennar Merchant Builders, Lermar Communities is obligated to deliver partially finished lots to Lennar Homes, Greystone Homes and US Home. Lennar Communities completed rough grading of the properly in January 2003. Backbone infrastructure improvements, includlng water, sewer, drainage, street improvements, paving and street lights are under construction in the District and relate to the properties subject to development by the Lennar Merchant Builders, KB Home Coastal and PCC II1. As of March 15, 2003, rough grading was complete, 99% of the sewer and water was installed, storm drains improvements were approximately 90% complete, street improvements were approximately 90% complete, dry utilities (gas and electric) had commenced and were approximately 30% complete. Perimeter walls on Crowne Hill Drive were under construction and are approximately 60% complete. An approximately 3.5 acre public park was substantially complete. A second 5.1 acrepark is estimated to be constructed in the 3rd quarter of 2003. All of such improvements are estimated to be completed by the end of the 4th quarter of 2003. In order to complete its development plan, the Lennar Merchant Builders must construct the production homes and each Lennar Merchant Builder must complete interior streets and utilities. As of March 15, 2003, Lennar Communities has estimated the costs to develop the 796 lots to the stage of partially finished lots ready to build homes with the foregoing backbone ~nfrastructure to be $47,500,000 including estimated facilities financed with proceeds of the 2003 Bonds. Pursuant to Lennar Communities agreements with KB Home Coastal and PCC II I, Lennar Communities is obligated to complete grading and streets and utilities constructed for portions of the project being developed by KB Home Coastal and PCC III. Each Lennar Merchant Builder, KB Home Coastal and PCC III is responsible for internal streets, sewer, water, storm drainage, sidewalks and landscape improvements for the detached single family housing lots being developed by such entity. As of March 15, 2003, Lennar Communities [and the Lennar Merchant Builders have expended in the aggregate approximately $44,982,000 in land acquisition, development, infrastructure and financing costs relating to development of the properly within the District. Lermar Communities estimates that total development and infrastructure costs, including in-tract improvements for the Lennar Merchant Builders will aggregate approximately $73,720,000. Due to pre-existing agreements the property within the District is not subject to the Transportation Uniform Mitigation Fee. Major infrastructure which remains to be constructed includes the following: Royal Crest Place from Butterfield Stage Road to Crowne Hill Drive. 30 Lennar Communities has entered into an agreement with the Rancho California Water District relating to the provision of water service by Rancho California Water District to the property within the District. Lennar Communities entered into an agreement for EMWD to provide wastewater services to the property within the District in Development Budget. It is currently estimated that as of March 15, 2003, Lennar Communities and the Lennar Merchant Builders had expended approximately $34,410,196 in improvement costs, exclusive of land value, debt service and general and administrative costs. The following table sets forth Lennar Communities' budget for the approximately $47 490,392 million of estimated costs for developing the residential property, as of March 15, 2003, (exclusive of land acquisition costs). Table 6 is a projectton only and no assurance can be given that these results will be achieved. Actual cash flow will depend on future events such as the rate of land sales and actual costs of infrastructure development. 31 Table 5 THE LENNAR MERCHANT BUILDERS PROJECTS STRATFORD, NOTTINGHAM, ASTORIA, FAIRMONT AND CARLYLE PRO FORMA RESIDENTIAL DEVELOPMENT COSTS°l (Estimated as of March 15, 2003) Master Total Tract In Tract In Tract In Tract In Tract In Tract In Tract Infrastructure 23143 23143-1 23143-6 23143-5 23143-10 23143-11 23143-F &In-Tract Planning Planning Printing/Delivery 27,860 6,075 8,400 7,500 5,325 7,200 7,200 69,660 Civil Engineering 909,700 102,465 166,320 137,600 89,815 121,440 105,600 1,632,840 Soils Engineering 434,300 29,800 39,100 35,500 26,800 34,300 34,300 634,100 Traffic Engineering 0 0 0 0 0 0 0 0 Utility Consultant 30,000 10,125 14,000 12,500 8,875 12,000 12,000 99,500 Landscape Architect 175,000 8,100 11,200 10,000 7,100 9,600 9,600 230,600 Special Consultants 68,500 2,500 3,500 3,500 3,500 3,500 3,500 88,600 Fees/Bonds/ 1,215,524 676,032 863,903 796,588 555,152 722,237 770,811 5,600,347 Permits Impact Fees 24,810 1.181.685 1,095,694 1,145,991 1~03C020 1,400,515 1,401,124 7,385,639 Total Planning 2,985,694 2,016,782 2,202,117 2,149,179 1,732,587 2,310,792 2,344,135 $15,741,286 Direct Development Grading 6,980,003 48,600 78,320 50,000 42,600 57,600 33,600 7,290,723 Maint Special 0 0 0 0 0 0 0 0 Construction Temporary Erosion 485,940 5,000 5,000 5,000 5,000 5,000 5,000 515,940 Control Sewer System 155,450 137,262 180,050 149,236 121,535 154,785 207,005 1,105,303 Water System 385,050 179,379 219,665 191,815 147,970 149,585 225,445 1,498,909 Storm Drain System 683,095 63,710 78,520 158,135 16,900 7,500 31,570 1,018,430 Street 2,179,232 460,151 541,108 410,800 412,225 351,853 558,671 4,914,040 Improvements Dry Utilities 832,330 405,613 487,450 384,881 285,865 412,247 462,129 3,291,515 Perimeter/Ret. 763,460 137,635 173,980 143,600 116,360 65,940 200,860 1,621,835 Walls Special Amenities 0 0 0 0 0 0 0 0 Enny Features 0 0 0 0 0 0 0 0 Landscaping 3,958,594 297,465 126,210 290,400 42,070 90,995 219,835 5,025,569 Parks 2,223,740 0 0 0 0 0 0 2,223,740 Reimbursables 0 -241,311 -287,264 -234,818 -164,643 -247,984 -269,617 -1,465,617 Contingency 2~236,265 112~116 691~424 581~773 331,204 264,977 490,960 4~708~719 Subtotal 20,883,159 1,605,620 2,294,463 2,130,822 1,357,086 1,312,498 2,165,458 31.749,106 Total 23,868~853 3~622~402 4~496~580 4,280~001 3~089~673 3~623~290 4~509,593 $47.490.392 01 [Pro forma residential development costs only. Does not include la.nd acquisition costs.] Source: Lennar Communities. The discussion and budgets set forth above merely reflect Lennar Communities' present plan for the development of the property (and include certain costs relating to the property pursuant to the Option Agreements and Construction Agreements). There can be no assurance that Lennar Communities and the Lennar Merchant Builders will have the resources, willingness or ability to successfully implement the development plan as described above. Environmental Review. Most required development approvals were obtained over the last several years. See"THE COMMUNITY FACILITIES DISTRICT - Environmental Conditions" above. The project has satisfied reviews relating to sensitive plant or animal species on the property (among other matters). An archaeologist was on site during grading and no artifacts were encountered. Lennar Communities is not 32 aware of any additional permits required to proceed with development of the property other than the final map for the 28 custom estate lots and the usual permits required from the City and applicable local agencies. No lots are in the 100 year flood plain. Plan of Finance. Lennar Communities and the Lennar Merchant Builders are financing development of the property from internal sources (including cash and a revolving line of credit) and profits from sales of land to homeowners. As of March 15, 2003, approximately $44,982,000 had been expended in connection with acquisition and development of the project. The foregoing plans and Lennar Communities' projections are subject to change. There can be no assurance that Lennar Communities or Lennar Merchant Builders have the willingness or ability to successfully implement the development plans described above. In the event that cost overruns occur which exceed the funds described in the section captioned "Plan of Finance" above, Lennar Communities and the Lennar Merchant Builders will need to raise additional funds. No assurance can be given that such funds could be raised or would be raised on a timely basis. Continued development in the District may also be adversely affected by changes in general economic conditions, fluctuations in the real estate market and other similar factors. See "BONDOWNERS' RISKS" herein for a discussion of risk factors. If and to the extent that internal financing and land sales revenues are inadequate to pay the costs to complete the planned development of the lots within the District, portions of the project may not be developable. While Lennar Corporation has made such internal financing available in the past, there can be no assurance whatsoever of its willingness or ability to do so in the future; and it has no legal obligation of any kind to Bondowners to make any such contributions or to obtain loans. Other than pointing out the willingness of Lennar Corporation to provide internal financing in the past, Lennar Communities has not represented in any way that Lennar Corporation will do so in the future. Absorption. US Home has a projected absorption rate of approximately 15 units per quarter, commencing the fourth quarter of 2003 and concluding the second quarter of 2005. Greystone Homes has a projected absorption rate of approximately 18 units per quarter, commencing the second quarter of 2003 and concluding thefirst quarter of 2005 for the Nottingham project, 22 units per quarter commencing the fourth quarter of 2003 and concluding the first quarter of 2005 for the Astoria project and 16 units per quarter commencing the second quarter of 2003 concluding the first quarter of 2005 for the Fairmont project. Lennar Homes has aprojected absorption rate of approximately 18 units per quarter, commencing the fourth quarter of 2003 andconcluding the first quarter of 2005 for the Carlyle project. The foregoing absorption estimates were provided by the Lennar Merchant Builders. The Market Absorption Study contains projected absorption at build out of production homes which varies from the absorption estimated by th,e, Lennar Merchant Builders. See THE COMMUNITY FACILITIES DISTRICT - Market Absorption Study' and APPENDIX D - "Summary Market Absorption Study." History of Property Tax Payment; Loan Defaults; Bankruptcy. Lennar Communities has made the following representations on behalf of itself, Lennar Homes, US Home and Greystone Homes: · neither Lennar Communities, Lennar Homes, US Home, Greystone Homes nor to Lennar Communities' actual knowledge of any of its other current Affiliates (as defined in the Developer Continuing Disclosure Agreement attached hereto as Appendix G), has ever been delinquent in the payment of any ad valorem property taxes, special assessments or special taxes in any material amount, · neither Lennar Communities, Lennar Homes, US Home, Greystone Homes nor any of its other Affiliates is currently in material default on any loans, lines of credit or other obligation related to its development in the District or any of its other projects which default would in any way materially and adversely affect its ability to develop its property in the District as described in the Official Statement or to pay the Special Taxes for which it is responsible, 33 Lennar Communities, Lennar Homes, US Home, Greystone Homes and its Affiliates are solvent and neither Lennar Communities, Lennar Homes, US Home, Greystone Homes nor any of its other current Affiliates has filed bankruptcy or been declared bankrupt in the last five years, or has any proceeding ~ending or to their actual knowledge threatened in which Lennar Communities, Lennar Homes, US Home, reystone Homes or its Affiliates may be adjudicated as bankrupt, or discharged from any or all of its debts or obligations, and · no action, suit, proceedings, inquiry or investigations at law or in equity, before or by any court, regulatory agency, public board or body, is pending (with service of process to Lennar Communities, Lennar Homes, US Home, Greystone Homes or an Affiliate having been accomplished) against Lennar Communities, Lennar Homes, US Home, Greystone Homes or any Affiliate or, to the actual knowledge of the officer signing on behalf of Lennar Communities' after due ~nquiry, threatened, which if successful, would materially adversely affect the ability of Lennar Communities, Lennar Homes, US Home or Greystone Homes to complete the development and sale of the property proposed for development by such entities within the District or to pay special taxes or ad valorem tax obligations when due on such property within the District. Riverside County records indicate that taxes due in connection with certain parcels in the name of Greystone Communities are delinquent. The taxes relate to homes sold prior to November 2002 to homeowners in a community facilities district formed by the Murrieta Valley Unified School District. Greystone Homes had expected the taxes to be paid through the escrows relating to the sold homes and the homeowners were liable for payment of applicable amounts. The amounts involved are not material. KB Home Coastal KB Home Coastal Inc. ("KB Home Coastal"), a California corporation has acquired a total of 212 lots (aggregating approximately [51.98] net acres) within the District. KB Home Coastal is a wholly-owned subsidiary of KB Home, a Delaware Corporation ("KBH"). KBH has domestic operations divisions in California, Arizona, Nevada, New Mexico, Florida, Colorado and Texas. It also operates a full-service mortgage company for the convenience of its buyers. Founded in 1957, KBH is a Fortune 500 company listed on the NYSE under the ticker symbol "KBH.' Financial information about KBH is included in documents filed with the SEC, particularly in its Annual Report on Form 10-K and its most recent quarterly Report on Form 10-Q. KBH's lnternet home page is located at www.kbhomes.com. This lnternet address is included for reference only and the information on the lnternet site is not a part of this Official Statement or incorporated by reference into this Official Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on the Internet site. 34 Development Experience. In fiscalyear 2002, KBH delivered homes to approximately 25,000 families in the United States and France andapproximately 5,344 homes in California. The San Diego division of KB Home Coastal closed approximately 12,000 home sales in fiscal year 2002, and anticipates that it will close approximately 1,200 home sales in fiscal year 2003. Recent projects under development by KB Home Coastal in southern California include the following: Development Location Number of Homes Cardona Oceanside 156 Valente Oceanside 143 Emerald ridge Fallbrook 44 Sycamore Trails at Canyon Hills Lake Elsinore 128 Camden Menifee 193 Berksire Menifee 213 May Farms Perris 82 Presidio Scripps Ranch 39 Hunter Point Murietta 121 Wanis Oceanside 299 Borden Road San Marcos 82 River Ranch Oceanside 300 Description of KB Home Coastal Project. KB Home Coastal acquired 212 lots (approximately [51.98] net acres) in the District on April 11,2002 from PCC Ill. 127 lots are being developed as Knightsbndge and 85 lots are being developed as Hampton. There are currently 3 models and 31 production units under construction in Knightsbridge and 2 models completed and 17 production units under construction in Hampton. The model homes range from to square feet and were completed during April 2003. Opening sales prices are currently projected to'~-d~e from $259,900 to $306,990 in Knightsbridge and $292,990 to 360,990 in Hampton. The development which constitutes KB Home Coastal project, together with the estimated lot sizes unit sizes and base sales pr ce range, is set forth below. Minimum Estimated Lot Size Unit Size Estimated Base Project Name (Square Feet) (Square Feet) Sales Price Range Total Units Knightsbridge 5,000 1,597 - 2,492 Hampton 7,200 2,268 - 3,470 $259,990- $306,990 t27 $292,990- $360,990 85 Status of Permits and Approvals. A final map encompassing the 212 lots was recorded on December 31,2001. Lennar Communities is obligated to deliver partially finished lots to KB Home Coastal. As described above, under" - Lennar Corporation and its Subsidiaries Lennar Communities, Lennar Homes, Greystone Homes and US Home; LENOne- Status of Permits and Approvals," Lennar Communities has completed grading and is currently completing construction of all backbonepublic improvements, partially finished lots and ~n-tract street, sewer, water and dry utility improvements for the detached single housing lots within the District, including the 212 lots owned by KB Home Coastal. 35 Models were completed during April 2003 and homes sales commenced in April 2003. Environmental Review. Most required development approvals were obtained over the last several years. See "THE COMMUNITY FACILITIES DISTRICT- Environmental Conditions" above. The project has satisfied reviews relating to sensitive plant or animal species on the property (among other matters). An archaeologist was on site during grading and no artifacts were encountered. KB Home Coastal is not aware of any additional permits required to proceed with development of the property other than the usual permits required from the County and applicable local agencies. No lots are in the 100 year flood plain. Plan of Finance. KB Home Coastal financed the acquisition of its lots through its internal resources and expects to finance construction of in-tract improvements and housing units through internal resources and home sales. The completion of the in-tract subdivision improvements for landscaping, irrigation, final street lift, sidewalks and perimeter walls, and school fees are anticipated to cost approximately $1,750,000. Such improvements and school fees, the cost of building permits and the costs of home construction (including funds needed to pay the Special Taxes when due) have been and are expected to continue to be carried out by internal resources and home sales. Due to pre-existing agreements, the property within the District is not subject to the Transportation Uniform Mitigation Fee. KBH is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the SEC. Such reports, proxy statements and other information may be inspected and copied at the public reference facilities maintained by the SEC at prescribed rates at 450 Fifth Street, N.W., Washington, D.C. 20549 and at the SEC's regional offices at Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, lllinois 60661. In addition, the aforementioned material may also be inspected at the offices of the NYSE at 20 Broad Street, New York, New York 10005. KBH is listed on the NYSE under the ticker symbol "KBH." Copies of KBH's Annual Report and related financial statements prepared in accordance with generally accepted accounting standards, are available from KBH's website at kbhomes.com. This Internet address is included for reference only and the information on the Internet site is not a part of this Official Statement or incorporated by reference into this Offcial Statement. No representation is made in this Official Statement as to the accuracy or adequacy of the information contained on the Internet site. Financial information about KBH is included in documents filed with the SEC, particularly in its Annual Report on Form 10-K and its most recent Quarterly Report on Form 10-Q. All documents subsequently filed by KBH pursuant to the requirements of the Exchange Act after the date of this Official Statement wilt be available for inspection in the same manner as described above. Absorption. KB Home Coastal has a projected absorption rate of approximately ..~_ units jper quarter commencing the second quarter of 2003 and concluding the quarter of 2004 for the Kmghtsbndge project and__ units per quarter, commencing the second quarter o2~3 and concluding the quarter oi~2004 for the Hampton project. The foregoing absorption estimates were provided by the KB Home Coastal. The Market Absorption Study contains projected absorption at build out of production homes which varies from the absorption estim.a,!ed by the KB Home Coastal. See THE COMMUNITY FACILITIES DISTRICT - Market Absorption Study and APPENDIX D - "Summary Market Absorption Study." History of Property Tax Payment; Loan Defaults; Bankruptcy. KB Home Coastal has made the following representations: neither KB Home Coastal nor, to KB Home Coastal's actual knowledge, any of its current Affiliates (as defined in the Developer Continuing Disclosure Agreement attached hereto as Appendix G) has ever been delinquent in the payment of any ad valorem property taxes, special assessments or special taxes in any material amount, · neither KB Home Coastal nor any of its Affiliates is currently in material default on any loans, lines of credit or other obligation related to ~ts development in the District or any of its other projects which default would in any way materially and adversely affect its ability to develop its property in the District as described in the Official Statement or to pay the Special Taxes for which it is responsible, 36 · KB Home Coastal and its Affiliates are solvent and neither KB Home Coastal nor any of its current Affiliates has ever filed bankruptcy or been declared bankrupt, or has any proceeding pending or to KB Home Coastal's actual knowledge threatened in which KB Home Coastal or its Affiliates may be adjudicated as bankrupt, or discharged from any or all of its debts or obligations, and · no action, suit, proceedings, inquiry or investigations at law or in equity before or by any court, regulatory agency, public board or body, is pending (with service of process to KB Home Coastal or an Affiliate having been accomplished) against KB Home Coastal or any Affiliate or, to KB Home Coastal's actual knowledge, threatened, which if successful, would materially adversely affect the ability of KB Home Coastal to complete the development and sale of the property currently owned within the District or to pay special taxes or ad valorem tax obligations when due on its property within the District. PCC III and PCC 100. PCC II1 is a Delaware limited liability company based in Temecula, California. Pacific Century Homes is the managing member of PCC II1. PCC III originally acquired all of the property in the District on January 18, 2002, from Crowne Meadow, L.P., a Washington limited partnership. Due to financial arrangements relating to the 100 lots comprising the Carlyle project, such lots were acquired and title taken in the name of PCC III - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100"). Due to financial arrangements relating to 1 t 2 lots comprising the [Fairmont] pr.oj ect, such lsts were acqui~:~,d, and title taken in the name of PCC Ill - Crowne Hill112, LLC, a Delaware limited liability company ( PCC 112"). On April 11, 2002, PCC Ill sold 212 lots to KB Home Coastal. On July 12, 2002, Pacific Century Homes sold to Lennar Corporation substantially all of its real estate homebuilding assets, including 344 lots encompassed by the District and owned by PCC III and 112 lots encompassed by the District and owned by PCC 112, but excluding the 100 lots owned in the name of PCC III. Due to the financial arrangements relating to the 100 lots comprising the Carlyle project, such lots remained under the ownership of PCC 100, but the membership of PCC 100 was changed to reflect a 50% interest by Greystone Homes and a 50% interest by Double L Holdings, LLC, a Delaware limited liability company which is an affiliate of Mr. W 11 am Lo, one of the principals of Pacific Century Homes. As described above, under the agreement relating to the Carlyle project, Lennar Homes is expected to be the merchant builder with respect to the Carlyle project. In connection with the transaction between Pacific Century Homes and Lennar Corporation, PCC III retained the 28 custom estate lots. The managing member of PCC I11 is Pacific Century Homes. A member of PCC III is Pacific Century Communities Ill, LLC, a Delaware limited liability company. Pacific Century Homes is the manager of Pacific Century Communities III, LLC. Prior to sale of substantially all of its real estate homebuildlng assets to Lennar Corporation, the principals of Pacific Century Homes, were involved in the projects described in "Development Experience" below. Pacific Century Homes continues to be active in Temecula, California with respect to Pacific Century Homes was formed in December 1994 by Nell D. Gascon and William W. Lo to enter into the medium priced home building marketplace in Southern California. ,P_acific Century's offices are located in Temecula, California. Mr. Gascon and Mr. Lo are Pacific Century s sole shareholders. Further information on Mr. Gascon and Mr. Lo is set forth below. Pacific Century Homes sold substantially all of its real estate homebuilding assets Lennar Corporation on July 12, 2002 and remains active with Nell D. Gascon, President, who founded Pacific Century with William W. Lo, is responsible for directing corporate strategy and forward planning, as well as overseeing production design, governmental relations, entltlementprocessing purchasing construction, accounting and customer service. Nell Gascon is also a principal of Gascon Mar Ltd., a development concern responsible for over $345 000,000 in residential, commercia, retail and industrial developments, and previously served as president of Penasuitos Properties, the U.S. development subsidiary of Genstar corporation. Mr. Gascon is a graduate of San Diego State University with a B.S. degree in accounting. William W. Lo, Chairman and Chief Executive Officer who founded Pacific Century with Neil D. Gascon, is responsible for managing and overseeing land acquisition, product conceptualization, pricing, financing, bud[ge, ting, marketing, sales, and public relations. Previously, Mr. Lo served as executive vice president and cnief financial officer of Woodhaven Developers, Inc., a privately held real estate investment 37 and development company. Mr. Lo has a B.S. degree from Woodberry University and an M.B.A. degree from the University of Southern Califomia. Development Experience. Recent projects under development by Pacific Century Homes and its affiliates in Southern California prior to the sale of the homebuilding assets to Lennar [Corporation] are listed below. Projects remaining to be completed are now under development by . Number Average Average Completion Project Location of Units Square Feet Prices Date RiverWalk Hemet 75 1,850 $119,335 1996 BridleWalk Hemet 75 1,833 128,155 1996 ArborWalk Murrieta 314 2,100 139,000 1997 Mayberry Hemet 222 2,265 134,054 1998 Stonehurst Wildomar 59 2,096 156,937 1998 Windsong Wildomar 62 2,018 152,248 1998 Shenandoah Corona 89 2,786 262,225 1998 Promenade Temecula 68 3,187 247,696 1999 Parkhill Village San Jacinto 58 1,401 112,051 1999 Veranda Murrieta 183 3,118 22 t,l 81 1999 Melrose Moreno Valley 106 3,032 176,406 1999 Via del Lago Moreno Valley 166 3,015 195,245 1999 Summerhill Lake EIsinore 149 2,259 177,000 2001 Springfield Hemet 176 2,228 162,500 2001 ArborGlen near Marrieta 178 2,310 224,600 2002 Auberry Place Temecula 180 1,532 174,276 2003 (est.) Chelsea Estates Temecula 137 3,413 301,990 2003 (est.) Springfield II Hemet 158 2,123 172,780 2003 (est.) Via Verde Moreno Valley 133 1,977 167,212 2003 (est.) Via del Rey Moreno Valley t 46 2,123 169,990 2004 (est.) Entrada Highlands 137 3,052 279,990 2003 (est.) Ventana Highlands 188 2,855 235,990 2003 (est.) GH: Homestead Beaumont 72 2,123 159,990 2003 (est.) GH: Reserve Beaumont 66 1,780 151,990 2003 (est.) GH: Farm Beaumont 64 1,977 167,990 2003 (est.) Pepper Avenue Colton 111 t,780 172,990 2003 (est.) The Groves Loma Linda 38 3,081 293,990 2002 Picket Fences Adelanto 148 1,362 99,990 2003 (est.) Maybeny Victorville 163 2,124 142,990 2002 Description of PCC III Project. In connection with the acquisition of the Crowne Hill development in 2002 by Pacific Century Homes, PCC III acquired ownership of the 28 custom estate lots. These are currently vacant lots and are in a partially finished condition. PCC 111 is evaluating its alternatives for sale of these lots to a custom home builder or the sale of individual lots for construction of custom homes. Sales prices are currently projected to range from $750,000 to $925,000. The development which constitutes PCC llI's project, together with the estimated lot sizes, unit sizes and base sales price range, is set forth below. 38 Minimum Estimated Lot Size Unit Size Estimated Base Project Name (Square Feet) (Square Feet) Sales Price Range Total Units Custom Lots 2.16 acres 4,300 - 6,500 $750,000- $925,000 28 Status of Permits and Approvals. A final map encompassing the 28 lots is expected to be recorded during June 2003. Pursuant to the agreement between Pacific Century Homes and Lennar Corporation, Lennar Corporation, through Lennar Communities (as successor-in-interest to Pacific Century Homes) is obligated to construct backbone infrastructure. As described above, under" - Lennar Corporation and its Subsidiaries Lennar Communities, Lennar Homes, Greystone Homes and US Home; LENOne - Status of Permits and Approvals," Lennar Communities has completed grading and is currently completing construction of all backbone public improvements. PCC Ill or a custom home merchant builder which acquires the property will be responsible for in-tract street, sewer, water and dry utility improvements for the detached single housing lots. Because PCC Ill retained the 28 custom estate lots subject to the Development .Agreement, PCC Ill's remaining costs relate primarily to custom home construction costs and in-tract improvement costs. Due to pre-existing agreements the property within the District is not subject to the Transportation Uniform Mitigation Fee. Development Budget. It is currently estimated that as of March 15, 2003, PCC II1 had expended approximately $642,222 in improvement costs, exclusive of land value, debt service and general and administrative costs. The following table sets forth PCC lll's budget as of March 15, 2003 for the approximately $3,219,287 of estimated total costs for developing the property to a finished condition (exclusive of land acquisition costs). Table 6 is a projection only and no assurance can be given that these results will be achieved. Actual cash flow will depend on future events such as the rate of land sales and actual costs of infrastructure development. 39 Table 6 PCC III COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) PRO FORMA RESIDENTIAL DEVELOPMENT COSTS~/ (Estimated as of March 15, 2003) TOTAL~-TRACT1MPROVEMENTS DESCRIPTION CUSTOM LOTS Planning Planning Printing/Delivery 2,100 Civil Engineering 49,280 Soils Engineering 16,250 Traffic Engineering 0 Utility Consultant 5,600 Landscape Architect 10,000 Special Consultants 3,500 Fees / Bonds / Permits 236,524 Impact Fees 385,224 Total Planning $708,478 Direct Development Grading 21,000 Maint Special Construction 0 Temporary Erosion Control 15,000 Sewer System 210,000 Water System 175,950 Storm Drain System 282,845 Street Improvements 530,279 Dry Utilities 209,174 Perimeter / Ret. Walls 214,000 Special Amenities 0 Entry Features 0 Landscaping 419,500 Parks 0 Reimbursables 0 Contingency 433,061 Subtotal $2,510~809 Total $3,219,287 °~Pro forma residential development costs only. Does not include land acquisition costs. Source: PCC IlL 40 The discussion and budgets set forth above merely reflect PCC lll's present plan for the development of the residential portion of the property. There can be no assurance that PCC III will have the resoumes, willingness or ability to successfully implement the development plan as described above. Environmental Review. Most required development approvals were obtained over the last several lears. See "THE COMMUNITY FACILITIES DISTRICT- Environmental Conditions" above. The project as satisfied reviews relating to sensitive plant or animal species on the property (among other matters). An archaeologist was on site during grading and no artifacts were encountered. PCC III is not aware of any additional permits required to proceed with development of the property other than the final map for the 28 custom estate lots being processed by [Lennar Communities/Homes] and the usual permits required from the County and applicable local agencies. No lots are in the 100 year flood plain. Plan of Finance. PCC Ill has obtained financing from Scripps Investments in the amount of $2,200,000 all of which was outstanding on March 1, 2003. PCC III also has obtained a $776,640 loan from RFC of which $90,000 was outstanding on March 1,2003. The property also serves as security to Greystone Home for performance work relating to the property. PCC 1II esttmates that as of March 15, 2003, the remaining in-tract costs and fees to get to finishedlots, including school fees but excluding building permits fees was $1,803,307, of which approximately $413,448 of costs will be financed with proceeds of the Bonds. PCC III is negotiating the acquisition of construction financing with PFF Bank, Cucamonga, California. PCC III anticipates that this financing will also finance all carrying costs for the property (including the payment of the Special Tax once it is levied). PCC I11 anticipates repaying its loans from sale proceeds. The foregoing plans and PCC llI's projections are subject to change. There can be no assurance that PCC III has the willingness or ability to successfully implement the development plans described above. In the event that cost overruns occur which exceed the funds described above, PCC III will need to raise additional funds. No assurance can be given that such funds could be raised or would be raised on a timely basis. Continued development in the portion of the District owned by PCC I11 may also be adversely affected by changes in general economic conditions, fluctuations in the real estate market and other similar factors. See "BONDOWNERS' RISKS" herein for a discussion of risk factors. the bsorption. PCC III has a projected absorption rate of approximately 3 units per quarter commencing quarter of 2003 and concluding the quarter of 2005 for the custom estate lots. The foregoing absorption estimates were provided by the PCC III. The Market Absorption Study contains projected absorption as build out of production homes which varies from the absorption estimated by PCC III. See "THE COMMUNITY FACILITIES DISTRICT - Market Absorption Study" and APPENDIX D - "Summary Market Absorption Study." History of Property Tax Payment; Loan Defaults; Bankruptcy. PCC III has made the following representations: neither PCC Ill nor to PCC llI's actual knowledge of any of its current Affiliates (as defined in the Developer Continuing Disclosure Agreement attached hereto as Appendix G) has ever been delinquent in the payment of any ad valorem property taxes, special assessments or special taxes in any material amount, · neither PCC III nor any of its Affiliates is currently in material default on any loans, lines of credit or other obligation related to its development in the District or any of its other projects which default would in any way materially and adversely affect its ability to develop its property in the District as described 'n the Official Statement or to pay the Special Taxes for which it is responstble, · PCC I11 and its Affiliates are solvent and neither PCC III nor any of its current Affiliates has ever filed bankruptcy or been declared bankrupt, or has any proceeding pending or to PCC III's actual knowledge threatened in which PCC 111 or its Affiliates may be adjudicated as bankrupt, or discharged from any or all of its debts or obligations, and · no action, suit, proceedings, inquiry or investigations at law or in equity, before or by any court, regulatory agency, public board or body, is pendin~ (with service of process to PCC III or an Affiliate having been accomplished) against PCC III or any Affiliate or, to PCC lII's actual knowledge, threatened, which if successful, would materially advemely affect the ability of PCC III to complete the development and sale of the property currently owned within the District or to pay special taxes or ad valorem tax obligations when due on its property wahin the District. 41 Property Owner/Merchant Builder Estimated Special Tax Allocation by Property Ownership Based on the Appraisal, as of March 15, 2003 there were approximately 3 model homes and 31 production homes under construction by KB Home Coastal in the Knightsbridge project and 2 models and 17 production homes under construction by KB Home Coastal in the Hampton project. As of March 15, 2003, LENOne owns 439 lots, KB Home Coastal owns 212 lots, PCC 100 owns 100 lots Greystone Homes owns 17 [18 required under Option Agreement?] lots and PCC 1II owns 28 lots within the District. Based on agreements LENOne and PCC 100 have with certain of the Lennar Entities, the Lennar Merchant Builders in the aggregate would be responsible for approximately % of the estimated Fiscal Year 2003-04 Special Tax levy. KB Home Coastal and PCC II1 would be~ponsible for approximately % and % respectively, of the estimated Fiscal Year 2003-04 Special Tax levy. The actual allocation to LENO~and the Lennar Merchant Builders, KB Home Coastal and PCC Ill will depend on sales by LENOne to the Lennar Merchant Builders and sales by the Lennar Merchant Builders, KB Home Coastal and PCC III of completed homes to individual homeowners during the applicable period. Table 7 Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Owners of Taxable Property as of March 15, 2003 and Estimated Allocation of Special Tax Liability Fiscal Year 2003-04 Number Est. FY 2003-04 Percent of of Aggregate Tax Tract Name Units Acreage Special Tax Obligation°~ LENOne - US Home LENOne - Greystone Homes LENOne - Greystone Homes PCC 100- Lennar Homes LENOne - Greystone Homes KB Home Coastal - KB Home Coastal KB Home Coastal - KB Home Coastal PCC Ill - Pacific Century Homes Strut ford 114 % Nottingham 119 Astoria 111 Carlyle 100 Fairmont 112 Knightsbridge 127 Hampton 85 Estate lots 28 Total 796 100.00% (1) Total may not add due to rounding. Source: Alberta Webb /lssociates. Direct and Overlapping Debt Table 8 below sets forth the existing authorized indebtedness payable from taxes and assessments that may be levied within the District prepared by Albert A. Webb Associates and based on what was levied for Fiscal Year 2002-03 (the "Debt Report"). The Debt Report is included for general information purposes only. In certain cases, the percentages of debt calculations are based on assessed values, which will change significantly as sales occur and assessed values increase to reflect housing values. The District believes the information is current as of its date, but makes no representation as to its completeness or accuracy. Other public agencies, such as the City, may issue additional indebtedness at any time, without the consent or approvalof the District or the Authority. See "- Overlapping Assessment and Districts" below. The Debt Report generally includes long term obligations sold in the public credit markets by public agencies whose boundaries overlap the boundaries of the District in whole or in part. Such lon~ term obligations generally are not payable from property taxes, assessment or special taxes on land in the District. In many cases long term obligations issued by a public agency are payable only from the general fund or other revenues of such public agency. Additional indebtedness could be authorized by the District the City or other publ c agencies at any time. 42 The District has not undertaken to commission annual appraisals of the market value of property in the District for purposes of its Annual Reports pursuant to the Continuing Disclosure Agreement, and information regarding property values for purposes ora direct and overlapping debt analysis which may be contained in such reports will be based on assessed values as determined by the County Assessor. See Appendix F hereto for the form of the Continuing Disclosure Agreement. 43 Table 8 Temecula Public Finance Authority Community Facilities District No. 03-1 Detailed Direct and Overlapping Debt Assessed Value 11. Secured Property Tax Roll Total Description of Tax Bill METROPOLITAN WTR DEBT SV GO 390,760 $4,356,238 RCWD R DIV DEBT SERVICE GO 29,360 $6,4'/9,332 TOTAL PROPERTY TAX AS A PERCENTAGE OF FISCAL YEAR 2002-2003 ASSESSED VALUATION IlL Land Secured Bond Indebtedness $5,279.574 IV. General Obligation Bond Indebtedness TEMECULA UNIFIED B & I RCWD R DIV DEBT SERVICE METROPOLITAN WTR DEBT SV TOTAL GENERAL OBLIGATION BONDED DEBT; GO $65,000.(~3 855,750,0~0 0 070% 776 $39,010 GO $44,360,000 $10,330,315 0.244% 776 $25.238 GO $850,000,0~0 $503.075,000 0 CO0% 776 $2,272 $66.519 Additional bonded debt or available bond authorization may exist but is not shown because a tax was not levied for the referenced fiscal year. Proceeds from the 2003 Bonds will payoff the AD 159R assessment lien. 2003 Bond proceeds will finance facilities which could be financed by AD 159 Supplemental. The AD 159R lien and the AD 159 Supplemental lien will be released by the County. source: AlOert A. WeOb Associates. 44 Overlapping Assessment and Community Facilities Districts Additional Debt Payable from Taxes or Assessments. The District has no control over the amount of additional debt payable from taxes or assessments levied on all or a portion of the property within a special district which may be incurred in the future by other governmental agencies, including, but not limited to the County, the City or any other governmental agency having jurisdiction over all-or a portion of the property within theDistrict. Furthermore, nothing prevents the owners of property within the District from consenting to the issuance of additional debt by other governmental agencies which would be secured by taxes or assessments on a parity with the Special Taxes. To the extent such indebtedness is payable from assessments, other special taxes levied pursuant to the Act or taxes such assessments, special taxes and taxes will be secured by lens on the property within a d strict on a parity with a lien of the Special Taxes. Accordingly, the debt on the property within the District could increase, without any corresponding increase in the value of the property therein, and thereby severely reduce the ratio that exists at the time the 2003 Bonds are issued between the value of the property and the ~ebt secured by the Special Taxes and other taxes and assessments which may be levied on such property. The incurring of such a~ditional indebtedness could also affect the ability and willingness of the property owners within the District to pay the Special Taxes when due. Moreover, in the event of a delinquency in the payment of Special Taxes, no assurance can begiven that the proceeds of any foreclosure sale o,~the properly with, delinquent Special Taxes would be sufficient to pay the delinquent Special Taxes. See BONDOWNERS RISKS." Other Overlapping Direct Assessments Metropolitan Water District Standby. Property within the District is subject to a Metropolitan Water District Standby ("MWD Standby") assessment. The MWD Standby assessment is fixed unless there is a vote to increase the assessment. This pay-as-you-go assessment is used for water conservation programs, emergency programs, water treatment and capttal improvements such as transporting water from Colorado and Northern California to Southern California. The assessment levied for Fiscal Year [2002-03 is $6.94] per equivalent dwelling unit. Prior Lien; County of Riverside Assessment District No. 159R; County of~Riverside Assessment District No. 159 Supplemental. Property within the District is subject to a County of Riverside Assessment District No. 159R lien and the County of Riverside Assessment District No. 159 Supplemental lien. A portion of the proceeds of the 2003 Bonds will be used to prepay the outstanding lien of Assessment District No. 159R (i.e., the Prior Lien) relating to bonds 13reviously Issued with respect to Assessment District No. 159R and a portion of the proceeds o~'the 2003 Bonds wi'Il be used to finance facilities to which the non- bonded Assessment District No. 159 Supplemental lien pertains. The County has agreed to release the Assessment District No. 159R lien and to release any remaining Assessment District No. 159 Supplemental lien. Transportation Uniform Mitigation Fee The County of Riverside and the 14 cities in western Riverside County adopted, or are in the process of adopting, a new transportation fee for development, which adds approximately $6,650 to every new single- family house and aj~proximately $4,600 to cacti future apartment or condominium unit in the County, subject to credit for aport~on, if any, of transportation facility fees imposed by the County or applicable city which relates to facilities encoml~assed within the new transportation fee. New retail, service and industrial development will also be charged the transportation fee based on the square footage of new development ($8.90 per square foot for retai'I', $5.08 per square foot for service and $f.65 per square foot for industrial). The fee was approved by the County in February 2003. The fee was approved by the City on January 28, 2003, effective 61 days thereafter. The fee is being implemented by the other cities in the County between February 1, and June 1, 2003. Cities may opt out of the fee, but t~en they will not be able to receive any money from Measure A, the County's half-cent sales tax initiative. Extension of the term of Measure A was approved by the voters at the November 5, 2002 election. Measure A is estimated to cover more than 50% of the cost of maintaining cities' roads and streets. The half-cent sales tax l~rogram is now extended an additional 30 years and will expire in 2039. The Appraisal is based on comparable~[and sales which occurred before implementation of the Transportation Uniform Mitigation Fee. The effect of the Transportation Uniform Mitigation Fee on land values and sales prices cannot be determined at this time. Due to pre-existing agreements the property within the District is not subject to the Transportation Uniform Mitigation Fee. 45 Estimated Assessed Value-to-Lien Ratios The assessed values, direct and overlapping debt and total tax burden on individual parcels varies among parcels within the District. The value ofin3ividual parcels is significant because in the event ora delinquency in the payment of Special Taxes, the District may foreclose only against delinquent parcels. As of March 15, 2003, the parcels in the District have a value-to-lien ratio of approximately 4.9:1. Market Absorption Study Empire Economics, LLC, the market absorption consultant (the "Market Absor0tion Consultant") hasprepareda market analysis of the property in the Community Facilities District in its iMarket Absorption Study, dated November 2002 (the "Market Absorption Study"). Based upon its analysis of the expected demographic-economic trends, the Market Consultant estimated the District is expected to accommodate the 796 residential units at build-out by the first quarter of 2007. The Market Absorption Consultant's estimated absorption rates of the different categories of residential units are as follows: *Preliminary, subject to change. 46 Product Types / Projecu Table 9 Community Facilities District No. 03-1 (Crowne Hill) Projected Absorption November 2002 Residential Product Types Homes: Grey: Gray: US: Grey; PCC Ilk KB; KB: $247K $261K $320K $372K $365K $823K $253K $294K Residential Annually Cumul. Expected Budder Lennar Greystone Greystone US Home Gmystone Pacific KB Home KB Home Homes Homes Homes Homes Century Coastal Coastal Homes Lot Size - 5,000 6,000 7,200 8,500 9,000 40,000 5,000 7,000 Minimum Total 100 112 114 115 115 28 127 85 Sham 12.6% 14 1% 14.3% 14.4% 14.4% 3.5% 16,0% I0.7% Commence Early Early Early Early Early Early Mid-2003 Mid-2003 Closings 2004 2004 2004 2004 2004 2004 $227,990 $235,000 $263,990 $349,990 $345,000 $700,000 $236,890 $271,390 $248,190 $261,000 $320,390 $371,990 $365,000 $823,333 $252,760 $293,930 $276,990 $289,000 $364,990 $389,990 $385,000 $925,000 $266,790 $318,540 Housing Prices Lower Average Upper Living Area Lower 1,961 1,760 2,139 3,200 3,000 4,300 1,582 2,268 Average 2,440 2,374 3,309 3,700 3,450 5,333 2,159 2,809 Upper 3,092 3,092 4,114 4,200 3,950 6,500 2,725 3,470 Value Ratio $101 $110 $97 $101 $106 $154 $117 $105 796 100.0% 100.0% Absorption: 2003 0 0 0 0 0 0 50 50 2004 55 50 45 40 40 6 55 35 2005 45 55 50 45 45 8 22 0 2006 0 7 19 30 30 8 0 0 100 100 326 426 270 696 94 790 ~ 796 Totals 100 112 114 115 115 28 127 85 796 47 The Market Absorption Study is subject to a number of assumptions and limiting conditions. See APPENDIX D - "Summary Market Absorption Study" for a discussion of the assumptions and limit conditions of the Market Absorption Study. Appraised Property Value An appraisal prepared by an MAI appraiser of the land and existing improvements for the development within the District dated M,a, rch 19, 20,0,3 (the "Appraisal"), has been prepared by Stephen G. White, MAlofFullerton, Califomia(the Appraiser ) in connection with issuance ofthe 2003 Bonds. The purpose of the appraisal was to estimate the market value of each of the 8 tracts reflecting the as is condition of the lots within each tract as well as the homes which are completed or under construction. The Appraisal also reflects the proposed District financing together with the overall tax rate to future homeowners of approximately 1.8 to 1.9%, including the Special Taxes. The subiect property includes property proposed for development of 796 single family residential lots. The Appraisal is based on certain assumptions. Subject to these assumptions, the Appraiser estimated that the fee simple market value of the Taxable Property within the District (subject to the lien of the Special Taxes) as of March 15, 2003, was as follows: Tract Name Builder No. of Lots Market Value Stratford US Home 114 $12,460,000 Nottingham Greystone Homes 119 12,860,000 Astoria Greystone Homes 111 13,000,000 Carlyle Lennar Homes 100 9,630,000 Fairmont Greystone Homes 112 10,920,000 Knightsbridge KB Home Coastal 127 13,880,000 Hampton KB Home Coastal 85 10,980,000 Estate Lots Pacific Century Homes 28 4,790,000 796 $88,520,000 The Appraisal estimated the value of the property in the District as "finished lots," that is, lots that are fully improved and ready for homes to be built. Thts reflects that the lots have had fine grading, all in-tract streets and utilities have been completed and fees have beenj>aid or credited (sewer, water, road, library, park, school, etc.) up to the stage of pulling building permits (whmh, as described in "Property Ownership"above, is not yet the condition olthe property within the District) less the remaining cost to the merchant builders to achieve finished lots (based on the status of the development process as of March 15 2003). The estimate of value was based on fee simple ownership, subject only to easements of record and the lien of the Special Taxes and other special tax and assessment liens. The Appraiser used a sales comparison approach to estimate the value of the land as if in a finished condition, being finished single family lots or rough graded superpads. This al~proach compares recent sales of similar residential land in the general area to the subject property, considenng pertinent differences from the sales to the land. Then, a deduction is made for the estimated remaining costs and fees to get the land from its as is condition to finished lots or superpads. In addition, a deduction is made for allremaining community infrastructure cost which are the burden of the merchant builders, including grading, utilities, recreational amenities, etc. The District makes no representation as to the accuracy or completeness of the Appraisal. See Appendix C hereto for more information relating to the Appraisal. The fee simple market value includes the value of extensive grading and infrastructure improvement as of the date of value and the improvements to be financed by the 2003 Bonds. The market values reported 48 in the Appraisal result in an estimated value-to-lien ratio of 4.9:1,' calculated with respect to the 2003 Bonds and excluding the overlapl~in~ assassmant debt relating to the Prior Lien. The value-to-lien ratios ofindividual parcels will differ from the foregoing aggregate value. See "BONDO~ERS' RiSKS - Burden of Parity Liens, Taxes and ,,O~her Special Assessments on the Taxable Property and ["BONDOWNERS' RiSKS - Appraised Values herein and APPENDIX C - "Summary AppraisalReport" appended hereto for further information on the Appraisal and for limiting conditions relating to the Appraisal. BONDOWNERS' RISKS In addition to the other information contained in this Official Statement, the £ollowing risk factors should be carefully considered in evaluating the investment quality of the 2003 Bonds. The .4 uthority cautions prosp, ective investors that this discussion does not purport to be comprehensive or definitive, the risk factors are listed in no particular order of importance, and does not purport to be a complete statement of all factors which may be considered as risks in evaluating, the credit quality pf the 2003 Bonds. The occurrence of one or more of the events discussed herein could adversely affect the ability or willingness of property owners in the District to pay their Special Taxes when due. Any such failure to pay Special Taxes could result in the inability of the Authority to make full and punctual pa~ments of debt service on the 2003 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. Risks of Real Estate Secured Investments Generally The Bondowners 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 and/or sites in the event of sa e or foreclosure; (, i) changes in real estate tax rate and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relating to endangered species and hazardous materials) and fiscal policies; and (iii) natural disasters (including, without limitation, earthquakes and floods), which may result in uninsured losses. Concentration of Ownership As of the date hereof, the major landowners (LENOne, Greystone Homes, PCC 100, KB Home Costal and PCC lid are responsible for 100% percent of the Special Taxes and the Lennar Merchant Builders are responsible for payment of Special Taxes under agreements with LENOne and PCC 100. If any such ent ty fads in its obligatmns under the applicable agreements or if any such entity is unwilling or unable to pay the Special Tax when due, a potential shortfall in the Bond Fund could occur, which would result in the depletion of the Reserve Fund 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 2003 Bonds. No property owner is obligated in any manner to continue to own and/or deve op an,v of the land it presently owns within the District. The Special Taxes are not a personal obligation of any m~lor landowner, any merchant builder or 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 installments or that it will choose to pay even if financially able to do so. Failure to Develop Properties Development of property within the District may be subject to economic considerations and unexpected delays, disruptions and changes which may affect the willingness and ability of the merchant builders or any property owner to pay the Special Taxes when due. Land development is also subject to comprehensive federal, State and local regulations. Approval is re,quired from various agencies in connection with the layout and design of developments, the nature and extent of ~mprovements, construction activity, land use, zoning, school and health requirements, as well as numerous other matters. As of December 31,2001, final maps have been recorded for all but the 28 custom estate lots. The property within the District is partially developed with public infrastructure improvements and construction, some of which are substantialIy complete; however, additional approvals are necessary to *Preliminary, subject to change. 49 complete the development. See "Government Approvals" below. It is possible that the approvals necessary to complete development of the property within the District will not be obtained on a timely basis. Failure to obtain any such approval could adversely affect land development operations within the District. In addition, there is a risk that future governmental restrictions on land development within the District will be enacted either directly by a governmental entity with jurisd ction or by the voters through the exercise of the initiative power. The failure to complete the development or the required infrastructure in the District or substantial delays in the completion of the development or the required infrastructure for the development due to litigation, the inability to obtain required funding, failure to obtain necessary governmental approval or other causes may reduce the value of the property within the District and increase the length of time during which Special Taxes will be payable from Undeveloped Property, and may affect the willingness and ablqity of the owners of property within the District to pay the Special Taxes when due. See "SEC"URITY FOR T~tE 2003 BONDS." Bondowners should assume that any event that significantly impacts the ability to develop land in the District would cause the property values within the District to decrease substantially and could affect the willingness and ability of the owners of land within the District to pay the Special Taxes when due. Special Taxes Are Not Personal Obligations The owners of land within the District are not personally liable for the l~ayment of the Special Taxes. Rather, the Special Tax is an obligation only of the landwithin the District. If the value of the land within the District is not sufficient to fully secure the Special Tax, then the District has no recourse against the owners under the laws by which the Special Tax has'oeen levied and the 2003 Bonds have been issued. The 2003 Bonds Are Limited Obligations of the District The District has no obligation to pay principal of and interest on the Bonds in the event Sl>ecial Tax collections are delinquent, other than from amounts, ~fany, on deposit in certain funds and accounts held under the Fiscal Agent Agreement or funds derived from the tax sale or foreclosure and sale of parcels on which levies of the Special-Tax are delinquent, nor is the District obligated to advance funds to pay such debt service on the Bonds. Appraised Values The Appraisal summarized in .Appendix C hereto estimates the fee simple interest market value of the Taxable Property within the District. Thts value is merely the present opinion of the Appraiser, and is qualified by the Appraiser as stated in the Appraisal. The Authority has not sought the present opinion of any other appraiser of the value of the Taxable Property. A different present opinion of such value might be rendered by a different appraiser. The opinion of value relates to sale by a willing seller to a willing buyer, each having similar information and neither being forced by other circumstances to sell nor to buy. Consequently, the opinion is of limited use in predicting the selling price at a foreclosure sale because the sale is forced and the buyer may not have the benefit of full information. In addition, the opinion is a present opinion. It is based upon present facts and circumstances. Differing facts and circumstances may lead to differing opinions of val-ue. The appraised market value is not evidence of future value because future facts and circumstances may differ significantly from the present. See "THE COMMUNITY FACILITIES DISTRICT - Transportation Uniform Mitigation Fee" for a description of a new fee relating to all development within western Riverside County which may affect market values. No assurance can be given that if any of the Taxable Property in the District should become delinquent in the payment of Special Taxes and be foreclosed upon, that such property could be sold for the amount of estimated market value thereof contained in the Appraisal. Land Development A major risk to the Bondowners is that development by the property owners in the District may be subject to unexpected delays, disruptions and changes which may affect the willingness and ability of the l~roperty owners to pay Special Taxes when due. For example, proposed development within a portion of the District could be advemely affected by delays in or the inability to obtain final environmental clearances required in connection with particular parcels of property, unfavorable economic conditions, competing 50 development projects, an inability of the current owners or future owners of the parcels to obtain financing, fluctuations in the real estate market Or interest rates, unexpected increases in development costs, changes in federal, state or local governmental policies relating to the ownership of real estate faster than expected depletion of existing water allocations, the appearance of previously unknown environmental impacts necessitating preparation of a supplemental environmental impact report, and by other similar factors. There can be no assurance that land development operations within the District will not be adversely affected by the factors described above. In addition, partially developed land is less valuable than developed land and provides less security for the 2003 Bonds (and therefore to the Bondowners) should it be necessary for the D~strict to foreclose on undeveloped property due to the nonpayment of Special Taxes. Moreover, failure to complete future development on a timely basis could adversely affect the land values of those parcels which have been completed. Lower land values result in less security for the payment of principal of and interest on the 2003 Bonds and lower proceeds from any foreclosure sale necessitatedby delinquencies in the payment of the Special Taxes. Furthermore, an inabilit~ to develop the land within the District as planned will reduce the expected diversity of ownership of land within the District, making thepayment of debt service on the 2003 Bonds more dependent upon timely payment of the Special Taxes leviedon the undeveloped property. Because of the concentration of undeveloped property ownership, the timely payment of the 2003 Bonds depends upon the willingness and ability of the current owners of undeveloped [and and any merchant builders to whom finished lots are sold topay the Special Taxes levied on the undeveloped landwhen due. Furthermore, continued concentration of ownership increases the potential negative impact of a bankruptcy or other financial difficulty experienced by the existing landowners. See "Concentration of Ownership" above. Burden of Parity Liens, Taxes and Other Special Assessments on the Taxable Property While the Special Taxes are secured by the Taxable Property the security only extends to the value of such Taxable Property that s not subject to priority and parity liens and similar claims. The table in the section entitled "THE COMMUNITY FACILITIES DISTRICT - Direct and Overlapping Debt" states the presently outstanding amount of governmental obligations (with stated exclusions), the tax or assessment for which is or may become an obligation of one or more of theparcels of Taxable Property, and furthermore states the additional amount of general obligation bonds the tax for which, if and when issued, may become an obligation of one or more of the parcels of Taxable Property. The table does not specifically identify which of the governmental obligations are secured by liens on one or more of the parcels of Taxable Property. 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 of Taxabte Property and may be secured by a lien on a parity with the lien of the Special Tax securing the 2003 Bonds. In general the Special Tax and all other taxes, assessments and charges collected on the County 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. In the event of proceedings to foreclose for delinquency of Special Taxes securing the 2003 Bonds, the Special Tax will be subordinate only to existing prior governmental liens, if any. Otherwise, in the event of such foreclosure proceedings, the Special Taxes will generally be on a parity with the other taxes, assessments and charges, and will share the proceeds of such foreclosure proceedings on a pro-rata basis. Although the Special Taxes will generally have priority over non-governmental liens on a parcel of Taxable Property regardless of whether the non-governmental liens were in existence at the time of the levy of the Special Tax or not, this result may not apply in the case of bankruptcy. While governmental taxes, assessments and charges are a common claim against the value ora parcel of Taxable Property, other less common claims may be relevant. One of the most serious in terms of the potential reduction ~n the value that may be realized to pay the Special Tax is a claim with regard to a hazardous substance. See "Hazardous Substances" below. Disclosure to Future Purchasers The District has recorded a notice of the Special Tax lien in the Office of the Riverside County Recorder on May ,2003, as Document No. 2003- . While title companies normally refer to such notices in title rep~ffs, there can he no guarantee that~nce will be made or, if made, that a prospective 51 purchaser or lender will consider such Special Tax obligation in the purchase of a parcel of land or a home in the District or the lending of money thereon. The Act requires the subdivider (or ~ts 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 ustng 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 make agood faith effort to notify the prospective purchaser of the special tax lien in a format prescribed by statute. Failure b2/an owner of the property to comply with the above refluirements, or failure by a purchaser or lessor to consider or understandthe 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. Government Approvals The current landowners or their predecessors have secured most discretionary approvals, permits and government entitlements necessary to develop the land within the District. Nevertheless, development within the District is contingent upon the construction of a number of major public improvements as well as the necessary local in-tract improvements. The installation of the necessary improvements and infrastructure is subject to the receipt of construction or building permits from the City and ot~her public agencies. The failure to obtain any such approval could adversely affect construction within the District. A slow down or stoppage of the construction process could adversely affect land values. No assurance can be given that permits w~lbe obtained in a timely fashion if at all. The failure to do so may result in the prevention or significant delays n the development of the property within the District or portions thereof. See "Failure to Develop Properties" herein. Local, State and Federal Land Use Regulations There can be no assurance that land development operations within the District will not be adversely affected by future government policies, including, but not limited to, governmental policies which directly or indirectly restrict or control development. During the I~ast several years, citizens of a number of local communities in California have placed measures on the ballot designed to control the rate of future development. During the past several years, state and federal regulatory agencies have significantly expanded their involvement in local land use matters through increased regulatory enforcement of various environmental laws, including the Endangered Species Act, the Clean Water Act and the Clean Air Act, among others. Such regulations can substantially impair the rate and amount of development without requiring just compensation unless the effect of the regulation is to deny all economic use of the affected property. Bondowners should assume that any event that significantly impacts the ability to construct homes on land in the District could cause the land values within the District to decrease substantially and could affect the willingness and ability of the owners of land to pay the Special Taxes when due or to proceed with development of land in the District. See "Failure to Develop Properties" herein. Endangered and Threatened Species It is illegal to harm or disturb any plants or animals in their habitat that have been listed as endangered species by the United States Fish & Wildlife Service under the Federal Endangered SI3ecies Act or by the California Fish & Game Commission under the California Endangered Species ~ct without a permit. Thus, the presence of an endangered plant or animal could delay development of undeveloped property in the District or reduce the value of undeveloped property. Failure to develop the undeveloped property in the District as planned, or substantial delays in the completion of the planned development of the property may. increase the amount of Special Taxes to be paid by the owners of'undeveloped property and affect the w~llingness and ability of the owners of l~rol~erty within the District to pay the Special-Taxes when due. See "THE COMMUNITY FACILITIES DISTRICT - Environmental Conditions." Hazardous Substances While governmental taxes, assessments, and charges are a common claim against the value of a taxed parcel, other less common claims may be relevant. One of-the most serious in terms of the potential reduction ~n the value that may be realized to pay the Special Tax is a claim with reg~ard to hazardous substances. In general, the owners and operators of parcels w~thin the District may be reqmred by law to remedy conditions of the parcels related to the releases or threatened releases of hazardous substances. The federal Comprehensive Env,?,onmental Resp,,onse, Compensation, and Liability Act of 1980, sometimes referred to as "CERCLA" or the Superfund Act,' is the most well-known and widely applicable of these laws but California laws with regard to hazardous substances are also stringent and siml~lar. Under many of these laws, the owner (or operator) is obligated to remedy a hazardous su~ostances condition ora property whether or not the owner (or 52 operator) has anything to do with creatingor handling the hazardous substance. The effect, therefore, should any parcel within theDistrict be affectedby a hazardous substance, would be to reduce the marketability and value of the parcel by the costs of remedying the condition, because the owner (or operator) is obligated to remedy the condition. Further, such liabilities may arise not simply from the existence of a hazardous substance but from the method of handling or disposing of it. All of these possibilities could significantly affect the financial and legal ability of a property owner to develop the affected parcel or other parcels, as well as the value of the property that is realizable upon a delinquency and foreclosure. The assessed value of the property within the District does not take into account the possible reduction in marketability and value of any of the parcels of Taxable Property by reason of the possible liability of the owner (or operator) for the remedy of a hazardous substance condition of the parcel. The District has not independently verified and is not aware that the owner (or operator) of any of the parcels of Taxable Property has such a current liability with respect to any such parcels of Taxable Property, except as expressly noted. However, it is possible that such liabilities do currently exist and that the District is not aware of them. Further, it is possible that liabilities may arise in the future with respect to any of the parcels of Taxable Property resulting from the existence, currently, on the parcel ora substance presently classified as hazardous but which 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 which 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 or disposing of it. All of these possibilities could significantly affect the value of a parcel of Taxable Property that is realizable upon a delinquency. See"THE COMMUNITY FACILITIES DISTRICT - Environmental Conditions" herein for a description of the prior use of the property. Levy and Collection of the Special Tax The principal source of payment of principal of and interest on the 2003 Bonds is the proceeds of the annual levy and collection of the Special Tax against property within the District. The annual levy of the Special Tax is subject to the maximum tax rates authorized. The levy cannot be made at a higher rate even if the failure to do so means that the estimated proceeds of the levy and collection of the Specihl Tax, together with other available funds, will not be sufficient to pay debt service on the 2003 Bonds. Other funds which might be available include funds derived from the payment of penalties on delinquent Special Taxes and funds derived from the tax sale or foreclosure and sale of parcels on which levies of the Spec'iai Tax are delinquent. The levy of the Special Tax will rarely, if ever, result in a uniform relationship between the value of particular taxed parcels and the amount of the levy of the Special Tax against such parcels. Thus, there will rarely, if ever, be a tmiform relationship betweenthe value of such parcels and the proportionate share of debt service on the 2003 Bonds, and certainly not a direct relationship. The Special Tax levied in any particular taxyear on a parcel of Taxable Properly is based upon the revenue needs and application of the Rate and Methoc]. Application of the Rate and Method wilt, in turn, be dependent upon certain development factom with respect to each parcel of Taxable Property by comparison with similar development factom with respect to the other parcels of Taxable Property within the District. Thus, in addition to annual variations of the revenue needs from the Special Tax the following are some of the factors which might cause the levy of the Special Tax on any particular parcel of Taxable Property to vary from the Special Tax that might otherwise be expected: (1) Reduction in the number of parcels of Taxable Property, for such reasons as acquisition of parcels of Taxable Property by a government and failure of the government to pay the Special Tax based upon a claim of exemption or, in the case of the federal government or an agency thereof, immunity from taxation, thereby resulting in an increased tax burden on the remaimng parcels of Taxable Property. (2) Failure of the ownem of parcels of Taxable Property to pay the Special Tax and delays in the collection of or inability to collect the Special Tax by tax sale or foreclosure sale of the delinquent parcels, thereby resulting in an increased tax burden on the remaining parcels. Except as set forth above under "SECURITY FOR THE 2003 BONDS - Special Taxes" and "- Rate and Method" herein, the Fiscal Agent Agreement provides that the Special Tax is to be collected in the same manner as ordinary ad valorem propertytaxes are collected and excel>t as provided in the special covenant for foreclosure described n SECURITY'FOR THE 2003 BONDS - Proceeds of Foreclosure Sales and In the Act, is subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is 53 provided for ad valoremproperty taxes. Pumuant to these procedures, if taxes are unpaid, the property is then ~s subject to sale by the District. In addition, the Rate and Method limits the increase of Special Taxes 1,e, vied on parcels of Developed Property to cure delinquencies of other property owners in the District. See SECURITY FOR THE 2003 BONDS - Rate and Method" herein. Insufficiency of the Special Tax The principal source of payment of principal of and interest on the 2003 Bonds is the proceeds of the annual levy and collection of the Special Tax against property within the District. The annual levy of the Special Tax is subject to the maximum tax rates authorized. The levy cannot be made at a higher rate even if the failure to do so means that the estimated proceeds of the levy and collection of the Special Tax, together with other available funds, will not be sufficient to pay debt service on the 2003 Bonds. Other funds which might be available include funds derived from the payment of penalties on delinquent Special Taxes and funds derived from the tax sale or foreclosure and sale of parcels on which levies of the Special Tax are delinquent. The levy of the Special Tax will rarely, if ever result in a uniform relationship between the value of particular Taxable Property and the amount oft'he levy of the Special Tax against such parcels. Thus, there will rarely, if ever, be a tm[form relationship between the value of such parcels and the proportionate share of debt service on the 2003 Bonds, and certainly not a direct relationship. The Special Tax levied in any particular tax year on a Taxable Property is based upon the revenue needs and the application of the Rate and Method, including the effects of the applicable Zone's Minimum Annual Special Tax Re~tuirement. Application of the Rate and Method will, in turn, be dependent upon certain development factors w~th respect to each Taxable Property by comparison with similar development factors with respect to the other Taxable Property within the District. Thus, in addition to annual variations of the revenue needs from the Special Tax the following are some of the factors which might cause the levy of the Spec al Tax on any part cu ar Taxable Property to vary from the Special Tax that might otherwise be expected: (1) Reduction in the amount of Taxable Property, for such reasons as acquisition of Taxable Property by a government and failure of the government to pay the Special Taxbased upon a claim of exemption or, in the case of the federalgovemment or an agency thereof, immunity from taxation, thereby resulting in an increased tax burden on the remaining parcels of Taxable Property; or (2) Failure of the owners of Taxable Property to pay the Special Tax and delays in the collection of or inability to collect the Special Tax by tax sale or foreclosure and sale of the delinquent parcels, thereby resulting in an increased tax burden on the remaining parcels of Taxable Property in the applicable Zone. . Es~,ept as set forth above trader "SECURITY FOR THE 2003 BONDS - Special Taxes" and "- Rate and Methoa nerein, me Fiscal Agent Agreement provides that the Special Tax s to be collected in the same manner as ordinary ad valorem property taxes are collected and except as provided in the special covenant for foreclosure described in SECURITY FOR THE 2003 BONDS - Proceeds of Foreclosure Sales" and in the Act, is subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as is provided for ad valorem property taxes. Pursuant to these procedures, if taxes are unpaid for a period of five years or more, the property ~s subject to sale by the County. In the event that sales or foreclosures of property are necessary, there could be a delay in payments to owners of the 2003 Bonds pending such sales or tlae prosecution of foreclosure proceedings and receipt bythe Authority of the proceeds of sale ifthe Reserve Fund is depleted. See "SECURITY FOR THE 2003 BONDS - Proceeds of Foreclosure Sales." In addition, the Rate and Method limits the increase of Special Taxes levied on parcels of Developed Property in a Zone to cure delinquencies of other property owners in the same Zone of the District. See "SECURITY FOR THE 2003 BONDS - Rate and Method"herein. Exempt Properties ,, Certain properties are exempt from the Special Tax in accordance with the Rate and Method (see SECURITY FOR THE 2003 BONDS - Rate and Method" herein). In addition, the Act provides that properties or entities of the state, federal or local government are exempt from the Special Tax provided, however, that property within the D str ct acquired by a public entity through a negotiated transaction or by girl 54 or devise, which is not otherwise exempt from the Special Tax, will continue to be subject to the Special Tax. It is possible that property acquired by a public entity following a tax sale or foreclosure based upon failure to pay taxes could become exempt from the Special Tax. In addition, although 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, the conshtutionality and operation otthese provisions of the Act have not been tested, meaning that such property could become exempt from the Special Tax. In the event that additional property is dedicated to the C~ty or other public entities, this additional property might become exempt from the Special Tax. The Act further provides that no otherproperties or entities are exempt from the Special Tax unless the properties or entities are expressly exemptedin a resolution of consideration to levy a new special tax or to alter the rate or method of apportionment of an existing special tax. Depletion of Reserve Fund The Reserve Fund is to be maintained at an amount equal to the Reserve Requirement (see "SECURITY FOR THE 2003 BONDS - Reserve Fund" herein). Funds in the Reserve Fund may be used to pay principal of and interest on the 2003 Bonds in the event the proceeds of the levy and collection of the Special Tax against property withinthe Districtisinsufficient. lffundsintheReserveFund for the2003 Bonds 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 j~ay all amounts to be paid to the Bondowners pursuant to the Fiscal Agent Agreement. However, no replemshment from the proceeds of a Special Tax levy can occur as long as the proceeds that are collected from the levy of the Special Tax against property within the District at the maximum tax rates, together with other available funds, remains insufficient to pay all such amounts. Thus it is possible that the Reserve Fund will be depleted and not be replenished by the levy of the Special Tax. Potential Delay and Limitations in Foreclosure Proceedings 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 Stat,e, relating to judicialf0reclosure. See "SECURITY FOR THE 2003-BONDS - Proceeds of Foreclosure Sales' and "BONDOWNERS' RISKS - Bankruptcy and Foreclosure Delay" herein. In addition, the prosecution of a foreclosure could be delayed due to many reasons, including crowded local court calendars or lengthy procedural delays. The ability of the District to collect interest and penalties specified by State law and to foreclose against properties having delinquent Special Tax installments ma), be limited in certain respects with regard to properties in which the Federal Deposit Insurance Corporation (the "FDIC") has or obtains an interest. The FDIC would obtain such an interest by taking over a financial institution which has made a loan which is secured by property within the District. The FDIC has adopted a policy statement regarding the payment of state and local real property taxes (the "Policy Statement") which provides that the FDIC intends to pay valid real property taxes, interest and penalties, in accordance with state law, on property which at the time of the tax levy is owned by a financial tnstitution in an FDIC receivership, unless abandonment of the FDIC interest is determined to be appropriate. However, the Policy Statement is unclear as to whether the FDIC considers special taxes such as the Special Taxes to be "real property taxes" which it intends to pay. Furthermore, the Policy Statementprovides that, with respect to parcels on which the FDIC holds a mortgage lien, it will not permit its lien to be foreclosed by a taxing authority without its specific consent and that it will not pay or recognize liens for any penalties, fines, or simi ar claims imposed for the non-payment of taxes. The Authority and the District are unable to predict what effect the apl~lication of the Policy Statement would have in the event of a delinquency on a l~arce~l within the District in ~vhich the FDIC has or obtains an interest, although prohibiting the lien of the FDIC to be foreclosed at a judicial foreclosure sale would likely reduce or eliminate the persons willing to purchase a parcel at a foreclosure sale. In addition, potential investors should be aware that judicial foreclosure proceedings are not summary remedies and can be subject to significant procedural and other delays caused by crowded court calendars and other factors beyond control of the Authority or the District. Potential investors should assume that, under current conditions, it is estimated that a judicial foreclosure of the lien of Special Taxes will take up to two or three years from initiation to the lien foreclosure sale. At a Special Tax lien foreclosure sale, each parcel will be sold for not less than the "minimum bid amount" which is equal to the sam of all delinquent Special Tax 55 installments, penalties and interest thereon, costs of collection (including reasonable attorneys fees), pos - judgment interest and costs of sale. Each parcel is sold at foreclosure for the amounts secured by the Special Tax lien on such parcel and multiple parcels may not be aggregated in a single "bulk" foreclosure sale. If any parcel fails to obtain a "minimumbid," the Authority may, but ~s not obligated to, seek superior court approval to sell such parcel at an amount less than the minimum bid. Such Superior Court approvalrequires the consent of the owners of 75% of the aggregate principal amount of the Outstanding Bonds. Bankruptcy and Foreclosure Delay The payment of Special Taxes and the ability of the District to foreclose the lien of a delinquent Special Taxes as discussed in the section herein entitled"SECURITY FOR THE 2003 BONDS" may be limited by bankruptcy, insolvency, or other laws generally affecting creditors' rights or by the laws of the State relating to judicial foreclosure. In addition, the prosecution of a judicial foreclosure may be delayed due to congested local court calendars or procedural delays. The various legal opinions to be delivered concurrently with the delivery of the 2003 Bonds {including Bond Counsel's approving legal opinion) will be qualified, as to the enforceability of the various legal instruments, by moratorium, bankruptcy, reorganizatfon, insolvency or other similar laws affecting the rights of creditors generally. Although bankruptcy proceedings would not cause the obligation to pay the Special Tax to become extinguished, bankruptcy ora property owner or of a partner or other equity owner of a properly owner, could result in a stay of enforcement of the lien for the Special Taxes, a delay in prosecuting Superior Court foreclosure proceedings or adversely affect the ability or willingness of a property owner to pay the Special Taxes and could result in the possibility of delinquent Special Taxes not being paid in full. In addition, the amount of any lien on property securing the payment of delinquent Special Taxes could be reduced if the value of the property were determined by the bankruptcy court to have become less than the amount of the lien, and the amount ot the delinquent Spectal Taxes in excess of the reduced lien could then be treated as an unsecured claim by the court. Any such stay of the enforcement of the lien for the Special Tax, or any such delay or non- payment, would increase the likelihood of a delay or default in payment of the principal of and interest on the 2003 Bonds and the possibility of delinquent Special Taxes not being paid in full Moreover, amounts received upon foreclosure sales may not be sufficient to fully discharge delinquent installments. To the extent that a significant percentage oftl~e property in the District is owned'oy any major landowner, any merchant builders or any other properly owner, and such owner is the subject of bankruptcy proceedings, the payment of the Special Tax and the ability of the Authority to foreclose the lien ora delinquent unpaid Special Tax could be extremely curtailed by bankruptcy, insolvency, or other laws generally affecting creditors' rights or by the laws of the State relating to judicial foreclosure. On July 30, 1992, the United States Court of Appeals for the Ninth circuit issued its opinion in a bankruptcy case entitled In re Glaspl? Marine Industries. In that case, the court held that ad valorem property taxes levied by Snohomish County in the State of Washington after the date that the pr.oj~erty owner filed a petition for bankruptcy were not entitled to priority over a secured creditor with a prior hen on the property. The court upheld the priority of unpaid taxes imposed after the filing of the bankruptcy petition as "administrative expenses" of the bankruptcy estate, payable after all secured-creditors. As a result, the secured creditor was to foreclose on the property and retain all of the proceeds of the sale except the amount of the pre- petition taxes. According to the court's ruling, as administrative expenses, post-petition taxes would have to be paid, assuming that the debtor has sufficient assets to do so. In certain circumstances,payment of such administrative expenses may be allowed to be deferred. Once the property is transferred out olthe bankruptcy estate (through foreclosure or otherwise) it would at that time become subject to current ad valorem taxes. The Actprovides that the Special Taxes are secured by a continuing lien, which is subject to the same lien priority in the case of delin.quency as ad valorem taxes. No case law exists with respect to how a bankruptcy court would treat the hen for the Special Taxes levied after the filing of a petition ~n bankruptcy. Glasply is controlling precedent for bankruptcy courts in the State. lfthe Glasply precedent was applied to the levy of the Special Tax, the amount of Special Tax received from parcels whose owners declare bankruptcy could be reduced. It should also be noted that on October 22, 1994, Congress enacted l 1 U.S.C. Section 362(b)(t8), which added a new exception to the automatic stay for ad valorem property taxes imposed by a political subdivision after the filing of a bankruptcy petition:Pursuant to this new provision of law in the event ora bankruptcy petition filed on or after October 22, 1994, the 1 en for ad valorem taxes in subsequent fiscal years 56 will attach even if the property ispart of the bankruptcy estate. Bondowners should be aware that the potential effect of 11 U.S.C. Section 362(b)(18) on the Special Taxes depends upon whether a court were to determine that the Special Taxes should be treated like ac[valorem taxes for this purpose. Payments by FDIC and Other Federal Agencies The ability of the Authority to collect interest and penalties specified by state law and to foreclose the lien of delinquent Special Taxes may be limited in certain respects with regard to properties in which the FDIC, the Drug Enforcement Agency, the Internal Revenue Service or other similar federal governmental agencies has or obtains an interest. Specifically with respect to the FDIC on June 4, 1991, the FDIC issued a Statement of Policy Regarding the Payment of State and Local Property Taxes (the "1991 Policy Statement"). The 1991 Policy Statement was revised and supemeded by a new Policy Statement effective January 9, 1997 (the "Policy Statement"). The Policy Statement provides that real property owned by the FDIC is subject to state and local real property taxes only if those taxes are assessed according to the property's value, and that the FDIC is immune from realproperty taxes assessed on any basis other than property value. According to the Policy Statement the FDI-C will pay its property tax obligations when they become due and payable and will pay claims for delinquent property taxes as promptly as ~s consistent withsound bu,s, iness practice and the orderly administration of the institution's affairs, unless abandonment of the FDIC s interest in the property ~s appropriate. The FDIC will pay claims for interest on delinquent property taxes owed at the rate provided under state law, to the extent the interest payment obligation is secured by a valid lien. The FDIC will not pay any amounts in the nature of fines or penalties and will not pay nor recognize liens for such amounts. If any property taxes (includinginterest) on FDIC owned property are secured by a valid lien (in effect before the property became owned by the FDIC), the FDIC will pay those claims. The Policy Statement further provides that no property of the FDIC is subject to levy attachment garnishment, foreclosure or sale without the FDIC's consent. In addition, the FDIC will not permit a lien or security nterast held by the FDIC to be eliminated by foreclosure without the FDIC's consent. The Policy Statement states that the FDIC generally will not pay non ad valorem taxes, including special assessments, on property in which it has a fee ~nterest unless the amount of tax is fixed at the time that the FDIC acquires its fee interest in the property, nor will it recognize the validity of any lien to the extent it purports to secure the payment of any such amounts. Special taxes imposed under the Act and a special tax formula which determines the specialtax due each year, are specifically identified in the Policy Statement as being imposed each year and therefore covered by the FDIC's federal immunity. With respect to property in California owned by the FDIC on January 9, 1997and that was owned by the RTC on December 31, I995, or that became the properly of the FDIC through foreclosure of a security interest held by the RTC on that date, the FDIC will continue the RTC's prior practice of paying special taxes imposed pursuant to the Act if the taxes were imposed prior to the RTC's acquisition of an interest in the property. All other special taxes may be challenged by the FDIC. The FDIC has filed claims against the County of Orange with respect to Mello-Roos District special taxes in the United States Bankruptcy Court and in Federal District Court in which the FDIC has tal~en a position similar to the position outlined in the Policy Statement. While all of such claims have not been resolved, the Bankruptcy Court has issued a tentative ruling in favor of the FDIC on certain of such claims. The County of Orange has appealed such rulinff and the FDfC has cross-appealed. The decision of the United States Court of Appeals for the 9~ Circuit (tl~e "9th Circuit Court") was filed on August 28, 2001. In its decision, the Court stated that the FDIC, as a federal agency, is exempt from the Mello-Roos Special Tax. The FDIC has also filed suit (the "post-bankruvtcy" suit) regarding special taxes imr>osed after 1994. However, such action has been stayed pending reso'lut~on of the 9th Circmt Court appeaf by the FDIC regarding the bankruptcy case. The post-bankruptcy suit has recently been consolidated with the cases filed by the FDIC against other California counties and is pending in the United States District Court in Los Angeles. The FDIC has filed a motion to lift the bankruptcy stay. The Authority is unable to predict what effect the application of the Policy Statement would have in the event of a delinquency on aparcel within the District in wh'~ch the FDIC has or obtains an interest although prohibiting the lien of the FDIC to be foreclosed at a judicial foreclosure sale would reduce or eliminate the persons willing to purchase a parcel at a foreclosure sale. Bondownem should assume that the District will be unable to foreclose on any parcel owned by the FDIC. Such an outcome could cause a draw on the Reserve Fund and perhaps, ultimately, a default in payment on the 2003 Bonds. Based upon the secured tax roll as of January 1, 2002, the FDIC does not presently own any of the property in the District. The Authority expresses no view concerning the likelihood that the risks described above wilt materialize while the 2003 Bonds are outstanding. 57 Payment of Special Tax Not a Personal Obligation of the Property Owners An owner of Taxable Property is not personally obligated to pay the Special Tax. Rather, the Special Tax is an obligation only against the parcels of Taxable Property. If the value of the parcels of Taxable Property is not sufficient, taking into account other obligations also payable thereby to fully secure the Special Tax, the District has no recourse against the owner. Factors Affecting Parcel Values and Aggregate Value Geologic, Topographic and Climatic Conditions. The value of the Taxable ProperW in the District in the future can be adversely affected by a variety of additional factors, particularly those which may affect infrastructure and other pubhc improvements and private improvements on the parcels of Taxable Property and the continued habitabihty and enjoyment of such private improvements. Such additional factors include without limitation, geologic conditions such as earthquakes and volcanic eruptions, topographic conditions such as earth movements, landslides, liquefaction, floods or fires, and climatic conditions such as tornadoes, droughts, and the possible reduction]n water allocation or availability. It can be expected that one or more of such conditions may occur and may result in damage to improvements of varying seriousness, that the damage may entail significant repair or replacement costs and that repair or replacement may never occur either because of the cost or because repair or replacement will not facilitate habitability or other use, or because other considerations preclude such repair or replacement. Under any of these circumstances, the value of the parcels of Taxable Property may well depreciate or disappear. Seismic Conditions. The District like all California communities may be subject to unpredictable seismic activity. The occurrence of seismic activity in the District could result in substantial damage to properties in the District which, in turn, could substantially reduce the value of such properties and could affect the ability or willingness of the property owners to pay their Special Taxes. Any major damage to structures as a result of seismic activity could result in greater reliance on undeveloped property in the payment of Special Taxes. Legal Requirements. Other events which may affect the value of a parcel of Taxable Property in the District include changes in the law or application of the law. Such changes may include, without limitation, local growth control initiatives, local utility connection moratoriums and Focal application ofstatewide tax and governmental spending limitation measures. No Acceleration Provisions The 2003 Bonds do not contain a provision allowing for the acceleration of the 2003 Bonds in the event ora payment default or other default under the terms of~e 2003 Bonds or the Fiscal Agent Agreement. Pursuant to the Fiscal Agent Agreement, a Bondowner is given the right for the equal benefit and protection of all Bondowners similarly situated to pursue certain remedies (see APPENDIX E - "Summary of Certain Provisions of the Fiscal Agent Agreement" herein). So long as the 2003 Bonds are in book-entry form DTC w be the so e Bondowner and w 11 be entitled to exercise all rights and remedies of Bondownem. Community Facilities District Formation California voters, on June 6, 1978, approved an amendment ("Article XIIIA") to the California Constitution. Section 4 of Article XIIIA, requi?es a vote of two-thirds of the qualified electorate to impose "special taxes," or any additional ad valorem, sales or transaction taxes on real property. At an election held pursuant to the Act, more than two-thirds of the qualified electors within the District, consisting of the landowners within the boundaries of the District, authorized the District to incur bonded indebtedness to finance the development of the property within the District and approved the Rate and Method of Apportionment. The Supreme Court of the State has not yet decided whether landowner elections (as opposed to resident elections) satisfy requirements of Section 4 of Article XIIIA, nor has the Supreme Court decided whether the special taxes of a District constitute a "special tax" for purposes of Article XIIIA. Section 53341 of the Act requires that any action or proceeding to attack, review, set aside, void or annul the levy of a special tax or an increase in a special tax pursuant to the Act shall be commenced within 30 days after the special tax is approved by the voters. No such action has been filed with respect to the Special Tax. 58 Billing of Special Taxes A special tax formula can result in a substantially heavierpropetty tax burden being imposed upon properties within a District than elsewhere in a city or county, andthls in turn can lead to problems in the collection of the special tax. In some Districts the taxpayers have refused to pay the special tax and have commenced litigation challenging the special tax, the District and thc bonds issued by the District. Under provisions of the Act, the Special Taxes are billed to the properties within the District which were entered on the Assessment Roll of the County Assessor by January 1 of the previous fiscal year on the regular property tax bills sent to owners of such properties. Such Special Tax installments are due and payable, and bear the same penalties and interest for non-payment, as do regular property tax installments. These Special Tax installment payments cannot be made separately from property tax payments. Therefore, the unwillingness or inability ora property owner to l)ay regular property tax bill s as evidenced by property tax delinquencies may also indicate an unwillingness or,!onabilityto make regular property tax payments and installment paymen, t,s of Special Taxes in the future. See SECURITY FOR THE 2003BONDS - Proceeds of Foreclosure Sales, for a discussion of the provisions which apply, and procedures which the District is obligated to follow, in the event of delinquency in the payment of installments of Special Taxes. Collection of Special Tax In order to pay debt service on the 2003 Bonds, it is necessary that the Special Tax levied against land within the District be paid in a timely manner. The District has covenanted in the Fiscal Agent 3.greement under certain conditions to institute foreclosure proceedings against property with delinquent Special Tax in order to obtain funds to pay debt service on the 2003 Boncls. if foreclosure proceedings were instituted, any mortgage or deed of trust holder could, but would not be required to advance the amount of the delinquent SpeclalTax to protect its security interest. In the event such superior court foreclosure is necessary, there could be a delay in principal and interestpayments to the Bondowners pending prosecution of the foreclosure proceedings and receipt of the proceeds of the foreclosure sale, if any. No assurances can be given that the real property subject to foreclosure and sale at ajudicial foreclosure sale will be sold or, if sold, that the proceeds of such sale will be sufficient to pay any delinquent Special Tax installment. Although the Act authorizes the Authority as the Governing Boardof the District to cause such an action to be commenced and diligently pursued to completion, the Act does not specify the obligations of the Governing Board with regard to purchasing or otherwise acq,u, iring any lot or parcel of property sold at the foreclosure sale if there is no other purchaser at such sale. See SECURITY FOR THE 2003 BONDS - Proceeds of Foreclosure Sales." Right to Vote on Taxes Act An initiative measure commonly referred to as the "Right to Vote on Taxes Act" (the "Initiative') was approved by the voters of the State at the November 5, 1996 general election. The Initiative added Article IIIC ( Article XIIIC ) and Article XlIID to the California Constitution. According to the Title and Summary" of the Initiative prepared by the California Attorney General, the Initiative limits "the authority of local governments to impose taxes and propetty-related assessments, fees and charges." The provisions of the Initiative have not yet been interpreted by ti~e courts although a number of lawsuits have been filed requesting the courts to interpret various aspects of the Initiative. Among other things, Section 3 of Article XIII states that" . .. the initiative power shall not be prohibited or otherwise limited in matters of reducing or repealing any local tax, assessment, fee or charge." The Act provides for a procedure, which includes notice being, ~rotbst and voting requirements to alte£the rate and method of apJ~ortionment of an existing special tax. However, the Act prohibits a legislative body from adopting any resolution to reduce the rate of any special tax or terminate the levy of any special tax pledged to repay any debt incurred pursuant to the Act unless such legislative body determines that the reduction or termination of the special tax would not interfere with the timely retirement of that debt. On July 1, 1997, a bill signed into law by the Governor of the State enacting Government Code Section 5854, which states that: "Section 3 of Article XIIIC of the California Constitution, as adopted at the November 5, 1996, general election shall not be construed to mean that any owner or benefic al owner of a municipal security, purchased before or after that date, assumes the risk of, or in any wa~, consents to, any action by initiative measure that constitutes an impairment of contractual rights protected by Section 10 of Article I of the United States Constitution." 59 Accordingly, although the matter is not free from doubt, it is likely that the Initiative has not conferred on the voters the power to repeal or reduce the Special Taxes if such reduction would interfere with the timely retirement of the 2003 Bonds. It may be possible, however, for voters or the District to reduce the Special Taxes in a manner which does not intertere with the timely repayment of the 2003 Bonds but which does reduce the maximum amount of Special Taxes that ma3' be levied in any year below the existing levels. Therefore, no assurance can be given with respect to the levy of Special Taxes i~0r Administrative Expenses. Furthermore, no assurance can be given with respect to the future levy of the Special Taxes in amounts greater than the amount necessary for the t~mely retirement of the 2003 Bonds. Like its antecedents, Proposition 218 is likely to undergo both judicial and legislative scrutiny before its impact on the District and its obligations can be determined. Certain provisions of Proposition 218 may be examined by the courts for their constitutionality under both State and federal constitutional law. The District is not able to predict the outcome of any such examination. The foregoing discussion of Proposition 218 should not be considered an exhaustive or authoritative treatment of the issues. The District does not expect to be in a position to control the consideration or disposition of these issues and cannot predict the timing or outcome of any j udicial or legislative activity in this regard. Interim rulings, final decisions, legislative proposals and legislative enactments may all affect the impact of Proposition 218 on the 2003 Bonds as well-as the market for the 2003 Bonds. Legislative and court caIendar delays and other factors may prolong any uncertainty regarding the effects of Proposition 218. Ballot Initiatives and Legislative Measures The Initiative was adopted pursuant to a measure qualified for the ballot pursuant to California's constitutional initiative process and the State Legislature has in thepast enacted legislation which has altered the spending limitations or established minimum funding provisions for particular activities. From time to time, other initiative measures could be adopted by California voters or legislation enacted by the State Legislature. The adoption of any such initiative or enactment of legislation might place limitations on the ability of the State, the County the City, the District or local districts to increase revenues or to increase appropriations or on the ab I ty of a property owner to complete the development of the property. Limited Secondary Market There can be no guarantee that there will be a secondary market for the 2003 Bonds or, ifa secondary market exists, that such 2003 Bonds can be sold for any particuIar price. Although the Authority, the District, Lennar Communities and KB Home Coastal have committed to provide certain statutorily-required financial and operating information, there can be no assurance that such information will be available to Bondowners on a timely basis. The failure to provide the annual financial and operating information does not give rise to monetary damages but merely an action for specific performance. Occasionally because of general market conditions, lack of currant information or because of adverse history or economic prospects connected with a particular issue secondary marketing practices in connection with aparticular 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. Loss of Tax Exemption As discussed under the caption "LEGAL MATTERS- Tax Exemption," the interest on the 2003 Bonds could become includable in gross income for federal income tax purposes retroactive to the date of issuance of the 2003 Bonds as a result of acts or omissions of the Authority in wolation of certain provisions of the Code and the covenants of the Fiscal Agent Agreement. In order to maintain the exclusion i~rom gross income for federal income tax purposes of the interest on the 2003 Bonds the Authority has covenanted in the Fiscal Agent Agreement not to take any action, or fail to take any action, if such action or failure to take such action would adversely affect the exclusion from gross income of interest on the 2003 Bonds under the Internal Revenue Code of 1986, as amended. Should such an event oftaxabili~ occur the 2003 Bonds are not subject to early redemption and will remain outstanding to maturity or until redeemed under the optional redemption or mandatory sinking fund redemption provisions of the Fiscal Agent Agreement. 60 Limitations on Remedies Remedies available to the Bondowners may bc limited by a variety of factors and may be inadequate to assure the timely payment of principal of and interest on the 2003 Bonds or to preserve the tax-exe~npt status of the 2003 Bonds. See "Payments by FDIC and other Fedaral Agencies" "No Acceleration Provision" and "Billing of Special Taxes here n. LEGAL MATTERS Legal Opinion The legal opinion of Quint & Thimmig LLP, San Francisco, California, Bond Counsel, approving the validity of the 2003 Bonds will be made available to purchasers at the time of original delivery and the form of such opinion is attached hereto as Appendix H. McFarlin & Anderson LLP, Lake Forest, California is serving as Disclosure Counsel. Quint & Thimmig LLP will also pass upon certain legal matters for the Authority and the District as Bond Counsel. Tax Exemption In the oJ~inion of Quint & Thimmig LLP, San Francisco, California, Bond Counsel, subject, however to the qualifications set forth below, under existing law, the interest on the 2003 Bonds is excluded from gross income for federal income tax purposes and such interest is not an item of tax I~reference for purposes of the federal alternative minimum tax imposed on individuals and corporations it should be noted, however, that, for purposes of computing the alternative minimum tax imposed on corporations (as defined for federal income tax purposes), such interest is taken into account in determining certain income and earnings. The opinions set forth in the preceding l~aragravh are subject to the condition that the Authority coml~ly with all requirements of the Internal Revenue Code of1986, as amended (the "Code") that must be satisfied subsequent to the issuance of the 2003 Bonds in order that such interest be, or continue to be, excluded from gross ,ncome for federal income tax purposes. The Authority has covenanted to comply with each such requirement. Failure to comply with certain of such requirements may cause the inclusion of interest on the 2003 Bonds in gross income for federal income tax purposes to be retroactive to the date of issuance of the 2003 Bonds. In the further opinion of Bond Counsel, interest on the 2003 Bonds is exempt from California personal income taxes. Bondowners should also be aware that the ownership or disposition of, or the accrual or receil~t of interest on, the 2003 Bonds may have federal or state tax consequences other than as described above. Bond Counsel expresses no opinion regarding any federal or state tax consequences arising with respect to the 2003 Bonds other than as expressly described above. The form of Bond Counsel's opinion is set forth in Appendix H. No Litigation At the time of delivery of the 2003 Bonds the Authority and the District will cert fy that there is no action, stat, proceeding, mqul'ry or investigation, at law or in equity before or by any court or regulatory agency, public board or body pending with respect to which they have been served ~vith'process or thFeatene~t against the Authority or the D~strict affecting their existence, or the titles of their respective officers, or seeking to restrain or to er~join the issuance, sale or delivery of the 2003 Bonds, the ap. plicatlon of the proceeds thereo]~ in accordance with the Fiscal Agent Agreement, or the collection or applicat,on of the Special Tax to pay the principal of and interest on the 2~)03 Bonds, or in any way contesting or affecting the validity or enforceability of the 2003 Bonds, or the Fiscal Agent Agreement or any action of the Authority or the District contemplated by either of said documents, or in any way contesting the completeness or accuracy of this Official Statement or any amendment or supplement hereto, or contesting the powers of the Autho?ity or the District or their authority with respect to the 2003 Bonds or any action of the Authority or the District contemplated by either of said documents, nor, to the knowledge of the Authority, is there any basis therefor. 61 No General Obligation of the Authority or the District The 2003 Bonds are not general obligations of the Authority or the District, but are limited obligations &the Authority for the District payable solely from proceeds of the Special Tax and proceeds of the 2003 Bonds, includingamounts in the Reserve Fund, the Special Tax Fund and the Bond Fund. Any tax levied for the payment of the 2003 Bonds shall be limited to the Special Taxes to be collected within the jurisdiction of the District. NO RATINGS The 2003 Bonds have not been rated by any securities rating agency. UNDERWRITING The 2003 Bonds are being purchased by Stone & Youngberg LLC at a purchase price of $ (which represents the aggregate principal amount of the 2003 Bonds ($ ), less an unclerwriter's discount of $ ~. ' The purchase agreement relating to the 2003 Bonds provides that the Underwriter will purchase all of the 2003 Bonds if any are purchased, the obligation to make such purchase being subject to certain terms and cond t ohs set forth in such purchase agreement. The Underwriter may offer and sell 2003 Bonds to certain dealers and others at prices lower than the offering price stated on the cover page hereof. The offering prices may be changed from time to time by the Underwriter. PROFESSIONAL FEES Fees payable to certain professionals, in connection with the 2003 Bonds including the Underwriter Quint & Thimmig LLP, as BondCounsel, McFarlin & Anderson LLP, as Disclosure Counsel, and U.S. Bank National Association, as the Fiscal Agent, are contingent upon the issuance &the 2003 Bonds. The fees of Albert W. Webb Associates, as Special Tax Consultant, and Fieldman, Rolapp & Associates as Financial Adv sor to the Authority, are n part contingent upon the issuance of the 2003 Bonds. MISCELLANEOUS References are made herein to certain documents and reports which are brief summaries thereof which summaries do not purport to be complete or definitive and reference is made to such documents and reports for full and complete statement of the contents thereof. Any statements in this Official Statement involving matters of opinion, whether or not expressly so stated, are intended as such and not as representatives of fact. This Officml Statement is not to be construed as a contract or agreement between the District or the Authority and the purchasers or owners &any of the 2003 Bonds. The execution and delivery of the Official Statement by the District has been duly authorized by the Authority on behalf of the District. TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) By: Shawn Nelson, Executive Director, Temecula Public Financing Authority, on behalf of the District 63 APPENDIX A GENERAL INFORMATION ABOUT THE CITY OF TEMECULA The following information is provided for background purposes only. The City of Temecula has no liability whatsoever with respect to the 2003 Bonds or the Fiscal Agent Agreement General Information Following a vote by the residents on November 7, 1989, the City incorporated under the general laws of the State of California on December l, 1989. The City has a Council-Manager form of government, and is represented by the five members of the City Council who are elected at-large to serve a four-year term. The Mayor is selected annually by the members of the City Council. The Temecula Community Services District (TCSD) was also established in 1989. The TCSD is responsible for providing parks and recreation services to the citizens of Temecula, as well as street lighting andslope maintenance in certain areas of the district. Other governmental entities, such as the State of California, the County and various school, water and other districts, also provide various levels of service within the City of Temecula. However, the Temecula City Council does not have a continuing oversight responsibility over these other governmental entities. Located on Interstate 15, the City of Temecula is the 9t~ largest city in the Inland Empire and the 4~' largest in Riverside County (as of January, 2002), encompassing 27.1 square miles. The City of Temecula is 85 miles southeast of Los Angeles, 55 miles north of San Diego, 61 miles southeast of Orange County, and 20 miles inland from the cities of San Juan Capistrano and Oceanside. The City's approximately 73,000 residents are offered a broad range of housing options from apartments to luxury custom homes, with the median housing price at $253,000. Population From 1990 - 2002, the City's population grew from 27,099 to 72,715, a gain of 45,616 or 168.3%. In this same period, Riverside County added 473,928, a gain of 40.5%. CITY OF TEMECULA AND COUNTY OF RIVERSIDE POPULATION FROM 1990 TO 2002 Temecula Riverside County Year Population % Change Population % Change 1990 27,099 --- 1,170,413 --- 1991 27,264 0.6% 1,223,227 4.5% 1992 31,005 13.7 1,268,844 3.7 1993 33,226 7.2 1,304,447 2.8 1994 35,771 7.7 1,331,988 2.1 1995 39,284 9.8 1,355,571 1.8 1996 41,850 6.5 1,381,781 1.9 1997 43,760 4.6 1,400,384 1.3 1998 46,564 6.4 1,441,237 2.9 1999 48,828 4.9 1,473,307 2.2 2000 53,791 10.2 1,522,855 3.4 2001' 61,531 24.6 1,583,591 4.0 2002 72,715 8.5 1,644,341 3.8 *Increase includes Vail Ranch annexation. Source: California Department of Finance. A-1 Construction Activity The following table shows a five year history of construction activity in the City. CITY OF TEMECULA BUILDING PERMITS AND VALUATIONS 1998 - 2002 1998 1999 2000 2001 2002 Valuation: Residential $128,194,701 $180,139,368 $156,787,850 $127,823,375 $100,516,115 Non-residential 87,530,400 77,471~298 5&320~736 39~602,913 43,487~229 Total $215~725,101 $257,610,666 $215,108~586 $167~426,288 $144~003,344 Residential Units: Single family 714 1,276 1,142 944 650 Multiple family 72._.~4 19~8 24~4 0 0 Total 1,438 1,474 1.386 94~4 65.~O.0 ~Durce: C~>nstructton Industry Research Board. The following table shows historical commercial and residential construction and property values. CITY OF TEMECULA COMMERCIAL AND RESIDENTIAL CONSTRUCTION AND PROPERTY VALUES 1992 - 2002 Commercial Constructionm Residential Constructionm Property Values~2~ Number Number Fiscal Year of Units Value of Units Value Commercial Residential 1992 158 $ 902 337 $ 10,605 $1,078,926 $1,542,280 1993 150 6,316 802 50,347 1,473,713 1,454,943 1994 130 10,639 1386 113,002 1,526,353 1,489,077 1995 162 29,221 968 85,410 1,466,641 1,539,257 1996 136 23,572 987 93,674 1,478,230 1,677,720 1997 202 32,863 857 85,257 1,347,000 1,856,203 1998 203 66,226 835 105,527 1,321,044 1,958,706 1999 337 159,286 1,384 180,840 1,378,364 2,067,549 2000 437 52,497 1,179 148,660 1,524,091 2,303,303 2001 265 39,511 1,606 169,687 1,935,537 2,627,716 2002 V~uesinthousands ofdollars. (~ Uity oJ lemecuta, Building and Safety Department. County Land Use Statistical Recap Report. A-2 Economic Condition Temecula's economic base is anchored by a number of firms specializing in biomedical technolol~y and supplies, high technology controllers and semi-conductors, among others. The City's retail base [~' also experiencing growth andis home to several auto dealers including Honda, Toyota and Nissan. The following tables set forth major manufacturing and non-manufacturing employers: Employer CITY OF TEMECULA MAJOR MANUFACTURING EMPLOYERS (As of December, 2002) Approximate No. of Employees Guidant International Rectifier/Hexfet Hudson Respiratory Care Inc. Channell Commercial Corp. Milgard Manufacturing Chemicon International The Scotts Company / Temecula Opto 22 Bianchi International Plant Equipment Maxxim Medical Tension Envelope Type of Business 2,600 530 425 350 300 260 220 218 215 183 113 113 Medical equipment Power semi-conductors Medical equipment Cable enclosures Custom windows Medical products Manufacturing Electric/automation controls Leather goods Telephone equipment Specialty medical products Envelope manufacturer Source: City Finance Department. CITY OF TEMECULA MAJOR NON-MANUFACTURING EMPLOYERS Employer (As of December, 2002) Approximate No. of Employees Type of Business [~m~cula Vall.e35Unified School 2,111 strict (TVUSD) Public school system Professional Hospital Supply 550 Medical equipment/supplies Costco Wholesale 404 Wholesale warehouse Albertsons 300 Supermarket City of Temecula 244 Local Government Norm Reeves Auto Group 241 Auto dealer Temecula Creek Inn 220 Hospitality JC Penneys 200 Retail Tm Green Lawncare 200 Landscape maintenance Sears 200 Retail Lowe' s 195 Retail Target 194 Retail Sales Tax Assessed Values Industrial and business parks offering clean industries and convenient office space provide growing employment opportunities. The retail community is expanding rapidly with excellent shopping venues including the regional Promenade Mall, a unique Historic Old Town area, and neighborhood strip centers. A wide selection of restaurants allows diners to choose between nationally recognized chains or intimate dining bistros. A-3 Source: City ofTemecula. Taxpayer CITY OF TEMECULA SALES TAX HISTORY Year Amount 1989-90 $632,153 1997-98 $9,186,547 1998-99 $10,652,400 1999-00 $14,009,322 2000-01 $16,321,929 2001-02 (est.) $17,670,000 CITY OF TEMECULA PRINCIPAL SECURED PROPERTY OWNERS FOR THE YEAR ENDED JUNE 30, 2002 2002 Assessed Valuation Type of Business (in thousands) Percent of Total Assessed (Valuation} International Rectifier Corporation Advanced Cardiovascular System Inc. Temecula Towne Center Associates GMS Realty Hudson Respiratory Care, Inc. Kimco Palm Plaza Limited Partnership Arden Realty Limited Partnership Knickerbocker Properties Inc. XX John W. Hoffee Il Trust Starwood Wasserman Temecula Source: Riverside County Assessor's Office. Manufacturing Manufacturing Real Estate Development Real Estate Development Manufacturing Real Estate Development Real Estate Development Real Estate Development Manufacturing Property Management A-4 CITY OF TEMECULA ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY FOR THE FISCAL YEARS ENDED JUNE 30, 1997, 1998, 1999, 2000, 2001 AND 2002 (Values in Thousands) Total Exemptions Net Total Fiscal Year Secured and Veteran Net' Assessed Exemptions Assessed Estimated Taxes Unsecured Church, etc. Value Homeowners Value Actual Value 1997 $3,203,187 $(22,276) $3,180,911 $(53,023) $3,127,888 $3,127,888 1998 $3,279,750 $(24,100) $3,255,651 $(56,665) $3,198,986 $3,198,986 1999 $3,445,913 $(24,216) $3,421,696 $(60,119) $3,361,578 $3,361,578 2000 $3,827,394 $(25,597) $3,801,797 $(61,464) $3,740,333 $3,740,333 2001 $4,563,253 $(29,666) $4,533,587 $(64,372) $4,469,215 $4,469,215 20O2 Source: Riverside County Assessor's Office. General Information IndustrialReal Estate. The City is part of the Inland Empire's industrial real estate market. In 1999, the inland region's 26.1 million square feet of gross space absorption set a record. Lee & Associates found that in August, 2002, the City had 9.0 million square feet of industrial space or 3.0% of the inland area's inventory. Temecula's industrial vacancy rate was 12.0% representing 1.1 million square feet of space. Among local cities, this ranked ninth just below Mira Loma (1.2 million square feet) and above San Bemardino (1.06 million). [Nearby, Corona had 2,469,569 square feet available; Moreno Valley-Perris had just 7,090 square feet.] [Within the Inland Empire, the City is making the transition from a small to a mid-sized market. If multi-tenant sites are included in the City's inventory, its potential industrial space rises to 9,904,065 square feet. This figure has increased 58.4% from the 6.25 million square feet that existed in 1990.] Agriculture. The climate and soil in the City are particularly favorable for growing avocado, grape, and citrus crops. There are currently several agricultural management firms in the Temecula area which manage agricultural production of thousands of acres of land owned by individual investors, partnerships and corporations. The agricultural managers apply economies of scale, by combining many small and medium sized parcels of land as if these parcels were one large' ranch. In addition, a substantial wine industry has been developed in the City and the surrounding area. As of January, 2003, there were sixteen (16) wineries which produce wine with locally grown grapes. Climate. Temecula Valley enjoys a mild Mediterranean climate with year-round temperatures averaging in the mid 70's. The weather is comparable to the Napa Valley, as evidenced by a thriving wine industry, with warm, dry days and cool evenings. Summer-time temperatures, which can average in the mid 80's or the mid 90's during the day, are often cooled by afternoon ocean breezes blowing into the valley through gaps in the Santa Ana foothills to the west. Although separated from the Pacific by the Santa Rosa range of mountains, the Rainbow Gap funnels the mild beach climate into the valley. Mild wintertime A-5 temperatures average in the mid 60's. Yearly average rainfall in Temecula is approximately 14 inches, as compiled by the Rancho California Water district. The quality of air in the Temecula Valley is consistently be~er than that of surrounding communities. Ocean breezes flow through the Rainbow Gap almost every day, sweeping away smog. In the summer, Pacific winds yield temperatures up to 10 degrees lower than in towns just a few miles away. Education. The City is served by Temecula Valley Unified School District, one of the fastest growing school districts in the State, with 4 high schools (including a continuation school), 5 middle schools (including an alternative academy), 3 charter schools, 1 home-schooling program, and 12 elementary schools. In addition, there are 9 private schools and several pre-schools. The general boundaries extend north to Jean Nicholas Road in French Valley, ~outh to the Riverside County line, east to Vail Lake, and west to the Temecula city limit. The District covers approximately 150 square miles. Approximately 21,466 students (Grades K-12) are currently enrolled in the District. The University of California, Riverside has opened an extension center in the City and Mt. San Jacinto Community College operates a campus ten miles north of the City to serve the growing population. Temecula began the 1990s with a well-educated population, and its population trends and school performance figures have allowed it to maintain that position. Transportation. Interstate 15 and its connecting arterials provide convenient links to San Diego and Riverside, Los Angeles (Interstate 10), Orange County (Highway 91 ) and San Bernardino (Interstate 215). The French Valley Airport, 4 miles north of Interstate 15 on Winchester Road, accommodates business jets and commuter airlines. Housing: Temecula is unique in that its residents are about equidistant from both San Diego and Orange County via the Interstate 15 freeway. As a result, it is receiving growth impulses from the south as well as the north, as families spill into the Inland Empire from Southern California's more congested coastal counties. Temeeula's rapid population growth represents a relatively new phenomenon in Southern California. A large number of the City's new residents have migrated north from San Diego County along the Interstate 5 freeway. Normally, a Southern California community undergoes rapid growth only when population spills from Orange or Los Angeles counties. The latest population data shows Temecula with 72,715 residents as of January, 2002, which includes the annexation of the Vail Ranch area in July, 2001. In 2~ Quarter 2002, the median price for a new home in Temeeula was approximately $274,052. The median price for an existing home in 2~ quarter, 2002 was $253,001. Houses also got bigger. According to data from [Empire Economics, LLC's Market Absorption Repor~], the average new home size in November, 2002 was 2,958 square feet, compared to 2,242 square feet in 1999 - a 31.9% increase. The California Association of Realtors identified Temeeula as one of the top three growth areas in the State - along with Sacramento and the central coastal region. From 1990-2000, the City's housing stock increased by 8,440 (up 79.2%), with all but 2,532 of the new units being single family homes. A-6 APPENDIX B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) RATE AND METHOD OF APPORTIONMENT OF SPECIAL TAX B-1 APPENDIX C SUMMARY APPRAISAL REPORT APPENDIX D SUMMARY MARKET ABSORPTION STUDY D-I APPENDIX E SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT APPENDIX F FORM OF COMMUNITY FACILITIES DISTRICT CONTINUING DISCLOSURE AGREEMENT F-1 APPENDIX F FORM OF DISTRICT CONTINUING DISCLOSURE AGREEMENT This CONTINUING DISCLOSURE AGREEMENT (the "Disclosure Agreement") is executed and entered into as of June 1, 2003 by and among U.S. Bank National Association, a national banking association organized and existing under and by virtue of the laws of the United States of America (the "Bank"), in its capacity as Dissemination Agent (the "Dissemination Agent") and in its capacity as fiscal agent (the "Fiscal Agent"), and the Temecula Public Financing Authority, a joint exercise of powers authority organized and existing under and by virtue of the Constitution and of the laws of the State of California (the "Authority"), for and on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1, (the "District"); WITNESSETH: WHEREAS, pursuant to the Fiscal Agent Agreement, dated as of June 1, 2003 (the "Fiscal Agent Agreement"), by and between the Authority, for and on behalf of the District, and the Fiscal Agent, the Authority has issued its 2003 Special Tax Bonds in the aggregate principal amount of $ (the "Bonds"); and WHEREAS, this Disclosure Agreement is being executed and delivered by the Authority and the Fiscal Agent for the benefit of the owners and beneficial owners of the Bonds and in order to assist the underwriter of the Bonds in complying with Securities and Exchange Commission Rule 15c2-12(b)(5); NOW, THEREFORE, for and in consideration of the mutual premises and covenants herein contained, the parties hereto agree as follows: Section 1. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Fiscal Agent Agreement. In addition, the following capitalized terms shall have the following meanings: "Annual Report" shall mean any Annual Report provided by the Authority pursuant to, and described in, Sections 2 and 3 of this Disclosure Agreement. "Annual Report Date" shall mean the date in each year that is eight months after the end of the Authority's fiscal year, which date, as of the date of this Disclosure Agreement, is March 1. "Disclosure Representative" shall mean the Finance Director of the City of Temecula, as Treasurer of the Authority, or his or her designee, or such other office or employee as the Authority shall designate in writing to the Fiscal Agent from time to time. "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 Authority and which has filed with the Fiscal Agent a written acceptance of such designation. "Listed Events" shall mean any of the events listed in Section 4(a) of this Disclosure Agreement. F-I "National Repository" shall mean any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. Information on the National Repositories as ora particular date is available on the Internet at www.sec.gov/consumer/nrmsir.htm. "Official Statement" shall mean the Official Statement, dated Bonds. _, 2003, relating to the "Participating Underwriter" shall mean Stone & Youngberg LLC. "Repository" shall mean each National Repository and each State Repository. "Rule" shall mean 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. "State Repository" shall mean any public or private repository or entity designated by the State of California as a state repository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Disclosure Agreement, there is no State Repository. Section 2. Provision of Annual Reports. (a) The Authority shall, or, upon furnishing the Annual Report to the Dissemination Agent, shall cause the Dissemination Agent to, provide to each Repository, to the Fiscal Agent and to the Participating Underwriter an Annual Report which is consistent with the requirements of Section 3 of the Disclosure Agreement, not later than the Annual Report Date, commencing with the report for the 2003/04 fiscal year. The Annual Report may be submitted as a single document or as separate documents comprising a package, and may include by reference other information as provided in Section 3 of this Disclosure Agreement; provided, however, that the audited financial statements of the Authority, if any, may be submitted separately from the balance of the Annual Report, and later than the date required above for the filing of the Annual Report if not available by that date. If the Authority's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 4(f). (b) Not later than fifteen (15) Business Days prior to the date specified in subsection (a) for providing the Annual Report to Repositories, the Authority shall provide the Annual Report (in a form suitable for reporting to the Repositories) to the Dissemination Agent, the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent) and the Participating Underwriter. If by such date, the Fiscal Agent has not received a copy of the Annual Report, the Fiscal Agent shall contact the Disclosure Representative and the Dissemination Agent to inquire if the Authority is in compliance with the first sentence of this subsection (b). The Authority shall provide a written certification with each Annual Report furnished to the Dissemination Agent to the effect that such Annual Report constitutes the Annual Report required to be furnished by it hereunder. The Dissemination Agent may conclusively rely upon such certification of the Authority and shall have no duty or obligation to review such Annual Report. (c) If the Fiscal Agent is unable to verify that an Annual Report has been provided to Repositories by the date required in subsection (a), the Fiscal Agent shall send a notice to the Repositories and the appropriate State Repository, if any, in substantially the form attached as Exhibit A. (d) The Dissemination Agent shall: F-2 (i) determine each year prior to the date for providing the Annual Report the name and address of each National Repository and each State Repository, if any; and (ii) file a report with the Authority, the Participating Underwriter and (if the Dissemination Agent is not the Fiscal Agent) the Fiscal Agent certifying that the Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was provided and listing all the Repositories to which it was provided. Section 3. Content of Annual Reports. The Authority's Annual Report shall contain or incorporate by reference the following: (a) The Authority's audited financial statements, if any, prepared in accordance with generally accepted accounting principles as promulgated to apply to government entities from time to time by the Governmental Accounting Standards Board. If the Authority's audited financial statements, if any, are not available by the time the Annual Report is required to be filed pursuant to Section 2(a), the Annual Report shall contain unaudited financial statements in a format similar to that used for the Authority's audited financial statements, and the audited financial statements, if any, shall be filed in the same manner as the Annual Report when they become available. If the Authority's audited financial statements, if any, or unaudited financial statements are already filed, the Annual Report may reference that such financial statements are on file with the Repositories. (b) The following information: (i) The principal amount of Bonds, and parity bonds, if any, outstanding as of September 30 next preceding the date of the Annual Report Date. (ii) The balance in the Reserve Fund, if any, and a statement of the Reserve Requirement as of the September 30 next preceding the Annual Report Date and the balance in the other funds and accounts held under the Fiscal Agent Agreement. (iii) Information regarding the amount of the annual special taxes levied in the District, the amount collected, the names of the owners of property responsible for more than 5% of the Special Tax levy and the amount of Special Tax owed, as shown on such assessment roll of the Riverside County Assessor last equalized prior to the September 30 next preceding the Annual Report Date. (iv) The total assessed value of all parcels within the District on which the Special Taxes are levied, as shown on the assessment roll of the Riverside County Assessor last equalized prior to the September 30 next preceding the Annual Report Date, and a statement of assessed value-to-lien ratios therefor for the property in the District by Rate and Method of Apportionment of Special Tax land use categories. (v) The Special Tax delinquency rate for all parcels within the District on which the Special Taxes are levied, as shown on the assessment roll of the Riverside County Assessor last equalized prior to the September 30 next F-3 preceding the Annual Report Date, the number of parcels within the District on which the Special Taxes are levied and which are delinquent in payment of Special Taxes based on parcels, as shown on the assessment roll on the Riverside County Assessor last equalized prior to the September 30 next preceding the Annual Report Date, the amount of each delinquency, the length of time delinquent and the date on which foreclosure was commenced, or similar information pertaining to delinquencies deemed appropriate by the District; provided, however, that parcels with aggregate delinquencies of $5,000 or less (excluding penalties and interest) may be grouped together and such information may be provided by category. (vi) The status of foreclosure proceedings for any parcels within the District on which the Special Taxes are levied and a summary of the results of any foreclosure sales as of the September 30 next preceding the Annual Report Date. (vii) The identity of any property owner representing more than five percent (5%) of the annual Special Tax levy who is delinquent in payment of such Special Taxes, as shown on such assessment roll of the Riverside County Assessor last equalized prior to the September 30 next preceding the Annual Report Date. (viii) A summary of (a) zoning changes, if any, approved by the City of Temecula (the "City") for property subject to the Special Tax in the District and (b) building permits issued by the City for property subject to the Special Tax in the District. (ix) A copy of any report for or concerning the Community Facilities District as of the immediately preceding October 3 t required under State Law. (c) In addition to any of the information expressly required to be provided under paragraphs (a) and (b) of this Section, the Authority shall provide such further information, if any, as may be necessary to make the required statements, in the light of the circumstances under which they are made, not misleading. 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 Authority or related public entities, which have been submitted to each of the Repositories or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Community Facilities District shall clearly identify each such other document so included by reference. Section 4. Reporting of Significant Events. (a) Pursuant to the provisions of this Section 4, the Authority shall give, or cause to be given, notice of the occurrence of any of the following events with respect to the Bonds, if material: (i) Principal and interest payment delinquencies; F-4 (ii) Non-payment related defaults; (iii) Unscheduled draws on debt service reserves reflecting financial difficulties; (iv) Unscheduled draws on credit enhancements reflecting financial difficulties; (v) Substitution of credit or liquidity providers, or their failure to perform; (vi) Adverse tax opinions or events affecting the tax-exempt status of the security; (vii) Modifications to rights of security holders; (viii) Contingent or unscheduled bond calls; (ix) Defeasances; (x) Release, substitution, or sale of property securing repayment of the securities; (xi) Rating changes; and (xii) Receipt by the Authority of notice that a credit on liquidity facility will not be renewed, replaced or extended. (b) The Fiscal Agent shall, within five (5) business days of obtaining actual knowledge of the occurrence of any of the Listed Events, contact the Disclosure Representative, inform such person of the event, and request that the Authority promptly notify the Dissemination Agent in writing whether or not to report the event pursuant to subsection (f'), provided, however, that the Dissemination Agent shall have no liability to Bond Owners for any failure to provide such notice. For purposes of this Disclosure Agreement, "actual knowledge" of the occurrence of the Listed Events described under clauses (ii), (iii), (vi), (x) and (xi) above shall mean actual knowledge by an officer at the corporate trust office of the Fiscal Agent. The Fiscal Agent shall have no responsibility for determining the materiality of any of the Listed Events. (c) Whenever the Authority obtains knowledge of the occurrence of a Listed Event, whether because of a notice from the Fiscal Agent pursuant to subsection (b) or otherwise, the Authority shall as soon as possible determine if such event would be material under applicable Federal securities law. (d) If the Authority determines that knowledge of the occurrence of a Listed Event would be material under applicable Federal securities law, the Authority shall promptly notify the Dissemination Agent in writing. Such notice shall instruct the Dissemination Agent to report the occurrence pursuant to subsection (f). The Authority shall provide the Dissemination Agent with a form of notice of such event in a format suitable for reporting to the Municipal Securities Rulemaking Board and each State Repository, if any. F-5 (e) If in response to a request under subsection (b), the Authority determines that the Listed Event would not be material under applicable Federal securities law, the Authority shall so notify the Dissemination Agent in writing and instruct the Dissemination Agent not to report the occurrence pursuant to subsection (f). (f') If the Dissemination Agent has been instructed by the Authority to report the occurrence of a Listed Event, the Dissemination Agent shall file a notice of such occurrence with the Municipal Securities Rulemaking Board and each State Repository and shall provide a copy of such notice to each Participating Underwriter described on Exhibit B attached hereto. Notwithstanding the foregoing, notice of Listed Events described in subsections (a)(viii) and (ix) need not be given under this subsection any earlier than the notice (if any) of the underlying event is given to owners of affected Bonds pursuant to the Fiscal Agent Agreement. Section 5. Termination of Reportin~ Obligation. All of the Authority's obligations under this Disclosure Agreement shall terminate upon the earliest to occur of(i) the legal defeasance of the Bonds, (ii) prior redemption of the Bonds or (iii) payment in full of all the Bonds. If such determination occurs prior to the final maturity of the Bonds, the Authority shall give notice of such termination in the same manner as for a Listed Event under Section 4(0. Section 6. Dissemination Agent. The Authority may, from time to time, appoint or engage a Dissemination Agent to assist in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The initial Dissemination Agent shall be U.S. Bank National Association The Dissemination Agent may resign by providing forty-five (45) days' written notice to the Authority and the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent). The Dissemination Agent shall have no duty to prepare the Annual Report nor shall the Dissemination Agent be responsible for filing any Annual Report not provided to it by the Authority in a timely manner and in a form suitable for filing. If at any time there is not any other designated Dissemination Agent, the Fiscal Agent shall be the Dissemination Agent. Section 7. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Authority, the Fiscal Agent and the Dissemination Agent may amend this Disclosure Agreement (and the Fiscal Agent and the Dissemination Agent shall agree to any amendment so requested by the Authority, so long as such amendment does not adversely affect the rights or obligations of the Fiscal Agent or the Dissemination Agent), and any provision of this Disclosure Agreement may be waived, provided that the following conditions are satisfied: (a) if the amendment or waiver relates to the provisions of Sections 2(a), 3 or 4(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 Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of nationally recognized bond counsel, have complied with the requirements of the Rule at the time of the primary offering of the Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver either (i) is approved by owners of a majority of the owners of the Bonds affected thereby in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of owners, or (ii) does not, in the F-6 opinion of nationally recognized bond counsel, materially impair the interests of the owners or beneficial owners of the Bonds. If the annual financial information or operating data to be provided in the Annual Report is amended pursuant to the provisions hereof, the first annual financial information containing the amended operating data or financial information shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. If an amendment is made to the undertaking specifying the accounting principles to be followed in preparing financial statements, the annual financial information for the year in which the change is made shall present a comparison between the financial statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the financial information in order to provide information to investors to enable them to evaluate the ability of the Authority to meet its obligations, including its obligation to pay debt service on the Bonds. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be sent to the Repositories in the same manner as for a Listed Event under Section 4(f). Section 8. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Authority from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement or any other means of communication, or including any other information in any Annual Report or notice of occurrence of a Listed Event, in addition to that which is required by this Disclosure Agreement. If the Authority chooses to include any information in any Annual Report or notice of occurrence of a Listed Event in addition to that which is specifically required by this Disclosure Agreement, the Authority shall have no obligation under this Disclosure Agreement to update such information or include it in any future Annual Report or notice of occurrence of a Listed Event. Section 9. Default. In the event of a failure of the Authority, the Dissemination Agent or the Fiscal Agent to comply with any provision of this Disclosure Agreement, the Fiscal Agent may (and, at the written direction of any Participating Underwriter or the owners of at least 25% aggregate principal amount of Outstanding Bonds, shall, upon receipt of indemnification reasonably satisfactory to the Fiscal Agent), or any owner or beneficial owner of the Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Authority, the Dissemination Agent or the Fiscal Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the Authority, the Dissemination Agent or the Fiscal Agent to comply with this Disclosure Agreement shall be an action to compel performance. Section 10. Duties, Immunities and Liabilities of Fiscal Agent and Dissemination Agent. Section 7.01 and Section 7.02 of the Fiscal Agent Agreement are hereby made applicable to this Disclosure Agreement as if this Disclosure Agreement were (solely for this purpose) contained in the Fiscal Agent Agreement, and the Fiscal Agent and the Dissemination Agent shall be entitled to the protections, limitations from liability and indemnities afforded to the Fiscal Agent thereunder. The Dissemination Agent and the Fiscal Agent shall have only such duties hereunder as are specifically set forth in this Disclosure Agreement. This Disclosure Agreement does not apply to any other securities issued or to be issued by the Authority. The Dissemination Agent shall have no obligation to make any disclosure concerning the Bonds, the F-7 Authority or any other matter except as expressly set out herein, provided that no provision of this Disclosure Agreement shall limit the duties or obligations of the Fiscal Agent under the Fiscal Agent Agreement. The Dissemination Agent shall have no responsibility for the preparation, review, form or content of any Annual Report or any notice of a Listed Event. The fact that the Fiscal Agent has or may have any banking, fiduciary or other relationship with the Community Facilities District or any other party, apart from the relationship created by the Fiscal Agent Agreement and this Disclosure Agreement, shall not be construed to mean that the Fiscal Agent has knowledge or notice of any event or condition relating to the Bonds or the Community Facilities District except in its respective capacities under such agreements. No provision of this Disclosure Agreement shall require or be construed to require the Dissemination Agent to interpret or pro-bide an opinion concerning any information disclosed hereunder. Information disclosed hereunder by the Dissemination Agent may contain such disclaimer language concerning the Dissemination Agent's responsibilities hereunder with respect thereto as the Dissemination Agent may deem appropriate. The Dissemination Agent may conclusively rely on the determination of the Community Facilities District as to the materiaiity of any event for purposes of Section 4 hereof. Neither the Fiscal Agent nor the Dissemination Agent make any representation as to the sufficiency of this Disclosure Agreement for purposes of the Rule. The Dissemination Agent shall be paid compensation by the Community Facilities District for its services provided hereunder in accordance with its schedule of fees, as amended from time to time, and all expenses, legal fees and advances made or incurred by the Dissemination in the performance of its duties hereunder. The Community Facilities District's obligations under this Section 10 shall survive the termination of this Disclosure Agreement. Section 11. Beneficiaries. The Participating Underwriter and the ownem and beneficial ownem from time to time of the Bonds shall be third party beneficiaries under this Disclosure Agreement. This Disclosure Agreement shall inure solely to the benefit of the Community Facilities District, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and owners and beneficial ownem from time to time of the Bonds, and shall create no rights in any other person or entity. Section 12. Notices. Any notice or communications herein required or permitted to be given to the Authority, the Fiscal Agent or the Dissemination Agent shall be writing and shall be deemed to have been sufficiently given or served for all purposes by being delivered or sent by telecopy or by being deposited, postage prepaid, in a post office letter box, to the addresses set forth below, or to such other address as may be provided to the other parties hereinafter listed in writing from time to time, namely: If to the Authority: Temecula Public Financing Authority 43200 Business Park Drive Temecula, California 92590 Attention: Director of Finance Telephone: 909/694-6430 Telecopier: 909/694-6479 If to the Community Facilities District: Community Facilities District No. 03-1 43200 Business Park Drive Temecula, Caiifomia 92590 Attention: Director of Finance Telephone: 909/694-6430 Telecopier: 909/694-6479 F-8 If to the Dissemination Agent: U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 Telephone: 213/533-8712 Telecopier: 213/533 -8729 If to the Fiscal Agent: U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 Telephone: 213/533-8712 Telecopier: 213/533-8729 If to the Participating Underwriter: Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: 415/981-1314 Attention: Municipal Research Department Section 13. Future Determination of Obligated Persons. In the event the Securities Exchange Commission amends, clarifies or supplements the Rule in such a manner that requires any landowner within the Authority to be an obligated person as defined in the Rule, nothing contained herein shall be construed to require the Authority to meet the continuing disclosure requirements of the Rule with respect to such obligated pemon and nothing in this Disclosure Agreement shall be deemed to obligate the Authority to disclose information concerning any owner of land within the Authority except as required as part of the information required to be disclosed by the Authority pursuant to Section 4 and Section 5 hereof. Section 14. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof. Section 15. State of California Law Governs. The validity, interpretation and performance of this Purchase Agreement shall be governed by the laws of the State of California. Section 16. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 17. Merger. Any person succeeding to all or substantially all of the Dissemination Agent's corporate trust business shall be the successor Dissemination Agent without the filing of any paper or any further act. F-9 IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement as of the date first above written. TEMECULA PUBLIC FINANCING AUTHORITY, FOR AND ON BEHALF OF TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) By: Authorized Officer U.S. BANK NATIONAL ASSOCIATION, as Fiscal Agent By: Authorized Officer U.S. BANK NATIONAL ASSOCIATION, as Dissemination Agent By: Authorized Officer F-10 EXHIBIT A NOTICE TO MUNICIPAL SECURITIES RULEMAKING BOARD OF FAILURE TO FILE SEMI-ANNUAL REPORT Name of Issuer: Temecula Public Financing Authority, for and on behalf of Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Name of Bond Issue: Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Date of Issuance: ., 2003 NOTICE IS HEREBY GIVEN that the Temecula Public Financing Authority (the "Authority") has not provided an Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Agreement, dated as of June 1, 2003, by and between the U.S. Bank National Association, in its capacity as Fiscal Agent, and in its capacity as Dissemination Agent, and the Authority. [The Authority anticipates that the Annual Report will be filed by _.] Dated: U.S. Bank National Association, as Fiscal Agent, on behalf of the Temecula Public Financing Authority cc: Temecula Public Financing Authority Stone & Youngberg LLC Authorized Officer F-Il EXHIBIT B PARTICIPATING UNDERWRITER Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: (415) 981-1314 Attention: Municipal Research Department F-12 APPENDIX G FORMS OF DEVELOPER CONTINUING DISCLOSURE AGREEMENTS APPENDIX G CONTINUING DISCLOSURE AGREEMENT OF LENNAR HOMES OF CALIFORNIA, INC. This CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement") is executed and entered into as of June 1, 2003, by and between U.S. Bank National Association, a national banking association organized and existing under and by virtue of the laws of the United States of America (the "Bank"), in its capacity as Fiscal Agent (the "Fiscal Agent") and in its capacity as Dissemination Agent (the "Dissemination Agent"), Lennar Homes of California, Inc., a California corporation organized and existing under and by virtue of the laws of the State of California (the "Developer"); WITNESSETH: WHEREAS, pursuant to the Fiscal Agent Agreement, dated as of June 1, 2003 (the "Fiscal Agent Agreement"), by and between the Temecula Public Financing Authority, a joint exercise of powers authority organized and existing under and by virtue of the laws of the State of California (the "Authority") for and on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") and the Fiscal Agent, the Authority has issued the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "2003 Bonds") in the aggregate principal amount of $ ; WHEREAS, the 2003 Bonds are payable from and secured by special taxes levied on certain of the property within the District; WHEREAS, LENOne, Inc., a Virginia corporation (the "Owner") is the owner of a substantial portion of the property within the District; and WHEREAS, the Owner entered into three separate sets of option agreements with Lennar Homes, Greystone Homes, and Lennox Communities for parcels in the District and the option agreements were each amended on October 9, 2002 by a First Amendment to Option Agreement ("collectively, the Option Agreements").; WHEREAS, this Disclosure Agreement is being executed and delivered by the Developer and the Bank for the benefit of the owners and beneficial owners of the 2003 Bonds and in order to assist the Participating Underwriter of the 2003 Bonds in complying with Securities and Exchange Commission Rule 15c2-12(b)(5); NOW, THEREFORE, for and in consideration of the mutual premises and covenants herein contained, the parties hereto agree as follows: Section 1. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Fiscal Agent Agreement. In addition, the following capitalized terms shall have the following meanings: "Affiliate" of another Person means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by, or under common control with, such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies of a Person, unless such power is solely the result of an official position with such Person. "Assumption Agreement" means an agreement between a Major Developer, or an Affiliate thereof, the Fiscal Agent and the Dissemination Agent containing terms substantially similar to this Disclosure Agreement, whereby such Major Developer or Affiliate agrees to provide Semi-Annual Reports and notices of significant events with respect to the portion of the Property owned by such Major Developer and its Affiliates. G-I "Bond Counsel" means an attorney or a firm of attorneys experienced in matters relating to the issuance of obligations by the states and their political subdivisions and the tax-exempt status of the interest thereon. "Development Plan" means, with respect to a Major Developer, the specific improvements such Major Developer intends to make, or cause to be made, to such Major Developer's Property in order for such Property to enable production units to be completed and sold to third parties, the time frame in which such improvements are intended to be made and the estimated costs of such improvements; the Developer's Development Plan, as of the date hereof, is described in the Official Statement under the caption "THE COMMUNITY FACILITIES DISTRICT -Property Ownership -- Lennar Corporation and its Subsidiaries Lennar Communities, Lennar Homes, Greystone Homes and US Home; LENOne." "Dissemination Agent" means the Bank, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the Developer and which has filed with the Fiscal Agent a written acceptance of such designation. "District" means Community Facilities District No. 03-1 (Crowne Hill). "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 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 and the same shall remain undismissed for a period of 60 days, or if a receiver of the business or of the property or assets of such Person is appointed by any court, or if such Pemon makes a general assignment for the benefit of such Person's creditors. "Financing Plan" means, with respect to a Major Developer, the method by which such Major Developer intends to finance its Development Plan, including specific soumes of funding for such Development Plan; the Developer's Financing Plan, as of the date hereof, is described in the Official Statement under the caption "THE COMMUNITY FACILITIES DISTRICT -Property Ownership -- Lennar Corporation and its Subsidiaries Lennar Communities, Lennar Homes, Greystone Homes and US Home; LENOne - Plan of Finance." "Financial Statements" means, with respect to a Major Developer, the full financial statements, special purpose financial statements, project operating statements or other reports reflecting the financial position of each entity, enterprise, fund, account or other person (other than a financial institution acting as a lender in the ordinary course of business) identified in such Major Developer's Financing Plan as a source of funding for such Major Developer's Development Plan; provided that, if full financial statements, special purpose financial statements, project operating statements or other reports reflecting the financial position are audited and prepared in accordance with generally accepted accounting principles as in effect from time to time, then Financial Statements shall include such audited financial statements or reports. "First Report Date" means the date in each year that is three months after the end of the Developer's fiscal year (currently November 30 of each year), which First Report Date, as of the date of this Disclosure Agreement, is January 31, of each year, commencing January 31, 2004. "First Report Period" means with respect to a Semi-Annual Report due on the First Report Date, the last six months of the Developer's fiscal year (currently November 30 of each year)just ended. "Listed Events" means any of the events listed in Section 4(a) hereof. "Major Developer" means (i) the Developer, so long as the sum of the portion of the Property owned by the Owner, the Developer and any Affiliate of the Developer is subject to 15% or more of the Special Tax levy of the District for the then current Fiscal Year of the District, and (ii) any Property Owner, including the Developer, that owns any portion of such Property for which production units are not completed and sold to third parties and that, together with Property owned by such Property Owner and together with Property G-2 owned by Affiliates of such Property Owner and by the Owner, is subject to 15% or more of the Special Tax levy of the District for the then current Fiscal Year of the District; provided, however, that the term shall not include any Property Owner that would otherwise qualify as a Major Developer if such Property Owner has assumed the obligations hereunder pumuant to Section 5. "National Repository" means any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The Nationally Recognized Municipal Securities Information Repository for purposes of the Rule are identified in the Securities and Exchange Commission website located at sec. gov/info/municipal/nrmsir, htm. "Official Statement" means the Official Statement, dated Bonds. ., 2003, relating to the 2003 "Participating Underwriter" means Stone & Youngberg LLC. "Pemon" 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 (i) the real property within the boundaries of the District that is owned, as of the date of this Disclosure Agreement, by the Owner, the Developer, or any Affiliate of the Developer, or (ii) any real property within the boundaries of the District subsequently purchased by the Developer or any Affiliate of the Developer. "Property Owner" means any Person that owns a fee interest in any Property. "Report Dates" means, collectively, the First Report Dates and the Second Report Dates. "Report Period" means, with respect to a Semi-Annual Report due on the Fimt Report Date, the last six months of the Developer's fiscal year (which fiscal year currently ends November 30 of each year) just ended, and with respect to a Semi-Annual Report due on the Second Report Date, the first six months of the Developer's then current fiscal year (which fiscal year curremly ends November 30 of each year). "Repository" means each National Repository and each State Repository. "Rule" means Rule t 5c2-12(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. "Second Report Date" means the date in each year that is nine months after the end of the Developer's fiscal year (which currently ends November 30, of each year), which Second Report Date, as of the date of this Disclosure Agreement, is July 31, of each year, commencing July 31, 2004. "Second Report Period" means with respect to a Semi-Annual Report due on the Second Report Date, the first six months of the Developer's current fiscal year (which fiscal year currently ends November 30 of each year). "Semi-Annual Report" means any Semi-Annual Report provided by the Developer pursuant to, and as described in, Sections 2 and 3 hereof. "State Repository" means any public or private repository or entity designated by the State of California as a state repository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Disclosure Agreement, there is no State Repository. Section 2. Provision of Semi-Annual Reports. (a) So long as the Developer's obligations hereunder have not been terminated pursuant to Section 6, (i) the Developer shall prepare a Semi-Annual Report not later than January 31 and July 31 of each year, and (ii) not later than February 15 and August 15 (15 days after the Report Date), the Developer shall, or, upon receipt of the Semi-Annual Report by the Dissemination Agent, the Dissemination Agent shall, provide to each Repository, the Authority, the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent), the District and the Participating Underwriter a Semi-Annual Report which is consistent with the requirements of Section 3 of this Disclosure Agreement, commencing G-3 with the first Semi-Annual Report Date to occur January 31, 2004. 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 3 hereof; provided, however, that the audited financial statements of the Developer may be submitted separately from the balance of the Semi-Annual Report that is to be provided no later than the First Report Date, and later than the date required above for the filing of such Semi- Annual Report if not available by that date. If the Developer's fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 4(b) hereof. While any Option Agreement is in effect, the Developer shall provide the information required under this Disclosure Agreement for itself, with respect to its property and the property owned by the Owner which is subject to each Option Agreement. (b) If by February 15 or August 15 (15 days after a Report Date), the Fiscal Agent has not received a copy of the Semi-Annual Report (in a form suitable for reporting to the Repositories), the Fiscal Agent shall notify the Developer and the Dissemination Agent of such failure to receive the Semi-Annual Report. The Developer shall provide a written certification with, or as part of, each Semi-Annual Report fumished to the Fiscal Agent to the effect that such Semi-Annual Report constitutes the Semi-Annual Report required to be furnished by it hereunder. The Fiscal Agent and the Dissemination Agent may conclusively rely upon such certification of the Developer and shall have no duty or obligation to review such Semi- Annual Report. (c) If the Fiscal Agent is unable to verify that a Semi-Annual Report has been provided to the Repositories by the date required in subsection (a), the Fiscal Agent shall send a notice to the Municipal Securities Rulemaking Board, the appropriate State Repository, if any, the Dissemination Agent and the Participating Underwriter in substantially the form attached as Exhibit A. (d) The Dissemination Agent shall: (i) determine prior to each Report Date the name and address of each National Repository and each State Repository, if any; (ii) provide any Semi-Annual Report received by it to each Repository, as provided herein; and (iii) with respect to each Semi-Annual Report received by it and provided by it to each Repository, file a report with the Authority, the Developer, the Fiscal Agent (if the Dissemination Agent is not the Fiscal Agent) and the Participating Underwriter certifying that the Semi-Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was provided and listing all the Repositories to which it was provided. Section 3. Content of Semi-Annual Reports. The Developer's Semi-Annual Report shall contain or incorporate by reference the following: (a) With respect only to the Semi-Annual Report that is required to be provided no later than each First Report Date, Financial Statements for each Major Developer (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof). If audited Financial Statements are required to be provided, and such audited Financial Statements are not available by the time such Semi-Annual Report is required to be filed pursuant to Section 2(a) hereof, such Semi-Annual Report shall contain unaudited Financial Statements, and the audited Financial Statements shall be filed as a supplement or amendment to the Semi- Annual Report when they become available. Such Financial Statements shall be for the most recently ended fiscal year for the entity covered thereby. Such Financial Statements need not include the Owner. A Semi- Annual Report containing a Financial Statement shall contain the following caveat about all Financial Statements delivered as a pan of such Semi-Annual Report: "The Financial Statements of the Developer included with, or referred to in, the Semi-Annual Report are for informational purposes only. In the event of a failure to pay any installment of Special Taxes, and after depletion of the Reserve Funds, the real property in the District is the sole security for the Bonds. The obligation of the Developer and its Affiliates to pay unpaid Special Tax installments does not constitute a personal indebtedness of the Developer or any member, parent, subsidiary, or person or entity controlling or controlled by the G-4 Developer (each an "Affiliate") for which the funds or assets (other than the property in the District that is delinquent) of the Developer or any Affiliate may be required, by operation of law or otherwise, to be used to pay debt service on the Bonds. It should not be inferred from the inclusion of the Financial Statements in the Semi-Annual Report of the Developer that the funds or assets of the Developer or any Affiliate (other than the property in the District) are available to cure any delinquencies in the payment of Special Taxes." (b) With respect to all Semi-Annual Reports, the following information with respect to each Major Developer (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof) for the First Report Period or Second Report Period, as applicable; provided, that, if such information is required from the Developer as to another Major Developer which is not an Affiliate of the Developer, the Developer shall only be required to provide such information that it has actual knowledge of: (i) If information regarding such Major Developer has not previously been included in a Semi-Annual Report or in the Official Statement, the Development Plan of such Major Developer or, if information regarding such Major Developer has previously been included in a Semi-Annual Report or in the Official Statement, a description of the progress made in the Development Plan of such Major Developer since the date of such information and a description of any material changes in such Development Plan and the causes or rationale for such changes. (ii) If information regarding such Major Developer has not previously been included in a Semi-Annual Report or in the Official Statement, the Financing Plan of such Major Developer or, if information regarding such Major Developer has previously been included in a Semi-Annual Report or in the Official Statement, a description of any material changes in the Financing Plan of such Major Developer and the causes or rationale for such changes. (iii) A description or update of the status of tentative and final maps recorded within the District relating to such Major Developer. (iv) The number of building permits issued with respect to any of such Major Developer's Property during the six month period ending on the last day of the applicable Report Period as well as the number of building permits issued with respect to such Major Developer's Property included in each previous Semi-Annual Report, set forth opposite such previous reporting period. (v) A description of how many acres of Property were owned by such Major Developer as of the end of the Report Period covered by such Semi-Annual Report, how many acres of such Major Developer's Property have production units completed and sold to third parties, (i) with respect to the Property planned for park/open space have been developed with a park or designated as open space on a final residential tract map and (ii) with respect to the Property planned for infrastructure use, has the infrastructure planned for such property constructed, during the applicable Report Period and how many acres of such Major Developer's Property had not reached such level of development described in clauses (i) and (ii) above. (vi) A description of any sales of portions of such Major Developer's Property during the applicable Report Period, including the identification of each buyer (other than individual home buyers) and the number of residential lots and other acres sold; provided, however, that sales of five or fewer acres may be aggregated for the purpose of such description. (vii) a statement as to whether or not such Major Developer and all of its Affiliates paid, prior to their becoming delinquent, all Special Taxes, property taxes, assessments and special taxes levied on the Property owned by such Major Developer and such Affiliates that would have been delinquent had they not been paid by the preceding December 10 or April 10, respectively, and if such Major Developer or any of such Affiliates is delinquent in the payment of such Special Taxes, property taxes, assessments or special taxes levied on the Property, a statement identifying each parcel that is so delinquent, specifying the amount of each such delinquency and describing any plans to resolve such delinquency. G-5 (viii) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any material changes in the information relating to the Developer, any Major Developer and/or the Property owned by the Developer or such Major Developer contained in the Official Statement under the caption "BONDOWNERS' RISKS - Endangered and Threatened Species" and "- Hazardous Substances." (ix) An update of the status of any previously reported Listed Event described in Section 4 hereof and information regarding Listed Events, if any, required to be reported pursuant to Section 4 hereof. (x) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any material change in the legal structure or organization of a Major Developer. (xi) The filing and service of process on such Major Developer of a lawsuit against such Major Developer seeking damages, or a judgment in a lawsuit against the Major Developer, either of which could have a significant impact on the Major Developer's ability to pay Special Taxes or to sell or develop all or any portion of the Major Developer's Property. (xii) If applicable, a statement that a Property Owner no longer meets the definition of Major Developer, which statement shall be provided in the manner required for Semi-Annual Reports by the next succeeding date on which a Semi-Annual Report would have been filed unless such fact has previously been reported under Section 3 or Section 4. (c) In addition to any of the information expressly required to be provided under paragraphs (a) and (b) of this Section, the Developer shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. Major Developers that are Affiliates of each other may, but are not required to, file a single Semi- Annual Report covering all such entities. Any or all of the items listed in this Section 3 may be included by specific reference to other documents which have been submitted to each of the Repositories or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Developer shall clearly identify each such other document so included by reference. If a Property Owner which was a Major Developer no longer meets the definition of Major Developer, no Semi-Annual Report shall be required to be filed by or with respect to such Property Owner under this Section 3; provided, however, that notice that the Property Owner does not meet the definition of Major Developer shall be provided in the manner required for Semi-Annual Reports by the next succeeding date on which a Semi-Annual Report would have been filed unless such fact has previously been reported under Section 3 or Section 4. Section 4. Reoorting of Listed Events. (a) Pursuant to the provisions of this Section 4, the Developer shall promptly give, or cause to be given notice of the occurrence of any of the following events with respect to each Major Developer (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof); provided, that, if such information is required from the Developer as to another Major Developer which is not an Affiliate of the Developer, the Developer shall only be required to provide such information that it has actual knowledge off (i) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any conveyance by such Major Developer of any of its Property to an entity that is not an Affiliate of such Major Developer, the result of which conveyance is to cause the transferee to become a Major Developer. In addition, if the transferee has assumed any obligations of Developer under this Disclosure Agreement pursuant to Section 5 hereof, a copy of the executed Assumption Agreement shall be attached to the Notice. Notwithstanding the foregoing, the Developer shall have no obligation to provide notice of the transfer of Property (i) from the Developer to an Affiliate of the Developer, and (ii) from the Owner to the Developer or any Affiliate of the Developer pursuant to the Option Agreements. (ii) Any failure of such Major Developer, or any Affiliate of such Major Developer, to pay when due general property taxes, special taxes or assessments with respect to its Property. G-6 (iii) Any denial or termination of credit, any denial or termination of, or default under, any line of credit or loan or any other loss of a source of funds expected to be used for the Project that would have a material adverse affect on such Major Developer's most recently disclosed Financing Plan or Development Plan or on the ability of such Major Developer, or any Affiliate of such Major Developer, to pay Special Taxes within the District when due. (iv) The occurrence of an Event of Bankruptcy with respect to such Major Developer, or any Affiliate of such Major Developer, that, in the reasonable judgment of such Major Developer; would have a material adverse affect on such Major Developer's most recently disclosed Financing Plan or Development Plan or on the ability of such Major Developer, or any Affiliate of such Major Developer that owns any portion of the Property, to pay Special Taxes within the District when due. (v) Any significant amendments to land use entitlement approvals for such Major Developer's Property, if such amendments, in the reasonable judgment of such Major Developer, would prevent or significantly delay the implementation of such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (vi) Any previously undisclosed governmentally-imposed preconditions to commencement or continuation of development on such Major Developer's Property, if such preconditions, in the reasonable judgment of such Major Developer, would prevent or significantly delay such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (vii) Any previously undisclosed legislative, administrative or judicial challenges to development on such Major Developer's Property, if such challenges, in the reasonable judgment of such Major Developer, would prevent or significantly delay such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (viii) Any changes, in the reasonable judgment of such Major Developer, in the alignment, design or likelihood of completion of significant public improvements affecting such Major Developer's Property, including major thoroughfares, sewers, water conveyance systems and similar facilities that, in the reasonable judgment of such Maj or Developer, would prevent or significantly delay, such Major Developer's Development Plan as described in the Official Statement or any previous Semi-Annual Report. (ix) The filing of any lawsuit against a Major Developer which, in the reasonable judgment of such Major Developer, will adversely affect the completion of the development of Property owned by such Major Developer, or litigation which if decided against the Major Developer, in the reasonable judgment of the Major Developer, would materially adversely affect the financial condition of the Major Developer. (b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall promptly notify the Dissemination Agent, the Fiscal Agent, the Participating Underwriter, and the District in writing. The Fiscal Agent shall report the occurrence pursuant to subsection (c) below. The Developer shall provide the Dissemination Agent with a form of notice of such event in a format suitable for reporting to the Municipal Securities Rulemaking Board and each State Repository, if any. (c) If the Fiscal Agent has received notice of a Listed Event, the Fiscal Agent shall file a notice of such occurrence with the Municipal Securities Rutemaking Board and each State Repository and shall provide a copy of such notice to the Participating Underwriter described on Exhibit B attached hereto, to the Dissemination Agent and to the District. Section 5. Assumption of Obligations; Assumption of Developer's Obligations by the Owner. (a) If any portion of the Properly owned by the Owner or the Developer, or any Affiliate of the Developer, is conveyed to a Person such that, upon such conveyance, such Person will be a Major Developer, all of the obligations of the Developer hereunder with respect to the Property owned by such Major Developer and its Affiliates shall be assumed by such Major Developer or by an Affiliate. In order to effect such assumption, such Major Developer or Affiliate thereof shall enter into an Assumption Agreement. A copy of the Assumption Agreement shall be provided to the Participating Underwriter described on Exhibit B attached hereto and to the Dissemination Agent, the Fiscal Agent and the District as set forth in Section 4(i) in the G-7 manner provided in 4(b) and (c). Notwithstanding the foregoing, there shall be no requirement that a transferee enter into an Assumption Agreement provided that such transferee is (i) an Affiliate of the Developer, or (ii) the Developer or any Affiliate of the Developer pursuant to the Option Agreements. (b) Notwithstanding that (i) the Developer shall default in the performance of its obligations under any Option Agreement, (ii) an Option Agreement is terminated as a result of said default and (iii) the Developer no longer owns any property within the District, all of the obligations of the Developer hereunder shall continue to be performed by the Developer until such time as such obligations shall be assumed by a Major Developer. Section6. TerminationofReportingObligation. The Developer'sobligations under this Disclosure Agreement with respect to a Major Developer (including its obligations with respect to itself as a Major Developer) shall terminate upon the earliest to occur of(a) the date on which such Major Developer is no longer a Major Developer, as defined herein, (b) the date on which the Developer's obligations with respect to such Major Developer are assumed under an Assumption Agreement entered into pursuant to Section 5 hereof, or (c) the date on which all Special Taxes levied on any Properly owned by such Major Developer and its Affiliates are paid or prepaid in full; provided, however, that upon the occurrence of any of the events described in clause (a), (b) or (c) with respect to a Major Developer, the Developer's obligations hereunder with respect to each other Major Developer, if any, not previously terminated shall remain in full force and effect. All of the Developer's obligations under this Disclosure Agreement shall terminate, except as provided in Section 11 hereof, upon the earliest to occur of(x) the date on which no Property Owner is a Major Developer, (y) the date on which (i) the Developer is no longer a Major Developer, and (ii) the Developer no longer has any obligations under this Disclosure Agreement with respect to any remaining Property as a result of such obligations having been assumed under one or more Assumption Agreements entered into pursuant to Section 5 hereof, or (z) the date on which all of the 2003 Bonds have been legally defeased, redeemed, or paid in full. Upon the occurrence of any such termination prior to the final maturity of the 2003 Bonds, the Developer shall give notice of such termination in the same manner as for a Listed Event under Section 4 hereof. Section 7. Dissemination Agent. The initial Dissemination Agent shall be U.S. Bank National Association. The Developer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign by providing thirty (30) days' written notice to the Developer, the Authority and the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent) such resignation to become effective upon acceptance of the appointment by a successor Dissemination Agent. Upon receiving notice of such resignation, the Developer shall promptly appoint a successor Dissemination Agent by an instrument in writing, delivered to the Fiscal Agent. If no appointment of a successor Dissemination Agent shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Dissemination Agent shall have given to the Developer, the Authority and the Fiscal Agent written notice of its resignation, the Dissemination Agent may apply to any court of competent jurisdiction to appoint a successor Dissemination Agent. Said court may thereupon after such notice, if any, as such court may deem proper, appoint a successor Dissemination Agent. The Developer shall provide the Authority and the Fiscal Agent with written notice of the identity of any successor Dissemination Agent appointed or engaged by the Developer. The Dissemination Agent shall have no duty to prepare the Semi-Annual Report nor shall the Dissemination Agent be responsible for filing any Semi-Annual Report not provided to it by the Developer in a timely manner and in a form suitable for filing. If the Dissemination Agent is other than the Fiscal Agent, the Developer shall be responsible for paying the fees and expenses of the Dissemination Agent for its services provided hereunder in accordance with its schedule of fees as amended from time to time. If the Dissemination Agent is the Fiscal Agent, the District shall be responsible for paying the fees and expenses of the Dissemination Agent for its services provided hereunder in accordance with its agreement with the District. Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Developer, the Fiscal Agent and the Dissemination Agent may amend this Disclosure Agreement (and the Fiscal Agent and the Dissemination Agent shall agree to any amendment so requested by the Developer, provided that the Fiscal Agent or the Dissemination Agent shall not be obligated to enter into such amendment that modifies or increases its duties and obligations hereunder), and any provision of this Disclosure Agreement may be amended or waived, provided that the following conditions are satisfied: G-8 (a) if the amendment or waiver relates to Sections 2(a), 3 or 4(a) hereof 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 (as defined in the Rule) with respect to the 2003 Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of Bond Counsel approved by the Authority, have complied with the requirements of the Rule at the time of the primary offering of the 2003 Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in circumstances; and (c) the proposed amendment or waiver either (i) is approved by owners of the 2003 Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of owners of the 2003 Bonds, or (ii) does not, in the opinion of Bond Counsel approved by the Authority, materially impair the interests of owners or beneficial owners of the 2003 Bonds. If the financial information or operating data contained within the Financial Statements to be provided in the Semi-Annual Report or amendment or supplement thereto is amended pursuant to the provisions hereof, the first Semi-Annual Report or amendment or supplement thereto containing the operating data or financial information in accordance with such amendment shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. As required by the Rule, if an amendment is made to the provisions hereof specifying the accounting principles to be followed in preparing Financial Statements, the financial information for the year in which the change is made shall present a comparison between the Financial Statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. .The comparison shall include a qualitative discussion of the differences in the accounting principles and the tmpact of the change in the accounting principles on the presentation of the Financial Statements, in order to enable investors to evaluate the ability of the Major Developer to generally meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be sent to the Repositories in the same manner as for a Listed Event under Section 4 hereof. Section 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Developer from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement 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 Agreement. If the Developer 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 Agreement, the Developer shall have no obligation under this Disclosure Agreement to update such information or include it in any future Semi-Annual Report or notice of occurrence of a Listed Event. Section 10. Default. In the event of a failure of the Developer or the Fiscal Agent to comply with any provision of this Disclosure Agreement, the Fiscal Agent may (and, at the written direction of the Participating Underwriter or the owners of at least 25% aggregate principal amount of Outstanding 2003 Bonds, and after adequate indemnification shall), or any owner or beneficial owner of the 2003 Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer, the Dissemination Agent or the Fiscal Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the Developer, the Dissemination Agent or the Fiscal Agent to comply with this Disclosure Agreement shall be an action to compel performance. Section 11. Duties, Immunities and Liabilities of Fiscal Agent and Dissemination Agent. Neither the Fiscal Agent nor the Dissemination Agent (if other than the Fiscal Agent or the Fiscal Agent in its capacity as Dissemination Agent) shall have any responsibility for the content of any Semi-Annual Report. The Dissemination Agent (if other than the Fiscal Agent or the Fiscal Agent in its capacity as Dissemination Agent) and the Fiscal Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. The Developer agrees to indemnify and save each of the Fiscal Agent and the Dissemination Agent, and their respective officers, directors, employees and agents, harmless against any loss, expense and liabilities which it or they may incur arising out of or in the exemise or performance of their powers and G-9 duties hereunder, including the reasonable costs and expenses (including attorneys fees) of defending against any claim of liability with counsel approved by the Developer, which approval shall not be unreasonably withheld, but excluding losses, expenses and liabilities due to the Fiscal Agent's or the Dissemination Agent's negligence, willful misconduct or failure to comply with any provision of this Disclosure Agreement. The obligations of the Developer under this Section shall survive resignation or removal of such Dissemination Agent and payment of the 2003 Bonds and the resignation or removal of the Trustee. Any action for which indemnification is sought from the Developer shall be deemed an action on a contract (this Agreement) for which the provisions of Section 18 are applicable. All of the protections from liability applicable to the Fiscal Agent shall apply to the Dissemination Agent. The Dissemination Agent and Fiscal Agent shall have no responsibility for the preparation, review, form or content of any Semi-Annual Report or any notice of a Listed Event. No provision of this Disclosure Agreement shall require or be construed to require the Dissemination Agent or Fiscal Agent to interpret or provide an opinion concerning any information disclosed hereunder. Information disclosed hereunder by the Dissemination Agent may contain such disclaimer language concerning the Dissemination Agent's responsibilities hereunder with respect thereto as the Dissemination Agent may deem appropriate. The Dissemination Agent and Fiscal Agent may conclusively rely on the determination of the Developer as to the materiality of any event for purposes of Section 4 hereof. Neither the Fiscal Agent nor the Dissemination Agent make any representation as to the sufficiency of this Disclosure Agreement for purposes of the Rule. The Developer's obligations under this Section shall survive the termination of this Disclosure Agreement. Section 12. Notices. Any notice or communications to or among any of the parties to this Disclosure Agreement shall be given to all of the following and may be given as follows: If to the Developer: Lennar Homes of California c/o Lennar Communities 24800 Chrisanta Drive Mission Viejo, California 92691 Telephone: (949) 598-8640 Telecopier: (949) 598-864 l Attention: Mr. [Graham Jones], Chief Financial Officer lfto the Community Temecula Public Financing Authority Facilities District: Community Facilities District No. 03-1 (Crowne Hill) 43200 Business Park Drive Temecula, California 92590 Attention: Finance Director Telephone: 909/694-6440 Telecopier: 909694-6499 If to the Dissemination If to the Fiscal Agent: If to the Participating Underwriter: U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 Telephone: 213/533-8712 Telecopier: 213/533-8729 U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 Telephone: 213/533-8712 Telecopier: 213/533-8729 Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: 415/445-2300 Telecopier: 415/445-2395 Attention: Municipal Research Department Section 13. Beneficiaries. The Participating Underwriter and the owners and beneficial owners from time to time of the 2003 Bonds shall be third party beneficiaries under this Disclosure Agreement. This G-10 Disclosure Agreement shall inure solely to the benefit of the Developer, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and owners and beneficial owners from time to time of the 2003 Bonds, and shall create no rights in any other person or entity. Any action by a beneficiary of this Agreement shall be subject to Section 18 below. Section 14. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 15. Merger. Any person succeeding to all or substantially all of the Dissemination Agent's corporate trust business shall be the successor Dissemination Agent without the filing of any paper or any further act. Section 16. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof. Section 17. State of California Law Governs. The validity, interpretation and performance of this Disclosure Agreement shall be governed by the laws of the State of California. Section 18. Attorneys' Fees. In the event of the bringing of any action or suit by any Party against another Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the other Party all costs and expenses of suit, including reasonable attorneys' fees. G-Il IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreement as of the date first above written. LENNAR HOMES OF CALIFORNIA, INC., a California corporation By: lts: U.S. BANK NATIONALASSOCIAT1ON, as FiscalAgent By: Authorized Officer U.S. BANK NATIONAL ASSOCIATION, as Dissemination Agent By: Authorized Officer G-12 EXHIBIT A NOTICE TO MUNICIPAL SECURITIES RULEMAKING BOARD OF FAILURE TO FILE SEMI-ANNUAL REPORT Name of Obligated Person: Name of Bond Issue: Date of Issuance: Lennar Homes of California, Inc., a California corporation Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds ,2003 NOTICE IS HEREBY GIVEN that Lennar Homes of California, Inc. (the "Developer") has not provided a Semi-Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Agreement, dated as of June 1, 2003, by and between the Developer and U.S. Bank National Association, as Fiscal Agent and Dissemination Agent. [The Developer anticipates that the Semi-Annual Report will be filed by .] Dated: ,20__ U.S. BANK NATIONAL ASSOCIATION, as Dissemination Agent, on behalf of Lennar Homes of California, Inc. Temecula Public Financing Authority c/o City of Temecula Stone & Youngberg LLC G-13 EXHIBIT B PARTICIPATING UNDERWRITER Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: 415/445-2300 Telecopier: 415/445-2395 Armntion: Municipal Research Department. G-14 CONTINUING DISCLOSURE AGREEMENT OF KB HOME COASTAL, INC. This CONTINUING DISCLOSURE AGREEMENT (this "Disclosure Agreement") is executed and entered into as of June 1, 2003, by and between U.S. Bank National Association, a national banking association organized and existing under and by virtue of the laws of the United States of America (the "Bank"), in its capacity as Fiscal Agent (the "Fiscal Agent") and in its capacity as Dissemination Agent (the "Dissemination Agent"), and KB Home Coastal, Inc., a California corporation organized and existing under and by virtue of the laws of the State of California (the "Developer"); WITNESSETH: WHEREAS, pursuant to the Fiscal Agent Agreement, dated as of June 1, 2003 (the "Fiscal Agent Agreement"), by and between the Temecula Public Financing Authority, a joint exercise of powers authority organized and existing under and by virtue of the laws of the State of California (the "Authority") for and on behalf of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") and the Fiscal Agent, the Authority has issued the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "2003 Bonds") in the aggregate principal amount of $ ; WHEREAS, the 2003 Bonds are payable from and secured by special taxes levied on certain of the property within the District; and WHEREAS, the Developer is the owner of a substantial portion of the property within the District; WHEREAS, this Disclosure Agreement is being executed and delivered by the Developer and the Bank for the benefit of the owners and beneficial owners of the 2003 Bonds and in order to assist the Participating Underwriter of the 2003 Bonds in complying with Securities and Exchange Commission Rule 15c2 12(b)(5); NOW, THEREFORE, for and in consideration of the mutual premises and covenants herein contained, the parties hereto agree as follows: Section 1. Definitions. Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Fiscal Agent Agreement. In addition, the following capitalized terms shall have the following meanings: "Affiliate" of another Person means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by, or under common control with, such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies of a Person, unless such power is solely the result of an official position with such Person. "Assumption Agreement" means an agreement between a Major Developer, or an Affiliate thereof, the Fiscal Agent and the Dissemination Agent containing terms substantially similar to this Disclosure Agreement, whereby such Major Developer or Affiliate agrees to provide Semi-Annual Reports and notices of significant events with respect to the portion of the Property owned by such Major Developer and its Affiliates. "Bond Counsel" means an attorney or a firm of attorneys experienced in matters relating to the issuance of obligations by the states and their political subdivisions and the tax-exempt status of the interest thereon. "Development Plan" means, with respect to a Major Developer, the specific improvements such Major Developer intends to make, or cause to be made, to such Major Developer's Property in order for such G-15 Property to enable production units to be completed and sold to third parties, the time frame in which such improvements are intended to be made and the estimated costs of such improvements; the Developer's Development Plan, as of the date hereof, is described in the Official Statement under the caption "THE COMMUNITY FACILITIES DISTRICT -Property Ownership -- KB Home Coastal. "Dissemination Agent" means the Bank, acting in its capacity as Dissemination Agent hereunder, or any successor Dissemination Agent designated in writing by the Developer and which has filed with the Fiscal Agent a written acceptance of such designation. "District" means Community Facilities District No. 03-1 (Crowne Hill). "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 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 and the same shall remain undismissed for a period of 60 days, 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. "Financing Plan" means, with respect to a Major Developer, the method by which such Major Developer intends to finance its Development Plan, including specific sources of funding for such Development Plan; the Developer's Financing Plan, as of the date hereof, is described in the Official Statement under the caption "THE COMMUNITY FACILITIES DISTRICT -Property Ownership -- KB Home Coastal - Plan of Finance." "Financial Statements" means, with respect to a Major Developer, the full financial statements, special purpose financial statements, project operating statements or other reports reflecting the financial position of each entity, enterprise, fund, account or other person (other than a financial institution acting as a lender in the ordinary course of business) identified in such Major Developer's Financing Plan as a soume of funding for such Major Developer's Development Plan; provided that, if full financial statements, special purpose financial statements, project operating statements or other reports reflecting the financial position are audited and prepared in accordance with generally accepted accounting principles as in effect from time to time, then Financial Statements shall include such audited financial statements or reports. "First Report Date" means the date in each year that is three months after the end of the Developer's fiscal year (currently November 30 of each year), which First Report Date, as of the date of this Disclosure Agreement, is January 31 of each year, commencing January 31, 2004. "First Report Period" means with respect to a Semi-Annual Report due on the First Report Date, the last six months of the Developer's fiscal year (currently November 30 of each year)just ended. "Listed Events" means any of the events listed in Section 4(a) hereof. "Major Developer" means (i) the Developer, so long as the sum of the portion of the Property owned by the Developer and any Affiliate of the Developer is subject to 15% or more of the Special Tax levy of the District for the then current Fiscal Year of the District, and (ii) any Property Owner, including the Developer, that owns any portion of such Property for which production units are not completed and sold to third parties and that, together with Property owned by such Property Owner and together with Property owned by Affiliates of such Property Owner, is subject to 15% or more of the Special Tax levy of the District for the then current Fiscal Year of the District; provided, however, that the term shall not include any Property Owner that would otherwise qualify as a Major Developer if such Property Owner has assumed the obligations hereunder pursuant to Section 5. "National Repository" means any Nationally Recognized Municipal Securities Information Repository for purposes of the Rule. The Nationally Recognized Municipal Securities Information G-16 Repository for purposes of the Rule are identified in the Securities and Exchange Commission website located at sec.gov/info/municipal/nrmsir, htm. "Official Statement" means the Official Statement, dated Bonds. _, 2003, relating to the 2003 "Participating Underwriter" means Stone & Youngberg LLC. "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 (i) the real property within the boundaries of the District that is owned, as of the date of this Disclosure Agreement, by the Developer, or any Affiliate of the Developer, or (ii) any real property within the boundaries of the District subsequently purchased by the Developer or any Affiliate of the Developer. "Property Owner" means any Person that owns a fee interest in any Property. "Report Dates" means, collectively, the First Report Dates and the Second Report Dates. "Report Period" means, with respect to a Semi-Annual Report due on the First Report Date, the last six months of the Developer's fiscal year (which fiscal year currently ends November 30 of each year) just ended, and with respect to a Semi-Annual Report due on the Second Report Date, the first six months of the Developer's then current fiscal year (which fiscal year currently ends November 30 of each year). "Repository" means each National Repository and each State Repository. "Rule" means Rule 15c2- ! 2(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. "Second Report Date" means the date in each year that is nine months after the end of the Developer's fiscal year (which currently ends November 30, of each year), which Second Report Date, as of the date of this Disclosure Agreement, is July 31 of each year, commencing July 31, 2004. "Second Report Period" means with respect to a Semi-Annual Report due on the Second Report Date, the first six months of the Developer's current fiscal year (which fiscal year currently ends November 30 of each year). "Semi-Annual Report" means any Semi-Annual Report provided by the Developer pursuant to, and as described in, Sections 2 and 3 hereof. "State Repository" means any public or private repository or entity designated by the State of California as a state repository for the purpose of the Rule and recognized as such by the Securities and Exchange Commission. As of the date of this Disclosure Agreement, there is no State Repository. Section 2. Provision of Semi-Annual Reports. (a) So long as the Developer's obligations hereunder have not been terminated pursuant to Section 6, (i) the Developer shall prepare a Semi-Annual Report not later than January 31, and July 31 of each year, and (ii) not later than February 15 and August 15 (15 days after the Report Date), the Developer shall, or, upon receipt of the Semi-Annual Report by the Dissemination Agent, the Dissemination Agent shall, provide to each Repository, the Authority, the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent), the District and the Participating Underwriter a Semi-Annual Report which is consistent with the requirements of Section 3 of this Disclosure Agreement, commencing with the first Semi-Annual Report Date to occur January 31, 2004. 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 3 hereof; provided, however, that the audited financial statements of the Developer may be submitted separately from the balance of the Semi-Annual Report that is to be provided no later than the First Report Date, and later than the date required above for the filing of such Semi- Annual Report if not available by that date. If the Developer' s fiscal year changes, it shall give notice of such change in the same manner as for a Listed Event under Section 4(b) hereof. G-17 (b) If by February 15 or August 15 (15 days after a Report Date), the Fiscal Agent has not received a copy of the Semi-Annual Report (in a form suitable for reporting to the Repositories), the Fiscal Agent shall notify the Developer and the Dissemination Agent of such failure to receive the Semi-Annual Report. The Developer shall provide a written certification with, or as part of, each Semi-Annual Report furnished to the Fiscal Agent to the effect that such Semi-Annual Report constitutes the Semi-Annual Report required to be furnished by it hereunder. The Fiscal Agent and the Dissemination Agent may conclusively rely upon such certification of the Developer and shall have no duty or obligation to review such Semi- Annual Report. (c) If the Fiscal Agent is unable to verify that a Semi-Annual Report has been provided to the Repositories by the date required in subsection (a), the Fiscal Agent shall send a notice to the Mtmicipal Securities Rulemaking Board, the appropriate State Repository, if any, the Dissemination Agent and the Participating Underwriter in substantially the form attached as Exhibit A. (d) The Dissemination Agent shall: (i) determine prior to each Report Date the name and address of each National Repository and each State Repository, if any; (ii) herein; and provide any Semi-Annual Report received by it to each Repository, as provided (iii) with respect to each Semi-Annual Report received by it and provided by it to each Repository, file a report with the Authority, the Developer, the Fiscal Agent (if the Dissemination Agent is not the Fiscal Agent) and the Participating Underwriter certifying that the Semi-Annual Report has been provided pursuant to this Disclosure Agreement, stating the date it was provided and listing all the Repositories to which it was provided. Section 3. Content of Semi-Annual Reports. The Developer's Semi-Annual Report shall contain or incorporate by reference the following: (a) With respect only to the Semi-Annual Report that is required to be provided no later than each First Report Date, Financial Statements for each Major Dex;eloper (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof). If audited Financial Statements are required to be provided, and such audited Financial Statements are not available by the time such Semi-Annual Report is required to be filed pursuant to Section 2(a) hereof, such Semi-Annual Report shall contain unaudited Financial Statements, and the audited Financial Statements shall be filed as a supplement or amendment to the Semi- Annual Report when they become available. Such Financial Statements shall be for the most recently ended fiscal year for the entity covered thereby. (b) With respect to all Semi-Annual Reports, the following information with respect to each Major Developer (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof) for the First Report Period or Second Report Period, as applicable; provided, that, if such information is required from the Developer as to another Major Developer which is not an Affiliate of the Developer, the Developer shall only be required to provide such information that it has actual knowledge off (i) If information regarding such Major Developer has not previously been included in a Semi-Annual Report or in the Official Statement, the Development Plan of such Major Developer or, if information regarding such Major Developer has previously been included in a Semi-Annual Report or in the Official Statement, a description of the progress made in the Development Plan of such Major Developer since the date of such information and a description of any material changes in such Development Plan and the causes or rationale for such changes. (ii) If information regarding such Major Developer has not previously been included in a Semi-Annual Report or in the Official Statement, the Financing Plan of such Major Developer or, if information regarding such Major Developer has previously been included in a Semi-Annual Report or in the Official Statement, a description of any material changes in the Financing Plan of such Major Developer and the causes or rationale for such changes. G-18 (iii) A description or update of the status of tentative and final maps recorded within the District relating to such Major Developer. (iv) The number of building permits issued with respect to any of such Major Developer's Property during the six month period ending on the last day of the applicable Report Period as well as the number of building permits issued with respect to such Major Developer's Property included in each previous Semi-Annual Report, set forth opposite such previous reporting period. (v) A description of how many acres of Property were owned by such Major Developer as of the end of the Report Period covered by such Semi-Annual Report, how many acres of such Major Developer's Property have production units completed and sold to third parties, (i) with respect to the Property planned for park/open space have been developed with a park or designated as open space on a final residential tract map and (ii) with respect to the Property planned for infrastructure use, has the infrastructure planned for such property constructed, during the applicable Report Period and how many acres of such Major Developer's Property had not reached such level of development described in clauses (i) and (ii) above. (vi) A description of any sales of portions of such Major Developer's Property during the applicable Report Period, including the identification of each buyer (other than individual home buyers) and the number of residential lots and other acres sold; provided, however, that sales of five or fewer acres may be aggregated for the purpose of such description. (vii) a statement as to whether or not such Major Developer and all of its Affiliates paid, prior to their becoming delinquent, all Special Taxes, property taxes, assessments and special taxes levied on the Property owned by such Major Developer and such Affiliates that would have been delinquent had they not been paid by the preceding December 10 or April 10, respectively, and if such Major Developer or any of such Affiliates is delinquent in the payment of such Special Taxes, property taxes, assessments or special taxes levied on the Property, a statement identifying each parcel that is so delinquent, specifying the amount of each such delinquency and describing any plans to resolve such delinquency. (viii) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any material changes in the information relating to the Developer, any Major Developer and/or the Property owned by the Developer or such Major Developer contained in the Official Statement under the caption "BONDOWNERS' RISKS - Endangered and Threatened Species" and "- Hazardous Substances." (ix) An update of the status of any previously reported Listed Event described in Section 4 hereof and information regarding Listed Events, if any, required to be reported pursuant to Section 4 hereof. (x) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any material change in the legal structure or organization ora Major Developer. (xi) The filing and service of process on such Major Developer ora lawsuit against such Major Developer seeking damages, or a judgment in a lawsuit against the Major Developer, either of which could have a significant impact on the Major Developer's ability to pay Special Taxes or to sell or develop all or any portion of the Major Developer's Property. (xii) If applicable, a statement that a Property Owner no longer meets the definition of Major Developer, which statement shall be provided in the manner required for Semi-Annual Reports by the next succeeding date on which a Semi-Annual Report would have been filed unless such fact has previously been reported under Section 3 or Section 4. (c) In addition to any of the information expressly required to be provided under paragraphs (a) and (b) of this Section, the Developer shall provide such further information, if any, as may be necessary to make the specifically required statements, in the light of the circumstances under which they are made, not misleading. G-19 Major Developers that are Affiliates of each other may, but are not required to, file a single Semi- Annual Report covering all such entities. Any or all of the items listed in this Section 3 may be included by specific reference to other documents which have been submitted to each of the Repositories or the Securities and Exchange Commission. If the document included by reference is a final official statement, it must be available from the Municipal Securities Rulemaking Board. The Developer shall clearly identify each such other document so included by reference. If a Property Owner which was a Major Developer no longer meets the definition of Major Developer, no Semi-Annual Report shall be required to be filed by or with respect to such Property Owner under this Section 3; provided, however, that notice that the Property Owner does not meet the definition of Major Developer shall be provided in the manner required for Semi-Annual Reports by the next succeeding date on which a Semi-Annual Report would have been filed unless such fact has previously been reported under Section 3 or Section 4. Section 4. Renortine of Listed Events. (a) Pursuant to the provisions of this Section 4, the Developer shall promptly give, or cause to be given notice of the occurrence of any of the following events with respect to each Major Developer (other than any Major Developer with respect to which the Developer's obligations hereunder have been assumed in accordance with Section 5 or terminated in accordance with Section 6 hereof); provided, that, if such information is required from the Developer as to another Major Developer which is not an Affiliate of the Developer, the Developer shall only be required to provide such information that it has actual knowledge of: (i) Unless disclosed in the Official Statement or a prior Semi-Annual Report, any conveyance by such Major Developer of any of its Property to an entity that is not an Affiliate of such Major Developer, the result of which conveyance is to cause the transferee to become a Major Developer. In addition, if the transferee has assumed any obligations of Developer under this Disclosure Agreement pursuant to Section 5 hereof, a copy of the executed Assumption Agreement shall be attached to the Notice. (ii) Any failure of such Major Developer, or any Affiliate of such Major Developer, to pay when due general property taxes, special taxes or assessments with respect to its Property. (iii) Any denial or termination of credit, any denial or termination of, or default under, any line of credit or loan or any other loss of a source of funds expected to be used for the Project that would have a material adverse affect on such Major Developer's most recently disclosed Financing Plan or Development Plan or on the ability of such Major Developer, or any Affiliate of such Major Developer, to pay Special Taxes within the District when due. (iv) The occurrence of an Event of Bankruptcy with respect to such Major Developer, or any Affiliate of such Major Developer, that, in the reasonable judgment of such Major Developer; would have a material adverse affect on such Major Developer's most recently disclosed Financing Plan or Development Plan or on the ability of such Major Developer, or any Affiliate of such Major Developer that owns any portion of the Property, to pay Special Taxes within the District when due. (v) Any significant amendments to land use entitlement approvals for such Major Developer's Property, if such amendments, in the reasonable judgment of such Maj or Developer, would prevent or significantly delay the implementation of such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (vi) Any previously undisclosed governmentally-imposed preconditions to commencement or continuation of development on such Major Developer's Property, if such preconditions, in the reasonable judgment of such Major Developer, would prevent or significantly delay such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (vii) Any previously undisclosed legislative, administrative or judicial challenges to development on such Major Developer's Property, if such challenges, in the reasonable judgment of such Major Developer, would prevent or significantly delay such Major Developer's Development Plan as described in the Official Statement or in any previous Semi-Annual Report. (viii) Any changes, in the reasonablej udgrnent of such Major Developer, in the aligmnent, design or likelihood of completion of significant public improvements affecting such Major G-20 Developer's Property, including major thoroughfares, sewers, water conveyance systems and similar facilities that, in the reasonable judgment of such Major Developer, would prevent or significantly delay such Major Developer's Development Plan as described in the Official Statement or any previous Semi-Annual Report. (ix) The filing of any lawsuit against a Major Developer which, in the reasonable judgment of such Major Developer, will adversely affect the completion of the development of Property owned by such Major Developer, or litigation which if decided against the Major Developer, in the reasonable judgment of the Major Developer, would materially adversely affect the financial condition of the Major Developer. (b) Whenever the Developer obtains knowledge of the occurrence of a Listed Event, the Developer shall promptly notify the Dissemination Agent, the Fiscal Agent, the Participating Underwriter, and the District in writing. The Fiscal Agent shall report the occurrence pursuant to subsection (c) below. The Developer shall provide the Dissemination Agent with a form of notice of such event in a format suitable for reporting to the Municipal Securities Rulemaking Board and each State Repository, if any. (c) If the Fiscal Agent has received notice of a Listed Event, the Fiscal Agent shall file a notice of such occurrence with the Municipal Securities Rulemaking Board and each State Repository and shall provide a copy of such notice to the Participating Underwriter described on Exhibit B attached hereto, to the Dissemination Agent and to the District. Section 5. Assumption of Obligations. If any portion of the Property owned by the Developer, or any Affiliate of the Developer, is conveyed to a Person such that, upon such conveyance, such Person will be a Major Developer, all of the obligations of the Developer hereunder with respect to the Property owned by such Major Developer and its Affiliates shall be assumed by such Major Developer or by an Affiliate. In order to effect such assumption, such Major Developer or Affiliate thereof shall enter into an Assumption Agreement. A copy of the Assumption Agreement shall be provided to the Participating Underwriter described on Exhibit B attached hereto and to the Dissemination Agent, the Fiscal Agent and the District as set forth in Section 40) in the manner provided in 4(b) and (c). Section 6. Termination of Reporting Obligation. The Developer's obligations under this Disclosure Agreement with respect to a Major Developer (including its obligations with respect to itself as a Major Developer) shall terminate upon the earliest to occur of(a) the date on which such Major Developer is no longer a Major Developer, as defined herein, (b) the date on which the Developer's obligations with respect to such Major Developer are assumed under an Assumption Agreement entered into pursuant to Section 5 hereof, or (c) the date on which all Special Taxes levied on any Property owned by such Major Developer and its Affiliates are paid or prepaid in full; provided, however, that upon the occurrence of any of the events described in clause (a), (b) or (c) with respect to a Major Developer, the Developer's obligations hereunder with respect to each other Major Developer, if any, not previously terminated shall remain in full force and effect. All of the Developer's obligations under this Disclosure Agreement shall terminate, except as provided in Section 11 hereof, upon the earliest to occur of (x) the date on which no Property Owner is a Major Developer, (y) the date on which (i) the Developer is no longer a Major Developer, and (ii) the Developer no longer has any obligations under this Disclosure Agreement with respect to any remaining Property as a result of such obligations having been assumed under one or more Assumption Agreements entered into pursuant to Section 5 hereof, or (z) the date on which all of the 2003 Bonds have been legally defeased, redeemed, or paid in full. Upon the occurrence of any such termination prior to the final maturity of the 2003 Bonds, the Developer shall give notice of such termination in the same manner as for a Listed Event under Section 4 hereof. Section 7. Dissemination Agent. The initial Dissemination Agent shall be U.S. Bank National Association. The Developer may, from time to time, appoint or engage a Dissemination Agent to assist it in carrying out its obligations under this Disclosure Agreement, and may discharge any such Dissemination Agent, with or without appointing a successor Dissemination Agent. The Dissemination Agent may resign by providing thirty (30) days' written notice to the Developer, the Authority and the Fiscal Agent (if the Fiscal Agent is not the Dissemination Agent) such resignation to become effective upon acceptance of the appointment by a successor Dissemination Agent. Upon receiving notice of such resignation, the Developer shall promptly appoint a successor Dissemination Agent by an instrument in writing, delivered to the Fiscal Agent. If no appointment of a successor Dissemination Agent shall be made pursuant to the foregoing provisions of this Section within forty-five (45) days after the Dissemination Agem shall have given to the G-21 Developer, the Authority and the Fiscal Agent written notice of its resignation, the Dissemination Agent may apply to any court of competent jurisdiction to appoint a successor Dissemination Agent. Said court may thereupon after such notice, if any, as such court may deem proper, appoint a successor Dissemination Agent. The Developer shall provide the Authority and the Fiscal Agent with written notice of the identity of any successor Dissemination Agent appointed or engaged by the Developer. The Dissemination Agent shall have no duty to prepare the Semi-Annual Report nor shall the Dissemination Agent be responsible for filing any Semi-Annual Report not provided to it by the Developer in a timely manner and in a form suitable for filing. lfthe Dissemination Agent is other than the Fiscal Agent, the Developer shall be responsible for paying the fees and expenses of the Dissemination Agent for its services provided hereunder in accordance with its schedule of fees as amended from time to time. If the Dissemination Agent is the Fiscal Agent, the District shall be responsible for paying the fees and expenses of the Dissemination Agent for its services provided hereunder in accordance with its agreement with the District. Section 8. Amendment; Waiver. Notwithstanding any other provision of this Disclosure Agreement, the Developer, the Fiscal Agent and the Dissemination Agent may amend this Disclosure Agreement (and the Fiscal Agent and the Dissemination Agent shall agree to any amendment so requested by the Developer, provided that the Fiscal Agent or the Dissemination Agent shall not be obligated to enter into such amendment that modifies or increases its duties and obligations hereunder), and any provision of this Disclosure Agreement may be amended or waived, provided that the following conditions are satisfied: (a) if the amendment or waiver relates to Sections 2(a), 3 or 4(a) hereof 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 (as defined in the Rule) with respect to the 2003 Bonds, or type of business conducted; (b) the undertakings herein, as proposed to be amended or waived, would, in the opinion of Bond Counsel approved by the Authority, have complied with the requirements of the Rule at the time of the primary offering of the 2003 Bonds, after taking into account any amendments or interpretations of the Rule, as well as any change in cimumstances; and (c) the proposed amendment or waiver either (i) is approved by owners of the 2003 Bonds in the manner provided in the Fiscal Agent Agreement for amendments to the Fiscal Agent Agreement with the consent of owners of the 2003 Bonds, or (ii) does not, in the opinion of Bond Counsel approved by the Authority, materially impair the interests of owners or beneficial owners of the 2003 Bonds. If the financial information or operating data contained within the Financial Statements to be provided in the Semi-Annual Report or amendment or supplement thereto is amended pursuant to the provisions hereof, the first Semi-Annual Report or amendment or supplement thereto containing the operating data or financial information in accordance with such amendment shall explain, in narrative form, the reasons for the amendment and the impact of the change in the type of operating data or financial information being provided. As required by the Rule, if an amendment is made to the provisions hereof specifying the accounting principles to be followed in preparing Financial Statements, the financial information for the year in which the change is made shall present a comparison between the Financial Statements or information prepared on the basis of the new accounting principles and those prepared on the basis of the former accounting principles. The comparison shall include a qualitative discussion of the differences in the accounting principles and the impact of the change in the accounting principles on the presentation of the Financial Statements, in order to enable investors to evaluate the ability of the Major Developer to generally meet its obligations. To the extent reasonably feasible, the comparison shall be quantitative. A notice of the change in the accounting principles shall be sent to the Repositories in the same manner as for a Listed Event under Section 4 hereof. Section 9. Additional Information. Nothing in this Disclosure Agreement shall be deemed to prevent the Developer from disseminating any other information, using the means of dissemination set forth in this Disclosure Agreement 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 Agreement. If the Developer chooses to include any information in any Semi-Annual Report or notice of occurrence ora Listed Event in addition to that which is specifically required by this Disclosure Agreement, the Developer shall have no obligation under this Disclosure Agreement to update such information or include it in any future Semi-Annual Report or notice of occurrence of a Listed Event. G-22 Section 10. Default. In the event of a failure of the Developer or the Fiscal Agent to comply with any provision of this Disclosure Agreement, the Fiscal Agent may (and, at the written direction of the Participating Underwriter or the owners of at least 25% aggregate principal amount of Outstanding 2003 Bonds, and after adequate indemnification shall), or any owner or beneficial owner of the 2003 Bonds may, take such actions as may be necessary and appropriate, including seeking mandate or specific performance by court order, to cause the Developer, the Dissemination Agent or the Fiscal Agent, as the case may be, to comply with its obligations under this Disclosure Agreement. A default under this Disclosure Agreement shall not be deemed an Event of Default under the Fiscal Agent Agreement, and the sole remedy under this Disclosure Agreement in the event of any failure of the Developer, the Dissemination Agent or the Fiscal Agent to comply with this Disclosure Agreement shall be an action to compel performance. Section 11. Duties, Immunities and Liabilities of Fiscal Agent and Dissemination Agent. Neither the Fiscal Agent nor the Dissemination Agent (if other than the Fiscal Agent or the Fiscal Agent in its capacity as Dissemination Agent) shall have any responsibility for the content of any Semi-Annual Report. The Dissemination Agent (if other than the Fiscal Agent or the Fiscal Agent in its capacity as Dissemination Agent) and the Fiscal Agent shall have only such duties as are specifically set forth in this Disclosure Agreement. The Developer agrees to indemnify and save each of the Fiscal Agent and the Dissemination Agent, and their respective officers, directors, employees and agents, harmless against any loss, expense and liabilities which it or they may incur arising out of or in the exemise or performance of their powers and duties hereunder, including the reasonable costs and expenses (including attorneys fees) of defending against any claim of liability with counsel approved by the Developer, which approval shall not be unreasonably withheld, but excluding losses, expenses and liabilities due to the Fiscal Agent's or the Dissemination Agent's negligence, willful misconduct or failure to comply with any provision of this Disclosure Agreement. The obligations of the Developer under this Section shall survive resignation or removal of such Dissemination Agent and payment of the 2003 Bonds and the resignation or removal of the Trustee. Any action for which indemnification is sought from the Developer shall be deemed an action on a contract (this Agreement) for which the provisions of Section 18 are applicable. All of the protections from liability applicable to the Fiscal Agent shall apply to the Dissemination Agent. The Dissemination Agent and Fiscal Agent shall have no responsibility for the preparation, review, form or content of any Semi-Annual Report or any notice of a Listed Event. No provision of this Disclosure Agreement shall require or be construed to require the Dissemination Agent or Fiscal Agent to interpret or provide an opinion concerning any information disclosed hereunder. Information disclosed hereunder by the Dissemination Agent may contain such disclaimer language concerning the Dissemination Agent's responsibilities hereunder with respect thereto as the Dissemination Agent may deem appropriate. The Dissemination Agent and Fiscal Agent may conclusively rely on the determination of the Developer as to the materiality of any event for purposes of Section 4 hereof. Neither the Fiscal Agent nor the Dissemination Agent make any representation as to the sufficiency of this Disclosure Agreement for purposes of the Rule. The Developer's obligations under this Section shall survive the termination of this Disclosure Agreement. Section 12. Notices. Any notice or communications to or among any of the parties to this Disclosure Agreement shall be given to all of the following and may be given as follows: If to the Developer: KB Home Coastal If to the Community Facilities District: If to the Dissemination Telephone: Telecopier: Attention: ., Chief Financial Officer Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 43200 Business Park Drive Temecula, California 92590 Attention: Finance Director Telephone: 909/694-6440 Telecopier: 909694-6499 U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 G-23 Telephone: 213/533-8712 Telecopier: 213/533-8729 If to the Fiscal Agent: U.S. Bank National Association 550 South Hope Street, Suite 500 Los Angeles, California 90071 Telephone: 213/533-8712 Telecopier: 213/533-8729 If to the Participating Underwriter: Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: 415/445-2300 Telecopier: 415/445-2395 Attention: Municipal Research Department Section 13. Beneficiaries. The Participating Underwriter and the owners and beneficial owners from time to time of the 2003 Bonds shall be third party beneficiaries under this Disclosure Agreement. This Disclosure Agreement shall inure solely to the benefit of the Developer, the Fiscal Agent, the Dissemination Agent, the Participating Underwriter and owners and beneficial owners from time to time of the 2003 Bonds, and shall create no rights in any other person or entity. Any action by a beneficiary of this Agreement shall be subject to Section 18 below. Section 14. Counterparts. This Disclosure Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. Section 15. Merger. Any person succeeding to all or substantially all of the Dissemination Agent's corporate trust business shall be the successor Dissemination Agent without the filing of any paper or any further act. Section 16. Severability. In case any one or more of the provisions contained herein shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof. Section 17. State of California Law Governs The validity, interpretation and performance of this Disclosure Agreement shall be governed by the laws of the State of California. Section 18. Attomeys' Fees. In the event of the bringing of any action or suit by any Party against another Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the other Party all costs and expenses of suit, including reasonable attorneys' fees. G-24 IN WITNESS WHEREOF, the parties hereto have executed this Disclosure Agreemem as of the date first above written. KB HOME COASTAL, INC., a California corporation By: Its: U.S. BANKNATIONALASSOC1ATION, as FiscalAgent By: Authorized Officer U.S. BANK NATIONAL ASSOCIATION, as Dissemination Agent By: Authorized Officer G-25 EXHIBIT A NOTICE TO MUNICIPAL SECURITIES RULEMAKING BOARD OF FAILURE TO FILE SEMI-ANNUAL REPORT Name of Obligated Person: Name of Bond Issue: Date of Issuance: KB Home Coastal, Inc., a California corporation Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds , 2003 NOTICE IS HEREBY GIVEN that KB Home Coastal, Inc. (the "Developer") has not provided a Semi-Annual Report with respect to the above-named Bonds as required by the Continuing Disclosure Agreement, dated as of June 1, 2003, by and between the Developer and U.S. Bank National Association, as Fiscal Agent and Dissemination Agent. [The Developer anticipates that the Semi-Annual Report will be filed by .] Dated: ,20__ U.S. BANK NATIONAL ASSOCIATION, as Dissemination Agent, on behalf of KB Home Coastal, Inc. Temecula Public Financing Authority c/o City of Temecula Stone & Youngberg LLC G-26 EXHIBIT B PARTICIPATING UNDERWRITER Stone & Youngberg LLC 50 California Street, 35th Floor San Francisco, California 94111 Telephone: 415/445-2300 Telecopier: 415/445-2395 Attention: Municipal Research Department. G-27 APPENDIX H FORM OF OPINION OF BOND COUNSEL APPENDIX I BOOK-ENTRY SYSTEM The following description of the procedures and record keeping with respect to beneficial ownership interests in the 2003 Bonds, payment of principal of and interest on the 2003 Bonds to Direct Participants, Indirect Participants or Beneficial Owners (as such terms are defined below) of the 2003 Bonds, confirmation and transfer of beneficial ownership interests in the 2003 Bonds and other Bond-related transactions by and between DTC, Direct Participants, Indirect Participants and Beneficial Owners of the 2003 Bonds is based solely on information furnished by DTC to the District which the District believes to be reliable, but the Authority, the District and the Underwriter do not and cannot make any independent representations concerning these matters and do not take responsibility for the accuracy or completeness thereof Neither the DTC, Direct Participants, Indirect Participants nor the Beneficial Owners should rely on the foregoing information with respect to such matters, but shouM instead confirm the same with DTC or the DTC Participants, as the case may be. The Depository Trust Company ("DTC"), New York, New York, will act as securities depository for the 2003 Bonds. The 2003 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 2003 Bond will be issued for each maturity of the 2003 Bonds, each in the aggregate principal amount of such maturity and will be deposited with DTC. DTC, the world's largest depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 2 million issues of U.S. and non-U.S, equity issues, corporate and municipal debt issues and money market instruments from over 85 countries that DTC's participants (the "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 & Cleating Corporation ("DTCC"). DTCC, in turn, is owned by a number of Direct Participants of DTC and Members of the National Securities Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing Corporation, and Emerging Markets Clearing Corporation, (NSCC, GSCC, MBSCC, and EMCC, also subsidiaries of DTCC), as well as by the New York Stock Exchange, Inc., the American Stock Exchange LLC, and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as 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 (the "Indirect Participants"). DTC has Standard & Poor's highest rating: AAA. 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 Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the 2003 Bonds on DTC's records. The ownership interest of each actual purchaser &each 2003 Bond (the "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 2003 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 I-I not receive certificates representing their ownership interests in the 2003 Bonds, except in the event that use of the book-entry system for the 2003 Bonds is discontinued. To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC are registered in the name of DTC's parmership nominee, Cede & Co. or such other name as requested by an authorized representative of DTC. The deposit of 2003 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 2003 Bonds; DTC's records reflect only the identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be the Beneficial Owners. The Direct or Indirect Participants will remain responsible for keeping account of their holdings on behaifoftheir 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 2003 Bonds may wish to take certain steps to augment the transmissions to them of notices of significant events with respect to the 2003 Bonds, such as redemptions, tenders, defaults, and proposed amendments to the 2003 Bonds documents. For example, Beneficial Owners of 2003 Bonds may wish to ascertain that the nominee holding the 2003 Bonds for their benefit has agreed to obtain and transmit notices to Beneficial Owners. Redemption notices shall be sent to DTC. If less than all ofthe 2003 Bonds 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 such other DTC nominee) will consent or vote with respect to the 2003 Bonds unless authorized by a Direct Participant in accordance with DTC's 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 the 2003 Bonds are credited on the Record Date (identified in a listing attached to the Omnibus Proxy). Principal, redemption price and interest payment on the 2003 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, the Authority or the Fiscal Agent, on a payment 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 (nor the nominee), the Fiscal Agent, the Authority or the District, subject to any statutory and regulatory requirements as may be in effect from time to time. Payment of principal, redemption price and interest payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of 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 service as depository with respect to the 2003 Bonds at any time by giving reasonable notice to 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 as described in the Fiscal Agent Agreement. The Authority may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, Bond certificates will be printed and delivered as described in the Fiscal Agent Agreement. 1-2 The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that the Authority and the District believe to be reliable, but the Authority and the District take no responsibility for the accuracy thereofi Discontinuance of DTC Services In the event that (a) DTC determines not to continue to act as securities depository for the 2003 Bonds, or (b) the Authority determines that DTC shall no longer act and delivers a written certificate to the Fiscal Agent to that effect, then the Authority will discontinue the Book-Entry System with DTC for the 2003 Bonds. If the Authority determines to replace DTC with another qualified securities depository, the Authority will prepare or direct the preparation ora new single separate, fully registered Bond for each maturity of the 2003 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 Authority fails to identify another qualified securities depository to replace the incumbent securities depository for the 2003 Bonds, then the 2003 Bonds shall no longer be restricted to being registered in the 2003 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 2003 Bonds shall designate. In the event that the Book-Entry System is discontinued, the following provisions would also apply: (i) the 2003 Bonds will be made available in physical form, (ii) principal of, and redemption premiums if any, on the 2003 Bonds will be payable upon surrender thereof at the trust office of the Fiscal Agent identified in the Fiscal Agent Agreement, and (iii) the 2003 Bonds will be transferable and exchangeable as provided in the Fiscal Agent Agreement. The Authority, the District and 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 2003 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 theprincipal of redemptionprice o for interest on the 2003 Bonds; (iiO 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 2003 Bonds; (v) any consent given or other action taken by DTC as registered owner; or (vi) any other matter arising with respect to the 2003 Bonds or the Fiscal Agent Agreement. The Authority, the District and the Fiscal Agent cannot and do not give any ass urances that DTC, DTC Participants or others will distribute payments of principal of or interest on the 2003 Bonds paM 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 Authority, the District and 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 2003 Bonds or any error or delay relating thereto. I-3 $ TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS BOND PURCHASE AGREEMENT May ,2003 Temecula Public Financing Authority 43200 Business Park Drive Temecula, California 92590 Ladies and Gentlemen: Stone & Youngberg LLC (the "Underwriter") offers to enter into this Bond Purchase Agreement (the "Bond Purchase Agreement") with the Temecula Public Financing Authority (the "Authority") for and on behalfofTemecula Public Financing Authority Community Facilities District No. 03- I (Crowne Hill) (the "District") which, upon acceptance, will be binding upon the Authority and upon the Underwriter. This offer is made subject to acceptance of it by the Authority on the date hereof, and if not accepted will be subject to withdrawal by the Underwriter upon notice delivered to the Authority at any time prior to the acceptance hereof by the Authority. I. Purchase, Sale and Delivery of the Bonds (a) Subject to the terms and conditions and in reliance upon the representations, warranties and agreements set forth herein, the Underwriter agrees to purchase from the Authority, and the Authority agrees to sell to the Underwriter, all (but not less than all) of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds (the "Bonds") in the aggregate principal amount orS . The Bonds are dated their date of delivery, and bear interest at the rates set forth in Exhibit A hereto (payable on each March I and September I of each year, commencing September 1, 2003) and mature on September 1, 2033. The purchase price for the Bonds shall be as set forth in Exhibit A hereto. The Bonds will be subject to demand for and mandatory purchase pursuant to the provisions of the Fiscal Agent Agreement by and between the Authority and U.S. Bank National Association, as fiscal agent (the "Fiscal Agent") dated as of June 1, 2003 (the "Fiscal Agent Agreement"). The Bonds shall be substantially in the form described in, shall be issued and secured under the provisions of, and shall be payable and subject to redemption as provided in, the Fiscal Agent Agreement. The Bonds and interest thereon will be payable from a special tax (the "Special Tax") levied and collected in accordance with the Fiscal Agent Agreement and Ordinance No. TPFA 03-01 (Crowne Hill) (the "Ordinance") adopted by the Board of Directors of the Authority (the "Board") on April 8, 2003, pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California) (the "Act"). The proceeds of the Bonds shall be applied (i) to finance the acquisition and construction of certain street and signal improvements, storm drain improvements, sewer and water improvement, fire protection improvements and park and recreation improvements (collectively, the "Improvements") within or in the vicinity of the District, (ii) to eliminate in whole [or in part] an existing special assessment lien (the "Prior Lien") on pamels in the District, (iii) to pay interest on the 2003 Bonds for a limited period of time, (iv) to pay certain administrative expenses of the District (v) to pay the costs of issuing the 2003 Bonds and (vi) to establish a Reserve Fund for the 2003 Bonds. TEMCH BPAh.wlxt/LR/424 (b) Pursuant to the authorization of the Authority, the Underwriter has distributed copies of the Preliminary Official Statement, dated May ,2003, relating to the Bonds, which, together with the cover page and all appendices thereto, is herein called the "Preliminary Official Statement" and which, as amended by the Authority with the prior approval of the Underwriter, will be referred to herein as the "Official Statement." The Authority hereby ratifies the use by the Underwriter of the Preliminary Official Statement and authorizes the Underwriter to use and distribute the Official Statement, the Fiscal Agent Agreement, the other documents or contracts to which the Authority is a party, including this Bond Purchase Agreement, relating to the Bonds, and all information contained therein, and all other documents, certificates and statements furnished by the Authority to the Underwriter in connection with the transactions contemplated by this Bond Purchase Agreement, in connection with the offer and sale of the Bonds by the Underwriter. (c) At 8:00 A.M., Los Angeles time, on June ,2003, or at such other time or on such earlier or later business day as shall be agreed upon by the Underwriter and the Authority (such time and date being herein referred to as the "Closing Date"), the Authority will deliver to the Underwriter (i) at the offices of The Depository Trust Company, in New York, New York, the Bonds in temporary or definitive form, bearing CUSIP numbers, and duly executed by the officers of the Authority and authenticated by the Fiscal Agent as provided in the Fiscal Agent Agreement, and (ii) at the offices of Quint & Thimmig LLP in San Francisco, California, the other documents herein mentioned; and the Underwriter shall accept such delivery and pay the purchase price of the Bonds as set forth in Section l(a) hereof by wire transfer of immediately available funds. The date of this payment and delivery, together with the delivery of the aforementioned documents, is herein called the "Closing." Notwithstanding the foregoing, the Underwriter may, in its discretion, accept delivery of the Bonds in temporary form upon making arrangements with the Authority which are satisfactory to the Underwriter relating to the delivery of the Bonds in definitive form. The Bonds shall be in fully registered form, registered in the name of CEDE & Co., as nominee of The Depository Trust Company. The failure to print CUSIP identification numbers on any of the Bonds or any error with respect thereto shall not constitute cause for a failure or refusal of the Underwriter to accept delivery of, or pay for, the Bonds in accordance with the terms of this Bond Pumhase Agreement. (d) The Underwriter agrees to offer all the Bonds to the public initially at the a price of par. Subsequent to the initial public offering of the Bonds, the Underwriter reserves the right to change the public offering prices (or yields) as it deems necessary in connection with the marketing of the Bonds. The Bonds may be offered and sold to certain dealers at prices lower than such initial public offering prices. 2. Representations, Warranties and Agreements of the Authority. The Authority represents, warrants and covenants to and agrees with the Underwriter that: (a) The District is duly organized and validly existing as a community facilities district under the laws of the State of California (the "State") and the Authority has, and at the Closing Date will have, as the case may be, full legal right, power and authority for and on behalf of the District (i) to adopt the Procedural Resolutions (as defined below) and the Ordinance, (ii) to execute and deliver the Bonds and the District Documents (as defined below) and to perform its obligations under the Bonds and the District Documents, (iii) to issue, sell and deliver the Bonds to the Underwriter pursuant to the Procedural Resolutions and the Fiscal Agent Agreement as provided herein, and (iv) to carry out, give effect to and consummate the transactions on its part contemplated by the Procedural Resolutions, the Official Statement, the Bonds and the District Documents. For purposes of this Bond Purchase Agreement, Resolution No. TPFA 03-1 adopted by the Board on January 28, 2003 stating the intention to establish the District, Resolution No. TPFA 03-__ adopted by the Board on January 28, 2003 stating the intention to incur bonded indebtedness, Resolution No. TPFA 03- adopted by the Board on March 25, 2003 establishing the District and authorizing the levy of the Special Tax within the District, Resolution No. TPFA 03-__ adopted by the Board on March 25, 2003 declaring the necessity to incur bonded indebtedness, Resolution No. TPFA 03-__ adopted by the Board 2 TEMCH BPAh.wpd/LR/424 on March 25, 2003 calling for a special election in the District, Resolution No. TPFA 03- adopted by the Board on March 25, 2003 declaring the results of the election, Resolution No. TPFA 03- adopted by the Board on May 13, 2003, calling for a of special ratifying election, Resolution No. TPFA 03- adopted by the Board on May 13, 2003, declaring results of special ratifying election and directing recording of notice of special tax lien, and Resolution No. TPFA 03- __ adopted by the Board on May 13, 2003 authorizing the issuance of the Bonds are referred to as the "Procedural Resolutions" and the Fiscal Agent Agreement, the Bond Purchase Agreement, the District Continuing Disclosure Agreement (the "District Continuing Disclosure Agreement"), dated as of June I, 2003 by and between the District and U.S. Bank National Association, as dissemination agent (the "Dissemination Agent"), the Acquisition Agreement (the "Acquisition Agreement"), dated as of March 1, 2003 by and between the Authority and Lennar Homes of California, Inc., a California corporation ("Lennar Homes"), and the Joint Community Facilities Agreement - City (the "Joint Community Facilities Agreement - City"), dated as of March 1, 2003 by and between the Temecula Public Financing Authority and the City of Temecula (the "City"), the Joint Community Facilities Agreement -RCWD (the "Joint Community Facilities Agreement - RCWD"), dated as of March 1, 2003 by and among the Temecula Public Financing Authority, the Rancho California Water District ("RCWD") and Lennar Homes, the Joint Community Facilities Agreement - EMWD (the "Joint Community Facilities Agreement - EMWD"), dated as of March 1,2003 by and among the Temecula Public Financing Authority, Eastern Municipal Water District ("EMWD") and Lennar Homes, and the Joint Community Facilities Agreement - Cai Trans (the "Joint Community Facilities Agreement - Cai Trans"), dated as of March 1, 2003 by and between the Temecula Public Financing Authority and the State of California Department of Transportation are referred to herein as the "District Documents"); (b) The Authority has complied, and will at the Closing Date be in compliance, in all respects material to issuance and delivery of the Bonds with the Bonds, the District Documents and the Act and the Authority will continue to comply with the covenants of the Authority contained in the Bonds and the District Documents; (c) The Board for and on behalf of the District has duly and validly: (i) adopted the Procedural Resolutions and the Ordinance, (ii) called, held and conducted in accordance with all requirements of the Act an election to approve the levy of the Special Tax, (iii) authorized the preparation and delivery of the Preliminary Official Statement andthe Official Statement, (iv) authorized and approvedthe execution and delivery of the Bonds and the District Documents; and (v) authorized and approved the performance by the Authority of its obligations contained in, and the taking of any and all action on its part as may be necessary to carry out, give effect to and consummate the transactions on its part contemplated by, each of said documents (including, without limitation, the levy and collection of the Special Tax and the use of the proceeds of the Bonds to acquire public improvements), and at the Closing Date the Bonds and the District Documents have been, or on or before the Closing Date, will be duly executed and delivered by the Authority and on the Closing Date, the Bonds and the District Documents will constitute the valid, legal and binding obligations of the Authority on behalf of the District, and (assuming due authorization, execution and delivery by other parties thereto, where necessary of the other parties thereto) will be enforceable in accordance with their respective terms, subject to bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights in general and to the application of equitable principles if equitable remedies are sought; (d) The Authority is not in breach of or default under any applicable law or administrative rule or regulation of the State or the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Authority is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the performance by the Authority of its obligations under the Procedural Resolutions, the Ordinance, the Bonds or the District Documents and compliance with the provisions of each 3 TEMCH BPAh,wpd/LR/424 thereof, will not conflict with or constitute a broach of or default under any applicable law or administrative rule or regulation of the State, or of any department, division, agency or instrumentality thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Authority is a party or is otherwise subject or bound a consequence of which could be to materially and adversely affect the ability of the Authority to perform its obligations under the Bonds or any District Documents; (e) The adoption of the Procedural Resolutions and the Ordinance, and the execution and delivery by the Authority of the Bonds, the Official Statement and the District Documents and compliance by the Authority with the provisions thereof, did not and will not conflict with or constitute a breach of or default under any applicable law or administrative rule or regulation of the State or the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Authority is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the ability of the Authority to perform its obligations under the Bonds or any of the District Documents; (f) All approvals, consents, authorizations, elections and orders of or filings or registrations with any State governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would materially adversely affect, the ability of the Authority to execute and deliver and perform its obligations under the Bonds or the District Documents have been or will be obtained and are in full force and effect, except that the Authority provides no representation regarding compliance with "Blue Sky" or other securities laws or regulations whatsoever; (g) The Bonds, the Procedural Resolutions, the Ordinance and the District Documents conform as to form and tenor to the descriptions thereof contained in the Preliminary Official Statement, and which will be contained in the Official Statement as of the Closing Date, and when delivered to and paid for by the Underwriter on the Closing Date as provided herein, the Bonds will be validly issued and outstanding; (h) The Special Tax constituting the security for the Bonds has been duly and lawfully authorized and may be levied under the Act and the Constitution and the applicable laws of the State, and such Special Tax, when levied, will constitute a valid lien on the properties on which it has been levied; (i) Except as described in the Official Statement under the caption"THE COMMUNITY FACILITIES DISTRICT - Direct and Overlapping Debt," "- Overlapping Assessment and Community Facilities Districts" and"- Other Overlapping Direct Assessments," there are no outstanding assessment liens or special tax liens levied by the Authority for itself or on behalf of any community facilities district or assessment district against any of the properties within the District which are senior to the Special Tax lien referred to in paragraph l(a) hereof, and the Authority has no present intention of conducting further proceedings leading to the levying of additional special taxes or assessments against any of the properties within the District; (j) As of the dine thereof, the Preliminary Official Statement (excluding the information under the captions of"THE COMMUNITY FACILITIES DISTRICT - Property Ownership," as to which the Authority and the District shall not be required to express any view) did not contain any untrue statement ora material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; the Official Statement (excluding the information under the captions of "THE COMMUNITY FACILITIES DISTRICT- Property Ownership," as to which the Authority and the District shall not be required to express any view) does not and, as of the Closing Date, will not contain any untrue or misleading statement of a 4 TEMCH BPAh.wpd/LR/424 material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (k) After the Closing Date and until the date which is twenty-five (25) days after the underwriting period (as defined below) (i) the Authority will not adopt any amendment of or supplement to the Official Statement to which the Underwriter shall object in writing or which shall be disapproved by counsel for the Underwriter, and (ii) if any event shall occur of which the Authority is aware, as a result of which it is necessary, in the reasonable opinion of counsel for the Underwriter, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to an initial purchaser of the Bonds, the Authority will forthwith prepare and furnish to the Underwriter a reasonable number of copies of an amendment of or supplement to the Official Statement (in form and substance satisfactory to counsel for the Underwriter) which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to an initial purchaser of the Bonds, not misleading. The costs of preparing any necessary amendment or supplement to the Official Statement shall be borne by the District. The term "end of the underwriting period" means the later of such time as (i) the Authority delivers the Bonds to the Underwriter or (ii) the Underwriter does not retain an unsold balance of the Bonds for sale to the public. Unless the Underwriter gives notice to the contrary, the "end of the underwriting period" shall be deemed to be the Closing Date. Any notice delivered pursuant to this provision shall be written notice delivered to the Authority at or prior to the Closing Date, and shall specify a date (other than the Closing Date) to be deemed the "end of the underwriting period;" (I) The Fiscal Agent Agreement creates a valid pledge of the Special Tax Revenues and any other amounts (including proceeds of the sale of the Bonds) held in the Bond Fund and the Special Tax Fund established pursuant to the Fiscal Agent Agreement, subject in all cases to the provisions of the Fiscal Agent Agreement permitting the application thereof for the purposes and on the terms and conditions set forth therein; (m) No action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending against the Authority with respect to which the Authority has been served with process, or to the knowledge of the Authority threatened, affecting the existence of the Authority or the District or the titles of its officers to their respective offices (i) which would materially adversely affect the ability of the Authority to perform its obligations under the Bonds or the District Documents, or (ii) seeking to restrain or to enjoin the development of the land within the District, the issuance, sale or delivery of the Bonds, the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax pledged or to be pledged to pay the principal of and interest on the Bonds, or the pledge thereof, or in any way contesting or affecting the validity or enforceability of the Bonds, the District Documents, any other instruments relating to the development of any of the property within the District, or any action of the Authority contemplated by any of said documents, or (iii) in any way contesting the completeness or accuracy of the Preliminary Official Statement or the Official Statement or the powers or authority of the Authority with respect to the Procedural Resolutions, the Ordinance, the Bonds or the District Documents, or any action of the Authority contemplated by any of said documents; or (iv) which alleges that interest on the Bonds is not excludable from gross income for federal income tax purposes or is not exempt from State personal income taxation, nor to the knowledge of the Authority is there any basis therefor; (n) The Authority will furnish such information, execute such instruments and take such other action in cooperation with the Underwriter as the Underwriter may reasonably request in order for the Underwriter to qualify the Bonds for offer and sale under the "Blue Sky" or other securities laws and regulations of such states and other jurisdictions of the United States as the Underwriter may designate; 5 TEMCH B?Ah.wpd/LR/424 provided, however, the Authority shall not be required to register as a dealer or a broker of securities nor shall the Authority be required to consent to service of process or jurisdiction or qualify to do business in any jurisdiction or to expend funds for this purpose; (o) Any certificate signed by any official of the Authority authorized to do so and delivered by the Authority at the Closing shall be deemed a certification to the Underwriter by the Authority as to the statements made therein; (p) During the period from the date hereof until the Closing Date, the Authority agrees to furnish the Underwriter with copies of any documents it files with any regulatory authority which are requested by the Underwriter; (q) The Authority is not in default, nor has the Authority been in default at any time, as to the payment of principal or interest with respect to an obligation issued by the Authority or with respect to an obligation guaranteed by the Authority as guarantor; (r) The Authority will apply the proceeds from the sale of the Bonds as set forth in and for the purposes specified in the Fiscal Agent Agreement; (s) The Authority will undertake, pursuant to the Fiscal Agent Agreement and the District Continuing Disclosure Agreement to provide certain annual financial information and information about the District, together with notices of the occurrence of certain events, if material. A copy of the District Continuing Disclosure Agreement is set forth in Appendix F of the Preliminary Official Statement and will also be set forth in the Official Statement, and the specific nature of the information to be contained in the Annual Report (as defined in the District Continuing Disclosure Agreement) or the notices of material events is set forth in the District Continuing Disclosure Agreement; (t) The Preliminary Official Statement heretofore delivered to the Underwriter was, and hereby is, expressly deemed final by the Authority as of its date, except for the omission of such information as is permitted to be omitted in accordance with paragraph (b)(1) of Section 240.15c2-12 in Chapter II of Title 17 of the Code of Federal Regulations ("Rule t5c2-12"). The Authority hereby covenants and agrees that, within seven (7) business days from the date hereof, or upon reasonable written notice from the Underwriter within sufficient time to accompany any conformation requesting payment from any customers of the Underwriter, the Authority shall cause a final printed form of the Official Statement to be delivered to the Underwriter in sufficient quantity specified by the Underwriter to comply with paragraph (b)(4) of Rule 15c2- 12 and Rules G-12, G-15, G-32 and G-36 of the Municipal Securities Rulemaking Board; (u) The District has not failed to comply with any continuing disclosure undertaking previously entered into in connection with the provisions of Rule 15c2-12(b)(5); and (v) Except as disclosed in the Official Statement, the Authority and the City have not failed to comply with any continuing disclosure undertaking previously entered into for itself or on behalf of another entity, in connection with the provisions of Rule 15c2-12(b)(5). 3. Conditions to the Obligations of the Underwriter. The obligations of the Underwriter to accept delivery of and pay for the Bonds on the Closing Date shall be subject, at the option of the Underwriter, to the accuracy in all material respects of the representations and warranties on the part of the Authority contained herein, as of the date hereof and as of the Closing Date, to the accuracy in all material respects of the statements of the officers and other officials of the Authority made in any certificates or other documents furnished pursuant to the provisions hereof, to the performance by the Authority of its obligations to be performed hereunder at or prior to the Closing Date and to the following additional conditions: 6 TEMCH BPAh.wpd/LR~424 (a) At the Closing Date, the Procedural Resolutions, the Ordinance, the Bonds, the District Documents, and any other applicable agreements, shall be in full fome and effect, and shall not have been amended, modified or supplemented, except as may have been agreed to in writing by the Underwriter, and them shall have been taken in connection therewith, with the issuance of the Bonds and with the transactions contemplated thereby and by this Bond Purchase Agreement, all such actions as, in the opinion of Quint & Thimmig LLP, San Francisco, California ("Bond Counsel"), shall be necessary and appropriate. (b) At the Closing Date, the Official Statement shall be in form and substance satisfactory to the Underwriter and the Authority and shall not contain any untrue statement ora material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. (c) Between the date hereof and the Closing Date, the market price or marketability of the Bonds at the initial offering prices set forth in the Official Statement shall not have been materially adversely affected, in the reasonable judgment of the Underwriter (evidenced by a written notice to the Authority terminating the obligation of the Underwriter to accept delivery of and pay for the Bonds), by reason of any of the following: (1) legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America or recommended to the Congress by the President of the United States, the Department of the Treasury, the Internal Revenue Service, or any member of Congress, or favorably reported for passage to either House of Congmss by any committee of such House to which such legislation had been referred for consideration or a decision rendered by a court established under Article III of the Constitution of the United States of America or by the Tax Court of the United States of America, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Treasury Department or the Internal Revenue Service of the United States of America, with the purpose or effect, directly or indirectly, of imposing federal income taxation upon the interest as would be received by the owners of the Bonds beyond the extent to which such interest is subject to taxation as of the date hereof; (2) legislation introduced in or enacted (or resolution passed) by the Congress of the United States of America, or an order, decree or injunction issued by any court of competent jurisdiction, or an order, ruling, regulation (final, temporary or proposed), press release or other form of notice issued or made by or on behalf of the Securities and Exchange Commission, or any other governmental agency having jurisdiction of the subject matter, to the effect that obligations of the general character of the Bonds, or the Bonds, including any or all underlying arrangements, are not exempt from registration under or other requirements of the Securities Act of 1933, as amended, or that the Fiscal Agent Agreemem is not exempt from qualification under or other requirements of the Trust Indenture Act of 1939, as amended, or that the issuance, offering or sale of obligations of the general character of the Bonds, or of the Bonds, including any or all underwriting arrangements, as contemplated hereby or by the Official Statement or otherwise is or would be in violation of the federal securities laws as amended and then in effect; (3) a general suspension of trading in securities on the New York Stock Exchange, or a general banking moratorium declared by Federal, State of New York or State officials authorized to do so; (4) any amendment to the federal or State Constitution or action by any federal or State court, legislative body, regulatory body or other authority materially adversely affecting the tax status of the Authority or the District, its property, income, securities (or interest thereon) or the validity or enforceability of the Special Tax; 7 TEMCH BPAh.wlXl/LR/424 (5) any event occurring, or information becoming known, which, in the reasonable judgment of the Underwriter, makes untrue in any material respect any statement or information contained in the Official Statement, or results in the Official Statement containing any untrue or misleading statement ora material fact or omitting to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; (6) the entry of an order by a court of competent jurisdiction which enjoins or restrains the City from issuing permits, licenses or entitlements within the District, which order, in the reasonable opinion of the Underwriter, materially and advemely affects proposed developments within the District in particular or the City in general; (7) any legislation, ordinance, rule or regulation shall be introduced in, or be enacted by any governmental body, department or agency of the State or a decision by any court of competent jurisdiction within the State or any court of the United States shall be rendered which, in the reasonable opinion of the Underwriter, materially adversely affects the market price of the Bonds; (8) additional material restrictions not in force as of the date hereof shall have been imposed upon trading in securities generally by any governmental authority or by any national securities exchange which restrictions materially adversely affect the Underwriter's ability to market the Bonds; or (9) the United States has become engaged in hostilities which have resulted in a declaration of war or a national emergency or there has occurred any other outbreak or escalation of hostilities or a national or international calamity or crisis, financial or otherwise, the effect of such outbreak, calamity or crisis on the financial markets of the United States, being such as, in the reasonable opinion of the Underwriter, would affect materially and adversely the ability of the Underwriter to market the Bonds. (d) On or prior to the Closing Date, the Underwriter shall have received two counterpart originals or certified copies of each of the following documents, in each case satisfactory in form and substance to the Underwriter: (1) The Procedural Resolutions and the Ordinance, together with a certificate dated as of the Closing Date of the Secretary of the Board to the effect that each is a true, correct and complete copy of the one duly adopted by the Board; (2) An executed copy of the Fiscal Agent Agreement; (3) An executed copy of this Bond Purchase Agreement; (4) An executed copy of the Official Statement; (5) An executed copy of the District Continuing Disclosure Agreement; (6) An executed copy of the Acquisition Agreement; (7) An executed copy of the Joint Community Facilities Agreements; (8) An approving opinion, dated the Closing Date and addressed to the Authority, of Bond Counsel for the Authority, in the form attached to the Official Statement as 8 TEMCH BPAh.wpd/LR/424 Appendix H and a letter, dated the Closing Date and addressed to the Underwriter, to the effect that such opinion addressed to the Authority may be relied upon by the Underwriter to the same extent as if such opinion was addressed to it; (9) A supplemental opinion, dated the Closing Date and addressed to the Underwriter of Bond Counsel to the effect that (i) the Bonds are not subject to the registration requirements of the Securities Act of 1933, as amended and the Fiscal Agent Agreement is exempt from qualification pumuant to the Trust Indenture Act of 1939, as amended; (ii) the Bond Purchase Agreement has been duly authorized, executed and delivered by the Authority, and (assuming the due authorization, execution and delivery by, and validity against, the Underwriter) is a valid and binding agreement of the Authority enforceable in accordance with its terms, except as enforcement may be limited by bankruptcy, moratorium, insolvency or other laws affecting creditor's rights or remedies and is subject to general principles of equity (regardless of whether such enforceability is considered in equity or at law); (iii) the statements contained in the Official Statement on the cover page and under the captions "INTRODUCTION - Sources of Payment for the 2003 Bonds," "INTRODUCTION - Tax Exemption," "THE 2003 BONDS," "SECURiTY FOR THE 2003 BONDS," "LEGAL MATTERS - Tax Exemption," APPENDIX E - "Summary of Certain Provisions of the Fiscal Agent Agreement" and APPENDIX H-"Form of Opinion of Bond Counsel" and are accurate insofar as such statements expressly summarize certain provisions of the Bonds, the Fiscal Agent Agreement and such firm's opinion concerning certain federal tax mattem relating to the Bonds and (iv) the District is duly formed as a community facilities district under the Act; (10) An opinion, dated the Closing Date and addressed to the District and the Underwriter of McFarlin & Anderson, Disclosure Counsel, to the effect that without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the District, Richards, Watson & Gershon ("District Counsel"), Bond Counsel, representatives of the Underwriter, representatives of Lennar Homes, Pillsbury Winthrop LLP, as counsel to the Lennar Merchant Builders, and othem, and their examination of certain documents, no information has come to their attention which would lead them to believe that the Official Statement as of its date and as of the Closing Date contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to the information concerning the information under the captions APPENDIX B - "Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Rate and Method of Apportionment of Special Tax," APPENDIX D - "Summary of Certain Provisions of Fiscal Agent Agreement," APPENDIX H - "Form of Opinion of Bond Counsel" and APPENDIX l - "Book-Entry System," any financial, statistical or economic data or forecasts, numbers, charts, tables, graphs, maps, estimates, projections, assumptions or expressions of opinion, or any information about valuation, appraisals, market absorption or environmental matters or any information about book-entry or DTC contained in the Official Statement); (11) An opinion, dated the Closing Date and addressed to the Underwriter, of the City Attorney, as counsel to the Authority and to the District, to the effect that: (i) The Authority is duly organized and validly existing under the Constitution and laws of the State of California; 9 TEMCH BPAh.wpt~LR/424 (ii) The District is duly organized and validly existing as a community facilities district under the laws of the State, with full legal right, power and authority to issue the Bonds and to perform all of its obligations under the Bonds and the District Documents; (iii) To the best of such counsel's knowledge, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body is pending or threatened against the Authority or the District affecting the existence of the Authority or the District or the title of their officers to their respective offices, or which would materially adversely affect the ability of the Authority to perform its obligations hereunder or under the Bonds or the District Documents or seeking to restrain or to enjoin the development of property within the District, the issuance, sale, or delivery of the Bonds or the exclusion from gross income for federal income tax purposes or State personal income taxes of interest on the Bonds, or the application of the proceeds thereof in accordance with the Fiscal Agent Agreement, or the collection or application of the Special Tax to pay the principal of and interest on the Bonds, or in any way contesting or affecting the validity or enforceability of the Bonds or the District Documents or any action of the Authority contemplated by any of said documents or the accuracy or completeness of the Preliminary Official Statement or the Official Statement; (iv) The Board on behalf of the District has duly and validly adopted the Procedural Resolutions and the Ordinance at meetings of the Board which were called and held pursuant to law and with all public notice required by law and at which a quorum was present and acting at the time of adoption, and the Procedural Resolutions and the Ordinance are now in full fome and effect and have not been amended; (v) To the best of such counsel's knowledge, the Authority and the District are not in breach of or in default under any applicable law or administrative rule or regulation of the State or the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Authority or the District is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the ability of the Authority or the District to perform their obligations under the Procedural Resolutions, the Ordinance, the Bonds or any District Documents or which, with the passage of time or the giving of notice or both, would constitute an event of default thereunder; (vi) The adoption of the Procedural Resolutions and the Ordinance, and the execution and delivery of the Bonds and the District Documents, and compliance with the provisions of each, did not and will not conflict with or constitute a breach of or default under any applicable court or administrative decree or order, or under any loan agreement, note, ordinance, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Authority or the District is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the ability of the Authority to perform its obligations under the Bonds or any District Documents; and (vii) Without having undertaken to determine independently the accuracy, completeness or fairness of the statements contained in the Official Statement, but on the basis of their participation in conferences with representatives of the Authority, the District, Bond Counsel, Disclosure Counsel, representatives of the Underwriter, Lennar Communities, Inc. CLennar Communities") and others, and their examination of certain documents, no information has come to their attention which would lead them to believe that the information with respect to the Authority and the District in the Official Statement, as of its date and as of the Closing Date, contained any untrue statement ora material fact 1 0 TEMCH BPAh.wpcVLR/424 or omitted to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (except that no opinion or belief need be expressed as to any Appendix to the Official Statement or any other financial, statistical or economic data or forecasts, numbers, charts, graphs, estimates, projections, assumptions or expressions of opinion, or any information about valuation or appraisals, or any information about Lennar Communities, the Lennar Merchant Builders, LENOne, PCC 100, KB Home Coastal, PCC 11I (as such terms are defined in the Official Statement) the book-entry or DTC contained in the Official Statement); (12) A Certificate, dated the Closing Date and signed by an authorized representative of the Authority, certifying that (i) the representations and warranties of the Authority contained in this Bond Purchase Agreement are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date; (ii) no event has occurred since the date of the Official Statement affecting the matters contained therein which should be disclosed in the Official Statement for the purposes for which it is to be used in order to make the statements and information contained in the Official Statement with respect to the Authority or the District not misleading in any material respect; (iii) the Authority has complied with all the agreements and satisfied all the conditions on its part to be performed or satisfied under the Bonds and the District Documents at or prior to the Closing Date in order to issue the Bonds; (13) A certificate of the Authority, in a form acceptable to Bond Counsel, containing the Authority's reasonable expectations in support of the conclusion that the Bonds are not arbitrage bonds within the meaning of Section 148 of the Internal Revenue Code of 1986, as amended; (14) Anopinionofcounseltothe FiscalAgent, datedtheClosing Date, addressed to the Underwriter, in form and substance satisfactory to the Underwriter, to the effect that: (i) The Fiscal Agent is a national banking association, organized and existing under and by virtue of the laws of the United States of America; (ii) The Fiscal Agent has duly authorized the execution and delivery of the Fiscal Agent Agreement and the Continuing Disclosure Agreements (as defined below); (iii) The Fiscal Agent Agreement and the Continuing Disclosure Agreements have been duly entered into and delivered by the Fiscal Agent and assuming due, valid and binding authorization, execution and delivery by the other parties thereto, constitute the legal, valid and binding obligations of the Fiscal Agent enforceable against the Fiscal Agent in accordance with their terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency or other similar laws affecting the enforcement of creditors' rights generally, or by general principles of equity; (iv) Acceptance by the Fiscal Agent of the duties and obligations under the Fiscal Agent Agreement, and the Continuing Disclosure Agreements and compliance with provisions thereof will not conflict with or constitute a breach of or default under any law or administrative regulation, court decree, resolution, charter, by-laws, agreement, instrument or commitment to which the Fiscal Agent is subject; (v) All approvals, consents and orders of any governmental authority or agency having jurisdiction in the matter which would constitute a condition precedent to the performance by the 1 1 TEMCH BPAh.wi~t/LR/424 Fiscal Agent of its duties and obligations under the Fiscal Agent Agreement, and the Continuing Disclosure Agreements have been obtained and are in full force and effect; (vi) To such counsel's knowledge, there is no litigation pending or threatened against or affecting the Fiscal Agent to restrain or enjoin the Fiscal Agent's participation in, or in any way contesting the powers of the Fiscal Agent with respect to the transactions contemplated by the Bonds or the Fiscal Agent Agreement; and (vii) To such counsel's knowledge, there is no litigation pending or threatened against or affecting the Fiscal Agent to restrain or enjoin the Fiscal Agent's participation in, or in any way contesting the powers of the Fiscal Agent with respect to the transactions contemplated by the Bonds, or the Fiscal Agent Agreement; (15) A certificate of the Fiscal Agent, dated the Closing Date, in form and substance acceptable to counsel for the Underwriter, to the following effect: (i) The Fiscal Agent is a national banking association, and is organized and existing under and by virtue of the laws of the United States of America, and has the full power and authority to accept and perform its duties under the Fiscal Agent Agreement, and the Continuing Disclosure Agreements; (ii) Subject to the provisions of the Fiscal Agent Agreement, the Fiscal Agent will apply the proceeds from the Bonds to the purposes specified in the Fiscal Agent Agreement; (iii) The Bonds have been duly and validly authenticated on behalf of Fiscal Agent; (iv) No consent, approval, authorization or other action by any governmental or regulatory authority having jurisdiction over the Fiscal Agent that has not been obtained is or will be required for the authentication of the Bonds or the consummation by the Fiscal Agent of the other transactions contemplated to be performed by the Fiscal Agent in connection with the authentication of the Bonds and the acceptance and performance of the obligations created by the Fiscal Agent Agreement; (v) There is no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, regulatory agency, public board or body pending or, to the best of its knowledge, threatened in any way affecting the existence of the Fiscal Agent, or seeking to restrain or to enjoin the execution and delivery of the Fiscal Agent Agreement, or the Continuing Disclosure Agreements, or the authentication of the Bonds, by the Fiscal Agent, or in any way contesting or affecting the validity or enforceability, as against the Fiscal Agent, of the Fiscal Agent Agreement, or the Continuing Disclosure Agreements or any action of the Fiscal Agent contemplated by any of said documents, or in which an adverse outcome would materially and adversely affect the ability of the Fiscal Agent to perform its obligations under the Fiscal Agent Agreement, or the Continuing Disclosure Agreements; (vi) The Fiscal Agent is not in breach of or in default under any applicable law or administrative rule or regulation of the State or the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Fiscal Agent is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the ability of the Fiscal 1 2 TEMCH BPAh.wpd/LR]424 Agent to perform its obligations under the Fiscal Agent Agreement, or the Continuing Disclosure Agreements; and (vii) The authentication of the Bonds, and the execution and delivery of the Fiscal Agent Agreement, and the Continuing Disclosure Agreements by the Fiscal Agent, and compliance with the provisions of each, will not conflict with or constitute a broach of or default under any applicable law or administrative rule or regulation of the State or the United States of America, or of any department, division, agency or instrumentality of either thereof, or under any applicable court or administrative decree or order, or under any loan agreement, note, ordinance, resolution, indenture, fiscal agent agreement, contract, agreement or other instrument to which the Fiscal Agent is a party or is otherwise subject or bound, a consequence of which could be to materially and adversely affect the ability of the Fiscal Agent to perform its obligations under the Fiscal Agent Agreement, or the Continuing Disclosure Agreements; (16) Certificates each dated the date of the Preliminary Official Statement each from Lennar Communities, KB Coastal and ?CC 11I, respectively, together with bring-down certificates dated the Closing Date in substantially the forms attached hereto as Exhibits B and C; (17) Good standing certificates for Lennar Communities, the Lennar Merchant Builders, KB Coastal and PCC III from appropriate officials of the Secretary of State of the State of California and from the Franchise Tax Board of the State of California; (18) Executed copies of the Continuing Disclosure Agreements (the "Continuing Disclosure Agreements") each dated as of June 1, 2003, and each by and among U.S. Bank National Association in its capacity as Fiscal Agent and Dissemination Agent and Lennar Homes, or KB Home Coastal, respectively, as applicable; (19) An opinion, dated the Closing Date, addressed to the Authority, the City and the Underwriter of and of Pillsbury Winthrop LLP, counsel to Lennar Communities in substantially the forms attached hereto as Exhibit D; (20) An opinion, dated the Closing Date, addressed to the Authority, the City and the Underwriter of Hewitt & O'Neil LLP, counsel to KB Home Coastal in substantially the form attached hereto as Exhibit D; (21) A certificate dated on or before the Closing Date of LENOne in substantially the form attached hereto as Exhibit E and a certificate dated on or before the Closing Date of the lenders to PCC III which have a loan secured by property within the District in substantially the form attached hereto as Exhibit E or other evidence provided by PCC 111 or a lender that there is no event of default under the loan agreement(s) at this time and acknowledging the priority position of the lien of Special Taxes relative to such lender's security for the loan; (22) An executed copy of the Escrow Agreement dated as of June 1,2003 by and between the Temecula Public Financing Authority and U.S. Bank National Association relating to Assessment District No. 159 of the County of Riverside Liens on property within the District; (23) A Certificate of the Escrow Agent, dated the Closing Date, addressed to the District and the Underwriter, in form and substance acceptable to the Underwriter to the following effect: 13 TEMCH BPAh.wpd/LR/424 (i) the Escrow Agent is duly organized and existing as a national banking association in good standing under the laws of the United States of America, having the full power and authority to accept and perform its duties under the Escrow Agreement; (ii) the Escrow Agent has duly authorized and executed the Escrow Agreement; and (iii) to the best of the knowledge of the Escrow Agent, the execution and delivery by the Escrow Agent of the Escrow Agreement and compliance with the terms thereof will not conflict with, or result in a violation or breach of, or constitute a default under, any loan agreement, resolution, bond, note, resolution or any other agreement or instrument to which the Escrow Agent is a party or by which it is bound, or any law or any rule, regulation, order or decree of any court or government agency or body having jurisdiction over the Escrow Agent or any of its activities or properties (except that no representation, warranty or agreement is made by the Escrow Agent with respect to any federal or state securities or "Blue Sky" laws or regulations), or (except with respect to the lien of the Escrow Agreement) result in the creation or imposition of any lien, charge or other security interest or encumbrance of any nature whatsoever upon any of the property or assets of the Escrow Agent; (24) A certificate from Albert A. Webb Associates to the effect that (i) if the Special Tax is levied in accordance with the terms as set forth in the Rate and Method of Apportionment of Special Tax of the District and collected, the amount of the levy will be sufficient to make timely payments of debt service and estimated annual administrative expenses on the Bonds, provided that acreage and number of units supplied by the District, by Lennar Communities, or by any of their agents, which has been relied upon by Albert A. Webb Associates is true and correct (no representation need be made as to the actual amounts that will be collected in future years), (ii) the amount of the maximum Special Taxes that may be levied in each Fiscal Year is at least 110% of the annual debt service for the Bonds for each such Fiscal Year, assuming that the net taxable acreage and projected development figures provided to Albert A. Webb Associates by Lennar Communities are true and correct, (iii) the description of the Rate and Method of Apportionment of the Special Taxes contained in the section captioned "SECURITY FOR THE 2003 BONDS - Special Taxes," and in Appendix B is correctly presented in ail material respects and (iv) that, as of the dates of the Preliminary Official Statement and the Official Statement the informati on contained in those portions of the Official Statement entitled "INTRODUCTION - The Community Facilities District," "INTRODUCTION - Soumes of Payment for the 2003 Bonds," "SECURITY FOR THE 2003 BONDS - Special Taxes," "SECURITY FOR THE 2003 BONDS - Rate and Method," "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property," "THE COMMUNITY FACILITIES DISTRICT - Direct and Overlapping Debt," "THE COMMUNITY FACILITIES DISTRICT - Overlapping Assessment and Community Facilities Districts," "COMMUNITY FACILITIES DISTRICT - Other Overlapping Direct Assessments," "THE COMMUNITY FACILITIES DISTRICT Estimated Assessed Value-to-Lien Ratios," "BONDOWNERS' RISKS - Levy and Collection of the Special Tax," "BONDOWNERS' RISKS - Exempt Properties," and in the Tables of the Official Statement captioned "Table - Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) Estimated Allocation of Special Taxes by Property Ownership" and "Table - Temecula Public Financing Authority Community Facilities District No. 03-1 Secured Property Tax Roll and Direct and Overlapping Debt" and "Appendix B" and the other data provided by the Special Tax Consultant and included in the Official Statement, do not, to my knowledge, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading; 14 TEMCH BPAh.wp6/LP,/424 (25) A conformed or certified copy of the Notice of Special Tax Lien recorded on April 4, 2003 as Document No. 2003-238653, with the County Recorder and a conformed or certified copy of the First Amended Notice of Special Tax Lien recorded on May __, 2003 as Document No. 2003- __, with the County Recorder; (26) Certified copies of proceedings relating to formation of the District, including a copy of the Procedural Resolutions and Ordinance No. TPFA 03-01 (Crowne Hill), adopted on April 8, 2003 levying the special taxes in accordance with the amended Rate and Method of Apportionment of Special Taxes; (27) Evidence that the federal tax information Form 8038-G has been prepared for filing; (28) Copies of filings with the California Debt and Investment Advisory Commission relating to the issuance of the Bonds; and (29) Such additional legal opinions, certificates, instruments and other documents as the Underwriter may reasonably request to evidence the truth and accuracy, as of the date hereof and as of the Closing Date, of the statements and information contained in the Preliminary Official Statement and the Official Statement, of the Authority's representations and warranties contained herein and the due performance or satisfaction by the Authority at or prior to the Closing Date of all agreements then to be performed and all conditions then to be satisfied by the Authority in connection with the transactions contemplated hereby and by the Procedural Resolutions and the Official Statement. (e) At the time of the Closing, no default shall have occurred or be existing under this Purchase Agreement, the Fiscal Agent Agreement or the District Documents and the Authority and the District shall not be in default in the payment of principal or interest on any of its bonded indebtedness which default shall adversely impact the ability of the Authority or the District to make payment on the Bonds. (f) If the Authority shall be unable to satisfy the conditions to the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds contained in this Bond Purchase Agreement, or if the obligations of the Underwriter to purchase, accept delivery of and pay for the Bonds shall be terminated for any reason permitted by this Bond Purchase Agreement, this Bond Purchase Agreement shall terminate and neither the Underwriter nor the Authority shall be under any further obligation hereunder, except that the respective obligations of the Authority and the Underwriter set forth and Section 4 hereof shall continue in full force and effect. 4. Expenses. Whether or not the Bonds are delivered to the Underwriter as set forth herein: (a) The Underwriter shall be under no obligation to pay, and the Authority shall pay or cause to be paid (out of any legally available funds of the Authority relating to the District) all expenses incident to the performance of the Authority's and the District's obligations hereunder, including, but not limited to, the cost of printing and delivering the Bonds to the Underwriter, the cost of preparation, printing (and/or word processing and reproduction), distribution and delivery of the Fiscal Agent Agreement, the Procedural Resolutions, the Ordinance, the Preliminary Official Statement, the Official Statement and all other agreements and documents contemplated hereby (and drafts of any thereof) in such reasonable quantities as requested by the Underwriter; the fees and expenses in connection with obtaining a delinquency report and statement of direct and overlapping bonded debt from Albert A. Webb Associates; and the fees 1 5 TEMCH BPAh.wpd/LR/424 and disbursements of the Fiscal Agent for the Bonds, Bond Counsel, Disclosure Counsel and any market absorption consultants, accountants, financial advisors, engineers or any other experts or consultants the Authority has retained in connection with the Bonds and any out-of-pocket disbursements of the Authority to be paid from the proceeds of the Bonds; and (b) The Authority shall be under no obligation to pay, and the Underwriter shall pay, the cost of preparation of any "Blue Sky" or legal investment memoranda; expenses to qualify the Bonds for sale under any "Blue Sky" or other state securities laws, the fees, if any, payable to the California Debt and Investment Advisory Commission on account of the Bonds; CUSIP Service Bureau fees; and all other expenses incurred by the Underwriter in connection with its public offering and distribution of the Bonds (except those specifically enumerated in paragraph (a) of this section), including any advertising expenses. 5. Notices. Any notice or other communication to be given to the Authority under this Bond Purchase Agreement may be given by delivering the same in writing to the Temecula Public Financing Authority, 43200 Business Park Drive, Temecula, California 92590 Attention: Director of Finance; and any notice or other communication to be given to the Underwriter under this Bond Purchase Agreement may be giyen by delivering the same in writing to Stone & Youngberg LLC, 515 South Figueroa Street, Suite 1060, Los Angeles, California 90071, Attention: Municipal Finance Department; provided, however, that all such notices, requests or other communications may be made by telephone and promptly confirmed by writing. The Authority and the Underwriter may, by notice given as aforesaid, specify a different address for any such notices, request or other communications. 6. Parties in Interest. This Bond Purchase Agreement is made solely for the benefit of the Authority and the Underwriter (including their successors or assigns), and no other person shall acquire or have any right hereunder or by virtue hereof. 7. Survival of Representations and Warranties. The representations and warranties of the Authority set forth in or made pursuant to this Bond Pumhase Agreement shall not be deemed to have been discharged, satisfied or otherwise rendered void by reason of the Closing or termination of this Bond Purchase Agreement and regardless of any investigations made by or on behalf of the Underwriter (or statements as to the results of such investigations) concerning such representations and statements of the Authority and regardless of delivery of and payment for the Bonds. 8. Effective. This Bond Purchase Agreement shall become effective and binding upon the respective parties hereto upon the execution of the acceptance hereof by the Authority and shall be valid and enforceable as of the time of such acceptance. 9. Applicable Law; Nonassi~;nability. This Bond Purchase Agreement shall be governed by the laws of the State. This Bond Purchase Agreement shall not be assigned by the Authority or the Underwriter. 10. Execution of Counterparts. This Bond Purchase Agreement may be executed in several counterparts, each of which shall be regarded as an original and all of which shall constitute one and the same. 11. No Prior Agreements. This Bond Purchase Agreement supersedes and replaces all prior negotiations, agreements and understandings between the parties hereto in relation to the sale of Bonds by the Authority and represents the entire agreement of the parties as to the subject matter herein. 12. Partial Unenforceability. Any provision of this Bond Purchase Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of 16 TEMCH BPAh.wpdtLR/424 such prohibition or unenforceability without invalidating the remaining provisions of this Bond Purchase Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 17 TEMCH BPAh.wpd/LR/424 13. Capitalized Terms. Terms with initial capital letters not otherwise defined herein shall have the meanings assigned to them in the Fiscal Agent Agreement or the Official Statement. Very truly yours, STONE & YOUNGBERG LLC By: ACCEPTED: June~ 2003 TEMECULA PUBLIC FINANCING AUTHORITY FOR AND ON BEHALF OF THE TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) By: TEMCH BPAh.wpd/LP~424 APPENDIX A TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS MATURITY SCHEDULE Maturity Date (September 1) Serial Bonds: 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Term Bonds: 2026 2033 Totallssue Principal lnterest Amount Rate Price The purchase price of the Bonds shall be $ (which is the principal amount thereof $ , less an original issue discount of $ ., and less the Underwfiter's discount of $ ). In addition, no accrued interest will be paid with respect to the Bonds because the Bonds are dated the closing date. A- ] TEMCH BPAh.wpd/LR/424 EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CERTIFICATE OF THE LENNAR ENTITIES To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill) Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds and to the Bond Purchase Agreement to be entered into in connection therewith (the "Bond Purchase Agreement"). This certificate is delivered pursuant to and in satisfaction of Section 3(d)(16) of the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of Lennar Homes of California, Inc., a California corporation CLennar Homes"), Lennar Communities, Inc., a California coxporation ("Lennar Communities"), Greystone Homes, Inc., a California corporation ("Greystone Homes") and U.S. Home, Inc., a California corporation ("U.S. Home") (collectively, the "Lennar Entities"), and the undersigned, on behalf of the Lennar Entities, further certifies as follows: 1. (i) Each of the Lennar Entities is duly organized and validly existing under the laws of the State of California, qualified to transact business in the State of California and has all requisite right, power and authority to execute and deliver this Certificate, and to undertake all of the transactions on its part described in the Preliminary Official Statement and contemplated by the Developer Continuing Disclosure Agreement and the Acquisition Agreement, dated as of March 1, 2003, executed by and between the Authority and Lennar Homes (the "Acquisition Agreement") and (ii) Lennar Homes has all requisite right, power and authority (x) to execute and deliver at Closing the Developer Continuing Disclosure Agreement (the "Developer Continuing Disclosure Agreement") dated as of June 1, 2003 by and between Lennar Homes and U.S. Bank National Association, as Dissemination Agent and Fiscal Agent; (y) to execute and deliver the Acquisition Agreement; (y) to execute and deliver the Joint Community Facilities Agreement -RCWD (the "Joint Community Facilities Agreement - RCWD"), dated as of March 1, 2003 by and among the Temecula Public Financing Authority, the Rancho California Water District ("RCWD') and Lennar Homes, and (z) to execute and deliver the Joint Community Facilities Agreement - EMWD (the "Joint Community Facilities Agreement - EMWD"), dated as of March 1, 2003 by and among the Temecula Public Financing Authority, Eastern Municipal Water District ("EMWD") and Lennar Homes (the Developer Continuing Disclosure Agreement, the Acquisition Agreement, the Joint Community Facilities Agreement - RCWD and the Joint B-I Community Facilities Agreement - EMWD are collectively referred to herein as the "Developer Agreements" and the Joint Community Facilities Agreement - RCWD and the Joint Community Facilities Agreement - EMWD are collectively referred to herein as the "Joint Community Facilities Agreements"). 2. As set forth in the Preliminary Official Statement, certain property within the District is held in the name of LENOne, Inc., a Virginia corporation ("LENOne") with whom the Lennar Entities have entered into various agreements pursuant to which the Lennar Entities will acquire and develop such property. In addition, as set forth in the Preliminary Official Statement, title to part of the property within the District is held in the name of PCC - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100"). Greystone Homes, is a member of PCC 100 and Greystone Homes will act as the merchant builder entitled to develop the lots owned by PCC 100. As set forth in the Preliminary Official Statement, [ 17/18] lots have been transferred by LENOne to Greystone Homes on December 20, 2002. The property owned by LENOne, PCC 100 and Greystone Homes is referred to herein as the "Property." The undersigned, on behalf of the Lennar Entities, makes the representations herein with respect to such Property. Except as otherwise described in the Preliminary Official Statement, the Lennar Entities are, and the Lennar Entities' current expectation is that the Lennar Entities shall remain the party responsible for land use planning and backbone infrastructure of the Property on behalf of the Lennar Entities. Except as otherwise described in the Preliminary Official Statement, none of the Lennar Entities have entered into an agreement for development or management of the Property by any entity other than as described in the Preliminary Official Statement. 3. Lennar Homes has, or will have prior to Closing, duly authorized the execution and delivery of the Acquisition Agreement and the Joint Community Facilities Agreements and has, or will have prior to the Closing, duly authorized execution and delivery at the Closing of the Developer Continuing Disclosure Agreement thereunder. Lennar Homes is duly authorized to perform the obligations on its part to be performed. Except as described in the Preliminary Official Statement with regard to previous undertakings relating to Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, the Lennar Entities are not aware of any material failures within the past five years by the Lennar Entities, their Affiliates or LENOne to provide periodic continuing disclosure reports or notices of material events with respect to community facilities districts or assessment districts in California. As described in the Preliminary Official Statement, Lennar Communities is reviewing and updating its system for filing reports and expects, to satisfy Lennar Communities' obligations, and Lennar Homes expects to satisfy its obligations, with regard to disclosure in the future. "Affiliate" of another Person (as defined below) means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by or under common control with such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies of a Person, unless such power is solely the result of an official position with such Person. "Person" means an individual, a corporation, a B-2 partnership, an association, a joint stock company, a trust, any unincorporated organization or a govemment or political subdivision thereof. 4. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of the undersigned, on behalf of the Lennar Entities (hereinafter "the actual knowledge of the Lennar Entities") (a) the Lennar Entities and their Affiliates are not in breach of or in default under any applicable law or administrative regulation of the State of California or the United States, or any agency or instrumentality of either, which breach or default would in any way materially and adversely affect the proposed Developer Continuing Disclosure Agreement, the Acquisition Agreement, the Joint Community Facilities Agreements, or the ability of the respective Lennar Entities to pay Special Taxes under the Option Agreements (as defined in the Preliminary Official Statement), (b) to the actual knowledge of the Lennar Entities, no event has occurred and is continuing which with the passage of time or giving of notice, or both, would constitute such a breach or default; and (c) to the actual knowledge of the Lennar Entities, the execution and delivery at Closing by Lennar Homes of the Developer Continuing Disclosure Agreement, and compliance with the provisions thereof and compliance with the provisions of the Acquisition Agreement and the Joint Community Facilities Agreements will not conflict with or constitute a breach of or default under any law or administrative regulation applicable to the Lennar Entities. 5. Except as disclosed in the Preliminary Official Statement, (a) to the actual knowledge of the Lennar Entities, the Lennar Entities and their Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which the Lennar Entities or their Affiliates are, or will upon issuance of the Bonds be, a party or otherwise subject, which breach or default would in any way materially and adversely affect the proposed Developer Continuing Disclosure Agreement, the Acquisition Agreement or the Joint Community Facilities Agreements, or the Lennar Entities ability to develop the Property or to pay the Special Taxes, (b) to the actual knowledge of the Lennar Entities, no event has occurred and is continuing that with the passage of time or giving of notice, or both, would constitute such a breach or default; and (c) to the actual knowledge of the Lennar Entities, the execution and delivery at Closing by Lennar Homes of the Developer Continuing Disclosure Agreement and compliance with the provisions thereof and of the Acquisition Agreement and the Joint Community Facilities Agreements will not conflict with or, constitute a breach of or default under any judgment, decree, loan agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which the Lennar Entities and their Affiliates are a party or otherwise subject which breach or default would in any way materially and adversely affect the Developer Continuing Disclosure Agreement, the Acquisition Agreement, the Joint Community Facilities Agreements or the Lennar Entities' ability to develop the Property or their ability to pay the Special Taxes. 6. Except as described in the Preliminary Official Statement, there are no material loans outstanding and unpaid and no material lines of credit of the Lennar Entities or their Affiliates that are secured by an interest in the Property. B-3 7. Except as set forth in the Preliminary Official Statement, no claim, dispute, suit, action, or contingent liability litigation is pending (with service of process to the Lennar Entities or any parent entity of any such entity, having been accomplished) or, to the actual knowledge of the Lennar Entities, threatened (a) to restrain or enjoin collection of Special Taxes or other sums pledged or to be pledged to pay the principal of and interest on the Bonds, (b) to restrain or enjoin the execution of and performance of Lennar Homes' obligations under the proposed Developer Continuing Disclosure Agreement, the Acquisition Agreement or the Joint Community Facilities Agreements, (c) to restrain or enjoin development of the Property, (d) in any way contesting or affecting the validity of the Special Taxes, the proposed Developer Continuing Disclosure Agreement, the Acquisition Agreement, the Joint Community Facilities Agreements or any other document, license, permit or approval necessary to the performance on the Lennar Entities' part under the proposed Developer Continuing Disclosure Agreement, the Acquisition Agreement or the Joint Community Facilities Agreements or (e) which would in any way materially and adversely affect the Lennar Entities' ability to develop the Property or to pay Special Taxes. 8. Except as set forth in the Preliminary Official Statement, no litigation is pending (with service of process to the Lennar Entities or any Affiliate having been accomplished), or, to the actual knowledge of the Lennar Entities, threatened against the Lennar Entities or any Affiliate involving the Lennar Entities or any Affiliate, or any of the property or assets under the control of the Lennar Entities or any Affiliate that involves the possibility of any judgment or uninsured liability which may result in any material adverse change in the assets or funds held by the Lennar Entities or any Affiliate that would materially and adversely affect the Lennar Entities' ability to develop the Property or to pay Special Taxes. 9. As of the date thereof, the Preliminary Official Statement, solely with respect to information contained therein with respect to the Lennar Entities, their Affiliates, and LENOne, the proposed development of the Property, ownership of the Property and the Lennar Entities' development plan, the Lennar Entities' financing plan, LENOne, and the Lennar Entities' lenders, if any, and contractual arrangements as set forth under the captions "INTRODUCTION - The Community Facilities District," "CONTINUING DISCLOSURE - Lennar Homes cmd KB Home Coastal," "THE COMMUNITY FACILITIES DISTRICT" (except the subcaption "-- Estimated Assessed Value-To-Lien Ratios") and "BONDOWNERS' RISKS - Endangered and Threatened Species" and "- Hazardous Substances" (excluding therefrom information which is identified to a source other than Lennar Homes, the Lennar Entities or LENOne and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to-Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ), is tree and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 10. The Lennar Entities have full power and authority to own and develop the Property and to carry on their business as presently conducted and as described in the Preliminary Official Statement. B-4 11. The Lennar Entities covenant that, while the Bonds or any refunding obligations related thereto are outstanding, the Lennar Entities and their Affiliates will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any corot, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of Ordinance No. TPFA 03-01 (Crowne Hill) of the Authority levying Special Taxes within the District, to invalidate the District or any of the Bonds, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notices of special tax lien relating thereto. The foregoing covenant shall not prevent the Lennar Entities in any way from bringing any other action, suit or proceeding including, without limitation, an action or suit contending that the Special Tax has not been levied in accordance with the methodologies contained in the District's Rate and Method of Apportionment of Special Taxes pursuant to which the Special Taxes are levied, an action or suit with respect to the application or use of the Special Taxes levied and collected, or an action or suit to enforce the obligations of the Authority under the Resolution of Issuance, the Fiscal Agent Agreement, the Acquisition Agreement, the Joint Community Facilities Agreements or any agreements between the Lennar Entities, the Authority, the City and/or the District. 12. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of the Lennar Entities after due inquiry, the Lennar Entities are not aware that any other public debt secured by a tax or assessment on the Property exists or is in the process of being authorized or any assessment districts or community facilities districts have been or are in the process of being formed that include any portion of the Property. 13. The Lennar Entities and their parent entities have not previously defaulted in payment of, and are not currently delinquent on, any ad valorem, assessment or special tax obligations in any jurisdiction in any material mount. 14. The Lennar Entities consent to the issuance of the Bonds. The Lennar Entities acknowledge and agree that the proceeds of the Bonds will be used as described in the Official Statement, provided that nothing in this statement modifies any right or obligation of the parties under the Acquisition Agreement or the Joint Community Facilities Agreements. 15. The Lennar Entities intend to comply with the provision of Government Code Section 53341.5 relating to the Notice of Special Tax in connection with the sale of the Property, or portions thereof. 16. The Lennar Entities acknowledge that interest on the Bonds is estimated to be capitalized through September l, 2003 and that the Special Tax levies on Developed Property will commence in Fiscal Year 2003-04 (commencing with the December 1, 2003 tax installment) in order to pay for interest on the Bonds and to pay a portion of the administrative expenses relating to the District. 17. The Lennar Entities are solvent and no proceedings are pending or, to the actual knowledge of the Lennar Entities after due inquiry, threatened in which the Lennar Entities may be adjudicated as bankrupt or discharged from any and all of their debts or obligations or granted an extension of time to pay their debts or obligations or a reorganization or readjustment B-5 of their debts or be subject to control or supervision of the Federal Deposit Insurance Corporation. 18. The parent entities of the Lennar Entities are solvent and no proceedings are pending, or to the actual knowledge of the Lennar Entities after due inquiry, threatened in which the parent entities of the Lennar Entities may be adjudicated as bankrupt or discharged from any or all of their respective debts or obligations, or granted an extension of time to pay their respective debt or obligations, or be allowed to reorganize or readjust their respective debts or obligations orbe subject to control or supervision of the Federal Deposit Insurance Corporation. 19. The Lennar Entities have not filed for, nor are the Lennar Entities aware of, current proceedings for the reassessment of the assessed value of the Property. 20. To the actual knowledge of the Lennar Entities after due inquiry, there are no claims, disputes, suits, actions or contingent liabilities among, by and between the Lennar Entities or its Affiliates and any contractors working on the development of the Property which may materially and adversely affect the development of the Property or the payment of the Special Taxes. 21. Based upon the current development plans, including, without limitation, the current budget and subject to economic conditions and risks generally inherent in the development of real property and the Lennar Entities presently anticipate that they will have sufficient funds to carry on their business as presently conducted and as described in the Preliminary Official Statement and to pay Special Taxes assessed against the Property and do not anticipate that the Authority or the District will be required to resort to a draw on the Reserve Fund for payment of principal of or interest on the Bonds due to the Lennar Entities' nonpayment of Special Taxes. However, none of the Lennar Entities or their Affiliates are obligated to make any additional capital contribution or loan to the Lennar Entities at any time and the Lennar Entities reserve the right to change their plan at any time without notice. 22. All information submitted in writing by, or on behalf of, the Lennar Entities to the Authority, the District, the Special Tax Consultant, Stephen G. White, MAI (the "Appraiser"), Disclosure Counsel or the Underwriter in connection with the issuance of the Bonds, was, at the time of submission, to the actual knowledge of the Lennar Entities after due inquiry, tree and correct. 23. As to information indicated in Section 9 hereof concerning the Lennar Entities their Affiliates and the development of the Property, and subject to the limitations and exclusions set forth in Section 9, the Lennar Entities agree to indemni~y and hold harmless, to the extent permitted by law, the Authority, the District, and their officials and employees, and each person, if any, who controls any of the foregoing within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended against any and all losses, claims, damages or liabilities, joint or several, to which such indemnified party may become subject under any statute or at law or in equity or otherwise, and shall reimburse any such indemnified party for any reasonable legal or other expense incurred by it in connection with investigating any claims against it and defending any actions, insofar as such losses, claims, damages, liabilities or actions arise out of or are based B-6 upon any untrue statement of a material fact or the omission to state, in the final Official Statement, as of its date or in any continuing disclosure statement provided by or on behalf of the Lennar Entities or LENOne, a material fact necessary to make the statement therein, in light of the circumstances under which it was made not misleading. This indemnity provision shall not be construed as a limitation on any other liability which the Lennar Entities may otherwise have to any indemnified party, provided that in no event shall the Lennar Entities be obligated for double indemnification. 24. Lennar Homes has agreed to execute the Developer's Continuing Disclosure Agreement in the form included in Appendix G to the Preliminary Official Statement. 25. If between the date hereof and the date of the Closing any event relating to or affecting the Lennar Entities, their Affiliates, LENOne or the development of the Property shall occur of which the Lennar Entities have actual knowledge which might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, the Lennar Entities shall notify the Authority, the District and the Underwriter and if in the opinion of counsel to the Authority or the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, the Lennar Entities shall cooperate with the Authority in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to counsel to the Authority and to the Underwriter. 26. For the "underwriting period," as defined in the Bond Purchase Agreement, if any event relating to or affecting the Lennar Entities, their Affiliates, LENOne or the development of the Property shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the Authority, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, the Lennar Entities shall cooperate with the Authority and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to the Underwriter and counsel to the Authority which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading. 27. The Lennar Entities agree to deliver a Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds in substantially the form attached as Exhibit A. 28. On behalf of the Lennar Entities, I have reviewed the contents of this Certificate and have met with counsel to the Lennar Entities, for the purpose of discussing the meaning of its contents. DATED: May ,2003 B-7 By: As of LENNAR COMMUNITIES, 1NC., a California corporation As of LENNAR HOMES Of CALIFORNIA, INC., a California corporation, As of GREYSTONE HOMES, INC., a California corporation As corporation of U.S. HONE INC., a California B-8 EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CERTIFICATE OF PCC III To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds and to the Bond Purchase Agreement to be entered into in connection therewith (the "Bond Purchase Agreement"). This certificate is delivered pursuant to and in satisfaction of Section 3(d)(16) of the Bond Pumhase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Pumhase Agreement. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of Pacific Century Homes, Inc., a California corporation ("Pacific Century Homes") as the Administrative Member of PCC III - Crowne Hill LLC, a Delaware limited liability company ("PCC III"), and the undersigned, on behalf of PCC III, further certifies as follows: 1. PCC III is duly organized and validly existing under the laws of the State of Delaware, qualified to transact business in the State of California and has all requisite right, power and authority to execute and deliver this Certificate, and to undertake all of the transactions on its part described in the Preliminary Official Statement 2. As set forth in the Preliminary Official Statement, title to part of the property within the District is held in the name of PCC III. Pacific Century Homes is a member of PCC II1, and Pacific Century will act as the merchant builder entitled to develop the lots owned by PCC llI or will act as developer with respect to the sale of lots to builders or homeowners for construction of homes. The property owned by PCC III is referred to herein as the "Property." The undersigned, on behalfofPCC III, makes the representations herein with respect to such Property. Except as otherwise described in the Preliminary Official Statement, PCC 1II current expectation is that the Lennar Entities shall remain the party responsible for land use planning and backbone infrastructure of the Property on behalf of PCC III. Except as otherwise described in the Preliminary Official Statement PCC III has not entered into an agreement for development or management of the Property by any entity other than Pacific Century Homes as described in the Preliminary Official Statement. 3. Except as described in the Preliminary Official Statement, PCC III and its Affiliates have not previously failed to comply with any obligations imposed upon it under B-I Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. "Affiliate" of another Person (as defined below) means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by or under common control with such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies ora Person, unless such power is solely the result of an official position with such Person. "Person" means an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof. 4. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of the undersigned, on behalf of PCC III (hereinafter "the actual knowledge of PCC III") (a) PCC 1II and its Affiliates are not in breach of or in default under any applicable law or administrative regulation of the State of California or the United States, or any agency or instrumentality of either, which breach or default would in any way materially and adversely affect the ability of PCC II1 to pay Special Taxes due with respect to the Property, (b) to the actual knowledge of PCC III, no event has occurred and is continuing which with the passage of time or giving of notice, or both, would constitute such a breach or default. 5. Except as disclosed in the Preliminary Official Statement, (a) to the actual knowledge of PCC III, PCC IIl and its Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which PCC III or its Affiliates are, or will upon issuance of the Bonds be, a party or otherwise subject, which breach or default would in any way materially and adversely affect PCC III's ability to develop the Property or to pay the Special Taxes, and (b) to the actual knowledge of PCC III, no event has occurred and is continuing that with the passage of time or giving of notice, or both, would constitute such a breach or default. 6. Except as described in the Preliminary Official Statement, there are no material loans outstanding and unpaid and no material lines of credit of PCC III that are secured by an interest in the Property. 7. Except as set forth in the Preliminary Official Statement, no claim, dispute, suit, action, or contingent liability litigation is pending (with service of process to PCC III or any Affiliate of PCC III, having been accomplished) or, to the actual knowledge of PCC III, threatened (a) to restrain or enjoin collection of Special Taxes or other sums pledged or to be pledged to pay the principal of and interest on the Bonds, (b) to restrain or enjoin development of the Property, (c) in any way contesting or affecting the validity of the Special Taxes or (d) which would in any way materially and adversely affect PCC llI's ability to develop the Property or to pay Special Taxes. B-2 8. Except as set forth in the Preliminary Official Statement, no litigation is pending (with service of process to PCC III having been accomplished), or, to the actual knowledge of PCC III, threatened against PCC III or any Affiliate involving PCC II1, or any of the property or assets under the control of PCC III or any Affiliate that involves the possibility of any judgment or uninsured liability which may result in any material adverse change in the assets or funds held by PCC III that would materially and adversely affect PCC IIl's ability to develop the Property or to pay Special Taxes. 9. As of the date thereof, the Preliminary Official Statement, solely with respect to information contained therein with respect to PCC III and its Affiliates, the proposed development of the Property, ownership of the Property, PCC III's development plan, PCC llI's financing plan, and PCC III's lenders, if any, and contractual arrangements as set forth under the captions "INTRODUCTION - The Community Facilities District," "THE COMMUNITY FACILITIES DISTRICT" (except the subcaption "- Estimated Assessed Value-To-Lien Ratios") and "BONDOWNERS' RISKS - Endangered and Threatened Species" and "- Hazardous Substances" (excluding therefrom information which is identified to a source other than PCC III and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to- Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ), is true and correct in all material respects and did not contain any untrue statement ora material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 10. PCC III has full power and authority to own and develop the Property and to carry on its business as presently conducted and as described in the Preliminary Official Statement. 11. PCC III covenants that, while the Bonds or any refunding obligations related thereto are outstanding, PCC III and its Affiliates will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of Ordinance No. TPFA 03-01 (Crowne Hill) of the Authority levying Special Taxes within the District, to invalidate the District or any of the Bonds, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notices of special tax lien relating thereto. The foregoing covenant shall not prevent PCC III in any way from bringing any other action, suit or proceeding including, without limitation, an action or suit contending that the Special Tax has not been levied in accordance with the methodologies contained in the District's Rate and Method of Apportionment of Special Taxes pursuant to which the Special Taxes are levied, an action or suit with respect to the application or use of the Special Taxes levied and collected, or an action or suit to enforce the obligations of the Authority under the Resolution of Issuance, the Fiscal Agent Agreement or any agreements between the Authority, the City and/or the District. B-3 12. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of PCC III after due inquiry, PCC III is not aware that any other public debt secured by a tax or assessment on the Property exists or is in the process of being authorized or any assessment districts or community facilities districts have been or are in the process of being formed that include any portion of the Property. 13. PCC Ill and its Affiliates have not previously defaulted in payment of, or are currently delinquent on, any ad valorem, assessment or special tax obligations in any jurisdiction in any material amount. 14. PCC III consents to the issuance of the Bonds. PCC III acknowledges and agrees that the proceeds of the Bonds will be used as described in the Official Statement. 15. PCC III intends to comply with the provision of Government Code Section 53341.5 relating to the Notice of Special Tax in connection with the sale of the Property, or portions thereof. 16. PCC 1II acknowledges that interest on the Bonds is estimated to be capitalized through September 1, 2003 and that the Special Tax levies on Developed Property will commence in Fiscal Year 2003-04 (commencing with the December 1,2003 tax installment) in order to pay for interest on the Bonds and to pay a portion of the administrative expenses relating to the District. 17. PCC III is solvent and no proceedings are pending or, to the actual knowledge of PCC Ill after due inquiry, threatened in which PCC III may be adjudicated as bankrupt or discharged from any and all of its debts or obligations or granted an extension of time to pay its debts or obligations or a reorganization or readjustment of its debts or be subject to control or supervision of the Federal Deposit Insurance Corporation. 18. The members of PCC III are solvent and no proceedings are pending, or to the actual knowledge of PCC III after due inquiry, threatened in which the members of PCC III, may be adjudicated as bankrupt or discharged from any or all of its respective debts or obligations, or granted an extension of time to pay its respective debt or obligations, or be allowed to reorganize or readjust its respective debts or obligations or be subject to control or supervision of the Federal Deposit Insurance Corporation. 19. PCC III has not filed for, nor is PCC Ill aware of, current proceedings for the reassessment of the assessed value of the Property. 20. To the actual knowledge of PCC III after due inquiry, there are no claims, disputes, suits, actions or contingent liabilities among, by and between PCC III, its Affiliates and any contractors working on the development of the Property which may materially and adversely affect the development of the Property or the payment of the Special Taxes. 21. Based upon the current development plans, including, without limitation, the current budget and subject to economic conditions and risks generally inherent in the development of real property, PCC III presently anticipates that it will have sufficient funds B-4 to carry on its business as presently conducted and as described in the Preliminary Official Statement and to pay Special Taxes assessed against the Property and do not anticipate that the Authority or the District will be required to resort to a draw on the Reserve Fund for payment of principal of or interest on the Bonds due to PCC III's nonpayment of Special Taxes. However, PCC III and its Affiliates are not obligated to make any additional capital contribution or loan to PCC III at any time and PCC III reserves the right to change its plan at any time without notice. 22. All information submitted in writing by, or on behalf of, PCC III to the Authority, the District, the Special Tax Consultant, Stephen G. White, MAI (the "Appraiser"), Disclosure Counsel or the Underwriter in connection with the issuance of the Bonds, was, at the time of submission, to the actual knowledge of PCC 11I after due inquiry, true and correct. 23. As to information indicated in Section 9 hereof concerning PCC III and its Affiliates and the development of the Property, and subject to the limitations and exclusions set forth in Section 9, PCC III agrees to indemnify and hold harmless, to the extent permitted by law, the Authority, the District, and its officials and employees, and each person, if any, who controls any of the foregoing within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended against any and all losses, claims, damages or liabilities, joint or several, to which such indemnified party may become subject under any statute or at law or in equity or otherwise, and shall reimburse any such indemnified party for any reasonable legal or other expense incurred by it in connection with investigating any claims against it and defending any actions, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement of a material fact or the omission to state, in the final Official Statement, as of its date or in any continuing disclosure statement provided by or on behalf of PCC III, a material fact necessary to make the statement therein, in light of the circumstances under which it was made not misleading. This indemnity provision shall not be construed as a limitation on any other liability which PCC III may otherwise have to any indemnified party, provided that in no event shall PCC Ili be obligated for double indemnification. 24. If between the date hereof and the date of the Closing any event relating to or affecting PCC III, its Affiliates or the development of the Property shall occur of which PCC III has actual knowledge which might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, PCC III shall notify the Authority, the District and the Underwriter and if in the opinion of counsel to the Authority or the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, PCC III shall cooperate with the Authority in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to counsel to the Authority and to the Underwriter. 25. For the "underwriting period," as defined in the Bond Purchase Agreement, if any event relating to or affecting the PCC III, its Affiliates or the development of the B-5 Property shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the Authority, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the cimumstances existing at the time it is delivered to a purchaser, PCC III shall cooperate with the Authority and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to the Underwriter and counsel to the Authority which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading. 26. PCC III agrees to deliver a Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds in substantially the form attached as Exhibit A. 27. On behalf of PCC II1, I have reviewed the contents of this Certificate and have met with counsel to PCC III, for the purpose of discussing the meaning of its contents. DATED: May ,2003 PCC III - CROWNE HILL LLC, a Delaware limited liability company By: PACIFIC CENTURY HOMES, INC, a California corporation its Administrative Member By: Name: Title: B-6 EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CERTIFICATE OF PCC 100 To' Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds and to the Bond Purchase Agreement to be entered into in connection therewith (the "Bond Purchase Agreement"). This certificate is delivered pursuant to and in satisfaction of Section 3(d)(16) of the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of Greystone Homes as the Administrative Member of PCC III - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100"), and the undersigned, on behalf of PCC 100, further certifies as follows: 1. PCC 100 is duly organized and validly existing under the laws of the State of Delaware, qualified to transact business in the State of California and has all requisite right, power and authority to execute and deliver this Certificate, and to undertake all of the transactions on its part described in the Preliminary Official Statement 2. As set forth in the Preliminary Official Statement, title to part of the property within the District is held in the name of PCC 100. Greystone Homes is a member of PCC 100, and Greystone Homes will act as the merchant builder entitled to develop the lots owned by PCC 100. The property owned by PCC 100 is referred to herein as the "Property." The undersigned, on behalf of PCC 100, makes the representations herein with respect to such Property. Except as otherwise described in the Preliminary Official Statement, PCC 100 current expectation is that the Lennar Entities shall remain the party responsible for land use planning and backbone infrastructure of the Property on behalf of PCC 100. Except as otherwise described in the Preliminary Official Statement PCC 100 has not entered into an agreement for development or management of the Property by any entity other than Greystone Homes as described in the Preliminary Official Statement. 3. Except as described in the Preliminary Official Statement, PCC 100 and its Affiliates have not previously failed to comply with any obligations imposed upon it under Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. "Affiliate" of another Person (as defined below) means (a) a B-1 Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or mom of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by or under common control with such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies ora Person, unless such power is solely the result of an official position with such Person. "Person" means an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof. 4. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of the undersigned, on behalf of PCC 100 (hereinafter "the actual knowledge of PCC 100") (a) PCC 100 and its Affiliates are not in breach of or in default under any applicable law or administrative regulation of the State of California or the United States, or any agency or instrumentality of either, which breach or default would in any way materially and adversely affect the ability ofPCC 100 to pay Special Taxes due with respect to the Property, (b) to the actual knowledge of PCC 100, no event has occurred and is continuing which with the passage of time or giving of notice, or both, would constitute such a breach or default. 5. Except as disclosed in the Preliminary Official Statement, (a) to the actual knowledge of PCC 100, PCC 100 and its Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which PCC 100 or its Affiliates are, or will upon issuance of the Bonds be, a party or otherwise subject, which breach or default would in any way materially and adversely affect PCC 100's ability to develop the Property or to pay the Special Taxes, and (b) to the actual knowledge of PCC 100, no event has occurred and is continuing that with the passage of time or giving of notice, or both, would constitute such a breach or default. 6. Except as described in the Preliminary Official Statement, there are no material loans outstanding and unpaid and no material lines of credit of PCC 100 that are secured by an interest in the Property. 7. Except as set forth in the Preliminary Official Statement, no claim, dispute, suit, action, or contingent liability litigation is pending (with service of process to PCC 100 or any Affiliate ofPCC 100, having been accomplished) or, to the actual knowledge of PCC 100, threatened (a) to restrain or enjoin collection of Special Taxes or other sums pledged or to be pledged to pay the principal of and interest on the Bonds, (b) to restrain or enjoin development of the Property, (c) in any way contesting or affecting the validity of the Special Taxes or (d) which would in any way materially and adversely affect PCC 100's ability to develop the Property or to pay Special Taxes. 8. Except as set forth in the Preliminary Official Statement, no litigation is pending (with service of process to PCC 100 having been accomplished), or, to the actual knowledge ofPCC 100, threatened against PCC 100 or any Affiliate involving PCC 100, or B-2 any of the property or assets under the control ofPCC 100 or any Affiliate that involves the . possibility of any judgment or uninsured liability which may result in any material adverse change in the assets or funds held by PCC 100 that would materially and adversely affect PCC 100's ability to develop the Property or to pay Special Taxes. 9. As of the date thereof, the Preliminary Official Statement, solely with respect to information contained therein with respect to PCC 100 and its Affiliates, the proposed development of the Property, ownership of the Property, PCC 100's development plan, PCC 100's financing plan, and PCC 100's lenders, if any, and contractual arrangements as set forth under the captions "INTRODUCTION - The Community Facilities District," "THE COMMUNITY FACILITIES DISTRICT" (except the subcaption "- Estimated Assessed Value-To-Lien Ratios") and "BONDOWNERS' RISKS - Endangered and Threatened Species" and "- Hazardous Substances" (excluding therefrom information which is identified to a source other than PCC 100 and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to- Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ), is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 10. PCC 100 has full power and authority to own and develop the Property and to carry on its business as presently conducted and as described in the Preliminary Official Statement. 11. PCC 100 covenants that, while the Bonds or any refunding obligations related thereto are outstanding, PCC 100 and its Affiliates will not bring any action, suit, proceeding,'inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of Ordinance No. TPFA 03-01 (Crowne Hill) of the Authority levying Special Taxes within the District, to invalidate the District or any of the Bonds, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notices of special tax lien relating thereto. The foregoing covenant shall not prevent PCC 100 in any way from bringing any other action, suit or proceeding including, without limitation, an action or suit contending that the Special Tax has not been levied in accordance with the methodologies contained in the District's Rate and Method of Apportionment of Special Taxes pursuant to which the Special Taxes are levied, an action or suit with respect to the application or use of the Special Taxes levied and collected, or an action or suit to enforce the obligations of the Authority under the Resolution of Issuance, the Fiscal Agent Agreement or any agreements between the Authority, the City and/or the District. 12. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of PCC 100 after due inquiry, PCC 100 is not aware that any other public debt secured by a tax or assessment on the Property exists or is in the process of being authorized B-3 or any assessment districts or community facilities districts have been or are in the process of being formed that include any portion of the Property. 13. PCC 100 and its Affiliates have not previously defaulted in payment of, or are currently delinquent on, any ad valorem, assessment or special tax obligations in any jurisdiction in any material amount. 14. PCC 100 consents to the issuance of the Bonds. PCC 100 acknowledges and agrees that the proceeds of the Bonds will be used as described in the Official Statement. 15. PCC 100 intends to comply with the provision of Government Code Section 53341.5 relating to the Notice of Special Tax in connection with the sale of the Property, or portions thereof. 16. PCC 100 acknowledges that interest on the Bonds is estimated to be capitalized through September 1, 2003 and that the Special Tax levies on Developed Property will commence in Fiscal Year 2003-04 (commencing with the December 1,2003 tax installment) in order to pay for interest on the Bonds and to pay a portion of the administrative expenses relating to the District. 17. PCC 100 is solvent and no proceedings are pending or, to the actual knowledge of PCC 100 after due inquiry, threatened in which PCC 100 may be adjudicated as bankrupt or discharged from any and all of its debts or obligations or granted an extension of time to pay its debts or obligations or a reorganization or readjustment of its debts or be subject to control or supervision of the Federal Deposit Insurance Corporation. 18. The members of PCC 100 are solvent and no proceedings are pending, or to the actual knowledge ofPCC 100 after due inquiry, threatened in which the members of PCC 100, may be adjudicated as bankrupt or discharged from any or all of its respective debts or obligations, or granted an extension of time to pay its respective debt or obligations, or be allowed to reorganize or readjust its respective debts or obligations or be subject to control or supervision of the Federal Deposit Insurance Corporation. 19. ?CC 100 has not filed for, nor is PCC 100 aware of, current proceedings for the reassessment of the assessed value of the Property. 20. To the actual knowledge of PCC 100 after due inquiry, there are no claims, disputes, suits, actions or contingent liabilities among, by and between PCC 100, its Affiliates and any contractors working on the development of the Property which may materially and adversely affect the development of the Property or the payment of the Special Taxes. 21. Based upon the current development plans, including, without limitation, the current budget and subject to economic conditions and risks generally inherent in the development of real property, PCC 100 presently anticipates that it will have sufficient funds to carry on its business as presently conducted and as described in the Preliminary Official Statement and to pay Special Taxes assessed against the Property and do not anticipate that B-4 the Authority or the District will be required to resort to a draw on the Reserve Fund for payment of principal of or interest on the Bonds due to PCC 100's nonpayment of Special Taxes. However, PCC 100 and its Affiliates are not obligated to make any additional capital contribution or loan to PCC 100 at any time and PCC 100 reserves the right to change its plan at any time without notice. 22. All information submitted in writing by, or on behalf of, PCC 100 to the Authority, the District, the Special Tax Consultant, Stephen G. White, MAI (the "Appraiser"), Disclosure Counsel or the Underwriter in connection with the issuance of the Bonds, was, at the time of submission, to the actual knowledge ofPCC 100 after due inquiry, true and correct. 23. As to information indicated in Section 9 hereof concerning PCC 100 and its Affiliates and the development of the Property, and subject to the limitations and exclusions set forth in Section 9, PCC 100 agrees to indemnify and hold harmless, to the extent permitted by law, the Authority, the District, and its officials and employees, and each person, if any, who controls any of the foregoing within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended against any and all losses, claims, damages or liabilities, joint or several, to which such indemnified party may become subject under any statute or at law or in equity or otherwise, and shall reimburse any such indemnified party for any reasonable legal or other expense incurred by it in connection with investigating any claims against it and defending any actions, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement ora material fact or the omission to state, in the final Official Statement, as of its date or in any continuing disclosure statement provided by or on behalfofPCC 100, a material fact necessary to make the statement therein, in light of the circumstances under which it was made not misleading. This indemnity provision shall not be construed as a limitation on any other liability which PCC 100 may otherwise have to any indemnified party, provided that in no event shall PCC 100 be obligated for double indemnification. 24. If between the date hereof and the date of the Closing any event relating to or affecting PCC 100, its Affiliates or the development of the Property shall occur of which PCC 100 has actual knowledge which might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, PCC 100 shall notify the Authority, the District and the Underwriter and if in the opinion of counsel to the Authority or the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, PCC 100 shall cooperate with the Authority in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to counsel to the Authority and to the Underwriter. 25. For the "underwriting period," as defined in the Bond Purchase Agreement, if any event relating to or affecting the PCC 100, its Affiliates or the development of the Property shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the Authority, to amend or supplement the Official Statement in order to make B-5 the Official Statement not misleading in the light of the cimumstances existing at the time it is delivered to a purchaser, PCC 100 shall cooperate with the Authority and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to the Underwriter and counsel to the Authority which will amend or supplement the Official Statement so that it will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading. 26. PCC 100 agrees to deliver a Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds in substantially the form attached as Exhibit A. 27. On behalf of PCC 100, I have reviewed the contents of this Certificate and have met with counsel to PCC 100, for the purpose of discussing the meaning of its contents. DATED: May ,2003 PCC III - CROWNE HILL 100, LLC, a Delaware limited liability company By: GREYSTONE HOMES, 1NC., a California corporation its Administrative Member By: Name: Title: B-6 EXHIBIT B TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CERTIFICATE OF KB HOMES COASTAL To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds and to the Bond Pumhase Agreement to be entered into in connection therewith (the "Bond Pumhase Agreement"). This certificate is delivered pursuant to and in satisfaction of Section 3(d)(l 6) of the Bond Pumhase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Pumhase Agreement. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of KB Homes Coastal, Inc., a California corporation ("KB Homes Coastal"), and the undersigned, on behalf of KB Homes Coastal, further certifies as follows: 1. (i) KB Homes Coastal is duly organized and validly existing under the laws of the State of California, qualified to transact business in the State of California and has all requisite right, power and authority to execute and deliver this Certificate, and to undertake all of the transactions on its part described in the Preliminary Official Statement and contemplated by the Developer Continuing Disclosure Agreement and (ii) KB Homes Coastal has all requisite right, power and authority (x) to execute and deliver at Closing the Developer Continuing Disclosure Agreement (the "Developer Continuing Disclosure Agreement") dated as of June 1, 2003 by and between KB Homes Coastal and U.S. Bank National Association, as Dissemination Agent and Fiscal Agent. 2. As set forth in the Preliminary Official Statement, certain property within the District is held in the name of KB Homes Coastal (herein the "Property"). The undersigned, on behalf of KB Homes Coastal, makes the representations herein with respect to such Property. Except as otherwise described in the Preliminary Official Statement, KB Homes Coastal is, and KB Homes Coastal's current expectation is that KB Homes Coastal shall remain the party responsible for land use planning and backbone infrastructure of the Property on behalf of KB Homes Coastal. Except as otherwise described in the Preliminary Official Statement, KB Homes Coastal has not entered into an agreement for development or management of the Property by any entity other than as described in the Preliminary Official Statement. B-1 3. KB Homes Coastal has, or will have prior to the Closing, duly authorized execution and delivery at the Closing of the Developer Continuing Disclosure Agreement thereunder. KB Homes Coastal is duly authorized to perform the obligations on its part to be performed. Except as described in the Preliminary Official Statement with regard to previous undertakings relating to Rule 15c2-12 of the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, KB Homes Coastal is not aware of any material failures within the past five years by KB Homes Coastal, or its Affiliates to provide periodic continuing disclosure reports or notices of material events with respect to community facilities districts or assessment districts in California. "Affiliate" of another Person (as defined below) means (a) a Person directly or indirectly owning, controlling, or holding with power to vote, 15% or more of the outstanding voting securities of such other Person, (b) any Person 15% or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person, and (c) any Person directly or indirectly controlling, controlled by or under common control with such other Person; for purposes hereof, control means the power to exercise a controlling influence over the management or policies of a Person, unless such power is solely the result of an official position with such Person. "Person" means an individual, a corporation, a partnership, an association, a joint stock company, a trust, any unincorporated organization or a government or political subdivision thereof. 4. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of the undersigned, on behalf of KB Homes Coastal (hereinafter "the actual knowledge of KB Homes Coastal") (a) KB Homes Coastal and its Affiliates are not in breach of or in default under any applicable law or administrative regulation of the State of California or the United States, or any agency or instrumentality of either, which breach or default would in any way materially and adversely affect the proposed Developer Continuing Disclosure Agreement, or the ability of KB Home Coastal to pay Special Taxes, (b) to the actual knowledge of KB Homes Coastal, no event has occurred and is continuing which with the passage of time or giving of notice, or both, would constitute such a breach or default; and (c) to the actual knowledge of KB Homes Coastal, the execution and delivery at Closing by KB Homes Coastal of the Developer Continuing Disclosure Agreement, and compliance with the provisions thereof will not conflict with or constitute a breach of or default under any law or administrative regulation applicable to KB Homes Coastal. 5. Except as disclosed in the Preliminary Official Statement, (a) to the actual knowledge of KB Homes Coastal, KB Homes Coastal and its Affiliates are not in breach of or in default under any applicable judgment or decree or any loan agreement, option agreement, development agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which KB Homes Coastal or its Affiliates are, or will upon issuance of the Bonds be, a party or otherwise subject, which breach or default would in any way materially and adversely affect the proposed Developer Continuing Disclosure Agreement, or KB Homes Coastal ability to develop the Property or to pay the Special Taxes, (b) to the actual knowledge of KB Homes Coastal, no event has occurred and is continuing that with the passage of time or giving of notice, or both, would constitute such a breach or default; and (c) to the actual knowledge of KB Homes Coastal, the execution and delivery at Closing by KB Homes Coastal of the Developer Continuing Disclosure Agreement and compliance with the provisions thereof will not conflict with or, constitute a breach of or B-2 default under any judgment, decree, loan agreement, indenture, fiscal agent agreement, bond, note, resolution, agreement or other instrument to which KB Homes Coastal and its Affiliates are a party or otherwise subject which breach or default would in any way materially and adversely affect the Developer Continuing Disclosure Agreement, or KB Homes Coastal's ability to develop the Property or its ability to pay the Special Taxes. 6. Except as described in the Preliminat~y Official Statement, there are no material loans outstanding and unpaid and no material lines of credit of KB Homes Coastal or its Affiliates that are secured by an interest in the Property. 7. Except as set forth in the Preliminary Official Statement, no claim, dispute, suit, action, or contingent liability litigation is pending (with service of process to KB Homes Coastal or any parent entity of any such entity, having been accomplished) or, to the actual knowledge of KB Homes Coastal, threatened (a) to restrain or enjoin collection of Special Taxes or other sums pledged or to be pledged to pay the principal of and interest on the Bonds, (b) to restrain or enjoin the execution of and performance of KB Homes Coastal's obligations under the proposed Developer Continuing Disclosure Agreement,, (c) to restrain or enjoin development of the Property, (d) in any way contesting or affecting the validity of the Special Taxes, the proposed Developer Continuing Disclosure Agreement, or any other document, license, permit or approval necessary to the performance on KB Homes Coastal's part under the proposed Developer Continuing Disclosure Agreement, or (e) which would in any way materially and adversely affect KB Homes Coastal's ability to develop the Property or to pay Special Taxes. 8. Except as set forth in the Preliminary Official Statement, no litigation is pending (with service of process to KB Homes Coastal or any Affiliate having been accomplished), or, to the actual knowledge of KB Homes Coastal, threatened against KB Homes Coastal or any Affiliate involving KB Homes Coastal or any Affiliate, or any of the property or assets under the control of KB Homes Coastal or any Affiliate that involves the possibility of any judgment or uninsured liability which may result in any material adverse change in the assets or funds held by KB Homes Coastal or any Affiliate that would materially and adversely affect KB Homes Coastal's ability to develop the Property or to pay Special Taxes. 9. As of the date thereof, the Preliminary Official Statement, solely with respect to information contained therein with respect to KB Homes Coastal and its Affiliates, the proposed development of the Property, ownership of the Property and KB Homes Coastal's development plan, KB Homes Coastal's financing plan, and KB Homes Coastal's lenders, if any, and contractual arrangements as set forth under the captions "INTRODUCTION - The Community Facilities District," "CONTINUING DISCLOSURE - LennarHomes andKBHome Coastal," "THE COMMUNITY FACILITIES DISTRICT" (except the subcaption"- Estimated Assessed Value-To-Lien Ratios") and "BONDOWNERS' RISKS - Endangered and Threatened Species" and" - Hazardous Substances" (excluding therefrom information which is identified to a source other than KB Homes Coastal, and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to-Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ), is true and correct in all material respects and did not contain any untrue statement of a material fact or omit to B-3 state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. 10. KB Homes Coastal has full power and authority to own and develop the Property and to carry on its business as presently conducted and as described in the Preliminary Official Statement. 11. KB Homes Coastal covenant that, while the Bonds or any refunding obligations related thereto are outstanding, KB Homes Coastal and its Affiliates will not bring any action, suit, proceeding, inquiry or investigation at law or in equity, before any court, regulatory agency, public board or body, that in any way seeks to challenge or overturn the formation of the District, to challenge the adoption of Ordinance No. TPFA 03-01 (Crowne Hill) of the Authority levying Special Taxes within the District, to invalidate the District or any of the Bonds, or to invalidate the special tax liens imposed under Section 3115.5 of the Streets and Highways Code based on recordation of the notices of special tax lien relating thereto. The foregoing covenant shall not prevent KB Homes Coastal in any way from bringing any other action, suit or proceeding including, without limitation, an action or suit contending that the Special Tax has not been levi ed in accordance with the methodologies contained in the District's Rate and Method of Apportionment of Special Taxes pursuant to which the Special Taxes are levied, an action or suit with respect to the application or use of the Special Taxes levied and collected, or an action or suit to enforce the obligations of the Authority under the Resolution of Issuance, the Fiscal Agent Agreement, or any agreements between KB Homes Coastal, the Authority, the City and/or the District. 12. Except as disclosed in the Preliminary Official Statement, to the actual knowledge of KB Homes Coastal after due inquiry, KB Homes Coastal is not aware that any other public debt secured by a tax or assessment on the Property exists or is in the process of being authorized or any assessment districts or community facilities districts have been or are in the process of being formed that include any portion of the Property. 13. KB Homes Coastal and its parent entities have not previously defaulted in payment of, and are not currently delinquent on, any ad valorem, assessment or special tax obligations in any jurisdiction in any material amount. 14. KB Homes Coastal consents to the issuance of the Bonds. KB Homes Coastal acknowledges and agrees that the proceeds of the Bonds will be used as described in the Official Statement. 15. KB Homes Coastal intends to comply with the provision of Government Code Section 53341.5 relating to the Notice of Special Tax in connection with the sale of the Property, or portions thereof. 16. KB Homes Coastal acknowledges that interest on the Bonds is estimated to be capitalized through September 1, 2003 and that the Special Tax levies on Developed Property will commence in Fiscal Year 2003-04 (commencing with the December 1, 2003 tax installmen0 in order to pay for interest on the Bonds and to pay a portion of the administrative expenses relating to the District. B-4 17. KB Homes Coastal is solvent and no proceedings are pending or, to the actual knowledge of KB Homes Coastal after due inquiry, threatened in which KB Homes Coastal may be adjudicated as bankrupt or discharged from any and all of its debts or obligations or granted an extension of time to pay its debts or obligations or a reorganization or readjustment of its debts or be subject to control or supervision of the Federal Deposit Insurance Corporation. 18. The parent entities of KB Homes Coastal are solvent and no proceedings are pending, or to the actual knowledge of KB Homes Coastal atter due inquiry, threatened in which the parent entities of KB Homes Coastal may be adjudicated as bankrupt or discharged from any or all of its debts or obligations, or granted an extension of time to pay its debt or obligations, or be allowed to reorganize or readjust its debts or obligations or be subject to control or supervision of the Federal Deposit Insurance Corporation. 19. KB Homes Coastal has not filed for, nor is KB Homes Coastal aware of, current proceedings for the reassessment of the assessed value of the Property. 20. To the actual knowledge of KB Homes Coastal after due inquiry, there are no claims, disputes, suits, actions or contingent liabilities among, by and between KB Homes Coastal or its Affiliates and any contractors working on the development of the Property which may materially and adversely affect the development of the Property or the payment of the Special Taxes. 21. Based upon the current development plans, including, without limitation, the current budget and subject to economic conditions and risks generally inherent in the development of real property and KB Homes Coastal presently anticipates that it will have sufficient funds to carry on its business as presently conducted and as described in the Preliminary Official Statement and to pay Special Taxes assessed against the Property and do not anticipate that the Authority or the District will be required to resort to a draw on the Reserve Fund for payment of principal of or interest on the Bonds due to KB Homes Coastal's nonpayment of Special Taxes. However, none of KB Homes Coastal or its Affiliates are obligated to make any additional capital contribution or loan to KB Homes Coastal at any time and KB Homes Coastal reserves the right to change its plan at any time without notice. 22. All information submitted in writing by, or on behalf of, KB Homes Coastal to the Authority, the District, the Special Tax Consultant, Stephen G. White, MAI (the "Appraiser"), Disclosure Counsel or the Underwriter in connection with the issuance of the Bonds, was, at the time of submission, to the actual knowledge of KB Homes Coastal after due inquiry, tree and correct. 23. As to information indicated in Section 9 hereof concerning KB Homes Coastal, its Affiliates and the development of the Property, and subject to the limitations and exclusions set forth in Section 9, KB Homes Coastal agrees to indemnify and hold harmless, to the extent permitted by law, the Authority, the District, and their officials and employees, and each person, if any, who controls any of the foregoing within the meaning of Section 15 of the Securities Act of 1933, as amended, or of Section 20 of the Securities Exchange Act of 1934, as amended against any and all losses, claims, damages or liabilities, joint or several, to which such indemnified party may become subject under any statute or at law or in equity or otherwise, and B-5 shall reimburse any such indemnified party for any reasonable legal or other expense incurred by it in connection with investigating any claims against it and defending any actions, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon any untrue statement of a material fact or the omission to state, in the final Official Statement, as of its date or in any continuing disclosure statement provided by or on behalf of KB Homes Coastal, a material fact necessary to make the statement therein, in light of the cimumstances under which it was made not misleading. This indemnity provision shall not be construed as a limitation on any other liability which KB Homes Coastal may otherwise have to any indemnified party, provided that in no event shall KB Homes Coastal be obligated for double indemnification. 24. KB Homes Coastal has agreed to execute the Developer's Continuing Disclosure Agreement in the form included in Appendix G to the Preliminary Official Statement. 25. If between the date hereof and the date of the Closing any event relating to or affecting KB Homes Coastal, its Affiliates, or the development of the Property shall occur of which KB Homes Coastal has actual knowledge which might or would cause the Official Statement, as then supplemented or amended, to contain an untrue statement ora material fact or to omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, KB Homes Coastal shall notify the Authority, the District and the Underwriter and if in the opinion of counsel to the Authority or the Underwriter such event requires the preparation and publication of a supplement or amendment to the Official Statement, KB Homes Coastal shall cooperate with the Authority in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to counsel to the Authority and to the Underwriter. 26. For the "underwriting period," as defined in the Bond Purchase Agreement, if any event relating to or affecting KB Homes Coastal, its Affiliates, or the development of the Property shall occur as a result of which it is necessary, in the opinion of the Underwriter or counsel to the Authority, to amend or supplement the Official Statement in order to make the Official Statement not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, KB Homes Coastal shall cooperate with the Authority and the Underwriter in the preparation of an amendment or supplement to the Official Statement in form and substance satisfactory to the Underwriter and counsel to the Authority which will amend or supplement the Official Statement so that it will not contain an untrue statement ora material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time the Official Statement is delivered to a purchaser, not misleading. 27. KB Homes Coastal agrees to deliver a Certificate dated the date of issuance of the Bonds at the time of issuance of the Bonds in substantially the form attached as Exhibit A. 28. On behalf of KB Homes Coastal, I have reviewed the contents of this Certificate and have met with counsel to KB Homes Coastal, for the purpose of discussing the meaning of its contents. DATED: May ,2003 B-6 KB HOMES COASTAL, 1NC., a California corporation By: Name: Title: B-7 EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CLOSING CERTIFICATE OF THE LENNAR ENTITLES To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill) Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Community Facilities District No. 03-1 (Crowne Hill) of the Temecula Public Financing Authority 2003 Special Tax Bonds and to the Bond Purchase Agreement dated ,2003 (the "Bond Purchase Agreement") entered into in connection therewith. This certificate is delivered pursuant to the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. A copy of a Certificate (the "Certificate") dated ., 2003 delivered on behalf of Lennar Homes of California, Inc., a California corporation ("Lennar Homes"), Lennar Communities, Inc., a California corporation ("Lennar Communities"), Greystone Homes, Inc., a California corporation ("Greystone Homes"), U.S. Home, Inc., a California corporation ("U.S. Home") (collectively, the "Lennar Entities"), is attached hereto as Exhibit A. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of the Lennar Entities, and the undersigned, on behalf of the Lennar Entities, further certifies as follows: 1. Each statement made in the Certificate is affirmed and restated as ifmade on the date hereof. 2. No event has occurred since the date of the Preliminary Official Statement which has adversely affected or will materially and adversely affect the business, properties, operations, prospects or financial condition of the Lennar Entities, their Affiliates or LENOne which would materially and adversely affect the development of the Property or their ability to pay Special Taxes. 3. The Lennar Entities have received the Official Statement relating to the Bonds, and each statement made in the Certificate referring to the Preliminary Official Statement is affirmed as if it relates to the Official Statement. 4. Each statement made in the Certificate referring to the proposed Developer Continuing Disclosure Agreement is affirmed as if it relates to the Developer Continuing Disclosure Agreement as executed and delivered. C-1 5. Lennar Homes has duly authorized the execution and delivery of the Developer Continuing Disclosure Agreement, is duly authorized to perform the obligations on its part to be performed thereunder, and the Developer Continuing Disclosure Agreement constitutes the legal, valid and binding obligations of Lennar Homes, enforceable against it in accordance with its terms. Dated: June __~ 2003 Very truly yours, By: As of LENNAR COMMUNITIES, INC., a Califomia corporation As of LENNAR HOMES Of CALIFORNIA, INC., a California corporation, As of GREYSTONE HOMES 1NC., a California corporation As corporation of U.S. HOME, INC., a California C-2 May ,2003 Stone & Youngberg LLC 515 South Figueroa Street, Suite 1060 Los Angeles, California 90071 Re.' Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Ladies and Gentlemen: In connection with the proposed sale to you of Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Cmwne Hill) (the "District") 2003 Special Tax Bonds (the "Bonds"), the District has delivered to you a Preliminary Official Statement, dated May ,2003, relating to the Bonds (the "Preliminary Official Statement"). Lennar Homes of California, Inc., a California corporation ("Lennar Homes"), Lennar Communities, Inc., a California corporation ("Lennar Communities"), Greystone Homes, Inc., a Califomia corporation ("Greystone Homes"), U.S. Home, Inc., a California corporation ("U.S. Home") (collectively, the "Lennar Entities"), for purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, deems final as of its date the statements contained in the Preliminary Official Statement under the captions "INTRODUCTION - The Community Facilities District," "CONTINUING DISCLOSURE - Lennar Homes and KB Home Coastal,'"'THE COMMUNITY FACILITIES DISTRICT," "BONDOWNERS' RISKS - Endangered and Threatened Species" and "BONDOWNERS' RISKS - Hazardous Substances" (excluding therefrom information which is identified to a source other than Lennar Homes, the Lennar Entities or LENOne and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee," "- Estimated Assessed Value-to-Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values") relating to the Lennar Entities, their Affiliates, LENOne, orthe Property (including the proposed development thereof), the Lennar Entities' development plan, the Lennar Entities' financing plan and the contractual arrangements of the Lennar Entities and LENOne, except for the omission of no more than the following information: the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates of mandatory sinking fund payments, delivery dates, and any other terms of the Bonds relating to such matters. Very truly yours, By: As of LENNAR COMMUNITIES, INC., a California corporation As of LENNAR HOMES Of CALIFORNIA, INC., a California corporation As of GREYSTONE HOMES, INC., a California corporation As of U.S. HOME, INC., a California corporation EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CLOSING CERTIFICATE OF PCC III To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill) Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Community Facilities District No. 03-1 (Crowne Hill) of the Temecula Public Financing Authority 2003 Special Tax Bonds and to the Bond Purchase Agreement dated ,2003 (the "Bond Purchase Agreement") entered into in connection therewith. This certificate is delivered pursuant to the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. A copy ora Certificate (the "Certificate") dated ,2003 delivered on behalf of Pacific Century Homes, Inc., a California Corporation as the Administrative Member of PCC III - Crowne Hill, LLC, a Delaware limited liability company ("PCC III") is attached hereto as Exhibit A. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of PCC III, and the undersigned, on behalf of PCC III, further certifies as follows: 1. Each statement made in the Certificate is affirmed and restated as if made on the date hereof. 2. No event has occurred since the date ofthe Preliminary Official Statement which has adversely affected or will materially and adversely affect the business, properties, operations, prospects or financial condition of PCC III which would materially and adversely affect the development of the Property or its ability to pay Special Taxes. 3. PCC III has received the Official Statement relating to the Bonds, and each statement made in the Certificate referring to the Preliminary Official Statement is affirmed as if it relates to the Official Statement. DATED: June ,2003 Very truly yours, By: C-1 PCC III - CROWNE HILL LLC, a Delaware limited liability company By: PACIFIC CENTURY HOMES, INC., a Cali£omia corporation its Administrative Member By: Name: Title: C-2 May ,2003 Stone & Youngberg LLC 515 South Figueroa Street, Suite 1060 Los Angeles, California 90071 Re: Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Ladies and Gentlemen: In connection with the proposed sale to you of Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds (the "Bonds"), the District has delivered to you a Preliminary Official Statement, dated May ,2003, relating to the Bonds (the "Preliminary Official Statement"). Pacific Century Homes, Inc., a California Corporation as the Administrative Member of PCC III - Crowne Hill LLC, a Delaware limited liability company ("PCC III"), for purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, deems final as of its date the statements contained in the Preliminary Official Statement under the captions "INTRODUCTION - The Community Facilities District," "THE COMMUNITY FACILITIES DISTRICT," "BONDOWNERS' RISKS - Endangered and Threatened Species" and "BONDOWNERS' RISKS - Hazardous Substances" (excluding therefrom information which is identified to a source other than PCC III and the information under the captions "THE COMMUNITY FACILITIES DISTRICT- Estimated Special Tax Allocation by Property Ownership," "- Transportation Uniform Mitigation Fee," "- Estimated Assessed Value-to-Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ) relating to PCC III, or the Property (including the proposed development thereof), PCC III's development plan, PCC IIl's financing plan and the contractual arrangements of PCC III, except for the omission of no more than the following information: the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates of mandatory sinking fund payments, delivery dates, and any other terms of the Bonds relating to such matters. Very truly yours, PCC III - CROWNE HILL LLC, a Delaware limited liability company By: PACIFIC CENTURY HOMES, 1NC., a California corporation its Administrative Member By: Name: Title: 4 EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CLOSING CERTIFICATE OF PCC 100 To~ Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill) Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Community Facilities District No. 03-1 (Crowne Hill) of the Temecula Public Financing Authority 2003 Special Tax Bonds and to the Bond Purchase Agreement dated ., 2003 (the "Bond Purchase Agreement") entered into in connection therewith. This certificate is delivered pursuant to the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. A copy ora Certificate (the "Certificate") dated ,2003 delivered on behalf of Greystone Homes as the Administrative Member of PCC III - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100") is attached hereto as Exhibit A. The undersigned certifies that he is familiar with the facts heroin certified and is authorized and qualified to certify the same as an authorized officer of PCC 100, and the undersigned, on behalf of PCC 100, further certifies as follows: 1. Each statement made in the Certificate is affirmed and restated as if made on the date hereofi 2. No event has occurred since the date of the Preliminary Official Statement which has adversely affected or will materially and adversely affect the business, properties, operations, prospects or financial condition of PCC 100 which would materially and adversely affect the development of the Property or its ability to pay Special Taxes. 3. PCC 100 has received the Official Statement relating to the Bonds, and each statement made in the Certificate referring to the Preliminary Official Statement is affirmed as if it relates to the Official Statement. DATED: June ,2003 Very truly yours, By: C-I PCC III - CROWNE HILL 100, LLC, a Delaware limited liability company By: GREYSTONE HOMES, INC., a California corporation its Administrative Member By: Name: Title: C-2 May ,2003 Stone & Youngberg LLC 515 South Figueroa Street, Suite 1060 Los Angeles, California 90071 Re-' Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Ladies and Gentlemen: In connection with the proposed sale to you of Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds (the "Bonds"), the District has delivered to you a Preliminary Official Statement, dated May ,2003, relating to the Bonds (the "Preliminary Official Statement"). Greystone Homes as the Administrative Member of PCC III - Crowne Hill 100, LLC, a Delaware limited liability company ("PCC 100"), for purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, deems final as of its date the statements contained in the Preliminary Official Statement under the captions "INTRODUCTION - The Community Facilities District," "THE COMMUNITY FACILITIES DISTRICT," "BONDOWNERS' RISKS - Endangered and Threatened Species" and "BONDOWNERS' RiSKS-Hazardous Substances" (excluding therefrom information which is identified to a source other than PCC 100 and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,"" - Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to- Lien Ratios,"" - Market Absorption Study," and" - Appraised Property Values" ) relating to PCC 100, or the Property (including the proposed development thereof), PCC 100's development plan, PCC 100's financing plan and the contractual arrangements of PCC 100, except for the omission of no more than the following information: the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates of mandatory sinking fund payments, delivery dates, and any other terms of the Bonds relating to such matters. Very truly yours, PCC III - CROWNE HILL 100, LLC, a Delaware limited liability company By: GREYSTONE HOMES, INC., a California corporation its Administrative Member By: Name: Title: EXHIBIT C TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) 2003 SPECIAL TAX BONDS CLOSING CERTIFICATE OF KB HOMES COASTAL To: Temecula Public Financing Authority on behalf of Community Facilities District No. 03-1 (Crowne Hill) Stone & Youngberg LLC Ladies and Gentlemen: Reference is made to Community Facilities District No. 03-1 (Crowne Hill) of the Temecula Public Financing Authority 2003 Special Tax Bonds and to the Bond Purchase Agreement dated ,2003 (the "Bond Purchase Agreement") entered into in connection therewith. This certificate is delivered pursuant to the Bond Purchase Agreement. Capitalized terms used herein and not otherwise defined have the meanings ascribed to them in the Bond Purchase Agreement. A copy of a Certificate (the "Certificate") dated ,2003 delivered on behalf of KB Homes Coastal of California, Inc., a California corporation (''KB Homes Coastal"), is attached hereto as Exhibit A. The undersigned certifies that he is familiar with the facts herein certified and is authorized and qualified to certify the same as an authorized officer of KB Homes Coastal, and the undersigned, on behalf of KB Homes Coastal, further certifies as follows: 1. Each statement made in the Certificate is affirmed and restated as ifmade on the date hereof. 2. No event has occurred since the date of the Preliminary Official Statement which has adversely affected or will materially and adversely affect the business, properties, operations, prospects or financial condition of KB Homes Coastal, or its Affiliates which would materially and adversely affect the development of the Property or its ability to pay Special Taxes. 3. KB Homes Coastal has received the Official Statement relating to the Bonds, and each statement made in the Certificate referring to the Preliminary Official Statement is affirmed as if it relates to the Official Statement. 4. Each statement made in the Certificate referring to the proposed Developer Continuing Disclosure Agreement is affirmed as if it relates to the Developer Continuing Disclosure Agreement as executed and delivered. 5. KB Homes Coastal has duly authorized the execution and delivery of the Developer Continuing Disclosure Agreement, is duly authorized to perform the obligations on its part to be performed thereunder, and the Developer Continuing Disclosure Agreement constitutes the legal, valid and binding obligations of KB Homes Coastal, enforceable against it in accordance with its terms. C-1 Dated: June ___,2003 Very truly yours, KB HOMES COASTAL, INC., a Cali£omia corporation By: Name: Title: C-2 May ,2003 Stone & Youngberg LLC 515 South Figueroa Street, Suite 1060 Los Angeles, Califomia 90071 Re'- Temeeula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Ladies and Gemlemen: In connection with the proposed sale to you of Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Cmwne Hill) (the "District") 2003 Special Tax Bonds (the "Bonds"), the District has delivered to you a Preliminary Official Statement, dated May ,2003, relating to the Bonds (the "Preliminary Official Statement"). KB Homes Coastal of California, Inc., a California corporation ("KB Homes Coastal"), for purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, deems final as of its date the statements contained in the Preliminary Official Statemem under the captions "INTRODUCTION - The Community Facilities District," "CONTINUING DISCLOSURE - Lennar Homes and KB Home Coastal,'"'THE COMMUNITY FACILITIES DISTRICT," "BONDOWNERS' RISKS- Endangered and Threatened Species" and "BONDOWNERS' RISKS - Hazardous Substances" (excluding therefrom information which is identified to a source other than KB Homes Coastal, and the information under the captions "THE COMMUNITY FACILITIES DISTRICT - Estimated Special Tax Allocation by Property Ownership,""- Transportation Uniform Mitigation Fee,"" - Estimated Assessed Value-to-Lien Ratios," "- Market Absorption Study," and" - Appraised Property Values" ) relating to KB Homes Coastal, its Affiliates, or the Property (including the proposed development thereof), KB Homes Coastal's development plan, KB Homes Coastal's financing plan and the contractual arrangements of KB Homes Coastal, except for the omission of no more than the following information: the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates of mandatory sinking fund payments, delivery dates, and any other terms of the Bonds relating to such matters. Very truly yours, KB HOMES COASTAL, INC., a California corporation By: Name: Title: EXHIBIT D FORMS OF OPINION OF COUNSEL TO LENNAR COMMUNITIES AND TO KB HOME COASTAL C- ] TEMCH BPA~.wpd/LIU424 EXHIBIT E ACKNOWLEDGMENT OF LENONE, INC., A VIRGINIA CORPORATION RELATING TO THE ISSUANCE OF BONDS AND THE IMPOSITION OF THE SPECIAL TAX BY TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) The undersigned, ., [TITLE], ofLENOne, a Virginia corporation ("LENOne"), hereby acknowledges for the benefit of the Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) (the "District") as follows: California. LENOne is a Virginia corporation in good standing under the laws of the State of 2. The undersigned has all authority necessary to execute this Acknowledgment on behalf of LENOne for delivery to the Board of Directors (the "Board") of the Temecula Public Financing Authority (the "Authority") in connection with the imposition by the Board, as the legislative body of the District, of the special tax of the District on the property located within the District, as more particularly described on the attached Exhibit "A" (the "Property") relative to which LENOne has entered into various agreements as described below. 3. On July 12, 2002, title to 344 lots owned by PCC III - Crowne Hill LLC, a Delaware limited liability company ("PCC III") and title to 112 lots owned by PCC III - Crowne Hill 112, LLC, a Delaware limited liability company ("PCC 112") was transferred to LENOne. As of March 15, 2003, LENOne owned 439 lots. LENOne entered into three Construction Agreements (a "Crowne Hill 213 Construction Agreement," a "Crowne Hill 131 Construction Agreement," and a Crowne Hill 112 Construction Agreement,") with Lennar Communities, Inc., a California corporation ("Lennar Communities") and Lennar Homes of California, Inc. ("Lennar Homes") and three Option Agreements (a"Crowne Hill 213 Option Agreement," a"Crowne Hill 131 Construction Agreement," and a "Crowne Hill 113 Construction Agreement") with Lennar Communities, and Greystone Homes, Inc., a California corporation ("Greystone Homes"). Pursuant to the terms of the Construction Agreements, Lennar Homes and Lennar Communities are obligated to perform all work necessary to bring all of LENOne's lots to a finished stage. Pursuant to the three Option Agreements, Lennar Homes and Greystone Homes are given the option to purchase LENOne's lots and are permitted to construct homes thereon even prior to exercising their options to purchase. 4. LENOne has received from Lennar Communities and Lennar Homes the Notice of Special Tax Lien (Recorded April 4, 2003, as Document No. 2003-238653), including the attached Rate and Method of Apportionment of the Special Tax. 5. LENOne hereby acknowledges the imposition of the special tax of the District on the Property in the form, at the rates and in the manner set forth in the Notice of Special Tax Lien. LENOne does not object to the proceedings taken by the Authority to form the District, including the election therefor or the levy of the special tax for any authorized purpose, including but not limited to, the payment of debt service on bonds of the District, provided that LENOne does not E-1 waive its rights to object to any levy for other than an authorized purpose or otherwise in violation of the voter authorization referred to herein. 6. LENOne acknowledges that the failure to pay the special tax of the District levied against the Property may result in the foreclosure of the Property. 7. To the undersigned's present actual knowledge after due inquiry, LENOne has not notified any party to the Option Agreements or the Construction Agreements of an event of default under such agreements, and, to the undersigned's present actual knowledge without investigation, the undersigned is not aware of any event that, with the giving of notice and the passage of time, might constitute an event of default under the Option Agreements or the Construction Agreements. 8. LENOne and its major shareholders are solvent and no proceedings are pending or, to the present actual knowledge of the undersigned without investigation, threatened in which LENOne or its major shareholders may be adjudicated as bankrupt or discharged from any and all of their debts or obligations or granted an extension of time to pay their debts or obligations or a reorganization or readjustment of their debts. Date: May _, 2003 LENOne, a Virginia corporation By: Name: Title: EXHIBIT E ACKNOWLEDGMENT OF CONSENT TO THE IMPOSITION OF THE SPECIAL TAX FOR TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) AND THE ISSUANCE OF BONDS The undersigned, , [TITLE], of a and ., a (the "Lender"), hereby acknowledges for the benefit of the Temecula Public Financing Authority Community Facilities District No. 03~ 1 (Crowne Hill) (the "District") as follows: 1. The undersigned has all authority necessary to execute this Acknowledgment on behalf of the Lender for delivery to the Board of Directors (the "Board") of the Temecula Public Financing Authority (the "Authority") in connection with the imposition by the Board, as the legislative body of the District, of the special tax of the District on the property located within the District, as more particularly described on the attached Exhibit "A" (the "Properly") relative to which the Lender has loaned money to PCC lll- Crowne Hill LLC, a Delaware limited liability company ("PCC IIl") ("Borrower") pursuant to a and other loan documents relating thereto (together, the "Loan Agreement"), and with respect to which the Lender has acquired or received a beneficial security interest in the Property. 2. The Lender has received from the Borrower and the Borrower has made available to the Lender the Notice of Special Tax Lien (Recorded April 4, 2003, as Document No. 2003-238653), including the attached Rate and Method of Apportionment of the Special Tax and the Preliminary Official Statement regarding the issuance of bonds of the District to be secured by such tax, pursuant to the Mello-Roos Community Facilities Act of 1982, as amended (Sections 53311 et seq. of the Government Code of the State of California) (the "Act"). 3. The Lender hereby acknowledges the imposition of the special tax of the District on the Property in the form, at the rates and in the manner set forth in the Notice of Special Tax Lien. The Lender does not object to the proceedings taken by the Authority to form the District, including the election therefor or the levy of the special tax for any authorized purpose, including but not limited to, the payment of debt service on bonds of the District, provided that the Lender does not waive its rights to object to any levy for other than an authorized purpose or otherwise in violation of the voter authorization referred to herein. 4. The Lender acknowledges that if any default occurs in the payment of the special tax of the District levied against the Property pursuant to Exhibit "A" hereto, the District has the right, subject to provisions of the Act, to foreclose upon the Property. 5. The Lender acknowledges that liens securing the special tax levied against the Property have priority over the Lender's security interest in the Property. 6. To the Lender's actual knowledge, there is no event of default under the Loan Agreement and no event which with notice might constitute an event of default under the Loan Agreement. Date: , a By: Name: Title: By: Name: Title: E-3 TEMCH BP~da.wpd/LR/424 ,2003 Stone & Youngberg LLC 515 South Figueroa Street, Suite 1060 Los Angeles, California 90071 Re: Temecula Public Financing Authority Community Facilities District No. 03-1 (Crowne Hill) 2003 Special Tax Bonds Ladies and Gentlemen: In connection with the proposed sale to you of Temecula Public Financing Authority (the "Authority") Community Facilities District No. 03-1 (Crowne Hill) (the "District") 2003 Special Tax Bonds (the "Bonds"), the Authority has delivered to you a Preliminary Official Statement, dated ,2003, relating to the Bonds (the "Preliminary Official Statement"). The Authority, for purposes of compliance with Rule 15c2-12 of the Securities and Exchange Commission, deems the Preliminary Official Statement to be final as of its date, except for the omission of no more than the following information: the offering prices, interest rates, selling compensation, aggregate principal amount, principal amount per maturity, dates of mandatory sinking fund payments, delivery dates, and any other terms of the Bonds relating to such matters. Very truly yours, TEMECULA PUBLIC FINANCING AUTHORITY COMMUNITY FACILITIES DISTRICT NO. 03-1 (CROWNE HILL) By: Shawn Nelson, acting on behalf of Temecula Public Financing Authority for the District TEMCH BPAh.wlxl/LP-J424 ITEM 3 APPROVAL ~,,-~ CITY ATTORNEY '--~Z)~, ~ DIR.OFFINANCE ~ ClTY MANAGER TEMECULAPUBLIC FINANCING AUTHORITY AGENDA REPORT TO: FROM: DATE: SUBJECT: Temecula Public Financing Authority Executive Director Shawn Nelson May 13, 2003 Public Hearings Regarding Formation of Community Facilities District No. 01-3 (Wolf Creek), and Amendment of Resolution of Intention to Form the District RECOMMENDATION: 1. That the Authority adopt the resolution entitled: RESOLUTION NO. TPFA 03-._ A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY MAKING FINDINGS OF COMPLEXITY OF PROPOSED COMMUNITY FACILITIES DISTRICT NO. 01-3 (WOLF CREEK) AND AMENDING RESOLUTION OF INTENTION TO FORM THE DISTRICT BACKGROUND: S-P Murdy, LLC, a California limited liability company (the "Landowner") has requested that the Authority form a community facilities district to (i) assist in the funding of various public improvements necessitated by the construction of the Wolf Creek subdivision or otherwise satisfying obligations arising from the development, and (ii) provide a means to fund the costs of maintenance services for a drainage channel. The CFD will only include land owned by the Landowner. On March 18, 2003, the Authority adopted two resolutions related to the formation of the CFD (the "Resolutions of Intention"), expressing the intent of the Board of Directors of the Authority to establish the CFD and for the CFD to incur bonded indebtedness to finance various public infrastructure improvements necessitated by development to occur in the CFD. The Resolutions of Intention called for public hearings regarding the CFD to occur on April 22, 2003. R:/Agenda Reports/CFD 01-3 Wolf Creek 1 Some of the improvements to be financed by the CFD are expected to be owned and operated by the Riverside County Flood Control and Water Conservation District, and Riverside County Staff have been drafting a joint community facilities agreement (the "County Agreement") related to those improvements. In addition, the Landowner has requested that the CFD be authorized to finance improvements to be constructed by the Eastern Municipal Water District ("EMWD"), which were not included in the list of facilities to be financed by the CFD set forth in the resolution of intention to form the CFD. The California Government Code requires that the Authority execute joint community facilities agreements with public agencies that will own or operate improvements to be financed by the CFD prior to the adoption of a resolution of the Authority to form the CFD. The resolution of formation of the CFD is usually adopted immediately following the conclusion of the public hearings regarding formation of the CFD. Section 53325 of the California Government Code requires that the public hearings regarding the CFD be concluded within 30 days, unless the Board determines that the complexity of the CFD or the need for public participation requires additional time, in which event the public hearings can be continued for up to six months. The Resolution before the Board makes the necessary findings so that the public hearings need not be concluded within 30 days of April 22nd, and can be continued to June 24th (and further continued, if necessary) to allow the County Agreement to be finalized and executed and a joint community facilities agreement with EMWD to be drafted, negotiated and executed, so that the joint community facilities agreements for all of the improvements to be financed by the CFD can be concluded prior to the conclusion of the public hearings. The Resolution also amends the resolution of intention to form the CFD to allow the CFD to finance improvements to be owned and operated by EMWD. The Authority recently entered into a similar arrangement with EMWD with respect to its Crowne Hill community facilities district. The Landowner has agreed to pay all City and Authority costs related to the proposed CFD formation and bond issue, and has submitted a depositJreimbursement agreement with respect thereto. The bonds will be payable solely from special taxes levied on land in the CFD. FISCAL IMPACT: The Landowner has agreed to pay all out of pocket expenses incurred relative to the proposed CFD and the related bond financing. Costs of issuance of the proposed bond issue will be paid from the proceeds of the bonds to be issued by the Authority. All costs of the Authority related to any joint community facilities agreement and any annual costs of administering the bonds issued will be paid from bond proceeds or by special taxes levied on the properties in the CFD. The bonds will not be obligations of the City or the Redevelopment Agency, but will be limited obligations of the Authority, payable solely from special taxes levied on land in the CFD. Attachment: Resolution R:/Agenda Reports/CFD 01-3 Wolf Creek 2 RESOLUTION NO. TPFA 03-__ A RESOLUTION OF THE BOARD OF DIRECTORS OF THE TEMECULA PUBLIC FINANCING AUTHORITY MAKING FINDINGS OF COMPLEXITY OF PROPOSED COMMUNITY FACILITIES DISTRICT NO. 01-3 (WOLF CREEK) AND AMENDING RESOLUTION OF INTENTION TO FORM THE DISTRICT 'WHEREAS, on March 18, 2003 this Board of Directors (the "Board") of the Temecula Public Financing Authority (the "Authority") adopted a Resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority Declaring Its Intention to Establish a Community Facilities District and to Authorize the Levy of Special Taxes Therein - Wolf Creek" (the "Resolution of Intention to Form the CFD") and a Resolution entitled "A Resolution of the Board of Directors of the Temecula Public Financing Authority Declaring Its Intention to Incur Bonded Indebtedness of the Proposed Temecula Public Financing Authority Community Facilities District No. 01-3 (Wolf Creek)" (collectively with the Resolution of Intention to Form the CFD, the "Resolutions of Intention"), declaring its intention to form a community facilities district to be known as the."Temecula Public Financing Authority Community Facilities District No. 01-3 (Wolf Creek)~ (the UDistrict") under the provisions of the Mello-Roos Community Facilities Act of 1982, constituting Section 53311 et seq. of the California Government Code (the "Law"), and to incur bonded indebtedness of the District to finance various public improvements; and WHEREAS, the Resolutions of Intention called for public hearings to be held on the formation of the District and the issuance of bonds of the Authority for the District on April 22, 2003; and WHEREAS, notice of the public hearings was published more than seven days prior to the scheduled date for the hearings as required by the Law, and the public hearings were opened by this Board on April 22, 2003 and continued to May 13, 2003 to allow for more time for the Riverside County Flood Control and Water Conservation District to prepare a joint community facilities agreement for the District (the "County Agreement") and to allow time for discussions to be had between staff of the City of Temecula and the owner of the property in the proposed District regarding the facilities to be financed by the District; and WHEREAS, the Authority has agreed to expand the scope of the public improvements to be financed by the District and is reviewing the County Agreement and preparing other joint community facilities agreements for the District, such that the Resolution of Intention to Form the CFD needs to be amended to include additional improvements and additional time is needed to complete the joint community facilities agreements for the proposed District; and WHEREAS, Section 53325 of the Law requires that the public hearings be completed within 30 days unless this Board finds that the complexity of the proposed District or the need for public participation requires additional time, in which event the public hearings may be continued from time to time for a period not to exceed six months, and this Board now desires to make such findings. NOW, THEREFORE, BE IT RESOLVED by the Board of Directors of the Temecula Public Financing Authority as follows: R:/TPFA Resos 2003/'rPFA 03-_ I SECTION 1. The complexity of the proposed District and the need for public participation requires additional time, such that the public hearings called pursuant to the Resolutions of Intention may be continued by this Board from time to time as it considers necessary in the circumstances, not to exceed six months from April 22, 2003. The Board hereby continues the public hearings to June 24, 2003, at which time the Board will hold and conclude the public hearings or, if it determines that a further continuance is appropriate in the circumstances, will continue the public hearings to a date to be specified by the Board. SECTION 2. The Resolution of Intention to form the CFD is hereby amended by adding the following to Exhibit A to said Resolution as a new item 12. to the list of the Facilities (as defined in the Resolution of Intention to Form the CFD) to be funded by the District: "12. Sanitary sewer system and water system improvements to be designated by the Eastern Municipal Water District on which it will expend up to $5,501,200 of bond funds." R:/TPFA Resos 2003/TPFA 03-~ 2 PASSED, APPROVED AND ADOPTED, by the Board of Directors of the Temecula Public Financing Authority at a meeting held on the 13th day of May, 2003. ATTEST: Jeffrey E. Stone, Chairperson Susan W. Jones, CMC City Clerk/Authority Secretary [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan Jones, Secretary of the Temecula Public Financing Authority, HEREBY DO CERTIFY that the foregoing Resolution No. TPFA 03- was duly adopted atlathspecial3 meeting of the Board of Directors of the Temecula Public Financing Authority on the day of May, 2003, by the following vote: AYES: BOARDMEMBERS: NOES: BOARDMEMBERS: ABSENT: BOARDMEMBERS: ABSTAIN: BOARDMEMBERS: Susan W. Jones, CMC City Clerk/Authority Secretary R:/'rPFA Resos 2003/TPFA 03-__ 3 ITEM 30 APPROVAL FINANC_~-~, CITY MANAGER /'-/~1 TO: FROM: DATE: SUBJECT: CITY OF TEMECULA AGENDA REPORT City Manager/C'~,,~mcil Debbie Ubnosk~, Director of Planning May 13, 2003 PA02-0567 Edge Nightclub Appeal PREPARED BY: Debbie Ubnoske, Director of Planning RECOMMENDATION: Continue to May 27, 2003 BACKGROUND: PA02-0567, an application for the Edge Nightclub, was denied by the Planning Commission on January 29, 2003. The applicant subsequently appealed the Planning Commission's denial. The appeal for the Planning Commission's denial of PA02-0567 was heard by the City Council on March 25, 2003 and April 22, 2003. At the April 22nd hearing, the Council continued this item to May 13, 2003. Staff is requesting one more continuance to May 27, 2003. FISCAL IMPACT: N~A ATTACHMENTS: R:\debbie\cc staff report edge nightclub may 13, 2003.dcc 1 ITEM 31 TO: FROM: DATE: SUBJECT: APPROVAL CITY ATTO R NEy "~-~/~ DIRECTOR OF FINANCE /~I,'""---- CITY MANAGER ~,~ ~ CITY OF TEMECULA AGENDA REPORT City Manager/Cit~'ncil Debbie Ubnoske~, Director of Planning May 13, 2003 Development Code Amendment (Planning Application 03-0109) PREPARED BY: David Hogan, Principal Planner RECOMMENDATION: READ by title only and introduce an ordinance entitled: ORDINANCE NO. 03- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES, AND PROVIDE FOR THE RE-ADOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6 (PLANNING APPLICATION 03-0109) BACKGROUND: In the course of the last few months, and as part of the ongoing user fee study, staff has identified a number of potential changes to the Development Code. These proposed amendments are as follows: · Define what are major and minor modifications to development plans, and clarify the application process for projects requiring both a development plan and conditional use permit. The Development Code currently does not provide a clear mechanism to modify development plans and conditional use permits. These amendments support the ongoing user fee study which will establish the fee for changing approved development plans and conditional use permits. · Create standards and procedures for Planned Residential Developments that will allow flexible residential standards on difficult sites. The total site density established by the General Plan would not change. R:\DEVCODE\03-0109 Amendment\Staff Report CC.doc 1 Authorize the adoption by reference for complicated Planned Development Overlay (PDO) projects and re-adopt Planned Development Overlay Numbers 5 and 6 as uncodified ordinances. This is necessary because some of the more recent PDO's have become mini-specific plans that are not conducive to codification within the municipal code. Clarify confusion concerning the approval of sign programs and the allowable types, and duration of use for ambient air balloons with Christmas season themes during the holiday season. · Update the approval authority table in Chapter 17.03 to conform with these other changes. Eliminate the reduced legal notice radius provisions (only 300 feet) for minor conditional use permits. The standard property owner notification radius for all other applications is 600 feet. At present, the reduced radius range does not noticeably simplify the minor conditional use permit process, it only adds confusion to both applicants and staff. The Planning Commission considered the proposed ordinance on March 19, 2003. At the meeting, the Commission adopted a resolution recommending that the Council adopt the proposed ordinance. The primary change to the ordinance was made to the approval authority for major development plan modifications. Staff had originally recommended that major modifications be made at a staff level. Following their discussion, the Commission felt that it was more appropriate for development plans that were approved by the Planning Commission be reconsidered by the Planning Commission. This change has been made to the proposed ordinance. A copy of the proposed Ordinance is contained in Attachment No. I. The Planning Commission Resolution, Minutes, and Staff Report are contained in Attachment Nos. 2, 3 and 4, respectively. ENVIRONMENTAL DETERMINATION: This amendment to the Temecula Municipal Code represents a series of minor changes mostly regulating the implementation of the zoning procedures and requirements and further clarifying the approval authority matrix and sign regulations. The Planning Commission has reviewed the proposed changes to the Development Code and has determined that the project has no potential to have an adverse impact on the environment. As result, staff is recommending that the Commission make a recommendation to the City Council that a no impact finding pursuant to Section 15061 (b)(3) of the California Environmental Quality Act Guidelines be made. FISCAL IMPACT: None. ATTACHMENTS: 2. 3. 4. Proposed Ordinance Planning Commission Resolution Planning Commission Minutes Planning Commission Staff Report R:\DEVCODE\03-0109 Amendment\Staff Report Ce.doc 2 ATFACHMENT NO. 1 PROPOSED ORDINANCE R:\DEVCODE\03-0109 Amendment\Staff Report CC.doc 3 ORDINANCE NO. 03- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES AND PROVIDE FOR THE READOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6 (PLANNING APPLICATION 03-0109) WHEREAS, Section 65800 of the Government Code provides for the adoption and administration of zoning laws, ordinances, rules and regulations by cities to implement such general plans as may be in effect in any such city; WHEREAS, the Planning Commission held a duly noticed public hearing on Mamh 19, 2003, and recommended that the City Council approve the attached amendments to the City Municipal Code; WHEREAS, this Ordinance complies with all the applicable requirements of State law and local ordinances; WHEREAS, notice of the proposed Ordinance was posted at City Hall, Temecula Library, Pujol Street Community Center, and the Temecula Valley Chamber of Commerce; and, WHEREAS, the City Council has held a duly noticed public hearing on May 13, 2003 to consider the proposed amendments to the Temecula Municipal Code. THE CITY COUNCIL OF THE CITY OF TEMECULA DOES HEREBY ORDAIN AS FOLLOWS: Section 1. The City Council of the City of Temecula hereby adds Section 17.05.030 to the Temecula Municipal Code to read as follows: "17.05.030 Modifications to an Approved Development Plan Purpose and Intent. The purpose of this section is to establish the requirements and procedures to allow the administrative modification of an unexpired development plan or conditional use permit. For the purposes of this Section, the following changes are not eligible for consideration as an administrative modification: a change in the type of building (commercial, office, industrial), a substantial intensification of the project or type of use, or substantial changes to the project layout or access. Proposed project changes that are not eligible for a modification under this Section will require resubmittal of a new application. Types of Modifications. Modifications to approved development plans are divided into two categories, major and minor. If a proposed modification includes both maior and minor modifications, the application shalt be considered a major modification. The final decision as to whether a modification is major or minor shall be at the sole discretion of the director of planning. R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc Major Modifications to approved development plans include the following types of project changes: Increasing the height of the building by more than 10 feet or one- story. b. An increase of more than 10% of the building footprint. A substantial change in the architecture of the building or substantial changes to the exterior elevations, including but not limited to the locations of windows or doors. d. A modification in the approved access to the project site. The shift of building location that effects the layout and location of the required parking, site access, or substantially changes the conceptual landscape plan. f. A change in the number of primary structures. Changes to a conditional use permit that require the physical modification of the site. Minor Modifications to approved development plans include the following types of project changes: a. An increase of less than 10% of the building footprint. b. A change in the layout of the parking or loading area. c. The relocation of windows or doors on one or two wall surfaces. An adjustment in the location of buildings provided the general location of each building is similar to the approved development plan. Changes to a conditional use permit that do not require the physical modification of the site. Modifications to approved development plans that are subject to the administrative development plan process include the following: a. Changes to the approved landscaping plant palette. b. Changes in exterior colors or materials. Application Requirements. Applications for modifying development plans shall be completed in accordance with Section 17.03.030 of this development code. Procedure for Approval. Minor modifications may be approved administratively and never require a specific notice or consideration at a public hearing. The approval of major modifications requires consideration by the original approval body. Major R:\DEVCODE\03-0109 Amendment\Ordinance to CC.doc 2 modifications which were approved at a director hearing may be approved administratively by the director of planning providing the revised project could have been approved initially by the director of planning. The director of planning may refer any modifications or changes in building design to the planning commission for consideration. Findings. Approving modifications to an approved development plan shall require the same findings as were made on the original approval. Revocations. Approval of a modification to a development plan may be revoked or modified by the director of planning in accordance with Section 17.03.060." Section 2. The City Council of the City of Temecula hereby amends portions of Section 17.04.010. A. Subsection C is hereby amended to read as follows: "Authority. Conditional use permits shall require a public hearing as follows: When a conditional use permit involves an existing building, the director of planning shall have the authority to approve, conditionally approve or deny an application for a conditional use permit. Decisions of the director of planning may be appealed to the planning commission, pursuant to Section 17.030.090. When a conditional use permit accompanies an application for a development plan for a new building that is less than 10,000 square feet, the director of planning shall have the authority to approve, conditionally approve, or deny an application for conditional use permit. Decisions of the director of planning may be appealed to the planning commission, pursuant to Chapter 17.03.090. When a conditional use permit accompanies an application for a development plan for a new building that is 10,000 square feet or greater, or whenever the director of planning has determined that the matter should be forwarded to the planning commission. The planning commission shall have the authority to approve, conditionally approve, or deny an application for a conditional use permit. Decisions of the planning commission may be appealed to the city council, pursuant to Section 17.03.090." B. Subsection J is hereby added to this Section to read as follows: "Modifications of a Conditional Use Permit. Requests to modify a conditional use permit shall be made in conformance with the provisions of Section 17.05.030." Section 3. The City Council of the City of Temecula hereby adopts Section 17.22.070 to read as follows: "17.22.070 APPROVED PLANNED DEVELOPMENT OVERLAYS. The following planned development overlays, cannot be effectively incorporated into the municipal code, have been approved by the city and are designated on the official zoning map of the city: R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc 3 PDO-5 Temecula Village PDO-6 Rancho Pueblo Future planned development overlays shall be numbered consecutively, whether incorporated into the municipal code or adopted as uncodified ordinances, and shown on the official zoning map of the city with the prefix "PDO"." Section 4. The City Council of the City of Temecula hereby repeals Sections 17.22.140 through 17.22.156 of the municipal code, adopted by Ordinance 02-05, and readopts the Temecula Creek Village Planned Development Overlay as uncodified PDO-5 pursuant to the provisions of 17.22.070, Section 5. The City Council of the City of Temecula hereby repeals Sections 17.22.160 through 17.22.178 of the municipal code, adopted by Ordinance 02-04, and readopts the Rancho Pueblo Planned Development Overlay as uncodified PDO-6 pursuant to the provisions of 17.22.070. Section 6. The City Council of the City of Temecula hereby adopts Section 17.06.045 to read as follows: "17.06.045 PLANNED RESIDENTIAL DEVELOPMENTS. Purpose and Intent. The purpose of the planned residential development is to allow for flexible development standards to protect open space areas or to address unique land use compatibility conditions. The intent of these provisions is to allow for the flexible lot sizes and site design standards on larger lots to protect biologic habitat and corridor areas and natural open spaces by concentrating development in less sensitive areas. Ail planned residential developments shall comply with the provisions of this section. Density. The total number of residential units may not exceed the density envisioned in the general plan. The maximum number of units shall be calculated by multiplying the total acreage by the density targets identified in the General Plan. Uses. The land uses in a planned residential development project shall comply with the requirements of Section 17.06.030, except that, if appropriately located, attached and multiple family residential units may be located in any residential zone. Development Standards. Compliance with the development standards identified in Section 17.06,040 is not required provided appropriate development criteria for detached and attached residential units, as needed, are established as part of each planned residential development. Notwithstanding this, the following criteria shall appty to all planned residential developments. The height of detached residential units shall not exceed 35 feet and the height of attached residential units shall not exceed 40 feet. Detached residential units should be separated by a distance of at least 6 feet for one-story units, by at least 10 feet for two-story units, and by at least 15 feet for structures that are taller than two-stories. R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc 4 Private yard areas shall be provided access that is at least 3 feet in width from either the front of the unit or from a rear access drive. This access shall be unobstructed by architectural projections, heating or cooling equipment, or any other permanent fixtures that would prevent its use as a pedestrian access. Attached residential units in primarily detached residential areas shall be architecturally designed to avoid a massive or monolithic appearance. Fully attached residential units without private yards shall be provided at least 200 square feet of private open space for each unit. The protection of open space areas, both during and after construction, is required. Operational conditions shall be imposed on each project to ensure that preserved areas remain substantially undisturbed. The clearing, grubbing, or grading of open space areas not immediately adjacent to areas of construction is prohibited. This provision is not intended to prevent the placement of informal hiking and walking trails in open space areas. The landscaping of open space areas shall not be required if the native plant communities are undisturbed. In areas where native vegetation has been substantially disturbed, native specie revegetation may be required. Notwithstanding this requirement, the supplemental enhancement of open space areas with local native tree species is encouraged and may be permitted. Each planned residential development shall specify how the provisions of Section 17.06.050 will be implemented. Exact compliance with all the provisions of Section 17.06.050 shall not be required provided the intent of the regulations is met. Procedure for Approval. Planned residential developments shall use the application and approval procedures identified in Section 17.04.010. Planned residential developments shall be approved by the planning commission. Related land division applications shall be processed in accordance with the provisions of Title 16 of the Temecula Municipal Code." Section 7. The City Council of the City of Temecuia hereby amends Table 17.06.040 as described below. A. Add a Footnote Number 4 to the headings for Lot Area, Lot Dimensions, Setbacks, and Other Requirements. B. Add Footnote No. 4 to the end of Table 17.06.040 to read as follows: "4. Projects designed as planned residential developments are not subject to these provisions provided the criteria in Section 17.06.046 are followed." Section 8. The City Council of the City of Temecula hereby amends the following portions of Chapter 17.28 of the Temecula Municipal Code. A. Amend Subsection 17.28.700. B to read as follows: "The maximum display time shall not exceed a total of fifteen (15) calendar days within any ninety (90) R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc 5 calendar day period. Except that during the month of the annual Balloon and Wine Festival and during the month of December, a thirty (30) calendar day permit may be issued by the Director." B. Amend Subsection 17.28.700.1 to read as follows; "Ambient air balloons shall only be in the shape of a traditional "hot air balloon". Ambient air balloons in the shape of blimps or cartoon characters are not permitted. Exception: During the month of December ambient air balloons in the shape of traditional Christmas characters or symbols are allowed." Section 9. The City Council of the City of Temecula hereby amends Subsection 17.03.040.B.2 to read as follows: "The notice shall be mailed first class and postage pre-paid to the applicant and representative; to the property owner or the owner's agent; 1o all persons whose names and addresses appear on the latest available assessment roll of the county of Riverside as owners of property within a distance of six hundred (600) feet from the exterior boundaries of the site for which the application is filed (a minimum of thirty property owners); to anyone filing a written request for notification; and to such other persons whose property might, in the planning commission's judgment, be affected by the establishment of the use or zone requested." Section 10. The City Council of the City of Temecula hereby amends Table 17.03.010 of the Temecula Municipal Code to read as follows: Table 17.03.010 Planning and Zoning Application Approval Authority Admin. Planning Planning City Application Approval Director Commission Council General plan amendment Recommen- X~ dation1 Zoning amendment: Text changes Recommen- X~ dation1 Zoning amendment: Map changes Recommen- X1 dation~ Zoning amendment: Specific plan, Recommen- X~ includes specific plan amendments dation1 Conditional use permit-existing X~,2 building Conditional use permit with a X1,2,3 X~,3 development plan Development plan (10,000 square X~ feet or greater) Development plan (less than X1 10,000 square feet) R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc 6 Table 17.03.010 Planning and Zoning Application Approval Authority Admin. Planning Planning City Application Approval Director Commission Council Major modifications X2'4 XTM Minor modifications X2 Administrative development plan X2 Home occupation permit X2 Large family day care home facility X~ Minor exceptions X2 Planned Residential Development X~ Sign permits X2 Sign programs, including sign X2 program modifications Temporary use permits X2 Variance X~ Footnotes: 1. Requires consideration at a noticed public hearing. 2 For matters that are considered to have special significance or impact, the director of planning may refer such items to the planning commission for consideration. 3. Conditional use permits without development plans are approvable by the director of planning. Conditional use permits with development plans are approvable by hearing body required for the development plan. 4. Major modifications of projects which were approved by the planning commission or city council shall be considered by the original approval body. Increases in building square footage that results in a building larger than 10,000 square feet shall be considered by the planning commission. Section 11. Severability. The City Council hereby declares that the provisions of this Ordinance are severable and if for any reason a court of competent jurisdiction shall hold any sentence, paragraph, or section of this Ordinance to be invalid, such decision shall not affect the validity of the remaining parts of this Ordinance. Section 12. Environmental Compliance. The City Council hereby finds that this amendment to the Temecula Municipal Code represents a series of minor changes mostly regulating the implementation of the zoning procedures and requirements that have no potential individually or cumulatively to impact the environment. As a result, the adoption of this ordinance is exempt from further environmental review pursuant to Section 15061 (b)(3) of the California Environmental Quality Act Guidelines. Section 13. Notice of Adoption. The City Clerk shall certify to the adoption of this Ordinance and shall cause the same to be posted as required by law. R:\DEVCODE~03-0109 Amendment\Ordinance to CC.doc 7 Section 14. Effective Date. This Ordinance shall be in full force and effect thirty (30) days after its passage. The City Clerk shall certify to the adoption of this Ordinance and cause copies of this Ordinance to be posted in three designated posting places. Section 15. This Ordinance shall be in full force and effect thirty (30) days after its passage; and within fifteen (15) days after its passage, together with the names of the City Council members voting thereon, it shall be published in a newspaper published and circulated in said City. PASSED, APPROVED AND ADOPTED this 13th day of May, 2003. Jeffrey E. Stone, Mayor ATTEST: Susan W. Jones, CMC City Clerk [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA ) I, Susan W. Jones, CMC, City Clerk of the City of Temecula, do hereby certify that the foregoing Ordinance No. 03- was duly introduced and placed upon its first reading at a regular meeting of the City Council on the __th day of __., 2003 and that thereafter, said Ordinance was duly adopted and passed at a regular meeting of the City Council on the __th day of ,2003, by the following vote: AYES: COUNCIL MEMBERS: NOES: COUNCILMEMBERS: ABSENT: COUNCIL MEMBERS: Susan W. Jones, CMC City Clerk R:\DEVCOD~03-0109 Amendment\Ordinance to CC.doc 8 ATDACHMENT NO. 2 PLANNING COMMISSION RESOLUTION R:\DEVCODE\03-0109 Amendment\Staff Report CC.doc 4 DRAFT PC RESOLUTION NO. 2003-015 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF TEMECULA RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE ENTITLED "AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES AND PROVIDE FOR THE READOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6" (PLANNING APPLICATION 03-0109) WHEREAS, on November 9, 1993, the City Council of the City of Temecula adopted the General Plan; and WHEREAS, on January 25, 1995, the City Council of the City of Temecula adopted the City's Development Code; and WHEREAS, the City has identified a need to amend the adopted Development Code; and WHEREAS, the Planning Commission, at a regular meeting, considered the amendment on March 19, 2003, at a duly noticed public hearing as prescribed by law, at which time the City staff and interested persons had an opportunity to, and did, testify either in support or opposition to this matter; NOW, THEREFORE, THE PLANNING COMMISSION OF THE CITY OF TEMECULA DOES HEREBY RESOLVE, DETERMINE AND ORDER AS FOLLOWS: Section 1. Recommendation of Approval. That the City of Temecula Planning Commission hereby recommends that the City Council approve the ordinance of the City Council of the City of Temecula amending 17 of the Temecula Municipal Code, substantially in the form attached to this resolution as Exhibit A. Section 2. Environmental Compliance. The Planning Commission hereby finds that this amendment to the Temecula Municipal Code represents a series of minor changes mostly regulating the implementation of the zoning procedures and requirements that have no potential individually or cumulatively to impact the environment. As a result, the adoption of this ordinance is exempt from further environmental review pursuant to Section 15061(b)(3) of the California Environmental Quality Act Guidelines. DRAFT R:\DEVCODE\03-0109 Amendment\PC RESOLUTION.doc PASSED, APPROVED AND ADOPTED by the City of Temecula Planning Commission this 19th day of March 2003. A'I-I'EST: Dennis Chiniaeff, Chairman Debbie Ubnoske, Secretary [SEAL] STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF TEMECULA I, Debbie Ubnoske, Secretary of the Temecula Planning Commission, do hereby certify that PC Resolution No. 2003-015 was duly and regularly adopted by the Planning Commission of the City of Temecula at a regular meeting thereof held on the 19t~ day of March 2003, by the following vote: AYES: 5 PLANNING COMMISSIONERS: NOES: 0 PLANNING COMMISSIONERS: ABSENT: 0 PLANNING COMMISSIONERS: ABSTAIN: 0 PLANNING COMMISSIONERS: Debbie Ubnoske, Secretary DRAFT R:\DEVCODE',03-0109 Amendment\PC RESOLUTION.doc A'I-fACHMENT NO. 3 PLANNING COMMISSION MINUTES R:\DEVCODE\03-0109 Amendment\Staff Report CC.doc 5 DRAFT Associate Planner Rush reviewed the staff report (of record), advising that in attendance and voicing no opposition as well as one amended condition of approval nos. 4d, 11,70, and 73 and the amended condition no. 18). At this time the public hearing. Mr. Larry R. Markham, 41635 reiterated concurrence with the revised condition. representing the applicant, )roval, including the amended At this time the public heari =losed. MOTION: added six moved to approve staff's the of approval, including the one amended page 7). Olhasso seconded the motion and voice vote reflected 'mous 9 Plannin.q Application No. PA03-0109 To amend the Development Code to do the followinq: define what a major and minor modification to a development plan is, clarify the application process for proiects requirin.q both a development plan and conditional use permit, authorize the adoption by reference of complicated Planned Development Overlay projects, create standards and procedures for Planned Residential Developments, clarify confusion conceminq the approval of si.qn proRrams as well as the allowable types, and duration of used for ambient balloons, update the approval authority table in Chapter 17.03 to conform to the other chanqes, Dave Hoqan, Principal Planner RECOMMENDATION: 9.1 Adopt a resolution entitled: PC RESOLUTION NO. 2003-015 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF TEMECULA RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE ENTITLED "AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES AND PROVIDE FOR THE READOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6" (PLANNING APPLICATION 03-0109) Principal Planner Hogan clarified the staff report (as per agenda material), highlighting the following: R: PlanComm/minutesJ031903 8 · CUP noticing requirements increased from 300' to 600'; Creation of minor and major modifications for Development Plans and CUPs; new fee schedule will be developed reviewing the various elements of each modification; · That minor and major modifications be administratively approved unless there were substantial changes which would require Planning Commission's approval; · Creation of a Planned Residential Development Element - varying zone standards on sites; · Planned Development Overlays (PDO) - adopted by specific reference; With regard to the provided information, it was the Planning Commission's recommendation to change the verbiage of the first bullet under Minor Modification as follows: an increase of less than 10% of the building footprint; and to request that all Major Modifications be forwarded to the Planning Commission for review. With regard to Section 2 A.2 (CUP for a Development Plan for a new building less than 10,000 square feet), Chairman Chiniaeff relayed his opposition with this section if it were to relate to the Liquor Store category with Principal Planner Hogan advising that this would not be a change of the current procedure and with Planning Director Ubnoske noting that the Planning Commission would review the need for public necessity or convenience. MOTION: Commissioner Mathewson moved to approve staff recommendation as amended: · Minor Modifications - an increase of less than 10% of the building footprint; · Major Modifications - to be forwarded for Planning Commission review. The motion was seconded by Commissioner Olhasso and voice vote reflected unanimous approval. '~OMI~SSION ERS' REPORTS ~ A. F~Olhasso, Director of Planning ~that Code Enf°rce~~a_dis°..~ Av.e~ u. e' . B. ~o Conflict of Interest as it relat~ voting abilities. ~ . C.. mented~ DRAFT R: PlanComm/minutes/031903 g ATTACHMENT NO. 4 PLANNING COMMISSION STAFF REPORT R:\DEVCODE\03-0109 Amendment\Staff Report CC.doc 6 STAFFREPORT-PLANNING CITY OF TEMECULA PLANNING COMMISSION March 19, 2003 RECOMMENDATION: Planning Application No. 03-0109 (Development Code Amendment) Prepared By: David Hogan, Principal Planner The Community Development Department - Planning Division Staff recommends the Planning Commission adopt a Resolution entitled: PC RESOLUTION NO. 2003- A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF TEMECULA RECOMMENDING THAT THE CITY COUNCIL ADOPT AN ORDINANCE ENTITLED "AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TEMECULA AMENDING CHAPTER 17 OF THE TEMECULA MUNICIPAL CODE TO CLARIFY THE PROCEDURES FOR MODIFYING APPROVED PERMITS, TO CREATE PROVISIONS TO ALLOW FOR PLANNED RESIDENTIAL DEVELOPMENTS, TO MAKE OTHER MINOR CHANGES AND PROVIDE FOR THE RE-ADOPTION OF PLANNED DEVELOPMENT OVERLAY NOS. 5 AND 6" (PLANNING APPLICATION 03-0109) BACKGROUND Staff has identified a number of potential changes to the Development Code. This proposed amendment would make the following changes to the Development Code: · Define what a major and minor modification to a development plan is, and clarify the application process for projects requiring both a development plan and conditional use permit. · Create standards and procedures of Planned Residential Development. · Authorize the adoption by reference for complicated Planned Development Overlay projects. · Clarify confusion concerning the approval of sign programs as well as the allowable types, and duration of use for ambient air balloons. · Update the approval authority table in Chapter 17.03 to conform to the other changes. ANALYSIS Modification to Development Plans in the process of working on the ongoing User Fee Study, staff has identified a need to create standards for both major and minor modifications to Development Plans. At present, there is no appropriate fee for a request to modify a development plan approval. The only options are to charge R:\DEVCODE\03-0109 Amendment\STAFFRPT PC.doc 1 a fee for a new development plan or take the application in as a Planning Department only, administrative development plan. To rectify this problem, staff is proposing to create two categories of modifications, Major and Minor. Examples of major and minor modifications are listed below. Major Modifications · Increasing the height of the building by more than 10 feet or one-story. · An increase of more than 10% of the building footprint. · A substantial change in the architecture of the building or substantial changes to the exterior elevations, including but not limited to the locations of windows or doors. · A modification in the approved access to the project site. · The shift of building location that effects the layout and location of the required parking or site access, or that substantially effects the site landscaping. A change in the number of primary structures. Modifications Minor · An increase of less than 10% or less of the building footprint. · A change in the layout of the parking or loading area. · The relocation of windows or doors on one or two wall surfaces. · An adjustment in the location of buildings provided the general location of each building is similar to the approved development plan. Modification subject to Planning Department staff review only (no staff review by other Departments is necessary.) · Changes to the approved landscaping plant palette. · Changes in exterior colors or materials. Another aspect in the Code area that needs clarification is the relationship between development plans and conditional use permits. At present, the Development Code indicates when a conditionally permitted business in a new building would require a conditional use permit (CUP) and development plan (DP). Both the CUP and DP address site layout and architecture issues, while the CUP would address the operational issues. This overlap has created confusion. An example of the potential confusion this overlap creates is found in some of our older conditional use permits. In processing the CUP, normal site layout and architecture issues were addressed. If the City revokes the conditional use permit, what would happen to these conditions? To keep this type of event from happening, this clarification would make it clear that access, site layout, landscaping, and architecture issues are addressed through the development plan and that special operational conditions and circumstances are addressed through the conditional use permit. This proposal would not change when a conditional use permit is required and will not alter the current approval authority contained in Table 17.03.010. Planned Residential Developments As the City gets closer and closer to build-out conditions, many of the more constrained and challenging sites are being proposed for development. Staff would like to create a simpler mechanism that would facilitate creative residential site designs while protecting local open spaces and ensuring neighborhood compatibility. R:\DEVCODE\03-0109 Amendment\STAFFRPT PC.doc 2 The proposed provisions would remove the minimum lot size requirements and setbacks. Each project would be able to be considered on its own merit. However, all planned residential developments would still have to comply with the following important factors: · The total number of units would not exceed the total number of units, based upon the density targets, indicated by the General Plan Land Use Map; · The project would still comply with the use provisions for the underlying residential zone; · Flexible site development standards would be used to protect open space and habitat areas; and · The Planning Commission would retain authority to approve the project. For example, a 10-acre site with a Low Density Residential zoning designation (1 -acre minimum lot size) would, under traditional zoning, be limited to 10 lots that are all at least 40,000 square feet in size. With the proposed planned residential development provisions, the property owner would still be limited to 10 units, however the applicant would concentrate all 10 units on a portion of the site and leave the remainder of the site undisturbed. These 10 units could be either be at a suburban density, small lot single family, or some form of attached residential product depending on the site, its particular location, and the character of the surrounding area. Other Changes The remaining changes involve clarifying the Sign Ordinance and the elimination of the reduced public hearing notice radius for conditional use permits in existing buildings. The current code does not clearly allow the use of holiday ambient air balloons during the Christmas season. This amendment would provide guidelines for how and when they could be used. This amendment would also cleady state that staff approves sign programs. These changes are contained in Sections 8 and 10 of the proposed ordinance. The final changes represent a minor change in how some of the Planned Development Overlays (PDO's) are approved. The detail and size of the two most recent PDO's, numbers 5 and 6, are very different from PDO's 1 through 4. This difference has made it difficult to incorporate the documents into the Development Code. As a result, staff is recommending that these two documents be removed from the Development Code and made freestanding ordinances in the manner that specific plans are freestanding documents. ENVIRONMENTAL DETERMINATION Staff has reviewed the proposed changes to the Development Code and has identified that the project has no potential to have an adverse impact on the environment. This amendment to the Temecula Municipal Code represents a series of minor changes mostly regulating the implementation of the zoning procedures and requirements and further clarifying the approval authority matrix and sign regulations. As result, staff is recommending that the Commission make a recommendation to the City Council that a no impact finding pursuant to Section 15061 (b)(3) of the California Environmental Quality Act Guidelines be made. Attachments PC Resolution - Blue Page 4 Draft Ordinance - Blue Page 7 R:\DEVCODE\03-0109 Amendment\STAFFRPT PC.doc 3 ITEM 32 APPROVAL ~,,) CITY A'I-I'ORNEY FINANCE OFFICER CITY MANAGER ClTY OFTEMECULA AGENDA REPORT DATE: TO: FROM: SUBJECT: May 13, 2003 City Manager/City Council Members John Meyer, Redevelopment Director.~~j~ Issuance of Bonds by the California Statewide Communities Development Authority for the Temecula Heritage Park Senior Living Senior Housing Project RECOMMENDATION: That the City Council adopt a Resolution entitled: RESOLUTION NO. 03-__ RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THE ISSUANCE OF MULTIFAMILY HOUSING REVENUE BONDS BY THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY DISCUSSION: American Senior Living, Heritage Community Housing Corporation and Sun America Affordable Housing Partners (Temecula Heritage Park) have formed a partnership known as Temecula Heritage Park. The partnership is proposing to develop 81 senior affordable rental-housing units. The project is located on the west side of Margarita Road between Dartola and De Portola Roads. The partnership is proposing to use tax-exempt bonds to finance the project. These bonds will be issued by the California Statewide Communities Development Authority (California Communities). California Communities is a statewide joint-powers authority sponsored by the California State Association of Counties and League of California Cities. California Communities is authorized to assist in the financing of multi-family affordable housing projects. Although California Communities (not the City or Agency) will be the issuer of the tax- exempt revenue bonds for the Sponsor, the financing cannot proceed without the City, as the governmental entity having jurisdiction over the site. approving of the Authority's R:~Housing 2003~American Sr Living Tefra JPA Report 051303.doc issuance of indebtedness. In order for the bonds to be issued, Federal and State law requires that the City must conduct a TEFRA (Tax Exempt Fiscal Responsibility Act, Internal Revenue Code of 1986) public hearing on the proposed financing. The purpose of the TEFRA hearing is to solicit public comments on the use of the tax- exempt bonds. Any comment received during the hearing will be forwarded to California Communities. Conducting the hearing in no way commits the City from approving or denying the proposed project. The proposed project is a private development with no financial assistance from the City of Temecula or its Redevelopment Agency. The project must still receive the necessary entitlements through the normal planning process. FISCAL IMPACT: There is no fiscal obligation or financial liability to the City or the Agency associated with the issuance of these bonds. Attachments: Resolution No. 03-__ (Tefra) RSHousing 2003~Amefican Sr Living Tefra JPA Report 051303.doc RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TEMECULA APPROVING THE ISSUANCE OF MULTIFAMILY HOUSING REVENUE BONDS BY THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY WHEREAS, the California Statewide Communities Development Authority (the "Authority") is authorized pursuant to the provisions of California Government Code Section 6500 et seq. and the terms of an Amended and Restated Joint Exemise of Powers Agreement, dated as of June 1, 1988 (the "Agreement"), among certain local agencies throughout the State of California, including the City of Temecula (the "City"), to issue revenue bonds in accordance with Chapter 7 of Part 5 of Division 31 of the California Health and Safety Code for the purpose of financing multifamily rental housing projects; and WHEREAS, American Senior Living, Inc. (collectively, with any related entity, the "Borrower") has requested that the Authority issue multifamily housing revenue bonds in an aggregate principal amount not to exceed $8,000,000 to finance an 81-unit senior affordable rental housing project located at 44155 and 44159 Margarita Road, Temecula, California, and generally known as Heritage Park at Temecula; and WHEREAS, the Bonds or a portion thereof will be "pdvate activity bonds" for purposes of the Internal Revenue Code of 1986 (the "Code"); and WHEREAS, pursuant to Section 147(f) of the Code, prior to their issuance, pdvate activity bonds are required to be approved by the "applicable elected representative" of the governmental units on whose behalf such bonds are expected to be issued and by a governmental unit having jurisdiction over the entire area in which any facility financed by such bonds is to be located, after a public hearing held following reasonable public notice; and WHEREAS, the members of this City Council (this "Council") are the applicable elected representatives of the City; and WHEREAS, there has been published, at least 14 days prior to the date hereof, in a newspaper of general circulation within the City, a notice that a public hearing regarding the Bonds would be held on the date hereof; and WHEREAS, such public hearing was conducted on said date by the City Council, at which time an opportunity was provided to interested parties to present arguments both for and against the issuance of the Bonds; and WHEREAS, it is intended that this resolution shall constitute the approval of the issuance of the Bonds required by Section 147(f) of the Code and Section 9 of the Agreement; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF TEMECULA AS FOLLOWS: Section 1. The above recitals are true and correct. DOCSSFl:656125.2 40929-199 Section 2. The Council hereby approves the issuance of the Bonds by the Authority. It is the purpose and intent of the Council that this resolution constitute approval of the Bonds for the purposes of (a) Section 147(f) of the Code and (b) Section 9 of the Agreement. Section 3. The officers of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents that they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this resolution and the financing approved hereby. Section 4. The City Clerk of the City shall forward a certified copy of this Resolution and a copy of the affidavit of publication of the hearing notice to' Justin Cooper, Esq. Orrick, Herrington & Sutcliffe LLP Old Federal Reserve Bank Building 400 Sansome Street San Francisco, California 94111 Section 5. This resolution shall take effect immediately upon its passage. DOCSSFl:656125.2 40929-199 AD1 2 ADOPTED by the City Council of the City of Temecula at a regular meeting of said Council held on the 13th day of May, 2003, by the following vote: AYES: NOES: ABSENT: ATTEST: Jeffrey E. Stone, Mayor Susan W. Jones, CMC City Clerk DOCSSFl:656125.2 40929-199 AD1 3 ITEM 33 APPROVAL CITY ATTORNEY DIRECTOR OF FINAI~E CITY MANAGER CITY OFTEMECULA AGENDA REPORT TO: FROM: DATE: ity Council hawn Nelson, City Manager May 13, 2003 SUBJECT: Redhawk Annexation Agreement RECOMMENDATION: That the City Council approve in substantial form the Redhawk Annexation Agreement No. I between the County of Riverside and the City of Temecula. BACKGROUND: In June, 2001, the City of Temecula entered a sales tax sharing agreement with the County of Riverside as it related to the annexation of Vail Ranch. In this agreement, the City and County agreed to share the sales tax revenues for the Redhawk Commercial area that includes the proposed Wal Mart on a 50/50 basis. It was agreed that this sales tax split would continue until the County repaid an obligation to Price Legacy for the restoration and commercial renovation of the Vail Ranch Historic Buildings. At that time, the City agreed that once the financial obligation for the sales tax reimbursement was repaid to Price Legacy, the City would consider the annexation of Redhawk within 12 months of that repayment. Subsequently, residents from Redhawk have petitioned the Riverside Local Formation Commission (LAFCO) for the City to annex the Redhawk community. The City has been concerned with this proposal because, based upon a financial analysis of the Redhawk annexation, the City would lose approximately $500,000 per year if only 50% of the sales tax revenues from the Redhawk Commercial area is allocated to the City. Recently, Supervisor Bob Buster and Dave Stahovich held a meeting with Mayor Jeff Stone and Mayor Pre Tem Mike Naggar to discuss a new annexation proposal. This proposal stated that if the City would agree to begin the annexation process for Redhawk with a target date of July 1, 2005, the County would provide the City $2.1 million from A.D. 159 to be utilized for median and other road improvements along the 79 South corridor; and approximately $700,000 from CSA 143 Fund Balance, that could be utilized for parks, street lighting, and slope improvements. This total $2.8 million would more than offset the potential loss of $2 to $2.5 million to provide services to Redhawk over the next four to five years until the sales tax reimbursement is fully repaid to the developer for the historic buildings. As a result, the City and County have prepared an agreement that identifies the main parameters for the annexation of Redhawk to proceed. These parameters include the following: The target date for the annexation is July 1, 2005, subject to voter approval of the annexation and related parcel charges. The City will not consider the annexation unless the Redhawk commercial area is projected to generate a minimum of $800,000 annually. For this to occur, the Wal Mart would have to be open and operational. The City/County would continue to split the sales tax revenues 50/50 from the Redhawk Commercial area until such time as the reimbursement to the developer of the historic buildings has been fully repaid. At such time, the City would then receive 100% of the sales tax revenues. The County will pay the City $2.1 million for median or other road improvements along the 79 south corridor; and $700,000 from CSA 143 Fund Balance to be utilized for park, street lighting and slope improvements prior to the annexation of Redhawk to the City. If this agreement is approved, staff will prepare an annexation schedule that will identify anticipated milestones including a voter approved election. FISCAL IMPACT: The costs associated with providing public services to Redhawk will be offset by the $2.8 million contribution from the County. With the approval of this agreement, the City will initiate the annexation of Redhawk, and budget $50,000 in next year's operating budget to cover the annexation application, consultant services, and election costs. ATTACHMENTS: Redhawk Annexation Agreement No. 1 REDHAWK ANNEXATION AGREEMENT NO. 1 BETWEEN THE COUNTY OF RIVERSIDE AND THE CITY OF TEMECULA (HISTORIC PRESERVATION AND SALES TAX ALLOCATION) THIS ANNEXATION AGREEMENT NO. 1 is dated and effective as of May 13, 2003 by and between the City of Temecula, a municipal corporation ("City") and the County of Riverside, a political subdivision of the State of California ("County"). In consideration of the mutual covenants and conditions set forth herein, the parties agree as follows: 1. Recitals. This Agreement is made with respect to the following facts and purposes, which each party hereto acknowledges as true and correct: a. The City has initiated proceeding to annex the Redhawk Area to the City of Temecula. The Redhawk Area is more particularly described on Exhibit A, attached hereto and incorporated herein as though set forth in full. b. The Redhawk Area is approximately 1,345 acres in area and consists of approximately 730 acres of residential and 69 acres ofcommemial property. c. The Redhawk Area contains six historic structures on a 4.0 acre parcel ("Historic Site"). The County and the owners of the Historic Site are obligated to rehabilitate and preserve these Historic Structures pursuant to a "Settlement Agreement" by and between MDC Vail, Explorer Insurance Company, and the County of Riverside. "Historic Structures" are defined in said agreement and the Environmental Impact Report for Specific Plan No. 223. The Historic Site is defined on Exhibit B, attached hereto and incorporated herein as though set forth in full. d. County and Price Legacy Corporation, the current owner of the Historic Site, have entered into an agreement entitled" "which is dated as of May 13, 2003 ("Price Legacy Agreement"). Pursuant to the Price Legacy Agreement, Price Legacy will lease the Historic Site to the County, and the County will sublease the Historic Site back to Price Legacy, with Price Legacy having the obligation to rehabilitate the Historic Structures and maintain them for the thirty (30) year term oftbe lease and sub-lease. Price Legacy will preserve the Historic Structures and integrate them into a commercial shopping center on the Historic Site. County's payment for the lease will be in an amount equal to filly percent (50%) of the sales tax revenues from the Redhawk Commemial Area described in Section 3 of this Agreement. A true correct and complete copy of the executed Price Legacy Agreement is attached as Exhibit C. e. As required by California law, City has caused a financial feasibility report to be prepared. The report indicates that the costs to the City of providing necessary public services to the Redhawk Area would be roughly equal cNelsons/Con-es 2003/Tern Redhawk Annex No. I (Sales Tax) 5-5-03 to the anticipated property taxes, sales taxes, and assessments anticipated to be levied upon the Redhawk Area. The financial obligation upon the County resulting from the Price Legacy Agreement committing a portion of the revenue received from the sales taxes to historic preservation would create a deficit of approximately $2 to $2.5 million between the revenues available in the Redhawk Area and the costs of providing necessary public services to the Redhawk Area. f. The purpose of this Annexation Agreement No. 1 is to ensure the financial feasibility of the annexation of the Redhawk Area to the City through mitigation measures which provide substantial community benefits for the City, County and the citizens of the Redhawk Area. 2. City Annexation Proceedings. Concurrently with the approval of this Annexation Agreement No. 1, the City commenced proceedings for the annexation of the Redhawk Area into the City of Temecula. City agrees to process the annexation diligently and in good faith with the goal of an effective date for the annexation of the Redhawk Area to the City of July 1, 2005. The parties acknowledge and agree that the annexation will not proceed unless and until: (1) The City conducts hearings on the proposed annexation as required by law and that nothing in this Annexation Agreement No. 1 is intended to, nor shall it be construed to, obligate the City to complete the annexation until such time, following all prescribed procedures, the City Council exercises its discretion and makes the findings required for annexation; (2) sales taxes from the Redhawk Area are projected by the City to equal or exceed eight hundred thousand dollars ($800,000.00) for the fiscal year proceeding annexation; and (3) the City conducts an election within the Redhawk area at which the voters approve all applicable City taxes and the rates and charges of the Temecula Community Services District in the manner required by law. 3. Sales Tax Allocation. Upon the effective date of the annexation of the Redhawk Area to the City of Temecula the sales taxes for the Redhawk Commercial Area shall be subject to the follow special allocation: a. The City shall receive one hundred percent (100%) of the sales taxes collected from establishments in the Redhawk Commercial Area, which area is defined on Exhibit D, and incorporated herein as though set forth in full. b. Within thirty (30) calendar days of receipt of the sales taxes l~om the Redhawk Area, City shall pay to the County a sum equal to fifty percent of the sales taxes actually received by the City from the Redhawk Commercial Area. County agrees to use said funds for the payment of its obligations under the Price Legacy Agreement only. County further agrees that any County default under the Price Legacy Agreement shall also constitute a default under this Annexation Agreement No. 1. c. City shall continue to make the payments described in subsection b. until: (1) the County's financial obligation under the Price Legacy Agreement is satisfied or the Agreement is otherwise terminated; or (2) the payments by the 2 r:N¢lsons~Corres 2003/Tern Redhawk Annex No. I (Sales Tax) 5-5-03 City to the County pursuant to Section 3.b. equal three million dollars ($3 million). d. Upon the occurrence of the events described in subsection c., the City shall retain one hundred percent (100%) of the sales tax revenues from the Redhawk Commercial Area. e. City shall spend an amount equal to the amount of sales tax actually received from the Historic Site for maintenance and preservation of the Historic Site. 4. County Responsibility for Price Le~,acv Agreement. County agrees that notwithstanding any provisions of law, upon the effective date of the Redhawk Annexation, the County shall maintain responsibility for the Price Legacy Agreement and City shall have no responsibility for the Price Legacy Agreement. 5. County Payment of Funds for Public Works Project Near the .Redhawk Area. In consideration of the City annexing the Redhawk Area to the City, the City assuming the responsibility of providing public services to the Redhawk Area, and in order to mitigate the loss of revenue for providing public services, the County agrees as follows: a. County shall pay to the City the sum of two million one hundred thousand dollars ($2,100,000.00) from the proceeds of bonds issued by Assessment District No. 159. The City shall use such funds for the Highway 79 South Median Project or another public works projects benefiting the Highway 79 South corridor. b. County shall pay to the City the stun of seven hundred thousand dollars ($700,00.00) from the County Service Area 143 fund balance. City shall use such funds for slope, street light, and park improvements. c. Payments shall be made on or before the effective date of the Redhawk Annexation. 6. LAFCO Proceedings. The terms of this Agreement shall be made conditions precedent to the completion of the annexation in the resolution of the Riverside County Local Agency Formation Commission approving the annexation of the Redhawk Area to the City. 7. Indemnification. a. County agrees to defend, indemnify, protect and hold harmless the City, its officers, officials, employees and vohmteers from and against any and all claims, demands, losses, defense costs or expenses, or liability of any kind or nature which the City, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property arising out of the County's negligent or wrongful ~N¢lsoas/Cor~s 2003/Tern Redhawk Annex No. 1 (Sales Tax) 5-5-03 acts or omissions in performing or failing to perform under the terms of this Agreement, excepting only liability arising out of the negligence of the City. b. City agrees to defend, indemnify, protect and hold harmless the County, its officers, officials, employees and volunteers from and against any and all claims, demands, losses, defense costs or expenses, or liability of any kind or nature which the County, its officers, agents and employees may sustain or incur or which may be imposed upon them for injury to or death of persons, or damage to property arising out of the City's negligent or wrongful acts or omissions in performing or failing to perform under the terms of this Agreement, or which may arise from the ownership of the Property, excepting only liability arising out of the negligence of the County. 6. Defaults and Remedies Subject to the extensions of time set approved in writing by a party, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. In addition, a default of the County under the Price Legacy Agreement shall constitute a default under this Annexation Agreement No. 1. A party claiming a default (claimant) shall give written notice of default to the other party, specifying the default complained of. b. The claimant shall not institute proceedings against the other party nor be entitled to damages if the other party within fourteen (14) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy within thirty (30) days from the date of receipt of such notice. Such cure, correction and remedy shall include payment of any costs, expenses (including attorney fees) or damages incurred by the non-defaulting party resulting fxom the default or during the period of default. c. Except as otherwise expressly stated in this Annexation Agreement No. 1, the rights and remedies of the parties are cumulative, and the exemise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. d. Any failures or delays by either party in asserting any of its rights and remedies as to any default shall not operate as a waiver of any defauk or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. e. If a default is not fully cured by tbe defaulting party as provided in this Paragraph, the defaulting party shall be liable to the other party for any damages caused by such default, and the nondefaulting party may 4 r Nelsons/Corms 2003/Tern Redhawk Almex No. 1 (Sales Tax) 5-5-03 thereafter (but not before) commence an action for damages against the defaulting party with respect to such default. f. If a default under this Agreement is not fully cured by the defaulting party as provided in this Paragraph, the nondefaulting party at its option may thereafter (but not before) commence an action for specific performance of terms of this Agreement. In addition, ifa default of the County is not cured prior to the effective date of the annexation of the Redhawk Area to the City, the City may elect not proceed with the completion of the Annexation. g. In the event litigation is filed by one party against the other to enforce its rights under this Agreemem, the prevailing party, as determined by the Court's judgment, shall be entitled to reasonable attorney fees and litigation expenses incurred in the action.. 7. Notices to Parties Written notices, demands and communications among the City and County, shall be sufficiemly given by either by (i) personal service, (ii) delivery by a reputable document delivery service, such as but not limited to, Federal Express, that provides a receipt showing date and time of delivery, or (iii) mailing in the United States Mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the party as set forth below or at any other address as that party may later designate by Notice: City: City of Temecula 43200 Business Park Drive Post Office Box 9033 Temecula, California 92589-9033 Attention: Shawn Nelson, City Manager County County Executive Officer County of Riverside 4080 Lemon Street, 12th Floor Riverside, Ca. 92501 8. Assignment. Neither Party shall assign or transfer this Agreement or any portion thereof without the prior written consent of the other party, which consent shall not be unreasonably withheld; provided however that either party may assign this Agreement to a related public emity without the consent of the other. 9. Sole and Only Agreement. This Agreemem constitutes the sole and only agreement between City and County respecting the matters comained herein, except that the parties acknowledge and agree the City of Temecula and the County have entered into the Master Property Tax Agreement between the City and the County. Any 5 r:Nels~Coaes 2003/Tern Redhawk Annex No. 1 (Sales Tax) 5-5-03 agreements or representations, either oral or written, respecting the matters discussed in this Agreement not expressly set forth in this Agreement are null and void. 10. of this Agreement. Time of Essence. Time is expressly declared to be of the essence 11. Authority to Execute. Each party hereto expressly warrants and represents that he or she has the authority to execute this Agreement on behalf of his or her governmental entity and warrants and represents that he or she has the authority to bind his or her entity to the performance of its obligations hereunder. IN WITNESS WHEREOF this Agreement has been executed by the authorized representatives of the parties hereto. CITY OF TEMECULA Jeffrey Stone Mayor Attest: Susan Jones, CMC City Clerk Approved as to form: Peter M. Thorson City Attorney 6 ~:Nelsons,'Con~s 2003/Tem Rcdhawk Annex No. 1 (Sales Tax) 5-5-03 COUNTY OF RIVERSIDE By: Chairman of the Board of Supervisors Attest: Gerald A. Maloney Clerk of the Board of Supervisors By: Deputy Clerk of the Board of Supervisors Approved as to Form: William Katzenstein County Counsel By: Joe S. Rank Deputy County Counsel 7 r:Nelsons/Corres 2003;rem Redhawk Annex No. 1 (Sales Tax) 5 4-03 EXHIBIT A REDHAWK ANNEXATION AREA 8 r:N~lsons/Corms 2003/Tern Redhawk Annex No. I (Sales Tax) 5-5-03 Exhibit "A" EXHIBIT B HISTORIC SITE 9 t:N¢lsons/Corres 2003/Tern Redhawk Annex No. 1 (Sales Tax) 5-5-03 Exhibit "B" EXHIBIT C PRICE LEGACY AGREEMENT 10 EXHIBIT D REDHAWK COMMERCIAL AREA 11 r:N¢lsons/Cotres 2003/Tern Redhawk Annex No I (Sales Tax) 5-5-03 Exhibit "D" ITEM 34 APPROVAL CITY A'FI'ORNEY "~/~'~ ~ DIRECTOR OFFINANCE CITY MANAGER ~/~-- TO: FROM: DATE: SUBJECT: CITY OFTEMECULA AGENDA REPORT City Manager/City Council Gary Thornhill, Deputy City Manage?'~''''' May 13, 2003 Citrus Vineyard Policy Area Proposed Up Zoning (Callaway) PREPARED BY: Stephen Brown, Principal Planner RECOMMENDATION: Provide direction to staff for further action BACKGROUND: Last month, Allied Domeq Wines proposed land use changes to the Board of Supervisors as a part of the County's General Plan update. The request was to change the designation on 814 acres to allow 2.5-acre residential lots. The proposed designation under the RCIP is Agricultural, 5-acre minimum lot size with the Citrus Vineyard Policy Overlay. The vintners and grape growers in the valley oppose this request; moreover, Mayor Stone prepared a letter in support of the Wine Growers Association position against the request to permit residential uses on 2.5-acre lots. The City's Economic Development Subcommittee met with the leadership of the Temecula Valley Winegrowers Association on April 28, 2003 to collaborate on a response to the threat to the wine country. The group came to a consensus on the following aspects of the issue: · Local, state and, federal funds totaling in the millions have been expended to combat Pierce's Disease. If Allied's request is granted, there is a good chance that all this money will have been spent with no real benefit to the local growers and the public. · Wine country is a success with more boutique wineries planning to locate here. · Riverside County is blessed to have the wine industry as it pumps $126 million into the economy each year. · Granting Allied's request could likely lead to the total failure of the wine industry in southwest Riverside County. The City's Economic Development Subcommittee directed staff to bring this issue forward to the full City Council for discussion and recommendation of further action. FISCAL IMPACT: None R:',BROWNS\R C I P\Citrus Vineyard CC Stafrpt 5-13-03.doc 1 ATI'ACHMENTS: Letter Dated March 14, 2003 to the Board of Supervisors - Blue Page 3 Letter Dated April 28, 2003 to the Board of Supervisors - Blue Page 4 Letter Dated May 6, 2003 from Jim Venable - Blue Page 5 R:\BROWNS\R C I P\Citrus Vineyard CC Stafrpt 5-13-03,doc 2 ATrACHMENT NO. 1 LETTER DATED MARCH 14, 2003 TO THE BOARD OF SUPERVISORS R:~ROWNS\R C I P\Citrus Vineyard CC Stafrpt 5-13-03.doc 3 of Temecula · Temecula, CA92590 · Mailing~ldress: P.O. Box 9033 · Temecula~ CA92589-9033 (909) 506-5100 · Fax (909) 694-6499 Jeffrey E. Stone Mayor Michael S. Naggar Mayor Pro-Tem Jeff Comerchero Councilmember Albert S. Pratt Councilmember Ronald H. Roberts Councilmember (909) 506-5100 FAX 694-6499 March 14, 2003 Board of Supervisors Riverside County County Administrative Center 4080 Lemon Street 5th Floor Annex Riverside, CA 92501 Subject: Citrus Vineyard Policy Area Honorable Chairman and Members of the Board: The City of Temecula was in attendance at the public hearing for the General Plan update on March 11,2003. We were quite surprised bythe testimony ofAIlied Domecq Wines USA and their request for two-acre Rural Community designation in the Citrus Vineyard Policy Area. The Cityagrees completely with Supervisor Buster that thewine country is one of the most precious resoumes in Riverside County. Our City Council is on record regarding the land uses in the wine country and surrounding areas in our letters to the County Planning Commission and your Board. The City of Temecula is opposed to any attempt to weaken the agricultural productivity of wine country by changing the Citrus Vineyard Policies and the Citrus Vineyard Zone. We also support the position of the Temecula Valley Winegrowers Association in their opposition to Allied Domecq's request for two-acre residential lots. Sincerely, Jeffery E. Stone Mayor CC: City Council Shawn Nelson, City Manager Gary Thornhill Deputy City Manager Richard Lashbmok, Director, TLMA Ron Goldman, Acting Planning Director Jerry Jolliffe, Deputy Planning Director R;cou ncil/correspondencedstone/stone2003/RCIP BOS Itt wine countt~ 3-144)3 ATTACHMENT NO. 2 LETTER DATED APRIL 28, 2003 TO THE BOARD OF SUPERVISORS R:~BROWNS\R C I P\Citrus Vineyard CC Stafrpt 5-13-03.doc 4 bcc: J. O'Grady G. Thornhill S. Brown City of Ternecula 43200 Bus~nes~ Park Drive Temecula, CA 92590 · iVbilingAddr~: P.O. Box 9033 · TemeoJla, CA 92589-9033 1909~ 694-6444 · Fa~ [909] 694-1999 April 28, 2003 Chairman John Tavaglione & Board Members Riverside County Board of Supervisors 4080 Lemon Street, 14th Floor P. O. Box 1147 Riverside, CA 92501-3655 Dear Chairman Tavaglione & Board Members: This letter is to outline our grave concern regarding the proposal of Allied-Domecq to rezone approximately 200 acres of land near the Callaway winery to residential uses, and to urge that you deny this and other requests that could diminish this premier winegrowing region. The City's Economic Development Subcommittee, consisting of Councilmembers Ron Roberts and Jeff Comerchero met with the President and Executive Director of the Temecula Valley Winegrowers Association this afternoon to discuss this proposal. Also attending were a number of the winegrowers and vintners, as well as representatives of the public. The Winegrowers as well as the Economic Development Subcommittee noted that: Millions of dollars of public funds have been invested in research and other pro.qrams to successfully combat the effects of Pierce's Disease. The County of Riverside, the City of Temecula, the State of California, as well as the Federal Government have collectively invested millions of dollars in recent years successfully battling this disease. This investment will be for naught if this land is simply converted to residential uses. The Wine Country is thrivin.q. A very informative article appeared in the Business section of yesterday's 'Press Enterprise' noting that the Temecula wine country is expanding. The article notes the success of the region and states that "With the investment of tens of millions of dollars for new winedes and a growing reputation as a winemaking region, Temecula's wine country is poised to attract more visitors and create hundreds of new jobs." The Wine Country is a critical element of the economic base of Riverside County and Temecula. A 1099 report by the University of California Cooperative Extension, Riverside County noted that the total economic value of the wine growing industry Chairman John Tavaglione & Board Members April 28, 2003 Page 2 was $126 million per year, and generated about 1,500 jobs. Furthermore, Riverside County, the City of Temecula, and the Cities of Murrieta and Lake Elsinore cooperate in an economic partnership known as the Southwest Riverside County Economic Alliance. Recently this partnership, in cooperation with the Winegrowers was a sponsor of a Bio Technology conference in San Diego. The Wine Country is an integral part of our mutual desire and cooperative efforts to bring quality jobs to Riverside County. Rezonin.q this land could likely lead to the demise of the wine country. We all realize the pressures for residential growth. If this up-zoning is approved, it will lead to further up-zoning requests, eventually destroying the viability of this unique and economically vital region. We are adamantly opposed to this proposed up-zone and request that you deny this and other requests to up-zone in the Temecula Valley Wine Country. This letter is being written at the request of the City's Economic Development Subcommittee, and the Temecula Valley Winegrowers Association. Please consider this and take any and all steps necessary to preserve, enhance, and protect this critical region. Shawn D. Nelson City Manager CC: Supervisors Ashley, Buster, Venable, and Wilson Brad Hudson, Riverside County EDA Temecula City Council Roberto Ponte and Linda Kissam, Temecula Valley Winegrowers Association ATTACHMENT NO. 3 LETFER DATED MAY 6, 2003 FROM JIM VENABLE R:\BROWNS\R C I P\Citrus Vineyard CC Stafrpt 5-13-03.doc 5 Y- 6-03 TUE 12:38 PM JIM VENABLE 4080 Lemon ~tr~ei, 14th Floor Milling AddF~s~ I.O.11o% 148§ ~v~e, CA 92S0~1~6 ~,:...: .~.Fi~(~)o~41~' : '.. ~, -.:~., :: ........ . Co~ oF P. 2 Mir,/Morel~ad Ken Gr~g /!hine JohmoR '~'" ', :' {!',',;".,t May 6, 2003 The Honorable Jeffrey E. Stone Mayor, City of Temecula 43200 Business Park Drive Temecula, CA 92590 Re: City Council Agenda Item, May 13, 2003 Citrus Vineyard Zone Dear Mayor Stone, The Riverside County Board of Supervisors listened to a request put before the Board at public hearings by Alliext-Domecq. This request was received into the minutes of the meeting to be given consideration as all other requests at those hearings. After those hearings I requested Allied-Domecq would present their request in more detail to area the affected land owners and specifically members of the Temecula Valley Wine Growers Association. I had two staffmembers present to hear that presentation. I support the continued economic viability and growth of the Wine Country resource adjoining the City of Temecula. I am supporting major improvements initiated to identify the Wine Country corridor of Rancho California Road, and I do not support any changes to increase any density within the Citrus Vineyard zone. Additionally please be aware that I not only do not support any change that would remove 800 acres from the Citrus Vineyard Zone but in fact I am supporting changes to the Citrus Vineyard Zone area that will increase it's size by approximately 1,000 acres. I appreciate your support in my efforts to protect and enlarge the Citrus Vineyard Zone and hope that your City Counsel will take some formal action to support my position. I regret that I will not bo able to attend the Council Meeting of May 13, 2003 but hope that you could relay my comments and position to your council, Sincerely, Hemct~ CA 92544 (90~) ?~1.,3t~00 · I~z (~09) 79!1-~610 Dcrll~zx: dlstrtet3~rcbos.o~g (90~) 461-~258 · Fax (909) 698-'/920