2022/05/18 Lennar Homes of California, LLC CFD No. 2022-1 Quartz Ranch and the City of Menifee Acquisition, Construction and Funding Agreement4863-2785-2828v3/200299-0009
COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE
ACQUISITION, CONSTRUCTION AND FUNDING AGREEMENT
THIS ACQUISITION, CONSTRUCTION AND FUNDING AGREEMENT (the
“Agreement”) is made and entered into by and between CITY OF MENIFEE (the “City”), acting for
and on behalf of itself and COMMUNITY FACILITIES DISTRICT NO. 2022-1 (QUARTZ RANCH)
OF THE CITY OF MENIFEE (the “Community Facilities District” or “CFD”) and LENNAR HOMES
OF CALIFORNIA, LLC, a California limited liability company (the “Developer”), each individually
a “Party” and collectively the “Parties.”
WHEREAS, Developer has requested that the City consider the formation of a community
facilities district pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982, as
amended (the “Act”), and undertake proceedings for the authorization of special taxes and issuance of
bonded indebtedness for the payment of the construction and/or acquisition of certain improvements
to be owned, operated or maintained by the City, Eastern Municipal Water District (the “Water
District”), Menifee Union School District (the “Menifee Union School District”), and Perris Union
High School District (the “Perris School District”), as well as overhead utility undergrounding
improvements required by the City as a condition of development (the “Utility Undergrounding”), and
incidental expenses in accordance with the Act; and
WHEREAS, in order to proceed in a timely way with development of its property within the
CFD which is described in the attached Exhibit “A” (the “Developer Property”), Developer desires to
fund through the Community Facilities District (i) the City’s acquisition or construction of certain
improvements that are to be owned, operated and maintained by the City or are otherwise required to
be constructed by the City (i.e., the Utility Undergrounding) (“City Improvements”), as more
particularly set forth and described in the Description of Cost Estimates attached hereto as
Exhibit “B,” (ii) improvements included in the City’s fee programs (the “City Fee Facility
Improvements”), as more particularly set forth and described in Exhibit “B,” and (iii) the
improvements of the Water District, the Menifee Union School District, and the Perris School District
described in Exhibit “C” hereto (the “Miscellaneous Improvements” and together with the City
Improvements and the City Fee Facilities Improvements, collectively the “Improvements”); and
WHEREAS, the City is authorized by the Act to form the CFD and to issue bonds secured by
Special Taxes (as defined in Section 2.2) of the CFD (the “Bonds”) to fund the Improvements; and
WHEREAS, the City Council has adopted the City’s policies and procedures concerning the
use of special district financing programs to finance the Improvements (the “Policy”); and
WHEREAS, the purpose of this Agreement is to constitute a formal understanding between
Developer and the City (pursuant to the requirements of Government Code Section 53313.51 and other
provisions of the Act and the Policy) concerning financial and other obligations and responsibilities
related to the formation of the Community Facilities District and the Improvements to be financed by
the Community Facilities District, when and if formed, to the extent funds are available, and to set
forth the conditions upon which (1) the Community Facilities District will reimburse Developer or its
designee for the cost of the City Improvements constructed by or on behalf of the Developer and (2) the
Community Facilities District will fund the City Fee Facility Improvements thereby satisfying
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corresponding City fees; and (3) the Community Facilities District will also fund the Miscellaneous
Improvements described in Exhibit “C.”
NOW, THEREFORE, it is mutually agreed between the respective Parties as follows:
1. Feasibility Study. The City has retained, at the Developer’s expense, the necessary
consultants to analyze the proposed formation of the CFD, including the special tax consultant, bond
counsel, and other consultants deemed necessary by the City. The Developer has advanced to the City
a sum of money for such costs, all or a part of which may be eligible for reimbursement from the CFD
in accordance with the Reimbursement Agreement dated as of April 1, 2022 (the “Reimbursement
Agreement”) between the Developer and the City.
2. Sale of Bonds.
2.1 City Policies. The City Council has adopted the Policy, setting forth the City’s
policies and procedures concerning the use of special district financing programs to finance the
Improvements. Pursuant to the Policy, the total annual amount of the special taxes to be collected with
respect to a parcel within the CFD and all other taxes and assessments which will be collected with
respect to such parcel from the secured tax roll must not exceed two percent (2%) of the Fair Market
Value (as defined in the Policy) of such parcel at the time of CFD formation.
The Parties hereby agree that, unless waived by the City, at the time of issuance of the Bonds,
the ratio of the value of all parcels of property for which the Bonds are being issued to the amount of
outstanding community facilities district or assessment district bonds attributable to such parcels (the
“Value-to-Lien Ratio”) may not be less than four-to-one (4:1). Unless waived by the City, the Fair
Market Value of the property within the Community Facilities District for purposes of determining the
foregoing ratio will be determined based on the appraised value of the property based on the appraisal
made by an appraiser selected by the City with a valuation date within three (3) months of the issuance
of the Bonds, or, with respect to developed projects (as determined in the sole discretion of the City)
or issuance of refunding bonds, the assessed value of the property, or some combination thereof.
Subject to satisfaction of the Policy and the requirements of this Agreement, the City shall use
reasonable efforts to issue and sell the Bonds in one or more series in an amount sufficient to fund the
Improvements in accordance with the schedule for development of the Developer Property. The
ultimate decision as to issuance and sizing lies in the sole legislative discretion of the City.
2.2 Security for Payment of Special Taxes.
(a) Concurrently with the issuance and sale of each series of the Bonds, the owner
of any land within the Community Facilities District which the City has determined, in its sole
discretion, to use in the sizing of such series of Bonds (the “Sizing Property”), together with any Sizing
Property owned by any affiliate (collectively, an “Account Party”), for which the Maximum Special
Taxes for the then-current fiscal year (as defined in the Rate and Method of Apportionment of Special
Tax for the Community Facilities District (the “Rate and Method”) and such Special Tax referred to
herein as the “Special Tax” or “Special Taxes”), are equal to or exceed 20% of the aggregate Maximum
Special Taxes authorized to be levied on the Sizing Property in such fiscal year, shall deliver to the
City either (i) a renewable irrevocable instrument of credit from a financial institution (rated “A” or
better) and approved by the City, or (ii) cash in-lieu thereof (a “Security”). The Security shall be in an
amount equal to 200% of the product of the maximum annual debt service on the Bonds proposed to
be issued times a fraction the numerator of which is the aggregate Maximum Special Taxes on the
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Sizing Property in the then current fiscal year applicable to the land owned by the Account Party and
the denominator of which is the total Maximum Special Taxes applicable to all of the Sizing Property
in such fiscal year (the “Stated Amount”). The Security shall be maintained by the Account Party in
each fiscal year until terminated in accordance with Section 2.2(c) below. While the Security is still
required the Stated Amount of such Security shall be reduced as set forth in a Certificate of Reduction
or Termination (as defined in Section 2.2(c) below).
The Security shall name the Fiscal Agent as a beneficiary and shall provide that the Fiscal
Agent may draw an amount equal to any delinquencies in payment of semiannual installments of the
Special Taxes levied on property owned by the Account Party in the Community Facilities District.
The total amount to be drawn under the Security shall not exceed an amount equal to the Special Taxes
owed by the Account Party with respect to property within the Community Facilities District that is
delinquent at the time the draw is made. The amount drawn on the Security shall be applied in the
same manner and for the same purposes as the delinquent Special Taxes would have been applied;
provided, however the payment of a draw under the Security will not be deemed to cure the
delinquency in payment of the Special Taxes.
If, subsequent to a draw on the Security and prior to the satisfaction of any reimbursements
due to the institution providing the Security (the “Security Provider”) pursuant to this Agreement, the
City receives payment of all or a portion of the delinquent Special Taxes or the proceeds of a sale of
delinquent real property pursuant to foreclosure proceedings (“Delinquency Proceeds”) for a parcel for
which the Security has been drawn, the Security Provider (or its designee, which may be the Developer)
shall be reimbursed for such draws to the extent of Delinquency Proceeds net of the City’s costs of
collection. The Security Provider is intended by the Parties to be a third party beneficiary of this
Section 2.2.
(b) The Security shall be renewed, or a substitute Security reasonably satisfactory
to the City (a “Substitute Security”) provided, not less than thirty (30) calendar days prior to the
expiration of the Security or Substitute Security then in effect. If the Account Party provides a
Substitute Security to the City, then the Fiscal Agent shall return any existing Security on the effective
date of the Substitute Security to the Security Provider.
If the Security is not renewed within thirty (30) days prior to its expiration date and the
requirements for release or termination of the Security as set forth in Section 2.2(c) below have not
then been met, the full amount of the Security may be drawn by the Fiscal Agent and deposited in an
account established under the Indenture (as hereinafter defined) or in such account established with a
financial institution selected by the City. Thereafter, amounts in such account shall be held as security,
and if Special Taxes owed by the Account Party with respect to property within the Community
Facilities District are not paid prior to delinquency, then such amounts in such account may be applied
by the City to pay the delinquent Special Taxes owed by the Account Party with respect to such
property on the same terms and conditions applicable hereunder to draws on the Security.
At such time as the Security is renewed, or a Substitute Security is accepted by the Fiscal
Agent, or the requirement for the Security has been terminated pursuant to this section, the City or its
designee, shall release all amounts in the Security account to the Security Provider (or its designee,
which may be the Developer) within ten (10) calendar days from the date of renewal or acceptance.
(c) Following the sale or transfer by the Account Party of any property to a person
other than the Account Party, or upon the prepayment of the Special Tax obligation for a parcel owned
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by the Account Party, the Account Party shall notify the Community Facilities District of such event,
in writing, and, if requested by the Account Party, the Stated Amount of the Security shall be reduced
and be recalculated in accordance with this Section 2.2; provided, however, that any costs associated
with the recalculation and reduction shall be borne by the Account Party. Subject to Section 2.2(d)
below, the Stated Amount may be reduced to an amount equal to 200% of the product of the maximum
annual debt service on the outstanding Bonds times a fraction the numerator of which is the aggregate
Maximum Special Taxes applicable to the Sizing Property owned by the Account Party and the
denominator of which is the total Maximum Special Taxes to all of the Sizing Property as of the date
of calculation. The Security shall be terminated when the Account Party has paid all Special Taxes in
the current fiscal year and the Sizing Property owned by the Account Party is expected to be responsible
for less than 20% of the Maximum Special Taxes in the next fiscal year.
Reduction or termination of a Security shall occur automatically upon submission to the
Security Provider by the Fiscal Agent of a “Certificate of Reduction or Termination” upon valuation
of the Certificate of Reduction or Termination by the City. The City shall direct that the Fiscal Agent
deliver to the Security Provider such Certificate of Reduction or Termination promptly upon receiving
from the Account Party a certification which shall be made under penalty of perjury and which shall
indicate (i) the legal description of all Sizing Property owned by the Account Party, and either (ii) a
recalculation of the new Stated Amount that the Account Party proposes be applicable to the Security
or (iii) if termination of the Security is requested, a statement that one of the requirements set forth in
the preceding paragraph for termination of the Security has been satisfied.
The Account Party shall notify the City of any events that will result in a reduction of the Stated
Amount of the Security and shall provide the City with verification of said events. The Account Party
may provide the Fiscal Agent with a Substitute Security in the reduced amount, and the Fiscal Agent
shall release and return to the Security Provider the Security then in effect. The Parties expressly
acknowledge that the Account Party’s failure to so notify the City or to reduce the Security at the times
prescribed herein shall in no way effect or invalidate sale or transfer of property, or recordation of
maps on property.
(d) If the Sizing Property is sold or transferred by an Account Party with the result
that the Sizing Property owned by the transferee or any of its affiliates (“Transferee”) is responsible
for 20% or more of the aggregate Maximum Special Taxes of all Sizing Property, a Security on the
same terms specified in Section 2.2(a) above will be furnished by Transferee with respect to all land
owned by such Transferee with respect to the Sizing Property. Any applicable purchase and sale
agreement and/or escrow instructions shall notify the Transferee of this Security requirement and
obligate the Transferee to provide such Security, if applicable. The Security of the Account Party will
not be reduced to reflect the sale or transfer of such Sizing Property until a Security is furnished by the
Transferee and accepted by the Fiscal Agent. The issuing financial institution and the form and terms
of said Security will be subject to reasonable prior approval by the City. All terms provided in this
Section 2.2 are applicable to the Transferee by replacing the term “Account Party” at each place where
it occurs in each section with the term “Transferee.” Each provider of a Security for a Transferee shall
be an express third party beneficiary of the provisions of this Section 2.2.
Any costs related to the holding or maintaining the Security, including any fees of a fiscal
agent, trustee or other depository shall be borne by the Account Party.
2.3 Major Landowner Initial and Continuing Disclosure. An owner of land
which is responsible for twenty percent (20%) or more of the Maximum Special Taxes applicable to
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the Sizing Property in the fiscal year in which the Bonds are issued or in the fiscal year following the
fiscal year in which the Bonds are issued (a “Major Landowner”) will be required to provide all
information regarding the development of its property, including the financing plan for such
development, which is necessary to ensure that the official statement for such Bonds complies with the
requirements of Rule 15c2-12 of the Securities and Exchange Commission (the “Rule”) and all other
applicable federal and state securities laws. Additionally, Developer acknowledges that, if it is a Major
Landowner at the time of issuance of the Bonds, it will be necessary that Developer enter into a
continuing disclosure agreement to provide such continuing disclosure pertaining to the development
of the land owned by Developer within the CFD to assist in the marketing of the Bonds
2.4 Bond Issuance Parameters. The terms and conditions upon which each series
of the Bonds shall be issued and sold, the method of sale of the Bonds and the pricing of the Bonds
shall be determined solely by the City in its legislative discretion in conformance with the Act, the
Policy, and this Agreement. Each series of Bonds shall be issued with a term not to exceed 35 years
from the date of issuance of the Bonds. The proceeds of the Bonds shall be used in the following
priority to (1) fund a reserve fund for the payment of principal and interest with respect to the Bonds
in an amount equal to the least of (i) ten percent (10%) of the total bond issue, (ii) maximum annual
debt service on Bonds, or (iii) 125% of average annual debt service; (2) fund capitalized interest
through the interest payment date on the Bonds for which Special Taxes are not available for payment
of debt service on the Bonds or such longer period as requested by the Developer and approved by the
City, subject to the Act; (3) reimburse the Developer or its designee pursuant to Section 1 hereof for
CFD formation costs advanced by the Developer pursuant to the Reimbursement Agreement which
have not already been reimbursed to the Developer from collected Special Tax; (4) pay for costs of
issuance of the Bonds including, without limitation, underwriter’s discount, bond counsel and
disclosure counsel fees, appraisal and special tax consultant fees, printing, fiscal agent fees, and
reasonable Developer legal and financial consultant costs; (5) pay for the costs of forming the
Community Facilities District; and (6) pay for the actual costs of the Improvements. The Community
Facilities District shall maintain records relating to the disbursements of proceeds of the sale of the
Bonds. The Indenture or Resolution or Fiscal Agent Agreement (hereinafter “Indenture”) for the
Bonds shall establish an acquisition and construction fund or improvement fund (herein, the
“Improvement Fund”) to be held by the fiscal agent (“Fiscal Agent”) into which shall be deposited
initially the proceeds of the Bonds net of the amount of proceeds required to fund items (1) through
(5) in the second preceding sentence. The Indenture shall also establish separate accounts of the
Improvement Fund designated the “City Improvements Account,” “City Fee Facility Improvements
Account,” and any Miscellaneous Improvement Account(s) for the Miscellaneous Improvements
described in Exhibit “C,” into which shall be deposited such portions of the Improvement Fund as
agreed by the Parties and directed by the City in writing at or subsequent to the closing of the sale of
the Bonds consistent with the following priorities:
(a) An amount sufficient to fund the reasonable, current estimated cost of the City
Fee Facility Improvements anticipated to be funded out of the Bonds being issued shall be deposited
in the City Fee Facility Improvements Account (any Special Taxes levied in the CFD and collected by
the CFD remaining after the payment of administrative expenses of the CFD and the reimbursement
of the Developer for CFD formation costs pursuant to Section 1 hereof shall be deposited into the City
Fee Facility Improvements Account at the time of Bond issuance, unless otherwise directed in writing
by the Developer);
(b) If applicable, an amount to be agreed upon between Developer and the CFD
prior to the issuance of Bonds sufficient to fund the reasonable, current estimated costs of the City
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Improvements (including the Utility Undergrounding) shall be deposited, or later transferred, to the
City Improvements Account; and
(c) If applicable, an amount to be agreed upon between Developer and the CFD
prior to the issuance of Bonds sufficient to fund the reasonable, current estimated cost of the
Miscellaneous Improvements described in Exhibit “C” hereto, anticipated to be funded out of the
Bonds being issued shall be deposited, or later transferred, to the applicable Miscellaneous
Improvement Account(s).
Interest earned on moneys deposited in each of the City Fee Facility Improvements Account,
the City Improvements Account and the Miscellaneous Improvement Account(s) shall remain in such
accounts until such time as all of the Improvements have been funded. Additionally, the Developer
may direct the CFD to transfer excess moneys in any of the City Fee Facility Improvements Account,
the City Improvements Account or the Miscellaneous Improvement Account(s) to another Account.
The Indenture shall provide that amounts remaining in the Improvement Fund after funding all
proposed Improvements (such completion of funding to be agreed by the City and the Developer) shall
be deposited in the special tax fund or bond service fund and be applied to pay debt service on the
Bonds and/or to call Bonds in advance of maturity.
3. Allocation of Special Taxes. Prior to the issuance of Bonds, the City Council of the
City, acting as the legislative body of the Community Facilities District, may levy Special Taxes on all
parcels classified as Developed Property pursuant to the Rate and Method. Such Special Taxes
collected by the City shall first be applied to fund annual administrative expenses of the Community
Facilities District and then to fund Improvements in the same manner as the proceeds of Bonds as set
forth herein. Upon sale and delivery of the Bonds, the City shall annually levy the Special Tax as
provided for in documents pursuant to which the Bonds were issued. Following the issuance of the
last series of Bonds, the City shall have no obligation to levy Special Taxes to reimburse the Developer
for the costs of any Improvements not paid for from Bond proceeds.
4. Notice of Special Tax. Developer shall provide written notice to all potential initial
purchasers of lots advising of the special tax obligation applicable to the Developer Property in the
form required by Section 53341.5 of the Government Code.
5. Design Plans and Specifications. The requirements of this Section shall not apply to
any City Improvement that was complete (as determined by the City Council) prior to the adoption by
the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
All plans, specifications and bid documents for the City Improvements (“Plans”) constructed or to be
constructed by the Developer shall be prepared by the Developer at the Developer’s initial expense,
subject to approval by the applicable public agency. Costs for preparation of the Plans will be eligible
for reimbursement, conditioned upon the final approval of the applicable public agency and the
availability of funds. Reimbursement of costs for plan revisions will be considered on a case by case
basis. All facilities shall be bid in accordance with “public works” requirements of Section 7 to be
eligible for reimbursement.
6. Construction of Improvements. The requirements of this Section shall not apply to
any City Improvement that was complete (as determined by the City Council) prior to the adoption by
the City Council of the resolution forming the CFD, but they shall apply to all other City Improvements.
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6.1 Acquisition of City Improvements. Upon the approval of Plans for a City
Improvement, the Developer Developer will provide for construction of such City Improvement in
accordance with Sections 6.2 and 7 of this Agreement. Sections 6.2 and 7 specify the requirements for
construction of the City Improvements that the City believes are necessary to ensure that such City
Improvements are constructed as if they had been constructed under the direction and supervision, or
under the authority of the City.
6.2 Acquisition. With respect to City Improvements, a qualified engineering firm
(the “Field Engineer”) shall be employed by the Developer to provide all field engineering surveys
determined to be necessary by the City’s inspection personnel. Field Engineer shall promptly furnish
to City a complete set of grade sheets listing all locations, offsets, etc., in accordance with good
engineering practices, and attendant data and reports resulting from Field Engineer’s engineering
surveys and/or proposed facility design changes. City shall have the right, but not the obligation, to
review, evaluate and analyze whether such results comply with applicable specifications.
As necessary as determined by City, a full-time soil-testing firm, approved by City, shall be
employed by the Developer to conduct soil compaction testing and certification. The Developer shall
promptly furnish results of all such compaction testing to the City for its review, evaluation and
decision as to compliance with applicable specifications. In the event the compaction is not in
compliance with applicable specifications, the Developer shall be fully liable and responsible for the
costs of achieving compliance. A final report certifying all required compaction in accordance with
the specifications shall be a condition of final approval of facilities.
The costs of all surveying, testing and reports associated with the City Improvements furnished
and constructed by the Developer’s contractor(s) shall be eligible to be paid from funds in the City
Improvements Account.
The City shall not be responsible for conducting any environmental, archaeological, biological,
or cultural studies or any mitigation requirements that may be requested by appropriate Federal, State,
and/or local agencies. Any such work shall be paid for and conducted by the Developer and reimbursed
out of the City Improvements Account.
Should the Developer notify the City that the Developer is unable to complete such City
Improvement, the City shall have the right but not the obligation to require the Developer to make an
irrevocable offer of dedication to the City of the land owned by the Developer for the City Improvement
identified in the notice and to assume responsibility for the work to be performed thereunder. In the
event the City elects to assume the responsibility for any work on a previously awarded contract as
described in the preceding sentence, the following will occur: (i) the Developer will make an
irrevocable offer of dedication to the City of the land owned by the Developer for such City
Improvement identified in the notice; (ii) to the extent permitted by law and the applicable contract,
the Developer will assign all of the contracts for the work performed to date on the City Improvement
identified in the notice to the City, if requested to do so by the City Manager; the City will use its best
efforts to complete the City Improvement within a reasonable time frame; and upon completion of the
City Improvement, to the extent there are Special Taxes or proceeds of the Bonds available following
payment to the City for the costs of completing such City Improvement, the Developer will be
reimbursed for the lesser of the cost or value of the previously unreimbursed satisfactory work
performed or paid for by the Developer. The cost of such work will be determined by taking the
unreimbursed amounts expended by the Developer under the contract(s) taken over by the City and
deducting any incremental cost incurred by the City to complete the work under the contracts in
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question. Incremental cost shall be costs in excess of the sum of the original contract cost plus change
orders approved by the City.
7. Public Works Requirements.
7.1 City Requirements. In order that the City Improvements may be properly and
readily acquired by the City, the Developer shall comply with all of the requirements in this Section
7.1 with respect to any such City Improvements to be acquired with funds in the City Improvements
Account and the Developer shall provide such proof to the City as the City may reasonably require and
at such intervals and in such form as the City may reasonably require, that the requirements under this
Section 7.1 have been satisfied as to all such City Improvements. Notwithstanding the foregoing, City
Improvements shall only be eligible for financing by the CFD if the City determines that the conditions
under Section 53313.5 have been satisfied with respect to such City Improvements.
(a) The Developer shall prepare a bid package for review, comment and approval
by the City Manager or his designee (the “City Representative”) for any City Improvements bid after
the effective date of this Agreement.
(b) For any City Improvements bid after the effective date of this Agreement, the
Developer shall, after obtaining sealed bids for the construction of the City Improvements in
conformance with the procedures and requirements of the City, submit to the City written evidence of
such competitive bidding procedure, including evidence of the means by which bids were solicited, a
listing of all responsive bids and their amounts, and the name or names of the contractor or contractors
to whom the Developer proposes to award the contracts for such construction, which shall be the lowest
responsible bidder.
(c) For any City Improvements bid after the effective date of this Agreement, the
following provisions apply: the City Representative shall attend the bid opening for such City
Improvements. If unable to attend the bid opening, the City Representative shall approve or disapprove
of a contractor or contractors, in writing, within five (5) business days after receipt from the Developer
of the name or names of such contractor or contractors recommended by the Developer. If the City
Representative disapproves of any such contractor, the Developer shall select the next lowest
responsible bidder from the competitive bids received who is acceptable to the City Representative.
(d) The specifications and bid and contract documents shall require all such
contractors to pay prevailing wages and to otherwise comply with applicable provisions of the Labor
Code, the Government Code and the Public Contract Code relating to public works projects and as
required by the procedures and standards of the City with respect to the construction of its public works
projects.
(e) The Developer shall submit faithful performance and payment bonds in form
and substance reasonably acceptable to the City with respect to the City Improvements.
(f) The Developer and its contractor and subcontractors shall be required to
provide proof of insurance coverage throughout the term of the construction of the City Improvements,
which they will construct in conformance with the City’s standard procedures and requirements. The
City’s insurance requirements are set out in Section 20 herein.
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(g) The Developer and all such contractors shall comply with such other
requirements relating to the construction of the City Improvements which the City may impose by
written notification delivered to the Developer and each such contractor at the time either prior to the
receipt of bids by the Developer for the construction of such City Improvements or, to the extent
required as a result of changes in applicable laws, during the progress of construction thereof; provided
that such other requirements shall only be imposed to the extent the City reasonably determines they
are required in order to comply with applicable law. In accordance with Section 7, the Developer shall
be deemed the awarding body and shall be solely responsible for compliance and enforcement of the
provisions of the Labor Code, Government Code, and Public Contract Code.
(h) A “Change Order” is an order from the Developer to a contractor authorizing
a change in the work to be performed and a “Significant Change Order” is an order from the Developer
to a contractor authorizing a change in the work to be performed where such Change Order is larger
than 10% of the contract amount for such City Improvement. After the effective date of this
Agreement, the Developer shall receive comments from the City Representative prior to the
Developer’s approval of any Significant Change Order. The City Representative shall comment on or
deny the Significant Change Order request within fifteen (15) business days of receipt of all necessary
information. The City’s comments to a Significant Change Order shall not be unreasonably delayed,
conditioned or withheld. The Developer shall not be entitled to be compensated for costs associated
with a Significant Change Order that has not been approved by the City Representative.
Developer shall provide proof to the City, at such intervals and in such form as the City may
reasonably require, that the foregoing requirements have been satisfied as to all of the City
Improvements which are funded through Bond proceeds.
8. Inspection; Completion of Construction. The requirements of this Section shall not
apply to any City Improvement that was complete (as determined by the City Council) prior to the
adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City
Improvements.
The City shall have primary responsibility for inspecting the City Improvements to assure that
the work is being accomplished in accordance with the Plans. Such inspection does not include
inspection for compliance with safety requirements by the Developer’s contractor(s). The City’s
personnel shall be granted access to each construction site at all reasonable times for the purpose of
accomplishing such inspection. Upon satisfaction of the City’s inspectors, the Developer shall notify
the City in writing that a City Improvement has been completed in accordance with the Plans. Any
actual costs reasonably incurred by the City for inspection not previously paid by the Developer shall
be reimbursed from funds in the City Improvements Account.
Within three (3) business days of receipt of written notification from City inspectors that a City
Improvement has been completed in accordance with the Plans, the City Representative shall notify
the Developer in writing that such City Improvement has been satisfactorily completed. Upon
receiving such notification, the Developer shall file a Notice of Completion with the County of
Riverside Recorders Office, pursuant to the provisions of Section 3093 of the Civil Code. The
Developer shall furnish to the City a duplicate copy of each such Notice of Completion showing
thereon the date of filing with the County of Riverside (the “County”). City will in turn file a notice
with the County for acceptance.
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9. Liens. With respect to any City Improvement that was complete (as determined by the
City Council) prior to the adoption by the City Council of the resolution forming the CFD, prior to any
payment by the CFD to the Developer for such City Improvement, the Developer shall provide to the
City such evidence or proof as the City shall require that all persons, firms and corporations supplying
work, labor, materials, supplies and equipment for the construction of the City Improvements have
been paid, and that no claims of liens have been recorded by or on behalf of any such person, firm or
corporation. With respect to City Improvements, upon the earlier of (i) receipt of all applicable lien
releases, or (ii) expiration of the time for the recording of claim of liens as prescribed by Sections 3115
and 3116 of the Civil Code the Developer shall provide to the City such evidence or proof as the City
shall require that all persons, firms and corporations supplying work, labor, materials, supplies and
equipment for the construction of the City Improvements have been paid, and that no claims of liens
have been recorded by or on behalf of any such person, firm or corporation.
10. Acquisition; Acquisition Price; Source of Funds. The acquisition price of a City
Improvement that was complete (as determined by the City Council) prior to the adoption by the City
Council of the resolution forming the CFD shall be its fair market value, as determined by the City’s
Assistant General Manager or his or her designee, as of the date of acquisition. The City shall consider
input and data provided by the Developer prior to determining the final fair market value. The Actual
Cost (as defined below) of the City Improvement shall be presumed to be its fair market value unless
there is reasonable evidence that a lower amount is the fair market value.
The costs eligible to be included in the acquisition price of a City Improvement that is not
described in the preceding paragraph (the “Actual Costs”) shall include:
(i) The actual hard costs for the construction of such City Improvement as
established by the City-approved construction contracts, Change Orders, and approved Significant
Change Orders, including costs of payment, performance and maintenance bonds and insurance costs,
pursuant to this Agreement;
(ii) The design and engineering costs of such City Improvement including,
without limitation, the costs incurred in preparing the Plans;
(iii) The costs of environmental evaluations and public agency permits and
approvals attributable to the City Improvement;
(iv) Costs incurred by the Developer for construction management and
supervision of such City Improvement, not to exceed five percent (5%) of the actual construction cost;
(v) Professional costs associated with the City Improvement such as
engineering, inspection, construction staking, materials, testing and similar professional services; and
(vi) Costs approved by the City in accordance with the Act of acquiring any
real property or interests therein required for the City Improvement including, without limitation,
temporary construction easements, temporary by-pass road and maintenance easements.
Provided the Developer has complied with the requirements of this Agreement, the City agrees
to pay the acquisition price of a completed City Improvement to the Developer or its designee within
thirty (30) days after the Developer’s satisfaction of the preconditions to such payment stated herein,
but only to the extent there are sufficient funds available in the City Improvements Account. Except
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in the case of a City Improvement described in the first paragraph of this Section, the acquisition price
to be paid from Bond proceeds for the acquisition of a City Improvement by the City shall be the least
of (1) the value of the City Improvement; or (2) the total of the Actual Costs of the City Improvement
(“Acquisition Price”). The Actual Cost of the City Improvement shall be presumed to be its
Acquisition Price unless there is reasonable evidence that a lower amount is the actual value.
As a condition to the payment of the Acquisition Price, the ownership of the completed City
Improvement shall be transferred to the City by grant deed, bill of sale or such other documentation as
such public agency may require free and clear of all taxes, liens, encumbrances, and assessments, but
subject to any exceptions determined by the City to not interfere with the actual or intended use of the
land or interest therein (including the lien of a community facilities district so long as the subject
property is exempt from taxation or is otherwise not taxable by such community facilities district).
Upon the transfer of ownership of City Improvements or any portion thereof to the City, the City shall
be responsible for the maintenance of such City Improvements or the portion transferred.
Notwithstanding the foregoing, the Acquisition Price of a City Improvement may be paid prior to
transfer of ownership and acceptance of the City Improvement if it is substantially completed at the
time of payment. The City Improvement shall be considered “substantially complete” when it has been
reasonably determined by the City to be usable, subject to final completion of such items as the final
lift or any other items not essential to the primary use or operation of the City Improvement.
For purposes of determining the Acquisition Price to be paid by the Community Facilities
District for the acquisition of the City Improvements by the City (other than City Improvements
described in the first paragraph of this Section), the value of such City Improvements shall include the
construction costs specified in the City-approved contracts (subject to the next sentence), Change
Orders, and City-approved Significant Change Orders conforming to Section 6, as hereinbefore
specified. City approval is a condition prior to initiation of contract work for City Improvements bid
after the effective date of this Agreement. However, if the City reasonably determines that the
additional Actual Costs are excessive and that the value of the City Improvements is less than the total
amount of such Actual Costs and such construction costs, the price to be paid for the acquisition of the
City Improvements shall be the value thereof as determined by the Engineer, subject, however, to the
Developer’s right to appeal to the City Council.
Upon completion of the construction of a City Improvement, the Developer shall deliver or
cause to be delivered to the City a Disbursement Request Form in substantially the form of
Exhibit “D,” attached hereto, copies of the contract(s) with the contractor(s) who have constructed the
City Improvement and other relevant documentation with regard to the payments made to such
contractor(s) and each of them for the construction of the City Improvement, documentation
evidencing payment of prevailing wages, and shall also provide to the City invoices and purchase
orders with respect to all equipment, materials and labor purchased for the construction of the City
Improvements. The City shall require the Engineer to complete its determination of the value of the
City Improvements as promptly as is reasonably possible.
Notwithstanding the preceding provisions of this Section, the source of funds for the
acquisition of the City Improvements or any portion thereof shall be funds in the City Improvements
Account. If for any reason beyond the City’s control the Bonds are not sold, the City shall not be
required to acquire the City Improvements from the Developer, except to the extent of funds from the
collection of Special Taxes. In such event, the Developer shall complete the design and construction
and offer to the City ownership of such portions of the City Improvements as are required to be
constructed by the Developer as a condition to recordation of subdivision maps for the Developer
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Property (but only at such times as required by such condition), but need not construct any portion of
the City Improvements which it is not so required to construct. Reimbursement for these facilities
would be made from the collection of Special Taxes over time.
In addition to the foregoing, the City shall have the right to withhold payment for acquisition
of a City Improvement, if:
(a) the Developer or any of its affiliates is delinquent in the payment of any Special
Taxes levied by the Community Facilities District on properties then owned by the Developer or any
of its affiliates within the CFD, or
(b) the Developer is not then in substantial compliance with a condition or
obligation imposed upon the Developer Property by the City, including but not limited to, payment of
all applicable fees, dedication of all applicable rights-of-way or other property and construction
requirements.
The City shall immediately provide written notice to the Developer of the decision to withhold
any such payment and shall specify the reason for such decision. If the payment is withheld as a result
of the delinquency in the payment of Special Taxes, the notice shall identify the delinquent parcels and
the amount of such delinquency. If the payment is withheld as a result of substantial non-compliance
with a condition or obligation, the notice shall specify such condition or obligation and what action
will be necessary by the Developer to substantially comply with such condition or obligation. Upon
receipt of evidence reasonably satisfactory to the City that the Developer has paid the delinquent
Special Taxes or complied with the subject condition or obligation, the City shall forthwith make all
payments which have been withheld pursuant to the provisions of this Section.
11. Easements and/or Fee Title Ownership Deeds. Without limiting the Developer’s
rights to reimbursement for such grants pursuant to Section 10 above, the Developer shall, at the time
the City acquires the City Improvements as provided in Section 10 hereof, grant or cause to be granted
to the City, by appropriate instruments prescribed by the City, all easements across private property
and/or fee title ownership deeds which may be reasonably necessary for the proper operation and
maintenance of such City Improvements, or any part thereof, but only to the extent located within the
Developer Property.
12. Permits. The Developer shall be responsible for obtaining all necessary construction
permits from the City and/or the County (as appropriate) covering construction and installation of the
City Improvement.
13. Maintenance. Prior to the transfer of ownership of a City Improvement by the
Developer to the City, as provided in Section 10 hereof, the Developer shall be responsible for the
maintenance thereof and shall require its contractor(s) to repair all facilities damaged by any party
other than the City, prior to acceptance by the City and/or make corrections determined to be necessary
by the City’s inspection personnel. The City shall not be permitted to place any City Improvement in
service prior to acceptance of the same, unless the Developer otherwise consents in writing.
14. Inspection of Records. The City shall have the right to review all books and records
of the Developer pertaining to the costs and expenses incurred by the Developer for the design and
construction of the City Improvements during normal business hours by making arrangements with the
Developer. The Developer shall have the right to review all books and records of the City pertaining
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to costs and expenses incurred by the City for services of the Engineer by making arrangements with
the City.
15. Ownership of Improvements. Notwithstanding the fact that some or all of the City
Improvements may be constructed in dedicated street rights-of-way or on property which has been or
will be dedicated to the City, each City Improvement shall be and remain the property of the Developer
until acquired by the City as provided in this Agreement. The foregoing shall not apply to the Utility
Undergrounding.
16. Materials and Workmanship Warranty. The requirements of this Section shall not
apply to any City Improvement that was complete (as determined by the City Council) prior to the
adoption by the City Council of the resolution forming the CFD, but they shall apply to all other City
Improvements.
Upon the completion of the acquisition of a City Improvement by the City, the performance
bond related to such individual City Improvement provided by the Developer pursuant to
Section 7.1(e) hereof, shall be reduced by 90%, and the remaining 10% shall serve as a maintenance
bond to guarantee that such City Improvement will be free from defects due to faulty workmanship or
materials for a period of one year.
17. City Fee Facility Improvements. The Developer may be required pursuant to the
conditions of development or the fee ordinance to pay certain City fees (the “City Fees”) relating to
the City Fee Facility Improvements prior to the availability of proceeds of the Bonds to pay for such
City Fee Facility Improvements. In the event such City Fees are paid prior to the availability of Bond
proceeds, the amounts paid to the City shall be deemed to be deposits (each a “Deposit”) that are
subject to refund by the City to the Developer in accordance with this Agreement. The City shall place
each Deposit in a capital facilities account(s). If the Developer has made any Deposits to the City, then
following deposit of Bond proceeds in the City Fee Facility Improvements Account, the City shall
return to the Developer, from the capital account in which the Deposits were deposited the Deposits
not previously returned, without interest or other earnings thereon. The City shall be so obligated to
return such Deposits only to the extent that an equivalent amount of the Deposits to be returned is
deposited in the City Fee Facility Improvements Account from Bond proceeds or Special Tax
collections prior to the issuance of Bonds.
Bond proceeds used to finance City Fee Facility Improvements which relate to the City Fees
shall be allocated first for return of all Deposits prior to being allocated to the payment of City Fees
not previously deposited by the Developer. Any Deposits that have not been returned to the Developer
at the time it is determined that there will be no further Bond proceeds available (i.e. the final series of
Bonds to finance the Improvements have been issued) shall be retained by the City and may be used
for the purposes for which the City Fee was required, and the unrefunded Deposits shall constitute full
and final payment for such City Fees, without any increase of any kind.
18. Miscellaneous Improvements. Improvements unrelated to the City Improvements
and the City Fee Facility Improvements are described in Exhibit “C” attached hereto. The amounts
deposited in the applicable Miscellaneous Improvement Account(s), if any, will be disbursed for the
acquisition or construction of Miscellaneous Improvements in accordance with the provisions in the
applicable Joint Community Facilities Agreement. Any amounts in the applicable Miscellaneous
Improvement Account(s) shall be disbursed at the written direction of the City upon Developer’s
submittal of a payment request which will be based upon applicable entity’s payment request form as
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provided for in the applicable Joint Community Facilities Agreement. Upon receipt of such payment
request, the City shall submit a written requisition for payment of the requested amount to the Fiscal
Agent for the Bonds, who shall directly pay the amount requested to the applicable entity.
19. Independent Contractor. In performing this Agreement, Developer is an independent
contractor and not the agent of the City. The City shall not have any responsibility for payment to any
contractor or supplier of Developer. It is not intended by the Parties that this Agreement create a
partnership or joint venture among them and this Agreement shall not otherwise be construed.
20. Indemnification. Developer shall assume the defense of, indemnify and save
harmless, the City, its officers, employees and agents, and the Community Facilities District, its
officers, employees and agents, from and against all actions, damages, claims, losses or expenses of
every type and description to which they may be subject or put, by reason of, or resulting from such
person’s or entity’s performance of its obligations under this Agreement and the construction of the
City Improvements and the Miscellaneous Improvements, the failure of the Developer to provide
notice of the Special Tax to be levied by the Community Facilities District pursuant to Section 53341.5
of the Act (but only if the Developer is required by law to provide such notice), or arising out of any
alleged misstatements of fact or alleged omission of a material fact made by the Developer, its officers,
directors, employees or agents to the City, the Community Facilities District, the underwriter of the
Bonds and its counsel, the appraiser, the special tax consultant, the market absorption consultant or
bond counsel regarding the Developer, its proposed developments, its property ownership, and any
contractual arrangement it may enter into in a disclosure document describing the Community
Facilities District and the risks relating to the Bonds. No provision of this Agreement shall in any way
limit the extent of Developer’s responsibility for payment of damages resulting from the operations of
Developer and its contractors; provided, however that Developer shall not be required to assume the
defense or indemnify and save harmless any person or entity as to actions, damages, claims, losses or
expenses resulting from the breach of this Agreement, the willful misconduct of such person or entity
or their officers, agents, consultants or employees.
21. Insurance Requirements. For City Improvements bid after the effective date of this
Agreement, neither the Developer nor its contractor shall commence work on such City Improvement
under this Agreement prior to obtaining insurance with a company or companies acceptable to the City,
nor shall the Developer’s contractor allow any subcontractor to commence work on its subcontract
until all insurance required of the subcontractor has been obtained.
The Developer shall during the life of this Agreement, notify the City in writing of any incident
giving rise to any potential bodily injury or property damage claim and any resultant settlements,
whether in conjunction with this or any other project which may affect the limits of the required
coverage, as soon as is reasonable and practical.
22. Conflict With Other Agreements. Except as specifically provided herein, nothing
contained herein shall be construed as releasing Developer from any condition of development or
requirement imposed by any other agreement with City. In the event of a conflicting provision, such
other agreement shall prevail unless such conflicting provision is specifically waived or modified in
writing by City.
23. Notices. Any notice, payment or instrument required or permitted by this Agreement
to be given or delivered to either Party shall be deemed to have been received when personally
delivered or seventy-two (72) hours following deposit of the same in any United States Post Office in
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California, registered or certified, postage prepaid. Any notice to the Community Facilities District or
the City shall be addressed to City of Menifee, 29844 Haun Road, Menifee, CA 92530, Attention:
Assistant City Manager. Any notice to Developer shall be addressed to Lennar Homes of California,
LLC, 980 Montecito Drive Ste 206, Corona, CA 92879, Attention: Geoff Smith.
Each Party may change its address for delivery of notice by delivering written notice of such
change of address to the other Party hereto.
24. No Gift or Waiver.
24.1 No Gift or Waiver for City Improvements. The Developer and the City
acknowledge that:
(a) The Developer or its predecessor may have constructed or may be constructing
City Improvements before funds that will be used to acquire them are available with the expectation
that the Developer will be reimbursed for such City Improvements to the extent and in the manner set
forth in this Agreement.
(b) The City may inspect City Improvements and process Disbursement Request
Forms even if funds from the proceeds of Bonds available at the time of such inspection and processing
do not exist or are not then sufficient to satisfy the Disbursement Request in full.
(c) The Developer may convey City Improvements to the City and the City may
accept such City Improvements even if funds from the proceeds of Bonds available at the time of such
conveyance and acceptance do not exist or are not then sufficient to satisfy the Disbursement Request
in full.
(d) If the City accepts City Improvements before a Disbursement Request is paid
in full, the unpaid balance of the Disbursement Request will be paid from time to time, in any number
of installments and irrespective of the length of time payment is deferred, as funds from the proceeds
of Bonds become available.
(e) The Developer’s conveyance or dedication of City Improvements to the City
before the availability of funds from the proceeds of Bonds to acquire the City Improvements is not
and shall not be deemed, a gift or a waiver of the Developer’s right to payment of the purchase price
of such City Improvements pursuant to this Agreement.
24.2 No Gift or Waiver for City Fees. The Developer and the City acknowledge
that:
(a) Prior to the availability of funds from the proceeds of Bonds, the Developer or
its predecessor may have been or may be required to deposit funds to assure payment of applicable
City Fees of the City.
(b) The Developer or its predecessor has deposited or will be depositing such funds
with the expectation that the Developer will be reimbursed for these Deposits to the extent and in the
manner set forth in this Agreement.
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(c) The reimbursement of such Deposits pursuant to Section 16 of this Agreement
may occur from time to time, in any number of installments and irrespective of the length of time
payment is deferred, as funds become available.
(d) The Developer’s deposit of such funds to the City before the availability of
funds to reimburse the Developer is not, and shall not be deemed, a gift or a waiver of the Developer’s
right to reimbursement of such Deposits pursuant to this Agreement.
25. General Provisions.
(a) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the City and the Developer and their respective heirs, executors, legal representatives,
successors, and authorized assigns.
(b) Amendment. This Agreement may be amended at any time but only in writing
signed by each Party hereto.
(c) Entire Agreement. This Agreement, and the agreements referenced herein,
contains the entire understanding and agreement between the Parties with respect to the matters
provided for herein and supersedes all prior agreements and negotiations between the Parties with
respect to the subject matter of this Agreement. There are no oral or written representations,
understanding, undertakings or agreements which are not contained or expressly referred to herein, and
any such representations, understandings or agreements are superseded by this Agreement. Failure by
a Party to insist upon the strict performance of any of the provisions of this Agreement by the other
Parties hereto, or the failure by a Party to exercise its rights upon the default of another Party, shall not
constitute a waiver of such Party’s right to insist and demand strict compliance by such other Parties
with the terms of this Agreement thereafter. This Agreement shall be binding upon, and enforceable
by and against the Community Facilities District upon the establishment of the Community Facilities
District.
(d) Exhibits. All exhibits attached hereto are incorporated into this Agreement by
reference.
(e) Severability. If any part of this Agreement is held to be illegal or unenforceable
by a court of competent jurisdiction, the remainder of this Agreement shall be given effect to the fullest
extent reasonably possible.
(f) Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by the other Parties hereto, or the failure by a Party to exercise its rights
upon the default of another Party, shall not constitute a waiver of such Party’s right to insist and demand
strict compliance by such other Parties with the terms of this Agreement thereafter.
(g) No Third Party Beneficiaries. Except as provided explicitly in this Agreement,
no person or entity shall be deemed to be a third party beneficiary hereof, and nothing in this Agreement
(either express or implied) is intended to confer upon any person or entity, other than the City, the
Community Facilities District, the Developer, and the Security Provider (and their respective
successors and assigns), any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
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(h) Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which shall constitute but one instrument.
(i) Assignment. Developer may assign all or any of its rights pursuant to this
Agreement to a purchaser of all or any portion of the Developer Property. Such a purchaser and
assignee shall, as a condition to taking an assignment of such rights, enter into an assignment and
assumption agreement with the City and Developer, in a form reasonably acceptable to Developer and
the City, whereby such rights assigned are specified and such purchaser agrees, except as may be
otherwise specifically provided therein, to assume the obligations of Developer pursuant to this
Agreement and to be bound thereby. A company that acquires all of the assets of the Developer,
including ownership of the Developer itself, shall be deemed a successor and shall not require an
assignment or assumption agreement to be bound by, and enjoy the benefits of, this Agreement.
(j) Governing Law. This Agreement and any dispute arising hereunder shall be
governed by and interpreted in accordance with the laws of the State of California.
(k) Construction of Agreement. This Agreement has been reviewed by legal
counsel for both the City and Developer and shall be deemed for all purposes to have been jointly
drafted by the City and Developer. No presumption or rule that ambiguities shall be construed against
the drafting Party shall apply to the interpretation or enforcement of this Agreement.
(l) Termination. The provisions of this Agreement related to the acquisition and
financing of the Improvements shall terminate and be of no further force or effect if the first series of
Bonds for the CFD are not sold within ten years from the date of this Agreement unless extended by
agreement of all the Parties. If the City is unable to sell the first series of Bonds for the CFD after
diligent, commercially reasonable efforts to do so, this Agreement shall terminate and be of no further
force and effect; provided, however, in such event, any collected Special Taxes remaining after the
payment of administrative expenses of the CFD and reimbursement to the Developer of CFD formation
costs shall be used to pay for Improvements in accordance with this Agreement and Developer shall
receive a credit against City Fees otherwise payable to City in the amount so used to pay for City Fee
Facility Improvements.
(m) Attorneys’ Fees. In the event of any action or proceeding, including an
arbitration or a reference pursuant to Section 638 et seq., of the Code of Civil Procedure brought by
any Party against any other under this Agreement, the prevailing Party shall be entitled to recover its
actual attorneys’ fees and all fees, costs and expenses incurred for prosecution, defense, consultation,
or advice in such action or proceeding. In addition to the foregoing, the prevailing Party shall be
entitled to its actual attorneys’ fees and all fees, costs and expenses incurred in any post-judgment
proceedings to collect or enforce the judgment. This provision is separate and several and shall survive
the merger of this Agreement into any judgment on this Agreement.
(n) Venue and Forum. Any action at law or in equity arising under this Agreement
brought by any Party hereto for the purpose of enforcing, construing or determining the validity of any
provision of this Agreement shall be filed and tried in the Superior Court of the County of Riverside,
State of California, and the Parties waive all provisions of law providing for the filing removal or
change of venue to any other Court.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year
written below.
DATED: __________________, 2022
CITY OF MENIFEE, a political subdivision of
the State of California
By:
Armando G. Villa, City Manager
ATTEST:
By:
Sarah Manwaring, City Clerk
APPROVED AS TO FORM:
CITY ATTORNEY FOR THE CITY OF
MENIFEE
By:
Jeffrey T. Melching, City Attorney
LENNAR HOMES OF CALIFORNIA, LLC,
A California limited liability company
By:
Name:
Title:
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LIST OF EXHIBITS
EXHIBIT A - DESCRIPTION OF DEVELOPER PROPERTY
EXHIBIT B - DESCRIPTION OF COST ESTIMATES
EXHIBIT C - MISCELLANEOUS IMPROVEMENTS
EXHIBIT D - DISBURSEMENT REQUEST FORM
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EXHIBIT A
DESCRIPTION OF DEVELOPER PROPERTY
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EXHIBIT B
DESCRIPTION OF COST ESTIMATES OF THE IMPROVEMENTS (1)
I. CITY FEE FACILITY IMPROVEMENTS.
Estimated Cost of the City Fee Facility Improvements
Description Estimated Cost
Law Enforcement $ 87,549
Fire Facilities 232,706
Circulation 1,769,930
General Government 386,959
Public Use Facilities 58,366
Parks – Land Acquisition 81,485
Parks – Improvements 250,519
City Projects 573,503
Total City Fees Facility Improvements $3,441,017
II. CITY IMPROVEMENTS.
Those facilities constructed by or on behalf of the Developer and needed by City in order to
provide services to the Developer Property, including the following:
Estimated Cost of the City Improvements
Description Estimated Cost
Traffic Signals (Holland & Evans)(2)$ 643,905
Street & Traffic Signals (Murrieta & La Piedra (i.e. Mountain View))871,002
Traffic Signal Land Acq. (Murrieta & La Piedra / Evans & Holland)138,474
Traffic Signals (Evans & La Piedra)(2)76,161
Utility Undergrounding ‐ Rule 20(2)761,608
Park Improvements(2)3,800,000
Total City Improvements $6,291,150
(1)Amounts are estimates and subject to change. The Acquisition Price will be funded with Bond proceeds.
(2) Bids for these City Improvements were received prior to the effective date of the Acquisition, Construction and Funding
Agreement, however, such City Improvements shall only be eligible for financing by the CFD if the City determines that the
conditions under Section 53313.5 have been satisfied with respect to such City Improvements.
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EXHIBIT C
DESCRIPTION OF THE MISCELLANEOUS IMPROVEMENT
Water District facilities included in the Water District’s capacity and connection fee programs
used to finance expansion projects, exclusive of in-tract facilities constructed by a property owner, but
including and not limited to the following:
Description Estimated Cost
Sewer Financial Participation Charge $1,215,832
Sewer Treatment Plant Capacity Charge 2,594,255
Water Financial Participation Charge 2,304,699
Water Supply Development Fee 140,988
Meter Fees 142,883
Total Estimated Water District Facilities Fees $6,398,657
Those facilities constructed by or on behalf of the Developer and needed by the Water District
in order to provide services to the Developer Property and also include any of the following:
Estimated Cost of the Water District Improvements
Description Estimated Cost
TBD TBD
Menifee School District Improvements included in the Menifee School District’s development
fee programs used to finance Menifee School District Improvements, in approximately the following
amount:
Estimated Cost of the Menifee School District Improvements
Description Estimated Cost
Menifee Union School District Fees $3,594,144
Perris School District Improvements included in the Perris School District’s development fee
programs used to finance Perris School District Improvements, in approximately the following amount:
Estimated Cost of the Perris School District Improvements
Description Estimated Cost
Perris Union High School District Fees TBD
DocuSign Envelope ID: 45C96450-EB2D-46E1-875D-AC3252B94527
D-1
4863-2785-2828v3/200299-0009
EXHIBIT D
CFD NO. 2022-1 (QUARTZ RANCH) OF THE CITY OF MENIFEE
DISBURSEMENT REQUEST FORM
1. Community Facilities District No. 2022-1 (Quartz Ranch) of City of Menifee (the
“CFD”) is hereby requested to pay from the ________________________ Account, or any applicable
account or sub-account thereof, established by the CFD in connection with its 20__ Special Tax Bonds
(the “Bonds”) to City of Menifee (the “City”) as payee, the sum set forth below:
$_____________________ (the Requested Amount”)
2. The Requested Amount represents the payment of City Fees for ___ lot(s) within the
boundaries of the CFD (the “Property”).
(Tract No. __________, Lot Nos. ________________).
Or, City Improvements as supported by attached documentation.
3. The Requested Amount is due and payable, has not formed the basis of any prior
request or disbursement.
4. The City, as payee, is hereby directing payment of the Requested Amount be payable
to Lennar Homes of California, LLC, a California limited liability company (the “Developer”),
pursuant to the wiring instructions attached hereto.
5. The Requested Amount is authorized and payable pursuant to the terms of the certain
Acquisition, Construction and Funding Agreement (the “Agreement”) between the City of Menifee,
acting for and on behalf of itself and the CFD and Developer.
6. Capitalized undefined terms used herein shall have the meaning ascribed to them in the
Agreement.
DocuSign Envelope ID: 45C96450-EB2D-46E1-875D-AC3252B94527
D-2
4863-2785-2828v3/200299-0009
Dated:DEVELOPER:
LENNAR HOMES OF CALIFORNIA, LLC,
a California limited liability company
By:
Name:
Title:
Dated:CITY OF MENIFEE
By:
Its:
[ATTACH WIRING INSTRUCTIONS]
DocuSign Envelope ID: 45C96450-EB2D-46E1-875D-AC3252B94527