2020-08-05 City Council Item No. 11.1 Lennar Homes to Community Facilities District No. 2020-1 (McCall Mesa) Presentation Regular MEETING - Additional Meeting MaterialsCONSENT ITEM 11.1 :
CONSIDERATION OF FORMATION:
TR 31098, LENNAR HOMES
TO COMMUNITY FACILITIES DISTRICT NO. 2020-1
(MCCALL MESA)
ROCHELLE CLAYTON
DEPUTY CITY MANAGER
AUGUST 5, 2020
Discussion
•THIS ITEM WAS PRESENTED TO THE FINANCE COMMITTEE ON MARCH 19,
2020.
•ON MAY 20,2020,THE CITY COUNCIL APPROVED RESOLUTION NO.20-
891,DECLARING ITS INTENT TO FORM COMMUNITY FACILITIES DISTRICT NO.
2020-1 (CFD NO.2020-1).
•THE DEVELOPER,LENNAR HOMES,HAS REQUESTED THE CITY ASSIST THEM IN
FORMING A FACILITIES COMMUNITY FACILITIES DISTRICT (CFD)TO FINANCE
CERTAIN DEVELOPMENT COSTS OF THE PROJECT RELATED TO THE CITY,
EASTERN MUNICIPAL WATER DISTRICT (EMWD)AND ROMOLAND SCHOOL
DISTRICT (RSD).THE CREATION OF CFD 2020-1 WOULD LEVY A SPECIAL
TAX WITHIN THE BOUNDARIES OF THE CFD AND ISSUE BONDS IN AN AMOUNT
NOT TO EXCEED $18,000,000.
Discussion
•THE AREA PROPOSED WITHIN CFD NO.2020-1 IS INCLUDED IN ATTACHMENT
A OF THE RESOLUTION OF INTENTION.THE PROPOSED DEVELOPMENT TO BE
INCLUDED INTO THE CFD NO.2020-1 INCLUDES THE 258 DETACHED SINGLE
FAMILY RESIDENTIAL PROPERTIES KNOWN AS MCCALL MESA ON 72 GROSS
ACRES WITHIN TRACT MAP NO.31098.
•AS REQUIRED BY THE RESOLUTION OF INTENTION (ROI)THE PROPOSED
BOUNDARY MAP FOR CFD 2020-1 WAS RECORDED MAY 28,2020 IN BOOK
85,PAGE 28 DOCUMENT NO.2020-0226590.
Location Map
Bradley RoadHolland Road
Discussion (Cont.)
A PUBLIC HEARING REPORT WAS PREPARED BY SPICER CONSULTING GROUP WHICH
DESCRIBES AND ANALYZES THE FACILITIES TO BE FINANCED BY THE CFD AND THE ESTIMATED
COSTS OF SUCH FACILITIES.
•THE ANTICIPATED ISSUANCE AMOUNT BASED ON CURRENT RATES WOULD BE
APPROXIMATELY $13,135,000 WHICH WOULD COVER A RESERVE FUND, FINANCING
COSTS, AND GENERATE APPROXIMATELY $11,199,603 IN NET BOND PROCEEDS FOR
FACILITIES.
•THE PROPOSED FACILITIES, WHICH MAY BE FUNDED WITH PROCEEDS OF THE BONDS
INCLUDE:
•$2,215,000 –CITY PRIORITY FACILITIES ($390,400 -20%PREMIUM TO PROJECT SPECIFIC
PRIORITIES,PER CITY’S CFD GOALS &POLICIES)
•$1,952,000 –CITY DEVELOPMENT IMPACT FEES
•$4,028,000 –EMWD FACILITIES
•$3,005,000 –RSD FACILITIES
IN ADDITION TO THE COSTS OF THE FORGOING FACILITIES,PROCEEDS OF THE SPECIAL TAX MAY BE
EXPENDED TO PAY ADMINISTRATIVE.
Discussion (Cont.)
•THE PROPOSED DEVELOPMENT IS PROPOSING TO BUILD 258 DETACHED RESIDENTIAL
UNITS WITH HOME SIZES RANGING FROM 1,769 TO 4,134 SQUARE FEET.
•THE PROJECT HAS PREVIOUSLY ANNEXED INTO CFD 2017-1 (MAINTENANCE
SERVICES)TO COVER LANDSCAPING,LIGHTING,STREET SWEEPING AND PAVEMENT
MANAGEMENT,DRAINAGE,PARKS AND TRAILS,AND GRAFFITI ABATEMENT SERVICE
COSTS.
•THE TOTAL TAX EFFECTIVE TAX RATE IS ESTIMATED AT 1.95%OF PROJECTED HOME
PRICES.THIS IS WITHIN THE 2%ALLOWABLE TAX RATE LIMIT IN THE CITY’S
FINANCING GOALS AND POLICIES.
•THE ESTIMATED ASSIGNED ANNUAL TAX RATES RANGE FROM $2,405 FOR HOME
SIZES LESS THAN 1,800 SQUARE FEET TO $3,647 FOR HOME SIZES GREATER
THAN 3,600 SQUARE FEET,WHICH RATES WILL ESCALATE AT 2%PER YEAR.
Discussion (Cont.)
•PROPOSED TIMELINE FOR FACILITIES CFD FORMATION :
•CITY COUNCIL MEETING –ADOPT RESOLUTION OF INTENTION (ROI) –5/20/2020
•PUBLIC HEARING –HOLD PUBLIC HEARING AND RESOLUTIONS, CONDUCT
ELECTION, AND INTRODUCE 1ST READING OF ORDINANCE –7/15/2020
•2ND READING OF ORDINANCE –8/5/2020
•BOND ISSUANCE WOULD BE REQUESTED BY DEVELOPER AFTER CERTAIN CRITERIA HAS
BEEN MET:
•DEVELOPMENT THRESHOLD –BUILDING PERMITS ISSUED
•INDIVIDUALLY OWNED THRESHOLD –DIVERSIFICATION OF OWNERSHIP
•VALUE-TO-LIEN THRESHOLD –EXCEEDS 4:1
•LETTER OF CREDIT SECURED –IF NECESSARY
•AN OFFERING DOCUMENT WOULD BE PREPARED AND PRESENTED TO CITY COUNCIL
PRIOR TO BOND ISSUANCE
Fiscal Impact
•THE SPECIAL TAX WILL BE LEVIED ANNUALLY ON TAXABLE PROPERTIES IN
CFD NO.2020-1 IN ACCORDANCE WITH THE RATE AND METHOD OF
APPORTIONMENT (RMA)TO PAY FOR THE COST OF FACILITIES,DEBT
SERVICE ON BONDS,AND ADMINISTRATION OF THE CFD.ANY BONDS
ISSUED BY CFD NO.2020-1 ARE NOT OBLIGATIONS OF THE CITY AND
WILL BE SECURED SOLELY BY THE SPECIAL TAXES LEVIED IN CFD NO.
2020-1.
•ALL COSTS ASSOCIATED WITH THE FORMATION IS BORNE BY THE
DEVELOPER.THE ROI INCLUDED SECTION 13 APPROVED A FORM OF A
REIMBURSEMENT AGREEMENT TO REIMBURSE THE DEVELOPER FOR THESE
COSTS IF AND WHEN BONDS ARE ISSUED FOR THE CFD.
•THERE IS NO FISCAL IMPACT TO THE CITY’S GENERAL FUND
Recommended Action
1.CITY COUNCIL INITIATE FORMATION OF COMMUNITY FACILITIES DISTRICT NO.2020-1
(MCCALL MESA)BY TAKING THE FOLLOWING ACTIONS:
A.HOLD PUBLIC HEARING,
B.ADOPT A RESOLUTION DETERMINING NECESSITY TO INCUR BONDED INDEBTEDNESS
C.ADOPT A RESOLUTION CALLING THE ELECTION,
D.HOLD A SPECIAL LANDOWNER ELECTION AND CANVASS THE ELECTION,
E.ADOPT A RESOLUTION DECLARING RESULTS OF SPECIAL LANDOWNER ELECTION;
AND
2.UPON APPROVAL OF THE PRECEDING RESOLUTIONS,INTRODUCE AN ORDINANCE
AUTHORIZING THE LEVY OF SPECIAL TAXES WITHIN CFD NO.2020-1;AND
3.APPROVE JOINT COMMUNITY FACILITIES AGREEMENTS WITH EASTERN MUNICIPAL WATERDISTRICTANDWITHROMOLANDSCHOOLDISTRICT
Questions?Thank You.