1. Community Facilities District Overview Saugus Union School District

2.  History of Community Facilities Districts  What is a Community Facilities District?  What can CFDs pay for?  CFD Administration Process Overview 2

3.  Prior to Prop 13, School Districts could levy what they needed  Prop 13 froze all taxes to 1% of AV – Schools had no way to fund facilities  Mello-Roos Community Facilities Act of 1982 was passed to provide an alternate method of financing needed improvements and services  The Act allows any public agency to form a Community Facilities District ("CFD") to pay for improvements and services History of CFDs 3

4.  A specific geographic area that levies a Special Tax  Mitigate impact of new development at higher rates than current school fees  Should be self sufficient – Administrative expenses paid by taxpayers, not general fund  May issue debt supported by Special Taxes  Can generate pay as you go funding  Adds a layer of complexity to existing finances What is a CFD ? 4

5.  Real or Tangible Property with a Useful life of 5 years or longer ◦ School buildings ◦ Administration buildings ◦ Furniture and fixtures ◦ School buses (views differ on whether they are fundable)  (New in Jan 2014) Maintenance of Real or Tangible Property with a Useful life of 5 years or longer ◦ If, they are in addition to and do not supplant existing services. What Can CFDs Pay For? 5

6. 6 Jan – March; Disclosure, 1 st Installment Delinquency Report, Permit research, Parcel Change Research, Interest payment date (if bonds issued) April – June; 2 nd Installment Delinquency Report, Permit research, Levy Calculation, Board Approval, 2 nd Installment Property Taxes due July – Sept; Finalize levy, County submittal, Principal and Interest payment (if bonds issued), Year end delinquency report Oct – Dec; Property Owner Phone calls, CDIAC Report, SB165 Report, 1 st Install Property Taxes due

7. KGPF Submits Levy to County Taxpayers Pay Tax Bill to County County Remits Taxes to District District Remits Taxes To Fiscal Agent Fiscal Agent Deposits Taxes into CFD Accounts Fiscal Agent Pays Bonds and Other CFD Expenses 7

8. 8 Detail Flow of Funds with Trustee District Submits “Gross Taxes” to Fiscal AgentFA Transfers Funds in following order A) Administrative Expense Fund (To Admin Requirement) B) Interest Account C) Principal Account D) Reserve Fund (If Necessary) E) Administrative Expense Fund (If Needed) F) Surplus School Facilities Fund (Free of Bond Obligation)

9. CDIAC (October 30) Required by the State -Outstanding Bonds -Assessed Values -Delinquencies and Foreclosure -Fund Balances Continuing Disclosure Required by SEC to Update Secondary Bond Market -Development Status -Value to Lien -Fund Balances -Delinquencies and Foreclosures Accountability Report Receive and File for the Board by Jan 1 -Collections and Expenditures of the CFD Reporting Requirements 9

10.  Lyn Gruber ◦ lyn@kgpf.net ◦ Office 760.510.0290 ◦ Cell 951.704.4799  Scott Koppel ◦ scott@kgpf.net ◦ Office 760.510.0290 ◦ Cell 760.586.5377  Douglas Floyd ◦ doug@kgpf.net ◦ Office 760.510.0290 Contact Information 10

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