1999 AGN JUN 01 I17 - Laserfiche WebLink

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CITY OF COLTON AGENDA REPORT rvic v,vur4%_ , ivir,r.iinty yr aune i, lyyy TO: HONORABLE MAYOR & CITY COUNCIL r;a APPROVAL: HENRY GARCIA CITY MANAGER FROM: MICHAEL J. WILLIAMS, CITY TREASURER /LlJJ SUBJECT: Approval of a Resolution Declaring Results of Special Election, Determining Validity of Prior Proceedings and That Alteration of Rate and Method of Apportionment of Special Taxes is Lawfully Authorized, and Directing Recording of Amended Notice of Special Tax Lien for Community Facilities District No. 90-1 (Mt. Vernon Corridor) DATE: May 17, 1999 BACKGROUND: In the original bond issue, $4,755,000 Community Facilities District No. 90-1, (Mt. Vernon Corridor) of the City of Colton 1990 Special Tax Bonds, the Rate and Method of Apportionment (RMA) provided a template for allocating the Special Taxes between the two property owners of all parcels in the District. Although part of the bond proceeds were expected to be used by the Lebanoff-McKnight group to make improvements to their property, this was never done. In addition they have never made any payments of Special Taxes. Another factor that complicated this financing is that the other original property owner lost his interest in the property through foreclosure by his bank. The bank sold the property to WHC III Investors. WHC III Investors were interested in restructuring the bond issue. As a part of the refunding that was completed in December of 1998, the Lebanoff-McKnight parcels were "carved out' of the CFD for purposes of any ongoing financial responsibility related to Special Taxes or the bonds. The proposed RMA deletes all references to the Lebanoff-McKnight parcels and states that the Plaza Las Glorias parcels owned by WHCIII Investors are responsible for 100% of the Special Tax. The legal process to change the RMA is to hold an election of the property owners in the District. A total of eight ballots were sent out to both property owners divided according to their proportionate share of property in the District. WHC III Investors agreed as a part of the restructuring of the bonds to vote in favor of the proposed RMA. Lebanoff-McKnight was included in the process and would be expected to vote to reduce their Special Tax obligation to zero. In the event they fail to return a ballot or vote against the change in the RMA, their vote(s) will not decide whether or not the change is made. The number of votes is determined by acreage and the WHCIII group therefore has in excess of 67% of the votes to cast in the election. The Resolution reports on the results of the Special Election Changing the Rate and Method of Apportionment of the Special Taxes. At least two-thirds of the votes cast must be in favor of the proposed RMA to confirm the validity of the alteration. Item # 17