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HomeMy WebLinkAboutAgenda - Agenda Packets - Regular Meeting 11/1/2022 AGENDA SAN JACINTO CITY COUNCIL – REGULAR MEETING TUESDAY, NOVEMBER 1, 2022 5:30 PM CLOSED SESSION 6:30 PM OPEN SESSION LIVE STREAM LINK: www.sanjacintoca.gov COMMUNITY CENTER 625 S. Pico Avenue San Jacinto, CA 92583 951-487-7330 City of San Jacinto Page 1 Updated 10/27/2022 5:42 PM CRYSTAL RUIZ, MAYOR PHIL AYALA, MAYOR PRO TEM MICHAEL HEATH, COUNCILMEMBER BRIAN HAWKINS, COUNCILMEMBER ALONSO LEDEZMA, COUNCILMEMBER This City Council meeting is being conducted in-person and will be broadcast utilizing Livestream video. The City Council meeting may be observed virtually by joining the link on the City’s website. Public Comments will only be accepted in person during the meeting or in writing to the City Clerk. Participants viewing the Livestream will not have a comment option. For those wishing to email public comments for the November 1, 2022, City Council meeting, please submit your comments to be read aloud at the meeting by the City Clerk. Email comments to Julia Espinoza at jespinoza@sanjacintoca.gov. Please put “PUBLIC COMMENT” in the email subject line. Email comments on matters not on the agenda must be received before the time the Mayor calls the item for Public Comments. Email comments on the agenda items must be received before the time the Mayor closes public comments on the agenda item. All email comments shall be subject to the same rules as would otherwise govern speaker comments at the Council meeting. Electronic comments on agenda items for November 1, 2022, may only be submitted via email. Comments via text and social media (Facebook, Twitter, etc.) will not be accepted. Reading of Public Comments: The City Clerk will read all email comments, provided that the reading shall not exceed three (3) minutes, or such other time as the Council may provide, consistent with the time limit for speakers at a Council meeting. The email comments submitted shall become part of the record of the Council meeting. 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 at 951-487-7339. 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]. City of San Jacinto Page 2 Updated 10/27/2022 5:42 PM 1. ORGANIZATION 1.1. Public Comments on Closed Session Items 1.2. Closed Session 1.2.1. CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Government Code Section 54956.9(d)(1) Case: City of San Jacinto et al. v. The Jennie San Jacinto Properties Family Limited Partnership et al.; Riverside County Superior Court Case No. CVRI2201382. 1.3. Closed Session Report 1.4. Roll Call 1.5. Invocation 1.6. Pledge of Allegiance 1.7. Mayor/Council Member Report 1.8. Late Items 2. PUBLIC COMMENTS 3. CONSENT CALENDAR 3.A. Consent Calendar - City Council 3.A.1. Waiver of Full Reading of Ordinance(s), and Reading by Title Only 3.A.2. Minutes of the Regular City Council Meeting of October 18, 2022 RECOMMENDATION: Staff recommends that the City Council approve the City Council Regular Meeting Minutes of October 18, 2022. Department: City Clerk 3.A.3. Update on Emergency Replacement of Water Main Line on Artesia Street, between N. Jordan Avenue and N. Algona Avenue RECOMMENDATION Staff recommends that the City Council: 1. RECEIVE AND FILE the report on the emergency replacement of the water main line on Artesia Street between N. Jordan Ave. and N. Algona Ave.; and 2. DETERMINE that there is a need to continue the emergency action pursuant to San Jacinto Municipal Code §3.08.070(B)(1) City of San Jacinto Page 3 Updated 10/27/2022 5:42 PM Department: Water 3.A.4. Second Reading of Ordinance No. 22-16, Levying a Special Tax within Community Facilities District 2003-1, including certain annexation territory (Annexation No. 66) RECOMMENDATION: Staff recommends that the City Council conduct the second reading and adopt Ordinance No. 22-16: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO LEVYING A SPECIAL TAX WITHIN CITY OF SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2003-1, INCLUDING CERTAIN ANNEXATION TERRITORY Department: Finance 3.A.5. Second Reading of Ordinance No. 22-17, Authorizing the levy of Special Tax in Community Facilities District No. 2020-1 RECOMMENDATION: Staff recommends that the City Council conduct the second reading and approve Ordinance No. 22-17, Authorizing the Levy of Special Taxes of Community Facilities District No. 2020-1: ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO AUTHORIZING THE LEVY OF SPECIAL TAXES IN A COMMUNITY FACILITIES DISTRICT, INCLUDING CERTAIN ANNEXATION TERRITORY IDENTIFIED AS ANNEXATION NO. 7 (TAX ZONE NO. 8), INTO SAN JACINTO COMMUNITY FACILITIES DISTRICT Department: Finance 3.A.6. RCTC Letters of Support RECOMMENDATION: Staff recommends that the City Council approve the support letters for the Riverside County Transportation Commission (RCTC)’s application for the next round of the federal Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program for the Coachella Valley Rail (CV Rail) Tier II Project Approval and Environmental Documentation. Department: City Clerk 3.A.7. Approval of Joint Community Facilities Agreements as to Form for San Jacinto Unified School District Community Facilities District No. 2022-1 RECOMMENDATION: Staff recommends that the City Council adopt Resolution No. 3957, City of San Jacinto Page 4 Updated 10/27/2022 5:42 PM approving the Joint Community Facilities Agreements as to form between San Jacinto Unified School District, Eastern Municipal Water District, D.R. Horton Los Angeles Holding Company, Incorporated, and Genus L.P., for San Jacinto Unified School District Community Facilities District No. 2022-1. Department: Finance 3.A.8. Statement of Investment Policy RECOMMENDATION: Staff recommends that the City Council approve the revised Statement of Investment Policy and adopt Resolution No. 3958. Department: Finance 3.A.9. Approval for the Purchase of a New Truck -Mounted Vacuum Unit for the Public Utilities Water Division RECOMMENDATION: Staff recommends that the City Council: 1. APPROVE the purchase of a new Model PV150 truck-mounted vacuum unit for the Public Utilities Water Department for the quoted price of $121,955.60 (One Hundred Twenty-One Thousand Nine Hundred Fifty-Five Dollars and Sixty Cents); and 2. APPROPRIATE funding in the amount of $121,956 (One Hundred Twenty- One Thousand Nine Hundred Fifty-Six Dollars) to account 050-9000-450.40- 45 (Water - Capital - Machinery and Equipment). Department: Water 4. DISCUSSION ITEMS 4.1. Investment Portfolio Review with Advisors RECOMMENDATION: Staff recommends that the City Council receive and file the Investment Portfolio Review. Department: Finance 5. FUTURE REQUESTS FROM CITY COUNCIL TO STAFF 6. ADJOURNMENT City of San Jacinto Page 5 Updated 10/27/2022 5:42 PM DOCUMENTS RELATED TO OPEN SESSION AGENDAS (SB343) - Any public record, relating to an open session agenda item, that is distributed within 72 hours prior to the meeting is available for public inspection at the public counter located in the Administration Building of City Hall, 595 S. San Jacinto Avenue, San Jacinto, CA 92583. I, Julia Espinoza, City Clerk of the City of San Jacinto, do hereby certify that I caused to be posted the foregoing agenda this 27th day of October 2022 as requested by law. Julia Espinoza, City Clerk November 1, 2022 TO: City Council REQUESTED BY: Julia Espinoza, City Clerk APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Regular Minutes of October 18, 2022 RECOMMENDATION: Staff recommends that the City Council approve the City Council Regular Meeting Minutes of October 18, 2022. ATTACHMENTS: October 18, 2022 Regular Meeting Minutes 3.A.2 Packet Pg. 6 Page 1 ACTION MINUTES CITY COUNCIL – REGULAR MEETING TUESDAY, OCTOBER 18, 2022 5:30 PM CLOSED SESSION 6:30 PM OPEN SESSION LIVE STREAM LINK: www.sanjacintoca.gov COMMUNITY CENTER 625 S. PICO AVENUE SAN JACINTO, CA 92583 951-487-7330 1. ORGANIZATION Mayor Crystal Ruiz called the meeting to order at 6:30 pm. 1.1 Public Comments on Closed Session Items There were no public comments for Closed Session. 1.2 Closed Session 1.2.1 CONFERENCE WITH LEGAL COUNSEL – REAL PROPERTY NEGOTIATIONS (Government Code § 54956.8) Property APNs: 437-045-020, 437-072-004, -005, -006, -009, -010, 437-046-014 City Negotiators: Robert Johnson, City Manager; Michael Maurer, City Attorney Under Negotiation: Price and Terms 1.3 Closed Session Report City Attorney Michael Maurer indicated that there was no reportable action from Closed Session and that Councilmember Alonso Ledezma recused himself due to a conflict of interest. 1.4 Roll Call City Clerk Julia Espinoza conducted the roll call: Present: Mayor Crystal Ruiz, Mayor Pro Tem Phil Ayala, Councilmember Brian Hawkins, Councilmember Heath, and Councilmember Alonso Ledezma Absent: None CRYSTAL RUIZ, MAYOR PHIL AYALA MAYOR PRO TEM ALONSO LEDEZMA, COUNCILMEMBER MICHAEL HEATH, COUNCILMEMBER BRIAN HAWKINS, COUNCILMEMBER 3.A.2.a Packet Pg. 7 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) Page 2 City Council Regular Meeting Action Minutes October 18, 2022 1.5 Invocation Councilmember Hawkins gave the invocation. 1.6 Pledge of Allegiance Councilmember Heath led the Pledge of Allegiance. 1.7 Special Presentation(s)/Recognitions(s) 1.7.1. Proclamation for Code Enforcement Officer Appreciation Week - Mayor Ruiz presented Proclamations. *1.7.2. Caltrans Project Update - Caltrans District 8, Governmental and Legislative Affairs Liaison Andrea Harlin, presented information on the State Route 79 Median Barrier Safety Construction Project scheduled to begin November 2022, until spring 2023. 1.8 Mayor/Council Member Reports/Discussions Councilmembers provided their reports. 1.9 Late Items There were no late items. 2. PUBLIC COMMENTS There were three public comments:  Kevin Saunders  Marianne Derouin  Norm Kyriss 3. CONSENT CALENDAR 3.A Consent Calendar – City Council 3.A.1. Waiver of Full Reading of Ordinance(s), and Reading b y Title Onl y 3.A.2. Minutes of the Regular City Council Meeting of October 4, 2022/City Clerk/Approved 3.A.3. Warrants and Disbursements – September 2022/Finance Department/Approved 3.A.4. Continuing Appropriations – FY 2022-23 Budget Adjustment/Finance Department/Approved 3.A.2.a Packet Pg. 8 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) Page 3 City Council Regular Meeting Action Minutes October 18, 2022 3.A.5. San Jacinto Power 2022 Integrated Resource Plan/Finance Department/Approved 3.A.6. Update on Emergency Replacement of Water Main Line on Artesia Street, between N. Jordan Avenue and N. Algona Avenue/Water Department/Approved M/S/C (Hawkins/Ledezma) moved to approve the Consent Calendar. Motion carried 5/0. Ayes: Hawkins, Heath, Ledezma, Ayala, Ruiz Nays: None Absent: None Abstain: None 4. PUBLIC HEARINGS 4.1 Annexation of Territory Commonly Known as Century Communities into Community Facilities District No. 2020-1, Submitting the Levy of Special Tax to the Qualified Electors, Declaring Results of the Election, and Authorizing the Levy of Special Taxes for Annexation No. 7 Finance Director Erika Gomez presented the staff report. Mayor Ruiz opened the Public Hearing at 7:38 p.m. There were no public speakers. Mayor Ruiz closed the Public Hearing at 7:39 p.m. M/S/C (Hawkins/Heath) moved to adopt Resolution No. 3954, calling a Special Election and authorizing the annexation of territory into Community Facilities District 2020-1 and the levy of a Special Tax, and submitting the levy of Special Tax to the qualified electors. Motion carried 5/0. Ayes: Heath, Ayala, Ledezma, Hawkins, Ruiz Nays: None Absent: None Abstain: None M/S/C (Heath/Ledezma) moved to adopt Resolution No. 3955, declaring the results of a Special Annexation Landowner Election and directing the recording of an amended Notice of Special Tax Lien. Motion carried 5/0. Ayes: Ledezma, Hawkins, Heath, Ruiz, Ayala Nays: None Absent: None Abstain: None 3.A.2.a Packet Pg. 9 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) Page 4 City Council Regular Meeting Action Minutes October 18, 2022 M/S/C (Heath/Ledezma) moved to adopt Ordinance No. 22-17 for first reading, levying a Special Tax within Community Facilities District 2020-1, and including Annexation No. 7 (Tax Zone No. 8). Motion carried 5/0. Ayes: Ruiz, Heath, Ledezma, Ayala, Hawkins Nays: None Absent: None Abstain: None 4.2 Annexation of Territory into Community Facilities District 2003-1, Authorizing the Levy of Special Taxes, Submitting the Levy of Special Tax to the Qualified Electors, Declaring the Results of the Election, and Authorizing the Levy of Special Taxes for Annexation No. 66. Finance Director Erika Gomez presented the staff report. Mayor Ruiz opened the Public Hearing at 7:48 p.m. There were no public speakers. Mayor Ruiz closed the Public Hearing at 7:49 p.m. M/S/C (Hawkins/Heath) moved to adopt Resolution No. 3952, authorizing the annexation of territory to Community Facilities District 2003-1 and the levy of a Special Tax, and submitting the levy of Special Tax to the Qualified Electors. Motion carried 5/0. Ayes: Hawkins, Ayala, Ledezma, Heath, Ruiz Nays: None Absent: None Abstain: None M/S/C (Ledezma/Heath) moved to adopt Resolution No. 3953, declaring the results of a Special Annexation Landowner Election and directing the recording of an amended Notice of Special Tax Lien. Motion carried 5/0. Ayes: Ruiz, Ledezma, Heath, Hawkins, Ayala Nays: None Absent: None Abstain: None M/S/C (Ledezma/Heath) moved to adopt Ordinance No. 22-16 for first reading, and levying a Special Tax within Community Facilities District 2003-1, including Annexation No. 66. Motion carried 5/0. Ayes: Heath, Ruiz, Hawkins, Ayala, Ledezma Nays: None Absent: None Abstain: None 3.A.2.a Packet Pg. 10 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) Page 5 City Council Regular Meeting Action Minutes October 18, 2022 5. DISCUSSION ITEMS 5.1 Approval of Tract Map No. 37229, Century Communities of California, LLC There was no staff report. M/S/C (Heath/Hawkins) moved to approve Tract Map 37229 for Century Communities of California, LLC. Motion carried 5/0. Ayes: Ayala, Ruiz, Heath, Hawkins, Ledezma Nays: None Absent: None Abstain: None 5.2 Approval of Tract Map No. 37230, Century Communities of California, LLC There was no staff report. M/S/C (Hawkins/Ledezma) moved to approve Tract Map 37230 for Century Communities of California, LLC. Motion carried 5/0. Ayes: Ledezma, Ayala, Ruiz, Heath, Hawkins Nays: None Absent: None Abstain: None 6. CITY MANAGER UPDATE City Manager Robert Johnson presented the update for September 2022. 7. FUTURE REQUESTS FROM CITY COUNCIL TO STAFF There were no requests made. 8. ADJOURNMENT With no further business before the City Council, Mayor Ruiz adjourned the City Council's Regular Meeting at 8:07 p.m. 3.A.2.a Packet Pg. 11 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) Page 6 City Council Regular Meeting Action Minutes October 18, 2022 CITY OF SAN JACINTO: ________________________ Crystal Ruiz, Mayor ATTEST: ________________________ Julia Espinoza, City Clerk Approved as read: Approved as amended: 3.A.2.a Packet Pg. 12 Attachment: October 18, 2022 Regular Meeting Minutes (Regular Minutes of October 18, 2022) November 1, 2022 TO: City Council REQUESTED BY: Arthur Mullen, Water Utilities Superintendent APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Update on Artesia Main Water Line Emergency Replacement RECOMMENDATION Staff recommends that the City Council: 1. RECEIVE AND FILE the report on the emergency replacement of the water main line on Artesia Street between N. Jordan Ave. and N. Algona Ave.; and 2. DETERMINE that there is a need to continue the emergency action pursuant to San Jacinto Municipal Code §3.08.070(B)(1) DISCUSSION On August 2, 2022, the San Jacinto City Council authorized the emergency replacement of the water main line on Artesia St. between N. Jordan Ave. and N. Algona Ave. Per San Jacinto Municipal Code §3.08.070(B)(1), the City Manager is required to submit a report at every regular City Council meeting until the emergency action is terminated. Staff contacted six pipeline construction companies and has received preliminary estimates from two interested companies – Genesis Pipeline Construction and 4 West Pipeline Services. The scope of service includes the trenching and removal of 340 feet of existing pipe, installation of new C-900 pipe at 48 inches below grade, final connection of the new line, reconnection of service lines, backfilling the trench, and paving with 3-inch asphalt. August 16, 2022 Update The Engineering Department is finalizing the design and specifications to receive a more accurate bid. The proposals will be evaluated based on total cost, availability to b egin work, and the contractor’s experience with similar projects. September 6, 2022 Update Public Utilities Staff identified one additional contractor, Taylor Underground, Inc., as having interest in bidding the project. The Engineering Department issued the final design and specifications on August 23, and Staff held a site walkthrough with all three contractors on August 30. All three contractors requested clarifying information regarding details in the design specifications. Staff is working with the Engineering Department to respond to the requests for information. Once the requests for information have been answered, the contractors will submit final bids, and Staff will proceed with vendor selection and project award. 3.A.3 Packet Pg. 13 September 20, 2022 Update After providing the requested information, the City received revised bids from 4 West Pipeline, Inc. and Taylor Underground, Inc. Genesis Pipeline Construction declined to bid the project. The two proposals were evaluated for scope of work, availability, qualifications, and cost. Staff found that 4 West Pipeline’s scope of work was more detailed than Taylor Underground’s scope of work, though both proposals satisfactorily addressed the required services. Both firms also have similar qualifications and hold the appropriate credentials and licenses. The cost proposals submitted are as follows: 4 West Pipeline, Inc.: $323,393.00 Taylor Underground, Inc.: $361,879.00 4 West Pipeline has indicated that they are able to order materials immediately after receiving a Notice to Proceed. Material ordering will take approximately three weeks, after which 4 West will mobilize to the project site and begin work. Taylor Underground did not indicate their availability to begin work. Staff is currently working with the City Manager to confirm the vendor selection. October 4, 2022 Update Based on the criteria in the September 20, 2022, update, the City Manager has selected 4 West Pipeline, Inc. as the vendor for the project. The City Engineer and Engineering Department have assumed control of this project from Public Utilities. Contract documents have been prepared and sent to the vendor for execution. October 18, 2022 Update A pre-construction meeting was held on October 12, 2022, with 4 West Pipeline Inc., the San Jacinto Engineering Department, San Jacinto Public Utilities, RP General Construction (subcontractor), MEC, Inc. (subcontractor), and Inland Foundation Engineering (subcontractor). All parties agreed that the Notice to Proceed will be issued with a project start date of October 17, 2022, pending the application for and approval of an encroachment permit. Working hours will be between 7:00 am – 4:00 pm Monday – Friday. Road access on Artesia St. will be restricted to residents and emergency services only. 4 West Pipeline, Inc. will notify residents at least 48 hours prior to any water service interruption and will limit service interruption to one day in length while service connections are tied into the new main line. November 1, 2022 Update 4 West Pipeline, Inc. obtained its encroachment permit the week of October 17, 2022, mobilized on October 24, 2022, and began work on October 25, 2022. 4 West Pipeline, Inc. has a maximum of 60 working days to complete the project, with working hours of 7:00 am – 4:00 pm Monday – Friday. Road access on Artesia St. is restricted to accommodate residents and emergency services only. 4 West Pipeline, Inc. will notify residents at least 48 hours prior to any water service interruption and will limit service interruption to one da y in length while service connections are tied into the new main line. 3.A.3 Packet Pg. 14 FISCAL IMPACT There is no fiscal impact with regard to this update. On August 2, 2022, the City Council approved an appropriation of $600,000 in ARPA funds to cover the cost of the project. No additional expenditures are anticipated. 3.A.3 Packet Pg. 15 November 1, 2022 TO: City Council REQUESTED BY: Erika Gomez, Finance Director APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66 RECOMMENDATION: Staff recommends that the City Council conduct the se cond reading and adopt Ordinance No. 22-16: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO LEVYING A SPECIAL TAX WITHIN CITY OF SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2003-1, INCLUDING CERTAIN ANNEXATION TERRITORY DISCUSSION: At the September 6, 2022, City Council meeting, the City Council adopted Resolution No. 3947, declaring their intention to annex territory, residential properties at Century Communities, into Community Facilities District 2003-1 (CFD 2003-1), based upon a petition from the property owners. On October 18, 2022, the City Council held a public hearing and conducted the Special Annexation Landowner Election. Upon conducting the election, one affirmative vote was received from the property owner, and Annexation No. 66 was complete. The City Council also introduced Ordinance No. 22-16, authorizing the levy of special taxes in CFD 2003-1, including the newly annexed area. This second reading and adoption of Ordinance No. 22-16 is required to allow for the levy of special taxes related to this newly annexed area in the future. FISCAL IMPACT: The revenue received from the special tax will assist in offsetting the cost of increased police protection and fire protection, and suppression services necessitated by development of the annexed territory. As applicable, special taxes are collected and increased annually based on the percentage change in the Consumer Price Index, with a maximum annual increase of six percent (6%) and a minimum annual increase of two percent (2%) per fiscal year thereafter. Failure to approve Ordinance 22-16 would result in the inability to collect the annual special taxes, and the public safety costs of the territory would have to be subsidized by the City’s General Fund. ATTACHMENTS: Ordinance No. 22-16, CFD 2003-1 Annex. No. 66 CFD 2003-1 Annex 66 - 10-18-22 Staff Report 3.A.4 Packet Pg. 16 Ordinance No. 22-16 Page 1 of 4 ORDINANCE NO. 22-16 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF SAN JACINTO ) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO LEVYING A SPECIAL TAX WITHIN CITY OF SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2003-1, INCLUDING CERTAIN ANNEXATION TERRITORY City of San Jacinto Community Facilities District No. 2003-1 Annexation No. 66 WHEREAS, the City of San Jacinto (the “City”) has conducted proceedings pursuant to the Mello-Roos Community Facilities Act, Chapter 2.5 of Part 1 of Division 2 of Title 5, commencing with Section 53311, of the California Government Code (the “Act”) to establish “City of San Jacinto Community Facilities District No. 2003-1” (the “CFD”) for the purpose of financing certain municipal services (the “Services) as provided in the Act; and WHEREAS, the City has conducted proceedings to annex territory into the CFD and, in connection therewith, approved supplements to the Original Rate and Method (as supplemented, the “Rate and Method”); NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SAN JACINTO as follows: SECTION 1: By the passage of this Ordinance, pursuant to the Act, the Council hereby authorizes and levies the Special Tax within the CFD, including all territory annexed into the CFD prior to the date hereof, at the rate and in accordance with method set forth in the Rate and Method, which rate and method are by this reference incorporated herein. The Special Tax has previously been levied in the original territory of the CFD beginning in fiscal year 2004-05 and the Special Tax is hereby levied commencing in fiscal year 2022-23 in the territory annexed to the CFD subsequent to formation of the CFD, and in each fiscal year thereafter to pay for the Services for the CFD and all costs of administering the CFD. 3.A.4.a Packet Pg. 17 Attachment: Ordinance No. 22-16, CFD 2003-1 Annex. No. 66 (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) Ordinance No. 22-16 Page 2 of 4 The City Council hereby ratifies the levy of special taxes within the CFD pursuant to the Act, at the rate and in accordance with the Rate and Method, in fiscal years 2004-05 through 2022-23. SECTION 2: The City Manager or designee, or an employee or consultant of the City, is hereby authorized and directed each fiscal year to determine the specific Special Tax to be levied for the next ensuing fiscal year for each parcel of real property within the CFD, including all territory annexed to the CFD prior to the date hereof, in the manner and as provided in the Rate and Method. SECTION 3: Exemptions from the levy of the Special Tax shall be as provided in the Resolution of Formation, the Rate and Method and the applicable provisions of the Act. In no event shall the Special Tax be levied on any parcel within the CFD in excess of the maximum Special Tax specified in the Rate and Method. SECTION 4: All of the collections of the Special Tax shall be used as provided in the Act and in the Resolution of Formation, including, but not limited to, the payment of costs of the Services, the payment of the costs of the City in administering the CFD, and the costs of collecting and administering the Special Tax. SECTION 5: The Special Tax shall be collected in the sam e manner as ordinary ad valorem taxes are collected and shall have the same lien priority, and be subject to the same penalties and the same procedure and sale in cases of delinquency as provided for ad valorem taxes; provided, however, that the Council may provide for other appropriate methods of collection by resolution(s) of the Council. The City Manager of the City (or the City Manager’s designee) is hereby authorized and directed to provide all necessary information to the auditor/tax collector of the County of Riverside in order to effect proper billing and collection of the Special Tax, so that the Special Tax shall be included on the secured property tax roll of the County of Riverside for fiscal year 2022-23 and for each fiscal year thereafter, as set forth above, until no longer required to pay for the Services or until otherwise terminated by the City. SECTION 6: If for any reason any portion of this Ordinance is found to be invalid, or if the Special Tax is found inapplicable to any particular parcel within the CFD, including all territory annexed to the CFD prior to the date hereof, by a court of competent jurisdiction, the balance of this Ordinance and the application of the Special Tax to the remaining parcels within the CFD , including all territory annexed to the CFD prior to the date hereof, shall not be affected. 3.A.4.a Packet Pg. 18 Attachment: Ordinance No. 22-16, CFD 2003-1 Annex. No. 66 (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) Ordinance No. 22-16 Page 3 of 4 SECTION 7: The Mayor shall sign this Ordinance and the City Clerk shall cause the same to be published immediately after its passage at least once in a newspaper of general circulation circulated in the City. SECTION 8: This Ordinance shall become effective (30) days following its passage and adoption and shall be published once within fifteen (15) days upon passage and adoption in a newspaper of general circulation in the City of San Jacinto, County of Riverside. INTRODUCED at a regular meeting of the City Council of the City of San Jacinto held on October 18, 2022. PASSED, APPROVED, and ADOPTED this 1st day of November 2022 by the following vote: AYES: NAYS: ABSENT: ABSTAIN: CITY OF SAN JACINTO: __________________________ Crystal Ruiz, Mayor ATTEST: Julia Espinoza, City Clerk APPROVED AS TO FORM: BEST, BEST & KRIEGER LLP __________________________________ Michael J. Maurer, City Attorney 3.A.4.a Packet Pg. 19 Attachment: Ordinance No. 22-16, CFD 2003-1 Annex. No. 66 (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) Ordinance No. 22-16 Page 4 of 4 CERTIFICATION STATE OF CALIFORNIA) COUNTY OF RIVERSIDE) CITY OF SAN JACINTO) I, Julia Espinoza, City Clerk of the City of San Jacinto, DO HEREBY CERTIFY that the foregoing Ordinance No. 22-16 was passed, approved, and adopted at the Regular Meeting of the San Jacinto City Council held on November 1, 2022. AYES: NAYS: ABSENT: ABSTAIN: WITNESS MY HAND AND OFFICIAL SEAL this 1st day of November, 2022. ______________________________ Julia Espinoza, City Clerk City of San Jacinto 3.A.4.a Packet Pg. 20 Attachment: Ordinance No. 22-16, CFD 2003-1 Annex. No. 66 (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) AGENDA ITEM _____ October 18, 2022 TO: The Honorable Mayor and Members of the City Council FROM: Erika Gomez, Finance Director SUBJECT: Annexation of Territory into Community Facilities District 2003-1 (CFD 2003-1), Authorizing the Levy of Special Taxes, Submitting the Levy of Special Tax to the Qualified Electors, Declaring the Results of the Election, and Authorizing the Levy of Special Taxes for Annexation No. 66 RECOMMENDATION: Staff recommends that the City Council: 1. HOLD the Public Hearing related to the Annexation of Territory into CFD 2003-1. 2. ADOPT Resolution 3952, authorizing the annexation of territory to CFD 2003-1 and the levy of a Special Tax, and submitting the levy of Special Tax to the Qualified Electors. 3. CALL upon the City Clerk to conduct the Special Annexation Landowner Election. 4. ADOPT Resolution 3953, declaring the results of a Special Annexation Landowner Election and directing the recording of an amended Notice of Special Tax Lien. 5. INTRODUCE Ordinance 22-16 for a first reading and levying a Special Tax within CFD 2003-1, including Annexation No. 66. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO LEVYING A SPECIAL TAX WITHIN CITY OF SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2003-1, INCLUDING CERTAIN ANNEXATION TERRITORY DISCUSSION: The City Council and Planning Commission previously identified the need for additional funding for police protection and fire protection, and suppression services. This includes funding for increased service levels necessitated by new development within the City. In response, the City Council formed Community Facilities District 2003-1 (the "CFD") and approved the levy of special taxes therein. The City levies a special tax on eligible parcels within the CFD to mitigate the added cost of providing public safety services to new development. Based upon a petition from the property owner(s), the City Council declared its intention to annex this territory – commonly known as the site of Century Communities of California's new 154-unit residential development located at the northeast and southeast corners of E Esplanade Ave and S Hewitt St – into CFD 2003-1 by adopting Resolution 3947 at their meeting of September 6, 2022, which also established the Public Hearing date to tonight. The City Clerk has received the ballots from the property owner(s) necessary to declare the results of the Special Election. FISCAL IMPACT: The annexation of territory into CFD 2003-1 will assists in mitigating the cost of providing police protection and fire protection, and suppression services. In Fiscal Year 2023/2024, it is anticipated that the CFD will collect approximately $92,077 in special tax revenue based upon full project buildout. ATTACHMENTS: 3.A.4.b Packet Pg. 21 Attachment: CFD 2003-1 Annex 66 - 10-18-22 Staff Report (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) Resolution No. 3952 Resolution No. 3953 Ordinance No. 22-16 3.A.4.b Packet Pg. 22 Attachment: CFD 2003-1 Annex 66 - 10-18-22 Staff Report (Ordinance 22-16 Second Reading - CFD 2003-1 Annex 66) November 1, 2022 TO: City Council REQUESTED BY: Erika Gomez, Finance Director APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8 RECOMMENDATION: Staff recommends that the City Council conduct the second reading and approve Ordinance No. 22-17, Authorizing the Levy of Special Taxes of Community Facilities District No. 2020-1: ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO AUTHORIZING THE LEVY OF SPECIAL TAXES IN A COMMUNITY FACILITIES DISTRICT, INCLUDING CERTAIN ANNEXATION TERRITORY IDENTIFIED AS ANNEXATION NO. 7 (TAX ZONE NO. 8), INTO SAN JACINTO COMMUNITY FACILITIES DISTRICT DISCUSSION: At the September 6, 2022, City Council meeting, the City Council adopted Resolution No. 3946, declaring their intention to annex territory, residential properties at Century Communities, into Community Facilities District 2020-1 (CFD 2020-1), based upon a petition from the property owners. On October 18, 2022, the City Council held a public hearing and conducted the Special Annexation Landowner Election. Upon conducting the election, one affirmative vote was received from the property owner, and Annexation No. 8 was complete. The City Council also introduced Ordinance No. 22-17, authorizing the levy of special taxes in CFD 2020-1, including the newly annexed area. This second reading and adoption of Ordinance No. 22-17 is required to allow for the levy of special taxes related to this newly annexed area in the future. FISCAL IMPACT: The revenue received from the special tax will assist in funding the Services as defined in the Rate and Method of Apportionment. In Fiscal Year 2023/2024, it is anticipated that the CFD will collect $189,266.00 in special tax revenue based upon full project buildout and, if applicable, $67,606.00 in Contingent Special Tax revenue, both of which will increase annually by the change in CPI up to a maximum of 5%. Approval of Ordinance 22-17 would authorize the City to levy this territory the special taxes for CFD No. 2020-1, providing dedicated funding for maintenance and administrative service. Failure to approve Ordinance 22-17 would result in the 3.A.5 Packet Pg. 23 inability to collect the annual special taxes, and the maintenance and service costs of the territory would have to be subsidized by the City’s General Fund. ATTACHMENTS: Ordinance No. 22-17 CFD 2020-1 Annex 7 Tax Zone 8 - 10-18-22 Staff Report 3.A.5 Packet Pg. 24 Ordinance No. 22-17 Page 1 of 4 STATE OF CALIFORNIA ) ORDINANCE NO. 22-17 COUNTY OF RIVERSIDE ) ss CITY OF SAN JACINTO ) ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO AUTHORIZING THE LEVY OF SPECIAL TAXES IN A COMMUNITY FACILITIES DISTRICT, INCLUDING CERTAIN ANNEXATION TERRITORY IDENTIFIED AS ANNEXATION NO. 7 (TAX ZONE NO. 8), INTO SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2020-1 A. Recital WHEREAS, the City Council (the “City Council”) of the City of San Jacinto (the “City”) has established San Jacinto Community Facilities District No. 2020 -1, County of Riverside, State of California (the “District”) for the p urpose of levying special taxes on parcels of taxable property therein for the purpose of providing certain services which are necessary to meet increased demands placed upon the City as a result of the development of said real property; and WHEREAS, the rate and method of apportionment of special tax for the District is set forth in Exhibit “C” to the City Council Resolution No. 3946, which was adopted on September 6, 2022; and WHEREAS the City has conducted proceedings to annex territory into the District and, with respect to the proceedings, following an election of the qualified electors in the territory proposed for the annexation (the “Annexation Territory”), the City Council, on October 18, 2022, adopted a Resolution which declared the results of the special election and determined that the territory proposed to be annexed is added to and part of the District. B. Ordinance NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN JACINTO, CALIFORNIA, ACTING IN ITS CAPACITY AS THE LEGISLATIVE BODY OF COMMUNITY FACILITIES DISTRICT NO. 2020-1, DOES HEREBY ORDAIN AS FOLLOWS: Section 1. The foregoing recitals are true and correct. Section 2. By the passage of this Ordinance, the City Council hereby authorizes and levies the special tax within the District, including the Annexation Territory, pursuant 3.A.5.a Packet Pg. 25 Attachment: Ordinance No. 22-17 (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) Ordinance No. 22-17 Page 2 of 4 to the Community Facilities District Law, at the rate and in accordance with the rate and method of apportionment of special tax set forth in Resolution No. 3946, which rate and method is by this reference incorporated herein. The special tax has previously been levied in the original territory of the District beginning in Fiscal Year 202 0 pursuant to Ordinance No. 20-08 passed and adopted by the City Council on July 7, 2020, and the special tax is hereby levied commencing in Fiscal Year 2022/23 in the District, including the Annexation Territory identified as Annexation No. 7 (Tax Zone No. 8), and in each fiscal year thereafter to pay for the services for the District and the costs of administering the District. Section 3. The City Manager of the City or designee or employee or consultant of the City is hereby authorized and directed each fiscal year to determine the specific special tax to be levied for the next ensuing fiscal year for each parcel of real proper ty within the District, including the Annexation Territory, in the manner and as provided in Resolution No. 3946. Section 4. Exemptions from the levy of the special tax shall be as provided in Resolution No. 3946 and the applicable provisions of the Community Facilities District Law. In no event shall the special tax be levied on any parcel within the District in excess of the maximum special tax specified in Resolution No. 3946. Section 5. All of the collections of the special tax shall be used as provided in the Community Facilities District Law and in Resolution No. 3946, including, but not limited to, the payment of the costs of the services, the payment of the costs of the City in administering the District, and the costs of collecting and administering the special tax. Section 6. The special tax shall be collected in the same manner and at the same time as ordinary ad valorem taxes are collected and shall have the same lien priority, and be subject to the same penalties and the same procedure and sale in cases of delinquency as provided for ad valorem taxes; provided, however, that the District may collect Special Taxes at a different time or in a different manner if necessary to meet its financial obligations. The City Manager of the City, or his designee, is hereby authorized and directed to provide all necessary information to the auditor/tax collector of the County of Riverside in order to effect proper billing and collection of the special tax, so that the special tax shall be included on the secured property tax roll of the County of Riverside for Fiscal Year 2022/23 and for each fiscal year thereafter until no longer required to pay for the Services or until otherwise terminated by the City. Section 7. If for any reason any portion of this Ordinance is found to be invalid, or if the special tax is found inapplicable to any particular parcel within the District, including the Annexation Territory, by a court of competent jurisdiction, the balance of this Ordinance and the application of the special tax to the remaining parcels within the District, including the Annexation Territory, shall not be affected. 3.A.5.a Packet Pg. 26 Attachment: Ordinance No. 22-17 (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) Ordinance No. 22-17 Page 3 of 4 Section 8. The Mayor shall sign this Ordinance and the City Clerk shall cause the same, or a summary of it, to be published immediately after its passage at least once in a newspaper of general circulation for the City. Section 9. This Ordinance shall take effect 30 days from the date of final passage. INTRODUCED at a regular meeting of the City Council of the City of San Jacinto held on October 18, 2022. PASSED, APPROVED, and ADOPTED this 1st day of November 2022, by the following vote: AYES: NAYS: ABSENT: ABSTAIN: CITY OF SAN JACINTO: __________________________ Crystal Ruiz, Mayor ATTEST: Julia Espinoza, City Clerk APPROVED AS TO FORM: BEST, BEST & KRIEGER LLP __________________________________ Michael J. Maurer, City Attorney 3.A.5.a Packet Pg. 27 Attachment: Ordinance No. 22-17 (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) Ordinance No. 22-17 Page 4 of 4 STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss CITY OF SAN JACINTO ) CERTIFICATION I, Julia Espinoza, City Clerk of the City of San Jacinto, DO HEREBY CERTIFY that the foregoing Ordinance No. 22-17 was regularly passed, approved, and adopted by the Regular Meeting of the San Jacinto City Council held on the 1 st of November, 2022: AYES: NAYS: ABSENT: ABSTAIN: WITNESS MY HAND AND OFFICIAL SEAL this 1st day of November, 2022. ________________________________ Julia Espinoza, City Clerk 3.A.5.a Packet Pg. 28 Attachment: Ordinance No. 22-17 (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) AGENDA ITEM _____ October 18, 2022 TO: The Honorable Mayor and Members of the City Council FROM: Erika Gomez, Finance Director SUBJECT: Annexation of Territory commonly known as Century Communities into Community Facilities District No. 2020-1, Submitting the Levy of Special Tax to the Qualified Electors, Declaring Results of the Election, and Authorizing the Levy of Special Taxes for Annexation No. 7 RECOMMENDATION Staff recommends that the City Council: 1. HOLD the Public Hearing related to the Annexation of Territory into CFD 2020-1. 2. ADOPT Resolution 3954, calling a Special Election and authorizing the annexation of territory into CFD 2020-1 and the levy of a Special Tax, and submitting the levy of Special Tax to the Qualified Electors. 3. CALL upon the City Clerk to conduct the Special Annexation Landowner Election. 4. ADOPT Resolution 3955, declaring the results of a Special Annexation Landowner Election and directing the recording of an amended Notice of Special Tax Lien 5. INTRODUCE Ordinance 22-17 levying a Special Tax within CFD 2020-1, including Annexation No. 7, for a first reading. ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO AUTHORIZING THE LEVY OF SPECIAL TAXES IN A COMMUNITY FACILITIES DISTRICT, INCLUDING CERTAIN ANNEXATION TERRITORY IDENTIFIED AS ANNEXATION NO. 7 (TAX ZONE NO. 8), INTO SAN JACINTO COMMUNITY FACILITIES DISTRICT NO. 2020-1 DISCUSSION: The City Council and Planning Commission have identified the need for a financing mechanism for maintenance and services on improvements related to new development within the City. In response to the need for additional funding for such maintenance and services, the City Council formed Community Facilities District 2020-1 (the "CFD") and approved the levy of special taxes therein. The CFD provides funding for services including, but not limited to, the maintenance of landscaped areas, parkways, and median improvements throughout the CFD, and the maintenance and servicing of streetlights, traffic signals, and appurtenant facilities (the "Services"). The Rate and Method of Apportionment ("RMA") of the CFD defines multiple types of property that may be levied a special tax and utilizes tax zones to allow future development to annex to the CFD rather than forming a new CFD for each new development. The RMA also defines a Contingent Special Tax, which would be levied only if the developer failed to perform landscape maintenance to the City's standards. 3.A.5.b Packet Pg. 29 Attachment: CFD 2020-1 Annex 7 Tax Zone 8 - 10-18-22 Staff Report (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) The City will utilize the CFD as a tool to tax new development for the direct costs associated with the Services. The use of the CFD provides additional funds to mitigate the added cost of providing the Services to new development. Based upon a petition from the property owner, the City Council declared its intention to annex this territory – commonly known as the site of Century Communities of California's new 154-unit residential development located at the northeast and southeast corners of E Esplanade Ave and S Hewitt St – into CFD 2020-1 by adopting Resolution 3946 at their meeting of September 6, 2022, which also established the Public Hearing date to tonight. The City Clerk has received the ballots necessary to declare the results of the Special Election. FISCAL IMPACT: The annexation of territory into the CFD will assist in mitigating the cost of providing the Services. In Fiscal Year 2023/2024, it is anticipated that the CFD will collect $189,266.00 in special tax revenue based upon full project buildout and, if applicable, $67,606.00 in Contingent Special Tax revenue. ATTACHMENTS: Resolution No. 3954 Resolution No. 3955 Ordinance No. 22-17 3.A.5.b Packet Pg. 30 Attachment: CFD 2020-1 Annex 7 Tax Zone 8 - 10-18-22 Staff Report (Ordinance 22-17 Second Reading - CFD 2020-1 Annex 7, Tax Zone 8) November 1, 2022 TO: City Council REQUESTED BY: Julia Espinoza, City Clerk APPROVED BY: Robert A. Johnson, City Manager SUBJECT: RCTC Letters of Support RECOMMENDATION: Staff recommends that the City Council approve the support letters for the Riverside County Transportation Commission (RCTC)’s application for the next round of the federal Consolidated Rail Infrastructure and Safety Improvements (CRISI) grant program for the Coachella Valley Rail (CV Rail) Tier II Project Approval and Environmental Documentation. Additionally, RCTC are seeking support on a second letter for SB 1 funding via the Solutions for Congested Corridor Program (SCCP) and Local Partnership Program (LPP) for the Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project. Below is more information on both projects. CV Rail Project If awarded, the funds would allow RCTC to move forward with the Tier II environmental review for the CV Rail Project, which will provide preliminary engineerin g and evaluate the impacts of the proposed construction. The project proposes up to five daily intercity rail trips from Los Angeles into the Coachella Valley, with stops in Los Angeles, Orange, Riverside, and San Bernardino Counties. Without question, the service will transform, connect, boost access and equity, expand economic development and tourism, promote sustainability, and enhance the health of residents throughout our growing region. CV Rail service would be transformative for the region. Metrolink Double Track Project The Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project will allow greater access to multimodal transportation options, provide safety improvements, and help improve air quality in our region. Project improvements include: · Increased Commuter Rail Service - enabling increased Metrolink service frequency by double tracking stretches of the 91/Perris Valley Line along the Interstate (I)-215 corridor. · Improved Safety - reducing the high rate of collisions along dangerous stretches of Ramona Expressway by implementing safety improvements. · Bolstered Access to Transit Service - strengthening arterial connections so San Jacinto Valley residents may better access the Metrolink 91/Perris Valley Line and other transit 3.A.6 Packet Pg. 31 services. ATTACHMENTS: CVR CRISI GRANT LETTER RCTC Letter RCTC-CV Factsheet.p2 3.A.6 Packet Pg. 32 November 1, 2022 Administrator Amit Bose Federal Railroad Administration U.S. Department of Transportation 1200 New Jersey Avenue SE Washington, DC 20590 Subject: Support for the Coachella Valley Rail Project Application for Consolidated Rail Infrastructure and Safety Improvements (CRISI) Grant Funding Dear Administrator Bose: On behalf of the City of San Jacinto, I am pleased to support the California Department of Transportation (Caltrans) Division of Rail and Mass Transit’s $20 million grant application for the Consolidated Rail Infrastructure and Safety Improvements (CRISI) program for the Coachella Valley Rail (CV Rail) Tier II Project Approval and Environmental Documentation Project (Project). The proposed CV Rail service extends approximately 144 miles between Los Angeles and the Coachella Valley with stops within Los Angeles, Orange, San Bernardino, and Riverside counties. This project is a once-in-a-generation project for inland southern California because it is:  Transformational – Transforms the way Southern Californians will travel and interact  Interconnected – Links Los Angeles, Orange, San Bernardino, Riverside counties  Equitable – Expands access to jobs and education for residents in disadvantaged communities  Economically Driven – Connects and promotes regional and national commerce  Sustainable – Combats climate change by reducing single-occupancy vehicle use The Service Development Plan (SDP) and National Environmental Policy Act/California Environmental Quality Act (NEPA/CEQA) Tier I environmental clearance for the corridor was completed and unanimously approved in July 2022 by the Riverside County Transportation Commission (RCTC). The NEPA/CEQA Tier II environmental study estimated at $60,000,000 is the next step toward fulfilling the transformational vision. As a joint project between Caltrans, Federal Rail Administration, and RCTC—the local implementing agency—the grant award will fund:  Preliminary engineering along the 76-mile eastern section of track to the 30% level; and  Project-level environmental clearance for up to six stations, a new third main track, and associated grade crossing and signal improvements on the eastern section of the corridor. The State of California and RCTC have a vested interest in fostering equitable investments in transportation infrastructure and transit mobility, as well as in sustainable freight and goods 3.A.6.a Packet Pg. 33 Attachment: CVR CRISI GRANT LETTER (RCTC Letters of Support) movement. For this reason, both agencies are committed to providing matching funds for this game-changing project that benefits our economy, environment, and promotes equity in disadvantaged communities across the region. I am proud to support this application and urge its award. CV Rail aligns with the goals of the CRISI program and will provide vital connections for a growing region. For questions regarding this letter of support, please contact Rob Johnson, City Manager at (951) 487-7330. Sincerely, Crystal Ruiz, Mayor City Of San Jacinto SAN JACINTO: Nestled at the feet of the beautiful San Jacinto Mountains, San Jacinto, one of the oldest incorporated cities in Riverside County, is experiencing a unique renaissance as an attractive residential and growing retail location of some 48,000 residents. Offering fresh air and a fabulous year- round climate, this small town atmosphere spurs burgeoning business opportunities and long term potential within its 26 square miles. Residents often enjoy mountain biking, motorsports, and horseback riding, as well as, exercising along the San Jacinto River Watershed area and enjoying the entertainment provided by the Soboba Casino. San Jacinto is quickly becoming the region’s next best spot to locate due to an abundance of available land and a progressive City Council that welcomes and supports new business ventures. San Jacinto is your next destination place … #GoSanJacinto 595 S. San Jacinto Ave.|San Jacinto, CA 92583|Ph 951-487-7330|Fax 951-654-3728|www.sanjacintoca.gov 3.A.6.a Packet Pg. 34 Attachment: CVR CRISI GRANT LETTER (RCTC Letters of Support) November 1, 2022 The Honorable Lee Ann Eager Chair California Transportation Commission 1120 N Street, MS 52 Sacramento, California 95814 Re: Support for the Riverside County Transportation Commission Solutions for Congested Corridors and Local Partnership Program Grant Applications Dear Chair Eager: On behalf of the City of San Jacinto, I write in strong support of Riverside County Transportation Commission’s (RCTC) Solutions for Congested Corridor Program (SCCP) and Local Partnership Program (LPP) grant applications to fund the Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project (projects). The projects are vital components of RCTC’s vision to implement safe multimodal solutions in the rapidly growing communities of southwestern Riverside County and the San Jacinto Valley. Riverside County is the ffastest-growingcounty in California and the fifth ffastest-growingin the country, and these communities are ground zero for that growth. The Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project will allow greater access to multimodal transportation options, provide safety improvements, and help improve air quality in our region. Project improvements include: • Increased Commuter Rail Service – enabling increased Metrolink service frequency by double tracking stretches of the 91/Perris Valley Line along the Interstate (I)- 215 corridor. • Improved Safety – reducing the high rate of collisions along dangerous stretches of Ramona Expressway by implementing safety improvements. • Bolstered Access to Transit Service – strengthening arterial connections so San Jacinto Valley residents may better access the Metrolink 91/Perris Valley Line and other transit services. Decades of underinvestment in transportation systems in these communities show in the congestion that residents must weather every day on the I-215 corridor and unsafe surface streets such as Ramona Expressway to access employment and education opportunities. The same residents must also compete in traffic with the nation’s agricultural and freight carriers, 40 percent of which travels through the Inland Empire region. Projects like these that provide safe, accessible, multimodal facilities are critical for these communities and businesses to thrive. 3.A.6.b Packet Pg. 35 Attachment: RCTC Letter (RCTC Letters of Support) The Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project align with long term planning goals of improving mobility options between the San Jacinto Valley and Perris Valley and improving access to employment centers, governmental services, and medical facilities in downtown Riverside and beyond. The projects also leverage and support the Metrolink Perris Valley Line Capacity Improvement Project, for which the State recently awarded $25 million to Metrolink, a partnership application with RCTC. I am proud to support RCTC’s efforts to advance multimodal and safety projects in Riverside County. RCTC has already committed 59% of the $207 million needed to complete the projects. As a Self-Help County, RCTC is not only eligible to receive these funds but has demonstrated a major commitment to invest in mobility solutions necessary for the prosperity of its constituents. For these reasons, I support the award of these funds to RCTC for the Metrolink Double Track Project: Moreno Valley-Perris and the Mid County Parkway Ramona Expressway Project. Thank you, Crystal Ruiz, Mayor City of San Jacinto SAN JACINTO: Nestled at the feet of the beautiful San Jacinto Mountains, San Jacinto, one of the oldest incorporated cities in Riverside County, is experiencing a unique renaissance as an attractive residential and growing retail location of some 48,000 residents. Offering fresh air and a fabulous year- round climate, this small town atmosphere spurs burgeoning business opportunities and long term potential within its 26 square miles. Residents often enjoy mountain biking, motorsports, and horseback riding, as well as, exercising along the San Jacinto River Watershed area and enjoying the entertainment provided by the Soboba Casino. San Jacinto is quickly becoming the region’s next best spot to locate due to an abundance of available land and a progressive City Council that welcomes and supports new business ventures. San Jacinto is your next destination place … #GoSanJacinto 595 S. San Jacinto Ave.|San Jacinto, CA 92583|Ph 951-487-7330|Fax 951-654-3728|www.sanjacintoca.gov 3.A.6.b Packet Pg. 36 Attachment: RCTC Letter (RCTC Letters of Support) TransformationalDaily intercity passenger rail service will transform the way southern California residents travel, creating a car-free, stress-free option between major destinations, from downtown lights to desert delights. Regional ConnectionsService will link L.A. Union Station and the Coachella Valley, connecting riders 144 miles across the counties of Los Angeles, Orange, San Bernardino, and Riverside. CV Rail will connect communities with this new way to travel, enhancing the region’s quality of life. RouteLengthSoCal Population24 MillionSan Gorgonio PassTravelers160,000 / DayRunning TimeLos Angeles to Coachella ValleyBy theNumbersEconomic InvestmentThe new service will expand the regional economy by opening travel options and connections to restaurants, resorts, concert venues, sports facilities, and commercial and retail centers across the southland. The proposed stations also offer a host of transit-oriented development opportunities.Access & EquityInland communities are behind the state average and coastal regions in employment, income, and education levels. Daily service offers game-changing access to jobs and schools, creating equity in a region ORQJGHQLHGVXIƓFLHQWUHVRXUFHVSustainabilityTaking the train will combat climate change by reducing vehicle miles traveled. This project will explore low or zero emission locomotives. Seven of the nine proposed stations are in or near disadvantaged FRPPXQLWLHVZKLFKZLOOEHQHƓWQRWRQO\IURPDOWHUQDWLYHVWRWUDIƓFFKRNHGhighways, but also from better air quality and health conditions. TourismThe service will support tourism regionwide, from LA’s entertainment attractions to Orange County’s theme parks to Riverside County’s world-renowned festivals, bringing people together from around the globe. ProposedStationsWhy Coachella Valley Rail?California & BeyondCV Rail makes up a large segment of Amtrak’s planned Tucson-Phoenix-Los Angeles corridor with connections to San Diego, Santa %DUEDUDWKH3DFLƓF1RUWKZHVWDQG$UL]RQD7KHVHJPHQWLVDQLPSRUWDQWelement of the Amtrak Connects US national initiative. Population Growth7KH,QODQG(PSLUHLVWKHIDVWHVWJURZLQJUHJLRQLQ&DOLIRUQLDDQGWKHƓIWKIDVWHVWgrowing region in the U.S. It is the only area of its size and population in California without daily intercity passenger rail service. More than 160,000 people travel through the San Gorgonio Pass each day, demonstrating a clear need for this alternative.Inland EmpirePopulation4.65 MillionCommissionSupportedONTLAXSNAPSPHTRONRiversidePalm SpringsLos AngelesUnion StationFullertonSan BernardinoMontclairPomonaOOntario10101555515101021521521040560540540571011010521021021574747473797979626060915557711121221886111243241241133YucaipaRunningSpringsLake ArrowheadMorongo ValleyPalm DesertIndianWellsThermalMeccaDesert Hot SpringsThousand PalmsColtonFontanaMorenoValleyRialtoCathedral CityLa QuintaOrangeYorbaLindaLong AnaheimNorwalkLos AngelesCoronaPlacentiaNorcoAnaheimHills BeachSAN GORGONIO PASSCherry ValleyCalimesa2412OrangeORANGE COUNTYLOS ANGELES COUNTYRIVERSIDE COUNTY62SprinppgsggSAN BERNARDINO COUNTYCOACHELLAVALLEYLoma LindaRedlandsIndioCoachellaMid Valley247189138111P111111BanningBeaumontPass Area10609191Rancho MirageCabazon- Preferred Route - Existing Station - Potential Station Area LEGENDPotential CV Rail StationsProposed Coachella Valley Rail Alignment3.A.6.cPacket Pg. 37Attachment: RCTC-CV Factsheet.p2 (RCTC Letters of Support) November 1, 2022 TO: City Council REQUESTED BY: Erika Gomez, Finance Director APPROVED BY: Robert A. Johnson, City Manager SUBJECT: JCFA Approval - Starling Point RECOMMENDATION: Staff recommends that the City Council adopt Resolution No. 3957, approving the Joint Community Facilities Agreements as to form between San Jacinto Unified School District, Eastern Municipal Water District, D.R. Horton Los Angeles Holding Company, Incorporated, and Genus L.P., for San Jacinto Unified School District Community Facilities District No. 2022- 1. DISCUSSION: San Jacinto Unified School District (SJUSD) has formed Communit y Facilities District (CFD) No. 2022-1 pursuant to the provisions of the Mello-Roos Community Facilities Act of 1982. The Board of Trustees for SJUSD approved the Resolution of Intention for CFD No. 2022-1 on April 7, 2022, and the Resolution of Formation on May 12, 2022. This project has three Improvement Areas (IAs). IA 1 is planned for 177 single-family homes, IA 2 is planned for 192 single-family homes, and IA 3 is planned for 78 single-family homes, for a total of 447 homes within Tract Nos. 30379, 32582, and 33862. The CFD is located in the City of San Jacinto, east of Alessandro Avenue, south of Ramona Expressway, west of North Camino Los Banos, and north of Main Street, as depicted on the attached Boundary Map (Exhibit A). The property owners, D.R. Horton Los Angeles Holding Company, Incorporated (D.R. Horton), and Genus, L.P., a California Limited Partnership, along with SJUSD have requested the City of San Jacinto (City) enter into a Joint Community Facilities Agreement with SJUSD relating to SJUSD CFD No. 2022-1. D.R. Horton is the owner and developer of the property within IAs 1 and 2. Genus, L.P. is the owner of the property within IA 3 and is expected to sell the property to a builder to develop the homes within IA 3. The CFD will comply with the City’s land secured financing policy, such that the overall effective tax rate will not exceed two percent at the time of bond issuance. The CFD will finance SJUSD fees, City development impact fees, and EMWD facility costs in lieu of fees. The City will own and operate the City fee facilities financed through this CFD. In addition, SJUSD agrees that they will not place the City’s name on the property tax roll for any property tax bills within CFD No. 2022-1. Resolution No. 3957 (Exhibit B) approving the Joint Community Facilities Agreements (Exhibits C through E), as to form, will authorize the Mayor and the City Clerk to execute and deliver the Joint Community Facilities Agreements. FISCAL IMPACT: 3.A.7 Packet Pg. 38 None. ATTACHMENTS: Exhibit A - Boundary Map Exhibit B - Resolution No. 3957 Exhibit C - Joint Community Facilities Agreement IA 1 Exhibit D - Joint Community Facilities Agreement IA 2 Exhibit E - Joint Community Facilities Agreement IA 3 3.A.7 Packet Pg. 39 PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1OF THE SAN JACINTO UNIFIED SCHOOL DISTRICTOF THE SAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY OF RIVERSIDESTATE OF CALIFORNIA FILED IN THE OFFICE OF THE CLERK OF THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, THIS _____ DAY OF _____________, 202__. __________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICT I HEREBY CERTIFY THAT THE WITHIN MAP SHOWING THE PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, WAS APPROVED BY THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT AT A REGULAR MEETING THEREOF, HELD ON THE ________ DAY OF ______________, 202__, BY ITS RESOLUTION NO. ____________________. __________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICT COUNTY RECORDER'S CERTIFICATE: FILED THIS ______ DAY OF _________________, 202__, AT THE HOUR OF ______ O'CLOCK ____ .M., IN BOOK _________, OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AT PAGES _______, AS INSTRUMENT NO. _______________________________, IN THE OFFICE OF THE COUNTY RECORDER OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AT THE REQUEST OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT. __________________________________PETER ALDANA, ASSESSOR - COUNTY CLERK - RECORDERCOUNTY OF RIVERSIDEBY DEPUTY THE LINES AND DIMENSIONS OF EACH LOT OR PARCEL SHOWN ON THIS MAP SHALL BE THOSE LINES AND DIMENSIONS AS SHOWN ON THE RIVERSIDE COUNTY ASSESSOR'S MAPS FOR THOSE PARCELS LISTED. THE RIVERSIDE COUNTY ASSESSOR'S MAPS SHALL GOVERN FOR ALL DETAILS CONCERNING THE LINES AND DIMENSIONS OF SUCH LOTS OR PARCELS. . MAIN ST RAMONA EX PYALESSANDRO AVESAN JACINTO AVESITE VICINITY MAP N VERNON AVESHEET 1 OF 1 Legend PROPOSED DISTRICT BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2021-1 IMPROVEMENT AREA NO. 1 IMPROVEMENT AREA NO. 2 IMPROVEMENT AREA NO. 3 REMAINDER - NOT A PART 1 2 3 4 5 6 7 8 9 10 11 12 N CAMINO LOS BANOSALESSANDRO AVEBURT ST RA M O N A E X P R E S S W A Y 13 MAP REFERENCE NUMBER ASSESSOR'S PARCEL NUMBER IMPROVEMENT AREA1433-070-051 32433-110-020 33433-110-040 34434-190-007 35434-190-008 36434-230-003 27434-230-004 28434-250-002 29434-271-026 210434-300-012 111434-300-013 112434-300-016 113434-300-017 1 3.A.7.a Packet Pg. 40 Attachment: Exhibit A - Boundary Map (JCFA Approval - Starling Point) Resolution No. 3957 Page 1 of 3 STATE OF CALIFORNIA ) RESOLUTION NO. 3957 COUNTY OF RIVERSIDE ) CITY OF SAN JACINTO ) RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN JACINTO APPROVING JOINT COMMUNITY FACILITIES AGREEMENTS WITH SAN JACINTO UNIFIED SCHOOL DISTRICT FOR IMPROVEMENT AREA NO. 1, IMPROVEMENT AREA NO. 2 AND IMPROVEMENT AREA NO. 3 OF COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT WHEREAS, the Governing Board of the San Jacinto Unified School District (the “School District”) has formed Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) and Improvement Area No. 1, and Improvement Area No. 2 and Improvement Area No. 3 therein (collectively, the “Improvement Areas”) pursuant to the Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5 of Part 1 of Division 2 of Title 5 of the Government Code of the State of California (the “Act”) for the primary purpose of financing certain public facilities; and WHEREAS, pursuant to Section 53316.2 of the Act, a community facilities district is authorized to finance facilities to be owned or operated by an entity other than the agency that created the community facilities district pursuant to a joint community facilities agreement; and WHEREAS , the Governing Board of the School District and D.R. Horton Los Angeles Holding Company, Inc., a California corporation, the current owner of the taxable property within the Improvement Area No. 1 and Improvement Area No. 2 of the CFD are considering the use of the CFD to finance facilities that will be constructed, owned and operated by the City of San Jacinto (the “City”) and have requested the City to enter into a joint community facilities agreement with each of Improvement Area No. 1 and Improvement Area No. 2 of the CFD that would permit the CFD to finance such facilities, the forms of which are on file with the City Clerk and which are incorporated herein by this reference (the “D.R. Horton Joint Community Facilities Agreements”); WHEREAS, the Governing Board of the School District and Genus, L.P., a California Limited Partnership, the current owner of the taxable property within the Improvement Area No. 3 of the CFD are considering the use of the CFD to finance facilities that will be constructed, owned and operated by the City and have requested the City to enter into a joint community facilities agreement with Improvement Area No. 3 of the CFD that would permit the CFD to finance such facilities, the form of which is on file with the City Clerk and which is incorporated herein by this reference (the “Genus Joint Community Facilities Agreement,” and together with the D.R. Horton Joint Community Facilities Agreements, the “Joint Community Facilities Agreements”); 3.A.7.b Packet Pg. 41 Attachment: Exhibit B - Resolution No. 3957 [Revision 1] (JCFA Approval - Starling Point) Resolution No. 3957 Page 2 of 3 NOW, THEREFORE, THE CITY COUNCIL, DOES HEREBY RESOLVE, ORDER AND DETERMINE AS FOLLOWS: Section 1. Each of the above recitals is true and correct. Section 2. Pursuant to Section 53316.2 of the Act, this City Council hereby approves the Joint Community Facilities Agreements substantially in the form on file with the City Clerk and determines that the Joint Community Facilities Agreements will be beneficial to the residents of the territory served by the City and included within the jurisdictional boundaries of the CFD. The Mayor and the City Clerk are hereby authorized and directed to execute and deliver the Joint Community Facilities Agreements in said form with such changes, insertions and omissions as may be approved by the officer or officers executing such agreements, said execution and delivery being conclusive evidence of such approval. Section 3. This Resolution shall be effective upon its adoption. PASSED, APPROVED, and ADOPTED this 1st day of November 2022, by the following vote: AYES: NAYS: ABSENT: ABSTAIN: CITY OF SAN JACINTO: ______________________________ Crystal Ruiz, Mayor ATTEST: Julia Espinoza, City Clerk APPROVED AS TO FORM: BEST, BEST & KRIEGER LLP __________________________________ Michael J. Maurer, City Attorney 3.A.7.b Packet Pg. 42 Attachment: Exhibit B - Resolution No. 3957 [Revision 1] (JCFA Approval - Starling Point) Resolution No. 3957 Page 3 of 3 STATE OF CALIFORNIA) COUNTY OF RIVERSIDE) ss CITY OF SAN JACINTO) CERTIFICATION I, Julia Espinoza, City Clerk of the City of San Jacinto, CA, do hereby certify that this is a true and correct copy of the original Resolution No. 3957 for which the original is on file in my office. AYES: NAYS: ABSENT: ABSTAIN: WITNESS MY HAND AND THE SEAL on this 1st day of November, 2022. ______________________________ Julia Espinoza, City Clerk City of San Jacinto 3.A.7.b Packet Pg. 43 Attachment: Exhibit B - Resolution No. 3957 [Revision 1] (JCFA Approval - Starling Point) JOINT COMMUNITY FACILITIES AGREEMENT relating to Community Facilities District No. 2022-1 of the San Jacinto Unified School District Improvement Area No. 1 by and among San Jacinto Unified School District, City of San Jacinto and D. R. HORTON LOS ANGELES HOLDING COMPANY, INC., A CALIFORNIA CORPORATION THIS JOINT COMMUNITY FACILITIES AGREEMENT (the “Agreement”) is entered into effective as of the 1st day of April, 2022, by and among SAN JACINTO UNIFIED SCHOOL DISTRICT, a California unified school district (“School District”), the CITY OF SAN JACINTO, a California general law city (the “City”) and D.R. Horton Los Angeles Holding Company, Inc., a California corporation (“Property Owner”). This Agreement relates to the formation by the School District of a community facilities district known as “Community Facilities District No. 2022-1 of the San Jacinto Unified School District” (the “CFD”), and the establishment of Improvement Area No. 1 therein (“Improvement Area No. 1”) for the purpose of financing certain facilities to be constructed, owned, operated, or maintained by the School District, the City and Eastern Municipal Water District as a consequence of the development within the CFD to be used by the City to construct facilities to be owned and operated by the City from the proceeds of bonds issued by the CFD with respect to Improvement Area No. 1 and the proceeds of special taxes levied by the CFD with respect to Improvement Area No. 1. The CFD will also establish other improvement areas therein known as Improvement Area No. 2 (“Improvement Area No. 2”) and Improvement Area No. 3 (“Improvement Area No. 3”) (each an “Improvement Area” and together the “Improvement Areas”). R E C I T A L S: A. The property is depicted in Exhibit “A” and described in Exhibit “B” hereto (the “Property”), which is located in the City of San Jacinto, County of Riverside, State of California, and constitutes the land within the boundaries of proposed Improvement Area No. 1, proposed Improvement Area No. 2, and proposed Improvement Area No. 3 of the CFD. B. As of April 1, 2022, Property Owner owns the Property and intends to develop the Property for residential purposes consisting of Improvement Area No. 1 (177 single family residential units in Tract No. 30379) and Improvement Area No. 2 (192 single family residential units in Tract No. 32582). C. Property Owner petitioned the School District to form the CFD and the applicable Improvement Areas for the purpose of financing, among other things, the construction of various public facilities to be owned and operated by the City as described in Exhibit “C” hereto, which facilities will benefit the Property in whole or in part, including certain public facilities to be constructed, owned and operated by the City (the “City Fee Facilities”) in lieu of the payment of City Fees (defined below). D. Property Owner has yet to determine whether it will finance any or all of the City Fee Facilities, in lieu of payment of City Fees, with Bond Proceeds (defined below) that are available for such 3.A.7.c Packet Pg. 44 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 2 purpose. The Parties (defined below) hereto acknowledge that the purpose of this Agreement is to satisfy the requirements of the Act (defined below). E. In conjunction with the issuance of building permits for the construction of homes within Improvement Area No. 1, the Property Owner, or its successors or assigns, may elect to advance City Fee Facilities costs in lieu of payment of City Fees (the “Advance(s)”) at such times as Bond Proceeds are not available in sufficient amounts to pay for City Fee Facilities. In such case, the Property Owner shall be entitled to (i) reimbursement of such Advances limited to Bond Proceeds available to the City, if any (the Advances being considered an interest free loan by the Property Owner with no repayment obligation except to the extent there are Bond Proceeds received by or made available to the City as described herein, all as further described in Section 5(a) below) and (ii) credit for payments made to the City from Bond Proceeds against City Fees which would otherwise be due to the City with respect to the Property for which such transfer was made equal to the amount of Bond Proceeds disbursed to the City or at the direction of the City for City Fee Facilities, all as further described herein. F. In addition to the City Fee Facilities, certain facilities to be owned and operated by the School District (the “School Facilities”) and certain facilities to be owned and operated by Eastern Municipal Water District (“EMWD”) are also expected to be funded from Bond Proceeds. G. The School District has sole discretion and responsibility for the formation and administration of the CFD. H. The School District is authorized by Section 53313.5 of the Act to assist in the financing of the acquisition and/or construction of the City Fee Facilities. This Agreement constitutes a joint community facilities agreement, within the meaning of Section 53316.2 of the Act, by and among the City, the Property Owner, and the School District, pursuant to which the CFD, when and if the CFD and Improvement Area No. 1 are formed, will be authorized to finance the acquisition and/or construction of all or a portion of the City Fee Facilities. As authorized by Section 53316.6 of the Act, responsibility for constructing, providing for, and operating the City Fee Facilities is delegated to the City. I. The Parties (defined below) hereto find and determine that the residents residing within the boundaries of the City, the School District, and Improvement Area No. 1 of the CFD will be benefited by the construction and/or acquisition of the School Facilities and City Fee Facilities and that this Agreement is beneficial to the interests of such residents. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties hereto agree as follows: 1.Recitals. Each of the above recitals is incorporated herein and is true and correct. 2.Definitions. Unless the context clearly otherwise requires, the terms defined in this Section shall, for all purposes of this Agreement, have the meanings herein specified. (a)“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code. 3.A.7.c Packet Pg. 45 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 3 (b) “Advance” or “Advances” means an amount advanced by Property Owner to the City for City Fee Facilities in lieu of payment of City Fees prior to the availability of sufficient Bond Proceeds. Advances shall be deemed payment of City Fees to the extent sufficient Bond Proceeds are not received by or made available to the City. (c) “Bond Proceeds” or “Proceeds of the Bonds” shall mean those net funds generated by the sale of the Bonds and investment earnings thereon, net of costs of issuance, reserve fund, capitalized interest and administrative expenses and may include net funds generated by the levy of Special Taxes and investment earnings thereon. (d) “Bond Resolution” means that resolution, resolution supplement, fiscal agent agreement, indenture of trust or other equivalent document(s) providing for the issuance of the Bonds. (e) “Bonds” shall mean those bonds, or other securities, issued by, or on behalf of, the CFD in one or more series, as authorized by the qualified electors within Improvement Area No. 1 of which the estimated aggregate amount is not to exceed $11,500,000. (f) “City Fee Facilities” means those City capital improvements eligible to be financed with City Fees. (g) “City Fees” means fees for those capital improvements authorized to be financed with City development impact fees (“DIF”) and all components thereof, imposed by the City as a consequence of development of any portion of the Property to finance City Fee Facilities as further described in Exhibit “C” hereto. For the purposes of this Agreement, DIF is limited to those categories described in Exhibit “C” hereto. City Fee Facilities financed with Bond Proceeds pursuant to this Agreement may include City capital improvements from a single DIF category or multiple DIF categories at the discretion of the City. (h) “Disbursement Request” means a request for payment relating to City Fee Facilities in the form attached hereto as Exhibit “D.” (i) “Improvement Area No. 1” means the area designated as Improvement Area No. 1 on the boundary map of the CFD. (j) “Other Facilities Account of the Improvement Fund” means the fund, account, or sub-account of the CFD (regardless of its designation within the Bond Resolution) into which a portion of the Bond Proceeds may be deposited in accordance with the Bond Resolution to finance City Fee Facilities and which may have subaccounts. (k) “Party” or “Parties” shall mean any or all of the parties to this Agreement. (l) “Rate and Method” means the Rate and Method of Apportionment of the Special Tax authorizing the levy and collection of Special Taxes within Improvement Area No. 1 pursuant to proceedings undertaken for the formation of the CFD and Improvement Area No. 1 pursuant to the Act. (m) “School Facilities” means those public improvements to be owned, operated, or maintained by the School District identified in proceedings to form the CFD that are eligible to be financed with Bond Proceeds. 3.A.7.c Packet Pg. 46 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 4 (n) “Special Taxes” means the special taxes authorized to be levied and collected within Improvement Area No. 1 of the CFD pursuant to the Rate and Method. (o) “State” means the State of California. 3. Formation of the CFD and Improvement Area No. 1. The School District has undertaken to analyze the appropriateness of forming the CFD and Improvement Area No. 1 to finance the City Fee Facilities, and other facilities. The School District has and will retain, at the expense of Property Owner, the necessary consultants to analyze the formation of the CFD. 4. Sale of Bonds and Use of Bond Proceeds. In the event that the CFD is formed and Bonds are issued, the Board of Education of the School District (the “Board”), acting as the legislative body of the CFD, may, in its sole discretion, finance City Fee Facilities by issuing one or more series of Bonds. Prior to the issuance of a series of Bonds that finance City Fee Facilities, the School District shall notify the City of such issuance. If at the time of such notification the City determines that it is unable to comply with tax-exempt requirements for use of the proceeds of the Bonds, the School District shall coordinate with the City as to the portion, if any, of the Bonds to be issued on a taxable basis to finance the City Fee Facilities. To the extent that the CFD and Property Owner determine that Bond Proceeds are available to finance City Fee Facilities, the School District shall notify the City of the amount of such Bond Proceeds deposited in the Other Facilities Account of the Improvement Fund that is available to finance City Fee Facilities. There is no assurance that City Fees will not increase in the future and available Bond Proceeds may be less than anticipated such that Bond Proceeds are not sufficient to fund the anticipated amount of City Fee Facilities in an amount equal to the aggregate total of the applicable City Fees. As Bond Proceeds are transferred to the City and reserved to fund City Fee Facilities as described in Section 5 below, the portion of the Property with respect to which such transfer was made shall receive a credit in the amount transferred against the payment of City Fees with respect to the Property. Nothing herein shall supersede the obligation of an owner of the Property to make Advances or otherwise pay City Fees to the City when due. The purpose of this Agreement is to provide a mechanism by which the CFD may issue the Bonds and levy Special Taxes to provide a source of funds to finance all or a portion of the City Fee Facilities in lieu of the payment of all or a portion of the City Fees. In the event that Bond Proceeds, including investment earnings thereon, are not available or sufficient to fully satisfy the obligation, then Property Owner shall remain obligated to make Advances for which it will receive no reimbursement (except to the extent Bond Proceeds later become available to the City) or pay City Fees to the City as required by the City in accordance with applicable law. The Bonds shall be issued only if, in its sole discretion, the Board determines that all requirements of State and federal law and all School District policies have been satisfied or have been waived by the School District. Nothing in this Agreement shall confer upon the City or any owner of the Property, including Property Owner, a right to compel the issuance of the Bonds or the disbursement of Bond Proceeds to fund City Fee Facilities except in accordance with the terms of this Agreement. 5. Disbursements for City Fee Facilities. (a) Upon the funding of the Other Facilities Account of the Improvement Fund with funds reserved to fund City Fee Facilities, the Property Owner shall notify the City of the amount of Bond Proceeds reserved to fund City Fee Facilities and the Property Owner and the City may execute and submit a Disbursement Request for payment to the School District or the CFD requesting disbursement of an amount equal to all or a portion of the Advances from the Other Facilities Account of the Improvement Fund to the extent that Bond Proceeds are available in the Other Facilities Account of the Improvement Fund for such purpose. Upon the City’s receipt of funds pursuant to such Disbursement Request, the Property Owner shall receive reimbursement of the Advances from the City. To facilitate the City’s 3.A.7.c Packet Pg. 47 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 5 bookkeeping, the City may direct in a Disbursement Request, that all or a portion of a payment be made directly to the Property Owner as reimbursement for Advances made by the Property Owner. In the event of a reimbursement to the Property Owner pursuant to the preceding sentence, the City shall account for an equivalent amount of Advances previously received from the Property Owner in accordance with Section 5(c) below. To the extent that the City expends all or a portion of an Advance pending the deposit of Bond Proceeds in the Other Facilities Account of the Improvement Fund, for purposes of Treasury Regulations regarding investment and expenditure of Bond Proceeds and State law provisions regarding financing of public capital facilities, the Advance shall be considered an interest free loan by the Property Owner, which the City only agrees to repay to the extent of the deposit, if any, of Bond Proceeds in the Other Facilities Account of the Improvement Fund and the City’s written direction as described below to pay all or a portion of such deposit to the Property Owner as repayment of an Advance. (b) From time to time following the funding of the Other Facilities Account of the Improvement Fund, Property Owner may notify the City in writing and the City and Property Owner may jointly request a disbursement from the Other Facilities Account of the Improvement Fund to fund City Fee Facilities by executing and submitting a Disbursement Request. Upon receipt of such Disbursement Request completed in accordance with the terms of this Agreement, the CFD shall wire transfer or otherwise pay to the City (or upon the City’s written direction pay to the Property Owner or a City contractor) such requested funds to the extent that Bond Proceeds are then available, or subsequently become available, in the Other Facilities Account of the Improvement Fund for such purpose. Upon such notice and the City’s receipt of such disbursement (or upon payment to the Property Owner or a City contractor in accordance with directions from the City relating to City Fee Facilities), the Property Owner shall be deemed to have satisfied the portion of the applicable City Fees with respect to the number of dwelling units or lots for which City Fees would otherwise have been required in an amount equal to such disbursement divided by the per lot or unit amount of the applicable City Fees. (c) The City agrees that prior to submitting a Disbursement Request requesting payment from the CFD it shall review and approve all costs included in its request and will have already paid contractually or incurred such costs of City Fee Facilities from its own funds (which may include Advances from the Property Owner) subsequent to the date of this Agreement, or will disburse such amounts to pay the costs of the City Fee Facilities following receipt of funds from the CFD. If the City’s portion of the Bonds are issued on a tax-exempt basis, in the event that (i) the City does not have costs of the City Fee Facilities it has already paid or incurred which it can allocate such Bond Proceeds to or (ii) within five banking days of receipt, the City does not disburse any Bond Proceeds (or equivalent amount of Advances repaid pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) received by it to third parties, it will trace and report to the CFD all earnings, if any, earned by the City, from the date of receipt of such Bond Proceeds by the City (or the date of disbursement pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) to the date of expenditure by the City for capital costs of the City Fee Facilities. Such report shall be delivered at least semi-annually until all Bond Proceeds are expended by the City. If the City’s portion of the Bonds are issued on a tax-exempt basis, the City agrees that in processing the above disbursements it will comply with all legal requirements for the expenditure of Bond Proceeds under the Internal Revenue Code of 1986 and any amendments thereto. (d) Subject to Section 5(e) below, the City agrees to maintain adequate internal controls over its payment function and to maintain accounting records in accordance with generally accepted accounting procedures. The City will, upon request, provide the School District and/or Property Owner with access to the City’s records related to the City Fee Facilities and expenditure of Advances and will provide to the School District its annual financial report certified by an independent certified public accountant for purposes of assisting the School District in calculating the arbitrage rebate obligation of the CFD, if any. 3.A.7.c Packet Pg. 48 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 6 (e) At the City’s discretion, the City may elect to satisfy the tracing and accounting of Bond Proceeds requirements set forth in this Section 5 of this Agreement by selecting and depositing unexpended Bond Proceeds with a commercial bank, savings bank, savings and loan association, or other financial institution, which is authorized by law to accept, hold, trace, and account for deposits of money (the “Deposit Institution”). Property Owner shall pay for all costs and expenses associated with such Deposit Institution and shall pay said costs and expenses as provided in the written direction of the City. (f) The School District or the CFD agrees to maintain full and accurate records of all amounts, and investment earnings, if any, expended from the Other Facilities Account of the Improvement Fund and expenditure of Advances. The School District or the CFD will, upon request, provide the City and/or Property Owner with access to the School District’s or the CFD’s records related to the Other Facilities Account of the Improvement Fund. (g) As a condition to receiving Bond Proceeds, the City agrees that it shall provide to the School District a certificate substantially in the form attached hereto as Exhibit “E.” 6. Ownership of City Fee Facilities; Payment of Administrative Fees. The City Fee Facilities, once acquired, shall be and remain the property of the City. 7. Indemnification. (a) Indemnification by the School District. The School District shall assume the defense of, indemnify and save harmless, the City and its respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the School District with respect to this Agreement and the issuance of the Bonds; provided, however, that the School District shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. (b) Indemnification by Property Owner. Property Owner shall assume the defense of, indemnify and save harmless, the School District, the CFD, and the City, their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of Property Owner with respect to this Agreement; including any actions, damages, claims, losses, or expenses relating to compliance with the Improvement and Credit Agreement and the Transportation Uniform Mitigation Fee (“TUMF”) Program Administrative Plan adopted by Western Riverside Council of Governments; provided, however, that Property Owner shall not be required to indemnify any person or entity as to damages resulting from the negligence or willful misconduct of such person or entity or their officers, agents, or employees. (c) Indemnification by the City. The City shall assume the defense of, indemnify and save harmless, the School District, the CFD and their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the City with respect to this Agreement, and the design, engineering, and construction of the City Fee Facilities constructed by the City; provided, however, that the City shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. 3.A.7.c Packet Pg. 49 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 7 8. Allocation of Special Taxes. The Board, as the legislative body of the CFD, shall annually levy the Special Taxes as provided for in the formation proceedings of the CFD. The entire amount of any Special Taxes levied by the CFD to repay Bonds, or to fund other obligations, shall be allocated to the CFD. 9. Amendment and Assignment. This Agreement may be amended at any time but only in writing signed by each Party hereto. This Agreement may be assigned, in whole or in part, by Property Owner to the purchaser of any parcel of land within the Property, provided, however, such assignment shall not be effective unless and until the City and the School District have been notified, in writing, of such assignment and the assignment specifies whether the Property Owner or such assignee is authorized to execute disbursement requests and whether the Property Owner or such assignee is to be reimbursed for Advances which have not been reimbursed at the time of such notice. 10. Entire Agreement. This Agreement contains the entire 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. 11. Notices. Any notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication required or permitted by this Agreement to be given or delivered hereunder to any other Party shall be in writing and deemed to have been received (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, whether by telex, telegram, telecopier, or email upon the sender’s receipt of an appropriate answer back or other written acknowledgement from the addressee of successful transmission, (c) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by Federal Express or other overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon the sender’s receipt of written acknowledgement from the addressee, addressed as follows: School District: San Jacinto Unified School District 2045 S. San Jacinto Ave. San Jacinto, CA 92583 Attn: Assistant Superintendent, Business Services Email: sheeren@sanjacinto.k12.ca.us With a copy to: James F. Anderson Law Firm, A Professional Corporation Attn: James F. Anderson, Bond Counsel 24001 Calle Magdalena, #3348 Laguna Hills, CA 92654 Email: jim.anderson@jfandersonlaw.com City: City of San Jacinto 595 S. San Jacinto Avenue San Jacinto, CA 92583 Attn: City Manager Email: Citymanager@sanjacintoca.gov With a copy to: Best Best & Krieger LLP 300 S. Grand Ave. Los Angeles, CA 90071 Attn: Michael Maurer 3.A.7.c Packet Pg. 50 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 8 Property Owner: D.R. Horton Los Angeles Holding Company, Inc. 2280 Wardlow Circle, Suite 100 Corona, CA 92880 Attn: Barbara Murakami (Scull) Email: bmmurakami@drhorton.com With a copy to: O’Neil LLP 19900 MacArthur Boulevard, Suite 1050 Irvine, CA 92612 Attention: Sandra Galle, Esq. Phone: (949) 798-0725 Email: sgalle@oneil-llp.com Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Parties hereto. 12. Exhibits. All exhibits attached hereto are incorporated into this Agreement by reference. 13. Attorneys’ Fees. In the event of the bringing of any action or suit by any Party against any other Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the losing Party all costs and expenses of suit, including reasonable attorneys’ fees. 14. Interpretation in the Event of Ambiguities or Disputes. The Parties acknowledge and agree that each has been given the opportunity to review this Agreement with legal counsel independently, and/or has the requisite experience and sophistication to understand, interpret, and agree to the particular language of the provisions hereof. In the event of an ambiguity in or dispute regarding the interpretation of same, the interpretation of this Agreement shall not be resolved by any rule of interpretation providing for interpretation against the Party who causes the uncertainty to exist or against the drafter. 15. 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. 16. Governing Law; Venue. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Venue of any action brought hereunder will be in the Superior Court of the State within Riverside County, California, and the Parties consent to the exercise of personal jurisdiction over them by any such courts for purposes of any such action or proceeding. The Parties expressly waive any right to transfer venue, including, but not limited to, any right to transfer venue pursuant to California Civil Code Section 394. 17. Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by any other Party hereto, or the failure by a Party to exercise its rights upon the default of any other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Party with the terms of this Agreement thereafter. 18. No Third Party Beneficiaries. No person or entity other than the CFD, when and if formed, 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 School District, the CFD, 3.A.7.c Packet Pg. 51 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 9 and Property Owner (and their respective successors and assigns, exclusive of individual homebuyers), any rights, remedies, obligations, or liabilities under or by reason of this Agreement. 19. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 20. 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. 21. Termination. This Agreement shall terminate upon the earliest occurrence of the following events: (a) the dissolution pursuant to Section 53338.5 of the Act of the CFD; or (b) the written agreement of the City, the School District, and the Property Owner to terminate this Agreement. Notwithstanding the foregoing, this Agreement shall remain in full force and effect for as long as any Bonds are outstanding. 22. Captions. Captions to sections of this Agreement are for convenience purposes only and are not part of this Agreement. [Remainder of page intentionally left blank] 3.A.7.c Packet Pg. 52 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) 10 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year written above. SAN JACINTO UNIFIED SCHOOL DISTRICT ____________________________ Assistant Superintendent, Business Services CITY OF SAN JACINTO By: City Manager ATTEST: By: ____________________________ City Clerk APPROVED AS TO FORM: By: ____________________________ City Attorney PROPERTY OWNER D.R. HORTON LOS ANGELES HOLDING COMPANY, INC., a California corporation By: _____________________________________ Barbara M. Scull, Vice President 3.A.7.c Packet Pg. 53 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) A-1 EXHIBIT “A” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 1) BOUNDARY MAP; DEPICTION OF PROPERTY 3.A.7.c Packet Pg. 54 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1OF THE SAN JACINTO UNIFIED SCHOOL DISTRICTOF THE SAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY OF RIVERSIDESTATE OF CALIFORNIAFILED IN THE OFFICE OF THE CLERK OF THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, THIS _____ DAY OF _____________, 202__.__________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTI HEREBY CERTIFY THAT THE WITHIN MAP SHOWING THE PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, WAS APPROVED BY THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT AT A REGULAR MEETING THEREOF, HELD ON THE ________ DAY OF ______________, 202__, BY ITS RESOLUTION NO. ____________________. __________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY RECORDER'S CERTIFICATE:FILED THIS ______ DAY OF _________________, 202__, AT THE HOUR OF ______ O'CLOCK ____ .M., IN BOOK _________, OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AT PAGES _______, AS INSTRUMENT NO. _______________________________, IN THE OFFICE OF THE COUNTY RECORDER OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AT THE REQUEST OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT.__________________________________PETER ALDANA, ASSESSOR - COUNTY CLERK - RECORDERCOUNTY OF RIVERSIDEBY DEPUTYTHE LINES AND DIMENSIONS OF EACH LOT OR PARCEL SHOWN ON THIS MAP SHALL BE THOSE LINES AND DIMENSIONS AS SHOWN ON THE RIVERSIDE COUNTY ASSESSOR'S MAPS FOR THOSE PARCELS LISTED.THE RIVERSIDE COUNTY ASSESSOR'S MAPS SHALL GOVERN FOR ALL DETAILS CONCERNING THE LINES AND DIMENSIONS OF SUCH LOTS OR PARCELS..MAIN STRAMO N A E X P Y ALESSANDRO AVESAN JACINTO AVESITEVICINITY MAPN VERNON AVESHEET 1 OF 1LegendPROPOSED DISTRICT BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2021-1IMPROVEMENT AREA NO. 1IMPROVEMENT AREA NO. 2IMPROVEMENT AREA NO. 3REMAINDER - NOT A PART123456789101112N CAMINO LOS BANOS ALESSANDRO AVEBURT STRAMONA EXPRESSWAY13MAP REFERENCE NUMBERASSESSOR'S PARCEL NUMBERIMPROVEMENT AREA1 433-070-051 32 433-110-020 33 433-110-040 34 434-190-007 35 434-190-008 36 434-230-003 27 434-230-004 28 434-250-002 29 434-271-026 210 434-300-012 111 434-300-013 112 434-300-016 113 434-300-017 13.A.7.cPacket Pg. 55Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) B-1 EXHIBIT “B” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 1) DESCRIPTION OF PROPERTY Real property in the City of San Jacinto, County of Riverside, State of California, described as follows: Assessor’s Parcel No. Improvement Area No. 1: 434-300-017 434-300-016 434-300-013 434-300-012 3.A.7.c Packet Pg. 56 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) C-1 EXHIBIT “C” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT CITY FEE FACILITIES 1. City Fee Facilities. The type of City Fee Facilities eligible to be financed by the CFD under the Act consist of the construction, acquisition, modification, expansion, maintenance and/or rehabilitation of capital improvements authorized to be financed with City of San Jacinto (the “City”) development impact fees (“DIF”) (which does not include any impact fees passed through to a Riverside County agency (e.g., Western Riverside Council of Governments Transportation Uniform Mitigation Fee)), including, but not limited to, interchange improvements, streets and street improvements, traffic signalizations, storm drains, flood control, sewer, water capital improvements, trails, fire facilities, police facilities, public safety, parkland facilities, park facilities, recreation center facilities, open space facilities, library facilities, City Hall facilities, corporate yard facilities, maintenance facilities, animal shelter facilities, government services, community amenities, and all appurtenances and appurtenant work in connection with the foregoing, including the cost of engineering, planning, designing, materials testing, coordination, construction staking, construction management and supervision for such City Fee Facilities, and any other expense incidental to the construction, acquisition, modification, expansion or rehabilitation of such City Fee Facilities, all as permitted under the provisions of the Mello-Roos Community Facilities Act of 1982, as amended. The amount of the City Fee Facilities will be based on the applicable fee schedule, which is subject to change. 3.A.7.c Packet Pg. 57 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) D-1 Sequence No. _____ City SA# _____ EXHIBIT “D” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT DISBURSEMENT REQUEST FORM 1. Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is hereby requested to pay from Bond Proceeds relating to Improvement Area No. 1 to the City of San Jacinto (the “City”), as Payee, or to the City’s designee, the sum set forth in 3 below. 2. The undersigned certifies that the amount requested for City Fee Facilities is due and payable, has not formed the basis of prior request or payment, and is being made with respect to the Joint Community Facilities Agreement by and among San Jacinto Unified School District, City of San Jacinto, and D.R. Horton Los Angeles Holding Company, Inc., a California corporation, dated April 1, 2022 (the “JCFA”). 3. Amount requested: $________________ For Tract / Lot Nos: ______________ within Improvement Area No. 1 4. The amount set forth in 3 above is authorized and payable pursuant to the terms of the JCFA. Capitalized terms not defined herein shall have the meaning set forth in the JCFA. The City shall spend the Bond Proceeds allocated hereby in accordance with the requirements set forth in Section 5 of the JCFA. By entering into the JCFA and requisitioning Bond Proceeds as described herein, the City is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California state income tax purposes. PROPERTY OWNER D.R. HORTON LOS ANGELES HOLDING COMPANY, INC., a California corporation By: ____[Form; do not sign]____________ Barbara M. Scull, Vice President CITY OF SAN JACINTO By: [Form, do not sign] Name: Title: ATTEST: By: [Form, do not sign] Clerk of the City cc: City Finance Dept. 3.A.7.c Packet Pg. 58 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) E-1 EXHIBIT “E” FORM OF CITY CERTIFICATION COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 1) 20__ SPECIAL TAX BONDS (IMPROVEMENT AREA NO. 1) CERTIFICATE OF THE CITY OF SAN JACINTO WHEREAS, Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is issuing the above-captioned bonds (the “Bonds”) for the purpose of financing certain infrastructure capital improvements, including the capital expenditures of facilities owned by the City of San Jacinto (the “City”); WHEREAS, the CFD will make available to the City $__________ of Bond proceeds (the “Proceeds”); WHEREAS, the City has read and understands the restrictions of the Tax Certificate (the “Tax Certificate”) of the CFD, dated __________, 20__, with respect to the Bonds; NOW, THEREFORE, the City covenants the following: 1. The City will expend the Proceeds on capital costs (the “Costs”) paid to third parties for City improvements or equipment (the “City Project”). 2. The City will maintain records regarding the investment and expenditure of the Proceeds and the usage of the City Project. 3. The City will cooperate with the CFD regarding compliance with the terms of the Tax Certificate, including remitting any rebatable arbitrage on the Proceeds, if any, to the CFD to comply with the restrictions of Section 148(f) of the Code. 4. None of the City will be subject to Private Use (as defined in the Tax Certificate) absent consent of the CFD. All terms not defined herein have the meaning ascribed in the attached Tax Certificate. Dated: _________, 20__ CITY OF SAN JACINTO By: [Form, do not sign] [Name] [Title] 3.A.7.c Packet Pg. 59 Attachment: Exhibit C - Joint Community Facilities Agreement IA 1 (JCFA Approval - Starling Point) JOINT COMMUNITY FACILITIES AGREEMENT relating to Community Facilities District No. 2022-1 of the San Jacinto Unified School District Improvement Area No. 2 by and among San Jacinto Unified School District, City of San Jacinto and D.R. HORTON LOS ANGELES HOLDING COMPANY, INC., A CALIFORNIA CORPORATION THIS JOINT COMMUNITY FACILITIES AGREEMENT (the “Agreement”) is entered into effective as of the 1st day of April, 2022, by and among SAN JACINTO UNIFIED SCHOOL DISTRICT, a California unified school district (“School District”), the CITY OF SAN JACINTO, a California general law city (the “City”) and D.R. Horton Los Angeles Holding Company, Inc., a California corporation (“Property Owner”). This Agreement relates to the formation by the School District of a community facilities district known as “Community Facilities District No. 2022-1 of the San Jacinto Unified School District” (the “CFD”), and the establishment of Improvement Area No. 2 therein (“Improvement Area No. 2”) for the purpose of financing certain facilities to be constructed, owned, operated, or maintained by the School District, the City and Eastern Municipal Water District as a consequence of the development within the CFD to be used by the City to construct facilities to be owned and operated by the City from the proceeds of bonds issued by the CFD with respect to Improvement Area No. 2 and the proceeds of special taxes levied by the CFD with respect to Improvement Area No. 2. The CFD will also establish other improvement areas therein known as Improvement Area No. 1 (“Improvement Area No. 1”) and Improvement Area No. 3 (“Improvement Area No. 3”) (each an “Improvement Area” and together the “Improvement Areas”). R E C I T A L S: A.The property is depicted in Exhibit “A” and described in Exhibit “B” hereto (the “Property”), which is located in the City of San Jacinto, County of Riverside, State of California, and constitutes the land within the boundaries of proposed Improvement Area No. 2, proposed Improvement Area No. 1, and proposed Improvement Area No. 3 of the CFD. B.As of April 1, 2022, Property Owner owns the Property and intends to develop the Property for residential purposes consisting of Improvement Area No. 1 (177 single family residential units in Tract No. 30379) and Improvement Area No. 2 (192 single family residential units in Tract No. 32582). C.Property Owner petitioned the School District to form the CFD and the applicable Improvement Areas for the purpose of financing, among other things, the construction of various public facilities to be owned and operated by the City as described in Exhibit “C” hereto, which facilities will benefit the Property in whole or in part, including certain public facilities to be constructed, owned and operated by the City (the “City Fee Facilities”) in lieu of the payment of City Fees (defined below). D.Property Owner has yet to determine whether it will finance any or all of the City Fee Facilities, in lieu of payment of City Fees, with Bond Proceeds (defined below) that are available for such 3.A.7.d Packet Pg. 60 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 2 purpose. The Parties (defined below) hereto acknowledge that the purpose of this Agreement is to satisfy the requirements of the Act (defined below). E. In conjunction with the issuance of building permits for the construction of homes within Improvement Area No. 2, the Property Owner, or its successors or assigns, may elect to advance City Fee Facilities costs in lieu of payment of City Fees (the “Advance(s)”) at such times as Bond Proceeds are not available in sufficient amounts to pay for City Fee Facilities. In such case, the Property Owner shall be entitled to (i) reimbursement of such Advances limited to Bond Proceeds available to the City, if any (the Advances being considered an interest free loan by the Property Owner with no repayment obligation except to the extent there are Bond Proceeds received by or made available to the City as described herein, all as further described in Section 5(a) below) and (ii) credit for payments made to the City from Bond Proceeds against City Fees which would otherwise be due to the City with respect to the Property for which such transfer was made equal to the amount of Bond Proceeds disbursed to the City or at the direction of the City for City Fee Facilities, all as further described herein. F. In addition to the City Fee Facilities, certain facilities to be owned and operated by the School District (the “School Facilities”) and certain facilities to be owned and operated by Eastern Municipal Water District (“EMWD”) are also expected to be funded from Bond Proceeds. G. The School District has sole discretion and responsibility for the formation and administration of the CFD. H. The School District is authorized by Section 53313.5 of the Act to assist in the financing of the acquisition and/or construction of the City Fee Facilities. This Agreement constitutes a joint community facilities agreement, within the meaning of Section 53316.2 of the Act, by and among the City, the Property Owner, and the School District, pursuant to which the CFD, when and if the CFD and Improvement Area No. 2 are formed, will be authorized to finance the acquisition and/or construction of all or a portion of the City Fee Facilities. As authorized by Section 53316.6 of the Act, responsibility for constructing, providing for, and operating the City Fee Facilities is delegated to the City. I. The Parties (defined below) hereto find and determine that the residents residing within the boundaries of the City, the School District, and Improvement Area No. 2 of the CFD will be benefited by the construction and/or acquisition of the School Facilities and City Fee Facilities and that this Agreement is beneficial to the interests of such residents. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties hereto agree as follows: 1.Recitals. Each of the above recitals is incorporated herein and is true and correct. 2.Definitions. Unless the context clearly otherwise requires, the terms defined in this Section shall, for all purposes of this Agreement, have the meanings herein specified. (a)“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code. 3.A.7.d Packet Pg. 61 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 3 (b) “Advance” or “Advances” means an amount advanced by Property Owner to the City for City Fee Facilities in lieu of payment of City Fees prior to the availability of sufficient Bond Proceeds. Advances shall be deemed payment of City Fees to the extent sufficient Bond Proceeds are not received by or made available to the City. (c)“Bond Proceeds” or “Proceeds of the Bonds” shall mean those net funds generated by the sale of the Bonds and investment earnings thereon, net of costs of issuance, reserve fund, capitalized interest and administrative expenses and may include net funds generated by the levy of Special Taxes and investment earnings thereon. (d) “Bond Resolution” means that resolution, resolution supplement, fiscal agent agreement, indenture of trust or other equivalent document(s) providing for the issuance of the Bonds. (e)“Bonds” shall mean those bonds, or other securities, issued by, or on behalf of, the CFD in one or more series, as authorized by the qualified electors within Improvement Area No. 2 of which the estimated aggregate amount is not to exceed $12,000,000. (f)“City Fee Facilities” means those City capital improvements eligible to be financed with City Fees. (g)“City Fees” means fees for those capital improvements authorized to be financed with City development impact fees (“DIF”) and all components thereof, imposed by the City as a consequence of development of any portion of the Property to finance City Fee Facilities as further described in Exhibit “C” hereto. For the purposes of this Agreement, DIF is limited to those categories described in Exhibit “C” hereto. City Fee Facilities financed with Bond Proceeds pursuant to this Agreement may include City capital improvements from a single DIF category or multiple DIF categories at the discretion of the City. (h) “Disbursement Request” means a request for payment relating to City Fee Facilities in the form attached hereto as Exhibit “D.” (i)“Improvement Area No. 2” means the area designated as Improvement Area No. 2 on the boundary map of the CFD. (j)“Other Facilities Account of the Improvement Fund” means the fund, account, or sub-account of the CFD (regardless of its designation within the Bond Resolution) into which a portion of the Bond Proceeds may be deposited in accordance with the Bond Resolution to finance City Fee Facilities and which may have subaccounts. (k)“Party” or “Parties” shall mean any or all of the parties to this Agreement. (l)“Rate and Method” means the Rate and Method of Apportionment of the Special Tax authorizing the levy and collection of Special Taxes within Improvement Area No. 2 pursuant to proceedings undertaken for the formation of the CFD and Improvement Area No. 2 pursuant to the Act. (m)“School Facilities” means those public improvements to be owned, operated, or maintained by the School District identified in proceedings to form the CFD that are eligible to be financed with Bond Proceeds. 3.A.7.d Packet Pg. 62 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 4 (n) “Special Taxes” means the special taxes authorized to be levied and collected within Improvement Area No. 2 of the CFD pursuant to the Rate and Method. (o) “State” means the State of California. 3. Formation of the CFD and Improvement Area No. 2. The School District has undertaken to analyze the appropriateness of forming the CFD and Improvement Area No. 2 to finance the City Fee Facilities, and other facilities. The School District has and will retain, at the expense of Property Owner, the necessary consultants to analyze the formation of the CFD. 4. Sale of Bonds and Use of Bond Proceeds. In the event that the CFD is formed and Bonds are issued, the Board of Education of the School District (the “Board”), acting as the legislative body of the CFD, may, in its sole discretion, finance City Fee Facilities by issuing one or more series of Bonds. Prior to the issuance of a series of Bonds that finance City Fee Facilities, the School District shall notify the City of such issuance. If at the time of such notification the City determines that it is unable to comply with tax-exempt requirements for use of the proceeds of the Bonds, the School District shall coordinate with the City as to the portion, if any, of the Bonds to be issued on a taxable basis to finance the City Fee Facilities. To the extent that the CFD and Property Owner determine that Bond Proceeds are available to finance City Fee Facilities, the School District shall notify the City of the amount of such Bond Proceeds deposited in the Other Facilities Account of the Improvement Fund that is available to finance City Fee Facilities. There is no assurance that City Fees will not increase in the future and available Bond Proceeds may be less than anticipated such that Bond Proceeds are not sufficient to fund the anticipated amount of City Fee Facilities in an amount equal to the aggregate total of the applicable City Fees. As Bond Proceeds are transferred to the City and reserved to fund City Fee Facilities as described in Section 5 below, the portion of the Property with respect to which such transfer was made shall receive a credit in the amount transferred against the payment of City Fees with respect to the Property. Nothing herein shall supersede the obligation of an owner of the Property to make Advances or otherwise pay City Fees to the City when due. The purpose of this Agreement is to provide a mechanism by which the CFD may issue the Bonds and levy Special Taxes to provide a source of funds to finance all or a portion of the City Fee Facilities in lieu of the payment of all or a portion of the City Fees. In the event that Bond Proceeds, including investment earnings thereon, are not available or sufficient to fully satisfy the obligation, then Property Owner shall remain obligated to make Advances for which it will receive no reimbursement (except to the extent Bond Proceeds later become available to the City) or pay City Fees to the City as required by the City in accordance with applicable law. The Bonds shall be issued only if, in its sole discretion, the Board determines that all requirements of State and federal law and all School District policies have been satisfied or have been waived by the School District. Nothing in this Agreement shall confer upon the City or any owner of the Property, including Property Owner, a right to compel the issuance of the Bonds or the disbursement of Bond Proceeds to fund City Fee Facilities except in accordance with the terms of this Agreement. 5. Disbursements for City Fee Facilities. (a) Upon the funding of the Other Facilities Account of the Improvement Fund with funds reserved to fund City Fee Facilities, the Property Owner shall notify the City of the amount of Bond Proceeds reserved to fund City Fee Facilities and the Property Owner and the City may execute and submit a Disbursement Request for payment to the School District or the CFD requesting disbursement of an amount equal to all or a portion of the Advances from the Other Facilities Account of the Improvement Fund to the extent that Bond Proceeds are available in the Other Facilities Account of the Improvement Fund for such purpose. Upon the City’s receipt of funds pursuant to such Disbursement Request, the Property Owner shall receive reimbursement of the Advances from the City. To facilitate the City’s 3.A.7.d Packet Pg. 63 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 5 bookkeeping, the City may direct in a Disbursement Request, that all or a portion of a payment be made directly to the Property Owner as reimbursement for Advances made by the Property Owner. In the event of a reimbursement to the Property Owner pursuant to the preceding sentence, the City shall account for an equivalent amount of Advances previously received from the Property Owner in accordance with Section 5(c) below. To the extent that the City expends all or a portion of an Advance pending the deposit of Bond Proceeds in the Other Facilities Account of the Improvement Fund, for purposes of Treasury Regulations regarding investment and expenditure of Bond Proceeds and State law provisions regarding financing of public capital facilities, the Advance shall be considered an interest free loan by the Property Owner, which the City only agrees to repay to the extent of the deposit, if any, of Bond Proceeds in the Other Facilities Account of the Improvement Fund and the City’s written direction as described below to pay all or a portion of such deposit to the Property Owner as repayment of an Advance. (b) From time to time following the funding of the Other Facilities Account of the Improvement Fund, Property Owner may notify the City in writing and the City and Property Owner may jointly request a disbursement from the Other Facilities Account of the Improvement Fund to fund City Fee Facilities by executing and submitting a Disbursement Request. Upon receipt of such Disbursement Request completed in accordance with the terms of this Agreement, the CFD shall wire transfer or otherwise pay to the City (or upon the City’s written direction pay to the Property Owner or a City contractor) such requested funds to the extent that Bond Proceeds are then available, or subsequently become available, in the Other Facilities Account of the Improvement Fund for such purpose. Upon such notice and the City’s receipt of such disbursement (or upon payment to the Property Owner or a City contractor in accordance with directions from the City relating to City Fee Facilities), the Property Owner shall be deemed to have satisfied the portion of the applicable City Fees with respect to the number of dwelling units or lots for which City Fees would otherwise have been required in an amount equal to such disbursement divided by the per lot or unit amount of the applicable City Fees. (c) The City agrees that prior to submitting a Disbursement Request requesting payment from the CFD it shall review and approve all costs included in its request and will have already paid contractually or incurred such costs of City Fee Facilities from its own funds (which may include Advances from the Property Owner) subsequent to the date of this Agreement, or will disburse such amounts to pay the costs of the City Fee Facilities following receipt of funds from the CFD. If the City’s portion of the Bonds are issued on a tax-exempt basis, in the event that (i) the City does not have costs of the City Fee Facilities it has already paid or incurred which it can allocate such Bond Proceeds to or (ii) within five banking days of receipt, the City does not disburse any Bond Proceeds (or equivalent amount of Advances repaid pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) received by it to third parties, it will trace and report to the CFD all earnings, if any, earned by the City, from the date of receipt of such Bond Proceeds by the City (or the date of disbursement pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) to the date of expenditure by the City for capital costs of the City Fee Facilities. Such report shall be delivered at least semi-annually until all Bond Proceeds are expended by the City. If the City’s portion of the Bonds are issued on a tax-exempt basis, the City agrees that in processing the above disbursements it will comply with all legal requirements for the expenditure of Bond Proceeds under the Internal Revenue Code of 1986 and any amendments thereto. (d) Subject to Section 5(e) below, the City agrees to maintain adequate internal controls over its payment function and to maintain accounting records in accordance with generally accepted accounting procedures. The City will, upon request, provide the School District and/or Property Owner with access to the City’s records related to the City Fee Facilities and expenditure of Advances and will provide to the School District its annual financial report certified by an independent certified public accountant for purposes of assisting the School District in calculating the arbitrage rebate obligation of the CFD, if any. 3.A.7.d Packet Pg. 64 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 6 (e) At the City’s discretion, the City may elect to satisfy the tracing and accounting of Bond Proceeds requirements set forth in this Section 5 of this Agreement by selecting and depositing unexpended Bond Proceeds with a commercial bank, savings bank, savings and loan association, or other financial institution, which is authorized by law to accept, hold, trace, and account for deposits of money (the “Deposit Institution”). Property Owner shall pay for all costs and expenses associated with such Deposit Institution and shall pay said costs and expenses as provided in the written direction of the City. (f) The School District or the CFD agrees to maintain full and accurate records of all amounts, and investment earnings, if any, expended from the Other Facilities Account of the Improvement Fund and expenditure of Advances. The School District or the CFD will, upon request, provide the City and/or Property Owner with access to the School District’s or the CFD’s records related to the Other Facilities Account of the Improvement Fund. (g) As a condition to receiving Bond Proceeds, the City agrees that it shall provide to the School District a certificate substantially in the form attached hereto as Exhibit “E.” 6. Ownership of City Fee Facilities; Payment of Administrative Fees. The City Fee Facilities, once acquired, shall be and remain the property of the City. 7. Indemnification. (a) Indemnification by the School District. The School District shall assume the defense of, indemnify and save harmless, the City and its respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the School District with respect to this Agreement and the issuance of the Bonds; provided, however, that the School District shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. (b) Indemnification by Property Owner. Property Owner shall assume the defense of, indemnify and save harmless, the School District, the CFD, and the City, their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of Property Owner with respect to this Agreement; including any actions, damages, claims, losses, or expenses relating to compliance with the Improvement and Credit Agreement and the Transportation Uniform Mitigation Fee (“TUMF”) Program Administrative Plan adopted by Western Riverside Council of Governments; provided, however, that Property Owner shall not be required to indemnify any person or entity as to damages resulting from the negligence or willful misconduct of such person or entity or their officers, agents, or employees. (c) Indemnification by the City. The City shall assume the defense of, indemnify and save harmless, the School District, the CFD and their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the City with respect to this Agreement, and the design, engineering, and construction of the City Fee Facilities constructed by the City; provided, however, that the City shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. 3.A.7.d Packet Pg. 65 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 7 8. Allocation of Special Taxes. The Board, as the legislative body of the CFD, shall annually levy the Special Taxes as provided for in the formation proceedings of the CFD. The entire amount of any Special Taxes levied by the CFD to repay Bonds, or to fund other obligations, shall be allocated to the CFD. 9. Amendment and Assignment. This Agreement may be amended at any time but only in writing signed by each Party hereto. This Agreement may be assigned, in whole or in part, by Property Owner to the purchaser of any parcel of land within the Property, provided, however, such assignment shall not be effective unless and until the City and the School District have been notified, in writing, of such assignment and the assignment specifies whether the Property Owner or such assignee is authorized to execute disbursement requests and whether the Property Owner or such assignee is to be reimbursed for Advances which have not been reimbursed at the time of such notice. 10. Entire Agreement. This Agreement contains the entire 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. 11. Notices. Any notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication required or permitted by this Agreement to be given or delivered hereunder to any other Party shall be in writing and deemed to have been received (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, whether by telex, telegram, telecopier, or email upon the sender’s receipt of an appropriate answer back or other written acknowledgement from the addressee of successful transmission, (c) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by Federal Express or other overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon the sender’s receipt of written acknowledgement from the addressee, addressed as follows: School District: San Jacinto Unified School District 2045 S. San Jacinto Ave. San Jacinto, CA 92583 Attn: Assistant Superintendent, Business Services Email: sheeren@sanjacinto.k12.ca.us With a copy to: James F. Anderson Law Firm, A Professional Corporation Attn: James F. Anderson, Bond Counsel 24001 Calle Magdalena, #3348 Laguna Hills, CA 92654 Email: jim.anderson@jfandersonlaw.com City: City of San Jacinto 595 S. San Jacinto Avenue San Jacinto, CA 92583 Attn: City Manager Email: Citymanager@sanjacintoca.gov With a copy to: Best Best & Krieger LLP 300 S. Grand Ave. Los Angeles, CA 90071 Attn: Michael Maurer 3.A.7.d Packet Pg. 66 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 8 Property Owner: D.R. Horton Los Angeles Holding Company, Inc. 2280 Wardlow Circle, Suite 100 Corona, CA 92880 Attn: Barbara Murakami (Scull) Email: bmmurakami@drhorton.com With a copy to: O’Neil LLP 19900 MacArthur Boulevard, Suite 1050 Irvine, CA 92612 Attention: Sandra Galle, Esq. Phone: (949) 798-0725 Email: sgalle@oneil-llp.com Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Parties hereto. 12. Exhibits. All exhibits attached hereto are incorporated into this Agreement by reference. 13. Attorneys’ Fees. In the event of the bringing of any action or suit by any Party against any other Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the losing Party all costs and expenses of suit, including reasonable attorneys’ fees. 14. Interpretation in the Event of Ambiguities or Disputes. The Parties acknowledge and agree that each has been given the opportunity to review this Agreement with legal counsel independently, and/or has the requisite experience and sophistication to understand, interpret, and agree to the particular language of the provisions hereof. In the event of an ambiguity in or dispute regarding the interpretation of same, the interpretation of this Agreement shall not be resolved by any rule of interpretation providing for interpretation against the Party who causes the uncertainty to exist or against the drafter. 15. 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. 16. Governing Law; Venue. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Venue of any action brought hereunder will be in the Superior Court of the State within Riverside County, California, and the Parties consent to the exercise of personal jurisdiction over them by any such courts for purposes of any such action or proceeding. The Parties expressly waive any right to transfer venue, including, but not limited to, any right to transfer venue pursuant to California Civil Code Section 394. 17. Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by any other Party hereto, or the failure by a Party to exercise its rights upon the default of any other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Party with the terms of this Agreement thereafter. 18. No Third Party Beneficiaries. No person or entity other than the CFD, when and if formed, 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 School District, the CFD, and Property Owner (and their respective successors and assigns, exclusive of individual homebuyers), any rights, remedies, obligations, or liabilities under or by reason of this Agreement. 3.A.7.d Packet Pg. 67 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) 9 19. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 20. 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. 21. Termination. This Agreement shall terminate upon the earliest occurrence of the following events: (a) the dissolution pursuant to Section 53338.5 of the Act of the CFD; or (b) the written agreement of the City, the School District, and the Property Owner to terminate this Agreement. Notwithstanding the foregoing, this Agreement shall remain in full force and effect for as long as any Bonds are outstanding. 22. Captions. Captions to sections of this Agreement are for convenience purposes only and are not part of this Agreement [Remainder of page intentionally left blank] 3.A.7.d Packet Pg. 68 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) S-1 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year written above. SAN JACINTO UNIFIED SCHOOL DISTRICT ____________________________ Assistant Superintendent, Business Services CITY OF SAN JACINTO By: City Manager ATTEST: By: ____________________________ City Clerk APPROVED AS TO FORM: By: ____________________________ City Attorney PROPERTY OWNER D.R. HORTON LOS ANGELES HOLDING COMPANY, INC., a California corporation By: _____________________________________ Barbara M. Scull, Vice President 3.A.7.d Packet Pg. 69 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) A-1 EXHIBIT “A” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 2) BOUNDARY MAP; DEPICTION OF PROPERTY 3.A.7.d Packet Pg. 70 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1OF THE SAN JACINTO UNIFIED SCHOOL DISTRICTOF THE SAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY OF RIVERSIDESTATE OF CALIFORNIAFILED IN THE OFFICE OF THE CLERK OF THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, THIS _____ DAY OF _____________, 202__.__________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTI HEREBY CERTIFY THAT THE WITHIN MAP SHOWING THE PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, WAS APPROVED BY THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT AT A REGULAR MEETING THEREOF, HELD ON THE ________ DAY OF ______________, 202__, BY ITS RESOLUTION NO. ____________________. __________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY RECORDER'S CERTIFICATE:FILED THIS ______ DAY OF _________________, 202__, AT THE HOUR OF ______ O'CLOCK ____ .M., IN BOOK _________, OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AT PAGES _______, AS INSTRUMENT NO. _______________________________, IN THE OFFICE OF THE COUNTY RECORDER OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AT THE REQUEST OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT.__________________________________PETER ALDANA, ASSESSOR - COUNTY CLERK - RECORDERCOUNTY OF RIVERSIDEBY DEPUTYTHE LINES AND DIMENSIONS OF EACH LOT OR PARCEL SHOWN ON THIS MAP SHALL BE THOSE LINES AND DIMENSIONS AS SHOWN ON THE RIVERSIDE COUNTY ASSESSOR'S MAPS FOR THOSE PARCELS LISTED.THE RIVERSIDE COUNTY ASSESSOR'S MAPS SHALL GOVERN FOR ALL DETAILS CONCERNING THE LINES AND DIMENSIONS OF SUCH LOTS OR PARCELS..MAIN STRAMO N A E X P Y ALESSANDRO AVESAN JACINTO AVESITEVICINITY MAPN VERNON AVESHEET 1 OF 1LegendPROPOSED DISTRICT BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2021-1IMPROVEMENT AREA NO. 1IMPROVEMENT AREA NO. 2IMPROVEMENT AREA NO. 3REMAINDER - NOT A PART123456789101112N CAMINO LOS BANOS ALESSANDRO AVEBURT STRAMONA EXPRESSWAY13MAP REFERENCE NUMBERASSESSOR'S PARCEL NUMBERIMPROVEMENT AREA1 433-070-051 32 433-110-020 33 433-110-040 34 434-190-007 35 434-190-008 36 434-230-003 27 434-230-004 28 434-250-002 29 434-271-026 210 434-300-012 111 434-300-013 112 434-300-016 113 434-300-017 13.A.7.dPacket Pg. 71Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) B-1 EXHIBIT “B” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 2) DESCRIPTION OF PROPERTY Real property in the City of San Jacinto, County of Riverside, State of California, described as follows: Assessor’s Parcel No. Improvement Area No. 2: 434-271-026 434-250-002 434-230-004 434-230-003 3.A.7.d Packet Pg. 72 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) C-1 EXHIBIT “C” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT CITY FEE FACILITIES 1. City Fee Facilities. The type of City Fee Facilities eligible to be financed by the CFD under the Act consist of the construction, acquisition, modification, expansion, maintenance and/or rehabilitation of capital improvements authorized to be financed with City of San Jacinto (the “City”) development impact fees (“DIF”) (which does not include any impact fees passed through to a Riverside County agency (e.g., Western Riverside Council of Governments Transportation Uniform Mitigation Fee)), including, but not limited to, interchange improvements, streets and street improvements, traffic signalizations, storm drains, flood control, sewer, water capital improvements, trails, fire facilities, police facilities, public safety, parkland facilities, park facilities, recreation center facilities, open space facilities, library facilities, City Hall facilities, corporate yard facilities, maintenance facilities, animal shelter facilities, government services, community amenities, and all appurtenances and appurtenant work in connection with the foregoing, including the cost of engineering, planning, designing, materials testing, coordination, construction staking, construction management and supervision for such City Fee Facilities, and any other expense incidental to the construction, acquisition, modification, expansion or rehabilitation of such City Fee Facilities, all as permitted under the provisions of the Mello-Roos Community Facilities Act of 1982, as amended. The amount of the City Fee Facilities will be based on the applicable fee schedule, which is subject to change. 3.A.7.d Packet Pg. 73 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) D-1 Sequence No. _____ City SA# _____ EXHIBIT “D” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT DISBURSEMENT REQUEST FORM 1. Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is hereby requested to pay from Bond Proceeds relating to Improvement Area No. 2 to the City of San Jacinto (the “City”), as Payee, or to the City’s designee, the sum set forth in 3 below. 2. The undersigned certifies that the amount requested for City Fee Facilities is due and payable, has not formed the basis of prior request or payment, and is being made with respect to the Joint Community Facilities Agreement by and among San Jacinto Unified School District, City of San Jacinto, and D.R. Horton Los Angeles Holding Company, Inc., a California corporation, dated April 1, 2022 (the “JCFA”). 3. Amount requested: $________________ For Tract / Lot Nos: ______________ within Improvement Area No. 2 4. The amount set forth in 3 above is authorized and payable pursuant to the terms of the JCFA. Capitalized terms not defined herein shall have the meaning set forth in the JCFA. The City shall spend the Bond Proceeds allocated hereby in accordance with the requirements set forth in Section 5 of the JCFA. By entering into the JCFA and requisitioning Bond Proceeds as described herein, the City is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California state income tax purposes. PROPERTY OWNER D.R. HORTON LOS ANGELES HOLDING COMPANY, INC., a California corporation By: ____[Form; do not sign]____________ Barbara M. Scull, Vice President CITY OF SAN JACINTO By: [Form, do not sign] Name: Title: ATTEST: By: [Form, do not sign] Clerk of the City cc: City Finance Dept. 3.A.7.d Packet Pg. 74 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) E-1 EXHIBIT “E” FORM OF CITY CERTIFICATION COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 2) 20__ SPECIAL TAX BONDS (IMPROVEMENT AREA NO. 2) CERTIFICATE OF THE CITY OF SAN JACINTO WHEREAS, Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is issuing the above-captioned bonds (the “Bonds”) for the purpose of financing certain infrastructure capital improvements, including the capital expenditures of facilities owned by the City of San Jacinto (the “City”); WHEREAS, the CFD will make available to the City $__________ of Bond proceeds (the “Proceeds”); WHEREAS, the City has read and understands the restrictions of the Tax Certificate (the “Tax Certificate”) of the CFD, dated __________, 20__, with respect to the Bonds; NOW, THEREFORE, the City covenants the following: 1. The City will expend the Proceeds on capital costs (the “Costs”) paid to third parties for City improvements or equipment (the “City Project”). 2. The City will maintain records regarding the investment and expenditure of the Proceeds and the usage of the City Project. 3. The City will cooperate with the CFD regarding compliance with the terms of the Tax Certificate, including remitting any rebatable arbitrage on the Proceeds, if any, to the CFD to comply with the restrictions of Section 148(f) of the Code. 4. None of the City will be subject to Private Use (as defined in the Tax Certificate) absent consent of the CFD. All terms not defined herein have the meaning ascribed in the attached Tax Certificate. Dated: _________, 20__ CITY OF SAN JACINTO By: [Form, do not sign] [Name] [Title] 3.A.7.d Packet Pg. 75 Attachment: Exhibit D - Joint Community Facilities Agreement IA 2 (JCFA Approval - Starling Point) JOINT COMMUNITY FACILITIES AGREEMENT relating to Community Facilities District No. 2022-1 of the San Jacinto Unified School District Improvement Area No. 3 by and among San Jacinto Unified School District, City of San Jacinto and GENUS, L.P., A CALIFORNIA LIMITED PARTNERSHIP THIS JOINT COMMUNITY FACILITIES AGREEMENT (the “Agreement”) is entered into effective as of the 1st day of April, 2022, by and among SAN JACINTO UNIFIED SCHOOL DISTRICT, a California unified school district (“School District”), the CITY OF SAN JACINTO, a California general law city (the “City”) and Genus, L.P., a California limited partnership (“Property Owner”). This Agreement relates to the formation by the School District of a community facilities district known as “Community Facilities District No. 2022-1 of the San Jacinto Unified School District” (the “CFD”), and the establishment of Improvement Area No. 3 therein (“Improvement Area No. 3”) for the purpose of financing certain facilities to be constructed, owned, operated, or maintained by the School District, the City and Eastern Municipal Water District as a consequence of the development within the CFD to be used by the City to construct facilities to be owned and operated by the City from the proceeds of bonds issued by the CFD with respect to Improvement Area No. 3 and the proceeds of special taxes levied by the CFD with respect to Improvement Area No. 3. The CFD will also establish other improvement areas therein known as Improvement Area No. 1 (“Improvement Area No. 1”) and Improvement Area No. 2 (“Improvement Area No. 2”) (each an “Improvement Area” and together the “Improvement Areas”). R E C I T A L S: A.The property is depicted in Exhibit “A” and described in Exhibit “B” hereto (the “Property”), which is located in the City of San Jacinto, County of Riverside, State of California, and constitutes the land within the boundaries of proposed Improvement Area No. 3, proposed Improvement Area No. 1, and proposed Improvement Area No. 2 of the CFD. B.As of April 1, 2022, Property Owner owns the Property and intends to develop the Property for residential purposes consisting of Improvement Area No. 3 (78 single family residential units in Tract No. 33862). C.Property Owner petitioned the School District to form the CFD and the applicable Improvement Area for the purpose of financing, among other things, the construction of various public facilities to be owned and operated by the City as described in Exhibit “C” hereto, which facilities will benefit the Property in whole or in part, including certain public facilities to be constructed, owned and operated by the City (the “City Fee Facilities”) in lieu of the payment of City Fees (defined below). D.Property Owner has yet to determine whether it will finance any or all of the City Fee Facilities, in lieu of payment of City Fees, with Bond Proceeds (defined below) that are available for such purpose. The Parties (defined below) hereto acknowledge that the purpose of this Agreement is to satisfy the requirements of the Act (defined below). 3.A.7.e Packet Pg. 76 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 2 E. In conjunction with the issuance of building permits for the construction of homes within Improvement Area No. 3, the Property Owner, or its successors or assigns, may elect to advance City Fee Facilities costs in lieu of payment of City Fees (the “Advance(s)”) at such times as Bond Proceeds are not available in sufficient amounts to pay for City Fee Facilities. In such case, the Property Owner shall be entitled to (i) reimbursement of such Advances limited to Bond Proceeds available to the City, if any (the Advances being considered an interest free loan by the Property Owner with no repayment obligation except to the extent there are Bond Proceeds received by or made available to the City as described herein, all as further described in Section 5(a) below) and (ii) credit for payments made to the City from Bond Proceeds against City Fees which would otherwise be due to the City with respect to the Property for which such transfer was made equal to the amount of Bond Proceeds disbursed to the City or at the direction of the City for City Fee Facilities, all as further described herein. F. In addition to the City Fee Facilities, certain facilities to be owned and operated by the School District (the “School Facilities”) and certain facilities to be owned and operated by Eastern Municipal Water District (“EMWD”) are also expected to be funded from Bond Proceeds. G. The School District has sole discretion and responsibility for the formation and administration of the CFD. H. The School District is authorized by Section 53313.5 of the Act to assist in the financing of the acquisition and/or construction of the City Fee Facilities. This Agreement constitutes a joint community facilities agreement, within the meaning of Section 53316.2 of the Act, by and among the City, the Property Owner, and the School District, pursuant to which the CFD, when and if the CFD and Improvement Area No. 3 are formed, will be authorized to finance the acquisition and/or construction of all or a portion of the City Fee Facilities. As authorized by Section 53316.6 of the Act, responsibility for constructing, providing for, and operating the City Fee Facilities is delegated to the City. I. The Parties (defined below) hereto find and determine that the residents residing within the boundaries of the City, the School District, and Improvement Area No. 3 of the CFD will be benefited by the construction and/or acquisition of the School Facilities and City Fee Facilities and that this Agreement is beneficial to the interests of such residents. AGREEMENT NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the Parties hereto agree as follows: 1.Recitals. Each of the above recitals is incorporated herein and is true and correct. 2.Definitions. Unless the context clearly otherwise requires, the terms defined in this Section shall, for all purposes of this Agreement, have the meanings herein specified. (a)“Act” means the Mello-Roos Community Facilities Act of 1982, as amended, Chapter 2.5 (commencing with Section 53311) of Part 1 of Division 2 of Title 5 of the California Government Code. (b) “Advance” or “Advances” means an amount advanced by Property Owner to the City for City Fee Facilities in lieu of payment of City Fees prior to the availability of sufficient Bond Proceeds. Advances shall be deemed payment of City Fees to the extent sufficient Bond Proceeds are not received by or made available to the City. 3.A.7.e Packet Pg. 77 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 3 (c) “Bond Proceeds” or “Proceeds of the Bonds” shall mean those net funds generated by the sale of the Bonds and investment earnings thereon, net of costs of issuance, reserve fund, capitalized interest and administrative expenses and may include net funds generated by the levy of Special Taxes and investment earnings thereon. (d) “Bond Resolution” means that resolution, resolution supplement, fiscal agent agreement, indenture of trust or other equivalent document(s) providing for the issuance of the Bonds. (e) “Bonds” shall mean those bonds, or other securities, issued by, or on behalf of, the CFD in one or more series, as authorized by the qualified electors within Improvement Area No. 3 of which the estimated aggregate amount is not to exceed $4,500,000. (f) “City Fee Facilities” means those City capital improvements eligible to be financed with City Fees. (g) “City Fees” means fees for those capital improvements authorized to be financed with City development impact fees (“DIF”) and all components thereof, imposed by the City as a consequence of development of any portion of the Property to finance City Fee Facilities as further described in Exhibit “C” hereto. For the purposes of this Agreement, DIF is limited to those categories described in Exhibit “C” hereto. City Fee Facilities financed with Bond Proceeds pursuant to this Agreement may include City capital improvements from a single DIF category or multiple DIF categories at the discretion of the City. (h) “Disbursement Request” means a request for payment relating to City Fee Facilities in the form attached hereto as Exhibit “D.” (i) “Improvement Area No. 3” means the area designated as Improvement Area No. 3 on the boundary map of the CFD. (j) “Other Facilities Account of the Improvement Fund” means the fund, account, or sub-account of the CFD (regardless of its designation within the Bond Resolution) into which a portion of the Bond Proceeds may be deposited in accordance with the Bond Resolution to finance City Fee Facilities and which may have subaccounts. (k) “Party” or “Parties” shall mean any or all of the parties to this Agreement. (l) “Rate and Method” means the Rate and Method of Apportionment of the Special Tax authorizing the levy and collection of Special Taxes within Improvement Area No. 3 pursuant to proceedings undertaken for the formation of the CFD and Improvement Area No. 3 pursuant to the Act. (m) “School Facilities” means those public improvements to be owned, operated, or maintained by the School District identified in proceedings to form the CFD that are eligible to be financed with Bond Proceeds. (n) “Special Taxes” means the special taxes authorized to be levied and collected within Improvement Area No. 3 of the CFD pursuant to the Rate and Method. (o) “State” means the State of California. 3.A.7.e Packet Pg. 78 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 4 3. Formation of the CFD and Improvement Area No. 3. The School District has undertaken to analyze the appropriateness of forming the CFD and Improvement Area No. 3 to finance the City Fee Facilities, and other facilities. The School District has and will retain, at the expense of Property Owner, the necessary consultants to analyze the formation of the CFD. 4. Sale of Bonds and Use of Bond Proceeds. In the event that the CFD is formed and Bonds are issued, the Board of Education of the School District (the “Board”), acting as the legislative body of the CFD, may, in its sole discretion, finance City Fee Facilities by issuing one or more series of Bonds. Prior to the issuance of a series of Bonds that finance City Fee Facilities, the School District shall notify the City of such issuance. If at the time of such notification the City determines that it is unable to comply with tax-exempt requirements for use of the proceeds of the Bonds, the School District shall coordinate with the City as to the portion, if any, of the Bonds to be issued on a taxable basis to finance the City Fee Facilities. To the extent that the CFD and Property Owner determine that Bond Proceeds are available to finance City Fee Facilities, the School District shall notify the City of the amount of such Bond Proceeds deposited in the Other Facilities Account of the Improvement Fund that is available to finance City Fee Facilities. There is no assurance that City Fees will not increase in the future and available Bond Proceeds may be less than anticipated such that Bond Proceeds are not sufficient to fund the anticipated amount of City Fee Facilities in an amount equal to the aggregate total of the applicable City Fees. As Bond Proceeds are transferred to the City and reserved to fund City Fee Facilities as described in Section 5 below, the portion of the Property with respect to which such transfer was made shall receive a credit in the amount transferred against the payment of City Fees with respect to the Property. Nothing herein shall supersede the obligation of an owner of the Property to make Advances or otherwise pay City Fees to the City when due. The purpose of this Agreement is to provide a mechanism by which the CFD may issue the Bonds and levy Special Taxes to provide a source of funds to finance all or a portion of the City Fee Facilities in lieu of the payment of all or a portion of the City Fees. In the event that Bond Proceeds, including investment earnings thereon, are not available or sufficient to fully satisfy the obligation, then Property Owner shall remain obligated to make Advances for which it will receive no reimbursement (except to the extent Bond Proceeds later become available to the City) or pay City Fees to the City as required by the City in accordance with applicable law. The Bonds shall be issued only if, in its sole discretion, the Board determines that all requirements of State and federal law and all School District policies have been satisfied or have been waived by the School District. Nothing in this Agreement shall confer upon the City or any owner of the Property, including Property Owner, a right to compel the issuance of the Bonds or the disbursement of Bond Proceeds to fund City Fee Facilities except in accordance with the terms of this Agreement. 5. Disbursements for City Fee Facilities. (a) Upon the funding of the Other Facilities Account of the Improvement Fund with funds reserved to fund City Fee Facilities, the Property Owner shall notify the City of the amount of Bond Proceeds reserved to fund City Fee Facilities and the Property Owner and the City may execute and submit a Disbursement Request for payment to the School District or the CFD requesting disbursement of an amount equal to all or a portion of the Advances from the Other Facilities Account of the Improvement Fund to the extent that Bond Proceeds are available in the Other Facilities Account of the Improvement Fund for such purpose. Upon the City’s receipt of funds pursuant to such Disbursement Request, the Property Owner shall receive reimbursement of the Advances from the City. To facilitate the City’s bookkeeping, the City may direct in a Disbursement Request, that all or a portion of a payment be made directly to the Property Owner as reimbursement for Advances made by the Property Owner. In the event of a reimbursement to the Property Owner pursuant to the preceding sentence, the City shall account for an equivalent amount of Advances previously received from the Property Owner in accordance with Section 5(c) below. 3.A.7.e Packet Pg. 79 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 5 To the extent that the City expends all or a portion of an Advance pending the deposit of Bond Proceeds in the Other Facilities Account of the Improvement Fund, for purposes of Treasury Regulations regarding investment and expenditure of Bond Proceeds and State law provisions regarding financing of public capital facilities, the Advance shall be considered an interest free loan by the Property Owner, which the City only agrees to repay to the extent of the deposit, if any, of Bond Proceeds in the Other Facilities Account of the Improvement Fund and the City’s written direction as described below to pay all or a portion of such deposit to the Property Owner as repayment of an Advance. (b) From time to time following the funding of the Other Facilities Account of the Improvement Fund, Property Owner may notify the City in writing and the City and Property Owner may jointly request a disbursement from the Other Facilities Account of the Improvement Fund to fund City Fee Facilities by executing and submitting a Disbursement Request. Upon receipt of such Disbursement Request completed in accordance with the terms of this Agreement, the CFD shall wire transfer or otherwise pay to the City (or upon the City’s written direction pay to the Property Owner or a City contractor) such requested funds to the extent that Bond Proceeds are then available, or subsequently become available, in the Other Facilities Account of the Improvement Fund for such purpose. Upon such notice and the City’s receipt of such disbursement (or upon payment to the Property Owner or a City contractor in accordance with directions from the City relating to City Fee Facilities), the Property Owner shall be deemed to have satisfied the portion of the applicable City Fees with respect to the number of dwelling units or lots for which City Fees would otherwise have been required in an amount equal to such disbursement divided by the per lot or unit amount of the applicable City Fees. (c) The City agrees that prior to submitting a Disbursement Request requesting payment from the CFD it shall review and approve all costs included in its request and will have already paid contractually or incurred such costs of City Fee Facilities from its own funds (which may include Advances from the Property Owner) subsequent to the date of this Agreement, or will disburse such amounts to pay the costs of the City Fee Facilities following receipt of funds from the CFD. If the City’s portion of the Bonds are issued on a tax-exempt basis, in the event that (i) the City does not have costs of the City Fee Facilities it has already paid or incurred which it can allocate such Bond Proceeds to or (ii) within five banking days of receipt, the City does not disburse any Bond Proceeds (or equivalent amount of Advances repaid pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) received by it to third parties, it will trace and report to the CFD all earnings, if any, earned by the City, from the date of receipt of such Bond Proceeds by the City (or the date of disbursement pursuant to the second to the last sentence of the first paragraph of Section 5(a) above) to the date of expenditure by the City for capital costs of the City Fee Facilities. Such report shall be delivered at least semi-annually until all Bond Proceeds are expended by the City. If the City’s portion of the Bonds are issued on a tax-exempt basis, the City agrees that in processing the above disbursements it will comply with all legal requirements for the expenditure of Bond Proceeds under the Internal Revenue Code of 1986 and any amendments thereto. (d) Subject to Section 5(e) below, the City agrees to maintain adequate internal controls over its payment function and to maintain accounting records in accordance with generally accepted accounting procedures. The City will, upon request, provide the School District and/or Property Owner with access to the City’s records related to the City Fee Facilities and expenditure of Advances and will provide to the School District its annual financial report certified by an independent certified public accountant for purposes of assisting the School District in calculating the arbitrage rebate obligation of the CFD, if any. (e) At the City’s discretion, the City may elect to satisfy the tracing and accounting of Bond Proceeds requirements set forth in this Section 5 of this Agreement by selecting and depositing unexpended Bond Proceeds with a commercial bank, savings bank, savings and loan association, or other financial institution, which is authorized by law to accept, hold, trace, and account for deposits of money (the 3.A.7.e Packet Pg. 80 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 6 “Deposit Institution”). Property Owner shall pay for all costs and expenses associated with such Deposit Institution and shall pay said costs and expenses as provided in the written direction of the City. (f) The School District or the CFD agrees to maintain full and accurate records of all amounts, and investment earnings, if any, expended from the Other Facilities Account of the Improvement Fund and expenditure of Advances. The School District or the CFD will, upon request, provide the City and/or Property Owner with access to the School District’s or the CFD’s records related to the Other Facilities Account of the Improvement Fund. (g) As a condition to receiving Bond Proceeds, the City agrees that it shall provide to the School District a certificate substantially in the form attached hereto as Exhibit “E.” 6. Ownership of City Fee Facilities; Payment of Administrative Fees. The City Fee Facilities, once acquired, shall be and remain the property of the City. 7. Indemnification. (a) Indemnification by the School District. The School District shall assume the defense of, indemnify and save harmless, the City and its respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the School District with respect to this Agreement and the issuance of the Bonds; provided, however, that the School District shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. (b) Indemnification by Property Owner. Property Owner shall assume the defense of, indemnify and save harmless, the School District, the CFD, and the City, their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of Property Owner with respect to this Agreement; including any actions, damages, claims, losses, or expenses relating to compliance with the Improvement and Credit Agreement and the Transportation Uniform Mitigation Fee (“TUMF”) Program Administrative Plan adopted by Western Riverside Council of Governments; provided, however, that Property Owner shall not be required to indemnify any person or entity as to damages resulting from the negligence or willful misconduct of such person or entity or their officers, agents, or employees. (c) Indemnification by the City. The City shall assume the defense of, indemnify and save harmless, the School District, the CFD and their respective officers, employees, and agents, and each and every one of them, from and against all actions, damages, claims, losses, or expenses of every type and description to which they may be subjected or put, by reason of, or resulting from, any act or omission of the City with respect to this Agreement, and the design, engineering, and construction of the City Fee Facilities constructed by the City; provided, however, that the City shall not be required to indemnify any person or entity as to damages resulting from negligence or willful misconduct of such person or entity or their officers, agents, or employees. 8. Allocation of Special Taxes. The Board, as the legislative body of the CFD, shall annually levy the Special Taxes as provided for in the formation proceedings of the CFD. The entire amount of any Special Taxes levied by the CFD to repay Bonds, or to fund other obligations, shall be allocated to the CFD. 3.A.7.e Packet Pg. 81 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 7 9. Amendment and Assignment. This Agreement may be amended at any time but only in writing signed by each Party hereto. This Agreement may be assigned, in whole or in part, by Property Owner to the purchaser of any parcel of land within the Property, provided, however, such assignment shall not be effective unless and until the City and the School District have been notified, in writing, of such assignment and the assignment specifies whether the Property Owner or such assignee is authorized to execute disbursement requests and whether the Property Owner or such assignee is to be reimbursed for Advances which have not been reimbursed at the time of such notice. 10. Entire Agreement. This Agreement contains the entire 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. 11. Notices. Any notice, statement, demand, consent, approval, authorization, offer, designation, request or other communication required or permitted by this Agreement to be given or delivered hereunder to any other Party shall be in writing and deemed to have been received (a) if personally served or delivered, upon delivery, (b) if given by electronic communication, whether by telex, telegram, telecopier, or email upon the sender’s receipt of an appropriate answer back or other written acknowledgement from the addressee of successful transmission, (c) if given by registered or certified mail, return receipt requested, deposited with the United States mail postage prepaid, 72 hours after such notice is deposited with the United States mail, (d) if given by Federal Express or other overnight courier, with courier charges prepaid, 24 hours after delivery to said overnight courier, or (e) if given by any other means, upon the sender’s receipt of written acknowledgement from the addressee, addressed as follows: School District: San Jacinto Unified School District 2045 S. San Jacinto Ave. San Jacinto, CA 92583 Attn: Assistant Superintendent, Business Services Email: sheeren@sanjacinto.k12.ca.us With a copy to: James F. Anderson Law Firm, A Professional Corporation Attn: James F. Anderson, Bond Counsel 24001 Calle Magdalena, #3348 Laguna Hills, CA 92654 Email: jim.anderson@jfandersonlaw.com City: City of San Jacinto 595 S. San Jacinto Avenue San Jacinto, CA 92583 Attn: City Manager Email: Citymanager@sanjacintoca.gov With a copy to: Best Best & Krieger LLP 300 S. Grand Ave. Los Angeles, CA 90071 Attn: Michael Maurer 3.A.7.e Packet Pg. 82 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 8 Property Owner: Genus, L.P., c/o Devcal Corporation 2006 Old Highway 395 Fallbrook, CA 92028 Attention: Eugene Gabrych Email: ggabrych@gmail.com With a copy to: Michael Buck 555 Capitol Mall, Suite 570 Sacramento, CA 95814-4502 Email: mpaservices.mike@gmail.com Each Party may change its address for delivery of notice by delivering written notice of such change of address to the other Parties hereto. 12. Exhibits. All exhibits attached hereto are incorporated into this Agreement by reference. 13. Attorneys’ Fees. In the event of the bringing of any action or suit by any Party against any other Party arising out of this Agreement, the Party in whose favor final judgment shall be entered shall be entitled to recover from the losing Party all costs and expenses of suit, including reasonable attorneys’ fees. 14. Interpretation in the Event of Ambiguities or Disputes. The Parties acknowledge and agree that each has been given the opportunity to review this Agreement with legal counsel independently, and/or has the requisite experience and sophistication to understand, interpret, and agree to the particular language of the provisions hereof. In the event of an ambiguity in or dispute regarding the interpretation of same, the interpretation of this Agreement shall not be resolved by any rule of interpretation providing for interpretation against the Party who causes the uncertainty to exist or against the drafter. 15. 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. 16. Governing Law; Venue. This Agreement and any dispute arising hereunder shall be governed by and interpreted in accordance with the laws of the State of California. Venue of any action brought hereunder will be in the Superior Court of the State within Riverside County, California, and the Parties consent to the exercise of personal jurisdiction over them by any such courts for purposes of any such action or proceeding. The Parties expressly waive any right to transfer venue, including, but not limited to, any right to transfer venue pursuant to California Civil Code Section 394. 17. Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by any other Party hereto, or the failure by a Party to exercise its rights upon the default of any other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by such other Party with the terms of this Agreement thereafter. 18. No Third Party Beneficiaries. No person or entity other than the CFD, when and if formed, 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 School District, the CFD, and Property Owner (and their respective successors and assigns, exclusive of individual homebuyers), any rights, remedies, obligations, or liabilities under or by reason of this Agreement. 3.A.7.e Packet Pg. 83 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) 9 19. Singular and Plural; Gender. As used herein, the singular of any word includes the plural, and terms in the masculine gender shall include the feminine. 20. 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. 21. Termination. This Agreement shall terminate upon the earliest occurrence of the following events: (a) the dissolution pursuant to Section 53338.5 of the Act of the CFD; or (b) the written agreement of the City, the School District, and the Property Owner to terminate this Agreement. Notwithstanding the foregoing, this Agreement shall remain in full force and effect for as long as any Bonds are outstanding. 22. Captions. Captions to sections of this Agreement are for convenience purposes only and are not part of this Agreement 3.A.7.e Packet Pg. 84 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) S-1 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year written above. SAN JACINTO UNIFIED SCHOOL DISTRICT ____________________________ Assistant Superintendent, Business Services CITY OF SAN JACINTO By: City Manager ATTEST: By: ____________________________ City Clerk APPROVED AS TO FORM: By: ____________________________ City Attorney GENUS, L.P., a California limited partnership By: Devcal Corporation, a California corporation, its General Partner By: _______________________________ Eugene Gabrych, Partner 3.A.7.e Packet Pg. 85 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) A-1 EXHIBIT “A” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 3) BOUNDARY MAP; DEPICTION OF PROPERTY 3.A.7.e Packet Pg. 86 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1OF THE SAN JACINTO UNIFIED SCHOOL DISTRICTOF THE SAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY OF RIVERSIDESTATE OF CALIFORNIAFILED IN THE OFFICE OF THE CLERK OF THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, THIS _____ DAY OF _____________, 202__.__________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTI HEREBY CERTIFY THAT THE WITHIN MAP SHOWING THE PROPOSED BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT, COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, WAS APPROVED BY THE BOARD OF TRUSTEES OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT AT A REGULAR MEETING THEREOF, HELD ON THE ________ DAY OF ______________, 202__, BY ITS RESOLUTION NO. ____________________. __________________________________CLERK OF THE BOARD OF TRUSTEES OF THESAN JACINTO UNIFIED SCHOOL DISTRICTCOUNTY RECORDER'S CERTIFICATE:FILED THIS ______ DAY OF _________________, 202__, AT THE HOUR OF ______ O'CLOCK ____ .M., IN BOOK _________, OF MAPS OF ASSESSMENT AND COMMUNITY FACILITIES DISTRICTS AT PAGES _______, AS INSTRUMENT NO. _______________________________, IN THE OFFICE OF THE COUNTY RECORDER OF THE COUNTY OF RIVERSIDE, STATE OF CALIFORNIA, AT THE REQUEST OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT.__________________________________PETER ALDANA, ASSESSOR - COUNTY CLERK - RECORDERCOUNTY OF RIVERSIDEBY DEPUTYTHE LINES AND DIMENSIONS OF EACH LOT OR PARCEL SHOWN ON THIS MAP SHALL BE THOSE LINES AND DIMENSIONS AS SHOWN ON THE RIVERSIDE COUNTY ASSESSOR'S MAPS FOR THOSE PARCELS LISTED.THE RIVERSIDE COUNTY ASSESSOR'S MAPS SHALL GOVERN FOR ALL DETAILS CONCERNING THE LINES AND DIMENSIONS OF SUCH LOTS OR PARCELS..MAIN STRAMO N A E X P Y ALESSANDRO AVESAN JACINTO AVESITEVICINITY MAPN VERNON AVESHEET 1 OF 1LegendPROPOSED DISTRICT BOUNDARIES OF COMMUNITY FACILITIES DISTRICT NO. 2021-1IMPROVEMENT AREA NO. 1IMPROVEMENT AREA NO. 2IMPROVEMENT AREA NO. 3REMAINDER - NOT A PART123456789101112N CAMINO LOS BANOS ALESSANDRO AVEBURT STRAMONA EXPRESSWAY13MAP REFERENCE NUMBERASSESSOR'S PARCEL NUMBERIMPROVEMENT AREA1 433-070-051 32 433-110-020 33 433-110-040 34 434-190-007 35 434-190-008 36 434-230-003 27 434-230-004 28 434-250-002 29 434-271-026 210 434-300-012 111 434-300-013 112 434-300-016 113 434-300-017 13.A.7.ePacket Pg. 87Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) B-1 EXHIBIT “B” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 3) DESCRIPTION OF PROPERTY Real property in the City of San Jacinto, County of Riverside, State of California, described as follows: Assessor’s Parcel No. Improvement Area No. 3: 434-190-007 433-070-051 433-110-040 433-110-020 434-190-008 3.A.7.e Packet Pg. 88 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) C-1 EXHIBIT “C” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT CITY FEE FACILITIES 1. City Fee Facilities. The type of City Fee Facilities eligible to be financed by the CFD under the Act consist of the construction, acquisition, modification, expansion, maintenance and/or rehabilitation of capital improvements authorized to be financed with City of San Jacinto (the “City”) development impact fees (“DIF”) (which does not include any impact fees passed through to a Riverside County agency (e.g., Western Riverside Council of Governments Transportation Uniform Mitigation Fee)), including, but not limited to, interchange improvements, streets and street improvements, traffic signalizations, storm drains, flood control, sewer, water capital improvements, trails, fire facilities, police facilities, public safety, parkland facilities, park facilities, recreation center facilities, open space facilities, library facilities, City Hall facilities, corporate yard facilities, maintenance facilities, animal shelter facilities, government services, community amenities, and all appurtenances and appurtenant work in connection with the foregoing, including the cost of engineering, planning, designing, materials testing, coordination, construction staking, construction management and supervision for such City Fee Facilities, and any other expense incidental to the construction, acquisition, modification, expansion or rehabilitation of such City Fee Facilities, all as permitted under the provisions of the Mello-Roos Community Facilities Act of 1982, as amended. The amount of the City Fee Facilities will be based on the applicable fee schedule, which is subject to change. 3.A.7.e Packet Pg. 89 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) D-1 Sequence No. _____ City SA# _____ EXHIBIT “D” COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT DISBURSEMENT REQUEST FORM 1. Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is hereby requested to pay from Bond Proceeds relating to Improvement Area No. 3 to the City of San Jacinto (the “City”), as Payee, or to the City’s designee, the sum set forth in 3 below. 2. The undersigned certifies that the amount requested for City Fee Facilities is due and payable, has not formed the basis of prior request or payment, and is being made with respect to the Joint Community Facilities Agreement by and among San Jacinto Unified School District, City of San Jacinto, and Genus, L.P., a California limited partnership dated April 1, 2022 (the “JCFA”). 3. Amount requested: $________________ For Tract / Lot Nos: ______________ within Improvement Area No. 3 4. The amount set forth in 3 above is authorized and payable pursuant to the terms of the JCFA. Capitalized terms not defined herein shall have the meaning set forth in the JCFA. The City shall spend the Bond Proceeds allocated hereby in accordance with the requirements set forth in Section 5 of the JCFA. By entering into the JCFA and requisitioning Bond Proceeds as described herein, the City is not passing upon, determining or assuming the tax-exempt status of the Bonds for federal or California state income tax purposes. PROPERTY OWNER GENUS, L.P., a California limited partnership By: Devcal Corporation, a California corporation, its General Partner By: _______[Form; do not sign]_____________ Eugene Gabrych Partner 3.A.7.e Packet Pg. 90 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) D-2 CITY OF SAN JACINTO By: [Form, do not sign] Name: Title: ATTEST: By: [Form, do not sign] Clerk of the City cc: City Finance Dept. 3.A.7.e Packet Pg. 91 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) E-1 EXHIBIT “E” FORM OF CITY CERTIFICATION COMMUNITY FACILITIES DISTRICT NO. 2022-1 OF THE SAN JACINTO UNIFIED SCHOOL DISTRICT (IMPROVEMENT AREA NO. 3) 20__ SPECIAL TAX BONDS (IMPROVEMENT AREA NO. 3) CERTIFICATE OF THE CITY OF SAN JACINTO WHEREAS, Community Facilities District No. 2022-1 of the San Jacinto Unified School District (the “CFD”) is issuing the above-captioned bonds (the “Bonds”) for the purpose of financing certain infrastructure capital improvements, including the capital expenditures of facilities owned by the City of San Jacinto (the “City”); WHEREAS, the CFD will make available to the City $__________ of Bond proceeds (the “Proceeds”); WHEREAS, the City has read and understands the restrictions of the Tax Certificate (the “Tax Certificate”) of the CFD, dated __________, 20__, with respect to the Bonds; NOW, THEREFORE, the City covenants the following: 1. The City will expend the Proceeds on capital costs (the “Costs”) paid to third parties for City improvements or equipment (the “City Project”). 2. The City will maintain records regarding the investment and expenditure of the Proceeds and the usage of the City Project. 3. The City will cooperate with the CFD regarding compliance with the terms of the Tax Certificate, including remitting any rebatable arbitrage on the Proceeds, if any, to the CFD to comply with the restrictions of Section 148(f) of the Code. 4. None of the City will be subject to Private Use (as defined in the Tax Certificate) absent consent of the CFD. All terms not defined herein have the meaning ascribed in the attached Tax Certificate. Dated: _________, 20__ CITY OF SAN JACINTO By: [Form, do not sign] [Name] [Title] 3.A.7.e Packet Pg. 92 Attachment: Exhibit E - Joint Community Facilities Agreement IA 3 (JCFA Approval - Starling Point) November 1, 2022 TO: City Council REQUESTED BY: Erika Gomez, Finance Director APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Statement of Investment Policy RECOMMENDATION: Staff recommends that the City Council approve the revised Statement of Investment Policy and adopt Resolution No. 3958. BACKGROUND: Section 53646 of the Government Code of the State of California requires the City to review its Statement of Investment Policy annually and make revisions if necessary. The City Council last reviewed and approved the policy on September 21, 2021, with no changes at that time. The Statement of Investment Policy is legally required and provides authority to invest in allowable securities and within specified durations as detailed within the guidelines of the adopted policy. The policy cannot be more liberal than that allowed by California Government Code §53600 et. seq.; however, it can be more restrictive. DISCUSSION: The primary objectives of the Statement of Investment policy are to ensure the following: Legality: Sections 53601 and 53635 of the Government Code outlines what investments are allowable for California agencies. Safety: It is the primary duty and responsibility of the Treasurer to protect, preserve and maintain cash and investments on behalf of the citizens of the City of San Jacinto. Generally, the higher the yield, the greater the risk an investment carries. Maturity: The longer an investment is held, the greater the degree of market risk (the risk that changes in the financial market will reduce the value of a security). Investment in instruments with varying maturities provides a natural hedge against changes in interest rates. Liquidity: To meet disbursement requirements, an adequate portion of the investment portfolio should be liquid and easily converted to cash, such as in an investment pool or money market. 3.A.8 Packet Pg. 93 Risk: The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, taking into account risk constraints. Yields should become a consideration only after the basic requirements of legality, safety, maturity, and liquidity have been met. FISCAL IMPACT: There are no recommended changes that would result in a fiscal impact. ATTACHMENTS: 11-01-22 Resolution - Statement of Investment Policy 3.A.8 Packet Pg. 94 STATE OF CALIFORNIA) RESOLUTION NO. 3958 COUNTY OF RIVERSIDE)ss CITY OF SAN JACINTO) A RESOLUTION OF THE CITY OF SAN JACINTO, CALIFORNIA, REVISING THE STATEMENT OF INVESTMENT POLICY WHEREAS, Section 53646 of the Government Code of the State of California requires that the Treasurer or Chief Fiscal Officer shall annually render to the legislative body of his/her agency for review and/or amendment, a Statement of Investment Policy; and WHEREAS, any changes to the City’s Statement of Investment must be considered in public session of legislative body; and WHEREAS, the City’s Statement of Investment Policy was last reviewed on September 21, 2021, with no changes; and WHEREAS, the City’s Statement of Investment Policy has not been significantly revised. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of San Jacinto hereby rescinds previous investment policy resolutions and approves the Statement of Investment Policy, as attached hereto in Exhibit “A”. APPROVED, PASSED and ADOPTED this 1st day of November 2022, by the following vote: Ayes: Nays: Abstain: Absent: City of San Jacinto _____________________ Crystal Ruiz, Mayor ATTEST: ___________________________ Julia Espinoza, City Clerk 3.A.8.a Packet Pg. 95 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) EXHIBIT “A” 3.A.8.a Packet Pg. 96 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) CITY OF SAN JACINTO STATEMENT OF INVESTMENT POLICY I. INTRODUCTION The City of San Jacinto’s (City) investment program will conform with federal, state, and other legal requirements, including California Government Code Sections 16429.1-16429.4, 53600- 53609 and 53630-53686. The following investment policy addresses the methods, procedures and practices, which must be exercised to ensure effective and judicious fiscal and investment management of the City’s funds. It is the policy of the City to invest public funds in a manner that will provide a market rate of return, given its requirements for preserving principal and meeting the daily cash flow demands of the City. All investments will comply with this Investment Policy and governing laws. This Investment Policy was endorsed and adopted by the City’s governing body (City Council) and is effective as of November 1, 2022. This Investment Policy replaces any previous Investment Policy of the City. II. PUBLIC TRUST All participants in the investment process shall act as custodians of the public trust. Investment officials shall recognize that the investment portfolio is subject to public review and evaluation. The overall program shall be designed and managed with a degree of professionalism that is worthy of the public trust. In a diversified portfolio, it must be recognized that occasional measurement losses are inevitable, and must be considered within the context of the overall portfolio’s investment return, provided that adequate diversification has been implemented. III. SCOPE This Investment Policy applies to all the City’s financial assets and investment activities with the following exceptions: A. Proceeds of debt issuance shall be invested in accordance with the City’s general investment philosophy as set forth in this policy; however, such proceeds are invested in accordance with permitted investment provisions of their specific bond indentures. Pooling of Funds: Except for cash in certain restricted and special funds, the City will consolidate cash and reserve balances from all funds to maximize investment earnings and to increase efficiencies with regard to investment pricing, safekeeping and administration. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles. IV. GENERAL OBJECTIVES 3.A.8.a Packet Pg. 97 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) The overriding objectives of the investment program are to preserve principal, provide sufficient liquidity, and manage investment risks. 1. Safety: It is the primary duty and responsibility of the City Treasurer to protect, preserve and maintain cash and investments placed in his/her trust on behalf of the citizens of the City. Safety of principal is the foremost objective of the investment program. Investments will be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. The objective will be to mitigate credit risk and interest rate risk. 2. Liquidity: The investment portfolio will remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated. Since all cash requirements cannot be anticipated, investments in securities shall be those with active secondary or resale markets. 3. Return: The investment portfolio will be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints for safety and liquidity needs. Yields should become a consideration only after the basic requirements of safety and liquidity have been met. V. PRUDENCE, INDEMNIFICATION AND ETHICS A. Prudent Investor Standard: Management of the City’s investments is governed by the Prudent Investor Standard as set forth in the California Government Code 53600.3: “…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.” In keeping with the objectives (Section IV), in addition to safeguarding the principle and maintaining the liquidity needs of the City, a prudent investor should also optimize return or yield to the greatest extent possible. B. Indemnification: The City Treasurer, Finance Director and other authorized persons responsible for managing City funds, acting in accordance with written procedures and the investment policy and exercising due diligence, will be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from 3.A.8.a Packet Pg. 98 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) expectations are reported within 30 days and appropriate action is taken to control adverse developments. C. Ethics: Officers and employees involved in the investment process are prohibited from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. VI. DELEGATION OF AUTHORITY A. Authority to manage the City’s investment program is derived from California Government Code Sections 53600 et seq. The City Council is responsible for the City’s cash management, including the administration of this Investment Policy. Management responsibility for the cash management of City funds is hereby delegated to the City Treasurer and the Finance Director. The City Treasurer and Finance Director will be responsible for all transactions undertaken and will establish a system of procedures and controls to regulate the activities of subordinate employees. B. The City may engage the services of one or more external investment managers to assist in the management of the City’s investment portfolio in a manner consistent with the City’s objectives. Such external managers may be granted discretion to purchase and sell investment securities in accordance with this Investment Policy. Such managers must be registered under the Investment Advisers Act of 1940. VII. AUTHORIZED FINANCIAL INSTITUTIONS, DEPOSITORIES, AND BROKER/DEALERS A list will be maintained of financial institutions and depositories authorized to provide investment services. In addition, a list will be maintained of approved security broker/dealers selected by conducting a process of due diligence. These may include "primary" dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15C3-1 (uniform net capital rule). A. The City Treasurer and Finance Director will determine which financial institutions are authorized to provide investment services to the City. Institutions eligible to transact investment business with the City include: 1. Primary government dealers as designated by the Federal Reserve Bank; 2. Nationally or state-chartered banks; 3. The Federal Reserve Bank; and, 4. Direct issuers of securities eligible for purchase. 3.A.8.a Packet Pg. 99 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) B. Selection of financial institutions and broker/dealers authorized to engage in transactions with the City will be at the sole discretion of the City. C. All financial institutions which desire to become qualified bidders for investment transactions (and which are not dealing only with the investment adviser) must supply the Finance Director with a statement certifying that the institution has reviewed the California Government Code Section 53600 et seq. and the City’s Investment Policy. D. Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the investment adviser, provided they meet all of the requirements as stated. E. Public deposits will be made only in qualified public depositories as established by State law. Deposits will be insured by the Federal Deposit Insurance Corporation (FDIC), or, to the extent the amount exceeds the insured maximum, will be collateralized in accordance with State law. Financial institutions that do not offer FDIC insurance will not be invested in. A written contract of deposit of public funds must be obtained from the financial institution, indicating the institution’s policy and process of FDIC insurance and collateralization. VIII. DELIVERY, SAFEKEEPING AND CUSTODY, AND COMPETITIVE TRANSACTIONS A. Delivery-versus-payment: Settlement of all investment transactions will be completed using standard delivery-vs.-payment procedures. B. Third-party safekeeping: To protect against potential losses by collapse of individual securities dealers, and to enhance access to securities, interest payments and maturity proceeds, all securities owned by the City will be held in safekeeping by a third party bank custodian, acting as agent for the City under the terms of a custody agreement executed by the bank and the City. C. Competitive transactions: All investment transactions will be conducted on a competitive basis which can be executed through a bidding process involving at least three separate brokers/financial institutions or through the use of a nationally recognized trading platform. IX. AUTHORIZED AND SUITABLE INVESTMENTS All investments will be made in accordance with Sections 53600 et seq. of the Government Code of California and as described within this Investment Policy. Percentage limitations and minimum credit ratings described in this section will be applicable at the time of purchase. Permitted investments under this policy will include: 1. MUNICIPAL SECURITIES include obligations of the City of San Jacinto, the State of California and any local agency within the State of California, provided that: 3.A.8.a Packet Pg. 100 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy)  The securities are rated in a rating category of “A” or its equivalent or better by at least one nationally recognized statistical rating organization (“NRSRO”).  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years. 2. MUNICIPAL SECURITIES (REGISTERED TREASURY NOTES OR BONDS) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.  The securities are rated in a rating category of “A” or its equivalent or better by at least one NRSRO.  No more than 5% of the portfolio may be invested in any single issuer.  No more than 30% of the portfolio may be in Municipal Securities.  The maximum maturity does not exceed five (5) years. 1. U.S. Treasury and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest. There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries. 2. Federal Agency or United States government-sponsored enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government -sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in government-sponsored enterprises. 3. Banker’s acceptances, provided that: a. They are issued by institutions with short term debt obligations rated ”A-1” or higher, or the equivalent, by at least two NRSROs; and have long-term debt obligations which are rated in the ”A” category or higher by at least two NRSROs; b. The maturity does not exceed 180 days; and, c. No more than 40% of the total portfolio may be invested in banker’s acceptances and no more than 5% per issuer. 4. Federally insured time deposits (Non-negotiable certificates of deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that: a. The amount per institution is limited to the maximum covered under federal insurance; and, 3.A.8.a Packet Pg. 101 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) b. No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits; and, c. The maturity of such deposits does not exceed 5 years. 5. Collateralized time deposits (Non-negotiable certificates of deposit) in state or federally chartered banks, savings and loans, or credit unions in excess of insured amounts which are fully collateralized with securities in accordance with California law, provided that: a. No more than 20% of the portfolio will be invested in a combination of federally insured and collateralized time deposits; b. They are issued by institutions which have long-term debt obligations which are rated in the ”A” category or higher by at least two NRSROs; and/or have short term obligations rated ”A-1” or higher, or the equivalent, by at least two NRSROs; and, c. The maturity of such deposits does not exceed 5 years. 6. Certificate of Deposit Placement Service (CDARS), provided that: a. No more than 30% of the total portfolio may be invested in a combination of certificates of deposit including CDARS; and, b. The maturity of CDARS deposits does not exceed five years. 7. Negotiable certificates of deposit (NCDs), issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federal licensed or state licensed branch of a foreign bank, provided that: a. They are issued by institutions which have long-term obligations which are rated in the ”A” category or higher by at least two NRSROs; and/or have short term debt obligations rated ”A-1” or higher, or the equivalent, by at least two NRSROs; b. The maturity does not exceed five years; and, c. No more than 30% of the total portfolio may be invested in NCDs and no more than 5% per issuer. 8. COLLATERALIZED BANK DEPOSITS. The City’s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651. There are no limits on the dollar amount or percentage that the Agency may invest in collateralized bank deposits. 3.A.8.a Packet Pg. 102 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) 9. Repurchase agreements collateralized with securities authorized under Sections VI and VIII(2 and 3) of this policy maintained at a level of at least 102% of the market value of the repurchase agreements, provided that: a. The maximum maturity of repurchase agreements will be 1 year; b. There is no limit to the amount to be invested in repurchase agreements; c. Securities used as collateral for repurchase agreements will be delivered to the City’s custodian bank (See Section VII B); and, d. The repurchase agreements are the subject of a master repurchase agreement between the City and the provider of the repurchase agreement. The master repurchase agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA). 10. Commercial paper, provided that: a. The maturity does not exceed 270 days from the date of purchase; b. The issuer is a corporation organized and operating in the United States with assets in excess of $500 million; c. They are issued by institutions whose short term obligations are rated ”A-1” or higher, or the equivalent, by at least two NRSROs; and whose long-term obligations are rated ”A” category or higher by at least two NRSROs; and, d. No more than 25% of the portfolio is invested in commercial paper and no more than 5% per issuer. 11. State of California Local Agency Investment Fund (LAIF), provided that: a. No more than 70% of the total portfolio may be invested in LAIF, up to the maximum permitted balance; and, b. LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude it from the City’s list of allowable investments, provided that the fund’s reports allow the City Treasurer and Finance Director to adequately judge the risk inherent in LAIF’s portfolio. 12. Local government investment pools and Joint Powers Authority Pools a. Riverside County Investment Fund, no more than 70% of the total portfolio; and, b. JPA Pools, no more than 50% of the total portfolio. 3.A.8.a Packet Pg. 103 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) 13. Corporate medium term notes (MTNs), provided that: a. Such notes have a maximum maturity of five years; b. Are issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States; c. Are rated ”A” category or better by at least two NRSROs; and, d. Holdings of medium-term notes may not exceed 30% of the portfolio and no more than 5% per issuer. 14. Mortgage pass-through, mortgage-backed, collateralized mortgage obligations, and asset-backed securities, provided that such securities: a. have a maximum stated final maturity of five years; b. be issued by an issuer having an “A” category or higher rating for the issuer’s debt as provided by at least two NRSROs; c. be rated in a rating category of “AA” category or its equivalent or better b y at least two NRSROs; and, d. Purchase of securities authorized by this subdivision may not exceed 20% of the portfolio. 17. MUTUAL FUNDS AND MONEY MARKET MUTUAL FUNDS that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that: e. MUTUAL FUNDS that invest in the securities and obligations as authorized under California Government Code, Section 53601 (a) to (k) and (m) to (q) inclusive and that meet either of the following criteria: 1. Attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or 2. Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations authorized by California Government Code, Section 53601 and with assets under management in excess of $500 million. 3. No more than 10% of the total portfolio may be invested in shares of any one mutual fund. 3.A.8.a Packet Pg. 104 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) b. MONEY MARKET MUTUAL FUNDS registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria: 1. Have attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or 2. Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience managing money market mutual funds with assets under management in excess of $500 million. 3. No more than 20% of the total portfolio may be invested in Money Market Mutual Funds. c. No more than 20% of the total portfolio may be invested in these securities. 18. SUPRANATIONALS, provided that:  Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.  The securities are rated in a rating category of “AA” or its equivalent or better by a NRSRO.  No more than 30% of the total portfolio may be invested in these securities.  No more than 10% of the portfolio may be invested in any single issuer.  The maximum maturity does not exceed five (5) years. X. PORTFOLIO RISK MANAGEMENT A. Prohibited investment vehicles and practices 1. State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options. 2. In accordance with Government Code Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited. 3. Investment in any security that could result in a zero interest accrual if held to maturity is prohibited. 4. Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited. 5. Purchasing or selling securities on margin is prohibited. 6. The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited. 3.A.8.a Packet Pg. 105 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) 7. The purchase of foreign currency denominated securities is prohibited. B. Mitigating credit risk in the portfolio Credit risk is the risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strat egies: 1. The diversification requirements included in Section VIII are designed to mitigate credit risk in the portfolio; 2. No more than 5% of the total portfolio may be invested in securities of any single issuer, other than the US Government, its agencies and enterprises, Money Market Mutual Funds, Mutual Funds, LAIF, LGIPs, Supranationals, or unless otherwise specified in this investment policy; 3. The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to improve the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences; and, 4. If securities owned by the City are downgraded by either Moody’s or S&P to a level below the quality required by this Investment Policy, it will be the City’s policy to review the credit situation and make a determination as to whether to sell or retain such securities in the portfolio. a. If a security is downgraded, the City Treasurer and Finance Director will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. b. If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the governing board. C. Mitigating market risk in the portfolio Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cashflow purposes. The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk: 3.A.8.a Packet Pg. 106 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) 1. The City will maintain a minimum of three months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements; 2. The maximum percent of callable securities (does not include “make whole call” securities as defined in the Glossary) in the portfolio will be 20%; 3. The maximum stated final maturity of individual securities in the portfolio will be five years, except as otherwise stated in this policy; and, 4. The duration of the portfolio will at all times be approximately equal to the duration (typically plus or minus 20%) of a Market Benchmark Index selected by the City based on the City’s investment objectives, constraints and risk tolerances. The City’s current Benchmark will be documented in the investment procedures manual. XI. INVESTMENT OBJECTIVES (PERFORMANCE STANDARDS AND EVALUATION) A. Overall objective: The investment portfolio will be designed with the overall objective of obtaining a total rate of return throughout economic cycles, commensurate with investment risk constraints and cash flow needs. B. Specific objective: The investment performance objective for the portfolio will be to earn a total rate of return over a market cycle which is approximately equal to the return on the Market Benchmark Index as described in the City’s investment procedures manual. The performance of the City’s investments shall be compared to the total return of a benchmark that closely corresponds to the portfolio’s duration, universe of allowable securities, risk profile, and other relevant characteristics. XII. PROCEDURES AND INTERNAL CONTROLS A. Procedures The City Treasurer and Finance Director will establish written investment policy procedures in a separate investment procedures manual to assist investment staff with day-to-day operations of the investment program consistent with this policy. Such procedures will include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the City Treasurer and Finance Director. B. Internal Controls The City Treasurer and Finance Director are responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse. The internal control structure will be designed to provide reasonable assurance that these objectives are met. Internal controls will be described in the City’s investment procedures manual. XIII. REPORTING, DISCLOSURE AND PROGRAM EVALUATION 3.A.8.a Packet Pg. 107 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) A. Monthly reports Monthly investment reports will be submitted by the City Treasurer to the City Council. These reports will disclose, at a minimum, the following information about the risk characteristics of the City’s portfolio: 1. An asset listing showing par value, cost and accurate and complete market value of each security, type of investment, issuer, and interest rate; 2. A one-page summary report that shows: a. Average maturity of the portfolio and modified duration of the portfolio; b. Maturity distribution of the portfolio; c. Average portfolio credit quality; and, d. Time-weighted total rate of return for the portfolio for the prior one month, three months, twelve months, year to date, and since inception compared to the Benchmark Index returns for the same periods; 3. A statement of compliance with investment policy, including a schedule of any transactions or holdings which do not comply with this policy or with the California Government Code, including a justification for their presence in the portfolio and a timetable for resolution; and, 4. A statement that the City has adequate funds to meet its cash flow requirements for the next six months. 5. A list of transactions for the period. B. Annual reports 1. The investment policy will be reviewed and adopted at least annually within 120 days of the end of the fiscal year to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. 2. A comprehensive annual report will be presented in conjunction with the investment policy review. This report will include comparisons of the City’s return to the Benchmark Index return, suggest policies and improvements that might enhance the investment program, and will include an investment plan for the coming year. C. Periodic audit The City Treasurer may establish a process of periodic independent review by an external expert to assure compliance with internal controls. Prepared by: 3.A.8.a Packet Pg. 108 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) Thomas Prill, Deputy City Manager Approved as to legal form: ___________________________________ Michael Maurer, City Attorney Approved: _____________________________________ Crystal Ruiz, Mayor Date: November 1, 2022 3.A.8.a Packet Pg. 109 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) Appendix I Authorized Personnel The following investments (as defined in Section IX) can only be made by joint approval of the City Treasurer and Finance Director. When an external investment adviser is retained, approval of a proposed portfolio structure by the City Treasurer and Finance Director will suffice. Municipal bonds (City, State, Agency) U.S. Treasury obligations Federal Agency obligations Banker’s acceptances Time deposits, federally insured or collateralized, including CDARS Negotiable certificates of deposit Repurchase agreements Commercial paper Corporate medium term notes Mortgage pass-through and asset-backed securities Mutual funds The following investments (as defined in Section IX) can be made by the Finance Director or his designee: Money market mutual funds (non-brokered) Local Agency Investment Fund (LAIF) County Pooled Investment Funds Joint Powers Authority Pool Bank deposits, federally insured or collateralized 3.A.8.a Packet Pg. 110 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) Appendix II GLOSSARY OF INVESTMENT TERMS© Agencies. Shorthand market terminology for any obligation issued by a government-sponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are: FDIC. The Federal Deposit Insurance Corporation provides insurance backed by the full faith and credit of the US government to certain bank deposits and debt obligations. FFCB. The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds. FHLB. The Federal Home Loan Bank provides credit and liquidity in the housing market. FHLB issues discount notes and bonds. FHLMC. Like FHLB, the Federal Home Loan Mortgage Corporation provides credit and liquidity in the housing market. FHLMC, also called “FreddieMac” issues discount notes, bonds and mortgage pass-through securities. FNMA. Like FHLB and FreddieMac, the Federal National Mortgage Association was established to provide credit and liquidity in the housing market. FNMA, also known as “FannieMae,” issues discount notes, bonds and mortgage pass-through securities. GNMA. The Government National Mortgage Association, known as “GinnieMae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government. PEFCO. The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government. TVA. The Tennessee Valley Authority provides flood control and power and promotes development in portions of the Tennessee, Ohio, and Mississippi River valleys. TVA currently issues discount notes and bonds. Asked. The price at which a seller offers to sell a security. ASSET BACKED SECURITIES. Securities supported by pools of installment loans or leases or by pools of revolving lines of credit. Average Life. In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected. Banker’s Acceptance. A money market instrument created to facilitate international trade transactions. It is highly liquid and safe because the risk of the trade transaction is transferred to the bank which “accepts” the obligation to pay the investor. Benchmark. A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy. Bid. The price at which a buyer offers to buy a security. Broker. A broker brings buyers and sellers together for a transaction for which the broker receives a commission. A broker does not sell securities from his own position. Callable. A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline since an issuer issues securities, it will likely call its current securities and reissue them at a lower rate of interest. Callable securities have reinvestment risk as the investor may receive its principal back when interest rates are lower than when the investment was initially made. 3.A.8.a Packet Pg. 111 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) Certificate of Deposit (CD). A time deposit with a specific maturity evidenced by a certificate. Large denomination CDs may be marketable. Collateral. Securities or cash pledged by a borrower to secure repayment of a loan or repurchase agreement. Also, securities pledged by a financial institution to secure deposits of public monies. Certificate of Deposit Account Registry System (CDARS). A private placement service that allows local agencies to purchase more than $250,000 in CDs from a single financial institution (must be a participating institution of CDARS) while still maintaining FDIC insurance coverage. CDARS facilitates the trading of deposits between the California institution and other participating institutions in amounts that are less than $250,000 each so that FDIC coverage is maintained. Collateralized Mortgage Obligations (CMO). Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities. COLLATERALIZED MORTGAGE OBLIGATIONS (CMO). Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities. Commercial Paper. The short-term unsecured debt of corporations. Cost Yield. The annual income from an investment divided by the purchase cost. Because it does not give effect to premiums and discounts which may have been included in the purchase cost, it is an incomplete measure of return. Coupon. The rate of return at which interest is paid on a bond. Credit Risk. The risk that principal and/or interest on an investment will not be paid in a timely manner due to changes in the condition of the issuer. Current Yield. The annual income from an investment divided by the current market value. Since the mathematical calculation relies on the current market value rather than the investor’s cost, current yield is unrelated to the actual return the investor will earn if the security is held to maturity. Dealer. A dealer acts as a principal in security transactions, selling securities from and buying securities for his own position. Debenture. A bond secured only by the general credit of the issuer. Delivery vs. Payment (DVP). A securities industry procedure whereby payment for a security must be made at the time the security is delivered to the purchaser’s agent. Derivative. Any security that has principal and/or interest payments which are subject to uncertainty (but not for reasons of default or credit risk) as to timing and/or amount, or any security which represents a component of another security which has been separated from other components (“Stripped” coupons and principal). A derivative is also defined as a financial instrument the value of which is totally or partially derived from the value of another instrument, interest rate, or index. Discount. The difference between the par value of a bond and the cost of the bond, when the cost is below par. Some short-term securities, such as T-bills and banker’s acceptances, are known as discount securities. They sell at a discount from par, and return the par value to the investor at maturity without additional interest. Other securities, which have fixed coupons, trade at a discount when the coupon rate is lower than the current market rate for securities of that maturity and/or quality. 3.A.8.a Packet Pg. 112 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) Diversification. Dividing investment funds among a variety of investments to avoid excessive exposure to any one source of risk. Duration. The weighted average time to maturity of a bond where the weights are the present values of the future cash flows. Duration measures the price sensitivity of a bond to changes in interest rates. (See modified duration). Federal Funds Rate. The rate of interest charged by banks for short-term loans to other banks. The Federal Reserve Bank through open-market operations establishes it. Federal Open Market Committee: A committee of the Federal Reserve Board that establishes monetary policy and executes it through temporary and permanent changes to the supply of bank reserves. Haircut: The margin or difference between the actual market value of a security and the value assessed by the lending side of a transaction (i.e. a repo). Leverage. Borrowing funds in order to invest in securities that have the potential to pay earnings at a rate higher than the cost of borrowing. Liquidity: The speed and ease with which an asset can be converted to cash. LOCAL AGENCY INVESTMENT FUND (LAIF). A voluntary investment fund open to government entities and certain non-profit organizations in California that is managed by the State Treasurer’s Office. LOCAL GOVERNMENT INVESTMENT POOL. Investment pools that range from the State Treasurer’s Office Local Agency Investment Fund (LAIF) to county pools, to Joint Powers Authorities (JPAs). These funds are not subject to the same SEC rules applicable to money market mutual funds. Make Whole Call. A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole." Margin: The difference between the market value of a security and the loan a broker makes using that security as collateral. Market Risk. The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates. Market Value. The price at which a security can be traded. Marking to Market. The process of posting current market values for securities in a portfolio. Maturity. The final date upon which the principal of a security becomes due and payable. Medium Term Notes. Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts on either a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences. Modified Duration. The percent change in price for a 100 basis point change in yields. Modified duration is the best single measure of a portfolio’s or security’s exposure to market risk. Money Market. The market in which short-term debt instruments (Tbills, discount notes, commercial paper, and banker’s acceptances) are issued and traded. Mortgage Pass-Through Securities. A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security. 3.A.8.a Packet Pg. 113 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) MUNICIPAL SECURITIES. Securities issued by state and local agencies to finance capital and operating expenses. Mutual Fund. An entity which pools the funds of investors and invests those funds in a set of securities which is specifically defined in the fund’s prospectus. Mutual funds can be invested in various types of domestic and/or international stocks, bonds, and money market instruments, as set forth in the individual fund’s prospectus. For most large, institutional investors, the costs associated with investing in mutual funds are higher than the investor can obtain through an individually managed portfolio. NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATION (NRSRO). A credit rating agency that the Securities and Exchange Commission in the United States uses for regulatory purposes. Credit rating agencies provide assessments of an investment's risk. The issuers of investments, especially debt securities, pay credit rating agencies to provide them with ratings. The three most prominent NRSROs are Fitch, S&P, and Moody's. NEGOTIABLE CD. A short-term debt instrument that pays interest and is issued by a bank, savings or federal association, state or federal credit union, or state-licensed branch of a foreign bank. Negotiable CDs are traded in a secondary market and are payable upon order to the bearer or initial depositor (investor). Premium. The difference between the par value of a bond and the cost of the bond, when the cost is above par. Prepayment Speed. A measure of how quickly principal is repaid to investors in mortgage securities. Prepayment Window. The time period over which principal repayments will be received on mortgage securities at a specified prepayment speed. Primary Dealer. A financial institution (1) that is a trading counterparty with the Federal Reserve in its execution of market operations to carry out U.S. monetary policy, and (2) that participates for statistical reporting purposes in compiling data on activity in the U.S. Government securities market. Prudent Person (Prudent Investor) Rule. A standard of responsibility which applies to fiduciaries. In California, the rule is stated as “Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes.” Realized Yield. The change in value of the portfolio due to interest received and interest earned and realized gains and losses. It does not give effect to changes in market value on securities, which have not been sold from the portfolio. Regional Dealer. A financial intermediary that buys and sells securities for the benefit of its customers without maintaining substantial inventories of securities and that is not a primary dealer. Repurchase Agreement (RP, Repo). Short-term purchases of securities with a simultaneous agreement to sell the securities back at a higher price. From the seller’s point of view, the same transaction is a reverse repurchase agreement. Safekeeping. A service to bank customers whereby securities are held by the bank in the customer’s name. Structured Note. A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities or indices. Examples include inverse floating rate 3.A.8.a Packet Pg. 114 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising, and "dual index floaters," which pay interest based on the relationship between two other interest rates - for example, the yield on the ten-year Treasury note minus the Libor rate. Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements. SUPRANATIONAL. A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries. Total Rate of Return. A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains, and losses in the portfolio. U.S. Treasury Obligations. Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk, and are the benchmark for interest rates on all other securities in the US and overseas. The Treasury issues both discounted securities and fixed coupon notes and bonds. Treasury Bills. All securities issued with initial maturities of one year or less are issued as discounted instruments, and are called Treasury bills. The Treasury currently issues three- and six-month Tbills at regular weekly auctions. It also issues “cash management” bills as needed to smooth out cash flows. Treasury Notes. All securities issued with initial maturities of two to ten years are called Treasury notes, and pay interest semi-annually. Treasury Bonds. All securities issued with initial maturities greater than ten years are called Treasury bonds. Like Treasury notes, they pay interest semi-annually. Volatility. The rate at which security prices change with changes in general economic conditions or the general level of interest rates. Yield to Maturity. The annualized internal rate of return on an investment which equates the expected cash flows from the investment to its cost. Copyright 2018 by Chandler Asset Management, Inc. 3.A.8.a Packet Pg. 115 Attachment: 11-01-22 Resolution - Statement of Investment Policy (Statement of Investment Policy) November 1, 2022 TO: City Council REQUESTED BY: Arthur Mullen, Water Utilities Superintendent APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Approval for the Purchase of a New Truck-Mounted Vacuum Unit for the Public Utilities Water Division RECOMMENDATION: Staff recommends that the City Council: 1. APPROVE the purchase of a new Model PV150 truck-mounted vacuum unit for the Public Utilities Water Department for the quoted price of $121,955.60 (One Hundred Twenty-One Thousand Nine Hundred Fifty-Five Dollars and Sixty Cents); and 2. APPROPRIATE funding in the amount of $121,956 (One Hundred Twenty-One Thousand Nine Hundred Fifty-Six Dollars) to account 050-9000-450.40-45 (Water - Capital - Machinery and Equipment). DISCUSSION: The Public Utilities Water Department currently operates multiple specialty vehicles custom- built for specific purposes. These vehicles are routinely replaced to maintain operational readiness and assist Water Division staff in the performance of essential job functions. In 2021, the Water Department’s vacuum truck was removed from service due to age. Enterprise Fleet Management, with whom the City has a fleet leasing agreement, was directed to locate a suitable replacement. Due to the nationwide supply shortage of vehicles, Enterprise was not able to locate a replacement chassis until recently. Enterprise notified the City that one truck chassis is available, and the City has directed Enterprise to procure the chassis under the terms of the existing fleet leasing agreement. While the chassis is being provided through Enterprise, the vacuum equipment must be custom manufactured and installed on the truck by a third-party vendor. Pres Tech Equipment Company, located in Garden Grove, CA, is a manufacturer of specialized water equipment, including both towable and truck-mounted vacuums, excavators, and pressure washers. The City, through Enterprise, received a quote for a model PV150 combination vacuum and pressure washer in the amount of $121,955.60. Because Pres Tech is a third-party company not affiliated with Enterprise, the City must purchase the vacuum system directly from Pres Tech, who will install it on the truck chassis and deliver it to the City upon completion. 3.A.9 Packet Pg. 116 Pres Tech’s PV150 is a truck-mounted unit comprised of a vacuum with a 150-gallon capacity, a pressure washer with a 60-gallon capacity, and a traffic director system to enhance the safety of staff. Once the truck chassis is delivered to Pres Tech, the lead time for manufacturing and installation of the unit is 36-40 weeks. Staff anticipates that once the unit enters service, the expected service life will be ten years. The vacuum truck is a key piece of equipment for the Public Utilities Water Department. It is routinely used to remove debris from water meter boxes, clear and clean subsurface holes caused by water leaks, and maintain the cleanliness of water valve compartments. These routine maintenance procedures contribute to prolonging the longevity of the City’s critical water infrastructure. In the absence of a vacuum truck, staff must conduct these operations by hand, resulting in decreased efficiency in the field. Approval of this item will allow staff to work more efficiently and conduct an increased amount of routine maintenance, thereby lowering both personnel and maintenance costs. FISCAL IMPACT: An appropriation of funds is needed to increase the Water Fund budget in account 050-9000- 450.40-45 (Capital – Machinery & Equipment) in the amount of $121,956. ATTACHMENTS: PV150 Quote and Specifications 3.A.9 Packet Pg. 117 Remit to: PO Box 1910, Westminster, CA 92684 1 Sub Total 121,955.60 Total $121,955.60 Balance Due $121,955.60 50% UPFRONT AND 50% DUE BEFORE DELIVERY- $60,977.80 DUE NOW *****TRUCK NOT INCLUDED****** *****CAB TO AXLE 60"***** **** FUEL TANK IN REAR**** Lead Time: 36-40 weeks for installation starts upon delivery of truck chassis to Garden Grove CA There will be a 2.9% service fee charge added to the total invoice amount if payment is made by credit card. Shipping is subject to change at anytime Terms & Conditions Returns: All returns must be pre-approved by Pres Tech and returned to Pres Tech in resalable condition. Returns are subject to 50% restocking charge fee; freight charges are non-refundable. Trailers and truck body units are non- returnable. No warranty will apply if the product has been subject to misuse, neglect, accident, modification, or altered in any way. Special orders are non- refundable. Any used equipment is not returnable and non-refundable. 7251 Garden Grove Blvd.,Ste. A Garden Grove, CA 92841 714-835-3440 INVOICE Invoice#: INV-000590 Invoice Date : 07-20-2022 Terms : COD/CC Due Date : 07-20-2022 P.O.#: SO-00420 Ship Via : DELIVERED FOB : SAN JACINTO Customer PO#: VBL Marbella 7-20-22 Bill To Ship To Enterprise 600 Corporate Park Drive Saint Louis, Missouri 63105-4204 Enterprise , City of San Jacinto Item No Item & Description Qty 1 PV150-W-Body 150 gallons debris Pressure washer system 60 gallons of fresh water Equipment powder coated- safety yellow Standard body coated black Underbody storage compartments Spray on liner Traffic director system 1 2 Delivery Delivery and Training 1 3.A.9.a Packet Pg. 118 Attachment: PV150 Quote and Specifications (Approval for the Purchase of a New Truck-Mounted Vacuum Unit for the Public Utilities Water November 1, 2022 TO: City Council REQUESTED BY: Tom Prill, Deputy City Manager APPROVED BY: Robert A. Johnson, City Manager SUBJECT: Investment Portfolio Review with Advisors RECOMMENDATION: Staff recommends that the City Council receive and file the Investment Portfolio Review. DISCUSSION: In May 2012, the City Council approved the use of two Investment Advisors to control a portfolio of $10 million each. Chandler Asset Management has maintained one portfolio for 10 years and 4 months, while Public Trust Advisors (formerly BLX) has maintained another portfolio for 10 years. Both Chandler and PTA will be in attendance to make brief presentations (attached) and to answer questions from the City Council. FISCAL IMPACT: None. ATTACHMENTS: Investment Report - 09-30-22 Annual Portfolio Review_2022 4.1 Packet Pg. 119 CHANDLER ASSET MANAGEMENT, INC. | 800.317.4747 | www.chandlerasset.com INVESTMENT REPORT Period Ending September 30, 2022 City of San Jacinto, California 4.1.a Packet Pg. 120 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) SECTION 1 Economic Update SECTION 2 Account Profile SECTION 3 Portfolio Holdings SECTION 4 Transactions Table of Contents As of September 30, 2022 1 4.1.a Packet Pg. 121 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) SECTION |Section 1 |Economic Update 2 4.1.a Packet Pg. 122 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Economic Update    Market volatility has intensified as financial conditions tighten and global central banks pursue monetary policies to combat persistently high inflation and maintain financial market stability.Labor markets and consumer balance sheets remain strong;however,inflation is weighing heavily on consumer sentiment and beginning to impact discretionary spending. Corporate earnings have generally performed better than expected,but warnings are growing along with wider credit spreads.While evidence of slowereconomic conditions has begun to mount,we expect the Federal Reserve to continue to raise rates until a sustainable improvement in inflationary conditions has been achieved.Over the near-term,we expect financial market volatility to remain intensified and conditions tighter with persistent inflation, geopolitical risk,and the Fed's hawkish monetary policy. At the Septembermeeting,the Federal Open Market Committee (FOMC)delivered the third 75-basis point increase to the Fed Funds Rate, increasing the range to 3.00% to 3.25%. The FOMC acknowledged spending and production are experiencing modest growth,offset by a robust labor market and elevated inflation metrics. We expect the Fed to continue to increase the federal funds rate in the near term until inflationary pressures weaken. In September,yields rose significantly across the curve.The 2-year Treasury yield increased 79 basis points to 4.28%,the 5- year Treasury yield rose 74 basis points to 4.09%,and the 10-year Treasury yield gained 64 basis points to 3.83%.The spread between the 2-year Treasury yield and 10-year Treasury yield became more inverted at -45 basis points at September month-end versus -30 basis points at August month-end.The spread was a positive 121 basis points one year ago.The spread between 3-month and 10-year treasuries widened to 56 basis points in September compared to just 27 basis points in August.The shape of the curve does not necessarily indicate an imminent recession but bears watching as a better predictor of recession over the medium-term. 3 4.1.a Packet Pg. 123 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: US Department of Labor Source: US Department of Labor Employment The U.S.economy added 263,000 jobs in September,surpassing market expectations of 255,000,and gains were revised upward by 11,000 for the prior two months. Trends in employment remain strong,with the three-month moving average payrolls at 372,000 and the six-month moving average at 360,000.Hiring was widespread,with solid increases in education and health services,leisure and hospitality,and professional and business services.The unemployment rate fell to 3.5%from 3.7%,as the labor participation rate edged down to 62.3%in September from 62.4%in August.The U-6 underemployment rate,which includes those who are marginally attached to the labor force and employed part time for economic reasons dropped to 6.7%from 7.0%last month.Average hourly earnings rose 5.0%year-over-year in September compared to 5.2%year-over-year in August,a constructive development for the inflation outlook.The strong September labor report bolsters the case for the Fed to continue raising the federal funds rate. -200 0 200 400 600 800 1,000 1,200 1,400 MOM Change In (000's)Nonfarm Payroll (000's) Non-farm Payroll (000's) 3 month average (000's) 0.0% 4.0% 8.0% 12.0% 16.0% Unemployment Rate Underemployment Rate (U6) Unemployment Rate (U3)Rate (%)4 4.1.a Packet Pg. 124 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: US Department of Labor Source: US Department of Commerce Inflation The Consumer Price Index (CPI)increased more than expected in September,up 8.2%year-over-year versus consensus expectations for 8.1%, but down slightly from 8.3%in August.The Core CPI,which excludes volatile food and energy components, jumped to 6.6%year-over-year,up from 6.3%in August and the highest level since 1982.The report included widespread increases,particularly in food,shelter,and medical care services.Owners’equivalent rent,which is a major contributor to CPI and tends to lag, was up 6.7%year-over-year.The Personal Consumption Expenditures (PCE)index rose 6.2%in August, higher than consensus estimates of up 6.0%,but down from a 6.4%increase last month.Core PCE was up 4.9%year-over-year in August,versus up 4.7%year-over-year in July.Persistently elevated inflation islikely to keep the Federal Reserve on the path of tightening monetary policy as long as it continues to run well above the Fed’s longer-run target of around 2.0%. 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% Personal Consumption Expenditures (PCE) PCE Price Deflator YOY % Change PCE Core Deflator YOY % Change YOY( %) Change0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% Consumer Price Index (CPI) CPI YOY % Change Core CPI YOY % Change YOY( %) Change5 4.1.a Packet Pg. 125 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Advance retail sales were flat for the month but up 8.2%year-over-year in September,slowing from August’s 9.4%year-over-year gain that surprised to the upside.Retail sales growth is starting to reflect the headwinds from higher prices as consumers dip into savings and assume more debt.The Conference Board’s Consumer Confidence Index rose for the second month in a row to 108.0 in September,with gains in both the present situation and future expectations components.The strength was tied directly to the consumer's assessment of the labor market, which continues to reflect the demand for labor outstripping supply. Source: US Department of Commerce Source: The Conference Board 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Retail Sales YOY % Change YOY (%) Change80 90 100 110 120 130 140 Index LevelConsumer Confidence Consumer 6 4.1.a Packet Pg. 126 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: The Conference Board Source: Federal Reserve Bank of Chicago Economic Activity The Conference Board’s Leading Economic Index (LEI)remained in negative territory at -0.4%in September,following an upwardly revised 0% in August.The LEI is down 2.8%for the six-month period between March and September 2022,versus its 1.4%growth over the previous six months.The Conference Board cited widespread weakness among the index's ten components and expects slower economic growth going forward.The Chicago Fed National Activity Index (CFNAI)was unchanged at 0.10 in September indicating steady economic growth over the month. On a 3-month moving average basis, the CFNAI increased to 0.17 in September from an upwardly revised 0.04 in August. -2.00 -1.00 0.00 1.00 2.00 Chicago Fed National Activity Index (CFNAI)3 Month Average-0.8% -0.6% -0.4% -0.2% 0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 1.2% Leading Economic Indicators (LEI)MOM ( %) Change7 4.1.a Packet Pg. 127 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: US Department of Commerce Source: S&P Housing 0 200 400 600 800 1000 1200 1400 1600 1800 2000 MOM Change (In Thousands of Units)Housing Starts Multi Family Housing Starts Single Family Housing Starts 0.0% 3.0% 6.0% 9.0% 12.0% 15.0% 18.0% 21.0% 24.0% S&P/Case -Shiller 20 City Composite Home Price Index YOY( %) ChangeTotal housing starts declined 8.1%to an annual rate of 1,439,000 in September,after a downward revision to 1,566,000 units in August.Single- family home starts fell 4.7%and multi-family starts fell 13.2%month-over-month.On a year-over-year basis,total housing starts decreased 7.7%reflecting a shift from single-family units to more affordable multi-family units as homebuyers struggle with a combination of elevated prices and higher mortgage rates.Mortgage rates for a 30-year fixed-rate loan are higher than they have been since 2006 at 6.94%According to the Case-Shiller 20-City Home Price Index,the year-over-year increase receded from 18.7%in June to 16.1%in July,clearly displaying the impact of higher mortgage rates which have reduced demand for homebuying as affordability has declined. 8 4.1.a Packet Pg. 128 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: Institute for Supply Management Source: Federal Reserve Manufacturing The Institute for Suppl y Management (ISM)manufacturing index plunged nearly two points to 50.9 in September,the lowest since May 2020 and disappointing relative to consensus expectations of 52.0.Readings above 50.0 are indicative of expansion in the manufacturing sector. New orders declined significantly,reflecting lower demand for goods as consumers shift to spending on services.Total industrial production rose 0.4%in September after a small upward revision to -0.1%in August.Gains were broad-based including both durable and non-durable goods.Capacity utilization increased to 80.3%in September after a minimal upward revision to 80.1%in August and continues to run slightly above the 1972-2021 average of 79.6%. 40 42 44 46 48 50 52 54 56 58 60 62 64 66 Institute of Supply Management Purchasing Manager Index EXPANDING CONTRACTING -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% Industrial Production YOY( %) Change9 4.1.a Packet Pg. 129 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: US Department of Commerce Source: US Department of Commerce 9/21 12/21 3/22 6/22 2.0% 2.1% 0.9% 1.4% 1.8% 5.1% 1.0% -2.8% -1.1% -0.2% -3.1% 1.2% -0.5% 0.0% -0.4% -0.2% 0.5% -0.2% 0.0% -0.1% 2.7% 7.0% -1.6% -0.6% Components of GDP Federal Government Expenditures State and Local (Consumption and Gross Investment) Net Exports and Imports Total Gross Private Domestic Investment Personal Consumption Expenditures -35.0%-30.0%-25.0%-20.0%-15.0%-10.0%-5.0%0.0%5.0%10.0%15.0%20.0%25.0%30.0%35.0%40.0% Gross Domestic Product (GDP) GDP QOQ % Change GDP YOY % Change Gross Domestic Product (GDP) According to the third estimate,U.S.GDP was unrevised at -0.6%annualized in the second quarter. Personal consumption expenditures rose, primarily due to spending on services.The largest negative contribution was from a drop in gross residential investment as the housing sector diminished sharply.The second quarter decline followed a first quarter contraction of -1.6%.Although many market participants link two quarters in a row of negative GDP growth with a recession,an official declaration by the National Bureau of Economic Research is unlikely given the mosaic of data and the strength of the labor market.The consensus estimate calls for 1.9%growth in the third quarter and 1.7% growth for the full year 2022. 10 4.1.a Packet Pg. 130 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Federal Reserve Source: Federal Reserve Source: Bloomberg At the September meeting,the Federal Open Market Committee (FOMC)delivered the third 75-basis point increase to the Fed Funds Rate, increasing the range to 3.00%to 3.25%.The FOMC acknowledged spending and production are experiencing modest growth,offset by robust labor market and elevated inflation metrics.The FOMC remains data dependent to meet its long-term 2%inflation objective.The Fed also released new economic projections showing a significant slowdown in the economy later in 2022 and 2023.The Fed has reduced its $9 trillion balance sheet holdings by $87.1 billion since the start of the program and will increase the rate of decrease to $95 billion a month in September.As inflation metrics begin to moderate,we believe the Federal Reserve will decelerate their pace of tightening, but a material decline in inflation in the short-term is unlikely. 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% Effective Federal Funds Rate Yield (%)2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 10,000,000 Federal Reserve Balance Sheet Assets In$ millions11 4.1.a Packet Pg. 131 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Source: Bloomberg Source: Bloomberg 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% US Treasury Note Yields 2-Year 5-Year 10-Year Yield (%)0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% US Treasury Yield Curve Sep-22 Jun-22 Sep-21Yield (%)Bond Yields At the end of September,the 2-year Treasury yield was 400 basis points higher,and the 10-Year Treasury yield was about 234 basis points higher,year-over-year.The spread between the 2-year Treasury yield and 10-year Treasury yield became more inverted at -45 basis points at September month-end versus -30 basis points at Augustmonth-end.The average historical spread (since 2003)is about 130 basis points.The spread between 3-month and 10-year treasuries widened to 56 basis points in September compared to just 27 basis points in August.The shape of the yield curve does not indicate an imminent recession but bears watching as a better predictor of recession over the medium-term. 12 4.1.a Packet Pg. 132 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Section 2|SECTION |Section 2 |Account Profile 13 4.1.a Packet Pg. 133 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Objectives Chandler Asset Management Performance Objective The performance objective for the portfolio is to earn a total rate of return over a market cycle that equals or exceeds the benchmark, the ICE BofA 1-5 Year US Treasury &Agency Index. Investment Objectives The City of San Jacinto’s investment objectives,in order of priority,are to provide safety to ensure the preservation of capital in the overall portfolio,provide sufficient liquidity for cash needs and a market rate of return consistent with the investment program. Strategy In order to achieve these objectives,the portfolio invests in high quality fixed income securities consistent with the investment policy and California Government Code. As of September 30, 2022 14 4.1.a Packet Pg. 134 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Compliance As of September 30, 2022 Category Standard Comment U.S. Treasuries No limitations; Full faith and credit of the U.S. are pledged for the payment of principal and interest Complies Federal Agencies No Limitations; Federal agencies or U.S. government-sponsored enterprise obligations, participations, or other instruments, including those issued or fully guaranteed as to principal and interest by federal agencies or U.S. government sponsored enterprises.Complies Supranational Obligations "AA" rating category or better by a NRSRO; 30% maximum; 10% max per issuer; U.S. dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development ("IBRD"), the International Finance Corporation ("IFC") or the Inter-American Development Bank ("IADB") Complies Municipal Securities "A" rating category or better by a NRSRO; 30% maximum; 5% max per issuer Complies Corporate Medium Term Notes "A" rating category or better by at least two NRSROs; 30% maximum; 5% max per issuer; Issued by corporations organized and operating within the U.S. or by depository institutions licensed by the U.S. or any state and operating within the U.S. Complies Asset-Backed (ABS), Mortgage- Backed Securities; Mortgage Pass- Throughs; Collateralized Mortgage Obligations (CMOs) "AA" rating category or better by at least two NRSROs; "A" issuer rating category or higher by at least two NRSROs; 20% maximum; 5% max per issuer Complies Negotiable Certificates of Deposit (NCD) "A" long-term issuer rating category or higher by at least two NRSROs; and/or "A-1" short term rated or higher by at least two NRSROs; 30% maximum; 5% max per issuer Complies Certificate of Deposit Placement Service (CDARS)30% max (combination of Certificates of Deposit, including CDARS)Complies FDIC Insured Time Deposits (Non- negotiable CD/TD) 20% maximum (combined FDIC insured and collateralized TD/ CD); Amount per institution is limited to maximum covered under federal insurance Complies Collateralized Time Deposits (Non- negotiable CD/TD) "A" long-term debt rating category or higher by at least two NRSROs; and/or "A-1" short term debt rated or higher by at least two NRSROs; 20% maximum (combined FDIC and collateralized TD/ CD)Complies Collateralized Bank Deposits City's deposits with financial institutions will be collateralized with pledged securities per California Government Code Complies Banker’s Acceptances "A-1" short term debt rated or higher by at least two NRSROs; and "A" long-term debt rated or higher by at least two NRSROs; 40% maximum; 5% max per issuer; 180 days max maturity Complies Commercial Paper "A-1" short term debt rated or higher by at least two NRSROs; and "A" long-term debt rated or higher by at least two NRSROs; 25% maximum; 5% max per issuer; 270 days max maturity; Issuer is a corporation organized and operating in the U.S. with assets > $500 million Complies Money Market Mutual Funds Registered with SEC under Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria: (i) Highest rating by two NRSROs; or (ii) Retained an investment adviser registered or exempt from SEC registration with > 5 years experience managing money market mutual funds with AUM >$500 million; 20% max combined Money Market Mutual Funds and Mutual Funds; 20% max per Money Market Mutual Fund Complies Mutual Funds Invest in securities as authorized under CGC, Section 53601 (a) to (k) and (m) to (q) inclusive and meet either of the following criteria: (i) Highest rating by two NRSROs; or (ii) Retained an investment adviser registered or exempt from SEC registration with > 5 years experience investing in securities authorized by CGC, Section 53601 and with AUM >$500 million; 20% max combined Money Market Mutual Funds and Mutual Funds; 10% max per Mutual Fund Complies Local Agency Investment Fund (LAIF) 70% of the portfolio may be invested in LAIF, up to the maximum permitted balance; Not used by investment adviser Complies City of San Jacinto Assets managed by Chandler Asset Management are in full compliance with state law and with the City's investment policy. 15 4.1.a Packet Pg. 135 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Compliance As of September 30, 2022 Category Standard Comment Local Government Investment Pools and Joint Powers Authority Pools Riverside County Investment Fund- 70% max of the total portfolio JPA Pools- 50% max of the total portfolio Complies Repurchase Agreements 102% collateralized; 1 year max maturity Complies Prohibited Securities Any investments not specifically described in the policy; Futures and options; Inverse floaters; Ranges notes, Interest-only strips from mortgaged backed securities; Zero interest accrual securities if held to maturity; Margin purchasing or selling; Reverse repurchase agreements; Foreign currency denominated securities Complies Max Callables 20% maximum callable securities (does not include "make whole call" securities)Complies Max Per Issuer 5% of portfolio per issuer (except U.S. Government, its Agencies and enterprises, Money Market Mutual Funds, Mutual Funds, LAIF, LGIP, Supranationals, or unless otherwise specified in the investment policy)Complies Maximum Maturity 5 years Complies City of San Jacinto Assets managed by Chandler Asset Management are in full compliance with state law and with the City's investment policy. 16 4.1.a Packet Pg. 136 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Portfolio Characteristics City of San Jacinto 09/30/22 06/30/22 Benchmark*Portfolio Portfolio Average Maturity (yrs)2.60 2.48 2.65 Average Modified Duration 2.48 2.26 2.42 Average Purchase Yield n/a 1.50%1.43% Average Market Yield 4.26%4.34%3.09% Average Quality**AAA AA+/Aa1 AA+/Aa1 Total Market Value 10,578,863 10,785,333 *ICE BofA 1-5 Yr US Treasury & Agency Index **Benchmark is a blended rating of S&P, Moody’s, and Fitch. Portfolio is S&P and Moody’s respectively. As of September 30, 2022 17 4.1.a Packet Pg. 137 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) City of San Jacinto Sector Distribution ABS 6.4% Agency 35.4% Corporate 19.5% Money Market Fund 0.1% Supranational 1.9% US Treasury 36.7% September 30, 2022 June 30, 2022 ABS 6.6% Agency 36.2% Corporate 18.1% Money Market Fund 0.1% Supranational 2.0% US Treasury 37.0% As of September 30, 2022 18 4.1.a Packet Pg. 138 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Duration Allocation As of September 30, 2022 City of San Jacinto 0 -0.25 0.25 -0.50 0.50 - 1 1 - 2 2 - 3 3 - 4 4 - 5 5+ 09/30/22 0.4%7.0%9.4%22.7%31.0%20.1%9.3%0.0% 0% 5% 10% 15% 20% 25% 30% 35% 0 - 0.25 Years 0.25 - 0.5 Years 0.5 - 1 Years 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years 5+ Years ABS Agency Corporate Money Market Fund Supranational US Treasury 19 4.1.a Packet Pg. 139 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Portfolio Allocation & Duration Changes City of San Jacinto As of September 30, 2022 Benchmark: ICE BofA 1-5 Yr US Treasury & Agency Index 91.3% 96.8% 99.0%99.2%101.3%102.4% 98.1%99.8% 80.0% 85.0% 90.0% 95.0% 100.0% 105.0% 110.0% 09/30/2206/30/2203/31/2212/31/2109/30/2106/30/2103/31/2112/31/20 Duration as a % of the Benchmark 0.1% 2.0% 6.6% 18.1% 36.2% 37.0% 0.1% 1.9% 6.4% 19.5% 35.4% 36.7% Money Market Fund Supranational ABS Corporate Agency US Treasury Portfolio Allocation 09/30/22 06/30/22 20 4.1.a Packet Pg. 140 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 0 - 0.25 0.25 - 0.50 0.50 - 1 1 - 2 2 - 3 3 - 4 4 - 5 5+ City of San Jacinto ICE BofA 1-5 Yr US Treasury & Agency Index Portfolio Compared to the Benchmark 0 -0.25 0.25 -0.50 0.50 - 1 1 - 2 2 - 3 3 - 4 4 - 5 5+ Portfolio 0.4% 7.0% 9.4% 22.7% 31.0% 20.1% 9.3% 0.0% Benchmark*0.0% 0.0% 1.8% 37.2% 26.6% 20.9% 13.5% 0.0% *ICE BofA 1-5 Yr US Treasury & Agency Index Duration Distribution City of San Jacinto As of September 30, 2022 21 4.1.a Packet Pg. 141 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Issue Name Investment Type % Portfolio Government of United States US Treasury 36.70% Federal National Mortgage Association Agency 14.97% Federal Home Loan Bank Agency 11.52% Federal Home Loan Mortgage Corp Agency 8.87% Berkshire Hathaway Corporate 2.53% Inter-American Dev Bank Supranational 1.94% John Deere ABS ABS 1.93% Apple Inc Corporate 1.89% Royal Bank of Canada Corporate 1.71% Honda ABS ABS 1.69% Toronto Dominion Holdings Corporate 1.62% Toyota ABS ABS 1.42% Deere & Company Corporate 1.41% Bank of New York Corporate 1.37% JP Morgan Chase & Co Corporate 1.37% Amazon.com Inc Corporate 1.34% Northern Trust Corp Corporate 1.20% Toyota Motor Corp Corporate 1.00% Charles Schwab Corp/The Corporate 0.74% United Health Group Inc Corporate 0.71% Bank of America Corp Corporate 0.66% BMW Vehicle Lease Trust ABS 0.64% Morgan Stanley Corporate 0.56% Target Corp Corporate 0.55% Wal-Mart Stores Corporate 0.53% Mercedes-Benz Auto Lease Trust ABS 0.50% State Street Bank Corporate 0.31% Nissan ABS ABS 0.18% First American Govt Oblig Fund Money Market Fund 0.14% TOTAL 100.00% Issuers City of San Jacinto –Account #10167 As of September 30, 2022 22 4.1.a Packet Pg. 142 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) AAA AA A <A NR 09/30/22 5.1%78.3%13.2%0.0%3.4% 06/30/22 5.5%79.3%12.1%0.0%3.2% Source: S&P Ratings September 30, 2022 vs. June 30, 2022 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% AAA AA A <A NR September 30, 2022 June 30, 2022 Quality Distribution City of San Jacinto As of September 30, 2022 23 4.1.a Packet Pg. 143 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Total Rate of Return Annualized Since Inception June 30, 2012 *ICE BofA 1-3 Yr US Treasury Index to 3/31/20; then ICE BofA 1-5 Yr US Treasury & Agency Index Total rate of return: A measure of a portfolio’s performance over time.It is the internal rate of return,which equates the beginning value of the portfolio with the ending value;it includes interest earnings,realized and unrealized gains and losses in the portfolio. Investment Performance City of San Jacinto -8.00% -7.00% -6.00% -5.00% -4.00% -3.00% -2.00% -1.00% 0.00% 1.00% 2.00% 12 months 2 years 3 years 5 years 10 years Since Inception City of San Jacinto San Jacinto 1-5 Yr US Tsy & Agy Blended Index*San Jacinto 1-5 Yr AAA-A US Corp & Govt Blend* Annualized TOTAL RATE OF RETURN 3 months 12 months 2 years 3 years 5 years 10 years Since Inception City of San Jacinto -1.89%-6.33%-3.31%-0.79%0.49%0.64%0.66% San Jacinto 1-5 Yr US Tsy & Agy Blended Index*-2.28%-6.77%-3.63%-1.22%0.12%0.37%0.39% San Jacinto 1-5 Yr AAA-A US Corp & Govt Blend*-2.27%-6.90%-3.64% -1.24% 0.17% 0.49% 0.53% As of September 30, 2022 24 4.1.a Packet Pg. 144 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) SECTION |Section 3 |Portfolio Holdings 25 4.1.a Packet Pg. 145 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration ABS 43815NAC8 Honda Auto Receivables Trust 2019-3 A3 1.780% Due 08/15/2023 5,434.30 08/20/2019 1.79% 5,434.25 5,434.30 99.89 3.58% 5,428.29 4.30 0.05% (6.01) Aaa / AAA NR 0.87 0.06 477870AC3 John Deere Owner Trust 2019-B A3 2.210% Due 12/15/2023 2,262.59 07/16/2019 2.23% 2,262.11 2,262.46 99.88 3.61% 2,259.94 2.22 0.02% (2.52) Aaa / NR AAA 1.21 0.08 65479JAD5 Nissan Auto Receivables Owner 2019-C A3 1.930% Due 07/15/2024 18,846.76 10/16/2019 1.94% 18,845.75 18,846.38 99.62 3.76% 18,775.43 16.17 0.18% (70.95) Aaa / AAA NR 1.79 0.21 47789KAC7 John Deere Owner Trust 2020-A A3 1.100% Due 08/15/2024 21,611.56 03/04/2020 1.11% 21,610.23 21,611.00 99.01 4.14% 21,397.17 10.57 0.20% (213.83) Aaa / NR AAA 1.88 0.32 89237VAB5 Toyota Auto Receivables Trust 2020-C A3 0.440% Due 10/15/2024 28,089.57 07/21/2020 0.44% 28,087.40 28,088.52 98.35 4.45% 27,627.24 5.49 0.26% (461.28) Aaa / AAA NR 2.04 0.41 43813KAC6 Honda Auto Receivables Trust 2020-3 A3 0.370% Due 10/18/2024 59,351.24 09/22/2020 0.38% 59,342.52 59,348.09 97.82 4.54% 58,058.21 7.93 0.55% (1,289.88) NR / AAA AAA 2.05 0.52 47787NAC3 John Deere Owner Trust 2020-B A3 0.510% Due 11/15/2024 12,426.29 07/14/2020 0.52% 12,424.39 12,425.59 98.05 4.85% 12,184.16 2.82 0.12% (241.43) Aaa / NR AAA 2.13 0.45 58769KAD6 Mercedes-Benz Auto Lease Trust 2021-B A3 0.400% Due 11/15/2024 55,000.00 06/22/2021 0.40% 54,995.85 54,997.90 96.54 4.75% 53,098.05 9.78 0.50% (1,899.85) NR / AAA AAA 2.13 0.80 09690AAC7 BMW Vehicle Lease Trust 2021-2 A3 0.330% Due 12/26/2024 35,000.00 09/08/2021 0.34% 34,996.39 34,998.05 97.15 4.51% 34,001.98 1.93 0.32% (996.07) Aaa / NR AAA 2.24 0.68 89236XAC0 Toyota Auto Receivables 2020-D A3 0.350% Due 01/15/2025 28,505.98 10/06/2020 0.36% 28,500.66 28,503.12 98.07 4.58% 27,954.90 4.43 0.26% (548.22) NR / AAA AAA 2.30 0.46 05601XAC3 BMW Vehicle Lease Trust 2022-1 A3 1.100% Due 03/25/2025 35,000.00 01/11/2022 1.11% 34,994.77 34,996.45 96.29 4.76% 33,700.28 6.42 0.32% (1,296.17) NR / AAA AAA 2.48 1.02 43813GAC5 Honda Auto Receivables Trust 2021-1 A3 0.270% Due 04/21/2025 26,150.31 02/17/2021 0.27% 26,149.84 26,150.08 97.08 4.95% 25,387.48 1.96 0.24% (762.60) Aaa / NR AAA 2.56 0.62 89240BAC2 Toyota Auto Receivables Owners 2021-A A3 0.260% Due 05/15/2025 63,385.52 02/02/2021 0.27% 63,373.75 63,379.99 97.43 4.30% 61,758.67 7.32 0.58% (1,621.32) Aaa / NR AAA 2.62 0.63 47788UAC6 John Deere Owner Trust 2021-A A3 0.360% Due 09/15/2025 40,000.00 03/02/2021 0.37% 39,992.31 39,995.64 96.11 4.92% 38,442.40 6.40 0.36% (1,553.24) Aaa / NR AAA 2.96 0.86 43815GAC3 Honda Auto Receivables Trust 2021-4 A3 0.880% Due 01/21/2026 35,000.00 11/16/2021 0.89% 34,992.62 34,994.56 94.61 4.70% 33,113.96 8.56 0.31% (1,880.60) Aaa / NR AAA 3.31 1.43 47789QAC4 John Deere Owner Trust 2021-B A3 0.520% Due 03/16/2026 45,000.00 07/13/2021 0.52% 44,995.99 44,997.30 94.50 4.71% 42,526.17 10.40 0.40% (2,471.13) Aaa / NR AAA 3.46 1.33 89238JAC9 Toyota Auto Receivables Trust 2021-D A3 0.710% Due 04/15/2026 35,000.00 11/09/2021 0.71% 34,999.25 34,999.45 94.72 4.62% 33,153.26 11.04 0.31% (1,846.19) NR / AAA AAA 3.54 1.37 As of September 30, 2022 26 4.1.a Packet Pg. 146 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration 43815BAC4 Honda Auto Receivables Trust 2022-1 A3 1.880% Due 05/15/2026 60,000.00 02/15/2022 1.89% 59,990.98 59,992.67 95.03 4.81% 57,018.36 50.13 0.54% (2,974.31) Aaa / AAA NR 3.62 1.73 47787JAC2 John Deere Owner Trust 2022-A A3 2.320% Due 09/16/2026 45,000.00 03/10/2022 2.34% 44,990.05 44,991.60 95.59 5.00% 43,017.66 46.40 0.41% (1,973.94) Aaa / NR AAA 3.96 1.67 47800AAC4 John Deere Owner Trust 2022-B A3 3.740% Due 02/16/2027 45,000.00 07/12/2022 3.77% 44,995.70 44,995.94 97.65 4.86% 43,944.44 74.80 0.42% (1,051.50) Aaa / NR AAA 4.38 2.16 TOTAL ABS 696,064.12 1.02% 695,974.81 696,009.09 4.63% 672,848.05 289.07 6.36% (23,161.04) Aaa / AAA Aaa 2.83 1.00 Agency 3135G0T94 FNMA Note 2.375% Due 01/19/2023 290,000.00 10/17/2018 3.07% 281,993.10 289,432.87 99.61 3.65% 288,875.67 1,377.50 2.74% (557.20) Aaa / AA+ AAA 0.30 0.30 3137EAEN5 FHLMC Note 2.750% Due 06/19/2023 200,000.00 11/13/2018 3.08% 197,176.00 199,560.75 98.93 4.27% 197,859.60 1,558.33 1.89% (1,701.15) Aaa / AA+ AAA 0.72 0.70 313383YJ4 FHLB Note 3.375% Due 09/08/2023 200,000.00 12/27/2018 2.73% 205,630.00 201,122.72 99.10 4.36% 198,205.40 431.25 1.88% (2,917.32) Aaa / AA+ NR 0.94 0.91 3137EAEY1 FHLMC Note 0.125% Due 10/16/2023 180,000.00 10/22/2020 0.26% 179,253.00 179,739.10 95.71 4.37% 172,280.52 103.13 1.63% (7,458.58) Aaa / AA+ AAA 1.04 1.02 3130A0F70 FHLB Note 3.375% Due 12/08/2023 220,000.00 01/30/2019 2.71% 226,593.40 221,611.14 98.80 4.42% 217,349.66 2,330.63 2.08% (4,261.48) Aaa / AA+ AAA 1.19 1.14 3135G0V34 FNMA Note 2.500% Due 02/05/2024 375,000.00 03/24/2020 0.82% 398,835.00 383,305.11 97.59 4.36% 365,977.88 1,458.33 3.47% (17,327.23) Aaa / AA+ AAA 1.35 1.30 3130A1XJ2 FHLB Note 2.875% Due 06/14/2024 210,000.00 Various 1.96% 219,055.20 213,089.60 97.52 4.40% 204,782.56 1,794.48 1.95% (8,307.04) Aaa / AA+ NR 1.71 1.63 3130A2UW4 FHLB Note 2.875% Due 09/13/2024 150,000.00 10/29/2019 1.76% 157,737.00 153,099.15 97.26 4.35% 145,886.25 215.63 1.38% (7,212.90) Aaa / AA+ AAA 1.96 1.87 3130A3GE8 FHLB Note 2.750% Due 12/13/2024 250,000.00 12/16/2019 1.77% 261,672.50 255,147.94 96.71 4.33% 241,765.50 2,062.50 2.30% (13,382.44) Aaa / AA+ NR 2.21 2.09 3135G0X24 FNMA Note 1.625% Due 01/07/2025 225,000.00 01/16/2020 1.69% 224,298.00 224,679.71 94.36 4.26% 212,304.83 853.13 2.01% (12,374.88) Aaa / AA+ AAA 2.27 2.18 3137EAEP0 FHLMC Note 1.500% Due 02/12/2025 245,000.00 02/13/2020 1.52% 244,811.35 244,910.59 93.94 4.22% 230,143.94 500.21 2.18% (14,766.65) Aaa / AA+ AAA 2.37 2.28 3135G03U5 FNMA Note 0.625% Due 04/22/2025 310,000.00 Various 0.63% 309,949.40 309,978.70 91.14 4.32% 282,535.86 855.73 2.68% (27,442.84) Aaa / AA+ AAA 2.56 2.48 3130AJKW8 FHLB Note 0.500% Due 06/13/2025 225,000.00 06/24/2020 0.52% 224,824.50 224,904.61 90.60 4.22% 203,844.83 337.50 1.93% (21,059.78) Aaa / AA+ AAA 2.70 2.63 As of September 30, 2022 27 4.1.a Packet Pg. 147 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration 3137EAEU9 FHLMC Note 0.375% Due 07/21/2025 145,000.00 07/21/2020 0.48% 144,277.90 144,594.61 89.73 4.30% 130,107.49 105.73 1.23% (14,487.12) Aaa / AA+ AAA 2.81 2.73 3135G05X7 FNMA Note 0.375% Due 08/25/2025 230,000.00 08/25/2020 0.47% 228,923.60 229,375.05 89.43 4.29% 205,688.08 86.25 1.95% (23,686.97) Aaa / AA+ AAA 2.90 2.83 3137EAEX3 FHLMC Note 0.375% Due 09/23/2025 230,000.00 09/23/2020 0.44% 229,307.70 229,587.05 89.25 4.25% 205,279.83 19.17 1.94% (24,307.22) Aaa / AA+ AAA 2.98 2.90 3135G06G3 FNMA Note 0.500% Due 11/07/2025 250,000.00 11/09/2020 0.57% 249,105.00 249,443.14 89.07 4.30% 222,672.50 500.00 2.11% (26,770.64) Aaa / AA+ AAA 3.11 3.01 TOTAL Agency 3,935,000.00 1.43% 3,983,442.65 3,953,581.84 4.26% 3,725,560.40 14,589.50 35.35% (228,021.44) Aaa / AA+ Aaa 1.90 1.84 Corporate 06051GEU9 Bank of America Corp Note 3.300% Due 01/11/2023 70,000.00 01/28/2019 3.29% 70,032.20 70,002.28 99.75 4.17% 69,825.98 513.33 0.66% (176.30) A2 / A- AA- 0.28 0.28 06406RAE7 Bank of NY Mellon Corp Callable Note Cont 12/29/2022 2.950% Due 01/29/2023 145,000.00 09/09/2019 1.97% 149,541.40 145,335.42 99.60 4.15% 144,421.31 736.68 1.37% (914.11) A1 / A AA- 0.33 0.33 084670BR8 Berkshire Hathaway Callable Note Cont 1/15/2023 2.750% Due 03/15/2023 150,000.00 08/26/2019 1.83% 154,525.50 150,388.11 99.46 3.95% 149,188.95 183.33 1.41% (1,199.16) Aa2 / AA A+ 0.45 0.45 037833AK6 Apple Inc Note 2.400% Due 05/03/2023 200,000.00 05/20/2019 2.63% 198,284.00 199,745.34 98.91 4.29% 197,814.20 1,973.33 1.89% (1,931.14) Aaa / AA+ NR 0.59 0.57 24422EUR8 John Deere Capital Corp Note 3.450% Due 01/10/2024 150,000.00 03/14/2019 2.95% 153,322.50 150,880.21 98.65 4.54% 147,979.05 1,164.38 1.41% (2,901.16) A2 / A A 1.28 1.22 808513BN4 Charles Schwab Corp Callable Note Cont 2/18/2024 0.750% Due 03/18/2024 40,000.00 03/16/2021 0.77% 39,980.00 39,990.26 94.59 4.60% 37,836.96 10.83 0.36% (2,153.30) A2 / A A 1.47 1.43 023135BW5 Amazon.com Inc Note 0.450% Due 05/12/2024 90,000.00 05/10/2021 0.50% 89,868.60 89,929.38 93.77 4.49% 84,388.50 156.38 0.80% (5,540.88) A1 / AA AA- 1.62 1.57 46625HJX9 JP Morgan Chase Note 3.625% Due 05/13/2024 145,000.00 12/19/2019 2.20% 153,560.80 148,152.85 98.31 4.72% 142,545.15 2,014.90 1.37% (5,607.70) A1 / A- AA- 1.62 1.53 78015K7H1 Royal Bank of Canada Note 1.150% Due 06/10/2025 200,000.00 10/14/2021 1.17% 199,878.00 199,909.90 90.25 5.07% 180,503.00 709.17 1.71% (19,406.90) A1 / A AA- 2.70 2.58 931142EW9 Wal-Mart Stores Note 3.900% Due 09/09/2025 30,000.00 09/06/2022 3.92% 29,979.00 29,979.42 98.21 4.55% 29,464.32 71.50 0.28% (515.10) Aa2 / AA AA 2.95 2.74 857477BR3 State Street Bank Callable Note Cont 2/6/2025 1.746% Due 02/06/2026 35,000.00 02/02/2022 1.75% 35,000.00 35,000.00 93.15 4.85% 32,603.90 93.36 0.31% (2,396.10) A1 / A AA- 3.36 3.17 As of September 30, 2022 28 4.1.a Packet Pg. 148 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration 91324PEC2 United Health Group Inc Callable Note Cont 4/15/2026 1.150% Due 05/15/2026 30,000.00 Various 1.08% 30,097.10 30,071.13 88.53 4.62% 26,559.42 130.33 0.25% (3,511.71) A3 / A+ A 3.62 3.46 89236TJK2 Toyota Motor Credit Corp Note 1.125% Due 06/18/2026 120,000.00 06/15/2021 1.13% 119,947.20 119,960.79 87.51 4.84% 105,010.08 386.25 1.00% (14,950.71) A1 / A+ A+ 3.72 3.55 61747YET8 Morgan Stanley Callable Note Cont 7/17/2025 4.679% Due 07/17/2026 60,000.00 07/18/2022 4.68% 60,000.00 60,000.00 97.41 5.46% 58,448.52 553.68 0.56% (1,551.48) A1 / A- A 3.80 3.39 89114TZG0 Toronto-Dominion Bank Note 1.250% Due 09/10/2026 200,000.00 11/17/2021 1.70% 195,888.00 196,627.97 85.66 5.33% 171,320.40 145.83 1.62% (25,307.57) A1 / A AA- 3.95 3.75 931142ER0 Wal-Mart Stores Callable Note Cont 08/17/2026 1.050% Due 09/17/2026 30,000.00 09/08/2021 1.09% 29,943.30 29,955.07 87.29 4.59% 26,187.30 12.25 0.25% (3,767.77) Aa2 / AA AA 3.97 3.80 87612EBM7 Target Corp Callable Note Cont 12/15/2026 1.950% Due 01/15/2027 65,000.00 01/19/2022 1.99% 64,889.50 64,904.70 89.69 4.62% 58,300.52 267.58 0.55% (6,604.18) A2 / A A 4.30 4.02 808513BY0 Charles Schwab Corp Callable Note Cont 2/3/2027 2.450% Due 03/03/2027 45,000.00 03/01/2022 2.47% 44,951.40 44,957.04 89.78 5.06% 40,401.09 85.75 0.38% (4,555.95) A2 / A A 4.42 4.09 084664CZ2 Berkshire Hathaway Callable Note Cont 2/15/2027 2.300% Due 03/15/2027 130,000.00 03/07/2022 2.30% 129,975.30 129,978.01 91.05 4.54% 118,368.51 132.89 1.12% (11,609.50) Aa2 / AA A+ 4.46 4.15 023135CF1 Amazon.com Inc Callable Note Cont 3/13/2027 3.300% Due 04/13/2027 60,000.00 04/11/2022 3.35% 59,876.40 59,887.97 94.43 4.68% 56,656.20 924.00 0.54% (3,231.77) A1 / AA AA- 4.54 4.08 665859AW4 Northern Trust Company Callable Note Cont 4/10/2027 4.000% Due 05/10/2027 130,000.00 09/28/2022 4.70% 126,240.40 126,242.63 96.47 4.86% 125,412.30 2,036.67 1.20% (830.33) A2 / A+ A+ 4.61 4.08 91324PEG3 United Health Group Inc Callable Note Cont 4/15/2027 3.700% Due 05/15/2027 50,000.00 05/17/2022 3.69% 50,025.40 50,023.54 95.18 4.88% 47,589.15 673.20 0.46% (2,434.39) A3 / A+ A 4.62 4.12 TOTAL Corporate 2,175,000.00 2.26% 2,185,806.00 2,171,922.02 4.65% 2,050,824.81 12,975.62 19.51% (121,097.21) A1 / A+ A+ 2.46 2.30 Money Market Fund 31846V203 First American Govt Obligation Fund Class Y 14,719.98 Various 2.45% 14,719.98 14,719.98 1.00 2.45% 14,719.98 0.00 0.14% 0.00 Aaa / AAA AAA 0.00 0.00 TOTAL Money Market Fund 14,719.98 2.45% 14,719.98 14,719.98 2.45% 14,719.98 0.00 0.14% 0.00 Aaa / AAA Aaa 0.00 0.00 As of September 30, 2022 29 4.1.a Packet Pg. 149 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration Supranational 4581X0DV7 Inter-American Dev Bank Note 0.875% Due 04/20/2026 230,000.00 04/13/2021 0.97% 228,946.60 229,251.77 88.72 4.33% 204,053.70 900.03 1.94% (25,198.07) Aaa / AAA AAA 3.56 3.42 TOTAL Supranational 230,000.00 0.97% 228,946.60 229,251.77 4.33% 204,053.70 900.03 1.94% (25,198.07) Aaa / AAA Aaa 3.56 3.42 US Treasury 912828Y61 US Treasury Note 2.750% Due 07/31/2023 125,000.00 12/27/2018 2.59% 125,874.02 125,158.01 98.85 4.16% 123,564.50 579.14 1.17% (1,593.51) Aaa / AA+ AAA 0.83 0.81 912828W71 US Treasury Note 2.125% Due 03/31/2024 210,000.00 12/05/2019 1.63% 214,331.25 211,502.34 96.84 4.32% 203,371.98 12.26 1.92% (8,130.36) Aaa / AA+ AAA 1.50 1.45 912828Y87 US Treasury Note 1.750% Due 07/31/2024 220,000.00 01/17/2020 1.63% 221,160.16 220,469.54 95.61 4.27% 210,332.10 648.64 1.99% (10,137.44) Aaa / AA+ AAA 1.84 1.77 9128282U3 US Treasury Note 1.875% Due 08/31/2024 230,000.00 12/12/2019 1.76% 231,230.86 230,500.06 95.66 4.26% 220,009.26 369.30 2.08% (10,490.80) Aaa / AA+ AAA 1.92 1.85 912828YV6 US Treasury Note 1.500% Due 11/30/2024 230,000.00 12/12/2019 1.74% 227,421.48 228,875.63 94.37 4.25% 217,053.53 1,159.43 2.06% (11,822.10) Aaa / AA+ AAA 2.17 2.08 91282CDN8 US Treasury Note 1.000% Due 12/15/2024 185,000.00 12/22/2021 0.94% 185,310.74 185,230.20 93.23 4.25% 172,469.21 545.90 1.64% (12,760.99) Aaa / AA+ AAA 2.21 2.14 912828ZC7 US Treasury Note 1.125% Due 02/28/2025 400,000.00 03/24/2020 0.51% 412,046.88 405,893.00 92.89 4.25% 371,578.00 385.36 3.52% (34,315.00) Aaa / AA+ AAA 2.42 2.34 912828ZT0 US Treasury Note 0.250% Due 05/31/2025 230,000.00 06/04/2020 0.39% 228,373.83 229,131.10 89.97 4.27% 206,928.24 193.24 1.96% (22,202.86) Aaa / AA+ AAA 2.67 2.60 9128284Z0 US Treasury Note 2.750% Due 08/31/2025 155,000.00 06/24/2021 0.72% 167,950.98 164,026.70 95.91 4.26% 148,654.61 365.02 1.41% (15,372.09) Aaa / AA+ AAA 2.92 2.76 9128285C0 US Treasury Note 3.000% Due 09/30/2025 200,000.00 02/25/2022 1.87% 207,804.69 206,523.77 96.53 4.24% 193,062.40 16.48 1.83% (13,461.37) Aaa / AA+ AAA 3.00 2.83 91282CAZ4 US Treasury Note 0.375% Due 11/30/2025 240,000.00 12/15/2020 0.37% 240,018.75 240,011.98 88.68 4.23% 212,821.92 302.46 2.01% (27,190.06) Aaa / AA+ AAA 3.17 3.08 91282CBC4 US Treasury Note 0.375% Due 12/31/2025 250,000.00 01/28/2021 0.41% 249,541.02 249,696.82 88.44 4.22% 221,103.50 236.92 2.09% (28,593.32) Aaa / AA+ AAA 3.25 3.16 91282CBQ3 US Treasury Note 0.500% Due 02/28/2026 250,000.00 03/24/2021 0.82% 246,123.05 247,317.78 88.25 4.23% 220,634.75 107.04 2.09% (26,683.03) Aaa / AA+ AAA 3.42 3.32 91282CBT7 US Treasury Note 0.750% Due 03/31/2026 250,000.00 Various 0.86% 248,714.06 249,069.01 88.81 4.22% 222,021.50 5.15 2.10% (27,047.51) Aaa / AA+ AAA 3.50 3.39 As of September 30, 2022 30 4.1.a Packet Pg. 150 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Holdings Report City of San Jacinto -Account #10167 CUSIP Security Description Par Value/Units Purchase Date Book Yield Cost Value Book Value Mkt Price Mkt YTM Market Value Accrued Int. % of Port. Gain/Loss Moody/S&P Fitch Maturity Duration 91282CCP4 US Treasury Note 0.625% Due 07/31/2026 300,000.00 08/25/2021 0.82% 297,152.34 297,786.74 87.50 4.19% 262,488.30 315.90 2.48% (35,298.44) Aaa / AA+ AAA 3.84 3.71 9128282A7 US Treasury Note 1.500% Due 08/15/2026 150,000.00 09/23/2021 0.91% 154,230.47 153,349.32 90.47 4.19% 135,709.05 287.36 1.29% (17,640.27) Aaa / AA+ AAA 3.88 3.69 912828V98 US Treasury Note 2.250% Due 02/15/2027 130,000.00 03/29/2022 2.53% 128,334.38 128,507.20 92.48 4.15% 120,229.72 373.57 1.14% (8,277.48) Aaa / AA+ AAA 4.38 4.09 91282CEF4 US Treasury Note 2.500% Due 03/31/2027 225,000.00 05/25/2022 2.73% 222,626.95 222,798.56 93.47 4.10% 210,313.58 15.45 1.99% (12,484.98) Aaa / AA+ AAA 4.50 4.19 91282CET4 US Treasury Note 2.625% Due 05/31/2027 215,000.00 Various 3.36% 207,938.48 208,260.78 93.93 4.07% 201,940.47 1,896.67 1.93% (6,320.31) Aaa / AA+ AAA 4.67 4.29 TOTAL US Treasury 4,195,000.00 1.29% 4,216,184.39 4,204,108.54 4.22% 3,874,286.62 7,815.29 36.70% (329,821.92) Aaa / AA+ Aaa 2.94 2.82 TOTAL PORTFOLIO 11,245,784.10 1.50% 11,325,074.43 11,269,593.24 4.34% 10,542,293.56 36,569.51 100.00% (727,299.68) Aa1 / AA+ Aaa 2.48 2.26 TOTAL MARKET VALUE PLUS ACCRUALS 10,578,863.07 As of September 30, 2022 31 4.1.a Packet Pg. 151 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) SECTION |Section 4 |Transactions 32 4.1.a Packet Pg. 152 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Transaction Ledger City of San Jacinto -Account #10167 Transaction Type Settlement Date CUSIP Quantity Security Description Price Acq/Disp Yield Amount Interest Pur/Sold Total Amount Gain/Loss ACQUISITIONS Purchase 07/20/2022 47800AAC4 45,000.00 John Deere Owner Trust 2022-B A3 3.74% Due: 02/16/2027 99.990 3.77%44,995.70 0.00 44,995.70 0.00 Purchase 07/20/2022 61747YET8 60,000.00 Morgan Stanley Callable Note Cont 7/17/2025 4.679% Due: 07/17/2026 100.000 4.69%60,000.00 0.00 60,000.00 0.00 Purchase 08/31/2022 91282CET4 65,000.00 US Treasury Note 2.625% Due: 05/31/2027 97.051 3.30%63,083.01 428.89 63,511.90 0.00 Purchase 09/09/2022 931142EW9 30,000.00 Wal-Mart Stores Note 3.9% Due: 09/09/2025 99.930 3.92%29,979.00 0.00 29,979.00 0.00 Purchase 09/30/2022 665859AW4 130,000.00 Northern Trust Company Callable Note Cont 4/10/2027 4% Due: 05/10/2027 97.108 4.70%126,240.40 2,022.22 128,262.62 0.00 Subtotal 330,000.00 324,298.11 2,451.11 326,749.22 0.00 TOTAL ACQUISITIONS 330,000.00 324,298.11 2,451.11 326,749.22 0.00 DISPOSITIONS Sale 07/14/2022 3135G0W33 35,000.00 FNMA Note 1.375% Due: 09/06/2022 99.860 1.49%34,951.00 171.11 35,122.11 -43.00 Sale 07/20/2022 912828Y61 50,000.00 US Treasury Note 2.75% Due: 07/31/2023 99.621 2.59%49,810.55 645.72 50,456.27 -267.88 Sale 09/30/2022 06051GEU9 60,000.00 Bank of America Corp Note 3.3% Due: 01/11/2023 99.743 3.29%59,845.80 434.50 60,280.30 -156.17 Subtotal 145,000.00 144,607.35 1,251.33 145,858.68 -467.05 June 30, 2022 through September 30, 2022 As of September 30, 2022 33 4.1.a Packet Pg. 153 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Transaction Ledger City of San Jacinto -Account #10167 Transaction Type Settlement Date CUSIP Quantity Security Description Price Acq/Disp Yield Amount Interest Pur/Sold Total Amount Gain/Loss Maturity 09/06/2022 3135G0W33 50,000.00 FNMA Note 1.375% Due: 09/06/2022 100.000 50,000.00 0.00 50,000.00 0.00 Subtotal 50,000.00 50,000.00 0.00 50,000.00 0.00 TOTAL DISPOSITIONS 195,000.00 194,607.35 1,251.33 195,858.68 -467.05 June 30, 2022 through September 30, 2022 As of September 30, 2022 34 4.1.a Packet Pg. 154 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Important Disclosures 2022 Chandler Asset Management,Inc, An Independent Registered Investment Adviser. Information contained herein is confidential.Prices are provided by ICE Data Services Inc (“IDS”),an independent pricing source.In the event IDS does not provide a price or if the price provided is not reflective of fair market value, Chandler will obtain pricing from an alternative approved third party pricing source in accordance with our written valuation policy and procedures.Our valuation procedures are also disclosed in Item 5 of our Form ADV Part 2A. Performance results are presented gross-of-advisory fees and represent the client’s Total Return.The deduction of advisory fees lowers performance results.These results include the reinvestment of dividends and other earnings.Past performance may not be indicative of future results.Therefore,clients should not assume that future performance of any specific investment or investment strategy will be profitable or equal to past performance levels.All investment strategies have the potential for profit or loss.Economic factors,market conditions or changes in investment strategies, contributions or withdrawals may materially alter the performance and results of your portfolio. Index returns assume reinvestment of all distributions.Historical performance results for investment indexes generally do not reflect the deduction of transaction and/or custodial charges or the deduction of an investment management fee,the incurrence of which would have the effect of decreasing historical performance results.It is not possible to invest directly in an index. Source ICE Data Indices,LLC ("ICE"),used with permission. 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This report is provided for informational purposes only and should not be construed as a specific investment or legal advice.The information contained herein was obtained from sources believed to be reliable as of the date of publication,but may become outdated or superseded at any time without notice.Any opinions or views expressed are based on current market conditions and are subject to change.This report may contain forecasts and forward-looking statements which are inherently limited and should not be relied upon as indicator of future results.Past performance is not indicative of future results.This report is not intended to constitute an offer,solicitation,recommendation or advice regarding any securities or investment strategy and should not be regarded by recipients as a substitute for the exercise of their own judgment. Fixed income investments are subject to interest, credit and market risk.Interest rate risk:the value of fixed income investments will decline as interest rates rise.Credit risk:the possibility that the borrower may not be able to repay interest and principal.Low rated bonds generally have to pay higher interest rates to attract investors willing to take on greater risk.Market risk:the bond market in general could decline due to economic conditions,especially during periods of rising interest rates. Ratings information have been provided by Moody’s,S&P and Fitch through data feeds we believe to be reliable as of the date of this statement, however we cannot guarantee its accuracy. Security level ratings for U.S.Agency issued mortgage-backed securities (“MBS”)reflect the issuer rating because the securities themselves are not rated.The issuing U.S.Agency guarantees the full and timely payment of both principal and interest and carries a AA+/Aaa/AAA by S&P,Moody’s and Fitch respectively. As of September 30, 2022 35 4.1.a Packet Pg. 155 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Benchmark Disclosures San Jacinto 1-5 Yr AAA-A US Corp & Govt Blend* TThe ICE BofA 1-3 AAA-A Year US Corporate &Government Index tracks the performance of US dollar denominated investment grade debt publicly issued in the US domestic market,including US Treasury, US agency,foreign government, supranational,and corporate securities.Qualifying securities must be rated AAA through A3 (based on an average of Moody’s,S&P and Fitch).In addition, qualifying securities must have at least one year remaining term to final maturity and less than three years remaining term to final maturity,at least 18 months to final maturity at point of issuance,a fixed coupon schedule,and a minimum amount outstanding of $1 billion for US Treasuries and $250 million for all other securities.The ICE BofA 1-5 Year AAA-A US Corporate &Government Index tracks the performance of US dollar denominated investment grade debt publicly issued in the US domestic market,including US Treasury,US agency,foreign government, supranational,and corporate securities. Qualifying securities must be rated AAA through A3 (based on an average of Moody’s,S&P and Fitch).In addition, qualifying securities must have at least one year remaining term to final maturity and less than five years remaining term to final maturity, at least 18 months to final maturity at point of issuance,a fixed coupon schedule,and a minimum amount outstanding of $1 billion for US Treasuries and $250 million for all other securities. San Jacinto 1-5 Yr US Tsy & Agy Blended Index* The ICE BofA 1-5 Year US Treasury &Agency Index tracks the performance of US dollar denominated US Treasury and nonsubordinated US agency debt issued in the US domestic market.Qualifying securities must have an investment grade rating (based on an average of Moody’s,S&P and Fitch).Qualifying securities must have at least one year remaining term to final maturity and less than five years remaining term to final maturity,at least 18 months to maturity at time of issuance,a fixed coupon schedule,and a minimum amount outstanding of $1 billion for sovereigns and $250 million for agencies.The ICE BofA 1-3 Year US Treasury Index tracks the performance of US dollar-denominated sovereign debt publicly issued by the US government in its domestic market.Qualifying securities must have at least one year remaining term to final maturity and less than three years remaining term to final maturity,a fixed coupon schedule,and a minimum amount outstanding of $1 billion.Qualifying securities must haveat least 18 months to final maturity at the time of issuance. As of September 30, 2022 36 4.1.a Packet Pg. 156 Attachment: Investment Report - 09-30-22 (Investment Portfolio Review with Advisors) Annual Portfolio Review For the Period Ended September 30, 2022 City of San Jacinto November 1, 2022 4.1.b Packet Pg. 157 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 2021 © Economic Update 2 4.1.b Packet Pg. 158 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 2021 © Domestic Growth: U.S. Economy Contracts for Two Consecutive Quarters 3Source: Bureau of Economic Analysis, Bloomberg U.S. GDP Contracted by 0.60% in the Second Quarter The back-to-back declines in Q1 and Q2 Gross Domestic Product (GDP) sparked a heated debate in economic and policy circles regarding whether the U.S. economy is already in recession. 3.2 2.8 1.9 -5.1 -31.2 33.8 4.5 6.3 6.7 2.3 6.9 -1.6 -0.6 -40 -30 -20 -10 0 10 20 30 40 50 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 Consumer Spending Investment Net Exports Government Spending Real GDP 4.1.b Packet Pg. 159 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 2021 © Domestic Growth: Bloomberg Consensus Forecasts Portend Slower Growth Ahead 4Source: Bloomberg U.S. GDP is Forecast to Stall in Coming Quarters as Tighter Monetary and Fiscal Conditions Weigh on Activity The U.S. is forecast to slow notably in coming quarters as the lagged effects of tighter monetary policy and fiscal headwinds weigh on economic activity. 1.90 0.60 0.00 0.20 0.80 1.20 1.50 -0.25 0.25 0.75 1.25 1.75 2.25 Sep-22Dec-22Mar-23Jun-23Sep-23Dec-23Mar-24Bloomberg Cocensus GDP Growth Forecasts Annualized QoQ %4.1.b Packet Pg. 160 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 2021 © Purchasing Manager Indices: Manufacturing Slows as Serviced Hold Up 5Source: Institute for Supply Management, Bloomberg Purchasing Managers Report that Service Sector Activity Continue to Expand as Manufacturing Slows Manufacturing activity fell to its lowest level in 2 years in September as falling new orders portend slowing demand. Activity in the service sector continues to expand as spending shifts from goods to services. 50.9 56.7 40 45 50 55 60 65 70 Sep-16Mar-17Sep-17Mar-18Sep-18Mar-19Sep-19Mar-20Sep-20Mar-21Sep-21Mar-22Sep-22ISM Manufacturing PMI SA ISM Services PMI SA Expansion Level Expansion ↑ Contraction ↓ 4.1.b Packet Pg. 161 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 2021 © Leading Indicators: Flashing Recessionary Warning Signal 6Source: Conference Board, Bloomberg The Conference Board’s U.S. Leading Index has Been Negative for 6 Consecutive Months Historical declines in the Leading Economic Indicators lasting 4 Months or Longer Have Foreshadowed Periods of Economic Downturn and Recession. 0 2 4 6 8 10 12 14 16 Sep-62Sep-67Sep-72Sep-77Sep-82Sep-87Sep-92Sep-97Sep-02Sep-07Sep-12Sep-17Sep-22# Consecutive Monthly DeclinesConference Board US Leading IndexRecession Danger Zone: 4 Months 4.1.b Packet Pg. 162 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Despite a growing chorus that the economy may already be in recession following back -to-back quarterly declines in GDP, the U.S. labor market continues to plow forward with steady job gains. Labor Markets: The Job Market Remains a Bright Spot Amidst Growing Uncertainty 7Source: Bureau of Labor Statistics Job Gains Have Remained Steady as Economy Shows Signs of Cooling 919 647 333 -115 520 710 704 263 447 557 689 517 424 677 647 588 504 714 398 368 386 293 526 315 -250 0 250 500 750 1,000 1,250 Sep-20Nov-20Jan-21Mar-21May-21Jul-21Sep-21Nov-21Jan-22Mar-22May-22Jul-22Sep-22Nonfarm Payrolls Total MoM Net Change SA (000s) Survey Estimate 4 per. Mov. Avg. (Nonfarm Payrolls Total MoM Net Change SA (000s)) Public Trust Advisors 2022 © 4.1.b Packet Pg. 163 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Continued job gains will keep the unemployment rate subdued in the near term. Fed officials have acknowledged the need for higher unemployment to combat inflation. Labor Markets: Unemployment Fell in September to Match its Lowest Level in 50 Years 8Source: Bureau of Labor Statistics Continued Tight Labor Market Conditions Remain the Primary Focus of Fed Officials Intent on Taming Inflation 14.7 3.5 0 2 4 6 8 10 12 14 16 Sep-50Sep-53Sep-56Sep-59Sep-62Sep-65Sep-68Sep-71Sep-74Sep-77Sep-80Sep-83Sep-86Sep-89Sep-92Sep-95Sep-98Sep-01Sep-04Sep-07Sep-10Sep-13Sep-16Sep-19Sep-22Recession U-3 US Unemployment Rate (%)18 per. Mov. Avg. (U-3 US Unemployment Rate (%)) Public Trust Advisors 2022 © 4.1.b Packet Pg. 164 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) One of Fed Chair Powell’s preferred metrics, the ratio of job openings per unemployed person, fell to 1.67 from 1.97 in July in a sign that tighter monetary conditions are beginning to weigh on businesses. Labor Markets: JOLT Data Shows Early Signs of Cooling Labor Conditions 9Source: Bureau of Labor Statistics The Ratio of Job Openings to Unemployed Persons Cooled Sharply in August 1.97 1.67 0.0 0.5 1.0 1.5 2.0 2.5 Aug-00Aug-01Aug-02Aug-03Aug-04Aug-05Aug-06Aug-07Aug-08Aug-09Aug-10Aug-11Aug-12Aug-13Aug-14Aug-15Aug-16Aug-17Aug-18Aug-19Aug-20Aug-21Aug-22Ratio of Job Openings Per Unemployed Person Public Trust Advisors 2022 © 4.1.b Packet Pg. 165 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Inflation: Persistent Inflation Remains a Clear and Present Danger 10 Despite Moderating Headline Inflation, Accelerating Core Inflation Reflects a Broadening of Price Pressures Source: Bureau of Labor Statistics, Bureau of Economic Analysis, Bloomberg 0.6 9.1 8.2 6.5 6.6 5.4 4.9 0 1 2 3 4 5 6 7 8 9 10 Mar-17Jun-17Sep-17Dec-17Mar-18Jun-18Sep-18Dec-18Mar-19Jun-19Sep-19Dec-19Mar-20Jun-20Sep-20Dec-20Mar-21Jun-21Sep-21Dec-21Mar-22Jun-22Sep-22US Core CPI MoM US CPI YOY Index US Core CPI YoY US PCE Core YoY The surprise acceleration in September’s Core CPI report suggests that inflation is broadening and reinforces expectations for continued and prolonged higher interest rate policy form the Fed. Public Trust Advisors 2022 © 4.1.b Packet Pg. 166 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Average Hourly Earnings: Wage Pressures Fail to Keep Pace with Inflation 13 Inflation Continues to Accelerate at a Faster Pace than Wages The tightest labor market conditions in decades is fueling rapid wage growth for millions of American workers, but painfully high and persistent inflation is eroding those gains on a real basis. The Federal Reserve is concerned that continued rapid wage gains feed spiral into further price increases. Source: Bureau of Labor Statistics, Bloomberg 5.0 -3.0 -6 -4 -2 0 2 4 6 8 10 Jan-20Feb-20Mar-20Apr-20May-20Jun-20Jul-20Aug-20Sep-20Oct-20Nov-20Dec-20Jan-21Feb-21Mar-21Apr-21May-21Jun-21Jul-21Aug-21Sep-21Oct-21Nov-21Dec-21Jan-22Feb-22Mar-22Apr-22May-22Jun-22Jul-22Aug-22Sep-22US Average Hourly Earnings Percentage Change YoY US Real Average Hourly Earnings Percentage Change YoY Public Trust Advisors 2022 © 4.1.b Packet Pg. 167 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Consumer Sentiment: Consumer’s Sentiment Has Rebounded From Record Lows 11 Measures of Consumer Sentiment Have Rebounded but Remain Under Pressure as Rising Prices Weigh on Optimism The University of Michigan’s Consumer Sentiment Index remains exceptionally low by historical standards underscoring the risk of recession as consumer’s grapple with the highest inflation in 40 years. Source: University of Michigan, Bloomberg 59.8 40 50 60 70 80 90 100 110 120 Oct-78Oct-80Oct-82Oct-84Oct-86Oct-88Oct-90Oct-92Oct-94Oct-96Oct-98Oct-00Oct-02Oct-04Oct-06Oct-08Oct-10Oct-12Oct-14Oct-16Oct-18Oct-20Oct-22University of Michigan Consumer Sentiment Index Public Trust Advisors 2022 © 4.1.b Packet Pg. 168 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Business Sentiment: Confidence Has Fallen in the Face of Higher Rates and Inflation 12 The National Federation of Independent Business Optimism Index Remains Subdued Amidst a Challenging Backdrop Subdued business optimism in the face of higher interest rates and persistent inflation could weigh on hiring and capital spending decisions further depressing the growth outlook. Source: National Federation of Independent Businesses, Bloomberg 91.8 75 80 85 90 95 100 105 110 Oct-78Oct-80Oct-82Oct-84Oct-86Oct-88Oct-90Oct-92Oct-94Oct-96Oct-98Oct-00Oct-02Oct-04Oct-06Oct-08Oct-10Oct-12Oct-14Oct-16Oct-18Oct-20Oct-22NFIB Small Business Optimism Index Public Trust Advisors 2022 © 4.1.b Packet Pg. 169 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Company Price Plans: Inflation Relief in Sight? 14 Company Price Plans versus Median (Sticky) Inflation The declining share of companies planning price increases hint price pressures may be rolling over and measures of sticky inflation may be near a peak and poised to decelerate over the next 6 -9 months. Source: NFIB, Cleveland Fed, Bloomberg -10 0 10 20 30 40 50 60 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 9.0 Sep-90Sep-92Sep-94Sep-96Sep-98Sep-00Sep-02Sep-04Sep-06Sep-08Sep-10Sep-12Sep-14Sep-16Sep-18Sep-20Sep-22 Federal Reserve Bank of Cleveland Median CPI YoY (LHS) NFIB Price Plans Next 3 Months (RHS) Public Trust Advisors 2022 © 4.1.b Packet Pg. 170 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Financial Conditions: Stresses Grow in the U.S. Money, Bond, and Equity Markets 15 Bloomberg's Financial Conditions Index Continues to Tighten as the Fed Raises Rates and Drains Liquidity The Fed’s goal is relatively simple: actively tighten financial conditions as measured by treasury yields, credit spreads, stock prices, and volatility measures in order to slow inflation. Source: Bloomberg -1.35 -6.00 -5.00 -4.00 -3.00 -2.00 -1.00 0.00 1.00 2.00 Sep-90Sep-92Sep-94Sep-96Sep-98Sep-00Sep-02Sep-04Sep-06Sep-08Sep-10Sep-12Sep-14Sep-16Sep-18Sep-20Sep-22# Standard Deviations from Normalrecession Bloomberg US Financial Conditions Index Public Trust Advisors 2022 © 4.1.b Packet Pg. 171 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Monetary Policy: Federal Reserve Intends to Make Monetary Policy Highly Restrictive 16Source: Federal Reserve, Bloomberg The Fed has raised the Federal Funds rate by 300 basis points (3.00%) year-to-date and has accelerated the pace of balance sheet run-off to $90 billion per month. Federal Reserve is Poised to Raise Rates Further While Reducing the Balance Sheet to Tighten Financial Conditions 3.25 $0 $1 $2 $3 $4 $5 $6 $7 $8 $9 $10 0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 Sep-17Mar-18Sep-18Mar-19Sep-19Mar-20Sep-20Mar-21Sep-21Mar-22Sep-22Federal Reserve Total Assets (RHS)Federal Funds Target Rate: Upper Bound (LHS) Public Trust Advisors 2022 © 4.1.b Packet Pg. 172 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) “While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses. These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.” -Jerome Powell, August 26th Monetary Policy: Fed Funds Futures Continue to Trend Higher and Flatter 17Source: Bloomberg The Fed Funds Future Market Continues to Price in a More Aggressive Rate Path and Higher for Longer Rate Scenario 0.67 1.11 1.37 1.41 1.45 1.52 1.57 1.61 1.60 1.59 1.59 3.19 3.38 3.45 3.49 3.44 3.33 3.22 3.12 3.02 2.94 2.87 3.86 4.48 4.82 4.90 4.89 4.85 4.79 4.72 4.62 4.52 4.46 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 2.00 2.50 3.00 3.50 4.00 4.50 5.00 5.50 Nov-22Dec-22Jan-23Feb-23Mar-23Apr-23May-23Jun-23Jul-23Aug-23Sep-23Oct-23Nov-23Dec-23Jan-24Change (RHS)Implied Rate (06/30)Implied Rate (10/18/21) Public Trust Advisors 2022 © 4.1.b Packet Pg. 173 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Treasury Market: Yields Surge and the Curve Inverts as the Fed Raises Rates Aggressively 18Source: Bloomberg Treasury Yields Surged as Market Participants Brace for Higher Yields and a Smaller Fed Balance Sheet The Fed’s delayed and aggressive rate hikes have pushed Treasury yields dramatically higher and inverted the yield curve as market participants price in growing expectations of a policy error and rate overshoot. 188 169 148 143 120 108 100 4.37 4.47 4.44 4.44 4.24 4.15 4.02 2.49 2.78 2.96 3.01 3.04 3.07 3.021 0 20 40 60 80 100 120 140 160 180 200 2.00 2.50 3.00 3.50 4.00 4.50 5.00 6M 1Y 2Y 3Y 5Y 7Y 10Y Change in BPs (RHS)10/18/2022 6/30/2022 Public Trust Advisors 2022 © 4.1.b Packet Pg. 174 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Growing market concerns that the Fed may overtighten monetary policy have made longer duration assets comparatively more attractive this inverting the yield curve. Treasury Market: Yield Curve Inversions Flashes Recessionary Warning Signal 19Source: Bloomberg The Inversion of the Spread Between 2 and 10-Year Treasury Yields Sounds Ominous Recession Alarm -39 -300 -200 -100 0 100 200 300 400 Oct-78Oct-80Oct-82Oct-84Oct-86Oct-88Oct-90Oct-92Oct-94Oct-96Oct-98Oct-00Oct-02Oct-04Oct-06Oct-08Oct-10Oct-12Oct-14Oct-16Oct-18Oct-20Oct-22Basis Points Recession 2's VS 10's Spread (BPs) Public Trust Advisors 2022 © 4.1.b Packet Pg. 175 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) With the Fed raising rates aggressively amidst an already slowing global economy and volatile geopolitical backdrop, the likelihood of a soft landing grows smaller by the day. Past Fed Tightening Cycles: The Fed Has a History of Overshooting Policy Tightening 20Source: Bloomberg, Public Trust Advisors There Have Been 13 Primary Fed Tightening Cycles Since the 1950’s with 10 Ending in Recession and 3 Soft Landings 0.00 5.00 10.00 15.00 20.00 Oct-54Oct-56Oct-58Oct-60Oct-62Oct-64Oct-66Oct-68Oct-70Oct-72Oct-74Oct-76Oct-78Oct-80Oct-82Oct-84Oct-86Oct-88Oct-90Oct-92Oct-94Oct-96Oct-98Oct-00Oct-02Oct-04Oct-06Oct-08Oct-10Oct-12Oct-14Oct-16Oct-18Oct-20Oct-22recession Federal Funds Target Rate: Upper Bound 6 7 8 9 10 11 12 13 ?1 2 3 4 5 Public Trust Advisors 2022 © 4.1.b Packet Pg. 176 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Update: Summary Characteristics 21 4.1.b Packet Pg. 177 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 3 10/01/2021 to 09/30/2022 City of San Jacinto Portfolio Overview 09/30/21 09/30/22 Duration 2.609 2.500 Years to Effective Maturity 2.646 2.609 Years to Final Maturity 2.664 2.614 Coupon Rate 0.956 1.300 Book Yield 0.763 1.284 Market Yield 0.500 4.235 Benchmark Yield 0.284 4.296 Portfolio Summary Asset Allocation Portfolio Characteristics Summary 09/30/21 09/30/22 Historical Cost $11,301,922.59 $11,347,571.27 Book Value 11,269,003.01 11,315,982.09 Accrued Interest 18,799.53 28,461.40 Net Pending Transactions 0.18 124.93 Book Value Plus Accrued $11,287,802.72 $11,344,568.42 Net Unrealized Gain/Loss 31,179.67 (779,356.28) Market Value Plus Accrued $11,318,982.39 $10,565,212.14 Period Income Income Interest Income $116,832.12 Net Amortization/Accretion Income (9,181.12) Net Realized Gain/Loss (49,843.59) Other Income/Expenses (0.01) Net Income $57,807.40 Income Summary Detail may not add to total due to rounding. Executive Summary 4.1.b Packet Pg. 178 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Maturity Distribution by Security Type Portfolio Overview Issuer Value United States 63.30% Federal Home Loan Mortgage Corporation 7.58% Federal National Mortgage Association 6.41% Amazon.com, Inc.4.02% Caterpillar Inc.2.58% Toyota Motor Corporation 2.45% Microsoft Corporation 2.22% PACCAR Inc 2.18% Walmart Inc.2.14% Farm Credit System 1.97% Top Ten Holdings Maturity Distribution by Type Security Distribution 0-3 Months 3-6 Months 6-9 Months 9-12 Months 1-2 Years 2-3 Years 3-4 Years 4-5 Years 5+ Years Portfolio Total CASH $124.93 ----------------$124.93 CORP 460,799.82 980,355.00 390,733.71 1,831,888.53 FED INST (GSE)248,074.28 784,385.55 858,494.40 1,890,954.22 MMFUND 154,731.42 154,731.42 US GOV 1,584,766.70 1,264,317.86 1,968,461.53 1,869,966.94 6,687,513.04 TOTAL $154,856.35 --$708,874.10 --$3,349,507.25 $2,513,545.97 $1,968,461.53 $1,869,966.94 --$10,565,212.14 • Maturity Distribution 4.1.b Packet Pg. 179 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Portfolio Overview S&P Rating Distribution Moody’s Rating Distribution Allocation by Standard and Poor’s Rating Allocation by Moody’s Rating S&P Rating Distribution Sep 30, 2022 Ending Balance Portfolio Allocation Short Term Rating Distribution A-1+$0.00 0.00% A-1 A-2 Total Short Term Ratings $0.00 0.00% Long Term Rating Distribution AAA $659,909.87 6.25% AA $9,003,094.70 85.21% A $902,207.57 8.54% Below A Not Rated Total Long Term Ratings $10,565,212.14 100.00% Portfolio Total $10,565,212.14 100.00% Moody's Rating Distribution Sep 30, 2022 Ending Balance Portfolio Allocation Short Term Rating Distribution P-1 $0.00 0.00% P-2 Total Short Term Ratings $0.00 0.00% Long Term Rating Distribution Aaa $8,968,200.43 84.88% Aa $269,596.68 2.55% A $1,327,415.04 12.56% Below A Not Rated Total Long Term Ratings $10,565,212.14 100.00% Portfolio Total $10,565,212.14 100.00% • Rating Distribution 4.1.b Packet Pg. 180 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Market Value Basis Security Distribution Asset Balance by Security Type Security Distribution Sep 30, 2021 Ending Balance Sep 30, 2021 Portfolio Allocation Sep 30, 2022 Ending Balance Sep 30, 2022 Portfolio Allocation Change in Allocation Book Yield Cash $0.18 0.00%$124.93 0.00%0.00%0.00% U.S. Treasury Notes $5,500,114.23 48.59%$6,687,513.04 63.30%14.71%1.33% Federal Instrumentality (GSE)4,131,908.37 36.50%1,890,954.22 17.90% (18.61%)1.01% Money Market Funds $29,148.74 0.26%$154,731.42 1.46%1.21%2.46% Corporate Notes 1,657,810.87 14.65%1,831,888.53 17.34%2.69%1.32% Portfolio Total $11,318,982.39 100.00%$10,565,212.14 100.00%1.28% Portfolio Overview • Security Distribution – Market Value 4.1.b Packet Pg. 181 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Compliance 22 4.1.b Packet Pg. 182 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Compliance: September 30, 2022 Portfolio Compliance 4.1.b Packet Pg. 183 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Performance 4.1.b Packet Pg. 184 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Performance: Historical Performance Source: ICE BofA Fixed Income Indices, PTA City of San Jacinto Historical Total Return: Account Inception - October 31, 2019 Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Total Return Performance City of San Jacinto Portfolio 0.34%1.04%2.19%4.49%3.50% ICE BofAML 1-3 Year Treasury Index 0.33%1.03%2.15%4.54%3.37% Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Total Return Performance City of San Jacinto Portfolio 1.78%1.41%1.21% ICE BofAML 1-3 Year Treasury Index 1.66%1.33%1.12% Notes: Account Inception Date: 12/1/2012. Annualized total return performance presented for investment periods longer than one year. Index Return information obtained from Bloomberg. 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% 5.00% Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Portfolio and Benchmark Total Return City of San Jacinto Portfolio ICE BofAML 1-3 Year Treasury Index 4.1.b Packet Pg. 185 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Performance: Current Benchmark Performance Source: ICE BofA Fixed Income Indices, PTA Notes: Strategy Inception Date: 2/1/2020 Annualized total return performance presented for investment periods longer than one year. Index Return information obtained from Bloomberg. City of San Jacinto Total Return: February 2020 - September 30, 2022 Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Total Return Performance City of San Jacinto Portfolio -1.66%-2.17%-2.95%-6.65%-6.01% ICE BofAML 1-5 Year Tsy/Agy Index -1.70%-2.27%-3.07%-6.78%-6.13% Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Total Return Performance City of San Jacinto Portfolio NA NA -1.38% ICE BofAML 1-5 Year Tsy/Agy Index NA NA -1.54% -8.00% -7.00% -6.00% -5.00% -4.00% -3.00% -2.00% -1.00% 0.00% Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Portfolio and Benchmark Total Return City of San Jacinto Portfolio ICE BofAML 1-5 Year Tsy/Agy Index 4.1.b Packet Pg. 186 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Performance: Total Account Performance Source: ICE BofA Fixed Income Indices, PTA City of San Jacinto Total Return: Account Inception - September 30, 2022 Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Total Return Performance City of San Jacinto Portfolio -1.66%-2.17%-2.95%-6.65%-6.01% Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Total Return Performance City of San Jacinto Portfolio -0.77%0.44%0.58% Notes: Account Inception Date: 12/1/2012. Annualized total return performance presented for investment periods longer than one year. Index Return information obtained from Bloomberg. -8.00% -7.00% -6.00% -5.00% -4.00% -3.00% -2.00% -1.00% 0.00% 1.00% Trailing Month Periodic Trailing 3-Months Periodic Trailing 6-Months Periodic Trailing 12-Months Periodic Year to Date Periodic Trailing 3 Years Annualized Trailing 5 Years Annualized Since Inception * Annualized Portfolio Total Return City of San Jacinto Portfolio 4.1.b Packet Pg. 187 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Portfolio Details: Holdings as of September 30, 2022 28 4.1.b Packet Pg. 188 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Description IdentifierCoupon Effective Maturity Final Maturity Duration Trade Date Settle Date Par Value Original Cost Book Value Market Value Market Price MV + Accrued Accrued Balance Net Unrealized Gain/Loss % of Market Value Callable Next Call Date Book Yield YTM YTC S&P Moody's CASH 0.00% Receivable CCYUSD 0.00% 09/30/22 09/30/22 0.00 -- --124.93 $124.93 $124.93 $124.93 1.00 $124.93 $0.00 $0.00 0.00%N -- 0.00% 0.00% 0.00% AAA Aaa CASH TOTAL 09/30/22 09/30/22 0.00 -- --124.93 $124.93 $124.93 $124.93 1.00 $124.93 $0.00 $0.00 0.00%N -- 0.00% 0.00% 0.00% AAA Aaa MMFUND 0.00% FIRST AMER:GVT OBLG Y 31846V203 2.49% 09/30/22 09/30/22 0.00 -- --154,731.42 $154,731.42 $154,731.42 $154,731.42 1.00 $154,731.42 $0.00 $0.00 1.46%N -- 2.46% -- -- AAAm Aaa MMFUND TOTAL 09/30/22 09/30/22 0.00 -- --154,731.42 $154,731.42 $154,731.42 $154,731.42 1.00 $154,731.42 $0.00 $0.00 1.46%N -- 2.46% -- -- AAAm Aaa US GOV 0.00% UNITED STATES TREASURY 912828V80 2.25% 01/31/24 01/31/24 1.29 12/12/19 12/17/19 95,000.00 $96,970.51 $95,651.86 $92,487.72 97.36 $92,847.85 $360.12 ($3,164.14)0.88%N -- 1.73% 4.31% -- AA+ Aaa UNITED STATES TREASURY 91282CBR1 0.25% 03/15/24 03/15/24 1.43 07/01/21 07/06/21 285,000.00 283,819.92 284,360.52 268,812.86 94.32 268,844.35 31.49 (15,547.66)2.54%N -- 0.40% 4.31% -- AA+ Aaa UNITED STATES TREASURY 912828W71 2.12% 03/31/24 03/31/24 1.45 06/09/22 06/10/22 395,000.00 390,679.69 391,408.99 382,533.01 96.84 382,556.07 23.06 (8,875.98)3.62%N -- 2.75% 4.32% -- AA+ Aaa UNITED STATES TREASURY 91282CCC3 0.25% 05/15/24 05/15/24 1.59 06/03/21 06/07/21 220,000.00 219,510.16 219,728.92 206,155.40 93.71 206,363.14 207.74 (13,573.52)1.95%N -- 0.33% 4.30% -- AA+ Aaa UNITED STATES TREASURY 912828YE4 1.25% 08/31/24 08/31/24 1.86 -- --670,000.00 670,270.31 670,211.72 633,438.10 94.54 634,155.30 717.20 (36,773.62)6.00%N -- 1.23% 4.24% -- AA+ Aaa UNITED STATES TREASURY 912828YY0 1.75% 12/31/24 12/31/24 2.16 03/02/20 03/04/20 85,000.00 88,453.12 86,626.94 80,574.05 94.79 80,949.97 375.92 (6,052.89)0.77%N -- 0.89% 4.20% -- AA+ Aaa UNITED STATES TREASURY 912828ZC7 1.12% 02/28/25 02/28/25 2.34 -- --295,000.00 302,591.21 299,036.55 274,038.78 92.89 274,322.98 284.20 (24,997.78)2.60%N -- 0.55% 4.25% -- AA+ Aaa UNITED STATES TREASURY 912828ZL7 0.38% 04/30/25 04/30/25 2.52 02/24/21 02/26/21 155,000.00 154,461.13 154,665.56 140,432.48 90.60 140,675.72 243.24 (14,233.08)1.33%N -- 0.46% 4.25% -- AA+ Aaa Portfolio Holdings Supporting Reports 4.1.b Packet Pg. 189 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Description IdentifierCoupon Effective Maturity Final Maturity Duration Trade Date Settle Date Par Value Original Cost Book Value Market Value Market Price MV + Accrued Accrued Balance Net Unrealized Gain/Loss % of Market Value Callable Next Call Date Book Yield YTM YTC S&P Moody's UNITED STATES TREASURY 912828ZT0 0.25% 05/31/25 05/31/25 2.60 -- --425,000.00 423,066.41 423,837.21 382,367.40 89.97 382,724.47 357.07 (41,469.81)3.62%N -- 0.35% 4.27% -- AA+ Aaa UNITED STATES TREASURY 912828ZW3 0.25% 06/30/25 06/30/25 2.68 11/02/20 11/04/20 255,000.00 253,894.34 254,345.37 228,942.06 89.78 229,103.17 161.11 (25,403.31)2.17%N -- 0.34% 4.22% -- AA+ Aaa UNITED STATES TREASURY 91282CAB7 0.25% 07/31/25 07/31/25 2.77 10/28/21 10/29/21 175,000.00 170,358.40 171,485.15 156,467.85 89.41 156,541.56 73.71 (15,017.30)1.48%N -- 0.97% 4.26% -- AA+ Aaa UNITED STATES TREASURY 91282CAT8 0.25% 10/31/25 10/31/25 3.01 01/06/21 01/08/21 190,000.00 188,567.58 189,079.03 168,290.98 88.57 168,489.76 198.78 (20,788.05)1.59%N -- 0.41% 4.24% -- AA+ Aaa UNITED STATES TREASURY 91282CAZ4 0.38% 11/30/25 11/30/25 3.08 02/04/21 02/05/21 205,000.00 204,375.39 204,588.24 181,785.39 88.68 182,043.74 258.35 (22,802.85)1.72%N -- 0.44% 4.23% -- AA+ Aaa UNITED STATES TREASURY 91282CBC4 0.38% 12/31/25 12/31/25 3.16 02/24/21 02/26/21 155,000.00 153,395.51 153,919.13 137,084.17 88.44 137,231.06 146.89 (16,834.96)1.30%N -- 0.59% 4.22% -- AA+ Aaa UNITED STATES TREASURY 91282CBH3 0.38% 01/31/26 01/31/26 3.24 03/29/21 03/31/21 125,000.00 122,236.33 123,084.70 110,117.25 88.09 110,196.22 78.97 (12,967.45)1.04%N -- 0.84% 4.24% -- AA+ Aaa UNITED STATES TREASURY 91282CBQ3 0.50% 02/28/26 02/28/26 3.32 10/28/21 10/29/21 335,000.00 326,520.31 328,291.44 295,650.56 88.25 295,794.00 143.44 (32,640.87)2.80%N -- 1.10% 4.23% -- AA+ Aaa UNITED STATES TREASURY 91282CBT7 0.75% 03/31/26 03/31/26 3.39 05/06/21 05/10/21 300,000.00 299,566.41 299,688.54 266,425.80 88.81 266,431.98 6.18 (33,262.74)2.52%N -- 0.78% 4.22% -- AA+ Aaa UNITED STATES TREASURY 91282CBW0 0.75% 04/30/26 04/30/26 3.45 08/05/21 08/09/21 235,000.00 235,688.48 235,524.11 208,186.03 88.59 208,923.60 737.57 (27,338.08)1.98%N -- 0.69% 4.21% -- AA+ Aaa UNITED STATES TREASURY 91282CCF6 0.75% 05/31/26 05/31/26 3.54 06/03/21 06/07/21 220,000.00 219,028.91 219,281.82 194,347.56 88.34 194,902.07 554.51 (24,934.26)1.84%N -- 0.84% 4.22% -- AA+ Aaa UNITED STATES TREASURY 91282CCJ8 0.88% 06/30/26 06/30/26 3.61 10/04/21 10/06/21 125,000.00 124,804.69 124,844.96 110,708.00 88.57 110,984.41 276.41 (14,136.96)1.05%N -- 0.91% 4.20% -- AA+ Aaa UNITED STATES TREASURY 91282CCP4 0.62% 07/31/26 07/31/26 3.71 09/01/21 09/03/21 335,000.00 332,579.10 333,102.43 293,111.94 87.50 293,464.69 352.75 (39,990.50)2.78%N -- 0.78% 4.19% -- AA+ Aaa Portfolio Holdings Supporting Reports 4.1.b Packet Pg. 190 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Description IdentifierCoupon Effective Maturity Final Maturity Duration Trade Date Settle Date Par Value Original Cost Book Value Market Value Market Price MV + Accrued Accrued Balance Net Unrealized Gain/Loss % of Market Value Callable Next Call Date Book Yield YTM YTC S&P Moody's UNITED STATES TREASURY 91282CCZ2 0.88% 09/30/26 09/30/26 3.85 10/28/21 10/29/21 415,000.00 409,050.59 410,141.33 365,248.56 88.01 365,258.53 9.98 (44,892.77)3.46%N -- 1.18% 4.16% -- AA+ Aaa UNITED STATES TREASURY 912828YX2 1.75% 12/31/26 12/31/26 4.00 04/27/22 04/28/22 250,000.00 238,701.17 239,678.33 227,177.75 90.87 228,283.39 1,105.64 (12,500.58)2.16%N -- 2.79% 4.11% -- AA+ Aaa UNITED STATES TREASURY 91282CEC1 1.88% 02/28/27 02/28/27 4.16 03/09/22 03/11/22 335,000.00 335,157.03 335,140.90 305,255.68 91.12 305,793.58 537.90 (29,885.22)2.89%N -- 1.87% 4.09% -- AA+ Aaa UNITED STATES TREASURY 91282CEF4 2.50% 03/31/27 03/31/27 4.19 04/27/22 04/28/22 80,000.00 78,971.88 79,056.29 74,778.16 93.47 74,783.65 5.49 (4,278.13)0.71%N -- 2.78% 4.10% -- AA+ Aaa UNITED STATES TREASURY 91282CEN7 2.75% 04/30/27 04/30/27 4.19 08/29/22 08/30/22 225,000.00 219,541.99 219,639.15 212,458.05 94.43 215,047.38 2,589.33 (7,181.10)2.04%N -- 3.31% 4.10% -- AA+ Aaa UNITED STATES TREASURY 91282CET4 2.62% 05/31/27 05/31/27 4.29 06/09/22 06/10/22 200,000.00 196,085.94 196,313.34 187,851.60 93.93 189,615.94 1,764.34 (8,461.74)1.79%N -- 3.05% 4.07% -- AA+ Aaa UNITED STATES TREASURY 91282CEW7 3.25% 06/30/27 06/30/27 4.31 07/07/22 07/08/22 135,000.00 136,181.25 136,130.41 130,185.36 96.43 131,294.16 1,108.80 (5,945.05)1.24%N -- 3.06% 4.08% -- AA+ Aaa UNITED STATES TREASURY 9128282R0 2.25% 08/15/27 08/15/27 4.53 08/29/22 08/30/22 390,000.00 371,429.30 371,731.95 358,769.58 91.99 359,890.30 1,120.72 (12,962.37)3.41%N -- 3.30% 4.08% -- AA+ Aaa US GOV TOTAL 11/29/25 11/29/25 3.03 -- --7,310,000.00 $7,245,957.06 $7,250,594.91 $6,673,682.12 91.39 $6,687,513.04 $13,830.91 ($576,912.78)63.30%N -- 1.33% 4.21% -- AA+ Aaa GSE 0.00% FEDERAL NATIONAL MORTGAGE ASSOCIATION 3135G06H1 0.25% 11/27/23 11/27/23 1.13 11/23/20 11/25/20 320,000.00 $319,635.20 $319,859.46 $305,769.22 95.55 $306,044.77 $275.56 ($14,090.25)2.90%N -- 0.29% 4.22% -- AA+ Aaa FEDERAL FARM CREDIT BANKS FUNDING CORP 3133EMRZ7 0.25% 02/26/24 02/26/24 1.37 02/22/21 02/26/21 220,000.00 219,920.80 219,962.91 208,110.61 94.60 208,164.08 53.47 (11,852.30)1.97%N -- 0.26% 4.25% -- AA+ Aaa FEDERAL HOME LOAN MORTGAGE CORP 3137EAEP0 1.50% 02/12/25 02/12/25 2.28 02/13/20 02/14/20 300,000.00 299,769.00 299,888.46 281,808.90 93.94 282,421.40 612.50 (18,079.56)2.67%N -- 1.52% 4.22% -- AA+ Aaa Portfolio Holdings Supporting Reports 4.1.b Packet Pg. 191 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Description IdentifierCoupon Effective Maturity Final Maturity Duration Trade Date Settle Date Par Value Original Cost Book Value Market Value Market Price MV + Accrued Accrued Balance Net Unrealized Gain/Loss % of Market Value Callable Next Call Date Book Yield YTM YTC S&P Moody's FEDERAL HOME LOAN BANKS 3130AJHU6 0.50% 04/14/25 04/14/25 2.46 04/15/20 04/16/20 225,000.00 223,884.00 224,429.27 204,262.81 90.78 204,784.68 521.88 (20,166.46)1.94%N -- 0.60% 4.37% -- AA+ Aaa FEDERAL NATIONAL MORTGAGE ASSOCIATION 3135G05X7 0.38% 08/25/25 08/25/25 2.83 08/25/20 08/27/20 415,000.00 413,057.80 413,866.97 371,132.69 89.43 371,288.32 155.62 (42,734.28)3.51%N -- 0.47% 4.29% -- AA+ Aaa GSE TOTAL 11/13/24 11/13/24 2.06 -- --1,480,000.00 $1,476,266.80 $1,478,007.07 $1,371,084.22 92.71 $1,372,703.24 $1,619.03 ($106,922.85)12.99%N -- 0.63% 4.27% -- AA+ Aaa GSE MBS 0.00% FHMS K-033 A2 3137B4WB8 3.06% 06/08/23 07/25/23 0.67 12/12/19 12/17/19 250,000.00 $258,544.92 $251,334.84 $247,436.78 98.97 $248,074.28 $637.50 ($3,898.06)2.35%Y -- 1.99% -- -- AA+ Aaa FHMS K-725 A2 US3137BWWD24 3.00% 12/27/23 01/25/24 1.19 12/12/19 12/17/19 274,442.79 283,276.41 276,889.55 269,490.14 98.20 270,176.70 686.56 (7,399.42)2.56%Y -- 2.12% -- -- AAA Aaa GSE MBS TOTAL 09/21/23 10/29/23 0.94 12/12/19 12/17/19 524,442.79 $541,821.33 $528,224.39 $516,926.91 98.57 $518,250.98 $1,324.06 ($11,297.48)4.91%Y -- 2.06% -- -- AAA Aaa CORP 0.00% MICROSOFT CORP 594918AT1 2.38% 05/01/23 05/01/23 0.57 04/28/20 04/30/20 235,000.00 $246,484.45 $236,404.52 $232,551.30 98.96 $234,876.82 $2,325.52 ($3,853.22)2.22%Y 02/01/23 0.58% 4.19% 5.55% AAA Aaa WALMART INC 931142EK5 3.40% 06/26/23 06/26/23 0.71 04/29/20 05/01/20 225,000.00 243,666.00 228,994.26 223,904.25 99.51 225,923.00 2,018.75 (5,090.01)2.14%Y 05/26/23 0.66% 4.07% 4.16% AA Aa2 PEPSICO INC 713448FB9 0.40% 10/07/23 10/07/23 1.00 10/06/20 10/07/20 85,000.00 84,951.55 84,983.52 81,790.40 96.22 81,954.73 164.33 (3,193.12)0.78%N -- 0.42% 4.22% -- A+ A1 CATERPILLAR FINANCIAL SERVICES CORP 14913R2S5 0.95% 01/10/24 01/10/24 1.24 01/03/22 01/10/22 110,000.00 109,982.40 109,988.75 105,369.59 95.79 105,604.72 235.12 (4,619.16)1.00%N -- 0.96% 4.37% -- A A2 AMAZON.COM INC 023135BW5 0.45% 05/12/24 05/12/24 1.57 05/11/21 05/12/21 145,000.00 144,788.30 144,885.71 135,959.22 93.76 136,211.16 251.94 (8,926.49)1.29%N -- 0.50% 4.49% -- AA A1 PACCAR FINANCIAL CORP 69371RR81 3.15% 06/13/24 06/13/24 1.62 06/06/22 06/13/22 140,000.00 139,967.80 139,972.53 136,620.58 97.59 137,943.58 1,323.00 (3,351.95)1.31%N -- 3.16% 4.64% -- A+ A1 Portfolio Holdings Supporting Reports 4.1.b Packet Pg. 192 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Public Trust Advisors 10/01/2021 to 09/30/2022 City of San Jacinto Description IdentifierCoupon Effective Maturity Final Maturity Duration Trade Date Settle Date Par Value Original Cost Book Value Market Value Market Price MV + Accrued Accrued Balance Net Unrealized Gain/Loss % of Market Value Callable Next Call Date Book Yield YTM YTC S&P Moody's PACCAR FINANCIAL CORP 69371RR40 0.50% 08/09/24 08/09/24 1.81 08/03/21 08/09/21 100,000.00 99,946.00 99,966.50 92,705.46 92.71 92,777.68 72.22 (7,261.04)0.88%N -- 0.52% 4.64% -- A+ A1 CATERPILLAR FINANCIAL SERVICES CORP 14913R2P1 0.60% 09/13/24 09/13/24 1.90 09/08/21 09/14/21 180,000.00 179,755.20 179,840.18 166,683.47 92.60 166,737.47 54.00 (13,156.70)1.58%N -- 0.65% 4.60% -- A A2 TOYOTA MOTOR CREDIT CORP 89236TJN6 0.62% 09/13/24 09/13/24 1.90 09/08/21 09/13/21 280,000.00 279,868.40 279,914.16 259,038.15 92.51 259,125.65 87.50 (20,876.01)2.45%N -- 0.64% 4.68% -- A+ A1 AMAZON.COM INC 023135CE4 3.00% 04/13/25 04/13/25 2.37 04/11/22 04/13/22 295,000.00 294,530.95 294,601.26 284,866.30 96.56 288,996.30 4,130.00 (9,734.96)2.74%N -- 3.06% 4.45% -- AA A1 HOME DEPOT INC 437076CM2 2.70% 04/15/25 04/15/25 2.38 03/24/22 03/28/22 60,000.00 59,895.00 59,912.38 57,240.24 95.40 58,063.74 823.50 (2,672.15)0.55%Y 03/15/25 2.76% 4.64% 4.70% A A2 COLGATE-PALMOLIVE CO 194162AM5 3.10% 08/15/25 08/15/25 2.70 08/01/22 08/09/22 45,000.00 44,958.60 44,960.54 43,472.18 96.60 43,673.68 201.50 (1,488.37)0.41%N -- 3.13% 4.37% -- AA- Aa3 CORP TOTAL 05/18/24 05/18/24 1.56 -- --1,900,000.00 $1,928,794.65 $1,904,424.31 $1,820,201.14 95.88 $1,831,888.53 $11,687.39 ($84,223.17)17.34%-- 1.32% 4.43% 4.85% AA- A1 PORTFOLIO TOTAL 05/10/25 05/12/25 2.50 -- --11,369,299.14 $11,347,696.20 $11,316,107.02 $10,536,750.75 91.37 $10,565,212.14 $28,461.40 ($779,356.28)100.00%-- 1.28% 4.26% 4.85% AA Aa1 Portfolio Holdings Supporting Reports 4.1.b Packet Pg. 193 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors) Disclosures This presentation is for informational purposes only.The information contained herein has been obtained from sources that we believe to be reliable,but its accuracy and completeness are not guaranteed.The materials in the attached are opinions of Public Trust Advisors,LLC and should not be construed as investment advice.Many factors affect performance including changes in market conditions and interest rates and in response to other economic,political,or financial developments.Performance comparisons will be affected by changes in interest rates. Investing involves risk including the possible loss of principal.The presentation is not a recommendation to buy,sell,implement,or change any securities or investment strategy,function,or process.Any financial and/or investment decision should be made only after considerable research,consideration,and involvement with an experienced professional engaged for the specific purpose.All comments and discussion presented are purely based on opinion and assumptions,not fact.These assumptions may or may not be correct based on foreseen and unforeseen events.All calculations and results presented and are for discussion purposes only and should not be used for making and calculations and/or decisions.Past performance is not an indication of future performance.Any financial and/or investment decision may incur losses. The investment advisor providing these services is Public Trust Advisors,LLC,an investment adviser registered with the U.S.Securities and Exchange Commission (SEC)under the Investment Advisers Act of 1940,as amended.Registration with the SEC does not imply a certain level of skill or training.Public Trust is required to maintain a written disclosure brochure of our background and business experience.If you would like to receive a copy of our current disclosure brochure,privacy policy,or code of ethics please contact us. There is no guarantee that investment strategies will achieve the desired results under all market conditions,and each investor should evaluate its ability to invest long-term,especially during periods of a market downturn.This information may contain statements,estimates,or projections that constitute “forward-looking statements”as defined under U.S.federal and other jurisdictions’securities laws.Any such forward looking statements are inherently speculative and are based on currently available information,operating plans,and projections about future events and trends.As such,they are subject to numerous risks and uncertainties. Public Trust Advisors 717 17th Street,Suite 1850 Denver,Colorado 80202 Public Trust Advisors 2022 © 4.1.b Packet Pg. 194 Attachment: Annual Portfolio Review_2022 (Investment Portfolio Review with Advisors)