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COUNCIL - AGENDA ITEM - 09/18/2018 - PUBLIC HEARING AND RESOLUTION 2018-082 APPROVING T
Agenda Item 12 Item # 12 Page 1 AGENDA ITEM SUMMARY September 18, 2018 City Council STAFF Josh Birks, Economic Health Director Jeff Mihelich, Deputy City Manager John Duval, Legal SUBJECT Public Hearing and Resolution 2018-082 Approving the Consolidated Service Plan for Waterfield Metropolitan District Nos. 1-3. EXECUTIVE SUMMARY The purpose of this item is to consider a Service Plan for the Waterfield Metro District Nos. 1 through 3 (the “Metro Districts”). Thrive Home Builders has submitted a service plan for the Metro Districts to support a proposed development of approximately 500 homes on property generally located at the northwest corner of Vine Drive and Timberline Road. The project will include 50 lots dedicated for affordable housing construction. In addition, the project will deliver all units as US Department of Energy Certified Zero Energy Ready and 10 percent of homes with rooftop solar. Each of the Metro Districts is proposed to have a Mill Levy Cap of 50.00 mills to support the project. City Council conducted a public hearing on this Service Plan at its September 4, 2018 meeting and after receiving testimony and other evidence, continued the public hearing to this September 18, 2018 meeting. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BACKGROUND / DISCUSSION Thrive Home Builders (“Thrive”) is evaluating a significant project in Fort Collins, generally located at the northwest corner of Vine Drive and Timberline Road. (Attachment 1) The project would construct approximately 500 homes in a new urbanist layout-alley loaded and walkable design. The project is evaluating the ability to deliver up to 50 affordable homes as well as constructing all 500 homes as U.S. Department of Energy Certified Zero Energy Ready homes. Thrive is a Colorado grown company that has operated in the metro-Denver area for the past 20 years. Thrive is committed to building healthy, efficient, and local homes. They achieve this goal by: • Healthy – All homes are constructed to the Environmental Protection Agency’s Indoor airPLUS program standards, include active radon ventilation systems, using advanced moisture management practices to reduce the likelihood of mold, and use low Volatile Organic Compound (“VOC”) products. • Efficient – All homes are constructed to the U.S. Department of Energy Zero Energy Ready Home standard, achieve Energy Star Certified status, and include a RESNET HERS score – an independent energy rating that validates energy efficiency level. Agenda Item 12 Item # 12 Page 2 • Local – Locally-sourced products are used when available – an example is blue-stained beetle kill pine. Thrive also builds affordable homes. Thrive has been building affordable homes, meeting the Denver Inclusionary Housing guidelines through a deed restriction, for the past 12 years at the Stapleton Airport Redevelopment. Thrive has built over 380 affordable homes in the Stapleton project. In addition, they have constructed approximately 500 for-sale homes targeted at 80 percent of Area Median Income (“AMI”) at Belle Creek. In both projects, these homes deliver the same Zero Energy Ready features as Thrive uses in market rate housing, including trademark double walls, the ability to add solar panels, and other zero energy ready features. Project Overview Thrive is evaluating a project to construct approximately 498 homes on 71 acres (net of the school site; 93 acres total) at the northwest corner of Vine Drive and Timberline Road. (Attachment 1) The project, called Waterfield, will follow Thrive’s commitment to healthy, efficient, and local home construction, including all their normal standards and include raw water irrigation, comply with water sense standards, and re-plat the project to provide urban design and density, alleys, and walkable features. Service Plan Revisions Since September 4, 2018 On September 4, 2018 City Council voted unanimously to postpone consideration of the proposed Consolidated Service Plan for Waterfield Metropolitan District Nos. 1-3 (the Service Plan). Council had several concerns with the Service Plan as presented on September 4, 2018. The following changes have been made to the service plan in response to these concerns: • Further Council Approval Required – No Debt, Debt Mill Levy, or Fees to pay debt may be issued or collected until City Council approves an intergovernmental agreement and/or development agreement securing the Public Benefits (see revisions to Section IV.B(1-3)). • Operating Mill cannot Exceed 10.000 Mills – Revisions removed the portion of Section IX.B.3 which previously stated that when a majority of the Board is composed of End Users then at the board’s discretion of the board the Operating Mill may be increased up to 50.000 mills. If the Board desires to increase the Operating Mill such increase would require a Service Plan Amendment approved by City Council. • City may Dissolve a District for Inaction – Revisions to Section XVI now empower the City, at its option, to require the dissolution of the Districts if no intergovernmental agreement or development agreement to secure the delivery of the Public Benefits has been approved by City Council within three years of Service Plan approval. • Enhanced Commitment Language – Significant revisions were made to Exhibit G, which describes the Public Benefits to be delivered by the Project. Additional details regarding these commitments is included in the Public Benefits section of this summary below. All other changes in the proposed Service Plan are either refinements in the spirit of the Model Service Plan, minor in nature, further changes for clarification, or to respond to Council’s requests for changes and clarification on September 4, 2018. A redline version of the Service Plan compared to the version submitted on September 4, 2018 is attached to provide clarity on these changes (Attachment 2). Council Follow-Up – Affordable Housing Council had several unanswered questions during the discussion of the Service Plan. Several of these questions deal with affordable housing. Generally, these questions dealt with the tension between increasing the supply of affordable housing units in Fort Collins versus the concerns over added cost burden to households by increasing property taxes with a Metro District. What is the current Area Median Income (AMI) as calculated by the United States Department of Urban Development (HUD)? Agenda Item 12 Item # 12 Page 3 Currently, HUD calculated the AMI for a four-person household at $85,100 in Fort Collins, see Table 1 below. The City’s current definition of affordable housing requires that units be priced so that a household earning 80 percent of AMI can cover the monthly cost of ownership. The current 80 percent AMI income is $68,100 for a four-person household. Table 1 Area Median Income, 4-Person Household, 2018 Percent AMI Area Median Income (AMI) HUD Classification 100% $ 85,100 Moderate Income 80% $ 68,100 Low Income 60% $ 51,060 Low Income 50% $ 42,550 Very Low Income 30% $ 25,550 Extremely Low Income Source: HUD Based on current AMI levels what would be the maximum sales price for Affordable Homes? Using standard industry assumptions regarding homeowner’s insurance costs, property tax costs and homeowner’s association dues or metro district taxes the maximum sales price has been calculated for three- person households and four-person households, see Table 2. The result is maximum sales prices ranging between $278,000 and $312,000 assuming a four percent down payment under the Federal Housing Authority loan program and a five percent interest rate. The Project anticipates providing at least 50 residential units priced within this range. The calculations below are based on conservative assumptions of Property Taxes, including Metro District property taxes. The real cost of Metro District taxes to household in a $280,000 home will be $84 a month and regular property taxes would be $153 per month for a total property tax cost of $237 per month roughly half of the amount used in the calculations below. Agenda Item 12 Item # 12 Page 4 Table 2 Estimated Maximum Sales Price by Household Size at 80 percent AMI, 2018 3 Person 4 Person 80% AMI $ 61,300 $ 68,100 Monthly Income $ 5,110 $ 5,680 Available for Housing (38%) $ 1,942 $ 2,158 Property Taxes (.072%) $ 200 $ 230 Metro Taxes/HOA Fees ($200/mo) $ 200 $ 200 Insurance (.038%) $ 110 $ 120 Monthly Mortgage Payment $ 1,432 $ 1,608 Loan Amount $ 266,800 $ 299,500 Down Payment $ 11,100 $ 12,500 Total Purchase Price $ 277,900 $ 312,000 Household Item How might Affordable Housing be delivered within a Metro District? Council discussed a concern about how a Metro District can deliver affordable housing. In general, there are several methods for delivery affordable housing that might be employed by a developer. The concern is how to deliver affordable housing without adding additional property tax burden to the purchaser. One way to understand this concern is to review how affordable housing sales prices get set according to the City’s policy. There are three guiding principles to the policy: 1. Target AMI – Targets 80 percent AMI or below; 2. Affordability Period – Target is a minimum of 20-years of affordability; and 3. Income Available for Housing Cost – Limited to 38 percent of income. Following these principles, calculating a sales price that complies would require that added costs from Metro District property taxes be included within the 38 percent of income aspect of the policy. Therefore, the Affordable Housing sales price in a Metro District will be lower than outside a district. The calculations in Table 2 above show how estimated metro district costs could impact the sales price. Another way to evaluate the tension between increasing the number of units versus increased cost is to consider the manners in which housing could be delivered: • Traditional Delivery – Existing affordable housing providers could construct units within the district using their traditional funding approaches. These units would need to be rented or sold at a price point that complies with the City’s policy. The monthly cost to the user would be no different within the district than outside the district. Therefore, the housing provider would need to identify and obtain additional subsidy to cover the resulting lower sales price for a unit that will cost the same inside and outside of a District. • Land Trust – A developer could elect to transfer or sell affordable housing lots to a Land Trust operating in the State or Region. The Land Trust, typically a non-profit, would then reduce the tax burden to the Agenda Item 12 Item # 12 Page 5 occupant by removing 25 to 30 percent of property value associated with land. In addition, a Land Trust would also have to price units following the same principles – meaning that the net cost to the occupant would be consistent inside and outside a district. • Land Bank – A developer could elect to sell a portion of their property to the City’s land bank program at a market or discounted rate. These units would need to be rented or sold at a price point that complies with the City’s policy. The monthly cost to the user would be no different within the district than outside the district. As stated, the above are some examples of how a developer might deliver affordable housing while minimizing the impacts of added Metro District property taxes. However, the above list is not exhaustive. The key take-away is there are several methods to deliver affordable housing in a Metro District that does not pass added cost onto the occupants. Council Follow-Up – Zero Energy Ready Homes City Council wanted to understand the impact of the developer’s commitment to construct all homes within the project to the Department of Energy Zero Energy Ready Home (ZERH) standard. What is a ZERH and how does it differ from existing City Code? The U.S. Department of Energy (DOE) defines a ZEHR as “a high-performance home which is so energy efficient, that a renewable energy system can offset all or most of its annual energy consumption.” Practically, a ZERH home meets all the requirements of a net zero energy home less the renewable energy system, DOE requirements include: • Certified Energy Star Version 3.0 or Version 3.1 • Envelope – Fenestration to meet or exceed Energy Star requirements. Ceiling, wall, floor and slab insulation to meet 2012 or 2015 IECC levels. • Duct systems shall be located within the homes thermal and air boundary. • Hot water systems shall meet EPA WaterSense Single Family New Home specs along with other specific provisions not noted here. • Lights & appliances – Appliances shall be Energy Star qualified and 80 percent of lighting shall be Energy Star qualified. All bath and ceiling fans are Energy Star qualified. • Home must be certified EPA Indoor airPlus. • Home must meet requirements of the DOE PV-Ready checklist. What is the energy, thermal, and cost savings of a ZERH compared to a code compliant home? Recent modeling efforts comparing a ZEHR to a code compliant baseline home have netted the following results: • Approximate kilowatt hour (kWh) saving per year estimated at 1,350 kWh; • Approximate Therms (th) saving per year estimated at 300 th; and • Total cost savings compared to a baseline home of approximately $450 per year This modelling assumes the following: • Baseline assumes 2015 IECC code with local amendments and gas thermal heating; • Assumes a 2,400 square foot home with 4 bedrooms, 2 bathrooms, and a full basement; and • Utility rates are the default rates. Agenda Item 12 Item # 12 Page 6 What is the estimated CO2 avoided from a ZERH compared to a code compliant home? Converting the above energy and thermal savings avoids approximately 3.0 metric tons of CO2 equivalency each year. Therefore, the proposed 498 housing units would avoid a collective 1,500 metric tons of CO2, which is equivalent to 300 passenger vehicles being removed from the road for a year or converting 50,000 incandescent bulbs to LED bulbs. What is the anticipated impact of 500 plus ZERHs on the Utility system and infrastructure? • ZERH home standards do not fundamentally change the panel size requirements for electric service or the distribution system designs to supply and receive energy to and from the homes. • If a ZERH leverages electrification of building heat and includes charging infrastructure for electric vehicles, the panel size requirements can increase based on National Electric Code (NEC) requirements. • The peak demands (flows in and out) of the home can increase as well, which can require up-sizing of the distribution system to supply and receive energy to and from the home. If you consider the home owner as a prosumer, it requires the necessary infrastructure to move the energy in and out of the home to accommodate the energy transactions. • Although peak demands can be partially managed with a distributed storage device, to allow for full active management of future integrations with the larger bulk electric systems, it is recommended to maintain or increase the physical infrastructure designs to support the long-term reliability and flexible operations of these homes and neighborhoods. Council Follow-Up – Present Value Calculations On September 4, 2018 City Council was presented an analysis of the present value of Metro District revenues generated from a hypothetical home in a Metro District. There were several requested adjustments to that analysis. A full revision of this analysis is presented in the staff presentation. Below, in Table X, is an example of how the analysis has been altered, including assumptions for price appreciation, and a comparison to the present value of the revenue over perpetuity. The difference between a 40 year present value analysis and a the perpetuity analysis is an increase of 17% or just over $4,000. Agenda Item 12 Item # 12 Page 7 Table 3 Present Value Analysis, $425,000 Home Value Item 40 Years Perpetuity Difference Median Sales Price $ 425,000 $ 425,000 $ - Typical Fort Collins Mills 90.828 90.828 Typical Fort Collins Property Tax Liability $ 2,779 $ 2,779 $ - Hypothetical Metro District Mills 50.000 50.000 Metro District Property Tax Liability $ 1,530 $ 1,530 $ - New Total Property Tax Liability $ 4,309 $ 4,309 $ - Percent Increase of Property Taxes 55% 55% Metro Mill Levy Propety Tax Maximum Value as Present Value $26,253 $30,600 ($4,347) Service Plan Overview The Service Plan calls for the creation of three Metro Districts to work collaboratively to deliver the proposed Waterfield Project. The phased development is anticipated to reach build out in 2026 with an estimated population of 1,145. A few highlights about the proposed Service Plan, include: • Assessed Value – Estimated to be approximately $19 million in 2028 (the first year of full value after build- out) • Aggregate Mill Levy – 50 mills, subject to Gallagher Adjustments • Debt Mill Levy – 40 mills, may not be levied until an approved development plan or intergovernmental agreement has been executed that delivers the pledged public benefits • Operating Mill Levy – 10 mills may not increase as previously allowed without Council approval • Maximum Debt Authorization – Anticipated to be $22,429,750 to cover a total of $43,981,050 in estimated costs. This debt maximum includes anticipated refundings. The outstanding debt balance is not anticipated to exceed $15,655,000 at any point during repayment • Regional Mill Levy – 5 mills, anticipated to be used to fund specific transportation and/or stormwater improvements Public Improvements The Service Plan anticipates using the Debt Mill Levy to support the issuance of bonds in the maximum amount of $22.4 million, with an anticipated outstanding balance peak of $15.7 million, to fund all or a portion of the following $37.3 million in public improvements (details available in Exhibits D and E of the Service Plan): • Site Preparation/Grading – Up to approximately $7.2 million in site preparation costs and grading associated with the proposed project Agenda Item 12 Item # 12 Page 8 • Roadway Improvements – Up to approximately $6.4 million to fund local residential streets, alleys, boulevards, and a major extension of Suniga, a 4-lane arterial that bisects the project (estimated roadway costs of $1.7 million) • Potable Waterline Improvements – Up to $1.7 million in costs to construct the 8-inch waterline infrastructure that will be the main potable water infrastructure for the project • Sanitary Sewer Improvements – Up to $3.2 million in costs associated with constructing the main sanitary sewer infrastructure for the project • Storm Drainage Improvements – Up to $1.9 million in costs to construct the main storm drainage system and infrastructure for the project (costs associated with grading ponds is included in the Site Preparation/Grading amount above) • Open Space, Parks and Trails – Up to $3.8 million in costs to construct primarily natural area open space and regional trails • Administrative, Design, Permitting and Contingency Costs – Up to $13 million in costs associated with administering, managing, surveying, engineering, inspecting, testing, planning, and permitting the construction of the public improvements along with approximately $6.2 million in contingency Of these $37.3 million in potential public improvement costs, the applicant has estimated that approximately $6.6 million of these costs are non-basic costs. Non-basic costs are assumed to be costs that are not typical for a development of the proposed project’s type and/or size. These costs are therefore considered extraordinary infrastructure costs. The estimated $6.6 million in non-basic costs combined with the value of the indirect public benefits described below represents the City’s enhanced value received from the proposed Service Plan. Public Benefits As required by the City’s recently adopted metro district policy (the Metro District Policy), the Service Plan will deliver several extraordinary development outcomes that support delivery of several public benefits. The benefits, their estimated value, and a description of the commitment language are described below (details available in Exhibit G of the Service Plan): • Zero Energy Ready – The applicant has agreed to construct all 498 homes in the proposed project in compliance with the Department of Energy’s Zero Energy Ready and Environmental Protection Agency’s Indoor airPlus standards – the estimated cost of delivering homes at these standards is $14 million • Net Zero Energy/Distributed Storage – The applicant has agreed to construction either 10 percent of the homes as Net Zero Energy (with Rooftop Solar) or distributed power storage equivalent to the consumption by 10 percent of homes at an estimated cost of $2.8 million • Multimodal Transportation Improvements – The applicant has agreed to deliver buffered bike lanes, wider than required sidewalks, and enhanced pedestrian crossings as part of the construction of the 4-lane arterial Suniga at an estimated cost of $212,000 • Smart Growth Management – The applicant has agreed to design and construct the project at the upper- end of the zoned density by following new urbanist principles, such as alley loading, smaller lot size, and increasing multi-family density at an estimated cost of $6.1 million • Walkability/Pedestrian Friendliness – The applicant has agreed to make trail enhancements along the wetlands and other portions of the project to facilitate connections to the regional trail system at an estimated cost of $2.1 million • Public Spaces – The applicant has agreed to construct a number of pocket parks, as well as mixed use open spaces throughout the project at an estimated cost of $1.7 million • Affordable Housing – The applicant has agreed to make 10 percent of the homes (approximately 50 lots) available for the construction of affordable homes targeted at 80 percent of area median income; affordability will be maintained for a minimum of 20 years – the anticipated sales price is approximately $280,000 – these homes will likely be constructed in partnership with either a land trust or similar entity – at an estimated cost of $3.3 million The applicant estimates that value of the above public benefits at approximately $30.8 million. Agenda Item 12 Item # 12 Page 9 Policy Comparison A comparison of the proposed use of Metro District revenues to the City’s current Metro District Policy is provided below in Table 4. For reference, two other proposed Metro Districts are provided for comparison – Montava and Water’s Edge. Table 4 Metro District Policy Comparison Waterfield Montava Water's Edge Policy Mill Levy Caps 50 Mills 60 Mills 50 Mills 50 Mills Basic Infrastructure Partially Partially Not Supported To enable public benefit Eminent Domain Will Comply Will Comply Will Comply Prohibited Debt Limitation Will Comply Will Comply Will Comply 100% of Capacity Dissolution Limit Will Comply Will Comply Will Comply 40 years (end user refunding exception) Citizen Control Will Comply Will Comply Will Comply As early as possible Multiple Districts Yes Yes Yes Projected over an extended period Commercial/ Residential Ratio 100% Residential Mixed Use Residential (Phase 1); Mixed Use (Phase 2) N/A Performance Assurances The proposed Service Plan prohibits the issuance of any debt or imposition of the debt mill levy or fees to pay debit unless and until the delivery of the Public Benefits area secured for each development phase of the project in a manner that is approved by City Council. This requirement can be satisfied by one or both of the following methods, as applicable: • Intergovernmental Agreement - For any of the Public Benefits to be provided by one or more of the Districts, each such District must enter into an intergovernmental agreement with the City agreeing to provide those Public Benefits as a legally enforceable multiple-fiscal year obligation of the District under TABOR or by securing performance of that obligation with a surety bond, letter of credit or other security acceptable to the City and all such intergovernmental agreements must be approved by the City Council by resolution; • Approved Development Plan - For any of the Public Benefits to be provided by one or more Developers of the Planned Development, each such Developer must enter into a development agreement with the City under the Developer’s applicable Approved Development Plan, which agreement must legally obligate the Developer to provide those Public Benefits before the City is required to issue building permits and/or certificates of occupancy for structures to be built under the Approved Development Plan for that phase of the Planned Development or to secure such obligations with a surety bond, letter of credit or other security acceptable to the City and all such development agreements must be approved by the City Council by resolution. Agenda Item 12 Item # 12 Page 10 Policy Evaluation and Triple Bottom Line The Metro District Policy supports the formation of a metro district regardless of development type when a district delivers extraordinary public benefits. The public benefits should be: (1) aligned with the goals and objectives of the City whether such extraordinary public benefits are provided by the metro district or by the entity developing the metro district because metro districts exist to provide public improvements; and (2) not be practically provided by the City or an existing public entity, within a reasonable time and on a comparable basis. The Service Plan for the Waterfield project delivers several proposed policy outcomes, as described in the attached matrix. (Attachment 3) Triple Bottom Line – Scan An interdisciplinary staff team met to prepare a Triple Bottom Line Scan of the proposed Service Plan. For the proposed project, the TBLs focused on the impact of the difference in residential units delivered in the community by supporting the proposed Metro Districts. This baseline was used as opposed to vacant or agricultural land because the property already has an underlying residential plat and zoning. Therefore, the future use of the property will not be vacant or agricultural but residential. Therefore, comparing the project to the current state (agricultural land) would be disingenuous to the anticipated future condition. The TBLs analysis found that in many ways the proposed residential construction enabled by the Metro Districts is no different from the residential development currently platted and planned for the property. However, there were a few notable differences – most significant is the anticipated energy and water savings from the standard of construction proposed and the inclusion of 50 affordable units. The results of the TBLs reflect this marginal difference between the baseline and the proposed project. (Attachment 4) The highlights are provided below: • Economic – Generally considered to have a neutral impact on economic conditions in the community with potential positive impacts on talent retention due to increased housing supply and cost of living because of affordable units. • Environmental – Generally considered to have a neutral impact on environmental conditions compared to the baseline condition with the potential to have positive impacts on Climate Action Goals due to energy and water conservation and renewables. • Social – Largely considered to have a neutral impact on social health conditions with some potential positive impact on affordable housing opportunities. Financial Assessment The Metro District Policy requires all applications for a metro district service plan submit a Financial Plan to the City for review. Economic & Planning Systems prepared an analysis of the Financial Plan submitted with the Service Plan for Waterfield. (Attachment 5) The analysis concluded: • The market values and absorption assumptions used in the public revenue estimates are reasonable. Based on historic permitted and future projections, the proposed buildout implies approximately a 9 percent capture rate, which EPS finds to be a reasonable target. • Verified the public revenue estimates. The relatively conservative market value and absorption assumptions used by the Developer help to ensure that the public revenue and debt targets are achievable. The Developer has identified a total of $30.8 million in public benefits within the project. EPS has estimated that $24.6 million of the improvements for Energy Conservation Investments, Multimodal Transportation (including Walkability and Pedestrian Friendliness), Public Spaces and Affordable Housing Subsidy appear to meet the City’s proposed metro district qualifications for extraordinary public investments. These benefits exceed the $15.7 million in infrastructure costs offset by the metro district revenues. • The Service Plan does not guarantee the delivery of public benefits. Public benefits will have to be vetted and guaranteed through additional approval steps for the project, including approval of the development plan. Agenda Item 12 Item # 12 Page 11 Basic Infrastructure vs. Public Benefit The Metro District Policy allows a metro districts to fund “basic infrastructure”, that which is typically expected to be provided by a developer (both in type and magnitude), when the inclusion of “basic” infrastructure offsets higher costs associated with extraordinary development outcomes that cannot directly be provided by a metro district (Defined in Exhibit A of the Metro District Policy, e.g., rooftop solar, affordable housing, etc.). The Developer has identified $30.8 million in public benefits, of which EPS has identified $24.6 million that directly deliver benefit aligned with the Metro District Policy. The remaining $6.4 million are less directly attributable to the Metro District Policy. The directly attributable public benefits at $24.6 million exceeds the developer’s request that the metro districts be permitted to finance $15.7 million in basic infrastructure costs. As a result, staff recommends approval of the Service Plan with the full requested Maximum Debt Authorization of $22.4 million anticipating that the actual outstanding debt amount will not exceed $15.7 million during the District’s operations. Estimated Property Taxes Table 5 shows the property tax estimates by proposed unit type from the existing tax mill and for the proposed Metro Districts. The average increased cost to a home owner is approximately $1,530 annually or $127 monthly. This amount will vary over time based on the underlying assessed value as determined by the County Assessor. Table 5 Property Tax Estimates Applicant Supplied Materials The applicant requesting consideration of the Service Plan has submitted several items for Council’s review. These items include: • Affordable Housing Calculations showing anticipated sales prices and unit distribution (Attachment 7); • Fort Collins HUD Income Limits (Attachment 8); • A letter from Thrive Homebuilders addressing several questions and concerns from the September 4, 2018 City Council Meeting (Attachment 9); • A letter from Sam Rashkin, Chief Architect, U.S. DOE Building Technologies Office describing the benefits of Zero Energy Ready Home Development in Fort Collins (Attachment 10); • An example of metro district homeowner disclosure requirements that Thrive includes in their home sales process (Attachment 11); Agenda Item 12 Item # 12 Page 12 • A commitment letter from Thrive Homebuilders to participate in NREL’s proposal entitled, “Artificial Intelligence-Driven Smart Community Control for Accelerating PV Adoption and Enhancing Grid Resilience” (Attachment 12); • A commitment letter from NREL for the same project (Attachment 13); and • The applicant’s presentation (Attachment 14) CITY FINANCIAL IMPACTS The proposed Service Plan will not have an impact on the City’s financials. The applicant has paid the fees required under the City’s previous metro district policy, which fees are designed to offset the cost of staff and outside consultant review. In addition, the proposed Service Plan includes a requirement that the following notice be included in all debt issued by the Metro Districts: “By acceptance of this instrument, the owner of this Debt agrees and consents to all of the limitations with respect to the payment of the principal and interest on this Debt contained herein, in the resolution of the District authorizing the issuance of this Debt and in the Service Plan of the District. This Debt is not and cannot be a Debt of the City of Fort Collins” BOARD / COMMISSION RECOMMENDATION • Unable to present to the Superboard meeting on September 6, 2018 as the agenda was too full; • Presented to Affordable Housing Board on September 6, 2018; • Unable to present to the Energy Board on September 13, 2018 as the agenda was too full; • Unable to present to the Air Quality Advisory Board on September 17, 2018 as the agenda was too full; ATTACHMENTS 1. Project Vicinity Map (PDF) 2. Consolidated Service Plan (Redline showing changes) (PDF) 3. Policy Evaluation Matrix (PDF) 4. TBL-S - Waterfield Metro District (PDF) 5. Market & Financial Analysis (PDF) 6. Combined Vicinity Map (PDF) 7. Applicant Supplied - Affordable Housing Calculation (PDF) 8. Applicant Supplied - Income Limits 2018 (PDF) 9. Applicant Supplied - Response to Council Concerns & Comments (PDF) 10. Applicant Supplied - Zero Energy Ready Home Benefits Letter (PDF) 11. Applicant Supplied Metro District Homeowner Disclosure Requirements (PDF) 12. Applicant Supplied - Thrive NREL Grant Commitment Letter (PDF) 13. Applicant Supplied - NREL Grant Commitment Letter(PDF) 14. Applicant Presentation (PDF) 15. Staff Presentation (PPTX) E VINE DR PROPOSED THRIVE - WATERFIELD METROPOLITAN DISTRICT N TIMBERLINE RD MOUNTAIN VISTA DR ADRIEL DR TURNBERRY RD INTERNATIONAL BLVD SYKES DR FORKS DR THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 1000 0 1000 Feet 1000 VICINITY MAP 1" = 1000' C Attachment 1 - Vicinity Map CONSOLIDATED SERVICE PLAN FOR WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 CITY OF FORT COLLINS, COLORADO Prepared by: White Bear Ankele Tanaka & Waldron, Professional Corporation 748 Whalers Way, Suite 210 Fort Collins, Colorado 80525 Submitted On: August 29, 2018 Approved On: September 418, 2018 ATTACHMENT 2 i Table of Contents INTRODUCTION ...........................................................................................................................1 Purpose and Intent ........................................................................................................................1 Need for Districts .........................................................................................................................1 Objective of the City regarding Districts’ Service Plan ...............................................................2 City Approvals .............................................................................................................................2 DEFINITIONS .................................................................................................................................2 BOUNDARIES AND LOCATION .................................................................................................5 DESCRIPTION OF PROJECT, PLANNED DEVELOPMENT, PUBLIC BENEFIT & ASSESSED VALUATION ..................................................................................... 5VALUATION ..........................................................................................................................................................6 Project and Planned Development ......................................................................... 5Development ......................................................................................................................................................6 Public Benefits .............................................................................................................................6 Assessed Valuation ...................................................................................................... 6Valuation ......................................................................................................................................................7 INCLUSION OF LAND IN THE SERVICE AREA ......................................................................7 DISTRICT GOVERNANCE ...........................................................................................................7 AUTHORIZED AND PROHIBITED POWERS ............................................................................7 Prohibited Improvements and Services and other Restrictions and Limitations .......................7 ......................................................................................................................................................8 Eminent Domain Restriction ..............................................................................................7 ..........................................................................................................................................................8 Fee Limitation ....................................................................................................................8 Operations and Maintenance ..............................................................................................8 Fire Protection Restriction .................................................................................................8 ..........................................................................................................................................................9 Public Safety Services Restriction .....................................................................................8 ..........................................................................................................................................................9 Grants from Governmental Agencies Restriction ..............................................................8 ..........................................................................................................................................................9 Golf Course Construction Restriction ..................................................................................9 Television Relay and Translation Restriction ....................................................................9 ii Sales and Use Tax Exemption Limitation .........................................................................9 ........................................................................................................................................................10 Sub-district Restriction ......................................................................................................9 ........................................................................................................................................................10 Initial Debt Limitation .......................................................................................................9 ........................................................................................................................................................10 Privately Placed Debt Limitation .......................................................................................9 ........................................................................................................................................................10 Special Assessments ..........................................................................................................10 PUBLIC IMPROVEMENTS AND ESTIMATED COSTS ..........................................................10 Development Standards .............................................................................................. 10Standards ....................................................................................................................................................11 Contracting .................................................................................................................................11 Land Acquisition and Conveyance ............................................................................................11 Equal Employment and Discrimination .....................................................................................11 Discrimination ............................................................................................................................12 FINANCIAL PLAN/PROPOSED DEBT .......................................................................... 11DEBT ........................................................................................................................................................12 Financial Plan ..................................................................................................................... 11Plan ....................................................................................................................................................12 Mill Levies .................................................................................................................................12 Aggregate Mill Levy Maximum ......................................................................................12 Regional Mill Levy Not Included in Other Mill Levies ..................................................12 ........................................................................................................................................................13 Operating Mill Levy ........................................................................................................12 ........................................................................................................................................................13 Gallagher Adjustments .....................................................................................................12 ........................................................................................................................................................13 Excessive Mill Levy Pledges ............................................................................................13 Refunding Debt ................................................................................................................13 Maximum Debt Authorization ..........................................................................................13 Maximum Voted Interest Rate and Underwriting Discount ....................................... 13Discount ....................................................................................................................................................14 iii Interest Rate and Underwriting Discount Certification ..............................................................14 Disclosure to Purchasers ............................................................................................................14 External Financial Advisor ............................................................................................ 14Advisor ....................................................................................................................................................15 Disclosure to Debt Purchasers .................................................................................. 14Purchasers ....................................................................................................................................................15 Security for Debt ........................................................................................................................15 TABOR Compliance ..................................................................................................................15 Districts’ Operating Costs ................................................................................................. 15Costs ....................................................................................................................................................16 Regional Improvements ......................................................................................... 15Improvements ........................................................................................................................................................16 Regional Mill Levy Authority .................................................................................... 15Authority ....................................................................................................................................................16 Regional Mill Levy Imposition ..................................................................................................16 City Notice Regarding Regional Improvements ........................................................................16 Regional Improvements Authorized Under Service Plan ..........................................................16 Expenditure of Regional Mill Levy Revenues ........................................................... 16Revenues ....................................................................................................................................................17 Intergovernmental Agreement .........................................................................................16 ........................................................................................................................................................17 No Intergovernmental Agreement ...................................................................................16 ........................................................................................................................................................17 Regional Mill Levy Term .................................................................................................. 16Term ....................................................................................................................................................17 Completion of Regional Improvements ............................................................. 16Improvements ....................................................................................................................................................17 City Authority to Require Imposition ........................................................................................17 Regional Mill Levy Not Included in Other Mill Levies .............................................................17 Gallagher Adjustment ................................................................................................................17 City Fees ........................................................................................................................................17 Bankruptcy Limitations .............................................................................................. 17Limitations ........................................................................................................................................................18 Annual Reports and Board Meetings .............................................................................. 17Meetings ........................................................................................................................................................18 iii General .......................................................................................................................................17 General .......................................................................................................................................18 Board Meetings ………………………………………………………………………………..1718 Report Requirements ..................................................................................................................18 Narrative ...........................................................................................................................18 Financial Statements .........................................................................................................18 Capital Expenditures ........................................................................................................18 ........................................................................................................................................................19 Financial Obligations ........................................................................................................18 ........................................................................................................................................................19 Other Information ............................................................................................................18 ........................................................................................................................................................19 Reporting of Significant Events ...................................................................................... 18Events ....................................................................................................................................................19 Failure to Submit ............................................................................................................ 19Submit ....................................................................................................................................................20 Service Plan Amendments ....................................................................................... 19Amendments ........................................................................................................................................................20 Material Modifications ............................................................................................ 19Modifications ........................................................................................................................................................20 Dissolution .....................................................................................................................................20 Sanctions ........................................................................................................................................20 Conclusion .....................................................................................................................................20 Sanctions ........................................................................................................................................21 Conclusion .....................................................................................................................................21 Resolution of Approval .................................................................................................. 21Approval ........................................................................................................................................................22 iv EXHIBIT EXHIBIT A-1 Legal Description of District No. 1 Boundaries EXHIBIT A-2 Legal Description of District No. 2 Boundaries EXHIBIT A-3 Legal Description of District No. 3 Boundaries EXHIBIT B-1 District No. 1 Boundary Map EXHIBIT B-2 District No. 2 Boundary Map EXHIBIT B-3 District No. 3 Boundary Map EXHIBIT C Vicinity Map EXHIBIT D Public Improvement Cost Estimates EXHIBIT E Public Improvements Maps EXHIBIT F Financial Plan EXHIBIT G Public Benefits EXHIBIT H Disclosure Notice 1 I. INTRODUCTION A. Purpose and Intent. The Districts, which are intended to be independent units of local government separate and distinct from the City, are governed by this Service Plan, the Special District Act and other applicable State law. Except as may otherwise be provided for by State law, City Code or this Service Plan, the Districts’ activities are subject to review and approval by the City Council only insofar as they are a material modification of this Service Plan under C.R.S. Section 32-1-207 of the Special District Act. It is intended that the Districts will provide all or part of the Public Improvements for the Project for the use and benefit of all anticipated inhabitants and taxpayers of the Districts. The primary purpose of the Districts will be to finance the construction of a portion of these Public Improvements by the issuance of Debt. It is also intended thatunder this Service Plan alsothat no District shall be authorized to issue any Debt, impose a Debt Mill Levy or impose any Fees for payment on Debt unless and until the delivery of the applicable Public Benefits described in Section IV.B of this Service Plan has been secured in accordance with Section IV.B of this Service Plan. It is further intended that this Service Plan requires the Districts to pay a portion of the cost of the Regional Improvements, as provided in Section X of this Service Plan, as part of ensuring that those privately-owned properties to be developed in the District that benefit from the Regional Improvements pay a reasonable share of the associated costs. The Districts are not intended to provide ongoing operations and maintenance services except as expressly authorized in this Service Plan. It is the intent of the Districts to dissolve upon payment or defeasance of all Debt incurred or upon a court determination that adequate provision has been made for the payment of all Debt, except that if the Districts are authorized in this Service Plan to perform continuing operating or maintenance functions, the Districts shall continue in existence for the sole purpose of providing such functions and shall retain only the powers necessary to impose and collect the taxes or Fees authorized in this Service Plan to pay for the costs of those functions. It is intended that the Districts shall strictly comply the provisions of this Service Plan and that the City may enforce any non-compliance with these provisions as provided in Section XVII of this Service Plan. B. Need for the Districts. There are currently no other governmental entities, including the City, located in the immediate vicinity of the Districts that consider it desirable, feasible or practical to undertake the planning, design, acquisition, construction, installation, relocation, redevelopment and financing of the Public Improvements needed for the Project. Formation of the Districts is therefore 2 necessary in order for the Public Improvements required for the Project to be provided in the most economic manner possible. C. Objective of the City Regarding Districts’ Service Plan. The City’s objective in approving this Service Plan is to authorize the Districts to provide for the planning, design, acquisition, construction, installation, relocation and redevelopment of the Public Improvements from the proceeds of Debt to be issued by the Districts., but in doing so, to also establish in this Service Plan the means by which both the Regional Improvements and the Public Benefits will be provided. Except as specifically provided in this Service Plan, all Debt is expected to be repaid by taxes and Fees imposed and collected for no longer than the Maximum Debt Mill Levy Imposition Term for residential properties, and at a tax mill levy no higher than the Maximum Debt Mill Levy. Fees imposed for the payment of Debt shall be due no later than upon the issuance of a building permit unless a majority of the Board which imposes such a Fee is composed of End Users as provided in Section VII.B.2. Debt which is issued within these parameters and, as further described in the Financial Plan, will insulate property owners from excessive tax and Fee burdens to support the servicing of the Debt and will result in a timely and reasonable discharge of the Debt. D. City Approvals. Any provision in this Service Plan requiring “City” or “City Council” approval or consent shall require the City Council’s prior written approval or consent exercised in its sole discretion. Any provision in this Service Plan requiring “City Manager” approval or consent shall require the City Manager’s prior written approval or consent exercised in the City Manager’s sole discretion. II. DEFINITIONS In this Service Plan, the following words, terms and phrases which appear in a capitalized format shall have the meaning indicated below, unless the context clearly requires otherwise: Aggregate Mill Levy: means the total mill levy resulting from adding a District’s Debt Mill Levy and Operating Mill Levy. A District’s Aggregate Mill Levy does not include any Regional Mill Levy that the District may levy. Aggregate Mill Levy Maximum: means the maximum number of combined mills that each District may each levy for their Debt Mill Levy and Operating Mill Levy, at a rate not to exceed the limitation set in Section IX.B.1 of this Service Plan. Approved Development Plan: means a City-approved development plan or other land-use application required by the City Code for identifying, among other things, public improvements necessary for facilitating the development of property within the Service Area, which plan shall include, without limitation, any development agreement required by the City Code. 3 Board or Boards: means the duly constituted board of directors of any of the Districts, or the boards of directors of all of the Districts, in the aggregate. Bond, Bonds or Debt: means bonds, notes or other multiple fiscal year financial obligations for the payment of which a District has promised to impose an ad valorem property tax mill levy, Fees or other legally available revenue. Such terms do not include contracts through which a District procures or provides services or tangible property. City: means the City of Fort Collins, Colorado, a home rule municipality. City Code: means collectively the City’s Municipal Charter, Municipal Code, Land Use Code and ordinances as all are now existing and hereafter amended. City Council: means the City Council of the City of Fort Collins, Colorado. City Manager: means the City Manager of the City of Fort Collins, Colorado. C.R.S.: means the Colorado Revised Statutes. Debt Mill Levy: means a property tax mill levy imposed on Taxable Property within a District for the purpose of paying Debt as authorized in this Service Plan, at a rate not to exceed the limitations set in Section IX.B. Developer: means a person or entity that is the owner of property or owner of contractual rights to property in the Service Area that intends to develop the property. District: means Waterfield Metropolitan District No. 1, Waterfield Metropolitan District No. 2 or Waterfield Metropolitan District No. 3, individually, each organized under and governed by this Service Plan. District No. 1 Boundaries: means the boundaries of the area legally described in Exhibit “A-1” attached hereto and incorporated by reference and as depicted in the District No. 1 Boundary Map. District No. 2 Boundaries: means the boundaries of the area legally described in Exhibit “A-2” attached hereto and incorporated by reference and as depicted in the District No. 2 Boundary Map. District No. 3 Boundaries: means the boundaries of the area legally described in Exhibit “A-3” attached hereto and incorporated by reference and as depicted in the District No. 3 Boundary Map. District No. 1 Boundary Map: means the map of the District No. 1 Boundaries attached hereto as Exhibit “B-1” and incorporated by reference. District No. 2 Boundary Map: means the map of the District No. 2 Boundaries attached hereto as Exhibit “B-2” and incorporated by reference. District No. 3 Boundary Map: means the map of the District No. 3 Boundaries attached hereto as Exhibit “B-3” and incorporated by reference. Districts: means Waterfield Metropolitan District No. 1, Waterfield Metropolitan District No. 2 and Waterfield Metropolitan District No. 3, collectively, organized under and governed by this Service Plan. 4 End User: means any owner, or tenant of any owner, of any property within the Districts, who is intended to become burdened by the imposition of ad valorem property taxes and/or Fees. By way of illustration, a resident homeowner, renter, commercial property owner or commercial tenant is an End User. A Developer and any person or entity that constructs homes or commercial structures is not an End User. External Financial Advisor: means a consultant that: (1) is qualified to advise Colorado governmental entities on matters relating to the issuance of securities by Colorado governmental entities including matters such as the pricing, sales and marketing of such securities and the procuring of bond ratings, credit enhancement and insurance in respect of such securities; (2) shall be an underwriter, investment banker, or individual listed as a public finance advisor in the Bond Buyer’s Municipal Market Place or, in the City’s sole discretion, other recognized publication as a provider of financial projections; and (3) is not an officer or employee of the Districts or an underwriter of the Districts’ Debt. Fees: means the fees, rates, tolls, penalties and charges the Districts are authorized to impose and collect under this Service Plan. Financial Plan: means the Financial Plan described in Section IX of this Service Plan which was prepared by D.A. Davidson and Co. in accordance with the requirements of this Service Plan and describes (a) how the Public Improvements are to be financed; (b) how the Debt is expected to be incurred; and (c) the estimated operating revenue derived from property taxes and any Fees for the first budget year through the year in which all of the Districts’ Debt is expected to be defeased or paid in the ordinary course. Maximum Debt Authorization: means the total Debt the Districts are permitted to issue as set forth in Section IX.B.7 of this Service Plan. Maximum Debt Mill Levy Imposition Term: means the maximum term during which a District’s Debt Mill Levy may be imposed on residential property within its boundaries. This maximum term shall not exceed forty (40) years from December 31 of the year this Service Plan is approved by City Council. Operating Mill Levy: means a property tax mill levy imposed on Taxable Property for the purpose of funding District administration, operations and maintenance as authorized in this Service Plan, including, without limitation, repair and replacement of Public Improvements, and imposed at a rate not to exceed the limitations set in Section IX.B of this Service Plan. Planned Development: means the private development or redevelopment of the properties in the Service Area, commonly referred to as the Waterfield development, under an Approved Development Plan. Project: means the installation and construction of the Public Improvements for the Planned Development, commonly referred to as “Waterfield”.. Public Improvements: means the improvements and infrastructure the Districts are authorized by this Service Plan to fund and construct for the Planned Development to serve the future taxpayers and inhabitants of the Districts, except as specifically prohibited or limited in this Service Plan. Public Improvements shall include, without limitation, the improvements and infrastructure described in Exhibit “D” attached hereto and incorporated by reference. Public Improvements do not include Regional Improvements. 5 Regional Improvements: means any regional public improvement identified by the City, as provided in Section X of this Service Plan, for funding, in whole or part, by a Regional Mill Levy levied by the Districts. Regional Mill Levy: means the property tax mill tax imposed on Taxable Property for the purpose of planning, designing, acquiring, funding, constructing, installing, relocating and/or redeveloping the Regional Improvements and/or to fund the administration and overhead costs related to the Regional Improvements as provided in Section X of this Service Plan. Service Area: means the property within the District No. 1 Boundaries, District No. 2 Boundaries and District No. 3 Boundaries, collectively, as may be amended from time to time as further set forth in this Service Plan and the Special District Act. Special District Act: means Article 1 in Title 32 of the Colorado Revised Statutes, as amended. Service Plan: means this service plan for the Districts approved by the City Council. Service Plan Amendment: means a material modification of the Service Plan approved by the City Council in accordance with the Special District Act, this Service Plan and any other applicable law. State: means the State of Colorado. Taxable Property: means the real and personal property within the Service Area that will subject to the ad valorem taxes imposed by the Districts. TABOR: means Colorado’s Taxpayer’s Bill of Rights in Article X, Section 20 of the Colorado Constitution. Vicinity Map: means the map attached hereto as Exhibit “C” and incorporated by reference depicting the location of the Service Area within the regional area surrounding it. III. BOUNDARIES AND LOCATION The area of the Service Area includes approximately 93 acres. A legal description and map of the District No. 1 Boundaries are attached hereto as Exhibit A-1 and Exhibit B-1, respectively, a legal description and map of the District No. 2 Boundaries are attached hereto as Exhibit A-2 and Exhibit B-2, respectively, and a legal description and map of the District No. 3 Boundaries are attached hereto as Exhibit A-3 and Exhibit B-3, respectively. It is anticipated that the Districts’ boundaries may expand or contract from time to time as the Districts undertake inclusions or exclusions pursuant to the Special District Act, subject to the limitations set forth in this Service Plan. The location of the Service Area is further depicted in the Vicinity Map attached as Exhibit “C”. 6 IV. DESCRIPTION OF PROJECT, PLANNED DEVELOPMENT, PUBLIC BENEFITS & ASSESSED VALUATION A. Project and Planned Development. The current Developer of the Project and Planned Development, Thrive Home Builders, is a nationally acclaimed builder which emphasizes environmental conservation, and is currently Denver’s largest builder of “for sale” affordable housing. The current Preliminary Development Plan for the Planned Development includes approximately 190 total residential units and is intended to be revised to include 498 residential units. Of the planned 498 residential units, 50 units are intended to be “affordable housing”. All of the 498 residential units are planned to be zero energy ready units or net zero energy units. The Planned Development is currently intended to reach build out in 2026, with an estimated population of 1,145 persons. In accordance with the Financial Plan, the estimated assessed valuation of the Planned Development in 2023 will be $9,989,117, and in 2028 will be $18,743,620. Approval of this Service Plan by the City Council does not imply approval of the development of any particular land-use for any specific area within the Districts. Any such approval must be contained within an Approved Development Plan. B. Public Benefits. TheIn addition to providing a portion of the Public Improvements and Regional Improvements, the organization of the Districts is intended to enable the Project and Planned Development to deliver a number of public benefits, including, but not limited to, affordable housing, energy and water conservation, community services, multi-modal transportation, zero energy ready and net zero energy homes, housing variety, new urbanist alley load planning concepts and other innovation. The purpose of the Districts is to provide for the planning, design, acquisition, construction, installation, relocation and redevelopment of the Public Improvements necessary to enable the Project and Planned Development to develop as planned. A detailed description of the public benefits is attached hereto as Exhibit GThe public benefits to be provided under this Service Plan are specifically described in Exhibit G attached hereto and incorporated herein by reference (collectively, the “Public Benefits”). NotwithstandingTherefore, notwithstanding any provision to the contrary contained in this Service Plan, ano District shall not be authorized to issue any Debt, or to impose a Debt Mill Levy or any Fees for the purpose of repaymentpayment of Debt on any property within the Project Taxable Property unless and until the delivery of the Public Benefits specifically related to the phase of development or Public Improvements which willthe Planned Development or portion of the Project to be financed with such Debt, Debt Mill Levy or Fees, are secured in a manner approved by the City ManagerCouncil. To satisfy this prerequisiteprecondition to the issuance of Debt and to the imposition of taxesthe Debt Mill Levy and Fees, delivery of the Public Benefits for each phase of the Project and the Planned Development must be secured by one or both of the following methods, as applicable: 1. For any portion of the Public Benefits to be provided by one or more of the Districts, each such District must enter into an intergovernmental agreement with the City either 7 (i) agreeing to provide suchthose Public Benefits as a legally enforceable multiple- fiscal year obligation of the District under TABOR before the City is required to issue building permits and/or certificates of occupancy for structures to be built under an applicable Approved Development Plan for the Project or by, or by (ii) securing performance of that obligation with a surety bond, letter of credit or other security acceptable to the City Manager; and, and any such intergovernmental agreement must be approved by the City Council by resolution; 2. For any portion of the Public Benefits to be provided by one or more Developers of the ProjectPlanned Development, each such Developer must either (i) enter into a development agreement with the City under the Developer’s applicable Approved Development Plan, which agreement must legally obligate the Developer to provide those Public Benefits before the City is required to issue building permits and/or certificates of occupancy for structures to be built under the Approved Development Plan for that phase of the ProjectPlanned Development, or to(ii) secure such obligations with a surety bond, letter of credit or other security acceptable to the City Manager., and all such development agreements must be approved by the City Council by resolution; or 3. For any portion of the Public Benefits to be provided in part by one or more of the Districts in the Project and in part by one or more of the Developers in the Planned Development or the Project, an agreement between the City and the affected District(s) and Developers that secures such Public Benefits as legally binding obligations using the methods described in subsections 1 and 2 above, and all such agreements must be approved by the City Council by resolution. C. Assessed Valuation The current assessed valuation of the Service Area is approximately One Million Two Hundred Sixty-Seven Thousand Two Hundred Dollars ($1,267,200) and, at build out, is expected to be approximately Nineteen Million Dollars ($19,000,000). These amounts are expected to be sufficient to reasonably discharge the Debt as demonstrated in the Financial Plan. V. INCLUSION OF LAND IN THE SERVICE AREA The Districts shall not add any property to the Service Area without the City Council’s prior written approval and in compliance with the Special District Act. Once a District has issued Debt, it shall not exclude real property from the District’s boundaries without the prior written consent of the City Council. VI. DISTRICT GOVERNANCE The Districts’ Boards shall be comprised of persons who are a qualified “eligible electors” of the Districts as provided in the Special District Act. It is anticipated that over time, the End Users who are eligible electors will assume direct electoral control of the Districts’ Boards as development within the Service Area progresses. The Districts shall not enter into any agreement by which the End Users’ electoral control of the Boards is removed or diminished. VII. AUTHORIZED AND PROHIBITED POWERS 8 A. General Grant of Powers. The Districts shall have the power and authority to provide the Public Improvements, the Regional Improvements and related operation and maintenance services, within and without the Service Area, as such powers and authorities are described in the Special District Act, other applicable State law, common law and the Colorado Constitution, subject to the prohibitions, restrictions and limitations set forth in this Service Plan. If, after the Service Plan is approved, any State law is enacted to grant additional powers or authority to metropolitan districts by amendment of the Special District Act or otherwise, such powers and authority shall be deemed to be a part hereof and available to be exercised by the Districts if the City Council first approves the exercise of such powers or authority by the Districts. Such approval by the City Council shall not constitute a Service Plan Amendment. B. Prohibited Improvements and Services and other Restrictions and Limitations. The Districts’ powers and authority under this Service Plan to provide Public Improvements and services and to otherwise exercise their other powers and authority under the Special District Act and other applicable State law, are prohibited, restricted and limited as hereafter provided. Failure to comply with these prohibitions, restrictions and limitations shall constitute a material modification under this Service Plan and shall entitle the City to pursue all remedies available at law and in equity as provided in Section XVII of this Service Plan: 1. Eminent Domain Restriction The Districts shall not exercise their statutory power of eminent domain without first obtaining resolution approval from the City Council. This restriction on the Districts’ exercise of the eminent domain power is being voluntarily acquiesced to by the Districts and shall not be interpreted in any way as a limitation on the Districts’ sovereign powers and shall not negatively affect the Districts’ status as political subdivision of the State as conferred by the Special District Act. 2. Fee Limitation AllAny Fees imposed for the repayment of Debt, as authorized by this Service Plan, mayshall not be imposed by the Districts upon all property within their respective boundaries only if suchor collected from an End User. In addition, Fees are dueimposed for the payment of Debt shall not be imposed unless and payable no later than upon the issuance of a building permit byuntil the City for those propertiesrequirements for securing the delivery of the relevant portion of the Public Benefits have been satisfied in accordance with Section IV.B of this Service Plan. Notwithstanding any of the foregoing, this Fee limitation shall not apply to any Fee imposed to fund the operation, maintenance, repair or replacement of Public Improvements or the administration of the Districts, nor shall this Fee limitation apply to a District if a majority of the District’s Board imposing such Fee is composed of End Users.. 9 3. Operations and Maintenance The primary purpose of the Districts is to plan for, design, acquire, construct, install, relocate, redevelop and finance a portion of the Public Improvements. The Districts shall dedicate the Public Improvements to the City or other appropriate jurisdiction or owners’ association in a manner consistent with the Approved Development Plan and the City Code, provided that nothing herein requires the City to accept a dedication. Each District is specifically authorized to operate and maintain any part or all of the Public Improvements not otherwise conveyed or dedicated to the City or another appropriate governmental entity. The Districts shall also be specifically authorized to conduct operations and maintenance functions related to the Public Improvements that are not provided by the City or other governmental entity, or to the extent that the Districts’ proposed operational and maintenance functions included services or activities that exceed those provided by the City or other governmental entity. Additionally, the Districts are authorized to operate and maintain any part or all of the Public Improvements not otherwise conveyed or dedicated to the City or another appropriate governmental entity until such time that the Districts dissolve. 4. Fire Protection Restriction The Districts are not authorized to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain fire protection facilities or services, unless such facilities and services are provided pursuant to an intergovernmental agreement with the Poudre Fire Authority. The authority to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain fire hydrants and related improvements installed as part of the water system shall not be limited by this subsection. 5. Public Safety Services Restriction The Districts are not authorized to provide policing or other security services. However, the Districts may, pursuant to C.R.S. § 32-1-1004(7), as amended, furnish security services pursuant to an intergovernmental agreement with the City. 6. Grants from Governmental Agencies Restriction The Districts shall not apply for grant funds distributed by any agency of the United States Government or the State without the prior written approval of the City Manager. This does not restrict the collection of Fees for services provided by the Districts to the United States Government or the State. 7. Golf Course Construction Restriction Acknowledging that the City has financed public golf courses and desires to coordinate the construction of public golf courses within the City’s boundaries, the Districts shall not be authorized to plan, design, acquire, construct, install, relocate, redevelop, finance, own, 10 operate or maintain a golf course unless such activity is pursuant to an intergovernmental agreement with the City. 8. Television Relay and Translation Restriction The Districts are not authorized to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain television relay and translation facilities and services, other than for the installation of conduit as a part of a street construction project, unless such facilities and services are provided pursuant to prior written approval from the City ManagerCouncil. 9. Potable Water and Wastewater Treatment Facilities Acknowledging that the City and other existing special districts operating within the City currently own and operate treatment facilities for potable water and wastewater that are available to provide services to the Service Area, the Districts shall not plan, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain such facilities without obtaining the City Council’s prior written approval. either by intergovernmental agreement or as a Service Plan Amendment. 10. Sales and Use Tax Exemption Limitation The Districts shall not exercise any City sales and use tax exemption otherwise available to the Districts under the City Code. 11. Sub-district Restriction The Districts shall not create any sub-district pursuant to the Special District Act without the prior written approval of the City Manager. 12. Privately Placed Debt Limitation Prior to the issuance of any privately placed Debt, the Districts shall obtain the certification of an External Financial Advisor substantially as follows: We are [I am] an External Financial Advisor within the meaning of the District’s Service Plan. We [I] certify that (1) the net effective interest rate (calculated as defined in C.R.S. Section 32-1-103(12)) to be borne by [insert the designation of the Debt] does not exceed a reasonable current [tax- exempt] [taxable] interest rate, using criteria deemed appropriate by us [me] and based upon our [my] analysis of comparable high yield securities; and (2) the structure of [insert designation of the Debt], including maturities and early redemption provisions, is reasonable considering the financial circumstances of the District. 11 13. Special Assessments The Districts shall not impose special assessments without the prior written approval of the City Council. VIII. PUBLIC IMPROVEMENTS AND ESTIMATED COSTS Exhibit D summarizes the type of Public Improvements that are projected to be constructed and/or installed by the Districts. The cost, scope, and definition of such Public Improvements may vary over time. The total estimated costs of Public Improvements, as set forth in Exhibit D, excluding any improvements paid for by the Regional Mill Levy necessary to serve the Planned Development, are approximately Forty-Three Million Nine Hundred Eighty One Thousand Fifty Dollars ($43,981,050) in project costs in 2018 dollars. The cost estimates are based upon preliminary engineering, architectural surveys, and reviews of the Public Improvements and include all construction cost estimates together with estimates of costs such as land acquisition, engineering services, legal expenses and other associated expenses. Maps of the anticipated location, operation, and maintenance of Public Improvements are attached hereto as Exhibit E. Changes in the Public Improvements or costs, which are approved by the City in an Approved Development Plan, shall not constitute a Service Plan Amendment. In addition, the City shall not be bound by this Service Plan in reviewing and approving the Approved Development Plan and the Approved Development Plan shall supersede the Service Plan with regard to the cost, scope, and definition of Public Improvements and definition of Public Improvements. Provided, however, any agreement approved and entered into under Section IV.B of this Service Plan for the provision of a Public Improvement that is also a Public Benefit, shall supersede both this Service Plan and the applicable Approved Development Plan. TheExcept as otherwise provided by an agreement approved under Section IV.B of this Service Plan: (i) the design, phasing of construction, location and completion of Public Improvements will be determined by the Districts to coincide with the phasing and development of the Planned Development and the availability of funding sources. The; (ii) the Districts may, in their discretion, phase the construction, completion, operation, and maintenance of Public Improvements or defer, delay, reschedule, rephase, relocate or determine not to proceed with the construction, completion, operation, and maintenance of Public Improvements, and such actions or determinations shall not constitute a Service Plan Amendment. The; and (iii) the Districts shall also be permitted to allocate costs between such categories of the Public Improvements as deemed necessary in its discretion. The City Code has development standards, contracting requirements and other legal requirements related to the construction and payment of public improvements and related to certain operation activities. Relating to these, the Districts shall comply with the following requirements: A. Development Standards. The Districts shall ensure that the Public Improvements are designed and constructed in accordance with the standards and specifications of the City Code and of other governmental entities having proper jurisdiction, as applicable. The Districts directly, or indirectly through any Developer, will obtain the City’s approval of civil engineering plans and will obtain applicable permits for construction and installation of Public Improvements prior to performing such work. Unless waived by the City Council, the Districts shall be required, in accordance with the City 12 Code, to post a surety bond, letter of credit, or other approved development security for any Public Improvements to be constructed by the Districts. Such development security may be released in the City ManagersManager’s discretion when the constructing District has obtained funds, through Debt issuance or otherwise, adequate to insure the construction of the Public Improvements, unless such release is prohibited by or in conflict with any City Code provision or State law., State law or any agreement approved and entered into under Section IV.B of this Service Plan. Any limitation or requirement concerning the time within which the City must review the Districts’ proposal or application for an Approved Development Plan or other land use approval is hereby waived by the Districts. B. Contracting. The Districts shall comply with all applicable State purchasing, public bidding and construction contracting. C. Land Acquisition and Conveyance. The purchase price of any land or improvements acquired by the Districts from the Developer shall be no more than the then-current fair market value as confirmed by an independent MAI appraisal for land and by an independent professional engineer for improvements. Land, easements, improvements and facilities conveyed to the City shall be free and clear of all liens, encumbrances and easements, unless otherwise approved by the City Manager prior to conveyance. All conveyances to the City shall be by special warranty deed, shall be conveyed at no cost to the City, shall include an ALTA title policy issued to the City, shall meet the environmental standards of the City and shall comply with any other conveyance prerequisites required in the City Code. D. Equal Employment and Discrimination. In connection with the performance of all acts or activities hereunder, the Districts shall not discriminate against any person otherwise qualified with respect to its hiring, discharging, promoting or demoting or in matters of compensation solely because of race, color, religion, national origin, gender, age, military status, sexual orientation, gender identity or gender expression, marital status, or physical or mental disability, and further shall insert the foregoing provision in contracts or subcontracts entered into by the Districts to accomplish the purposes of this Service Plan. IX. FINANCIAL PLAN/PROPOSED DEBT This Section IX of the Service Plan describes the nature, basis, method of funding and financing limitations associated with the acquisition, construction, completion, repair, replacement, operation and maintenance of Public Improvements. A. Financial Plan. The Districts’ Financial Plan, attached as Exhibit F and incorporated by reference, reflects the Districts’ anticipated schedule for incurring Debt to fund Public Improvements in support of the Project. The Financial Plan also reflects the schedule of all anticipated revenues flowing to the Districts derived from Districts’ mill levies, Fees imposed by the Districts, specific ownership taxes, and all other anticipated legally available revenues. The Financial Plan is based on economic, political and industry conditions as they exist presently and reasonable projections and estimates of future conditions. These projections and estimates are not to be interpreted as the only 13 method of implementation of the Districts’ goals and objectives but rather a representation of one feasible alternative. Other financial structures may be used so long they are in compliance with this Service Plan. The Financial Plan incorporates all of the provisions of this Section IX. Based upon the assumptions contained therein, the Financial Plan projects the issuance of Bonds to fund Public Improvements and anticipated Debt repayment based on the development assumptions and absorptions of the property in the Service Area by End Users. The Financial Plan anticipates that the Districts will acquire, construct, and complete all of the Public Improvements needed to serve the Service Area. The Financial Plan demonstrates that the Districts will have the financial ability to discharge all Debt to be issued as part of the Financial Plan on a reasonable basis. Furthermore, the Districts will secure the certification of an External Financial Advisor who will provide an opinion as to whether such Debt issuances are in the best interest of the Districts at the time of issuance. B. Mill Levies. It is anticipated that the Districts will impose a Debt Mill Levy and an Operating Mill Levy on all property within the Service Area. In doing so, the following shall apply: 1. Aggregate Mill Levy Maximum The Aggregate Mill Levy shall not exceed in any year the Aggregate Mill Levy Maximum, which is fifty (50) mills. 2. Regional Mill Levy Not Included in Other Mill Levies The Regional Mill Levy shall not be counted against the Aggregate Mill Levy Maximum. 3. Operating Mill Levy Each District may impose an Operating Mill Levy of up to fifty (50) mills until such District imposes a Debt Mill Levy. Once a District imposes a Debt Mill Levy of any amount, such District’s Operating Mill Levy shall not exceed ten (10) mills at any point. Notwithstanding any of the foregoing, the Operating Mill Levy limitation set forth in this Section IX.B.3 shall not apply if the majority of the District’s Board imposing such Operating Mill Levy is composed of End Users, subject to continual compliance with the Aggregate Mill Levy Maximum. 4. Gallagher Adjustments In the event the State’s method of calculating assessed valuation for the Taxable Property changes after January 1, 2018, or any subsequent constitutionally mandated tax credit, cut or abatement, the Districts’ Aggregate Mill Levy, Debt Mill Levy, Operating Mill Levy, and Aggregate Mill Levy Maximum, amounts herein provided may be increased or decreased to reflect such changes; such increases or decreases shall be determined by the District’s Board in good faith so that to the extent possible, the 14 actual tax revenues generated by such mill levies, as adjusted, are neither enhanced nor diminished as a result of such change occurring after January 1, 2018. For purposes of the foregoing, a change in the ratio of actual valuation to assessed valuation will be a change in the method of calculating assessed valuation. 5. Excessive Mill Levy Pledges Any Debt issued with a mill levy pledge, or which results in a mill levy pledge, that exceeds the Aggregate Mill Levy Maximum or the Maximum Debt Mill Levy Imposition Term, shall be deemed a material modification of this Service Plan and shall not be an authorized issuance of Debt unless and until such material modification has been approved by a Service Plan Amendment. 6. Refunding Debt The Maximum Debt Mill Levy Imposition Term may be exceeded for Debt refunding purposes if: (1) a majority of the issuing District’s Board is composed of End Users and have voted in favor of a refunding of a part or all of the Debt; or (2) such refunding will result in a net present value savings. 7. Maximum Debt Authorization The Districts anticipate approximately Forty Three Million Nine Hundred Eighty One Thousand Fifty Dollars ($43,981,050) in project costs in 2018 dollars as set forth in Exhibit D, and anticipate issuing approximately Twenty Two Million Four Hundred Twenty Nine Thousand Seven Hundred Fifty Dollars ($22,429,750) in Debt to pay such costs as set forth in Exhibit F, which Debt issuance amount shall be the amount of the Maximum Debt Authorization. The Districts collectively shall not issue Debt in excess of the Maximum Debt Authorization. In addition, no District shall issue any Debt unless and until delivery of the relevant portion of the Public Benefits have been secured as required in Section IV.B of this Service Plan. Bonds, loans, notes or other instruments which have been refunded shall not count against the Maximum Debt Authorization. Intergovernmental Capital Pledge Agreements among two or more of the Districts pledging the collection and payment of property taxes or Fees by one District for the repayment of Debt by a separate issuing District shall not count against the Maximum Debt Authorization. The Districts must seek prior resolution approval by the City Council to issue Debt in excess of the Maximum Debt Authorization to pay the actual costs of the Public Improvements set forth in Exhibit D plus inflation, contingencies and other unforeseen expenses associated with such Public Improvements. Such approval by the City Council shall not constitute a material modification of this Service Plan requiring a Service Plan Amendment so long as increases are reasonably related to the Public Improvements set forth in Exhibit D and any Approved Development Plan. C. Maximum Voted Interest Rate and Underwriting Discount. The interest rate on any Debt is expected to be the market rate at the time the Debt is issued. The maximum interest rate on any Debt, including any defaulting interest rate, is not permitted to exceed Twelve Percent (12%). The maximum underwriting discount shall be three percent (3%). 15 Debt, when issued, will comply with all relevant requirements of this Service Plan, the Special District Act, other applicable State law and federal law as then applicable to the issuance of public securities. D. Interest Rate and Underwriting Discount Certification. The Districts shall retain an External Financial Advisor to provide a written opinion on the market reasonableness of the interest rate on any Debt and any underwriter discount paid by the Districts as part of a Debt financing transaction. The Districts shall provide this written opinion to the City before issuing any Debt based on it. E. Disclosure to Purchasers. In order to notify future End Users who are purchasing residential lots or dwellings units in the Service Area that they will be paying, in addition to the property taxes owed to other taxing governmental entities, the property taxes imposed under the Debt Mill Levy, the Operating Mill Levy and possibly the Regional Mill Levy, the Districts shall not be authorized to issue any Debt under this Service Plan until there is included in the Developer’s Approved Development Plan provisions that require the following: 1. That the Developer, and its successors and assigns, shall prepare and submit to the City Manager for his approval a disclosure notice in substantially the form attached hereto as Exhibit H (the “Disclosure Notice”); 2. That when the Disclosure Notice is approved by the City Manager, the Developer shall record the Disclosure Notice in the Larimer County Clerk and Recorders Office; and 3. That the approved Disclosure Notice shall be provided by the Developer, and by its successors and assigns, to each potential End User purchaser of a residential lot or dwelling unit in the Service Area before that purchaser enters into a written agreement for the purchase and sale of that residential lot or dwelling unit. F. External Financial Advisor. An External Financial Advisor shall be retained by the Districts to provide a written opinion as to whether any Debt issuance is in the best interest of the issuing District once the total amount of Debt issued by the Districts exceeds Five Million Dollars ($5,000,000). The External Financial Advisor is to provide advice to the issuing District’s Board regarding the proposed terms and whether Debt conditions are reasonable based upon the status of development within the District, the projected tax base increase in the District, the security offered and other considerations as may be identified by the Advisor. The issuing District shall include in the transcript of any Bond transaction, or other appropriate financing documentation for related Debt instrument, a signed letter from the External Financial Advisor providing an official opinion on the structure of the Debt, stating the Advisor’s opinion that the cost of issuance, sizing, repayment term, redemption feature, couponing, credit spreads, payment, closing date, and other material transaction details of the proposed Debt serve the best interest of the issuing District. 16 Debt shall not be undertaken by the Districts if found to be unreasonable by the External Financial Advisor. G. Disclosure to Debt Purchasers. Any Debt of the Districts shall set forth a statement in substantially the following form: “By acceptance of this instrument, the owner of this Debt agrees and consents to all of the limitations with respect to the payment of the principal and interest on this Debt contained herein, in the resolution of the District authorizing the issuance of this Debt and in the Service Plan of the District. This Debt is not and cannot be a Debt of the City of Fort Collins” Similar language describing the limitations with respect to the payment of the principal and interest on Debt set forth in this Service Plan shall be included in any document used for the offering of the Debt for sale to persons, including, but not limited to, a Developer of property within the Service Area. H. Security for Debt. The Districts shall not pledge any revenue or property of the City as security for the indebtedness set forth in this Service Plan. Approval of this Service Plan shall not be construed as a guarantee by the City of payment of any of the Districts’ obligations; nor shall anything in the Service Plan be construed so as to create any responsibility or liability on the part of the City in the event of default by the Districts in the payment of any such obligations. I. TABOR Compliance. The Districts shall comply with the provisions of TABOR. In the discretion of the Boards, the Districts may set up other qualifying entities to manage, fund, construct and operate facilities, services, and programs. To the extent allowed by law, any entity created by a District will remain under the control of the District’s Board. J. Districts’ Operating Costs. The estimated cost of acquiring land, engineering services, legal services and administrative services, together with the estimated costs of the Districts’ organization and initial operations, are anticipated to be $200,000, which will be eligible for reimbursement from Debt proceeds. In addition to the capital costs of the Public Improvements, the Districts will require operating funds for administration and to plan and cause the Public Improvements to be operated and maintained. The first year’s operating budget is estimated to be $100,000. Ongoing administration, operations and maintenance costs may be paid from property taxes collected through the imposition of an Operating Mill Levy as set forth in Section IX.B.3 of this Service Plan, as well as other revenues legally available to the Districts. X. REGIONAL IMPROVEMENTS The Districts shall be authorized to provide for the planning, design, acquisition, funding, construction, installation, relocation, redevelopment, administration and overhead costs related to 17 the provision of Regional Improvements. At the discretion of the City, the Districts shall impose a Regional Improvement Mill Levy on all property within the Districts’ boundaries under the following terms: A. Regional Mill Levy Authority. The Districts shall seek the authority to impose an additional Regional Mill Levy of five (5) mills as part of the Districts’ initial TABOR election. The Districts shall also seek from the electorate in that election the authority under TABOR to enter into an intergovernmental agreement with the City obligating the Districts to pay as a multiple-fiscal year obligation the proceeds from the Regional Mill Levy to the City. Obtaining such voter-approval of the Regional Mill Levy and this intergovernmental agreement shall be a precondition to the Districts issuing any Debt and imposing the Operating Mill Levy, the Debt Mill Levy and any Fees for the repayment of Debt under this Service Plan. B. Regional Mill Levy Imposition. The Districts shall each impose the Regional Mill Levy at a rate not to exceed five (5) mills within one year of receiving written notice from the City Manager to the Districts requesting the imposition of the Regional Mill Levy and stating the mill rate to be imposed. C. City Notice Regarding Regional Improvements. Such notice from the City shall provide a description of the Regional Improvements to be constructed and an analysis explaining how the Regional Improvements will be beneficial to property owners within the Service Area. The City shall make a good faith effort to require planned developments that (i) are adjacent to the Service Area and (ii) will benefit from the Regional Improvement also impose a Regional Mill Levy, to the extent possible. D. Regional Improvements Authorized Under Service Plan. If the Districts are so notified by the City Manager, the Regional Improvements shall be considered public improvements that the Districts would otherwise be authorized to design, construct, install re-design, re-construct, repair or replace pursuant to this Service Plan and applicable law. E. Expenditure of Regional Mil Levy Revenues. Revenue collected through the imposition of the Regional Mill Levy shall be expended as follows: 1. Intergovernmental Agreement If the City and the Districts have executed an intergovernmental agreement concerning the Regional Improvements, then the revenue from the Regional Mill Levy shall be used in accordance with such agreement; or 2. No Intergovernmental Agreement If no intergovernmental agreement exists between the Districts and the City, then the revenue from the Regional Mill Levy shall be paid to the City, for use by the City in the planning, designing, constructing, installing, acquiring, relocating, redeveloping or financing of Regional Improvements which benefit the End Users of the Districts as prioritized and determined by the City. F. Regional Mill Levy Term. 18 The imposition of the Regional Mill Levy shall not exceed a term of twenty-five (25) years from December 31 of the tax collection year after which the Regional Mill Levy is first imposed. G. Completion of Regional Improvements. All Regional Improvements shall be completed prior to the end of the twenty-five (25) year Regional Mill Levy term. H. City Authority to Require Imposition. The City’s authority to require the initiation of the imposition of a Regional Mill Levy shall expire fifteen (15) years after December 31st of the year in which a District first imposes a Debt Mill Levy. I. Regional Mill Levy Not Included in Other Mill Levies. The Regional Mill Levy imposed shall not be applied toward the calculation of the Aggregate Mill Levy Maximum. J. Gallagher Adjustment. In the event the method of calculating assessed valuation is changed after January 1, 2018, or any subsequent constitutionally mandated tax credit, cut or abatement, the Regional Mill Levy may be increased or shall be decreased to reflect such changes; such increases or decreases shall be determined by the Districts’ Boards in good faith so that to the extent possible, the actual tax revenues generated by the Regional Mill Levy, as adjusted, are neither enhanced nor diminished as a result of such change occurring after January 1, 2018. For purposes of the foregoing, a change in the ratio of actual valuation to assessed valuation will be a change in the method of calculating assessed valuation XI. CITY FEES The Districts shall pay all applicable City fees as required by the City Code. XII. BANKRUPTCY LIMITATIONS All of the limitations contained in this Service Plan, including, but not limited to, those pertaining to the Aggregate Mill Levy Maximum, Maximum Debt Mill Levy Imposition Term and Fees, have been established under the authority of the City in the Special District Act to approve this Service Plan. It is expressly intended that by such approval such limitations: (i) shall not be set aside for any reason, including by judicial action, absent a Service Plan Amendment; and (ii) are, together with all other requirements of State law, included in the “political or governmental powers” reserved to the State under the U.S. Bankruptcy Code (11 U.S.C.) Section 903, and are also included in the “regulatory or electoral approval necessary under applicable non-bankruptcy law” as required for confirmation of a Chapter 9 Bankruptcy Plan under Bankruptcy Code Section 943(b)(6). XIII. ANNUAL REPORTS AND BOARD MEETINGS 19 A. General. Each of the Districts shall be responsible for submitting an annual report to the City Clerk no later than September 1st of each year following the year in which the Order and Decree creating the Districts have been issued. The Districts may file a consolidated annual report. The annual report may be made available to the public on the City’s website. B. Board Meetings. Each of the Districts’ Boards shall hold at least one public board meeting in three of the four quarters of each calendar year, beginning in the first full calendar year after the Districts’ creation. Notice for each of these meetings shall be given in accordance with the requirements of the Special District Act and other applicable State Law. This meeting requirement shall not apply until there is at least one End User of property within the District. Also, this requirement shall no longer apply when a majority of the directors on the District’s Board are End Users. C. Report Requirements. Unless waived by the City Manager, each of the Districts’ annual report must include the following: 1. Narrative A narrative summary of the progress of the District in implementing its Service Plan for the report year. 2. Financial Statements Except when exemption from audit has been granted for the report year under the Local Government Audit Law, the audited financial statements of the District for the report year including a statement of financial condition (i.e., balance sheet) as of December 31 of the report year and the statement of operation (i.e., revenue and expenditures) for the report year. 3. Capital Expenditures Unless disclosed within a separate schedule to the financial statements, a summary of the capital expenditures incurred by the District in development of improvements in the report year. 4. Financial Obligations Unless disclosed within a separate schedule to the financial statements, a summary of financial obligations of the District at the end of the report year, including the amount of outstanding Debt, the amount and terms of any new District Debt issued in the report year, the total assessed valuation of all Taxable Property within the Service Area as of January 1 of the report year and the current total District mill levy pledged to Debt retirement in the report year. 5. Board Contact Information 20 The names and contact information of the current directors on the District’s Board, any District manager and the attorney for the District shall be listed in the report. The District’s current office address, phone number, email address and any website address shall also be listed in the report. 6. Other Information Any other information deemed relevant by the City Council or deemed reasonably necessary by the City Manager. D. Reporting of Significant Events. The annual report of each District shall also include information as to any of the following that occurred during the report year: 1. Boundary changes made or proposed to the District’s boundaries as of December 31 of the report year. 2. Intergovernmental Agreements with other governmental entities, either entered into or proposed as of December 31 of the report year. 3. Copies of the District’s rules and regulations, if any, or substantial changes to the District’s rules and regulations as of December 31 of the report year. 4. A summary of any litigation which involves the District’s Public Improvements as of December 31 of the report year. 5. A list of all facilities and improvements constructed by the District that have been dedicated to and accepted by the City as of December 31 of the report year. 6. Notice of any uncured events of default by the District, which continue beyond a ninety (90) day period, under any Debt instrument. 7. Any inability of the District to pay its obligations as they come due, in accordance with the terms of such obligations, which continue beyond a ninety (90) day period. E. Failure to Submit. In the event the annual report is not timely received by the City Clerk or is not fully responsive, notice of such default shall be given to the District’s Board at its last known address. The failure of the District to file the annual report within forty-five (45) days of the mailing of such default notice by the City Clerk may constitute a material modification of the Service Plan, at the discretion of the City Manager. XIV. SERVICE PLAN AMENDMENTS This Service Plan is general in nature and does not include specific detail in some instances. The Service Plan has been designed with sufficient flexibility to enable the Districts to provide required improvements, services and facilities under evolving circumstances without the need for numerous amendments. Modification of the general types of improvements and facilities making up the Public Improvements, and changes in proposed configurations, locations or dimensions of the Public Improvements, shall be permitted to accommodate development needs provided such 21 Public Improvements are consistent with the then-current Approved Development Plans for the Project and any agreement approved by City Council pursuant Section IV.B of this Service Plan. Any action of one or more of the Districts, which is a material modification of this Service Plan requiring a Service Plan Amendment as provided in Section XV of this Service Plan or that is a violation or breach of any other applicable provision of this Service Plan, shall be deemed to be a material modification to this Service Plan unless otherwise expressly provided in this Service Plan. All other departures from the provisions of this Service Plan shall be considered on a case-by-case basis as to whether such departures are a material modification under this Service Plan or the Special District Act. XV. MATERIAL MODIFICATIONS Material modifications to this Service Plan may be made only in accordance with C.R.S. Section 32-1-207 as a Service Plan Amendment. No modification shall be required for an action of the Districts that does not materially depart from the provisions of this Service Plan, unless otherwise provided in this Service Plan. Departures from the Service Plan by any of the Districts that constitute a material modification requiring a Service Plan Amendment include, without limitation: 1. Actions or failures to act that create materially greater financial risk or burden to the taxpayers of any of the Districts; 2. Performance of a service or function, construction of an improvement, or acquisition of a major facility that is not closely related to an improvement, service, function or facility authorized in the Service Plan; 3. Failure to perform a service or function, construct an improvement or acquire a facility required by the Service Plan; and 4. Failure to comply with any of the preconditions, prohibitions, limitations and restrictions of this Service Plan. Actions that are not to be considered material modifications include, without limitation, changes in quantities of improvements, facilities or equipment; immaterial cost differences; and actions expressly authorized in this Service Plan. XVI. DISSOLUTION Upon independent determination by the City Council that the purposes for which any District was created have been accomplished, the District shall file a petition in district court for dissolution as provided in the Special District Act. In no event shall dissolution occur until such District has provided for the payment or discharge of all of its outstanding indebtedness and other financial obligations as required pursuant to the Special District Act or any other applicable State law. In addition, if within three (3) years from the date of the City Council’s approval of this Service Plan no agreement contemplated under Section IV.B of this Service Plan has been entered into by the City with any of the Districts and/or any Developer, despite the parties conducting good faith negotiations attempting to do so, the City may opt to pursue the remedies available to it under C.R.S. Section 32-1-701(3) in order to compel the Districts to dissolve in a prompt and orderly manner. In such event: (i) the limited purposes and powers of the Districts, as authorized herein, 22 shall automatically terminate and be expressly limited to taking only those actions that are reasonably necessary to dissolve; (ii) the Board of Directors of each of the Districts will be deemed to have agreed with the City regarding its dissolution without an election pursuant to C.R.S. §32- 1-704(3)(b); (iii) the Districts shall take no action to contest or impede the dissolution of the Districts and shall affirmatively and diligently cooperate in securing the final dissolution of the Districts, and (iv) subject to the statutory requirements of the Special District Act, the Districts shall thereupon dissolve. XVII. SANCTIONS Should any of the Districts undertake any act without obtaining prior City Council approval or consent or City Manager approval or consent, as required in under this Service Plan, or that constitutes a material modification to this Service Plan requiring a Service Plan Amendment as provided herein or under the Special Districts Act, or that violates or is in breach of any provision of this Service Plan, the City Council may impose one (1) or more of the following sanctions, as it deems appropriate: 1. Exercise any applicable remedy under the Special District Act; 2. Withhold the issuance of any permit, authorization, acceptance or other administrative approval, or withhold any cooperation, necessary for the District’s development or construction or operation of improvements or provision of services; 3. Exercise any legal remedy under the terms of any intergovernmental agreement under which the District is in default; or 4. Exercise any other legal and equitable remedy available under the law, including seeking prohibitory and mandatory injunctive relief against the District, to ensure compliance with the provisions of the Service Plan or applicable law. XVIII. CONCLUSION It is submitted that this Service Plan, as required by C.R.S. Section 32-1-203(2), establishes that: 1. There is sufficient existing and projected need for organized service in the Service Area to be served by the Districts; 2. The existing service in the Service Area to be served by the Districts is inadequate for present and projected needs; 3. The Districts are capable of providing economical and sufficient service to the Service Area; and 4. The Service Area does have, and will have, the financial ability to discharge the proposed indebtedness on a reasonable basis. XIX. RESOLUTION OF APPROVAL The Districts agree to incorporate the City Council’s resolution approving this Service Plan, including any conditions imposed by the City Council on such approval, into the copy of the Service Plan presented to the District Court for and in Larimer County, Colorado. 23 1 EXHIBIT A-1 Legal Description of District No. 1 Boundaries EXHIBIT A-2 Legal Description of District No. 2 Boundaries EXHIBIT A-3 Legal Description of District No. 3 Boundaries EXHIBIT B-1 District No. 1 Boundary Map EXHIBIT B-2 District No. 2 Boundary Map EXHIBIT B-3 District No. 3 Boundary Map EXHIBIT C Vicinity Map EXHIBIT D Public Improvement Cost Estimates EXHIBIT E Public Improvement Maps EXHIBIT F Financial Plan EXHIBIT G Public Benefits EXHIBIT H Disclosure Notice Attachment 3 ‐ Policy Matrix GHG Reduction 100% Zero Energy Ready; 10% Zero Energy; 10% Rooftop Solar; Possibly Distributed Storage Increase Density Yes, New Urbanist Affordable Housing 10% of units; Approx. 50 lots Water/Energy Conservation 100% Zero Energy Ready; 10% Zero Energy; 10% Rooftop Solar; Possibly Distributed Storage Walkability/ Pedestrian Infrastructure Wider sidewalks on Suniga Workforce Housing N/A Multimodal Transportation Buffered Bike Lanes on Suniga Availability of Transit N/A Infill/ Redevelopment N/A Enhance Resiliency N/A Public Space Pocket Parks; Mixed‐Use Open Space Increase Renewable Capacity 10% Rooftop Solar; or Distributed Storage Mixed‐Use N/A Off‐Site N/A Economic Health N/A PUBLIC BENEFIT/POLICY ASSESSMENT MATRIX Environmental Sustainability Critical Public Infrastructure Smart Growth Management Strategic Priorities On‐Site 4‐Lane Arterial (Suniga) Waterfield Metro District Nos. 1-3 The proposed Consolidated Service Plan for Waterfield Metropolitan District Nos. 1-3 will support the construction of approximately 498 homes on 71 acres at the northwest corner of Vine Drive and Timberline Road. The project, called Waterfield (the “Project”), will follow Thrive’s commitment to healthy, efficient, and local home construction, including all their normal standards and re-plat the project to provide urban design and density, alleys, and walkable features. The Project was compared to the currently platted development assuming basic code standards. Therfore, this Triple Bottom Line Scan (“TBLs”) evaluates the difference between the two forms of development and does not compare the Project against the current vacant land as that condition is not anticipated to persist. Positive Consumes less land for the same number of units due to higher density new urbanist approach to lot layout Supports Climate Action Plan 2020 goals by constructing all homes at Zero Energy Ready standard, 10 percent at net zero energy, and 10 percent with solar or distributed storage equivalent Will provide indirect education of environmental stewardship principles by providing 500 new homeowners with a greater understanding of their own energy and water usage Negative All other conditions are neutral Positive Supports future infrastructure needs by constructing a significant portion of Suniga a new 4-lane arterial Supports talent development in the community by providing additional housing opportunity – some affordable (10 percent) Negative Impacts the cost of living by increasing property taxes for the 500 home owners, offset in part by energy efficiency and affordable housing (Slightly Negative to Neutral) All other conditions are neutral Positive Homes will be constructed to a higher standard for indoor air quality The Project will be constructed to encourage walkability Project will provide 50 affordable units dispersed throughout the project – supporting the City’s affordable housing goals and enhancing the inclusivity of the community Negative All other conditions are neutral Tradeoffs • Increased property tax may discourage some buyers from considering the Project – lower utility costs through Waterfield Metro District Nos. 1-3 City Council adopted a revised policy for Reviewing Metropolitan District Service Plans (the “Metro District Policy”) on August 21, 2018. The Metro District Policy allows for a wide range of projects to apply for the use of Metro Districts to offset either extraordinary costs or basic costs that enable the delivery of extraordinary development outcomes. These extraordinary outcomes cover a range of possibilities generally grouped into four categories: Environmental Sustainability, Critical Infrastructure, Smart Growth Management, and Strategic Priorities. In addition, the Metro District Policy requires that each proposed use of the public finance tool undergo a TBLs. For the proposed Project, the TBLs focused on the impact of the difference in residential units delivered in the community by supporting the proposed Metro District. This baseline was used as opposed to vacant or agricultural land because the property already has an underlying residential plat and zoning. Therefore, the future use of the property will not be vacant or agricultural but residential. Therefore, comparing the project to the current state (agricultural land) would be disingenuous to the anticipated future condition. The TBLs analysis found that in many ways the proposed residential construction enabled by a Metro District is no different from the residential development currently platted and planned for the property. However, there were a few notable differences – most significant is the anticipated energy and water savings from the standard of construction proposed and the inclusion of 50 affordable units. The results of the TBLs reflect this marginal difference between the baseline and the proposed Project. M EMORANDUM To: Josh Birks and Patrick Rowe Economic Health & Redevelopment, City of Fort Collins From: Dan Guimond and Elliot Kilham Economic & Planning Systems Subject: Waterfield Metro District Market and Financial Review EPS #183080 Date: August 17, 2018 This memorandum summarizes Economic & Planning System’s (EPS) evaluation of the Financial Plan section of the Consolidated Service Plan (Service Plan) for the Waterfield Metropolitan Service District (District). The City is required to approve the Service Plan for a Title 32 Metropolitan District (metro district) prior to it being submitted for a vote by the electorate of the district. EPS’s third-party analysis will help inform the City’s review and approval decision as it relates to the Financial Plan. The evaluation includes a review of the market and financial assumptions underlying the application as well as the general feasibility of the District’s Financial Plan, including public revenue and bond proceed forecasts. The evaluation also reviews the proposal against City metro district policy considerations as well as the proposed public benefits of the project. Development Program Waterfield is a planned 93-acre residential development proposed by Thrive Home Builders (Developer) located on the northwest corner of E. Vine Drive and Timberline Road in North Fort Collins. The District is bounded by Vine Drive to the south; Timberline Road to the West; the Larimer and Weld County Canal to the north; and a future extension of Turnberry Road to the east, as shown in Figure 1 and Figure 2. The proposed development program currently includes 498 units of for- sale housing as well as park and open space. The development is proposed to be a “new urbanist” development with energy efficient units meeting the United States Department of Energy’s Zero Energy Ready standards. In addition, the Developer plans for 50 units to be affordable for-sale housing at 80 percent of the area median income (AMI) and for 50 units to be net zero energy buildings. Construction is expected to occur between 2019 and 2026. ATTACHMENT 5 Memorandum August 17, 2018 Waterfield Metro District Review Page 2 Figure 1 Waterfield Metro District Vicinity Map Diagram Memorandum August 17, 2018 Waterfield Metro District Review Page 3 Figure 2 Waterfield Metro District Vicinity Map Aerial The Developer provided a detailed development program to D.A. Davidson, the District’s bond underwriter, as inputs to the preliminary Financial Plan. While the program is subject to change, it does provide the basis for the estimates of bond proceeds and draft bond series offerings completed by DA Davidson and outlined in the Service Plan. The proposed development plan currently includes five different housing product options and estimated market values, as shown in Table 1: • 89 3-story townhomes with a projected market value of $380,900 • 80 single family detached homes with a projected market value of $510,900 • 200 cottage homes with a projected market value of $441,900 • 101 2-story townhomes with a projected market value of $359,000 • 28 duplexes with a projected market value of $410,000 Table 1 Proposed Development Program and Market Values Description Units % Total Market Value 2017 $ 3-Story Townhome 89 18% $380,900 Single Family Detached 80 16% $510,900 Cottage 200 40% $441,900 2-Story Townhome 101 20% $359,900 Duplex 28 6% $410,900 Total / Weighted Avg. 498 100% $423,709 Source: D.A. Davidson; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 4 The Developer plans to begin platting Waterfield so that the first finished lot is completed in 2019. The buildout or vertical construction of Waterfield is proposed to take place over a seven year period from 2020 to 2026 at an average of 71 units per year, as shown in Table 2 and Figure 3. The majority of the units are proposed to be developed in the first three years between 2020 and 2022, including all of the 2- and 3-story townhomes, duplexes; all but eight of the single family homes (72 units); and a little less than half of the cottages (90 units). In 2022, the Developer proposes to build the remaining single family homes (8 units) and, from 2023 to 2026, build the rest of the cottages (110 units). Table 2 Proposed Waterfield Buildout Figure 3 Proposed Waterfield Buildout Description 2018 2019 2020 2021 2022 2023 2024 2025 2026 Total Avg. [1] 3-Story Townhome 0 0 36 36 17 0 0 0 0 89 13 Single Family Detached 0 0 24 24 24 8 0 0 0 80 11 Cottage 0 0 30 30 30 30 30 30 20 200 29 2-Story Townhome 0 0 36 36 29 0 0 0 0 101 14 Duplex 0 0 28 0 0 0 0 0 0 28 4 Total 0 0 154 126 100 38 30 30 20 498 71 [1] Average from 2020-2026. Source: DA Davidson; Economic & Planning Systems 154 126 100 38 30 30 20 0 20 40 60 80 100 120 140 160 180 2020 2021 2022 2023 2024 2025 2026 Units Total Average Source: DA Davidson; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 5 Metro District Proposal Summary The Service Plan includes three separate districts: two financing districts (District No. 1 and No. 2) and a service district (District No. 3). The financing districts will have the ability to impose an aggregate maximum mill levy of 50 mills. Of this aggregate levy, the District can impose an Operating Mill Levy not to exceed 10 mills, and a Debt Service Mill Levy that is the difference between the maximum aggregate and the Operating Mill Levy—or a minimum of 40 mills. The Service Plan allows for adjustments to the mill levies in the event that there are changes to the method of calculating assessed value or any other changes impacting the revenue generating capabilities of the District. In such cases, the District may increase or decrease mill levies to ensure that actual revenues generated are not diminished. This ability helps to further guarantee future revenue streams and reduce the risk for the bond holders. In addition to the mill levies, the Service Plan allows the District to impose a one-time facility fee of no greater than $10,000 per unit (or per end user) as a source of revenue for the repayment of debt. The Debt Service Mill Levy as well as the one-time fees are expected to be used to finance public improvements listed in Exhibit D of the Service Plan. The Developer’s engineering consultant estimates that the total cost of the public improvements will be approximately $44 million. The Developers anticipates issuing $22 million in debt or approximately 50 percent of total cost to fund these public improvement costs. Policy Review The City is currently considering updating its policy originally adopted in 2008 for reviewing proposed metro district service plans. The new policy proposes to remove previous limitations for metro district to be 90 percent commercial and not to be used to fund “basic infrastructure improvements normally required from new development”. In their place, the policy would require developers to deliver extraordinary public benefits to the city. In addition, the new policy increases the recommended “maximum mill levy” for both debt service and O&M to 50 mills—up from 40 mills in the 2008 resolution. The proposed Waterfield maximum aggregate District Mill Levy of 50 mills is greater than the previous recommended mill levy maximum, but equal to the proposed updated mill levy maximum. The Public Benefits section of this memorandum describes the proposed public benefits that the Developer is offering in more detail. Market Assessment This section reviews market values and absorption assumptions used by D.A. Davidson to estimate the potential public financing revenues and debt capacity of the project. Market Values To help determine their reasonableness, EPS compared the market value assumption used the in the Service Plan’s debt capacity estimates with recent sales in Fort Collins. In addition, EPS compared Waterfield’s proposed market values with other comparable developments in the Fort Collins area. Memorandum August 17, 2018 Waterfield Metro District Review Page 6 Recent Sales The Developer’s proposed market values generally fall near the central tendency of recent sales in the Fort Collins market. The Fort Collins Board of Realtors’ (FCBR) reports that the average price of a single family home sold in Fort Collins was $457,002 in 2018, and the average price for a townhome/condo was $304,778 for the same time period, as illustrated in Figure 4. • Single Family: The market values for the single family homes in the proposed development are $510,900 or 12 percent higher than the average of recent sales. The market average sales price includes both new construction sales and sales of older, existing homes. A premium for new construction in Waterfield is to be expected. In EPS’s professional experience, a 12 percent premium for the new construction sales is within an acceptable range. • Cottages: The market values for the proposed cottages is $441,900 or 3 percent lower than the average of recent single family home sales. The cottages in Waterfield likely will be smaller than typical single family homes, and thus will have a slightly lower price point. • Townhomes: The market value for the 2- and 3-story townhomes are $359,900 and $380,900 or between 18 percent and 25 percent higher than the market average of recent sales in the Fort Collins market. Again, as with the single family homes, new construction in the proposed development will trade at a premium to the average of new and existing homes sales. • Duplexes: The market value for a duplex in the development is proposed to be $410,900. This market value is 10 percent less than the average for recent single family homes sales and 35 percent more than the average of recent townhome sales. This value generally falls within EPS’s expectation of the relative pricing for duplexes compared to townhomes and single family homes. Figure 4 Proposed Waterfield Market Values Compared to Average Prices in Fort Collin’s Market $380,900 $510,900 $441,900 $359,900 $410,900 $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 3-Story Townhome Single Family Cottage 2-Story Townhome Duplex 2017 $ Service Plan Waterfield Weighted Avg. Average Single Family Average Townhome/Condo Source: DA Davidson; FCBR; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 7 North Fort Collins Projects This section compares the proposed Waterfield development to other recent, for-sale residential projects in the North Fort Collins market area. This comparison reveals that Waterfield’s price points largely overlap with the price ranges of recent residential projects and, more specifically, are at a mid-price point compared to recent developments, as shown Table 3 and Figure 5. At a proposed 498 units, Waterfield is of similar size to the other larger recent residential development projects in Fort Collins, including Old Town North and East Ridge. Table 3 Comparable For-Sale Residential Projects in the North Fort Collins Market Figure 5 Price Range in Comparable Residential Projects and Waterfield Project Status Project Start Product Units Price Compable Projects Single-Family $350,000-$650,000 Townhomes $300,000-$430,000 Condos $230,000-$450,000 Single-Family 18 $540,000-$570,000 Townhomes 37 $327,500-$360,000 Timbervine Under Construction 2017 Single-Family 146 $346,000-$390,000 East Ridge Approved --- Single-Family 568 $300,000-$400,000 Brownes on Howes Complete 2016 Townhomes 6 $850,000-$1,000,000 Townhomes at Library Park Under Construction 2017 Townhomes 10 $1,195,000-$1,500,000 Waterfield Single-Family 280 $441,900-$510,900 Townhomes 190 $359,900-$380,900 Duplex 28 $410,900 *Total housing units for all product types Source: Zillow; FCBR; DA Davidson; Economic & Planning Systems 450-500* Revive Under Construction 2015 Proposed Development Proposed 2018 Old Town North Third Phase 2007 $0 $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 $1,400,000 $1,600,000 Old Town North Revive Timbervine East Ridge Brownes on Howes Townhomes at Library Park Waterfield Price Range Source: Zillow; FCBR; DA Davidson; Economic & Planning Systems Waterfield Weighted Average Memorandum August 17, 2018 Waterfield Metro District Review Page 8 Absorption EPS compared the planned buildout to forecasted future demand for specific housing products estimated as part of EPS’s work on the update to Fort Collins City Plan. EPS organized these estimates into low density (single family homes), middle density (2- to 20-unit buildings), and high density (20 or more unit buildings). (More detailed information on EPS’s housing demand estimate is shown in Table 5.) Based on this comparison, EPS calculated an implied capture rate by Waterfield to gain a perspective on the relative size and reasonableness of the proposed building plan. From 2016 to 2040, EPS estimates that there will be a demand of 570 low density units and 254 middle density units per year, for a total annual average of 824 units. In comparison, the Developer proposes to build out Waterfield at an average of 40 low density homes (including single family homes and cottages and 31 middle density units (including townhomes and duplexes) per year for a total annual average of 71 units per year. This development schedule implies a capture rate of 7 percent for low density products and 12 percent for middle density. In total, the proposed schedule implies a 9 percent capture rate. Ultimately, Waterfield’s ability to meet this implied capture rate will depend on the size of the pipeline as well as its competitive position compared to other projects in the market. In our experience, EPS finds that a capture rate of 9 percent is a reasonable target for the development. The fact that North Fort Collins is one of the few remaining growth areas of the city is also supportive of the proposed development’s ability to capture forecasted growth. Table 4 Waterfield Development Implied Future Capture Rate Table 5 Fort Collins City Plan Future Housing Demand Estimates Waterfield Fort Collins Waterfield Description Average Annual Avg [3] Capture % [4] 2019-2025 2016-2040 Low Density [1] 40 570 7% Middle Density [2] 31 254 12% Subtotal 71 824 9% [1] Based on definitions from the CityPlan estimate, low density housing includes Single Family and Cottages. [2] Based on definitions from the CityPlan estimate, middle density includes Tow nhomes and Duplexes. [3] Annual average from CityPlan housing demand forecast completed by EPS. [4] Capture % = Waterfield Average / Fort Collins Average. Source: Economic & Planning Systems 2016 2040 Description Amount % Total Amount % Total Total Ann. # Ann. % Low Density 42,254 66% 55,926 59% 13,672 570 1.2% Middle Density 14,891 23% 20,998 22% 6,108 254 1.4% High Density 6,590 10% 17,296 18% 10,706 446 4.1% Total 63,735 100% 94,220 100% 30,485 1,270 1.6% Source: Economic & Planning Systems 2016-2040 Memorandum August 17, 2018 Waterfield Metro District Review Page 9 Financial Analysis The Service Plan proposes to use the stream of revenues raised from mill levies and one-time facility fees to issue debt in the form of bonds. These bond proceeds will be used to reimburse the Developer for public improvement costs. This section reviews proposed public improvement costs and the revenue and debt estimates described in the metro district Service Plan. Public Improvement Costs Northern Engineering provided the public improvement cost estimates used in the Service Plan. Overall, public improvements associated with the development are estimated to equal approximately $43.9 million, as shown in Table 6. Basic infrastructure that would typically be required is estimated to be $37.3 million or 85 percent of the total public improvement costs. Non-basic infrastructure that provides more of a public benefit comprises $6.6 million or 15 percent of total public improvements costs. Non-basic infrastructure may include more regional roadway improvements; non-potable waterline improvements; and sanitary sewer improvements. The Developer proposes to issue approximately $22 million in metro district debt to help fund infrastructure improvements, as shown in Table 6. This debt would cover 51 percent of the total proposed public improvements costs. The Developer will need to cover the remaining costs with other funds. Table 6 Estimated Public Improvement Costs Description Basic Non-Basic Total % Public Improvements Costs Grading/Miscellaneous $7,228,074 $0 $7,228,074 16% Roadway Improvements $6,429,511 $2,921,814 $9,351,325 21% Potable Waterline Improvements $1,730,880 $723,296 $2,454,176 6% Sanitary Sewer and Subdrain Improvements $3,219,298 $671,088 $3,890,386 9% Storm Drainage Improvements $1,865,183 $0 $1,865,183 4% Non-Potable Irrigation Improvements $0 $0 $0 0% Open Space, Parks and Trails $3,841,730 $0 $3,841,730 9% Admin./Design/Permitting/Etc. $6,810,000 $1,210,000 $8,020,000 18% Subtotal $31,124,676 $5,526,198 $36,650,874 83% Contingency (20%) $6,224,936 $1,105,240 $7,330,176 17% Total $37,349,612 $6,631,438 $43,981,050 100% Metro District Impact District Project Funds $22,429,750 51% Other Funds $21,551,300 49% Public Improvement $43,981,050 100% Source: Northern Engineering; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 10 Revenue Estimates Proposed Mill Levies and Facility Fee The proposed maximum District Mill Levy of 50 mills is relatively common and within the distribution of similar metro districts in Colorado. It is also equal to the updated recommended maximum mill levy for metro districts proposed by the City. The existing property tax mill levy is 90.828 mills. The District would increase the total property tax burden by 55 percent. Overall, the maximum mill levy would result in a total average monthly cost of $127 per month per residential unit, as shown in Table 7. In addition to the District Debt Mill Levy, the Developer will impose a one-time facility fee of $10,000 for each unit type. These facility fees are also pledged to debt and essentially increase the price of the development products. Table 7 Metro District Mill Levies Public Revenue Forecasts D.A. Davidson, the District’s external financial advisor, estimates that the metro district will general a total of approximately 50 million in revenues from Debt Mill Levy collections, Special Ownership Taxes, and Facility Fees, as shown in Table 8. The market value and absorption assumptions described in the Market Assessment section of this memorandum are the main drivers of these revenue estimates along with assumptions about price appreciation. EPS independently modeled and confirmed these public revenue estimates, which will be generated through 2060 and used by the District to issue bonds. As will be described in more detail in the next section, these public revenues will be used to generate approximately $22 million in projects that can be used to reimburse the Developer for infrastructure expenditures related to the public improvements. Market Assessed Property Tax District Description Value Value Existing District Total Monthly Cost 7.20% 90.828 mills 50.000 mills 140.828 mills Residential Unit Single Family $510,900 $36,785 $3,341 $1,839 $5,180 $153 Cottage $441,900 $31,817 $2,890 $1,591 $4,481 $133 Duplex $410,900 $29,585 $2,687 $1,479 $4,166 $123 3-Story Townhome $380,900 $27,425 $2,491 $1,371 $3,862 $114 2-Story Townhome $359,900 $25,913 $2,354 $1,296 $3,649 $108 Weighted Average $424,800 $30,586 $2,778 $1,529 $4,307 $127 % Total 64% 36% 100% Source: DA Davidson; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 11 Table 8 Waterfield Metro District Revenue Forecasts Bond Proceeds D.A. Davidson estimated the potential public finance revenues and bond capacity for Waterfield, which are reported in the Financial Plan of the Service Plan. In the Financial Plan, D.A. Davidson proposes to sell two series of bonds, as shown in Table 9. The first series will be issued in 2020 and generate approximately $13.7 million in project funds. The second series will be issued in 2030 and will be used to pay-off the outstanding debt service in the Series 2020 issuance, and then generate an additional $9.4 million in project funds. Together, D.A. Davidson estimates that the issuances will generate $23.1 million in project funds—covering, and even slightly greater than, the Developer proposed maximum debt issuance. A reduction in the proposed market values for the residential and commercial development would reduce the total bond proceeds. An extended buildout and absorption schedule would also reduce the value of the total bond proceeds. The underwriting process and bond structure includes reserve funds and capitalized interest to help mitigate differences between forecasted and actual values relating to market values, buildout schedule, and other variables. Table 9 Estimated Bond Proceeds Description Amount % Total Debt Mill Levy Collections [1] $42,691,916 85% S.O. Taxes Collected $2,561,515 5% Facililty Fee $4,980,000 10% Total Revenue $50,233,431 100% [1] Assumes a collection rate of 98 percent. Source: DA Davidson; Economic & Planning Systems Description Series 2020 Series 2030 Total Bond Proceeds $15,655,000 $20,930,000 $36,585,000 Other Funds [1] -$1,367,229 $2,917,229 $1,550,000 Refunding Deposits [2] $0 -$14,155,250 -$14,155,250 Cost of Issuance -$300,000 -$200,000 -$500,000 Underwriter's Discount -$313,100 -$104,650 -$417,750 Project Funds $13,674,671 $9,387,329 $23,062,000 [1] Debt reserves and other funds available. [2] Refinancing previous bond series. Source: DA Davidson; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 12 Public Benefits The City’s proposed policy for reviewing metro districts supports the formation of a district “where it will deliver extraordinary public benefits that align with the goals and objectives of the City”. The proposed policy goes on to define four focus areas or types of benefits that meet this policy as follows: • Environmental Sustainability Outcomes – defined as public improvements that provide environmental benefits including reduction in greenhouse gases, water or energy conservation, community resiliency against natural disasters, renewable energy capacity, and/or other environmental outcomes. • Critical Public Infrastructure – public improvements that address significant infrastructure needs previously identified by the City. • Smart Growth Management – public improvements that facilitate design that increases development density, enhances walkability, increases the availability of transit or multimodal facilities, and/or encourages mixed use development patterns. • Strategic Priorities – public improvements that address City priorities including affordable housing, infill or redevelopment, and economic health improvements (e.g., job growth business retention, or construction of a missing economic resource). The Developer has identified a total of $30.8 million in public improvements grouped in categories responding to the proposed metro district policies as shown in Table 11 at the end of this section. The majority of the improvements appear to meet the policy goals outlined above including the Water and Energy Conservation Investments, Multimodal Transportation (including Walkability and Pedestrian Friendliness), Public Spaces and Affordable Housing Subsidy which together total $24.4 million. It is more difficult to determine if the Critical Public Infrastructure cost items, including ROW for Suniga and Vine and LeMay improvements, are extraordinary or would otherwise be required under a development agreement. Similarly, it is unclear whether the on-site infrastructure improvements listed under High Quality and Smart Growth Management (including alleys and utilities for smaller lots) qualify as extraordinary public investments. Specifically, the lot revenues for smaller lots would be expected to be more than offset the additional on-site infrastructure costs. These more questionable benefits total $6.4 million. Memorandum August 17, 2018 Waterfield Metro District Review Page 13 Table 10 shows the programmatic public benefits of the new plan compared to the old plan. The new plan includes 498 units, which is 108 units more than the old plan. This increased density would fall under smart growth management benefits promoted by the City. The new plan also includes 50 affordable units, which is one of the City’s strategic priorities. Finally, falling under the category of an environmental sustainability public benefit, the proposed units are more energy efficient than the old plan, including 50 net zero units. Table 10 Proposed Programmatic Public Benefits Old Plan New Plan Description Amount % Total Amount % Total Difference Total Units 390 100% 498 100% 108 Affordability Market Rate 0 0% 448 90% 448 Affordable 0 0% 50 10% 50 Energy Efficiency Zero Energy Ready Units 0 0% 498 100% 498 Net Zero Units 0 0% 50 10% 50 Source: Thrive Homebuilders; Economic & Planning Systems Memorandum August 17, 2018 Waterfield Metro District Review Page 14 Table 11 Developer Public Benefit Estimate Description Per Unit Total Notes Water and Energy Conservation DOE Zero Energy Ready & EPA Indoor Air Plus [1] $28,135 $14,039,185 All homes LEED Certified [2] $400 $199,600 Delivery of 10% Net Zero Energy [3] $47,540 $2,376,995 50 units and/or distributed storage Delivery of 10% rooftop solar $8,600 $430,000 50 units and/or distributed storage Subtotal $84,675 $17,045,780 Multimodal Transportation Buffered Bike Lane $286 $142,923 ROW Land Cost - Suniga Wider than Required Sidewalks $90 $45,134 ROW Land Cost - Suniga Enhanced Pedestrian Crossing $50 $24,840 2 proposed crossings on Suniga, 6 ft wide each Subtotal $426 $212,897 Critical Public Infrastructure Major arterial development $490 $244,474 ROW Land Cost - Suniga Vine and Lemay [4] $800 $160,000 Subtotal $1,290 $404,474 High Quality and Smart Growth Management Alley Construction [5] $3,324 $1,658,818 All units Smaller lot size $8,755 $4,368,740 Additional utility, water dedication Subtotal $12,079 $6,027,558 Walkability & Pedestrian Friendliness Trail system enhancements [5] $4,207 $2,099,520 Wetland perimeter trail, paseos Subtotal $4,207 $2,099,520 Public Spaces Pocket parks, neighborhood parks, mixed use open space [6] $3,491 $1,742,210 Green courts, community plaza, pocket parks Affordable Housing [7] $65,000 $3,250,000 10% of homes at 80% of AMI Subtotal $68,491 $4,992,210 TOTAL $171,168 $30,782,439 [1] Compared to 2015 code per Rip Reid study [2] Thrive's added cost for LEED Certified [3] 3.5 kW system [4] Difficult to quantify pending APF policy determination. Based on an estimated value for units above w hat w as already approved for APF. [5] As per Exhibit D by Northern Engineering [6] As per Exhibit D by Northern Engineering (Open Space & Signage) [7] $65,000 per unit subsidy for 50 units Source: Economic & Planning Systems C:\Users\leytcheson\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\HFX6YFZQ\[183080-Waterfield Public Finance-08-14-2018.xlsx]T-Public Benefits Summary DISCLAIMER: Preliminary estimates designed to provide illustrative representation for value of public benefit. This illustration is non-binding pending execution of a Development Agreement. Memorandum August 17, 2018 Waterfield Metro District Review Page 15 Summary and Conclusions • The proposed maximum aggregate mill levy of 50 mills exceeds the maximum mill levy of 40 mills in the current metro district policy but is equal to the proposed maximum mill levy of 50 mills in the proposed new policy. • EPS generally finds that the market values and absorption assumptions used in the public revenue estimates to be reasonable. These assumptions align with market averages, given a new construction premium, and are comparable to other recent developments in North Fort Collins. Based on historic permitted and future projections, the proposed buildout implies approximately a 9 percent capture rate, which EPS finds to be a reasonable target. • The Financial Plan identifies $37.35 million of basic (in-tract) infrastructure costs and $6.63 million of non-basic (off-site) infrastructure costs totaling $43.98 million. The proposed metro district would generate $22.43 million in available revenues, reimbursing the Developer for approximately 50 percent of total infrastructure costs. • EPS independently verified the public revenue estimates. The relatively conservative market value and absorption assumptions used by the Developer help to ensure that the public revenue and debt targets are achievable. In turn, this helps to ensure that there will be funding available to pay for basic public improvements, allowing the Developer to fund the added public benefits. • The Developer has identified a total of $30.8 million in public benefits within the project. EPS has estimated that $24.6 million of the improvements for Energy Conservation Investments, Multimodal Transportation (including Walkability and Pedestrian Friendliness), Public Spaces and Affordable Housing Subsidy appear to meet the City’s proposed metro district qualifications for extraordinary public investments. These benefits exceed the $22.4 million in infrastructure costs offset by the metro district revenues. • The Service Plan does not guarantee the delivery of public benefits. Public benefits will have to be vetted and guaranteed through additional approval steps for the metro district, including approval of the development plan. Attachment 6 - Combined Vicinity Map Shows all three proposed Metro Districts in the Northeast portion of Fort Collins Legend Montava Waterfield Water's Edge Phase 1 Water's Edge Phase 2 2 mi N ➤➤ N © 2018 Google © 2018 Google © 2018 Google 80% AMI Yearly Income Monthly Income Income available for housing (38%) HOA ($200/mo) Property Taxes (.072%) Insurance (.038%) Target Monthly Mortgage Payment Down Payment (4% FHA) Loan Amount Interest Rate (5% Annual) Loan Maturity (30 Years) Future Loan Value Home Value PMT Check Formula 3 Person Household $ 61,300.00 $ 5,108.33 $ 1,941.17 $ 200.00 $200.47 $105.80 $ 1,434.89 $11,137 $267,293 0.417% 360 0 $278,430 ($1,434.89) 2 Bedroom Unit 4 Person Household $ 68,100.00 $ 5,675.00 $ 2,156.50 $ 200.00 $225.26 $118.89 $ 1,612.35 $12,515 $300,350 0.417% 360 0 $312,865 ($1,612.35) 3 Bedroom Unit 100% AMI Yearly Income Monthly Income Income available for housing (38%) HOA ($200/mo) Property Taxes (.072%) Insurance (.038%) Target Monthly Mortgage Payment Down Payment (4% FHA) Loan Amount Interest Rate (5% Annual) 2018 Income Limits Income Limits (effective date: TBD) 2018 Median Income: $85,100 (Fort Collins/Loveland Metropolitan Statistical Area) City of Fort Collins Household Members Income 1 2 3 4 5 6 7 8 100% AMI $59,600 $68,100 $76,600 $85,100 $92,000 $98,800 $105,600 $112,400 80% of AMI* $47,700 $54,500 $61,300 $68,100 $73,550 $79,000 $84,450 $89,900 60% of AMI $35,760 $40,860 $45,960 $51,060 $55,200 $59,280 $63,360 $67,440 50% of AMI* $29,800 $34,050 $38,300 $42,550 $46,000 $49,400 $52,800 $56,200 30% of AMI* $17,900 $20,450 $23,000 $25,550 $29,420 $33,740 $38,060 $42,380 AMI = Area Median Income 51-80%: Low Income Limit (HOME High Income Limit) 31-50%: Very Low Income Limit (HOME Low Income Limit) 0-30%: Extremely Low Income Limit *80%, 60%, 50% & 30% are the HOME income limits published by HUD. These are the income limits required for projects funded with CDBG & HOME. Revised May 3, 2018 ATTACHMENT 8 Thrive Homebuilders Waterfield Community, Fort Collins, Colorado September 4th, 2018 City Council Meeting, Concerns and Comments Council Concern: Area is not well served by retail, hospitals, etc. Response: Due to the underdeveloped characteristics of the surrounding areas, primarily the industrial and agricultural lands in the Northeast portion of Fort Collins, the area may feel a bit isolated but it is actually closer to retail services than perceived. The Mulberry and LeMay Crossing shopping center (anchored by Walmart & Home Depot) is less than 2.2 miles away. The UC Health Poudre Valley Hospital is only 3.2 miles away. Colorado State University is 4 miles from the community with the center of Old Town Fort Collins approximately 2.8 miles away. Waterfield is closer to some services than the popular Harmony Road corridor but with a more convenient location to both the University and Downtown areas of Fort Collins. Council Concern: Council would like a better explanation of the affordability component of the community as well as Net Zero Energy Homes. Response: Thrive Homebuilders is committed to providing affordable homes in Waterfield. 1. See the chart of expected housing prices and square footages for 80%-120% AMI. This is not a guarantee but an indication of our plan to address the “missing middle” of housing affordability. 2. Our commitment is to deliver 80% of AMI homes by the following means: a. Developing a specific compliance plan prior to execution of a Development Agreement (to be approved by City Council). b. Collaborating with other Mountain Vista developers, the City of Fort Collins, Housing Catalyst, a Community Land Trust and/or Habitat for Humanity to develop a replicable and consistent affordable housing policy. c. The specific outcome is 10% of our housing sold to 4-person households at or below 80% AMI (as it may adjust in the future) for an affordability period of 20 years. d. The specific means of providing 20 year affordability may be influenced by the collaboration described in item b above or the provision of a deed restriction if necessary based upon contributions from the stakeholders that are necessary to achieve Ft. Collins’ affordable housing goals. 3. Currently Ft. Collins’ 2018 80% of AMI for a 4-person household is $68,100. At Ft. Collins’ approved housing burden of 38% of income, $2,156.50 is available for PITI+HOA or Metro District fees. The maximum principal and interest payment is $1,632.35 after deducting taxes, insurance and HOA or Metro District fees. With a 4% FHA down payment and a 5% interest rate, the maximum home price is $312,865. ATTACHMENT 9 4. Our experience in Stapleton is that you cannot price your homes at the maximum amount. Pricing needs to be lower to attract a large enough pool of potential home buyers to insure success of the program. For example, we would propose pricing of a 3-bedroom unit for a 4- person household at $280,000. This will adjust annually based on sales pace, success in qualifying home buyers for loans and adjustment of the Area Median Income as set by the US Department of Housing and Urban Development. For a summary on Zero Energy Homes, please refer to the attached letter from Mr. Sam Rashking, Chief Architect, US Department of Energy Building Technologies Office. Council Concern: Council would like assurances that there is a proper notification of the Metro District to all potential buyers. Response: Thrive Homebuilders is committed to properly notifying all potential buyers of the Metro District and will comply with Colorado State Statute 32-1-104.8 Information statement regarding taxes and dept. A copy is attached for reference. Please also note that the Metro District Service Plan, Paragraph E. Disclosure to Purchasers on page 14, also covers the subject of proper notification. A full copy is attached for reference. Council Concern: Council would like to understand the impact that zero energy homes have on the power company and the demand to the grid. Response: Most Net Zero Energy Buildings are still connected to the electric grid, allowing for the electricity produced from traditional energy sources (natural gas, electric, etc.) to be used when renewable energy generation cannot meet the building's energy load. When, conversely, on-site energy generation exceeds the building energy requirements, the surplus energy will be exported back to the utility grid. The excess energy production offsets later periods of excess demand, resulting in a net energy consumption of zero. Due to current technology and cost limitations associated with energy storage, grid connection is usually necessary to enable the Net Zero Energy balance. Effects on the grid are complex. Thrive Homebuilders has obtained the partnership of the National Renewal Energy Laboratory to analyze grid effects with Thrive and the City of Fort Collins. Council Concern: Council would like to quantify the benefits of the Metro District Response: The Waterfield Metro District allows for the infrastructure of the Waterfield Community to be amortized over time. It is this amortization of the infrastructure costs that enables Thrive Homebuilders to offer newly construction homes at a lower initial price point than if the infrastructure costs were originally factored into the total cost of the home. With an existing mill rate of 90.828 over a projected 500 homes at completion, this equates to an increased tax revenue of $1,389,000 per year. This is new revenue for schools and services already dependent on property taxes. The Metro District’s contribution to the development of the community also allows for the public benefit of items as listed in Exhibit H which include increased Water & Energy conservation, Multimodal Transportation, Critical Public Infrastructure, High Quality & Smart Growth Management, as well as the promotion of Pedestrian Friendly, Public Spaces and Affordable Homes. When compared to the 2015 IECC, Thrive Homebuilder’s increased energy efficient construction practices and methodologies are calculated to save over 1,115 Tons in CO2 Emissions. This is equivalent to over 2.5 million miles driven. In addition to the above, Thrive Homebuilders is also restoring approximately 5.4 acres of Natural Habitat Zone on the Western side of the community, which will be accessible via a nature boardwalk trail as the community contribution to the Nature in the City program. We are also in the process of working with arborists to create an interconnected system of native-habitat plant species that promote bio diversity throughout the community. DOE Zero Energy Ready Home www.buildings.energy.gov/ZERO Zero Energy Ready Home Development in Fort Collins Sam Rashkin, Chief Architect, U.S. DOE Building Technologies Office September 10, 2018 What is Zero Energy Ready Home: Top 1% highest performance homes nationwide ~20% greater efficiency than 2015 IECC along with requirements for ensured comfort, water protection, and indoor air quality. Performance measures included are often missing in code homes which can lead to failures. Zero Energy Ready Home Benefits for Fort Collins: Benefit calculations are based on the following data/analytical findings: - ~5,500 units committed to 100% Zero Energy Ready Home (Thrive Home Builders and Mantava development) - $400 annual energy savings per home compared to 2015 IECC home - 7.2% annual residential property tax rate for Fort Collins - 1 Kw peak demand reduction per home Benefits to Fort Collins for ~5,500 homes projected over first 30-year mortgage include: - ~$60 million energy savings that can be spent locally in the community - ~$45 million of additional tax revenue attributed to higher value homes - ~.5 billion gallons of water saved going down the drain waiting for hot water - ~5,500 Kw peak demand reduction for City of Fort Collins - Utilities - ~15,000 residents with less sick days and lower medical expenses - 17+ million tons CO2 emission reductions - 2030 Carbon Neutral Goal readiness with full infrastructure development (e.g., trade skills, builder experience, product distribution) at no expense to Fort Collins Zero Energy Ready Home Empirical Results Nearly 3,000 homes certified Certifications doubled for 3 straight years ~10,000 homes committed to future certification ~200 home profiles in DOE Tour of Zero demonstrate outstanding performance Oregon Governor’s executive order calls for ZERH in 2023 code ATTACHMENT 10 State of Colorado State Statute – Metro District Disclosure Requirement ATTACHMENT 11 Metro District Service Plan Disclosure Language Efficient. Healthy. Local. 1875 Lawrence St. | Suite 900 | Denver, CO 80202 303.707.4400 ThriveHomeBuilders.com DATE: January 11, 2018 SUBJECT: Letter of Commitment SETO National Laboratory Call Dear Dr. Xin Jin, Thrive Home Builders is pleased to support NREL’s proposal entitled, “Artificial Intelligence- Driven Smart Community Control for Accelerating PV Adoption and Enhancing Grid Resilience” and to participate as a sub-tier partner in response to the Subject opportunity. Our contribution to the project in summary is to support field demonstration and to provide allowable in-kind cost share over the duration of the project. Upon award, we fully anticipate entering into the necessary agreements with the NREL as the Prime awardee and will provide all resources as defined in our scope of work, budget, and proposal documents for the project’s duration. Thrive Home Builders involvement in field demonstration is dependent upon on the successful purchase and development of land. Our organization is well-aligned with the goals of the proposed project. We look forward to a successful project and productive relationship as we have demonstrated by our past accomplishments. I look forward to collaborating with you on this work and best of luck. Sincerely, TH Waterfield LLC By: NT Builders LLC, its manager Jeffery P Seibold, Manger ATTACHMENT 12 SETO National Laboratory Call DE-LC-000L044 Multiyear Project Proposal Cover Page Title of Proposal Artificial-Intelligence-Driven Smart Community Control for Accelerating PV Adoption and Enhancing Grid Resilience Project Focus Areas System Integration, Solar Plus Energy Storage and Synergistic Technologies, Grid Reliability, and Grid Resilience Specific Multiyear Goals 3.a and 3.b Abstract We propose to develop and demonstrate a community-scale solution which increases the solar photovoltaic (PV) penetration to 100% of the community’s annual load consumption, significantly reduces the impact of solar variability on the distribution voltage, and provides at least 5-day critical load support during emergency events. Our approach is powered by novel artificial intelligence (AI) methods which create detailed building models from smart meter data, identify homeowner preferences, and enable day-ahead planning of various resources within the community. We will extend NREL’s prior efforts on home energy management, PV hosting capacity, and device characterization for grid services to address the challenges in community-scale coordination of behind-the-meter PVs and other distributed energy resources. We will fully utilize the potential of flexible building loads and battery storage to maximize PV self-consumption within the community. We will perform techno-economic analysis to identify the minimal sets of devices for new and existing communities to achieve the goals of net zero capacity and 5-day critical load support. The project responds to SI Topic 4 (Solar + X) and helps overcome challenges in MYPP 3.a reverse power flow and MYPP 3.b ineffective utilization of flexible loads and energy storage with solar. Principal Investigators Xin Jin (PI), NREL, 303-275-4360, Xin.Jin@nrel.gov Fei Ding (Co-PI), NREL, 303-396-3685, Fei.Ding@nrel.gov Team Members Nathan Kahre, Thrive Home Builders, nkahre@thrivehomebuilders.com John Phelan, Fort Collins Utilities, jphelan@fcgov.com Kedar Dimble, A.O. Smith, rdimble@aosmith.com Key Participants Kandler Smith, Lieko Earle, Bethany Sparn (NREL), Bill Hoskin (A.O. Smith) Budget Summary Cost Categories FY2019 FY2020 FY2021 Total Labor Supplies & Direct Cost (includes Work w- National Labs) Travel Subcontracts Other Costs (Service Center Recharge & Applied Indirect Cost) Total Estimated Costs Cost Share (In-kind equipment and labor from Thrive Home Builders) 600,000 Project Grand Total Commented [DF1]: [Include a high-level overview of estimated project budget. Listing an estimated breakdown for each proposed year, separated by teaming partners and high-level activities Individual line item costs within high level activities (i.e. within staff time breaking out by employee 1, employee 2, etc.) are not required. A detailed project budget will be completed during negotiations. The high level cost estimates should address the table categories. Commented [JX2]: Budget summary to be added. NREL will request $2,400k over 3 years from DOE. Thrive will provide 600k in-kind cost share. ATTACHMENT 13 2 1 Technical Narrative 1.1 Project Overview Scope of Work: We propose to develop and demonstrate a community-scale solution to 1) increase the PV penetration to 100% of the community’s annual energy consumption, 2) significantly reduce the impact of solar variability on the distribution voltage, and 3) provides at least 5-day critical load support during emergency events. Our approach is powered by novel artificial intelligence (AI) methods which create detailed building models from smart meter data, identify homeowner preferences, and enable day-ahead planning of various resources within the community. The project responds to SI Topic 4 (Solar + X) and helps overcome challenges in MYPP 3.a reverse power flow and MYPP 3.b ineffective utilization of flexible loads and energy storage with solar. Background: The proposed project is motivated by the trend of rapid PV adoption. As the cost of solar electricity continues to decline, solar will likely supply 10-20% of the United States’ annual electricity demand by 20301. Across the country over 50 cities have committed to achieve 100% renewable energy goals by 2030 to 2050. Zero Net Energy (ZNE) homes and communities, whose annual energy consumption is equal to annual renewable energy production, have emerged to help achieve these renewable goals. Every home in ZNE community is expected to have PV ranging from 3 to 10 kW depending on the energy efficiency measures, construction, and climate. The achievement of these ambitious footprints will transform the nation’s communities into the holistic paradigms consisting of pervasive solar PVs and other renewable distributed energy resources (DERs), energy storages and flexible loads. As shown in Figure 1, the integration of solar PVs with other synergistic technologies, known as Solar Plus Approach, can shift certain customer loads under the PV generation curve to maximize solar self-consumption and reduce grid consumption. The flexibility in energy supplies and demands, provided by the communities that are powered by solar plus approach, demonstrates attractive potential on enhancing grid reliability and resilience. Current Challenges: Utilities are faced with new challenges as PV penetration grows. During many hours of the year, electric power is flowing out of PV-enabled buildings and back into the grid. When this happens simultaneously in many nearby buildings, distribution feeder voltage can be raised significantly. Intermittent solar power can also cause voltage flickers, leading to potential damages on both distribution feeder and home appliances. PV curtailment is still commonly used to reduce reverse power flow but this challenges renewable energy economics. Battery storage has also been used to store the excess PV power. Despite the rapid decrease in battery cost, battery storage is still expensive for most homeowners. A recent study led by the PI found that flexible building loads coordinated by an energy management system may be necessary to ensure batteries are economically viable under many utility tariffs2. Also, although solar plus approach demonstrates the potential to benefit the grid, controlling massively heterogeneous behind-the-meter assets is extremely challenging and requires advanced design and control paradigms. Until now, most of existing solar plus technologies have three major limitations: 1) insufficient understanding of behind-the-meter assets; 2) immature coordination strategy for heterogeneous assets; 3) deficient grid impact analysis of solar plus technology. Behind-the-meter data monitoring has historically been a challenge due to limited sensors and meters in the distribution grid. The pervasive advanced metering 1 Solar Energy Technologies Office, Multi-Year Program Plan, FY 2018 – 2022. 2 X. Jin, J. Maguire, D. Christensen. (2018) Economic Sizing of Batteries for the Smart Home. NREL Technical Report NREL/PR-5500-70684. Figure 1 Customer load shifting through solar plus approach. Commented [JX4]: Discuss the history, successes, current state of the art in the field of the proposed work, current applicant team capability, and a concise description of the concept or scope of work. Technical Details: If necessary, succinctly describe the relevant management, engineering, design, process, scientific or other principles and aspects of the project that warrant discussion here. Criterion 1: Innovation and Impact (33%) – How innovative and impactful is the project, assuming the stated outcomes can be achieved as 3 infrastructure (AMI) has greatly alleviated the challenge, but there are still technical gaps on how to understand the device-level behavior in a home using the aggregated home-level AMI data. In addition, the coordinated control of PV inverters, energy storage and controllable load behaviors typically relies on solving nonconvex and nonlinear optimization problems, so computational scalability is a critical barrier for developing robust and mature solar plus approach. Furthermore, existing related solar plus work lacks credible use cases due to the use of simplified distribution grid model. Technical Approach: To overcome these challenges, we propose to use AI methods and develop a community-scale control system which holistically combines distributed PVs, flexible building loads and battery storage to increase PV hosting capacity, provide grid service, and support critical loads during emergencies. Figure 1 provides an illustration of the hierarchical smart community control system which consists of home energy management systems (HEMS) from individual homes and a community-level aggregator. The community control system is designed in a hierarchical way to preserve homeowner’s privacy and make the solution scalable. We will first develop high-fidelity building and appliance models using disaggregated appliance-level data from the historical AMI measurements. These models are used in the HEMS, which coordinates appliances, PVs and batteries within the home based on user preferences and provide load forecast to the community-level aggregator. No personal information of the home is provided to the aggregator or the grid to preserve privacy. The aggregator performs day-ahead planning based on the load forecast from individual HEMS and requests from the grid, and send updated reference signals to the HEMS. We will extend NREL’s prior efforts on user- centric HEMS3, PV hosting capacity4, and GMLC project on grid service from devices5 to develop the community-scale coordination control for behind-the-meter PVs. We will fully unlock the potential of flexible building loads and battery storage to maximize PV self-consumption within the community and reduce reverse power flow. We will perform techno-economic analysis to identify the minimal sets of sensing, control, and energy storage devices for new and existing communities to achieve the goals of net zero energy and 5-day critical load support. In addition to software simulations, we will validate and deploy the developed approaches using hardware-in-the-loop test and field demonstration. Team Summary: In this project, the National Renewable Energy Laboratory (NREL) will collaborate with a diverse team comprised of homebuilder (Thrive Home Builders), electric utilities (Fort Collins Utilities) and equipment manufacturer (A.O. Smith) to develop, validate and demonstrate the breakthrough solar plus approach to advance solar’s ability to enhance grid reliability and resilience. The project is planned for three years, including algorithm development and software simulations (Year 1), scenario testing and 3 X. Jin, K. Baker, D. Christensen and S. Isley, “ForeseeTM: A user-centric home energy management system for energy efficiency and demand response”. Applied Energy, vol. 205, pp. 1583-1595, Nov 2017. 4 F. Ding and B. Mather, “On distributed PV hosting capacity estimation, sensitivity study and improvement,” IEEE Transactions on Sustainable Energy, vol. 8, no. 3, pp. 1010-1020, July 2017. 5 GMLC 1.4.2 Project – “Definitions, Standards and Test Protocols for Grid Services from Device”. Figure 2. An illustration of the hierarchical smart community control system which coordinates PV, battery storage and flexible loads to reduce reverse power flow and increase grid reliability and resilience 4 hardware-in-the-loop validation at NREL’s Energy Systems Integration Facility (ESIF) (Year 2), and field demonstration in Thrive’s Waterfield Community in Fort Collins, CO (Year 3). Innovation: The proposed solution has the following unique innovations: Novel AI methods for analyzing building loads. AI-based load disaggregation technique bridges the gaps between AMI data and behind-the-meter resources, provides an alternative to expensive submetering, and enables more accurate predictions of building loads. Cost-effective approach for accelerating PV adoption and providing grid benefits. The proposed solution will leverage the improved understanding of the behind-the-meter resources and fully unlock the potential of flexible building loads to support PV application. The proposed solution will operate the existing resources optimally from a grid plus built environment perspective and only introduce minimally-sufficient sensing, control, and energy storage devices. Privacy-preserving operation of the smart community by using a hierarchical architecture in the control system. Only aggregated whole-home load estimation is communicated between the HEMS and the community-level aggregator to preserve homeowners’ privacy. No device-level load profiles or user preferences are transmitted outside the home. Versatile control architecture capable of switching operational mode seamlessly. The HEMS and aggregator are based on multi-objective optimization, which can automatically switch their objective functions in response to different grid events. Differentiation: The proposed project is distinct from other projects in the Solar/GMLC/DOE portfolio: Existing NREL Efforts: NREL’s previous user-centric HEMS project focuses on the single home control with low PV penetration, whereas the proposed project extends the scope to a community with extremely high PV penetration. GMLC 1.4.2 project aims at modeling and characterizing the capability of different device classes on providing grid services, but does not focus on developing advanced controls to manage these devices; while the proposed project is to develop the scalable smart community control to coordinate solar and other synergistic technologies. Resilient Distribution Systems (RDS) Lab Call – Grid Resilience and Intelligence Project (GRIP): Our project uses a bottom-up approach to establish high-fidelity models from AMI data, address reverse power flow challenges, and support critical loads during emergencies. The GRIP project addresses grid resilience during disruptive events and focuses less on solar and end uses. ORNL’s Connected Community Project: The ORNL project aims to develop energy management algorithms to save energy in a neighborhood, whereas our project focuses on coordinating solar with other behind-the-meter assets in ZNE communities to enhance grid reliability and resilience. Scalability: The aggregator only receives aggregated load estimation from each HEMS, and performs day- ahead planning for the community. Each HEMS solves its own optimization problem to control building equipment. Such design avoids the large amount of communication, reduces the data storage requirement at the aggregator, and alleviate the computation burden for controlling heterogeneous assets. These features will make the proposed solution scalable for controlling multiple houses and communities. The scalability of the proposed solution will be validated during the field demonstration in Thrive’s Waterfield community. 1.2 Project Objectives This project aims at accomplishing three objectives. Objective 1: Develop a cost-minimal approach to increase the community’s total PV penetration to be 100% of its annual load consumption and enable each community building to self-consume at least 80% of its annual PV generation Commented [JX6]: See Merit Review Criterions #2 in the template instructions. Provide a clear and concise (high-level) statement of the goals and objectives of the project. Each objective should be numbered (Objective 1, Objective 2, etc.). For a metric that is used throughout the project, the performance metric must improve with time/use and this should be clearly documented. This improvement over time could be demonstrated through a tightening of the precision and an improvement in accuracy. There should be objectives that retire technological and market risks. To ensure that objectives are relevant, Applicants should follow the SMART principle, which is that all objectives should be Specific, Measurable, Aggressive (but achievable), Relevant, and Timely. At a minimum annual 5 We will extend our prior efforts on user-centric HEMS3, economic battery sizing2 and PV hosting capacity4 to achieve this objective by: 1) modeling high-fidelity behind-the-meter loads, 2) estimating annual PV generation, and 3) searching for the cost-minimal solution using model-based parametric analysis. Figure 3 summarizes the approach to achieve this objective. The proposed work is designed to be applicable for both existing communities and new constructions. First, we will collect one-year historical AMI load measurements for existing home buildings, simulate one- year load consumption profiles for new constructions using EnergyPlus6, and collect one-year historical solar irradiance measurements at the community’s location from NREL’s National Solar Radiation Database (NSRDB) 7 . Then, we will use machine learning approaches to disaggregate load data and develop high-fidelity behind-the-meter load models. Our HEMS, named as foresee3, was developed to control home appliances, PV inverter and energy storage by solving a multi-objective convex optimization problem to optimize energy cost, thermal comfort, user convenience and carbon emission. We will use foresee, the high-fidelity load models and annual solar irradiance data to perform model-based parametric analysis to solve the optimal locations and sizes for new PV systems and batteries (if needed), and optimal dispatch strategy for home appliances, PV inverter output and battery charging/discharging power. The model-based parametric analysis will explore the sensitivities of flexible loads and batteries to the costs for supporting PV adoption. The solution will be cost optimal and meet two objectives simultaneously: 1) total PV penetration in the community equals to 100% of the community’s annual load consumption, and 2) each community building can self-consume at least 80% of its own annual PV generation. When solving the optimization problem, we will include resource constraints (e.g. available roof sizes, number of buildings willing to install PVs and energy storage), and cost data of different types of battery (e.g. capital cost, O&M cost). These data will be obtained from Thrive and NREL’s unit cost database. Objective 2: Develop a hierarchical control framework to reduce at least 20% adverse impact of solar variability on distribution grid voltage by providing grid service from the smart community. To achieve this objective, we will 1) develop a community-level aggregator to coordinate with multiple HEMSs by following utility grid service reference signals; and 2) deliver a use case to demonstrate the capability of the proposed solar plus approach on reducing voltage fluctuation and overvoltage by at least 20% in City of Fort Collins’s distribution feeder. Based on findings from the GMLC 1.4.2 project, it is expected that distribution system operator will provide reference signals (named as drive cycles) for device fleets to follow in order to achieve certain grid services. Thus, as shown in Figure 4, we will follow this schema and develop the community-level aggregator to solve the optimal day-ahead building-level power consumption schedules by following the drive cycles provided by distribution system operator. Then each 6 EnergyPlusTM, https://energyplus.net 7 National Solar Radiation Database (NRSRD), https://nsrdb.nrel.gov. Figure 3. The cost-minimal approach for realizing the smart community’s PV penetration and self-consumption goals. 6 HEMS will solve the 5-min granularity optimal device dispatch decision for PV inverters, batteries and flexible building loads based on the received building-level schedule using the model predictive control. In order to demonstrate the capability of the proposed hierarchical control framework on reducing the impact of solar variability on distribution grids via providing grid services, we will develop a use case to improve distribution voltage in the City of Fort Collins’s distribution feeder that is connecting with Thrive’s new community. We will study at least five scenarios by considering different PV penetration levels at other areas of the feeder and different numbers of controllable buildings in the smart community. For each scenario, we will quantify the impact of the proposed smart community control on alleviating voltage issues while satisfying customers’ comforts, and identify the solutions to reduce the amount of voltage fluctuations and overvoltages by at least 20% compared with no smart community control. Objective 3: Develop an emergency energy dispatch approach to support 5-day non-interruptive power supply for critical loads in the community, and determine the minimum number of controllable devices to respectively achieve 100% critical load supply and the highest resilience. In this proposal, the electric power used for satisfying basic life needs, including lighting, cooking, water heating, room cooling and heating, are considered as critical loads in the community. During emergencies, we assume that all rooftop PV systems in the community will supply its maximum active power, so each PV inverter will work under the unity power factor without any curtailment. Each HEMS, i.e. foresee, will provide the community-level aggregator with the estimated critical load usage, predicted solar PV generation and the stored battery energy for the next 24 hours. With these data collected from all HEMSs, the aggregator will solve the day-ahead net power consumption for each home to maximize the total critical load support benefit across multiple homes in the community, by following a constant zero power reference signal to make sure no power supply from the utility grid. Then each HEMS will solve the on/off decision for both non-critical and critical loads, and energy storage charging/discharging in the home. Compared with normal operations, during emergencies each HEMS needs to provide more information for the aggregator. In order to protect the privacy of households, the aggregator will automatically delete all received messages from HEMS after the emergency condition is cleared. In order to test the proposed approach, we will select three groups of five consecutive days randomly from a year, and analyze the performance of the proposed emergency energy dispatch approach on increasing resilience. First, we will develop a resilience metric to capture the trade-off value between total number of critical loads supported and Figure 5. A conceptual framework of evaluating the smart community’s resilience performance during 5-day isolated operation. Figure 4. The hierarchical control framework for the smart community to provide grid services. 7 total number of non-critical loads shedded, an example of which is provided in Figure 5. Then, we will simulate the proposed emergency energy dispatch algorithm and calculate the resilience metric values by studying different penetrations of controllable devices in the community. Based on the simulation results, we will identify the minimum number of controllable devices respectively for achieving 100% critical loads support and achieving the highest resilience. 1.3 Impact if Successful The project responds to SI Topic 4 (Solar + X) and helps overcome challenges in MYP 3.a reverse power flow and MYP 3.b effective utilization of flexible loads & energy storage. The first-of-its-kind deployment and demonstration of the proposed smart community-level solutions will provide ample evidence of the effectiveness of the proposed technology and will propagate benefits to the broader electric utility, solar vendors and other synergistic technology manufacture vendors. Also, this project will advance synergetic control of PVs, other DERs and flexible loads to achieve the SunShot goal. This project will be the first to introduce artificial intelligence techniques to characterize behind-the-meter assets for providing grid services and grid resilience. The accomplishment of this project will provide the following benefits: Accelerate PV adoption and support the SunShot Goal of advancing solar’s ability to support grid reliability and resilience Improve PV’s economic viability by reducing curtailment to near 0% and providing grid services during normal operation Reduce energy storage cost by 40% relative to best current practice by optimal battery sizing and life extending control Support critical loads for up to 5 days during emergency events via isolated operation of the communities with DERs only Provide guidance on design and operation of ZNE community in other part of the nation 1.4 Outreach Plan Outreach to the broad group of stakeholders interested in the project will be a critical to project success. We will use diverse strategies to engage with different target audience such as utilities, builders and academia and maximize the impact of the project. Ensuring that the project remains practically applicable to utilities is vital and will be accomplished through engagement with the Technical Review Committee (TRC). The TRC will include representatives from different divisions of our utility partner (Fort Collins Utilities), as well as selected technology vendors. Through a yearly in-person meeting and two annual webinars the TRC will be an integral portion of the project team, helping with the problem formulation, test case selection, and solution validation aspects of the project. In addition, we plan on broader outreach to both the academic community and the broader utility and builder population. This will take the form of peer-reviewed publications (IEEE Transactions on Smart Grid, IEEE Transactions on Sustainable Energy, Applied Energy, etc.) and academic conference presentations (IEEE PES General Meeting, ISGT, American Control Conference, etc.) to ensure that the methods developed are rigorous and summary publications (Home Energy Magazine, IEEE Power and Energy Society Magazine, Electricity Journal, etc.), utility-focused conference venues (DistribuTECH, UVIG, etc.) to disseminate project findings directly to the utility industry. Furthermore, we plan to outreach to stakeholders of ZNE communities to share the key learnings and help accelerate the adoption of PV and ZNE homes. This will take the form of webinars and presentations at residential building-focus conference venues such as NAHB International Builders’ Show and ACEEE Summer Study on Energy Efficiency in Buildings, etc. Commented [JX9]: See Merit Review Criterion #1 listed in the template instructions. Discuss the relevance the proposed work, if successful, will have to industry and to enhancing grid reliability and resilience and/or the cost and barrier reductions needed to reach the SunShot 2030 targets. Please address: Expected project outputs Audience/customers for the project end results How the audience will utilize the results. Commented [JX10]: Talk about why DOE funding is needed for this effort in this section or somewhere else. What is the impact of DOE funding? Commented [JX11]: Outreach plan to engage with 8 1.5 Risk Identification and Mitigation Plans Risk 1 – Availability of smart meter data: There is a risk that smart meter data is not available due to privacy issues or the data resolution is too low for algorithm development. This risk is mitigated by identifying smart meter data from other sources such as public dataset for non-intrusive load monitoring research and other utilities. Risk 2 – Scenario simulation of the distribution grid not relevant to real-world applications: There is the risk of modeling scenarios that may not be applicable to the solar variability and emergency situations that occur in reality. This risk is mitigated by including strong utility partner who will provide feeder model and historical data. Risk 3 – Long term reliability of HEMS and aggregator hardware: There is a risk that the hardware for hosting HEMS and community-scale aggregator may not be reliable over a long period of time. This risk is managed by robustness testing of the hardware in the ESIF laboratory in Year 2 to study the potential failure mode and migrating most computation to the cloud such as Amazon Web Services. Risk 4 – Budget: The project objectives are aggressive for the budget proposed. This is mitigated by our partnership with strong industry collaborators Thrive Home Builders and Fort Collins Utilities, and the “phased” or step-wise approach for development and implementation of the framework. Risk 5 – Ownership of the aggregator and community energy storage: There are not many existing examples on the ownership of the community aggregator and community energy storage. We will work closely with the homebuilder and utility partners to determine the best practice. The most likely solution is the home owner association will own and operate the community aggregator and energy storage. Commented [JX13]: Discuss items that are likely to put the proposed project goals at risk. Describe the risk and mitigation strategies. Address specific technical risks rather than general management risk. Also could discuss any closing remarks here. Commented [JX14]: Reduce to three and elaborate 9 2 Summary Technical Work Plan The technical work plan consists of 9 tasks over the 3-year period of performance. In Year 1 (Tasks 1-3), the team will focuse on modeling the smart community, developing AI methods and control architecture, and simulation study on normal operation. In Year 2 (Tasks 4-7), the team will expand the simulation platform to include a feeder model, and perform laboratory experiments to study how to control the smart community to mitigate feeder voltage issues and enable critical load support during emergency events. In Year 3 (Task 8), the team will deploy the control systems in Thrive’s Waterfield ZNE community and perform field experiments in 20 homes. As specified in Task 9, we will work closely with the TRC to actively engage with external stakeholders throughout the entire duration of the project. Task 1 – Develop AI methods to self-learn load models and homeowner preferences (M1-M6, $200,000) NREL will develop AI methods to self-learn two important aspects of home energy management: how does a home responds to controls (i.e., load models) and how would homeowners like their homes to operate (i.e., homeowner preferences). We will first develop non-intrusive load monitoring (NILM) algorithms to disaggregate major building loads from the smart meter data, and then develop data-driven dynamic models for the building envelop and major appliances using the disaggregated electric loads and smart thermostat data. We will also develop machine learning algorithms to analyze a homeowner’s preference on different objectives such as energy cost, thermal comfort and carbon emissions based on information such as the power profiles, thermostat setpoint and time of setback, occupancy, etc. Subtask 1.1 – Identify smart meter and smart thermostat data for developing the AI methods Subtask 1.2 – Develop AI methods to disaggregate smart meter data to identify electric loads Subtask 1.3 – Create resistor-capacitor networks to capture characteristics of the building envelop and major appliances such as HVAC and water heater Subtask 1.4 – Develop machine learning algorithms to learn homeowners’ preferences using disaggregated electric loads and smart thermostat data Subtask 1.5 – Verify the load disaggregation and preference estimation accuracies using ground truth data Task 2 – Determine the cost-optimal approach to self-consume PV within the community (M4-M9, $200,000) NREL will work closely with Thrive to use the best practice to estimate the total PV size the meet the ZNE requirement on the annual basis. Based on the PV size and historical solar irradiance profiles, NREL will develop a cost-optimal approach for PV self-consumption by prioritizing flexible loads and introducing minimally sufficient sensing, control and energy storage devices. Subtask 2.1 – Analyze the total PV size required for the community to meet the ZNE requirement Subtask 2.2 – Study the impact of using HEMS to dispatch flexible loads to self-consume PV generation Subtask 2.3 – Determine the optimal battery size and type and its impact to power backfeed reduction Subtask 2.4 – Develop the optimal energy dispatch strategy using HEMS with the consideration of battery lifetime Task 3 - Develop the hierarchical community control system and simulation test bed (M7-M12, $200,000) NREL will enhance the existing HEMS software to incorporate the capability of reactive power simulation and control. NREL will also develop the community-level aggregator and specify the communication protocols between the HEMS and the aggregator. A simulation test bed will be built in Python. Subtask 3.1 – Develop a simulation test bed to host a community model based on Thrive’s development plan Subtask 3.2 – Enhance the existing HEMS (foresee) by incorporating reactive power control capability Subtask 3.3 – Develop the aggregator and the coordination mechanism between the aggregator and HEMS Subtask 3.4 – Perform year-long simulation exercise to evaluate and refine the community control system Deliverable 1 (M12): A technical report summarizing the results from year-long simulation of the community model and the community control system using the typical meteorological year data of Fort Collins. Commented [JX15]: Full TWPs should not be developed at this stage, however, a summary of the general work involved is helpful for the review process. Provide a succinct description of the specific activities to be conducted over the proposed period of performance. Descriptions should contain enough detail to convey and disclose the work occurring (i.e., vague statements such as “we will then complete a proprietary process” are unacceptable). It is the submitter’s responsibility to prepare an adequately detailed task plan to convince reviewers that the proposed project and team can meet the goals of the funding program. 10 Stage Gate 1 (M12): NREL will demonstrate the community control system on the simulation test bed. Stage Gate 1 is passed the community self-consumes at least 80% of its PV generation on an annual basis based on the experiments performed on the simulation test bed. Task 4 – Mitigate feeder voltage issues via grid service (M13-M18, $200,000) NREL will collaborate with Fort Collins Utilities to identify the City of Fort Collins’s distribution feeder that connects with the planned Waterfield community, and use the city’s GIS data and AMI data to model this feeder using OpenDSS, which will interact with the Python models developed in Task 3 via the COM interface. We will develop the grid service reference signal based on NREL’s previous work on aggregated DER dispatch algorithm, and study the impact of the smart community on improving distribution feeder voltages by following the grid service reference signal. Subtask 4.1 – Identify and model the utility distribution feeder based on the information from City of Fort Collins Subtask 4.2 – Integrate the Python-based smart community model with the feeder model in OpenDSS Subtask 4.3 – Develop the reference signal from grid for providing distribution voltage regulation service Subtask 4.4 – Evaluate the mitigation effect of feeder voltage issues with different grid services, PV penetration levels, and HEMS participation rate Task 5 – Enhance grid resilience during emergency events (M13-M18, $200,000) NREL will work with partners to identify types of critical loads in the ZNE community and develop models to predict each home’s critical load based on the weather information such as drybulb temperature, relative humidity, and wind speed. Then we will use the hierarchical control framework to solve the 5-day emergency energy dispatch plan for the smart community with the goal of zero power exchange between the community and the utility grid8. We will also study how the amount of flexible loads and size of energy storage change the length of emergency operation. Subtask 5.1 – Identify types of critical loads and develop prediction models considering weather conditions Subtask 5.2 – Design the energy dispatch strategy for emergency operation Subtask 5.3 – Develop resilience metrics and evaluate the community’s resilience using simulation-based study Subtask 5.4 – Analyze the relationship between the emergency operation length, amount of flexible loads and size of energy storage. Task 6– Hardware-in-the-loop (HIL) experiment of the smart community (M19-M24, $250,000) NREL will perform HIL experiments in ESIF with physical homes in the laboratory and other homes in the community simulated in the supercomputer. We will perform robustness and reliability testing of the community control system under different scenarios. Subtask 6.1 – Set up the test environment in the physical home in ESIF’s System Performance Laboratory Subtask 6.2 – Configure other homes in the community and the feeder model on the supercomputer Subtask 6.3 – Perform HIL experiments to evaluate the robustness and reliability of the control system Task 7 – Develop field deployment plans (M19-M24, $50,000) NREL will work closely with Thrive to help develop marketing strategies of the ZNE homes and identify 20 homes that are connected to two separate distribution transformers for field deployment. Fort Collins Utilities will recruit the homeowners for participation in the field demonstration. The team will specify the measurement and verification (M&V) devices needed to verify net zero and the performance of AI-based load disaggregation algorithms. Subtask 7.1 – Identify the homes suitable for field deployment and prioritize marketing of these homes Subtask 7.2 – Specify the M&V devices for verifying net zero and performance of the control systems Subtask 7.3 – Recruit homeowners for participating in the field demonstration Subtask 7.4 – Obtain institutional review board approval and homeowner approval 8 Note: The community is still physically connected to the grid but no power is exchanged. 11 Deliverable 2 (M24): A technical report summarizing the HIL experiment results and the field deployment plan. Stage Gate 2 (M24): The project team will deliver a work plan detailing the planned field demonstration of the community control system in Thrive’s Waterfield community. Stage Gate 2 is passed when DOE reviews and approves this work plan. Task 8 – Field experiments (M25-M33, $600,000) The project team will execute the field deployment plan, deploy the HEMS and M&V devices in 20 homes, configure the aggregator, and implement various use cases to demonstrate the capabilities of the community control system. Subtask 8.1 – Deployment of HEMS and M&V devices in 20 homes and shakedown testing of the HEMS Subtask 8.2 – Baseline data collection for the distribution system Subtask 8.3 – Set up the community aggregator and verify the communication with HEMS and the grid Subtask 8.4 – Implement grid services such as demand response based on signals provided by Fort Collins Utilities and perform optional critical load support field experiments based on the consensus from the homeowners Subtask 8.5 – Remove M&V devices when the monitoring period concludes Subtask 8.6 – Perform data analysis and identify any new gaps or barriers that may have risen during the project Task 9 – Reporting, outreach, and external validation of the core assumptions (M1-M36, $150,000) The team will provide regular progress briefings to DOE, and will participate in reasonable project reviews as requested by DOE such as Peer/Merit Reviews. The team will assemble a TRC with external stakeholders at the beginning of the project to help shape the project and work closely with the TRC throughout the entire project to ensure industry alignment. The TRC will validate the core assumptions of the project and verify the project is on a pathway toward relevance to a marketplace problem. The team will publish outcomes and key learnings of the project in technical publications, webinars and workshops. Subtask 9.1 – Assemble a TRC with external stakeholders and hold quarterly meetings to ensure industry alignment Subtask 9.2 – Provide pertinent data and documentation to the TRC to support the external validation of the core assumptions of the project Subtask 9.3 – Explore the future pathways for the ownership and operation of the community-scale aggregator Subtask 9.4 – Disseminate the outcomes and learnings in various technical publications, webinars and workshops to engage with a broader audience Deliverable 3 (M36): A final report to DOE summarizing the technical approaches, laboratory and field experiment results, key learnings of the project, and outreach activities. 12 3 Team and Resources Our team has strong expertise across areas of solar, power system, building and energy storage. NREL has been conducting cutting-edge research with a long list of accomplishments in developing solutions to reduce barriers to PV deployment and grid modernization. NREL also serves as the technical lead for the DOE’s Building America program, driving toward mass-market solutions for net zero energy homes since its inception 22 years ago. These capabilities are further enhanced by Thrive’s success in constructing over 1,000 energy-efficient homes in the Denver metro area over the past two decades, by Fort Collins Utilities’ first-hand experience in renewable integration and grid operation, and by A.O. Smith’s innovative solutions of grid interactive water heaters. 3.1 Unique Qualifications and Expertise National Renewable Energy Laboratory (NREL) NREL is U.S. DOE’s primary national laboratory for renewable energy and energy efficiency research. From scientific discovery to accelerating market adoption, NREL deploys its deep technical expertise and unmatched breadth of capabilities to drive the transformation of our nation’s energy resources and systems. Dr. Xin Jin and Dr. Fei Ding will serve as the Principal Investigators (PIs) for this project. Dr. Xin Jin has extensive experience in artificial intelligence, load disaggregation, modeling and control of residential buildings, and system integration. He has led algorithm and prototype development efforts for improving energy efficiency and building-to-grid integration in smart homes. He is a key contributor to many DOE- funded projects such as home battery systems, whole building fault detection and diagnostics, and several ESIF high impact projects. Dr. Fei Ding has extensive experience in distributed PV grid integration, voltage regulation, and distribution grid modeling, control and operation. She currently leads multiple projects at NREL to solve grid reliability issues for utility distribution grids with high penetration of PV. She is a main contributor to PV hosting capacity efforts, distribution voltage regulation efforts, and advanced distribution management system efforts at NREL. Other NREL team members have crosscutting expertise in control and optimization, machine learning application, energy storage application, HIL lab experiment and field test. NREL team is actively working with DOE, utilities, cooperatives and manufacturers on relevant topics to visualize and solve end-user and grid challenges faced with high penetration of renewable energy. Thrive Home Builders Thrive is an award-winning builder of energy efficient homes based in Denver, CO. For the past 253 years, Thrive has developed more than 1,000 homes in the Denver metro area and is strongly associated with solidly built, energy efficient homes with signature design features like extra thickthick super insulated walls, high performance mechanical systems, and solar panels. Thrive has won six Grand Housing Innovation Awards is the only builder to win the Grand Award for Housing Innovation from the U.S. DOE for consecutive four5 consecutive years. Thrive has previously been involved in several DOE Building America grants and research programs. Thrive is leading a major housing industry transformation that improves the way Americans live by substantially reducing utility bills, improving indoor air quality, and ensuring engineered comfort way beyond traditional homes. Thrive’s Waterfield community will provide a mature field test bed to deploy the proposed smart community control and fully validate the feasibility of this project. Fort Collins Utilities Fort Collins Utilities provides service to over 70,500 homes and businesses, over 55+ sq. miles. It operates and maintains one of the most reliable electric distribution systems in the country, which is over 99% underground. The City of Fort Collins has set multiple energy goals for 2020, including 2.5% electric efficiency savings per year, 5% of annual peak loads for demand response capacity, and 20% of electricity resources for renewable energy. Fort Collins Utilities is well-aligned with the goals of the proposed project through its Energy Policy and Climate Action Plan. It has also successfully led DOE smart grid deployment and demonstration grant projects in the last decade. The technical support from Fort Collins Utilities will Commented [JX16]: See Merit Review Criterion #3 listed in the template instructions. Describe the project team’s unique qualifications and expertise, including those of key subcontractors and partners Describe the project team’s existing equipment and facilities that will facilitate the successful completion of the proposed project; include a justification of any new equipment or facilities requested as part of the project Describe relevant, previous work efforts, demonstrated innovations, and how these enable the 13 accelerate the process of this project and guarantees the successful field deployment of the proposed work on improving grid performance. A.O. Smith A. O. Smith is the leader and innovator of the U.S. water heating industry. A.O. Smith strives to improve energy efficiency of water heaters and enable grid control capabilities to help utilities address the challenges in the modern grid with high-penetration renewable energy. A.O. Smith’s grid interactive water heaters have been widely used by utilities across the country in demand response programs. NREL has collaborated with A.O. Smith in the INTEGRATE project9 to characterize the grid control capabilities of A.O. Smith’s grid interactive water heaters in NREL’s ESIF laboratories. 3.2 Roles of Key Participants NREL will act as the prime recipient of the award and will coordinate with rest of the team members to execute the tasks and to meet the agreed upon time lines and deliverables. NREL will provide regular monthly oral updates and quarterly written updates to DOE. NREL will hold bi-weekly team meetings to discuss the progress and hand offs/interdependencies among the project team members. NREL will lead the project’s algorithm development, software simulation and hardware-in-the-loop test. NREL will work with Thrive and Fort Collins Utilities to conduct field experiments. It is expected that an existing NREL contractor, Mountain Energy Partnership, may assist NREL with field experiment logistics. Thrive Home Builders will provide following contributions to the project: 1) construction of energy efficient homes to participate in field demonstration, 2) construction of community infrastructure based on NREL recommendations for accomplishing a net zero community, 3) coordination with NREL team around the design, cost optimization, and deployment of behind-the-meter and community-scale solar photovoltaics and energy storage, and 4) provide recommendations on suitability of equipment and methodologies from a residential production builder perspective on constructability and market acceptance. Fort Collins Utilities will provide smart meter data and distribution feeder model to support algorithm development and simulation study. Fort Collins Utilities will also provide technical support in the development process of the Waterfield community. Table 1. Key participants’ role, expertise and time commitment Name Organization Expertise Role Work To Be Performed Time Commitment (in FTE years) Xin Jin, Ph.D. NREL Building Control, Smart Home, AI, System Integration PI Lead Tasks 1-3, 9 1.5 Fei Ding, Ph.D. NREL Distribution Grid Control and Operation, Distributed PV Grid Integration Co-PI Lead Tasks 4-5, 9 1.5 Bethany Sparn NREL Lab Test, Instrumentation and Control Laboratory Test Lead Lead Task 6 0.8 Lieko Earle, Ph.D. 14 Kandler Smith, Ph.D. NREL Battery Control, Battery Life Modeling Energy Storage Advisor Support Tasks 2 and 5 0.1 Nathan Kahre Thrive Home Builders High Performance Home Construction Home Builder Liaison Support Tasks 1-9 0.5 John Phelan Fort Collins Utilities Utility Advisor Support Tasks 1-9 0.2 Kedar Dimble, Ph.D. A.O. Smith Manufacturer Liaison Support Tasks 1-9 0.2 3.3 Existing Equipment and Facilities NREL ESIF The Energy Systems Integration Facility (ESIF) at NREL as show in Figure 6 offers world-class testing capabilities for demonstrating effectiveness of the proposed AI-driven smart community control. ESIF now includes a suite of three residential building testbeds, AC grid simulators, DC power supplies, load banks, PV simulators, diesel generators, fixed energy storage devices, mobile electric vehicles, PV and energy storage inverters for conducting various PV grid integration tests. The petascale supercomputer enables high-fidelity large-scale computations. The ESIF’s 1 MW, bi-directional, 3-phase AC grid simulator has independent phase control that enables simulation of a wide variety of grid scenarios. The test setup provides controller hardware-in-loop and/or power- PHIL testing capabilities. NREL has used tiered hardware-in-the-loop test methods to examine system interactions at every scale – from building subsystems up to the balancing region. Over $30 Millions of research passes through ESIF in a year, and it has ample capability and capacity to host this project. In this project, NREL will conduct HIL test at ESIF using the same PV inverter, battery and home appliances which will be installed in Thrive’s Waterfield 15 Thrive’s ZNE Waterfield Community at Fort Collins, CO Waterfield is a 113-acre community located in Fort Collins, CO, at the foothills of the Rocky Mountains, 72 miles away from NREL. Thrive will start construct this community in 2019, and finish by 2020 Q3. Although an overall development plan has not been established for this community, Thrive envisions a mix of for-sale single family detached homes, townhomes, and cottages. A total of 450 units will be built with 1,768 Sq Ft average house size. Thrive will make this community ZNE and install rooftop PV based on the estimation of the annual load of the community. Thrive will also install smart appliances, home batteries, and community energy storage based on NREL’s recommendations. NREL will perform field demonstration in 20 single family homes which are connected to two separate distribution transformers to test the proposed community-scale control system. Figure 6. Initial concept plan of Thrive’s ZNE Waterfield Community in Fort Collins, CO Commented [JX31]: Nathan: does the following paragraph look OK to you? Any information to add? 16 Appendix A: One-Page Resumes National Renewable Energy Laboratory (NREL) Xin Jin……………………………………………………………...……………………………A2 Fei Ding………………………………………………………………………………………….A3 Bethany Sparn……………………...……………………………………………………………A4 Lieko Earle………………………………………………………………………………………A5 Thrive Home Builders Nathan Kahre Fort Collins Utilities John Phelan A.O. Smith Kedar Dimble Bill Hosken 17 Page 12: [1] Commented [JX16] Jin, Xin 1/10/2018 4:45:00 PM See Merit Review Criterion #3 listed in the template instructions. Describe the project team’s unique qualifications and expertise, including those of key subcontractors and partners Describe the project team’s existing equipment and facilities that will facilitate the successful completion of the proposed project; include a justification of any new equipment or facilities requested as part of the project Describe relevant, previous work efforts, demonstrated innovations, and how these enable the submitter to achieve the project objectives Describe the time commitment of the key team members to support the project Further describe the budget from the cover page if needed For multi-organizational or multi-investigator projects, describe succinctly o The roles and the work to be performed by each PI and key participant o Business agreements between the applicant and each PI and key participant o How the various efforts will be integrated and managed o Process for making decisions on scientific/technical direction o Publication arrangements o Intellectual Property issues o Communication and engagement plans. About Thrive Home Builders Nationally acclaimed Builder • Of affordable housing • Of Net Zero housing • Professional Builder magazine’s Builder of the Year ATTACHMENT 14 What happens if Council does not approve a Metro District? Waterfield has a recorded Final Plat. • 190 Lots • 10 acre TH site • Predominately a garage‐front typical suburban subdivision • Appealing to large conventional builders • No energy efficiency, healthy home, water conservation or affordable housing features. Smart Growth Plan • 498 units • 5 product types • New urbanist “alley” plan • Diverse pedestrian friendly neighborhoods • Nature in the City What happens if Council approves a Metro District? Waterfield Lot Count # Lots % 2 Story TH 94 19% 3 Story TH 85 17% Duplex 32 6% Cottage (AL) 173 35% Cottage (FL) 35 7% Single Family 79 16% 498 100% • 2 Story Affordable Townhomes • 3 Story Townhomes, Duplexes and 2 Story Cottages Aimed at the “Missing Middle” • Market Rate Single Family Detached Cottages 1650 sf average Single Family 2055 sf average Club House & Pool 3 Story TH 1450 sf average 2 Story TH 1250 sf average What happens if Council approves a Metro District? Duplex 1250 sf average • Affordable Housing: • 10% of homes at 80% AMI for 20 years • Over 300 homes at the “Missing Middle” 80% AMI to 120% AMI • Energy Efficiency: • 100% DOE Zero Energy Ready • 10% Net Zero • Healthy Homes: 100% EPA Indoor airPLUS What happens if Council approves a Metro District? Affordable Housing • 10% of homes priced at 80% AMI for 4‐ person families • Affordability period of 20 years • Subject to Council approval of specific plan incorporated into Development Agreement Affordable Housing • 80% AMI for family of 4 = $68,100* • 38%* of income for housing = $2156.50/mo for PITI & Metro District • PI = $1632.35/mo which supports max home price of $312,865 • Prices should be lower to support a larger pool of buyers. For example we recommend that prices start at $280,000 and adjust. * Per City of Ft. Collins Affordable Housing The “Missing Middle” Waterfield Maximum Waterfield Number Service Plan AMI Home Price Home Type of Homes Price 100% $398,950 2 and 3 Story TH 129 $359,00‐ $380,900 120% $485,140 Duplex and Cottage 240 $410,900‐ $441,900 A total of 369 homes out of the 498 home total. Energy Efficiency • 100% of homes DOE Zero Energy Ready • 10% of homes Net Zero Energy 2000 SF Home, August 2017 Electricity $0.44 Gas $1.60 Remainder of $28.50 bill grid charges Energy Efficiency • Top 1% in housing performance* • 20% more efficient than code* • Resulting savings: • $200,000 per year* • 1115 Tons CO2 Per Year • Equivalent of saving 2.5 million miles driven each year *Per Sam Rashkin, DOE Zero Energy Ready Homes Energy Efficiency Grid effects to be analyzed with NREL and City of Fort Collins* *See detailed information provided separately Net Zero • 10% of homes in Waterfield will be Net Zero Energy Healthy Homes • 100% EPA Indoor airPLUS • EPA lists indoor air quality among Top Five Environmental Health Concerns • 100% Active Radon Mitigation • Based on research at the Lawrence Berkley National Laboratory, improvement especially for allergies and asthma Nature in the City 5.4 acre wetland restoration • Storm water management to improve quality and quantity of water reaching the wetland. • Removal of noxious non‐ native weeds • Replacement with native wetland species • Connected Boardwalk & Nature Trail 1 Waterfield Metro District Service Plan Jeff Mihelich & Josh Birks 9-18-18 Presentation Overview 1. Timeline Considerations 2. Community Benefits 3. Metro District Commitments 4. Answers to Council Questions 5. Staff Recommendation 2 Timeline Considerations 3 Metro District Policy Revision Metro District Process Timing Caught Between - Extended Revision Process & Firm Election Deadline May 15, 2017 Aug. 29, 2017 Oct. 24, 2017 Nov. 28, 2017 Mar. 19, 2018 July 10, 2018 Aug. 21, 2018 Policy Adopted (Council) Revised Policy & Model Service Plan (Council WS) Draft Policy (Council Finance) Overview Of Changes (Council WS) Background On Metro Districts (Council WS) Revision Approach (Council Finance) Consider Revision (Council Finance) Sept. 4, 2018 Nov. 2018 May 2018 July 2018 Typical Submittal Actual Submittal Council Review Project Description § New Urbanist Alley Load project § Increased density § 498 units across 5 product types vs. 390 units primarily Single Family § 50 affordable units 4 Community Wide Benefits § Affordable Housing § Energy Efficiency § Renewables § Infrastructure 5 Metro District Commitments Affordable Housing 80% AMI 20+ Years 38% Monthly Payment $280 to $315k Energy Efficiency & Renewables 100% Zero Energy Ready 10% Zero Energy 10% Rooftop Solar ~1,500 Metric Tons CO2e Avoided Infrastructure 2,635 LF of Suniga 2 Foot Wider Sidewalks Buffered Bike Lanes Deliver Enhanced Cross Section 2 Pedestrian Crossings 6 Changes to Service Plan 1. No Debt or Debt Mill until Council approves Development Agreement and/or Intergovernmental Agreement 2. Removed ability to expand the Operating Mill Levy beyond 10 Mills once the Board is composed of a majority of end users 3. City may dissolve the district if no Development Agreement or Intergovernmental Agreement has been approved within 3 years 4. Enhanced commitment language related to public benefits 7 Opportunity vs. Trade-Offs Increased Supply • Potential to add nearly 600 units • Housing Diversity • Ownership at 80% AMI Concern over Added Cost • Metro Districts increases tax burden • Who pays the burden • How does the tax burden impact affordability 8 Affordable Housing & Metro Districts Traditional Sales Price Considers PITI Requires Increased Subsidy Buyers Monthly Cost Consistent Land Trust Allows for dispersed lots Trust Mitigates Tax Burden (25-30%) Sales Price Considers PITI Buyers Monthly Cost Consistent Land Bank Sell to City Deed to City 9 Affordable Housing Percent AMI Area Median Income (AMI) HUD Classification 100% $ 85,100 Moderate Income 80% $ 68,100 Low Income 60% $ 51,060 Low Income 50% $ 42,550 Very Low Income 30% $ 25,550 Extremely Low Income 3 Person 4 Person 80% AMI $ 61,300 $ 68,100 Monthly Income $ 5,110 $ 5,680 Available for Housing (38%) $ 1,942 $ 2,158 Property Taxes (.072%) $ 200 $ 230 Metro Taxes/HOA Fees ($200/mo) $ 200 $ 200 Insurance (.038%) $ 110 $ 120 Monthly Mortgage Payment $ 1,432 $ 1,608 Loan Amount $ 266,800 $ 299,500 Down Payment $ 11,100 $ 12,500 Total Purchase Price $ 277,900 $ 312,000 ItemHousehold 10 2018, 4 Person Household Source: Housing & Urban Development, US Gov’t; Social Sustainability Zero Energy Ready Home Baseline Home: § 2015 IECC Code with local options Zero Energy Ready Home: § Generates as much energy as consumes § Certified Energy Star Ver. 3 or 3.1 § Duct Systems in thermal and air boundary § Lights & Appliances – Energy Star Qualified (80% of lighting) § Meet DOE PV-Ready checklist 11 Average HERS Rating – 58 to 62 Average HERS Rating – Low 40s Zero Energy Ready Home Zero Energy Ready Home (ZEHR) – Impact § Approximate kWh saving / year = 1,350 kWh § Approximate Therms saving / year = 300 th § Estimated Metric Tons of CO2 equivalent avoided / year = 3 § Total Annual savings compared to Baseline home: $450 (Assumptions: Baseline was 2015 IECC code, with gas thermal heating. 2,400 Square foot home with 4 Bedrooms, 2 Baths, and a full basement. Utility rates are default rates.) 12 Metro District Revenue Present Value 13 Item 40 Years Perpetuity Difference Median Sales Price $ 425,000 $ 425,000 $ - Typical Fort Collins Mills 90.828 90.828 Typical Fort Collins Property Tax Liability $ 2,779 $ 2,779 $ - Hypothetical Metro DistrictMills 50.000 50.000 Metro District Property Tax Liability $ 1,530 $ 1,530 $ - New Total Property Tax Liability $ 4,309 $ 4,309 $ - Percent Increase of Property Taxes 55% 55% Metro Mill Levy Propety Tax Maximum Value as Present Value $26,253 $30,600 ($4,347) § Assumes 5% Appreciation rate (Based on historic data 1998 to 2018) § Assumes 5% discount rate (Based on current mortgage rates) § Differential equals approximately 17% increase in present value 3-Story Townhome Single Family Detached Cottage 2-Story Townhome Duplex Weighted Average Proposed Development Home Values $ 380,900 $ 510,900 $ 441,900 $ 359,900 $ 410,900 $ 423,709 Annual Metro District Tax Liability $ 1,371 $ 1,839 $ 1,591 $ 1,296 $ 1,479 $ 1,525 Present Value - 40 Year Collection $ 23,529 $ 31,560 $ 27,297 $ 22,232 $ 25,382 $ 26,174 Present Value - Collection in Perpetuity $ 27,425 $ 36,785 $ 31,817 $ 25,913 $ 29,585 $ 30,507 Change in collection $ 3,896 $ 5,225 $ 4,519 $ 3,681 $ 4,202 $ 4,333 Metro District Revenue Present Value Take-Away: § Present value calculated on perpetuity increases the value by 17% compared to the 40-year analysis 14 Staff Recommendation § Staff recommends adoption of the resolution 15 16 Northeast Fort Collins -1- RESOLUTION 2018-082 OF THE CITY COUNCIL OF THE CITY OF FORT COLLINS APPROVING THE CONSOLIDATED SERVICE PLAN FOR WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 WHEREAS, Title 32 of the Colorado Revised Statutes (“C.R.S.”) authorizes the formation of various kinds of governmental entities to finance and operate public services and infrastructure, including metropolitan districts; and WHEREAS, in July 2008, the City Council adopted Resolution 2008-069 in which it approved a policy setting forth various guidelines, requirements and criteria concerning the City’s review and approval of service plans for metropolitan districts (the “2008 Policy”); and WHEREAS, on August 21, 2018, City Council adopted Resolution 2018-079 approving the “City of Fort Collins Policy for Reviewing Service Plans for Metropolitan Districts” (the “2018 Policy”) setting forth guidelines, requirements and criteria applicable to the City’s consideration a metropolitan district service plan to replace and supersede those in the 2008 Policy, except for the fee and notice requirements when they have been satisfied by a service plan applicant under the 2008 Policy before the adoption of the 2018 Policy; and WHEREAS, pursuant to the provisions of Article 1 of Title 32 of the Colorado Revised Statutes (the “Special District Act”), TH Waterfield LLC (the “Petitioner”) has submitted to the City a Consolidated Service Plan (the “Service Plan”) for the Waterfield Metropolitan District Nos. 1-3 (each a “District” and collectively the “Districts”); and WHEREAS, a copy of the Service Plan is attached as Exhibit “A” and incorporated herein by reference; and WHEREAS, the Districts will be organized to provide for the planning, design, acquisition, construction, installation, relocation, redevelopment and operation and maintenance of certain public improvements, as more specifically described in the Service Plan; and WHEREAS, the 2008 Policy includes the requirement that the Petitioner must cause notice of the public hearing at which the approval resolution for the Service Plan is to be considered by the City Council, to be mailed by first class mail to the owners of record all property within the proposed Districts and within any inclusion area specifically identified in the Service Plan (the “Property Owners”) at least 10 days in advance of the public hearing; and WHEREAS, in lieu of mailing the notice required in the 2008 Policy, the Petitioner has published and provided actual notice to each of the Property Owners at least 10 days in advance of the City Council’s September 4, 2018, public hearing on the Service Plan (the “Public Hearing”), and the Petitioner has secured and provided to the City Clerk before the Public Hearing copies of an “Acknowledgment of Notice” from each of the Property Owners; and WHEREAS, each of the Property Owners has expressly waived in their respective Acknowledgement of Notice all rights to any additional notice under the 2008 Policy, the 2018 Policy and Resolution 2018-079; and -2- WHEREAS, at its September 4, 2018 meeting, the City Council conducted the Public Hearing reviewing the Service Plan, the Acknowledgements of Notice and received testimony and evidence and then voted to continue the Public Hearing to its September 18, 2018 meeting, and at that meeting has received additional testimony and evidence; and WHEREAS, the Special District Act requires that any service plan submitted to the district court for the creation of a metropolitan district must first be approved by resolution of the governing body of the municipality within which the proposed district lies; and WHEREAS, the City Council wishes to approve the Service Plan for the Districts. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT COLLINS, COLORADO, as follows: Section 1. That the City Council hereby makes and adopts the determinations and findings contained in the recitals set forth above. Section 2. That the City Council hereby determines that the Petitioner has substantially complied with the City’s notice requirements in the 2008 Policy, the 2018 Policy and Resolution 2018-079 with regard to the Public Hearing on the Service Plan, and that the Property Owners have each received actual notice of the Public Hearing and expressly waived any further notice of the Public Hearing that might otherwise be required under the 2008 Policy, the 2018 Policy and Resolution 2018-079. Section 3. That the City Council hereby finds that the Service Plan contains, or sufficiently provides for, the items described in Section 32-1-202(2), C.R.S., and that: (a) There is sufficient existing and projected need for organized service in the area to be serviced by the proposed Districts; (b) The existing service in the area to be served by the proposed Districts is inadequate for present and projected needs; (c) The proposed Districts are capable of providing economical and sufficient service to the area within their proposed boundaries; and (d) The area to be included within the proposed Districts has, or will have, the financial ability to discharge the proposed indebtedness on a reasonable basis. Section 4. The City Council’s findings are based solely upon the evidence in the Service Plan as presented at the Public Hearing and the City has not conducted any independent investigation of the evidence. The City makes no guarantee as to the financial viability of the Districts or the achievability of the desired results. Section 5. That the City Council hereby approves the Service Plan. -3- Section 6. That the City Council’s approval of the Service Plan is not a waiver or a limitation upon any power that the City Council is legally permitted to exercise regarding the property within the Districts. Passed and adopted at a regular meeting of the Council of the City of Fort Collins this 18th day of September, A.D. 2018. _________________________________ Mayor ATTEST: _____________________________ City Clerk CONSOLIDATED SERVICE PLAN FOR WATERFIELD METROPOLITAN DISTRICT NOS. 1-3 CITY OF FORT COLLINS, COLORADO Prepared by: White Bear Ankele Tanaka & Waldron, Professional Corporation 748 Whalers Way, Suite 210 Fort Collins, Colorado 80525 Submitted On: August 29, 2018 Approved On: September 18, 2018 EXHIBIT A i Table of Contents INTRODUCTION ...........................................................................................................................1 Purpose and Intent ........................................................................................................................1 Need for Districts .........................................................................................................................1 Objective of the City regarding Districts’ Service Plan ...............................................................2 City Approvals .............................................................................................................................2 DEFINITIONS .................................................................................................................................2 BOUNDARIES AND LOCATION .................................................................................................5 DESCRIPTION OF PROJECT, PLANNED DEVELOPMENT, PUBLIC BENEFIT & ASSESSED VALUATION .............................................................................................................6 Project and Planned Development ...............................................................................................6 Public Benefits .............................................................................................................................6 Assessed Valuation ......................................................................................................................7 INCLUSION OF LAND IN THE SERVICE AREA ......................................................................7 DISTRICT GOVERNANCE ...........................................................................................................7 AUTHORIZED AND PROHIBITED POWERS ............................................................................7 Prohibited Improvements and Services and other Restrictions and Limitations ........................8 Eminent Domain Restriction ..............................................................................................8 Fee Limitation ....................................................................................................................8 Operations and Maintenance ..............................................................................................8 Fire Protection Restriction .................................................................................................9 Public Safety Services Restriction .....................................................................................9 Grants from Governmental Agencies Restriction ..............................................................9 Golf Course Construction Restriction ..................................................................................9 Television Relay and Translation Restriction ....................................................................9 Sales and Use Tax Exemption Limitation .......................................................................10 Sub-district Restriction ....................................................................................................10 Initial Debt Limitation .....................................................................................................10 Privately Placed Debt Limitation .....................................................................................10 Special Assessments ..........................................................................................................10 PUBLIC IMPROVEMENTS AND ESTIMATED COSTS ..........................................................10 ii Development Standards ..............................................................................................................11 Contracting .................................................................................................................................11 Land Acquisition and Conveyance ............................................................................................11 Equal Employment and Discrimination .....................................................................................12 FINANCIAL PLAN/PROPOSED DEBT......................................................................................12 Financial Plan .............................................................................................................................12 Mill Levies .................................................................................................................................12 Aggregate Mill Levy Maximum ......................................................................................12 Regional Mill Levy Not Included in Other Mill Levies ..................................................13 Operating Mill Levy ........................................................................................................13 Gallagher Adjustments .....................................................................................................13 Excessive Mill Levy Pledges ............................................................................................13 Refunding Debt ................................................................................................................13 Maximum Debt Authorization ..........................................................................................13 Maximum Voted Interest Rate and Underwriting Discount ......................................................14 Interest Rate and Underwriting Discount Certification ..............................................................14 Disclosure to Purchasers ............................................................................................................14 External Financial Advisor .........................................................................................................15 Disclosure to Debt Purchasers ....................................................................................................15 Security for Debt ........................................................................................................................15 TABOR Compliance ..................................................................................................................15 Districts’ Operating Costs ..........................................................................................................16 Regional Improvements .................................................................................................................16 Regional Mill Levy Authority ....................................................................................................16 Regional Mill Levy Imposition ..................................................................................................16 City Notice Regarding Regional Improvements ........................................................................16 Regional Improvements Authorized Under Service Plan ..........................................................16 Expenditure of Regional Mill Levy Revenues ...........................................................................17 Intergovernmental Agreement .........................................................................................17 No Intergovernmental Agreement ...................................................................................17 Regional Mill Levy Term ...........................................................................................................17 iii Completion of Regional Improvements .....................................................................................17 City Authority to Require Imposition ........................................................................................17 Regional Mill Levy Not Included in Other Mill Levies .............................................................17 Gallagher Adjustment ................................................................................................................17 City Fees ........................................................................................................................................17 Bankruptcy Limitations .................................................................................................................18 Annual Reports and Board Meetings .............................................................................................18 General .......................................................................................................................................18 Board Meetings ………………………………………………………………………………..18 Report Requirements ..................................................................................................................18 Narrative ...........................................................................................................................18 Financial Statements .........................................................................................................18 Capital Expenditures ........................................................................................................19 Financial Obligations ........................................................................................................19 Other Information ............................................................................................................19 Reporting of Significant Events .................................................................................................19 Failure to Submit ........................................................................................................................20 Service Plan Amendments .............................................................................................................20 Material Modifications...................................................................................................................20 Dissolution .....................................................................................................................................20 Sanctions ........................................................................................................................................21 Conclusion .....................................................................................................................................21 Resolution of Approval ..................................................................................................................22 iv EXHIBIT EXHIBIT A-1 Legal Description of District No. 1 Boundaries EXHIBIT A-2 Legal Description of District No. 2 Boundaries EXHIBIT A-3 Legal Description of District No. 3 Boundaries EXHIBIT B-1 District No. 1 Boundary Map EXHIBIT B-2 District No. 2 Boundary Map EXHIBIT B-3 District No. 3 Boundary Map EXHIBIT C Vicinity Map EXHIBIT D Public Improvement Cost Estimates EXHIBIT E Public Improvements Maps EXHIBIT F Financial Plan EXHIBIT G Public Benefits EXHIBIT H Disclosure Notice 1 I. INTRODUCTION A. Purpose and Intent. The Districts, which are intended to be independent units of local government separate and distinct from the City, are governed by this Service Plan, the Special District Act and other applicable State law. Except as may otherwise be provided for by State law, City Code or this Service Plan, the Districts’ activities are subject to review and approval by the City Council only insofar as they are a material modification of this Service Plan under C.R.S. Section 32-1-207 of the Special District Act. It is intended that the Districts will provide all or part of the Public Improvements for the Project for the use and benefit of all anticipated inhabitants and taxpayers of the Districts. The primary purpose of the Districts will be to finance the construction of a portion of these Public Improvements by the issuance of Debt. It is also intended under this Service Plan that no District shall be authorized to issue any Debt, impose a Debt Mill Levy or impose any Fees for payment on Debt unless and until the delivery of the applicable Public Benefits described in Section IV.B of this Service Plan has been secured in accordance with Section IV.B of this Service Plan. It is further intended that this Service Plan requires the Districts to pay a portion of the cost of the Regional Improvements, as provided in Section X of this Service Plan, as part of ensuring that those privately-owned properties to be developed in the District that benefit from the Regional Improvements pay a reasonable share of the associated costs. The Districts are not intended to provide ongoing operations and maintenance services except as expressly authorized in this Service Plan. It is the intent of the Districts to dissolve upon payment or defeasance of all Debt incurred or upon a court determination that adequate provision has been made for the payment of all Debt, except that if the Districts are authorized in this Service Plan to perform continuing operating or maintenance functions, the Districts shall continue in existence for the sole purpose of providing such functions and shall retain only the powers necessary to impose and collect the taxes or Fees authorized in this Service Plan to pay for the costs of those functions. It is intended that the Districts shall strictly comply the provisions of this Service Plan and that the City may enforce any non-compliance with these provisions as provided in Section XVII of this Service Plan. B. Need for the Districts. There are currently no other governmental entities, including the City, located in the immediate vicinity of the Districts that consider it desirable, feasible or practical to undertake the planning, design, acquisition, construction, installation, relocation, redevelopment and financing of the Public Improvements needed for the Project. Formation of the Districts is therefore 2 necessary in order for the Public Improvements required for the Project to be provided in the most economic manner possible. C. Objective of the City Regarding Districts’ Service Plan. The City’s objective in approving this Service Plan is to authorize the Districts to provide for the planning, design, acquisition, construction, installation, relocation and redevelopment of the Public Improvements from the proceeds of Debt to be issued by the Districts, but in doing so, to also establish in this Service Plan the means by which both the Regional Improvements and the Public Benefits will be provided. Except as specifically provided in this Service Plan, all Debt is expected to be repaid by taxes and Fees imposed and collected for no longer than the Maximum Debt Mill Levy Imposition Term for residential properties, and at a tax mill levy no higher than the Maximum Debt Mill Levy. Fees imposed for the payment of Debt shall be due no later than upon the issuance of a building permit unless a majority of the Board which imposes such a Fee is composed of End Users as provided in Section VII.B.2. Debt which is issued within these parameters and, as further described in the Financial Plan, will insulate property owners from excessive tax and Fee burdens to support the servicing of the Debt and will result in a timely and reasonable discharge of the Debt. D. City Approvals. Any provision in this Service Plan requiring “City” or “City Council” approval or consent shall require the City Council’s prior written approval or consent exercised in its sole discretion. Any provision in this Service Plan requiring “City Manager” approval or consent shall require the City Manager’s prior written approval or consent exercised in the City Manager’s sole discretion. II. DEFINITIONS In this Service Plan, the following words, terms and phrases which appear in a capitalized format shall have the meaning indicated below, unless the context clearly requires otherwise: Aggregate Mill Levy: means the total mill levy resulting from adding a District’s Debt Mill Levy and Operating Mill Levy. A District’s Aggregate Mill Levy does not include any Regional Mill Levy that the District may levy. Aggregate Mill Levy Maximum: means the maximum number of combined mills that each District may each levy for their Debt Mill Levy and Operating Mill Levy, at a rate not to exceed the limitation set in Section IX.B.1 of this Service Plan. Approved Development Plan: means a City-approved development plan or other land-use application required by the City Code for identifying, among other things, public improvements necessary for facilitating the development of property within the Service Area, which plan shall include, without limitation, any development agreement required by the City Code. Board or Boards: means the duly constituted board of directors of any of the Districts, or the boards of directors of all of the Districts, in the aggregate. Bond, Bonds or Debt: means bonds, notes or other multiple fiscal year financial obligations 3 for the payment of which a District has promised to impose an ad valorem property tax mill levy, Fees or other legally available revenue. Such terms do not include contracts through which a District procures or provides services or tangible property. City: means the City of Fort Collins, Colorado, a home rule municipality. City Code: means collectively the City’s Municipal Charter, Municipal Code, Land Use Code and ordinances as all are now existing and hereafter amended. City Council: means the City Council of the City of Fort Collins, Colorado. City Manager: means the City Manager of the City of Fort Collins, Colorado. C.R.S.: means the Colorado Revised Statutes. Debt Mill Levy: means a property tax mill levy imposed on Taxable Property within a District for the purpose of paying Debt as authorized in this Service Plan, at a rate not to exceed the limitations set in Section IX.B. Developer: means a person or entity that is the owner of property or owner of contractual rights to property in the Service Area that intends to develop the property. District: means Waterfield Metropolitan District No. 1, Waterfield Metropolitan District No. 2 or Waterfield Metropolitan District No. 3, individually, each organized under and governed by this Service Plan. District No. 1 Boundaries: means the boundaries of the area legally described in Exhibit “A-1” attached hereto and incorporated by reference and as depicted in the District No. 1 Boundary Map. District No. 2 Boundaries: means the boundaries of the area legally described in Exhibit “A-2” attached hereto and incorporated by reference and as depicted in the District No. 2 Boundary Map. District No. 3 Boundaries: means the boundaries of the area legally described in Exhibit “A-3” attached hereto and incorporated by reference and as depicted in the District No. 3 Boundary Map. District No. 1 Boundary Map: means the map of the District No. 1 Boundaries attached hereto as Exhibit “B-1” and incorporated by reference. District No. 2 Boundary Map: means the map of the District No. 2 Boundaries attached hereto as Exhibit “B-2” and incorporated by reference. District No. 3 Boundary Map: means the map of the District No. 3 Boundaries attached hereto as Exhibit “B-3” and incorporated by reference. Districts: means Waterfield Metropolitan District No. 1, Waterfield Metropolitan District No. 2 and Waterfield Metropolitan District No. 3, collectively, organized under and governed by this Service Plan. End User: means any owner, or tenant of any owner, of any property within the Districts, who is intended to become burdened by the imposition of ad valorem property taxes and/or Fees. By way of illustration, a resident homeowner, renter, commercial property owner or 4 commercial tenant is an End User. A Developer and any person or entity that constructs homes or commercial structures is not an End User. External Financial Advisor: means a consultant that: (1) is qualified to advise Colorado governmental entities on matters relating to the issuance of securities by Colorado governmental entities including matters such as the pricing, sales and marketing of such securities and the procuring of bond ratings, credit enhancement and insurance in respect of such securities; (2) shall be an underwriter, investment banker, or individual listed as a public finance advisor in the Bond Buyer’s Municipal Market Place or, in the City’s sole discretion, other recognized publication as a provider of financial projections; and (3) is not an officer or employee of the Districts or an underwriter of the Districts’ Debt. Fees: means the fees, rates, tolls, penalties and charges the Districts are authorized to impose and collect under this Service Plan. Financial Plan: means the Financial Plan described in Section IX of this Service Plan which was prepared by D.A. Davidson and Co. in accordance with the requirements of this Service Plan and describes (a) how the Public Improvements are to be financed; (b) how the Debt is expected to be incurred; and (c) the estimated operating revenue derived from property taxes and any Fees for the first budget year through the year in which all of the Districts’ Debt is expected to be defeased or paid in the ordinary course. Maximum Debt Authorization: means the total Debt the Districts are permitted to issue as set forth in Section IX.B.7 of this Service Plan. Maximum Debt Mill Levy Imposition Term: means the maximum term during which a District’s Debt Mill Levy may be imposed on residential property within its boundaries. This maximum term shall not exceed forty (40) years from December 31 of the year this Service Plan is approved by City Council. Operating Mill Levy: means a property tax mill levy imposed on Taxable Property for the purpose of funding District administration, operations and maintenance as authorized in this Service Plan, including, without limitation, repair and replacement of Public Improvements, and imposed at a rate not to exceed the limitations set in Section IX.B of this Service Plan. Planned Development: means the private development or redevelopment of the properties in the Service Area, commonly referred to as the Waterfield development, under an Approved Development Plan. Project: means the installation and construction of the Public Improvements for the Planned Development. Public Improvements: means the improvements and infrastructure the Districts are authorized by this Service Plan to fund and construct for the Planned Development to serve the future taxpayers and inhabitants of the Districts, except as specifically prohibited or limited in this Service Plan. Public Improvements shall include, without limitation, the improvements and infrastructure described in Exhibit “D” attached hereto and incorporated by reference. Public Improvements do not include Regional Improvements. 5 Regional Improvements: means any regional public improvement identified by the City, as provided in Section X of this Service Plan, for funding, in whole or part, by a Regional Mill Levy levied by the Districts. Regional Mill Levy: means the property tax mill tax imposed on Taxable Property for the purpose of planning, designing, acquiring, funding, constructing, installing, relocating and/or redeveloping the Regional Improvements and/or to fund the administration and overhead costs related to the Regional Improvements as provided in Section X of this Service Plan. Service Area: means the property within the District No. 1 Boundaries, District No. 2 Boundaries and District No. 3 Boundaries, collectively, as may be amended from time to time as further set forth in this Service Plan and the Special District Act. Special District Act: means Article 1 in Title 32 of the Colorado Revised Statutes, as amended. Service Plan: means this service plan for the Districts approved by the City Council. Service Plan Amendment: means a material modification of the Service Plan approved by the City Council in accordance with the Special District Act, this Service Plan and any other applicable law. State: means the State of Colorado. Taxable Property: means the real and personal property within the Service Area that will subject to the ad valorem taxes imposed by the Districts. TABOR: means Colorado’s Taxpayer’s Bill of Rights in Article X, Section 20 of the Colorado Constitution. Vicinity Map: means the map attached hereto as Exhibit “C” and incorporated by reference depicting the location of the Service Area within the regional area surrounding it. III. BOUNDARIES AND LOCATION The area of the Service Area includes approximately 93 acres. A legal description and map of the District No. 1 Boundaries are attached hereto as Exhibit A-1 and Exhibit B-1, respectively, a legal description and map of the District No. 2 Boundaries are attached hereto as Exhibit A-2 and Exhibit B-2, respectively, and a legal description and map of the District No. 3 Boundaries are attached hereto as Exhibit A-3 and Exhibit B-3, respectively. It is anticipated that the Districts’ boundaries may expand or contract from time to time as the Districts undertake inclusions or exclusions pursuant to the Special District Act, subject to the limitations set forth in this Service Plan. The location of the Service Area is further depicted in the Vicinity Map attached as Exhibit “C”. 6 IV. DESCRIPTION OF PROJECT, PLANNED DEVELOPMENT, PUBLIC BENEFITS & ASSESSED VALUATION A. Project and Planned Development. The current Developer of the Project and Planned Development, Thrive Home Builders, is a nationally acclaimed builder which emphasizes environmental conservation, and is currently Denver’s largest builder of “for sale” affordable housing. The current Preliminary Development Plan for the Planned Development includes approximately 190 total residential units and is intended to be revised to include 498 residential units. Of the planned 498 residential units, 50 units are intended to be “affordable housing”. All of the 498 residential units are planned to be zero energy ready units or net zero energy units. The Planned Development is currently intended to reach build out in 2026, with an estimated population of 1,145 persons. In accordance with the Financial Plan, the estimated assessed valuation of the Planned Development in 2023 will be $9,989,117, and in 2028 will be $18,743,620. Approval of this Service Plan by the City Council does not imply approval of the development of any particular land-use for any specific area within the Districts. Any such approval must be contained within an Approved Development Plan. B. Public Benefits. In addition to providing a portion of the Public Improvements and Regional Improvements, the organization of the Districts is intended to enable the Project and Planned Development to deliver a number of public benefits, including, but not limited to, affordable housing, energy and water conservation, community services, multi-modal transportation, zero energy ready and net zero energy homes, housing variety, new urbanist alley load planning concepts and other innovation. The public benefits to be provided under this Service Plan are specifically described in Exhibit G attached hereto and incorporated herein by reference (collectively, the “Public Benefits”). Therefore, notwithstanding any provision to the contrary contained in this Service Plan, no District shall be authorized to issue any Debt or to impose a Debt Mill Levy or any Fees for payment of Debt on any Taxable Property unless and until the delivery of the Public Benefits specifically related to the phase of the Planned Development or portion of the Project to be financed with such Debt, Debt Mill Levy or Fees, are secured in a manner approved by the City Council. To satisfy this precondition to the issuance of Debt and to the imposition of the Debt Mill Levy and Fees, delivery of the Public Benefits for each phase of the Project and the Planned Development must be secured by the following methods, as applicable: 1. For any portion of the Public Benefits to be provided by one or more of the Districts, each such District must enter into an intergovernmental agreement with the City either (i) agreeing to provide those Public Benefits as a legally enforceable multiple-fiscal year obligation of the District under TABOR, or by (ii) securing performance of that obligation with a surety bond, letter of credit or other security acceptable to the City, and any such intergovernmental agreement must be approved by the City Council by resolution; 7 2. For any portion of the Public Benefits to be provided by one or more Developers of the Planned Development, each such Developer must either (i) enter into a development agreement with the City under the Developer’s applicable Approved Development Plan, which agreement must legally obligate the Developer to provide those Public Benefits before the City is required to issue building permits and/or certificates of occupancy for structures to be built under the Approved Development Plan for that phase of the Planned Development, or (ii) secure such obligations with a surety bond, letter of credit or other security acceptable to the City, and all such development agreements must be approved by the City Council by resolution; or 3. For any portion of the Public Benefits to be provided in part by one or more of the Districts in the Project and in part by one or more of the Developers in the Planned Development or the Project, an agreement between the City and the affected District(s) and Developers that secures such Public Benefits as legally binding obligations using the methods described in subsections 1 and 2 above, and all such agreements must be approved by the City Council by resolution. C. Assessed Valuation The current assessed valuation of the Service Area is approximately One Million Two Hundred Sixty-Seven Thousand Two Hundred Dollars ($1,267,200) and, at build out, is expected to be approximately Nineteen Million Dollars ($19,000,000). These amounts are expected to be sufficient to reasonably discharge the Debt as demonstrated in the Financial Plan. V. INCLUSION OF LAND IN THE SERVICE AREA The Districts shall not add any property to the Service Area without the City Council’s prior written approval and in compliance with the Special District Act. Once a District has issued Debt, it shall not exclude real property from the District’s boundaries without the prior written consent of the City Council. VI. DISTRICT GOVERNANCE The Districts’ Boards shall be comprised of persons who are a qualified “eligible electors” of the Districts as provided in the Special District Act. It is anticipated that over time, the End Users who are eligible electors will assume direct electoral control of the Districts’ Boards as development within the Service Area progresses. The Districts shall not enter into any agreement by which the End Users’ electoral control of the Boards is removed or diminished. VII. AUTHORIZED AND PROHIBITED POWERS A. General Grant of Powers. The Districts shall have the power and authority to provide the Public Improvements, the Regional Improvements and related operation and maintenance services, within and without the Service Area, as such powers and authorities are described in the Special District Act, other applicable State law, common law and the Colorado Constitution, subject to the prohibitions, restrictions and limitations set forth in this Service Plan. 8 If, after the Service Plan is approved, any State law is enacted to grant additional powers or authority to metropolitan districts by amendment of the Special District Act or otherwise, such powers and authority shall be deemed to be a part hereof and available to be exercised by the Districts if the City Council first approves the exercise of such powers or authority by the Districts. Such approval by the City Council shall not constitute a Service Plan Amendment. B. Prohibited Improvements and Services and other Restrictions and Limitations. The Districts’ powers and authority under this Service Plan to provide Public Improvements and services and to otherwise exercise their other powers and authority under the Special District Act and other applicable State law, are prohibited, restricted and limited as hereafter provided. Failure to comply with these prohibitions, restrictions and limitations shall constitute a material modification under this Service Plan and shall entitle the City to pursue all remedies available at law and in equity as provided in Section XVII of this Service Plan: 1. Eminent Domain Restriction The Districts shall not exercise their statutory power of eminent domain without first obtaining resolution approval from the City Council. This restriction on the Districts’ exercise of the eminent domain power is being voluntarily acquiesced to by the Districts and shall not be interpreted in any way as a limitation on the Districts’ sovereign powers and shall not negatively affect the Districts’ status as political subdivision of the State as conferred by the Special District Act. 2. Fee Limitation Any Fees imposed for the repayment of Debt, as authorized by this Service Plan, shall not be imposed by the Districts upon or collected from an End User. In addition, Fees imposed for the payment of Debt shall not be imposed unless and until the requirements for securing the delivery of the relevant portion of the Public Benefits have been satisfied in accordance with Section IV.B of this Service Plan. Notwithstanding any of the foregoing, this Fee limitation shall not apply to any Fee imposed to fund the operation, maintenance, repair or replacement of Public Improvements or the administration of the Districts. 3. Operations and Maintenance The primary purpose of the Districts is to plan for, design, acquire, construct, install, relocate, redevelop and finance a portion of the Public Improvements. The Districts shall dedicate the Public Improvements to the City or other appropriate jurisdiction or owners’ association in a manner consistent with the Approved Development Plan and the City Code, provided that nothing herein requires the City to accept a dedication. Each District is specifically authorized to operate and maintain any part or all of the Public Improvements not otherwise conveyed or dedicated to the City or another appropriate governmental entity. Additionally, the Districts are authorized to operate and maintain any part or all of the Public Improvements not otherwise conveyed or dedicated to the City or another appropriate governmental entity until such time that the Districts dissolve. 9 4. Fire Protection Restriction The Districts are not authorized to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain fire protection facilities or services, unless such facilities and services are provided pursuant to an intergovernmental agreement with the Poudre Fire Authority. The authority to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain fire hydrants and related improvements installed as part of the water system shall not be limited by this subsection. 5. Public Safety Services Restriction The Districts are not authorized to provide policing or other security services. However, the Districts may, pursuant to C.R.S. § 32-1-1004(7), as amended, furnish security services pursuant to an intergovernmental agreement with the City. 6. Grants from Governmental Agencies Restriction The Districts shall not apply for grant funds distributed by any agency of the United States Government or the State without the prior written approval of the City Manager. This does not restrict the collection of Fees for services provided by the Districts to the United States Government or the State. 7. Golf Course Construction Restriction Acknowledging that the City has financed public golf courses and desires to coordinate the construction of public golf courses within the City’s boundaries, the Districts shall not be authorized to plan, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain a golf course unless such activity is pursuant to an intergovernmental agreement with the City. 8. Television Relay and Translation Restriction The Districts are not authorized to plan for, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain television relay and translation facilities and services, other than for the installation of conduit as a part of a street construction project, unless such facilities and services are provided pursuant to prior written approval from the City Council. 9. Potable Water and Wastewater Treatment Facilities Acknowledging that the City and other existing special districts operating within the City currently own and operate treatment facilities for potable water and wastewater that are available to provide services to the Service Area, the Districts shall not plan, design, acquire, construct, install, relocate, redevelop, finance, own, operate or maintain such facilities without obtaining the City Council’s prior written approval either by intergovernmental agreement or as a Service Plan Amendment. 10 10. Sales and Use Tax Exemption Limitation The Districts shall not exercise any City sales and use tax exemption otherwise available to the Districts under the City Code. 11. Sub-district Restriction The Districts shall not create any sub-district pursuant to the Special District Act without the prior written approval of the City Manager. 12. Privately Placed Debt Limitation Prior to the issuance of any privately placed Debt, the Districts shall obtain the certification of an External Financial Advisor substantially as follows: We are [I am] an External Financial Advisor within the meaning of the District’s Service Plan. We [I] certify that (1) the net effective interest rate (calculated as defined in C.R.S. Section 32-1-103(12)) to be borne by [insert the designation of the Debt] does not exceed a reasonable current [tax- exempt] [taxable] interest rate, using criteria deemed appropriate by us [me] and based upon our [my] analysis of comparable high yield securities; and (2) the structure of [insert designation of the Debt], including maturities and early redemption provisions, is reasonable considering the financial circumstances of the District. 13. Special Assessments The Districts shall not impose special assessments without the prior written approval of the City Council. VIII. PUBLIC IMPROVEMENTS AND ESTIMATED COSTS Exhibit D summarizes the type of Public Improvements that are projected to be constructed and/or installed by the Districts. The cost, scope, and definition of such Public Improvements may vary over time. The total estimated costs of Public Improvements, as set forth in Exhibit D, excluding any improvements paid for by the Regional Mill Levy necessary to serve the Planned Development, are approximately Forty-Three Million Nine Hundred Eighty One Thousand Fifty Dollars ($43,981,050) in project costs in 2018 dollars. The cost estimates are based upon preliminary engineering, architectural surveys, and reviews of the Public Improvements and include all construction cost estimates together with estimates of costs such as land acquisition, engineering services, legal expenses and other associated expenses. Maps of the anticipated location, operation, and maintenance of Public Improvements are attached hereto as Exhibit E. Changes in the Public Improvements or costs, which are approved by the City in an Approved Development Plan, shall not constitute a Service Plan Amendment. In addition, the City shall not be bound by this Service Plan in reviewing and approving the Approved Development Plan and the Approved Development Plan shall supersede the Service Plan with regard to the cost, scope and definition of Public Improvements. Provided, however, any agreement approved and entered 11 into under Section IV.B of this Service Plan for the provision of a Public Improvement that is also a Public Benefit, shall supersede both this Service Plan and the applicable Approved Development Plan. Except as otherwise provided by an agreement approved under Section IV.B of this Service Plan: (i) the design, phasing of construction, location and completion of Public Improvements will be determined by the Districts to coincide with the phasing and development of the Planned Development and the availability of funding sources; (ii) the Districts may, in their discretion, phase the construction, completion, operation, and maintenance of Public Improvements or defer, delay, reschedule, rephase, relocate or determine not to proceed with the construction, completion, operation, and maintenance of Public Improvements, and such actions or determinations shall not constitute a Service Plan Amendment; and (iii) the Districts shall also be permitted to allocate costs between such categories of the Public Improvements as deemed necessary in its discretion. The City Code has development standards, contracting requirements and other legal requirements related to the construction and payment of public improvements and related to certain operation activities. Relating to these, the Districts shall comply with the following requirements: A. Development Standards. The Districts shall ensure that the Public Improvements are designed and constructed in accordance with the standards and specifications of the City Code and of other governmental entities having proper jurisdiction, as applicable. The Districts directly, or indirectly through any Developer, will obtain the City’s approval of civil engineering plans and will obtain applicable permits for construction and installation of Public Improvements prior to performing such work. Unless waived by the City Council, the Districts shall be required, in accordance with the City Code, to post a surety bond, letter of credit, or other approved development security for any Public Improvements to be constructed by the Districts. Such development security may be released in the City Manager’s discretion when the constructing District has obtained funds, through Debt issuance or otherwise, adequate to insure the construction of the Public Improvements, unless such release is prohibited by or in conflict with any City Code provision, State law or any agreement approved and entered into under Section IV.B of this Service Plan. Any limitation or requirement concerning the time within which the City must review the Districts’ proposal or application for an Approved Development Plan or other land use approval is hereby waived by the Districts. B. Contracting. The Districts shall comply with all applicable State purchasing, public bidding and construction contracting. C. Land Acquisition and Conveyance. The purchase price of any land or improvements acquired by the Districts from the Developer shall be no more than the then-current fair market value as confirmed by an independent MAI appraisal for land and by an independent professional engineer for improvements. Land, easements, improvements and facilities conveyed to the City shall be free and clear of all liens, encumbrances and easements, unless otherwise approved by the City Manager prior to conveyance. All conveyances to the City shall be by special warranty deed, shall be conveyed at no cost to the City, shall include an ALTA title policy issued to the City, shall meet the environmental standards of the City and shall comply with any other conveyance prerequisites required in the City Code. 12 D. Equal Employment and Discrimination. In connection with the performance of all acts or activities hereunder, the Districts shall not discriminate against any person otherwise qualified with respect to its hiring, discharging, promoting or demoting or in matters of compensation solely because of race, color, religion, national origin, gender, age, military status, sexual orientation, gender identity or gender expression, marital status, or physical or mental disability, and further shall insert the foregoing provision in contracts or subcontracts entered into by the Districts to accomplish the purposes of this Service Plan. IX. FINANCIAL PLAN/PROPOSED DEBT This Section IX of the Service Plan describes the nature, basis, method of funding and financing limitations associated with the acquisition, construction, completion, repair, replacement, operation and maintenance of Public Improvements. A. Financial Plan. The Districts’ Financial Plan, attached as Exhibit F and incorporated by reference, reflects the Districts’ anticipated schedule for incurring Debt to fund Public Improvements in support of the Project. The Financial Plan also reflects the schedule of all anticipated revenues flowing to the Districts derived from Districts’ mill levies, Fees imposed by the Districts, specific ownership taxes, and all other anticipated legally available revenues. The Financial Plan is based on economic, political and industry conditions as they exist presently and reasonable projections and estimates of future conditions. These projections and estimates are not to be interpreted as the only method of implementation of the Districts’ goals and objectives but rather a representation of one feasible alternative. Other financial structures may be used so long they are in compliance with this Service Plan. The Financial Plan incorporates all of the provisions of this Section IX. Based upon the assumptions contained therein, the Financial Plan projects the issuance of Bonds to fund Public Improvements and anticipated Debt repayment based on the development assumptions and absorptions of the property in the Service Area by End Users. The Financial Plan anticipates that the Districts will acquire, construct, and complete all of the Public Improvements needed to serve the Service Area. The Financial Plan demonstrates that the Districts will have the financial ability to discharge all Debt to be issued as part of the Financial Plan on a reasonable basis. Furthermore, the Districts will secure the certification of an External Financial Advisor who will provide an opinion as to whether such Debt issuances are in the best interest of the Districts at the time of issuance. B. Mill Levies. It is anticipated that the Districts will impose a Debt Mill Levy and an Operating Mill Levy on all property within the Service Area. In doing so, the following shall apply: 1. Aggregate Mill Levy Maximum The Aggregate Mill Levy shall not exceed in any year the Aggregate Mill Levy Maximum, which is fifty (50) mills. 13 2. Regional Mill Levy Not Included in Other Mill Levies The Regional Mill Levy shall not be counted against the Aggregate Mill Levy Maximum. 3. Operating Mill Levy Each District may impose an Operating Mill Levy of up to fifty (50) mills until such District imposes a Debt Mill Levy. Once a District imposes a Debt Mill Levy of any amount, such District’s Operating Mill Levy shall not exceed ten (10) mills at any point. 4. Gallagher Adjustments In the event the State’s method of calculating assessed valuation for the Taxable Property changes after January 1, 2018, or any subsequent constitutionally mandated tax credit, cut or abatement, the Districts’ Aggregate Mill Levy, Debt Mill Levy, Operating Mill Levy, and Aggregate Mill Levy Maximum, amounts herein provided may be increased or decreased to reflect such changes; such increases or decreases shall be determined by the District’s Board in good faith so that to the extent possible, the actual tax revenues generated by such mill levies, as adjusted, are neither enhanced nor diminished as a result of such change occurring after January 1, 2018. For purposes of the foregoing, a change in the ratio of actual valuation to assessed valuation will be a change in the method of calculating assessed valuation. 5. Excessive Mill Levy Pledges Any Debt issued with a mill levy pledge, or which results in a mill levy pledge, that exceeds the Aggregate Mill Levy Maximum or the Maximum Debt Mill Levy Imposition Term, shall be deemed a material modification of this Service Plan and shall not be an authorized issuance of Debt unless and until such material modification has been approved by a Service Plan Amendment. 6. Refunding Debt The Maximum Debt Mill Levy Imposition Term may be exceeded for Debt refunding purposes if: (1) a majority of the issuing District’s Board is composed of End Users and have voted in favor of a refunding of a part or all of the Debt; or (2) such refunding will result in a net present value savings. 7. Maximum Debt Authorization The Districts anticipate approximately Forty Three Million Nine Hundred Eighty One Thousand Fifty Dollars ($43,981,050) in project costs in 2018 dollars as set forth in Exhibit D, and anticipate issuing approximately Twenty Two Million Four Hundred Twenty Nine Thousand Seven Hundred Fifty Dollars ($22,429,750) in Debt to pay such costs as set forth in Exhibit F, which Debt issuance amount shall be the amount of the Maximum Debt Authorization. The Districts collectively shall not issue Debt in excess of the Maximum Debt Authorization. In addition, no District shall issue any Debt 14 unless and until delivery of the relevant portion of the Public Benefits have been secured as required in Section IV.B of this Service Plan. Bonds, loans, notes or other instruments which have been refunded shall not count against the Maximum Debt Authorization. Intergovernmental Capital Pledge Agreements among two or more of the Districts pledging the collection and payment of property taxes or Fees by one District for the repayment of Debt by a separate issuing District shall not count against the Maximum Debt Authorization. The Districts must seek prior resolution approval by the City Council to issue Debt in excess of the Maximum Debt Authorization to pay the actual costs of the Public Improvements set forth in Exhibit D plus inflation, contingencies and other unforeseen expenses associated with such Public Improvements. Such approval by the City Council shall not constitute a material modification of this Service Plan requiring a Service Plan Amendment so long as increases are reasonably related to the Public Improvements set forth in Exhibit D and any Approved Development Plan. C. Maximum Voted Interest Rate and Underwriting Discount. The interest rate on any Debt is expected to be the market rate at the time the Debt is issued. The maximum interest rate on any Debt, including any defaulting interest rate, is not permitted to exceed Twelve Percent (12%). The maximum underwriting discount shall be three percent (3%). Debt, when issued, will comply with all relevant requirements of this Service Plan, the Special District Act, other applicable State law and federal law as then applicable to the issuance of public securities. D. Interest Rate and Underwriting Discount Certification. The Districts shall retain an External Financial Advisor to provide a written opinion on the market reasonableness of the interest rate on any Debt and any underwriter discount paid by the Districts as part of a Debt financing transaction. The Districts shall provide this written opinion to the City before issuing any Debt based on it. E. Disclosure to Purchasers. In order to notify future End Users who are purchasing residential lots or dwellings units in the Service Area that they will be paying, in addition to the property taxes owed to other taxing governmental entities, the property taxes imposed under the Debt Mill Levy, the Operating Mill Levy and possibly the Regional Mill Levy, the Districts shall not be authorized to issue any Debt under this Service Plan until there is included in the Developer’s Approved Development Plan provisions that require the following: 1. That the Developer, and its successors and assigns, shall prepare and submit to the City Manager for his approval a disclosure notice in substantially the form attached hereto as Exhibit H (the “Disclosure Notice”); 2. That when the Disclosure Notice is approved by the City Manager, the Developer shall record the Disclosure Notice in the Larimer County Clerk and Recorders Office; and 3. That the approved Disclosure Notice shall be provided by the Developer, and by its successors and assigns, to each potential End User purchaser of a residential lot or 15 dwelling unit in the Service Area before that purchaser enters into a written agreement for the purchase and sale of that residential lot or dwelling unit. F. External Financial Advisor. An External Financial Advisor shall be retained by the Districts to provide a written opinion as to whether any Debt issuance is in the best interest of the issuing District once the total amount of Debt issued by the Districts exceeds Five Million Dollars ($5,000,000). The External Financial Advisor is to provide advice to the issuing District’s Board regarding the proposed terms and whether Debt conditions are reasonable based upon the status of development within the District, the projected tax base increase in the District, the security offered and other considerations as may be identified by the Advisor. The issuing District shall include in the transcript of any Bond transaction, or other appropriate financing documentation for related Debt instrument, a signed letter from the External Financial Advisor providing an official opinion on the structure of the Debt, stating the Advisor’s opinion that the cost of issuance, sizing, repayment term, redemption feature, couponing, credit spreads, payment, closing date, and other material transaction details of the proposed Debt serve the best interest of the issuing District. Debt shall not be undertaken by the Districts if found to be unreasonable by the External Financial Advisor. G. Disclosure to Debt Purchasers. Any Debt of the Districts shall set forth a statement in substantially the following form: “By acceptance of this instrument, the owner of this Debt agrees and consents to all of the limitations with respect to the payment of the principal and interest on this Debt contained herein, in the resolution of the District authorizing the issuance of this Debt and in the Service Plan of the District. This Debt is not and cannot be a Debt of the City of Fort Collins” Similar language describing the limitations with respect to the payment of the principal and interest on Debt set forth in this Service Plan shall be included in any document used for the offering of the Debt for sale to persons, including, but not limited to, a Developer of property within the Service Area. H. Security for Debt. The Districts shall not pledge any revenue or property of the City as security for the indebtedness set forth in this Service Plan. Approval of this Service Plan shall not be construed as a guarantee by the City of payment of any of the Districts’ obligations; nor shall anything in the Service Plan be construed so as to create any responsibility or liability on the part of the City in the event of default by the Districts in the payment of any such obligations. I. TABOR Compliance. The Districts shall comply with the provisions of TABOR. In the discretion of the Boards, the Districts may set up other qualifying entities to manage, fund, construct and operate facilities, services, and programs. To the extent allowed by law, any entity created by a District will remain under the control of the District’s Board. 16 J. Districts’ Operating Costs. The estimated cost of acquiring land, engineering services, legal services and administrative services, together with the estimated costs of the Districts’ organization and initial operations, are anticipated to be $200,000, which will be eligible for reimbursement from Debt proceeds. In addition to the capital costs of the Public Improvements, the Districts will require operating funds for administration and to plan and cause the Public Improvements to be operated and maintained. The first year’s operating budget is estimated to be $100,000. Ongoing administration, operations and maintenance costs may be paid from property taxes collected through the imposition of an Operating Mill Levy as set forth in Section IX.B.3 of this Service Plan, as well as other revenues legally available to the Districts. X. REGIONAL IMPROVEMENTS The Districts shall be authorized to provide for the planning, design, acquisition, funding, construction, installation, relocation, redevelopment, administration and overhead costs related to the provision of Regional Improvements. At the discretion of the City, the Districts shall impose a Regional Improvement Mill Levy on all property within the Districts’ boundaries under the following terms: A. Regional Mill Levy Authority. The Districts shall seek the authority to impose an additional Regional Mill Levy of five (5) mills as part of the Districts’ initial TABOR election. The Districts shall also seek from the electorate in that election the authority under TABOR to enter into an intergovernmental agreement with the City obligating the Districts to pay as a multiple-fiscal year obligation the proceeds from the Regional Mill Levy to the City. Obtaining voter-approval of the Regional Mill Levy and this intergovernmental agreement shall be a precondition to the Districts issuing any Debt and imposing the Operating Mill Levy, the Debt Mill Levy and any Fees for the repayment of Debt under this Service Plan. B. Regional Mill Levy Imposition. The Districts shall each impose the Regional Mill Levy at a rate not to exceed five (5) mills within one year of receiving written notice from the City Manager to the Districts requesting the imposition of the Regional Mill Levy and stating the mill rate to be imposed. C. City Notice Regarding Regional Improvements. Such notice from the City shall provide a description of the Regional Improvements to be constructed and an analysis explaining how the Regional Improvements will be beneficial to property owners within the Service Area. The City shall make a good faith effort to require planned developments that (i) are adjacent to the Service Area and (ii) will benefit from the Regional Improvement also impose a Regional Mill Levy, to the extent possible. D. Regional Improvements Authorized Under Service Plan. If the Districts are so notified by the City Manager, the Regional Improvements shall be considered public improvements that the Districts would otherwise be authorized to design, construct, install re-design, re-construct, repair or replace pursuant to this Service Plan and applicable law. 17 E. Expenditure of Regional Mil Levy Revenues. Revenue collected through the imposition of the Regional Mill Levy shall be expended as follows: 1. Intergovernmental Agreement If the City and the Districts have executed an intergovernmental agreement concerning the Regional Improvements, then the revenue from the Regional Mill Levy shall be used in accordance with such agreement; or 2. No Intergovernmental Agreement If no intergovernmental agreement exists between the Districts and the City, then the revenue from the Regional Mill Levy shall be paid to the City, for use by the City in the planning, designing, constructing, installing, acquiring, relocating, redeveloping or financing of Regional Improvements which benefit the End Users of the Districts as prioritized and determined by the City. F. Regional Mill Levy Term. The imposition of the Regional Mill Levy shall not exceed a term of twenty-five (25) years from December 31 of the tax collection year after which the Regional Mill Levy is first imposed. G. Completion of Regional Improvements. All Regional Improvements shall be completed prior to the end of the twenty-five (25) year Regional Mill Levy term. H. City Authority to Require Imposition. The City’s authority to require the initiation of the imposition of a Regional Mill Levy shall expire fifteen (15) years after December 31st of the year in which a District first imposes a Debt Mill Levy. I. Regional Mill Levy Not Included in Other Mill Levies. The Regional Mill Levy imposed shall not be applied toward the calculation of the Aggregate Mill Levy Maximum. J. Gallagher Adjustment. In the event the method of calculating assessed valuation is changed after January 1, 2018, or any subsequent constitutionally mandated tax credit, cut or abatement, the Regional Mill Levy may be increased or shall be decreased to reflect such changes; such increases or decreases shall be determined by the Districts’ Boards in good faith so that to the extent possible, the actual tax revenues generated by the Regional Mill Levy, as adjusted, are neither enhanced nor diminished as a result of such change occurring after January 1, 2018. For purposes of the foregoing, a change in the ratio of actual valuation to assessed valuation will be a change in the method of calculating assessed valuation XI. CITY FEES The Districts shall pay all applicable City fees as required by the City Code. 18 XII. BANKRUPTCY LIMITATIONS All of the limitations contained in this Service Plan, including, but not limited to, those pertaining to the Aggregate Mill Levy Maximum, Maximum Debt Mill Levy Imposition Term and Fees, have been established under the authority of the City in the Special District Act to approve this Service Plan. It is expressly intended that by such approval such limitations: (i) shall not be set aside for any reason, including by judicial action, absent a Service Plan Amendment; and (ii) are, together with all other requirements of State law, included in the “political or governmental powers” reserved to the State under the U.S. Bankruptcy Code (11 U.S.C.) Section 903, and are also included in the “regulatory or electoral approval necessary under applicable non-bankruptcy law” as required for confirmation of a Chapter 9 Bankruptcy Plan under Bankruptcy Code Section 943(b)(6). XIII. ANNUAL REPORTS AND BOARD MEETINGS A. General. Each of the Districts shall be responsible for submitting an annual report to the City Clerk no later than September 1st of each year following the year in which the Order and Decree creating the Districts have been issued. The Districts may file a consolidated annual report. The annual report may be made available to the public on the City’s website. B. Board Meetings. Each of the Districts’ Boards shall hold at least one public board meeting in three of the four quarters of each calendar year, beginning in the first full calendar year after the Districts’ creation. Notice for each of these meetings shall be given in accordance with the requirements of the Special District Act and other applicable State Law. This meeting requirement shall not apply until there is at least one End User of property within the District. Also, this requirement shall no longer apply when a majority of the directors on the District’s Board are End Users. C. Report Requirements. Unless waived by the City Manager, each of the Districts’ annual report must include the following: 1. Narrative A narrative summary of the progress of the District in implementing its Service Plan for the report year. 2. Financial Statements Except when exemption from audit has been granted for the report year under the Local Government Audit Law, the audited financial statements of the District for the report year including a statement of financial condition (i.e., balance sheet) as of December 31 of the report year and the statement of operation (i.e., revenue and expenditures) for the report year. 19 3. Capital Expenditures Unless disclosed within a separate schedule to the financial statements, a summary of the capital expenditures incurred by the District in development of improvements in the report year. 4. Financial Obligations Unless disclosed within a separate schedule to the financial statements, a summary of financial obligations of the District at the end of the report year, including the amount of outstanding Debt, the amount and terms of any new District Debt issued in the report year, the total assessed valuation of all Taxable Property within the Service Area as of January 1 of the report year and the current total District mill levy pledged to Debt retirement in the report year. 5. Board Contact Information The names and contact information of the current directors on the District’s Board, any District manager and the attorney for the District shall be listed in the report. The District’s current office address, phone number, email address and any website address shall also be listed in the report. 6. Other Information Any other information deemed relevant by the City Council or deemed reasonably necessary by the City Manager. D. Reporting of Significant Events. The annual report of each District shall also include information as to any of the following that occurred during the report year: 1. Boundary changes made or proposed to the District’s boundaries as of December 31 of the report year. 2. Intergovernmental Agreements with other governmental entities, either entered into or proposed as of December 31 of the report year. 3. Copies of the District’s rules and regulations, if any, or substantial changes to the District’s rules and regulations as of December 31 of the report year. 4. A summary of any litigation which involves the District’s Public Improvements as of December 31 of the report year. 5. A list of all facilities and improvements constructed by the District that have been dedicated to and accepted by the City as of December 31 of the report year. 6. Notice of any uncured events of default by the District, which continue beyond a ninety (90) day period, under any Debt instrument. 7. Any inability of the District to pay its obligations as they come due, in accordance with the terms of such obligations, which continue beyond a ninety (90) day period. 20 E. Failure to Submit. In the event the annual report is not timely received by the City Clerk or is not fully responsive, notice of such default shall be given to the District’s Board at its last known address. The failure of the District to file the annual report within forty-five (45) days of the mailing of such default notice by the City Clerk may constitute a material modification of the Service Plan, at the discretion of the City Manager. XIV. SERVICE PLAN AMENDMENTS This Service Plan is general in nature and does not include specific detail in some instances. The Service Plan has been designed with sufficient flexibility to enable the Districts to provide required improvements, services and facilities under evolving circumstances without the need for numerous amendments. Modification of the general types of improvements and facilities making up the Public Improvements, and changes in proposed configurations, locations or dimensions of the Public Improvements, shall be permitted to accommodate development needs provided such Public Improvements are consistent with the then-current Approved Development Plans for the Project and any agreement approved by City Council pursuant Section IV.B of this Service Plan. Any action of one or more of the Districts, which is a material modification of this Service Plan requiring a Service Plan Amendment as provided in Section XV of this Service Plan or that is a violation or breach of any other provision of this Service Plan, shall be deemed to be a material modification to this Service Plan unless otherwise expressly provided in this Service Plan. All other departures from the provisions of this Service Plan shall be considered on a case-by-case basis as to whether such departures are a material modification under this Service Plan or the Special District Act. XV. MATERIAL MODIFICATIONS Material modifications to this Service Plan may be made only in accordance with C.R.S. Section 32-1-207 as a Service Plan Amendment. No modification shall be required for an action of the Districts that does not materially depart from the provisions of this Service Plan, unless otherwise provided in this Service Plan. Departures from the Service Plan by any of the Districts that constitute a material modification requiring a Service Plan Amendment include, without limitation: 1. Actions or failures to act that create materially greater financial risk or burden to the taxpayers of any of the Districts; 2. Performance of a service or function, construction of an improvement, or acquisition of a major facility that is not closely related to an improvement, service, function or facility authorized in the Service Plan; 3. Failure to perform a service or function, construct an improvement or acquire a facility required by the Service Plan; and 4. Failure to comply with any of the preconditions, prohibitions, limitations and restrictions of this Service Plan. XVI. DISSOLUTION Upon independent determination by the City Council that the purposes for which any District was created have been accomplished, the District shall file a petition in district court for 21 dissolution as provided in the Special District Act. In no event shall dissolution occur until such District has provided for the payment or discharge of all of its outstanding indebtedness and other financial obligations as required pursuant to the Special District Act or any other applicable State law. In addition, if within three (3) years from the date of the City Council’s approval of this Service Plan no agreement contemplated under Section IV.B of this Service Plan has been entered into by the City with any of the Districts and/or any Developer, despite the parties conducting good faith negotiations attempting to do so, the City may opt to pursue the remedies available to it under C.R.S. Section 32-1-701(3) in order to compel the Districts to dissolve in a prompt and orderly manner. In such event: (i) the limited purposes and powers of the Districts, as authorized herein, shall automatically terminate and be expressly limited to taking only those actions that are reasonably necessary to dissolve; (ii) the Board of Directors of each of the Districts will be deemed to have agreed with the City regarding its dissolution without an election pursuant to C.R.S. §32- 1-704(3)(b); (iii) the Districts shall take no action to contest or impede the dissolution of the Districts and shall affirmatively and diligently cooperate in securing the final dissolution of the Districts, and (iv) subject to the statutory requirements of the Special District Act, the Districts shall thereupon dissolve. XVII. SANCTIONS Should any of the Districts undertake any act without obtaining prior City Council approval or consent or City Manager approval or consent under this Service Plan, that constitutes a material modification to this Service Plan requiring a Service Plan Amendment as provided herein or under the Special Districts Act, or that violates or is in breach of any provision of this Service Plan, the City Council may impose one (1) or more of the following sanctions, as it deems appropriate: 1. Exercise any applicable remedy under the Special District Act; 2. Withhold the issuance of any permit, authorization, acceptance or other administrative approval, or withhold any cooperation, necessary for the District’s development or construction or operation of improvements or provision of services; 3. Exercise any legal remedy under the terms of any intergovernmental agreement under which the District is in default; or 4. Exercise any other legal and equitable remedy available under the law, including seeking prohibitory and mandatory injunctive relief against the District, to ensure compliance with the provisions of the Service Plan or applicable law. XVIII. CONCLUSION It is submitted that this Service Plan, as required by C.R.S. Section 32-1-203(2), establishes that: 1. There is sufficient existing and projected need for organized service in the Service Area to be served by the Districts; 2. The existing service in the Service Area to be served by the Districts is inadequate for present and projected needs; 22 3. The Districts are capable of providing economical and sufficient service to the Service Area; and 4. The Service Area does have, and will have, the financial ability to discharge the proposed indebtedness on a reasonable basis. XIX. RESOLUTION OF APPROVAL The Districts agree to incorporate the City Council’s resolution approving this Service Plan, including any conditions imposed by the City Council on such approval, into the copy of the Service Plan presented to the District Court for and in Larimer County, Colorado. EXHIBIT A-1 Legal Description of District No. 1 Boundaries Page 1 of 1 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 | 970.221.4158 GREELEY: 820 8th Street, 80631 | 970.395.9880 | WEB: www.northernengineering.com Exhibit A-1 DESCRIPTION: THRIVE-WATERFIELD METROPOLITAN DISTRICT 1 BOUNDARY A Tract of land located in the West Half of Section 5, Township 7 North, Range 68 West, City of Fort Collins, County of Larimer, State of Colorado being more particularly described as follows: Considering the South line of the Southwest Quarter of said Section 5 as bearing South 88°53'23" East and with all bearings contained herein relative thereto: COMMENCING at the Southwest Corner of said Section 5; thence along the West line of said Southwest Quarter, North 00° 43' 26" East, 176.00 feet to the POINT OF BEGINNING; thence along said West line, North 00° 43' 26" East, 583.78 to the Northerly line of Tract A, Waterfield Third Subdivision; thence along said Northerly line, South 89° 21' 34" East, 76.81 feet; thence along the Easterly right-of-way line of Larimer County Road 11 and along a curve concave to the East having a central angle of 06° 27' 15" with a radius of 1032.00 feet, an arc length of 116.25 feet and the chord of which bears North 07° 34' 25" West, 116.19 feet; thence along the North right-of-way line of New Vine Drive the following 5 courses and distances: South 89° 21' 34" East, 315.58 feet; thence along a curve concave to the North having a central angle of 10° 20' 29" with a radius of 1017.50 feet, an arc length of 183.65 feet and the chord of which bears North 85° 28' 12" East, 183.40 feet; thence, North 80° 17' 57" East, 788.29 feet; thence along a curve concave to the South having a central angle of 10° 43' 43" with a radius of 1132.50 feet, an arc length of 212.06 feet and the chord of which bears North 85° 39' 49" East, 211.75 feet; thence, South 88° 58' 20" East, 1021.66 feet to the West right-of-way line of Timberline Drive; thence along said West right-of-way line, South 00° 16' 52" West, 130.01 feet; thence along the South line of Tract J, Waterfield Third Filing, North 88° 58' 20" West, 991.58 feet; thence along the Easterly line of Merganser Drive the following 4 courses and distances: along a curve concave to the Southeast having a central angle of 04° 17' 22" with a radius of 1361.68 feet, an arc length of 101.94 feet and the chord of which bears South 17° 03' 36" West, 101.92 feet; thence along a curve concave to the Northwest having a central angle of 04° 47' 14" with a radius of 1361.68 feet, an arc length of 113.77 feet and the chord of which bears South 17° 18' 32" West, 113.74 feet; thence along a curve concave to the Southeast having a central angle of 18° 39' 57" with a radius of 662.94 feet, an arc length of 215.97 feet and the chord of which bears South 10° 22' 10" West, 215.02 feet; thence, South 01° 02' 11" West, 478.43 feet; thence along the North right-of-way line of East Vine Drive, North 88° 53' 23" West, 1425.13 feet; thence along the Southerly portion of Tract A, Waterfield Third Filing the following 2 courses and distances: North 00° 43' 26" East, 140.34 feet; thence, North 89° 16' 22" West, 50.67 feet to the POINT OF BEGINNING, containing 1,484,373 square feet or 34.077 acres more or less. AND A Tract of land located in the West Half of Section 5, Township 7 North, Range 68 West, City of Fort Collins, County of Larimer, State of Colorado being more particularly described as follows: Considering the West line of the Southwest Quarter of said Section 5 as bearing North 00°43'27” East and with all bearings contained herein relative thereto: COMMENCING at the Southwest Corner of said Section 5; thence along the West line of said Southwest Quarter, North 00°43’27” East, 1126.91 feet; thence departing said West line, South 89°16’33” East, 1073.16 feet to the POINT OF BEGINNING; thence, North 05°42’56” East, 75.54 feet; thence, North 06°55’57” West, 37.26 feet; thence, North 10°39’38” West, 79.30 feet; thence, North 62°38’46” East, 226.84 feet; thence, South 27°21’14” East, 174.18 feet; thence, South 62°38’46” West, 303.84 feet to the POINT OF BEGINNING, containing 44,969 square feet or 1.03 acres more or less. The above described Tracts of land contains 1,529,342 square feet or 35.11 acres more or less and is subject to all easements and rights-of-way now on record or existing. August 27, 2018 CNS D:\Projects\1496-001\Metro District\Exhibit A\1496-001z_District 1.docx EXHIBIT A-2 Legal Description of District No. 2 Boundaries Page 1 of 2 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 | 970.221.4158 GREELEY: 820 8th Street, 80631 | 970.395.9880 | WEB: www.northernengineering.com Exhibit A-2 DESCRIPTION: THRIVE-WATERFIELD METROPOLITAN DISTRICT 2 BOUNDARY A Tract of land located in the West Half of Section 5, Township 7 North, Range 68 West, City of Fort Collins, County of Larimer, State of Colorado being more particularly described as follows: Considering the South line of the Southwest Quarter of said Section 5 as bearing South 88°53'23" East and with all bearings contained herein relative thereto: COMMENCING at the West Quarter Corner of said Section 5; thence, South 78° 52' 45" East, 56.93 feet to the POINT OF BEGINNING; thence along the South right-of-way line of Conifer Street the following 3 courses and distances: along a curve concave to the Southeast having a central angle of 89° 34' 44" with a radius of 15.00 feet, an arc length of 23.45 feet and the chord of which bears North 45° 30' 48" East, 21.14 feet; thence, South 89° 41' 50" East, 143.70 feet; thence along a curve concave to the North having a central angle of 25° 31' 24" with a radius of 1075.00 feet, an arc length of 478.87 feet and the chord of which bears North 77° 32' 29" East, 474.92 feet; thence along the Northeasterly line of Tract R and the Northeasterly line of Tract K the following 6 courses and distances: South 61° 27' 39" East, 97.20 feet; thence, South 70° 16' 39" East, 260.00 feet; thence, South 59° 46' 39" East, 389.00 feet; thence, South 53° 31' 39" East, 176.30 feet; thence, South 55° 39' 22" East, 234.78 feet; thence, South 63° 17' 47" East, 104.72 feet; thence along the Northerly line of Tract A, Waterfield P.U.D. First Filing the following 8 courses and distances: thence, South 30° 54' 04" West, 0.29 feet; thence, South 65° 28' 27" East, 13.60 feet; thence, South 83° 09' 44" East, 187.84 feet; thence, North 88° 03' 21" East, 295.91 feet; thence, North 84° 51' 19" East, 153.85 feet; thence, North 74° 44' 55" East, 133.22 feet; thence along the West right-of-way line of Timberline Road the following 3 courses and distances: South 00° 17' 16" West, 54.54 feet; thence, South 79° 42' 44" East, 1.91 feet; thence, South 00° 16' 52" West, 1025.14 feet; thence along the North right-of-way line of New Vine Drive the following 3 courses and distances: North 88° 58' 20" West, 1021.66 feet; thence along a curve concave to the South having a central angle of 10° 43' 43" with a radius of 1132.50 feet, an arc length of 212.06 feet and the chord of which bears South 85° 39' 49" West, 211.75 feet; thence, South 80° 17' 57" West, 479.85 feet; thence along the Westerly line of Tract I, Waterfield Third Filing the following 8 courses and distances: thence, North 09° 42' 03" West, 29.65 feet; thence along a curve concave to the Northeast having a central angle of 65° 36' 07" with a radius of 133.55 feet, an arc length of 152.91 feet and the chord of which bears North 48° 28' 48" West, 144.70 feet; thence along a curve concave to the Southwest having a central angle of 60° 52' 28" with a radius of 254.53 feet, an arc length of 270.43 feet and the chord of which bears North 46° 44' 16" West, 257.89 feet; thence along a curve concave to the Northeast having a central angle of 85° 15' 54" with a radius of 276.97 feet, an arc length of 412.18 feet and the chord of which bears North 32° 37' 02" West, 375.18 feet; thence, North 13° 37' 13" East, 264.08 feet; thence along a curve concave to the Southeast having a central angle of 75° 39' 02" with a radius of 132.37 feet, an arc length of 174.77 feet and the chord of which bears North 52° 17' 36" East, 162.35 feet; thence along a curve concave to the North having a central angle of 36° 41' 13" with a radius of 440.75 feet, an arc length of 282.22 feet and the chord of which bears North 77° 40' 27" East, 277.42 feet; thence, North 00° 17' 33" East, 382.29 feet; thence along the South line of Tract N, Waterfield Third Filing, North 85° 41' 52" West, 749.41 feet; thence, North 00° 43' 26" East, 154.17 feet to the POINT OF BEGINNING. The above described Tract of land contains 2,607,911 square feet or 59.87 acres more or less and is subject to all easements and rights-of-way now on record or existing. August 27, 2018 CNS D:\Projects\1496-001\Metro District\Exhibit A\1496-001_District 2.docx Page 2 of 2 EXHIBIT A-3 Legal Description of District No. 3 Boundaries Page 1 of 1 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 | 970.221.4158 GREELEY: 820 8th Street, 80631 | 970.395.9880 | WEB: www.northernengineering.com Exhibit A-3 DESCRIPTION: THRIVE-WATERFIELD METROPOLITAN DISTRICT 3 BOUNDARY A Tract of land located in the West Half of Section 5, Township 7 North, Range 68 West, City of Fort Collins, County of Larimer, State of Colorado being more particularly described as follows: Considering the West line of the Southwest Quarter of said Section 5 as bearing North 00°43'27” East and with all bearings contained herein relative thereto: COMMENCING at the Southwest Corner of said Section 5; thence along the West line of said Southwest Quarter, North 00°43’27” East, 1126.91 feet; thence departing said West line, South 89°16’33” East, 1073.16 feet to the POINT OF BEGINNING; thence, North 05°42’56” East, 75.54 feet; thence, North 06°55’57” West, 37.26 feet; thence, North 10°39’38” West, 79.30 feet; thence, North 62°38’46” East, 226.84 feet; thence, South 27°21’14” East, 174.18 feet; thence, South 62°38’46” West, 303.84 feet to the POINT OF BEGINNING. The above described Tract of land contains 44,969 square feet or 1.03 acres more or less and is subject to all easements and rights-of-way now on record or existing. August 27, 2018 CNS D:\Projects\1496-001\Metro District\Exhibit A\1496-001z_District 1.docx EXHIBIT B-1 District No. 1 Boundary Map OVERALL DISTRICT BOUNDARY E VINE DR SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W DISTRICT 1 1,484,373 sq.ft. 34.08 ac N TIMBERLINE RD DISTRICT 1 BOUNDARY DISTRICT 1 44,969 sq.ft. 1.03 ac DISTRICT 1 BOUNDARY THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 27, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com DISTRICT 1 AREA BOUNDARY MAP 1" = 400' B-1 ( US SURVEY FEET ) 1 inch = ft. 0 Feet NOTE: THIS EXHIBIT IS NOT INTENDED TO BE A MONUMENTED LAND SURVEY. ITS SOLE PURPOSE IS AS A GRAPHIC REPRESENTATION TO AID IN THE VISUALIZATION OF THE WRITTEN PROPERTY DESCRIPTION WHICH IT ACCOMPANIES. THE WRITTEN PROPERTY DESCRIPTION SUPERCEDES THE EXHIBIT DRAWING. 400 400 400 EXHIBIT B-2 District No. 2 Boundary Map N TIMBERLINE RD OVERALL DISTRICT BOUNDARY E VINE DR DISTRICT 2 BOUNDARY SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W DISTRICT 2 2,607,911 sq.ft. 59.87 ac THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 27, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com DISTRICT 2 AREA BOUNDARY MAP 1" = 400' B-2 ( US SURVEY FEET ) 1 inch = ft. 0 Feet NOTE: THIS EXHIBIT IS NOT INTENDED TO BE A MONUMENTED LAND SURVEY. ITS SOLE PURPOSE IS AS A GRAPHIC REPRESENTATION TO AID IN THE VISUALIZATION OF THE WRITTEN PROPERTY DESCRIPTION WHICH IT ACCOMPANIES. THE WRITTEN PROPERTY DESCRIPTION SUPERCEDES THE EXHIBIT DRAWING. 400 400 400 EXHIBIT B-3 District No. 3 Boundary Map N TIMBERLINE RD OVERALL DISTRICT BOUNDARY E VINE DR DISTRICT 3 BOUNDARY DISTRICT 3 44,969 sq.ft. 1.03 ac SOUTHWEST CORNER SECTION 5-T7-R68W WEST QUARTER CORNER SECTION 5-T7N-R68W WEST LINE OF SECTION 5 THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 27, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 DISTRICT 3 AREA BOUNDARY MAP 1" = 400' B-3 EXHIBIT C Vicinity Map E VINE DR PROPOSED THRIVE - WATERFIELD METROPOLITAN DISTRICT N TIMBERLINE RD MOUNTAIN VISTA DR ADRIEL DR TURNBERRY RD INTERNATIONAL BLVD SYKES DR FORKS DR THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 1000 0 1000 Feet 1000 VICINITY MAP 1" = 1000' C EXHIBIT D Public Improvement Cost Estimates Public Improvements Unit Cost Extended Cost I. Grading/Miscellaneous Mobilization / General Conditions 1 LS $1,455,000.00 $ 1,455,000.00 Clearing and Grubbing and Topsoil Stripping 25 Ac $11,900.00 $ 293,930.00 Earthwork (cut/fill/place) 150,024 CY $6.00 $ 900,144.00 Import Fill Dirt 250,000 CY $10.00 $ 2,500,000.00 Erosion Control / Traffic Control 1 LS $2,079,000.00 $ 2,079,000.00 Subtotal $ 7,228,074.00 II. Roadway Improvements Parking Lots 490 SY $70.00 $ 34,277.00 Access Road (24' Section) - LF $205.00 $ - Local Residential Street (51' Section) 13,428 LF $282.00 $ 3,786,696.00 Local Industrial Street (66' Section) - LF $321.00 $ - Major Collector Street (66' Section) - LF $372.00 $ - Minor Collector Street (76' Section) - LF $431.00 $ - Alley (20' Section) 12,472 EA $133.00 $ 1,658,818.00 4-Lane Arterial - EA $715.00 $ - Boulvard (Custom) 2,120 LF $331.00 $ 701,720.00 Traffic Signal Improvements - EA $500,000.00 $ - Street Lighting 1 LS $248,000.00 $ 248,000.00 Signing and Striping - LS $271,000.00 $ - Subtotal $ 6,429,511.00 III. Potable Waterline Improvements 8" Waterline 19,232 LF $90.00 $ 1,730,880.00 10" Waterline - LF $100.00 $ - 12" Waterline - LF $112.00 $ - Utility Borings - LF $1,900.00 $ - Raw Water Requirements - AC-FT $41,428.00 $ - Off-Site Waterline Reimbursement to Loveland Water and Power - LS $750,000.00 $ - Subtotal $ 1,730,880.00 IV. Sanitary Sewer and Subdrain Improvements 8" Sanitary Sewer 15,697 LF $109.00 $ 1,710,973.00 10" Sanitary Sewer - LF $114.00 $ - 12" Sanitary Sewer - LF $124.00 $ - 15" Sanitary Sewer - LF $131.80 $ - 8" Subdrain 20,111 LF $75.00 $ 1,508,325.00 Subdrain Connection Fee - LS $0.00 $ - Sanitary Sewer Repayment - LS $0.00 $ - Subtotal $ 3,219,298.00 V. Storm Drainage Improvements 8" Underdrain 4,354 LF $75.00 $ 326,550.00 18" RCP Storm Sewer 1,864 LF $181.00 $ 337,384.00 24" RCP Storm Sewer 4,051 LF $191.00 $ 773,741.00 30" RCP Storm Sewer 80 LF $222.00 $ 17,760.00 Outlet Structure 3 EA $10,000.00 $ 30,000.00 Water Quality 63,291 CF $6.00 $ 379,748.00 Subtotal $ 1,865,183.00 SUMMARY ESTIMATE OF PRELIMINARY DISTRICT EXPENDITURES August 7, 2018 BASIC PUBLIC IMPROVEMENT COSTS FOR WATERFIELD METRO DISTRICT Nos. 1-3 Quantity AREA - 92.99 ACRES Page 1 of 2 Public Improvements Unit Cost Extended Cost SUMMARY ESTIMATE OF PRELIMINARY DISTRICT EXPENDITURES August 7, 2018 BASIC PUBLIC IMPROVEMENT COSTS FOR WATERFIELD METRO DISTRICT Nos. 1-3 Quantity AREA - 92.99 ACRES VI. Non-Potable Irrigation Improvements 6" Non-Potable Waterline - LF $56.00 $ - Non-Potable Waterline Pumphouse - LS $450,000.00 $ - Non-Potable Pond and Delivery Improvements - LS $250,000.00 $ - Flood Irrigation System and Appurtences - LS $0.00 $ - Well Head Replacement - EA $27,500.00 $ - Raw Water Requirements - AC-FT $41,428.00 $ - Subtotal $ - VII. Open Space, Parks and Trails Structural Demolition - LS $0.00 $ - Natural Area Open Space 14.62 AC $108,900.00 $ 1,592,210.00 Landscaped Open Space - AC $239,580.00 $ - Regional Trails 13,122 LF $160.00 $ 2,099,520.00 Monument Signs 2 EA $75,000.00 $ 150,000.00 Pocket Park and Park Amenities - EA $150,000.00 $ - Open Space Acquisition - AC $20,000.00 $ - Subtotal $ 3,841,730.00 VIII. Admin. / Design / Permitting / Etc. Engineering / Surveying 1 LS $2,432,000.00 $ 2,432,000.00 Construction Management / Inspection / Testing 1 LS $3,648,000.00 $ 3,648,000.00 Admin. / Planning / Permitting 1 LS $730,000.00 $ 730,000.00 Subtotal $ 6,810,000.00 Infrastructure Subtotal $ 31,124,676.00 Contingency (20%) $ 6,224,936.00 Total Cost $ 37,349,612.00 Page 2 of 2 Public Improvements Unit Cost Extended Cost I. Grading/Miscellaneous Mobilization / General Conditions - LS $1,820,000.00 $ - Clearing and Grubbing and Topsoil Stripping - Ac $11,900.00 $ - Earthwork (cut/fill/place) - CY $6.00 $ - Import Fill Dirt - CY $10.00 $ - Erosion Control / Traffic Control - LS $2,600,000.00 $ - Subtotal $ - II. Roadway Improvements Parking Lots - SY $70.00 $ - Access Road (24' Section) - LF $205.00 $ - Local Residential Street (51' Section) - LF $282.00 $ - Local Industrial Street (66' Section) - LF $321.00 $ - Major Collector Street (66' Section) 1,458 LF $372.00 $ 542,376.00 Minor Collector Street (76' Section) 1,003 LF $431.00 $ 432,293.00 Alley (20' Section) - EA $133.00 $ - 4-Lane Arterial 2,603 EA $715.00 $ 1,861,145.00 Boulvard (Custom) - LF $331.00 $ - Traffic Signal Improvements - EA $500,000.00 $ - Street Lighting - LS $246,000.00 $ - Signing and Striping 1 LS $271,000.00 $ 86,000.00 Subtotal $ 2,921,814.00 III. Potable Waterline Improvements 8" Waterline - LF $90.00 $ - 10" Waterline - LF $100.00 $ - 12" Waterline 6,458 LF $112.00 $ 723,296.00 Utility Borings - LF $1,900.00 $ - Raw Water Requirements - AC-FT $41,428.00 $ - Off-Site Waterline Reimbursement to Loveland Water and Power - LS $750,000.00 $ - Subtotal $ 723,296.00 IV. Sanitary Sewer and Subdrain Improvements 8" Sanitary Sewer - LF $109.00 $ - 10" Sanitary Sewer - LF $114.00 $ - 12" Sanitary Sewer 5,412 LF $124.00 $ 671,088.00 15" Sanitary Sewer - LF $131.80 $ - 8" Subdrain - LF $75.00 $ - Subdrain Connection Fee - LS $0.00 $ - Sanitary Sewer Repayment - LS $0.00 $ - Subtotal $ 671,088.00 V. Storm Drainage Improvements 8" Underdrain - LF $75.00 $ - 18" RCP Storm Sewer - LF $181.00 $ - 24" RCP Storm Sewer - LF $191.00 $ - 30" RCP Storm Sewer - LF $222.00 $ - Outlet Structure - EA $10,000.00 $ - Water Quality - CF $6.00 $ - Subtotal $ - SUMMARY ESTIMATE OF PRELIMINARY DISTRICT EXPENDITURES August 7, 2018 NON-BASIC PUBLIC IMPROVEMENT COSTS FOR WATERFIELD METRO DISTRICT Nos. 1-3 Quantity AREA - 92.99 ACRES Page 1 of 2 Public Improvements Unit Cost Extended Cost SUMMARY ESTIMATE OF PRELIMINARY DISTRICT EXPENDITURES August 7, 2018 NON-BASIC PUBLIC IMPROVEMENT COSTS FOR WATERFIELD METRO DISTRICT Nos. 1-3 Quantity AREA - 92.99 ACRES VI. Non-Potable Irrigation Improvements 6" Non-Potable Waterline - LF $56.00 $ - Non-Potable Waterline Pumphouse - LS $450,000.00 $ - Non-Potable Pond and Delivery Improvements - LS $250,000.00 $ - Flood Irrigation System and Appurtences - LS $0.00 $ - Well Head Replacement - EA $27,500.00 $ - Raw Water Requirements - AC-FT $41,428.00 $ - Subtotal $ - VII. Open Space, Parks and Trails Structural Demolition - LS $0.00 $ - Natural Area Open Space - AC $108,900.00 $ - Landscaped Open Space - AC $239,580.00 $ - Regional Trails - LF $160.00 $ - Monument Signs - EA $75,000.00 $ - Pocket Park and Park Amenities - EA $150,000.00 $ - Open Space Acquisition - AC $20,000.00 $ - Subtotal $ - VIII. Admin. / Design / Permitting / Etc. Engineering / Surveying 1 LS $432,000.00 $ 432,000.00 Construction Management / Inspection / Testing 1 LS $648,000.00 $ 648,000.00 Admin. / Planning / Permitting 1 LS $130,000.00 $ 130,000.00 Subtotal $ 1,210,000.00 Infrastructure Subtotal $ 5,526,198.00 Contingency (20%) $ 1,105,240.00 Total Cost $ 6,631,438.00 Page 2 of 2 EXHIBIT E Public Improvement Maps E VINE DR N TIMBERLINE RD THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 STREET MAP 1" = 400' E FIGURE 1 OF 5 LEGEND: MAJOR COLLECTOR 4-LANE ARTERIAL BOULEVARD NOTE: LOCAL STREETS AND ASSOCIATED UTILITIES ARE CONCEPTUAL AND MAY CHANGE AS DEVELOPMENT OCCURS. STREETS OWNED AND MAINTAINED BY THE CITY OF FORT COLLINS RESIDENTIAL LOCAL ALLEYWAY MINOR COLLECTOR W W W W W 12" WATER 8" WATER W W W W W W W W W W W W W W 8" WATER 8" WATER 12" WATER E VINE DR N TIMBERLINE RD THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 POTABLE WATER MAP 1" = 400' E FIGURE 2 OF 5 LEGEND: WATER LINE - 12 INCH PVC. ALL WATER TO BE OWNED AND MAINTAINED BY ELCO WATER DISTRICT. W WATER LINE - 8 INCH PVC. ALL WATER TO BE OWNED AND MAINTAINED BY ELCO SS SS SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SD SS SS SS SS SS SS SS SS SS SS SS SS SS SS SS SS SS SS SS 8" SANITARY SEWER 12" SANITARY SEWER 8" SUBDRAIN 8" SUBDRAIN 8" SUBDRAIN 8" SANITARY SEWER 8" SANITARY SEWER E VINE DR N TIMBERLINE RD THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION UD UD UD UD UD UD ST ST 24" RCP 24" RCP 18" RCP 18" RCP 30" RCP 18" RCP 24" RCP E VINE DR N TIMBERLINE RD UD UD UD UD 8" PERF. PIPE 8" PERF. PIPE 8" PERF. PIPE 18" RCP THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 STORM DRAINAGE MAP 1" = 400' E FIGURE 4 OF 5 NOTE: LOCAL STREETS LEGEND: AND ASSOCIATED UTILITIES ARE CONCEPTUAL AND MAY CHANGE AS DEVELOPMENT OCCURS. 24" RCP STORM DRAIN LINE ST DIRECTION OF CONVEYANCE DETENTION AREAS 18" RCP STORM DRAIN LINE ST E VINE DR N TIMBERLINE RD THRIVE - WATERFIELD METROPOLITAN DISTRICT FORT COLLINS COLORADO E NGINEER ING N O R T H E RN DESCRIPTION DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 OPEN SPACE, PARKS, & TRAILS MAP 1" = 400' E FIGURE 5 OF 5 LEGEND: CONNECTIVITY LANDSCAPING w/ TRAILS NATURAL AREA OPEN SPACE STREETS w/ TREE LAWN AREAS NOTE: LOCAL STREETS AND ASSOCIATED UTILITIES ARE CONCEPTUAL AND MAY CHANGE AS DEVELOPMENT OCCURS. EXHIBIT F Financial Plan WATERFIELD METROPOLITAN DISTRICT 1 Development Projection at 40.000 (target) District Mills, plus Fees -- SERVICE PLAN -- 07/30/2018 2050 Series 2030, G.O. Bonds, Pay & Cancel Refg of (proposed) Series 2020+New, Assumes Investment Grade, 100x, 30-yr. Maturity 2050 < < < < < < < < Residential > > > > > > > > < Platted/Developed Lots > Mkt Value As'ed Value* As'ed Value District District District Biennial @ 7.20% @ 29.00% Total D/S Mill Levy D/S Mill Levy S.O. Taxes Total Total Total Reasses'mt Cumulative of Market Cumulative of Market Assessed [40.000 Target] Collections Collected Facility Fees Available YEAR Res'l Units @ 6.0% Market Value (2-yr lag) Market Value (2-yr lag) Value [40.000 Cap] @ 98% @ 6% Collections Revenue 2017 0 0 $0 $0 0 $0 $0 $0 2018 0 0 0 0 0 0 0 0 2019 0 0 0 6,369,260 0 0 0 0 0 0 2020 154 0 66,265,781 0 5,218,740 0 0 40.000 0 0 1,540,000 1,540,000 2021 126 121,647,467 0 4,243,100 1,847,085 1,847,085 40.000 72,406 4,344 1,260,000 1,336,750 2022 100 7,298,848 174,874,994 4,771,136 1,734,420 1,513,435 6,284,571 40.000 246,355 14,781 1,000,000 1,261,136 2023 38 194,024,393 8,758,618 1,325,700 1,230,499 9,989,117 40.000 391,573 23,494 380,000 795,068 2024 30 11,641,464 220,595,391 12,591,000 1,325,700 502,982 13,093,981 40.000 513,284 30,797 300,000 844,081 2025 30 235,823,517 13,969,756 883,800 384,453 14,354,209 40.000 562,685 33,761 300,000 896,446 2026 20 14,149,411 260,328,054 15,882,868 0 384,453 16,267,321 40.000 637,679 38,261 200,000 875,940 2027 0 260,328,054 16,979,293 0 256,302 17,235,595 40.000 675,635 40,538 0 716,173 2028 0 15,619,683 275,947,737 18,743,620 0 0 18,743,620 40.000 734,750 44,085 0 778,835 2029 0 275,947,737 18,743,620 0 0 18,743,620 40.000 734,750 44,085 0 778,835 2030 0 16,556,864 292,504,601 19,868,237 0 0 19,868,237 40.000 778,835 46,730 0 825,565 2031 0 292,504,601 19,868,237 0 0 19,868,237 40.000 778,835 46,730 0 825,565 2032 0 17,550,276 310,054,878 21,060,331 0 0 21,060,331 40.000 825,565 49,534 0 875,099 2033 0 310,054,878 21,060,331 0 0 21,060,331 40.000 825,565 49,534 0 875,099 2034 0 18,603,293 328,658,170 22,323,951 0 0 22,323,951 40.000 875,099 52,506 0 927,605 2035 0 328,658,170 22,323,951 0 0 22,323,951 40.000 875,099 52,506 0 927,605 2036 0 19,719,490 348,377,660 23,663,388 0 0 23,663,388 40.000 927,605 55,656 0 983,261 2037 0 348,377,660 23,663,388 0 0 23,663,388 40.000 927,605 55,656 0 983,261 2038 20,902,660 369,280,320 25,083,192 0 0 25,083,192 40.000 983,261 58,996 1,042,257 2039 369,280,320 25,083,192 0 0 25,083,192 40.000 983,261 58,996 1,042,257 2040 22,156,819 391,437,139 26,588,183 0 0 26,588,183 40.000 1,042,257 62,535 1,104,792 2041 391,437,139 26,588,183 0 0 26,588,183 40.000 1,042,257 62,535 1,104,792 2042 23,486,228 414,923,368 28,183,474 0 0 28,183,474 40.000 1,104,792 66,288 1,171,080 2043 414,923,368 28,183,474 0 0 28,183,474 40.000 1,104,792 66,288 1,171,080 2044 24,895,402 439,818,770 29,874,482 0 0 29,874,482 40.000 1,171,080 70,265 1,241,344 2045 439,818,770 29,874,482 0 0 29,874,482 40.000 1,171,080 70,265 1,241,344 2046 26,389,126 466,207,896 31,666,951 0 0 31,666,951 40.000 1,241,344 74,481 1,315,825 2047 466,207,896 31,666,951 0 0 31,666,951 40.000 1,241,344 74,481 1,315,825 2048 27,972,474 494,180,370 33,566,969 0 0 33,566,969 40.000 1,315,825 78,950 1,394,775 2049 494,180,370 33,566,969 0 0 33,566,969 40.000 1,315,825 78,950 1,394,775 2050 29,650,822 523,831,192 35,580,987 0 0 35,580,987 40.000 1,394,775 83,686 1,478,461 2051 523,831,192 35,580,987 0 0 35,580,987 40.000 1,394,775 83,686 1,478,461 2052 31,429,872 555,261,063 37,715,846 0 0 37,715,846 40.000 1,478,461 88,708 1,567,169 2053 555,261,063 37,715,846 0 0 37,715,846 40.000 1,478,461 88,708 1,567,169 2054 33,315,664 588,576,727 39,978,797 0 0 39,978,797 40.000 1,567,169 94,030 1,661,199 2055 588,576,727 39,978,797 0 0 39,978,797 40.000 1,567,169 94,030 1,661,199 2056 35,314,604 623,891,331 42,377,524 0 0 42,377,524 40.000 1,661,199 99,672 1,760,871 2057 623,891,331 42,377,524 0 0 42,377,524 40.000 1,661,199 99,672 1,760,871 2058 37,433,480 661,324,811 44,920,176 0 0 44,920,176 40.000 1,760,871 105,652 1,866,523 2059 661,324,811 44,920,176 0 0 44,920,176 40.000 1,760,871 105,652 1,866,523 2060 39,679,489 701,004,299 47,615,386 0 0 47,615,386 40.000 1,866,523 111,991 1,978,515 ______ __________ __________ __________ __________ __________ 498 473,765,968 42,691,916 2,561,515 4,980,000 50,233,431 [*] RAR @ 7.96% thru 2017, Subject to future changes per Colorado General Assembly. 7/30/2018 F WMD Fin Plan 18 NR LF Fin Plan+2030 Refg SP Prepared by D.A.Davidson & Co. Draft: For discussion purposes only. 1 2050 2050 YEAR 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053 2054 2055 2056 2057 2058 2059 2060 WATERFIELD METROPOLITAN DISTRICT Development Projection at 40.000 (target) District Mills, plus Fees -- SERVICE PLAN -- 07/30/2018 Series 2030, G.O. Bonds, Pay & Cancel Refg of (proposed) Series 2020+New, Assumes Investment Grade, 100x, 30-yr. Maturity Series 2020 Series 2030 $15,655,000 Par $20,930,000 Par Surplus Senior Senior Cov. of Net DS: Cov. of Net DS: [Net $13.675 MM] [Net $9.387 MM] Total Annual Release @ Cumulative Debt/ Debt/ @ 40.000 Target @ 40.000 Cap Net Available Net Debt Net Debt Net Debt Funds on Hand* Surplus 50% D/A Surplus Assessed Act'l Value & 0.0 U.R.A. Mills & 0.0 U.R.A. Mills for Debt Svc Service Service Service Used as Source to $2,093,000 $2,093,000 Target Ratio Ratio + PIF Revs (net) + PIF Revs (net) $0 n/a n/a n/a 0% 0% 0 n/a n/a n/a 0% 0% 0 n/a n/a n/a 0% 0% 1,540,000 $0 $0 1,540,000 $1,540,000 0% 0% 0% 0% 1 2050 2050 YEAR 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 2045 2046 2047 2048 2049 2050 2051 2052 2053 2054 2055 2056 2057 2058 2059 2060 WATERFIELD METROPOLITAN DISTRICT Operations Revenue and Expense Projection -- 07/30/2018 Total Total S.O. Taxes Total Assessed Oper'ns Collections Collected Available Total Value Mill Levy @ 98% @ 6% For O&M Mills 0 10.000000 50.000 1,847,085 10.000 18,101 1,086 19,188 50.000 6,284,571 10.000 61,589 3,695 65,284 50.000 9,989,117 10.000 97,893 5,874 103,767 50.000 13,093,981 10.000 128,321 7,699 136,020 50.000 14,354,209 10.000 140,671 8,440 149,112 50.000 16,267,321 10.000 159,420 9,565 168,985 50.000 WATERFIELD METROPOLITAN DISTRICT Development Projection -- Buildout Plan (updated 7/30/18) 2050 100% 0 Residential Development 3-Story TH SFD Cottage Incr/(Decr) in Incr/(Decr) in Incr/(Decr) in Finished Lot # Units Price Finished Lot # Units Price Finished Lot # Units Price # Lots Value @ Completed Inflated @ Market # Lots Value @ Completed Inflated @ Market # Lots Value @ Completed Inflated @ Market YEAR Devel'd 10% 89 target 2% Value Devel'd 10% 80 target 2% Value Devel'd 10% 200 target 2% Value 2017 0 0 $380,900 0 0 0 $510,900 0 0 0 $441,900 0 2018 0 0 380,900 0 0 0 510,900 0 0 0 441,900 0 2019 36 1,371,240 388,518 0 24 1,226,160 521,118 0 30 1,325,700 450,738 0 2020 36 0 36 396,288 14,266,381 24 0 24 531,540 12,756,969 30 0 30 459,753 13,792,583 2021 17 (723,710) 36 404,214 14,551,709 24 0 24 542,171 13,012,108 30 0 30 468,948 14,068,434 2022 0 (647,530) 17 412,298 7,009,073 8 (817,440) 24 553,015 13,272,350 30 0 30 478,327 14,349,803 2023 0 0 0 420,544 0 0 (408,720) 8 564,075 4,512,599 30 0 30 487,893 14,636,799 2024 0 0 0 428,955 0 0 0 0 575,356 0 30 0 30 497,651 14,929,535 2025 0 0 0 437,534 0 0 0 0 586,864 0 20 (441,900) 30 507,604 15,228,126 2026 0 0 0 446,285 0 0 0 0 598,601 0 0 (883,800) 20 517,756 10,355,126 2027 0 0 0 455,211 0 0 0 0 610,573 0 0 0 0 528,111 0 2028 0 0 0 464,315 0 0 0 0 622,784 0 0 0 0 538,674 0 2029 0 0 0 473,601 0 0 0 0 635,240 0 0 0 0 549,447 0 2030 0 0 0 483,073 0 0 0 0 647,945 0 0 0 0 560,436 0 2031 0 0 0 492,735 0 0 0 0 660,904 0 0 0 0 571,645 0 2032 0 0 0 502,589 0 0 0 0 674,122 0 0 0 0 583,078 0 2033 0 0 0 512,641 0 0 0 0 687,604 0 0 0 0 594,739 0 2034 0 0 0 522,894 0 0 0 0 701,356 0 0 0 0 606,634 0 2035 0 0 0 533,352 0 0 0 0 715,383 0 0 0 0 618,767 0 2036 0 0 0 544,019 0 0 0 0 729,691 0 0 0 0 631,142 0 2037 0 0 554,899 0 0 0 744,285 0 0 0 643,765 0 ______ _________ ______ _________ ______ _________ ______ _________ _____ _________ ______ _________ 89 (0) 89 35,827,163 80 0 80 43,554,026 200 0 200 97,360,406 7/30/2018 F WMD Fin Plan 18 Abs Prepared by D.A. Davidson & Co. 4 2050 100% 0 YEAR 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 WATERFIELD METROPOLITAN DISTRICT Development Projection -- Buildout Plan (updated 7/30/18) Residential Summary 2-Story TH Duplex Incr/(Decr) in Incr/(Decr) in Finished Lot # Units Price Finished Lot # Units Price Total Total Res'l Value +/- of Platted & # Lots Value @ Completed Inflated @ Market # Lots Value @ Completed Inflated @ Market Residential Total Facility Fees Developed Lots Devel'd 10% 101 target 2% Value Devel'd 10% 28 target 2% Value Market Value Res'l Units @ $10,000/unit Adjustment Adjusted Value 0 0 $359,900 0 0 0 $410,900 0 $0 0 0 0 0 0 0 359,900 0 0 0 410,900 0 0 0 0 0 0 36 1,295,640 367,098 0 28 1,150,520 419,118 0 0 0 0 0 6,369,260 36 0 36 374,440 13,479,839 0 (1,150,520) 28 427,500 11,970,010 66,265,781 154 1,540,000 0 (1,150,520) 29 (251,930) 36 381,929 13,749,435 0 0 0 436,050 0 55,381,686 126 1,260,000 0 (975,640) 0 (1,043,710) 29 389,567 11,297,453 0 0 0 444,771 0 45,928,679 100 1,000,000 0 (2,508,680) 0 0 0 397,359 0 0 0 0 453,667 0 19,149,398 38 380,000 0 (408,720) 0 0 0 405,306 0 0 0 0 462,740 0 14,929,535 30 300,000 0 0 0 0 0 413,412 0 0 0 0 471,995 0 15,228,126 30 300,000 0 (441,900) 0 0 0 421,680 0 0 0 0 481,435 0 10,355,126 20 200,000 0 (883,800) 0 0 0 430,114 0 0 0 0 491,064 0 0 0 0 0 0 0 0 0 438,716 0 0 0 0 500,885 0 0 0 0 0 0 0 0 0 447,490 0 0 0 0 510,903 0 0 0 0 0 0 0 0 0 456,440 0 0 0 0 521,121 0 0 0 0 0 0 0 0 0 465,569 0 0 0 0 531,543 0 0 0 0 0 0 0 0 0 474,880 0 0 0 0 542,174 0 0 0 0 0 0 0 0 0 484,378 0 0 0 0 553,017 0 0 0 0 0 0 0 0 0 494,066 0 0 0 0 564,078 0 0 0 0 0 0 0 0 0 503,947 0 0 0 0 575,359 0 0 0 0 0 0 0 0 0 514,026 0 0 0 0 586,866 0 0 0 0 0 0 0 0 524,306 0 0 0 598,604 0 0 0 0 0 0 _____ _________ ______ _________ ______ _________ ________ _________ ___________ ______ ______ _________ _________ 101 0 101 38,526,727 28 0 28 11,970,010 227,238,331 498 4,980,000 0 0 7/30/2018 F WMD Fin Plan 18 Abs Prepared by D.A. Davidson & Co. 5 Jul 30, 2018 11:40 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-20NRSPF) SOURCES AND USES OF FUNDS WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION BONDS, SERIES 2020 40.000 (target) Mills, plus Fees Non-Rated, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Dated Date 12/01/2020 Delivery Date 12/01/2020 Sources: Bond Proceeds: Par Amount 15,655,000.00 15,655,000.00 Uses: Project Fund Deposits: Project Fund 13,674,670.83 Other Fund Deposits: Debt Service Reserve Fund 1,367,229.17 Cost of Issuance: Other Cost of Issuance 300,000.00 Delivery Date Expenses: Underwriter's Discount 313,100.00 15,655,000.00 6 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) SOURCES AND USES OF FUNDS WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Dated Date 12/01/2030 Delivery Date 12/01/2030 Sources: Bond Proceeds: Par Amount 20,930,000.00 Other Sources of Funds: Funds on Hand* 1,550,000.00 Series 2020 - DSRF 1,367,229.17 2,917,229.17 23,847,229.17 Uses: Project Fund Deposits: Project Fund 9,387,329.17 Refunding Escrow Deposits: Cash Deposit* 14,155,250.00 Cost of Issuance: Other Cost of Issuance 200,000.00 Delivery Date Expenses: Underwriter's Discount 104,650.00 23,847,229.17 Note: [*] Estimated balances, (tbd). 7 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) BOND SUMMARY STATISTICS WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Dated Date 12/01/2030 Delivery Date 12/01/2030 First Coupon 06/01/2031 Last Maturity 12/01/2060 Arbitrage Yield 4.000000% True Interest Cost (TIC) 4.035168% Net Interest Cost (NIC) 4.022503% All-In TIC 4.103068% Average Coupon 4.000000% Average Life (years) 22.220 Weighted Average Maturity (years) 22.220 Duration of Issue (years) 14.527 Par Amount 20,930,000.00 Bond Proceeds 20,930,000.00 Total Interest 18,602,200.00 Net Interest 18,706,850.00 Bond Years from Dated Date 465,055,000.00 Bond Years from Delivery Date 465,055,000.00 Total Debt Service 39,532,200.00 Maximum Annual Debt Service 1,976,000.00 Average Annual Debt Service 1,317,740.00 Underwriter's Fees (per $1000) Average Takedown Other Fee 5.000000 Total Underwriter's Discount 5.000000 Bid Price 99.500000 Average Par Average Average Maturity PV of 1 bp Bond Component Value Price Coupon Life Date change Term Bond due 2060 20,930,000.00 100.000 4.000% 22.220 02/18/2053 36,418.20 20,930,000.00 22.220 36,418.20 All-In Arbitrage TIC TIC Yield Par Value 20,930,000.00 20,930,000.00 20,930,000.00 + Accrued Interest + Premium (Discount) - Underwriter's Discount -104,650.00 -104,650.00 - Cost of Issuance Expense -200,000.00 - Other Amounts Target Value 20,825,350.00 20,625,350.00 20,930,000.00 Target Date 12/01/2030 12/01/2030 12/01/2030 Yield 4.035168% 4.103068% 4.000000% 8 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) BOND DEBT SERVICE WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Annual Period Debt Debt Ending Principal Coupon Interest Service Service 06/01/2031 418,600 418,600 12/01/2031 418,600 418,600 837,200 06/01/2032 418,600 418,600 12/01/2032 35,000 4.000% 418,600 453,600 872,200 06/01/2033 417,900 417,900 12/01/2033 35,000 4.000% 417,900 452,900 870,800 06/01/2034 417,200 417,200 12/01/2034 90,000 4.000% 417,200 507,200 924,400 06/01/2035 415,400 415,400 12/01/2035 95,000 4.000% 415,400 510,400 925,800 06/01/2036 413,500 413,500 12/01/2036 155,000 4.000% 413,500 568,500 982,000 06/01/2037 410,400 410,400 12/01/2037 160,000 4.000% 410,400 570,400 980,800 06/01/2038 407,200 407,200 12/01/2038 225,000 4.000% 407,200 632,200 1,039,400 06/01/2039 402,700 402,700 12/01/2039 235,000 4.000% 402,700 637,700 1,040,400 06/01/2040 398,000 398,000 12/01/2040 305,000 4.000% 398,000 703,000 1,101,000 06/01/2041 391,900 391,900 12/01/2041 320,000 4.000% 391,900 711,900 1,103,800 06/01/2042 385,500 385,500 12/01/2042 400,000 4.000% 385,500 785,500 1,171,000 06/01/2043 377,500 377,500 12/01/2043 415,000 4.000% 377,500 792,500 1,170,000 06/01/2044 369,200 369,200 12/01/2044 500,000 4.000% 369,200 869,200 1,238,400 06/01/2045 359,200 359,200 12/01/2045 520,000 4.000% 359,200 879,200 1,238,400 06/01/2046 348,800 348,800 12/01/2046 615,000 4.000% 348,800 963,800 1,312,600 06/01/2047 336,500 336,500 12/01/2047 640,000 4.000% 336,500 976,500 1,313,000 06/01/2048 323,700 323,700 12/01/2048 745,000 4.000% 323,700 1,068,700 1,392,400 06/01/2049 308,800 308,800 12/01/2049 775,000 4.000% 308,800 1,083,800 1,392,600 06/01/2050 293,300 293,300 12/01/2050 890,000 4.000% 293,300 1,183,300 1,476,600 06/01/2051 275,500 275,500 12/01/2051 925,000 4.000% 275,500 1,200,500 1,476,000 06/01/2052 257,000 257,000 12/01/2052 1,050,000 4.000% 257,000 1,307,000 1,564,000 06/01/2053 236,000 236,000 12/01/2053 1,095,000 4.000% 236,000 1,331,000 1,567,000 06/01/2054 214,100 214,100 12/01/2054 1,230,000 4.000% 214,100 1,444,100 1,658,200 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) NET DEBT SERVICE WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Period Total Net Ending Principal Interest Debt Service Debt Service 12/01/2031 837,200 837,200 837,200 12/01/2032 35,000 837,200 872,200 872,200 12/01/2033 35,000 835,800 870,800 870,800 12/01/2034 90,000 834,400 924,400 924,400 12/01/2035 95,000 830,800 925,800 925,800 12/01/2036 155,000 827,000 982,000 982,000 12/01/2037 160,000 820,800 980,800 980,800 12/01/2038 225,000 814,400 1,039,400 1,039,400 12/01/2039 235,000 805,400 1,040,400 1,040,400 12/01/2040 305,000 796,000 1,101,000 1,101,000 12/01/2041 320,000 783,800 1,103,800 1,103,800 12/01/2042 400,000 771,000 1,171,000 1,171,000 12/01/2043 415,000 755,000 1,170,000 1,170,000 12/01/2044 500,000 738,400 1,238,400 1,238,400 12/01/2045 520,000 718,400 1,238,400 1,238,400 12/01/2046 615,000 697,600 1,312,600 1,312,600 12/01/2047 640,000 673,000 1,313,000 1,313,000 12/01/2048 745,000 647,400 1,392,400 1,392,400 12/01/2049 775,000 617,600 1,392,600 1,392,600 12/01/2050 890,000 586,600 1,476,600 1,476,600 12/01/2051 925,000 551,000 1,476,000 1,476,000 12/01/2052 1,050,000 514,000 1,564,000 1,564,000 12/01/2053 1,095,000 472,000 1,567,000 1,567,000 12/01/2054 1,230,000 428,200 1,658,200 1,658,200 12/01/2055 1,280,000 379,000 1,659,000 1,659,000 12/01/2056 1,430,000 327,800 1,757,800 1,757,800 12/01/2057 1,490,000 270,600 1,760,600 1,760,600 12/01/2058 1,655,000 211,000 1,866,000 1,866,000 12/01/2059 1,720,000 144,800 1,864,800 1,864,800 12/01/2060 1,900,000 76,000 1,976,000 1,976,000 20,930,000 18,602,200 39,532,200 39,532,200 10 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) SUMMARY OF BONDS REFUNDED WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Maturity Interest Par Call Call Bond Date Rate Amount Date Price 7/30/18: Ser 20 NR SP, 5.00%, 100x, 40mls+fees, FG+6% BiRe: TERM50 12/01/2031 5.000% 135,000.00 12/01/2030 100.000 12/01/2032 5.000% 190,000.00 12/01/2030 100.000 12/01/2033 5.000% 200,000.00 12/01/2030 100.000 12/01/2034 5.000% 260,000.00 12/01/2030 100.000 12/01/2035 5.000% 275,000.00 12/01/2030 100.000 12/01/2036 5.000% 345,000.00 12/01/2030 100.000 12/01/2037 5.000% 360,000.00 12/01/2030 100.000 12/01/2038 5.000% 440,000.00 12/01/2030 100.000 12/01/2039 5.000% 460,000.00 12/01/2030 100.000 12/01/2040 5.000% 545,000.00 12/01/2030 100.000 12/01/2041 5.000% 570,000.00 12/01/2030 100.000 12/01/2042 5.000% 665,000.00 12/01/2030 100.000 12/01/2043 5.000% 700,000.00 12/01/2030 100.000 12/01/2044 5.000% 805,000.00 12/01/2030 100.000 12/01/2045 5.000% 845,000.00 12/01/2030 100.000 12/01/2046 5.000% 960,000.00 12/01/2030 100.000 12/01/2047 5.000% 1,010,000.00 12/01/2030 100.000 12/01/2048 5.000% 1,140,000.00 12/01/2030 100.000 12/01/2049 5.000% 1,195,000.00 12/01/2030 100.000 12/01/2050 5.000% 2,710,000.00 12/01/2030 100.000 13,810,000.00 11 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) ESCROW REQUIREMENTS WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Dated Date 12/01/2030 Delivery Date 12/01/2030 7/30/18: Ser 20 NR SP, 5.00%, 100x, 40mls+fees, FG+6% BiRe Period Principal Ending Interest Redeemed Total 12/01/2030 345,250.00 13,810,000.00 14,155,250.00 345,250.00 13,810,000.00 14,155,250.00 12 Jul 30, 2018 11:50 am Prepared by D.A. Davidson & Co Quantitative Group~CB (Waterfield MD 18:FJUL3018-30IG20NF,30IG20NF) PRIOR BOND DEBT SERVICE WATERFIELD METROPOLITAN DISTRICT GENERAL OBLIGATION REFUNDING BONDS, SERIES 2030 Pay & Cancel Refunding of (proposed) Series 2020 + New Money 40.000 (target) Mills + Fees Assumes Investment Grade, 100x, 30-yr. Maturity (Full Growth + 6% Bi-Reassessment Projections) [ Preliminary -- for discsussion only ] Annual Period Debt Debt Ending Principal Coupon Interest Service Service 12/01/2030 345,250 345,250 06/01/2031 345,250 345,250 12/01/2031 135,000 5.000% 345,250 480,250 1,170,750 06/01/2032 341,875 341,875 12/01/2032 190,000 5.000% 341,875 531,875 873,750 06/01/2033 337,125 337,125 12/01/2033 200,000 5.000% 337,125 537,125 874,250 06/01/2034 332,125 332,125 12/01/2034 260,000 5.000% 332,125 592,125 924,250 06/01/2035 325,625 325,625 12/01/2035 275,000 5.000% 325,625 600,625 926,250 06/01/2036 318,750 318,750 12/01/2036 345,000 5.000% 318,750 663,750 982,500 06/01/2037 310,125 310,125 12/01/2037 360,000 5.000% 310,125 670,125 980,250 06/01/2038 301,125 301,125 12/01/2038 440,000 5.000% 301,125 741,125 1,042,250 06/01/2039 290,125 290,125 12/01/2039 460,000 5.000% 290,125 750,125 1,040,250 06/01/2040 278,625 278,625 12/01/2040 545,000 5.000% 278,625 823,625 1,102,250 06/01/2041 265,000 265,000 12/01/2041 570,000 5.000% 265,000 835,000 1,100,000 06/01/2042 250,750 250,750 12/01/2042 665,000 5.000% 250,750 915,750 1,166,500 06/01/2043 234,125 234,125 12/01/2043 700,000 5.000% 234,125 934,125 1,168,250 06/01/2044 216,625 216,625 12/01/2044 805,000 5.000% 216,625 1,021,625 1,238,250 06/01/2045 196,500 196,500 12/01/2045 845,000 5.000% 196,500 1,041,500 1,238,000 06/01/2046 175,375 175,375 12/01/2046 960,000 5.000% 175,375 1,135,375 1,310,750 06/01/2047 151,375 151,375 12/01/2047 1,010,000 5.000% 151,375 1,161,375 1,312,750 06/01/2048 126,125 126,125 12/01/2048 1,140,000 5.000% 126,125 1,266,125 1,392,250 06/01/2049 97,625 97,625 12/01/2049 1,195,000 5.000% 97,625 1,292,625 1,390,250 06/01/2050 67,750 67,750 12/01/2050 2,710,000 5.000% 67,750 2,777,750 2,845,500 13,810,000 10,269,250 24,079,250 24,079,250 13 EXHIBIT G Public Benefits Category Public Benefit Per Unit Total Water and Energy Conservation 1 All homes DOE Zero Energy Ready & EPA Indoor Air Plus $28,135 $14,039,185 2 LEED Certified $400 $199,600 1 Delivery of 10% Net Zero Energy (50 units) and/or distributed storage $47,540 $2,376,995 3 Delivery of 10% rooftop solar (50 units) and/or distributed storage $8,600 $430,000 Multimodal Transportation Buffered Bike Lane (ROW Land Cost - Suniga) $286 $142,923 Wider than Required Sidewalk (ROW Land Cost - Suniga) $90 $45,134 Enhanced Pedestrian Crossing (2 proposed crossings on Suniga 6 ft wide each) $50 $24,840 Critical Public Infrastructure Major arterial development (ROW Land Cost - Suniga) $490 $244,474 4 Vine and Lemay (200 Units) $800 $160,000 High Quality and Smart Growth Management 5 Alley Construction (all units) $3,324.28 $1,658,818 Smaller lot size (additional utility, water dedication) $8,755 $4,368,740 Increased multifamily development There are 17 DU over the original 200 units in MMN Zone Walkability & Pedestrian Friendliness 5 Trail system enhancements (wetland perimeter trail, paseos) $4,207 $2,099,520 Public Spaces 6 Pocket parks, neighborhood parks, mixed use open space (green courts, community EXHIBIT H Disclosure Notice NOTICE OF INCLUSION IN A RESIDENTIAL METROPOLITAN DISTRICT AND POSSIBLE PROPERTY TAX CONSEQUENCES Legal description of the property and address: (Insert legal description and property address). This property is located in the following metropolitan district: (Insert District Name). In addition to standard property taxes identified on the next page, this property is subject to a metropolitan district mill levy (another property tax) of up to: (Insert mill levy maximum). Based on the property’s inclusion in the metropolitan district, an average home sales price of $300,000 could result in ADDITIONAL annual property taxes up to: (Insert amount). The next page provides examples of estimated total annual property taxes that could be due on this property, first if located outside the metropolitan district and next if located within the metropolitan district. Note: property that is not within a metropolitan district would not pay the ADDITIONAL amount. The metropolitan district board can be reached as follows: (Insert contact information). You may wish to consult with: (1) the Larimer County Assessor’s Office, to determine the specific amount of metropolitan district taxes currently due on this property; and (2) the metropolitan district board, to determine the highest possible amount of metropolitan district property taxes that could be assessed on this property. ESTIMATE OF PROPERTY TAXES Annual Tax Levied on Residential Property With $300,000 Actual Value Without the District Taxing Entity Mill Levies (2017**) Annual tax levied Insert entity Insert amount $ Insert amount Larimer County Insert amount $ Insert amount City of Fort Collins Insert amount $ Insert amount Insert entity Insert amount $ Insert amount Insert entity Insert amount $ Insert amount Insert entity Insert amount $ Insert amount TOTAL: Insert total $ Insert amount Annual Tax Levied on Residential Property With $300,000 Actual Value With the District (Assuming Maximum District Mill Levy) Taxing Entity Mill Levies (2017**) Annual tax levied Insert District Name Insert amount $ Insert amount Insert entity Insert amount $ Insert amount Larimer County Insert amount $ Insert amount City of Fort Collins Insert amount $ Insert amount Insert entity Insert amount $ Insert amount Insert entity Insert amount $ Insert amount Insert entity Insert amount $ Insert amount TOTAL: Insert total $ Insert total **This estimate of mill levies is based upon mill levies certified by the Larimer County Assessor’s Office in December 20__ for collection in 20__, and is intended only to provide approximations of the total overlapping mill levies within the District. The stated mill levies are subject to change and you should contact the Larimer County Assessor’s Office to obtain accurate and current information. FINANCIAL HEALTH OF METROPOLITAN DISTRICT Financial information for (Insert District Name Here) as of (Insert Date of Last Annual Report Here): Notes Amount Total Assessed Value Insert Notes Insert Amount Current Mill Levy & Annual Revenue Insert Mill Insert Amount Current Debt Mill Levy & Annual Revenue Insert Mill Insert Amount Outstanding Debt Insert Term Insert Amount Anticipated Payoff Year Insert Notes Insert Amount Additional information regarding (Insert District Name Here) financial health and formation can be found at the City of Fort Collins website, available at: fcgov.com. In addition, the Colorado Department of Local Affairs may have the following materials available: Audited Financial Statements Annual Budget Annual Report on the Service Plan Certification of Election Results Certification of Tax Levies Notice of Authorization of General Obligation Debt Notice of Issuance of General Obligation Debt Transparency – Notice to Electors Available at: https://dola.colorado.gov/lgis/lgFinances.jsf Or Division of Local Government 1313 Sherman Street, Room 521 Denver, Colorado 80203 (303) 864-7720 Fax: (303) 864-0751 OR Contact the District at: _________Metropolitan District ______ _________[Address]________________ _________[Address]________________ _________[Phone]__________________ _________[Fax]____________________ _________[Email]___________________ plaza, pocket parks) $3,491 $1,742,210 Affordable Housing 7 10% of homes at 80% AMI $7,222 $3,250,000 TOTAL $61,688 $30,782,439 Footnotes: 1 2 3 4 5 6 7 Compared to 2015 code per Rip Reid study Thrive's added cost for LEED Certified 3.5 kW system Difficult to quantify pending APF policy determination. Based on an estimated value for units above what was already approved for APF. As per Exhibit D by Northern Engineering As per Exhibit D by Northern Engineering (Open Space & Signage) $65,000 per unit subsidy distributed over 450 units KƵƌĐŽŵŵŝƚŵĞŶƚŝƐƚŽĚĞůŝǀĞƌϴϬйŽĨD/ŚŽŵĞƐďLJƚŚĞĨŽůůŽǁŝŶŐŵĞĂŶƐ͗;ĂͿĞǀĞůŽƉŝŶŐĂƐƉĞĐŝĨŝĐĐŽŵƉůŝĂŶĐĞƉůĂŶƉƌŝŽƌ ƚŽĞdžĞĐƵƚŝŽŶŽĨĂĞǀĞůŽƉŵĞŶƚŐƌĞĞŵĞŶƚ;ƚŽďĞĂƉƉƌŽǀĞĚďLJŝƚLJŽƵŶĐŝůͿ͘;ďͿŽůůĂďŽƌĂƚŝŶŐǁŝƚŚŽƚŚĞƌDŽƵŶƚĂŝŶsŝƐƚĂ ĚĞǀĞůŽƉĞƌƐ͕ƚŚĞŝƚLJŽĨ&ŽƌƚŽůůŝŶƐ͕,ŽƵƐŝŶŐĂƚĂůLJƐƚ͕ĂŽŵŵƵŶŝƚLJ>ĂŶĚdƌƵƐƚĂŶĚͬŽƌ,ĂďŝƚĂƚĨŽƌ,ƵŵĂŶŝƚLJƚŽĚĞǀĞůŽƉĂ ƌĞƉůŝĐĂďůĞĂŶĚĐŽŶƐŝƐƚĞŶƚĂĨĨŽƌĚĂďůĞŚŽƵƐŝŶŐƉŽůŝĐLJ͘;ĐͿdŚĞƐƉĞĐŝĨŝĐŽƵƚĐŽŵĞŝƐϭϬйŽĨŽƵƌŚŽƵƐŝŶŐƐŽůĚƚŽϰͲƉĞƌƐŽŶ ŚŽƵƐĞŚŽůĚƐĂƚŽƌďĞůŽǁϴϬйD/;ĂƐŝƚŵĂLJĂĚũƵƐƚŝŶƚŚĞĨƵƚƵƌĞͿĨŽƌĂŶĂĨĨŽƌĚĂďŝůŝƚLJƉĞƌŝŽĚŽĨϮϬLJĞĂƌƐ͘;ĚͿdŚĞƐƉĞĐŝĨŝĐ ŵĞĂŶƐŽĨƉƌŽǀŝĚŝŶŐϮϬLJĞĂƌĂĨĨŽƌĚĂďŝůŝƚLJŵĂLJďĞŝŶĨůƵĞŶĐĞĚďLJƚŚĞĐŽůůĂďŽƌĂƚŝŽŶĚĞƐĐƌŝďĞĚŝŶŝƚĞŵďĂďŽǀĞŽƌƚŚĞ ƉƌŽǀŝƐŝŽŶŽĨĂĚĞĞĚƌĞƐƚƌŝĐƚŝŽŶŝĨŶĞĐĞƐƐĂƌLJďĂƐĞĚƵƉŽŶĐŽŶƚƌŝďƵƚŝŽŶƐĨƌŽŵƚŚĞƐƚĂŬĞŚŽůĚĞƌƐƚŚĂƚĂƌĞŶĞĐĞƐƐĂƌLJƚŽ ĂĐŚŝĞǀĞ&ƚ͘ŽůůŝŶƐ͛ĂĨĨŽƌĚĂďůĞŚŽƵƐŝŶŐŐŽĂůƐ͘ Non Basic Costs Environmental Sustainability Outcomes DISCLAIMER: Preliminary estimates designed to provide illustrative representation for value of public benefit. This illustration is non-binding pending execution of a Development Agreement. ϴ ϴ 06/01/2055 189,500 189,500 12/01/2055 1,280,000 4.000% 189,500 1,469,500 1,659,000 06/01/2056 163,900 163,900 12/01/2056 1,430,000 4.000% 163,900 1,593,900 1,757,800 06/01/2057 135,300 135,300 12/01/2057 1,490,000 4.000% 135,300 1,625,300 1,760,600 06/01/2058 105,500 105,500 12/01/2058 1,655,000 4.000% 105,500 1,760,500 1,866,000 06/01/2059 72,400 72,400 12/01/2059 1,720,000 4.000% 72,400 1,792,400 1,864,800 06/01/2060 38,000 38,000 12/01/2060 1,900,000 4.000% 38,000 1,938,000 1,976,000 20,930,000 18,602,200 39,532,200 39,532,200 9 17,235,595 10.000 168,909 10,135 179,043 50.000 18,743,620 10.000 183,687 11,021 194,709 50.000 18,743,620 10.000 183,687 11,021 194,709 50.000 19,868,237 10.000 194,709 11,683 206,391 50.000 19,868,237 10.000 194,709 11,683 206,391 50.000 21,060,331 10.000 206,391 12,383 218,775 50.000 21,060,331 10.000 206,391 12,383 218,775 50.000 22,323,951 10.000 218,775 13,126 231,901 50.000 22,323,951 10.000 218,775 13,126 231,901 50.000 23,663,388 10.000 231,901 13,914 245,815 50.000 23,663,388 10.000 231,901 13,914 245,815 50.000 25,083,192 10.000 245,815 14,749 260,564 50.000 25,083,192 10.000 245,815 14,749 260,564 50.000 26,588,183 10.000 260,564 15,634 276,198 50.000 26,588,183 10.000 260,564 15,634 276,198 50.000 28,183,474 10.000 276,198 16,572 292,770 50.000 28,183,474 10.000 276,198 16,572 292,770 50.000 29,874,482 10.000 292,770 17,566 310,336 50.000 29,874,482 10.000 292,770 17,566 310,336 50.000 31,666,951 10.000 310,336 18,620 328,956 50.000 31,666,951 10.000 310,336 18,620 328,956 50.000 33,566,969 10.000 328,956 19,737 348,694 50.000 33,566,969 10.000 328,956 19,737 348,694 50.000 35,580,987 10.000 348,694 20,922 369,615 50.000 35,580,987 10.000 348,694 20,922 369,615 50.000 37,715,846 10.000 369,615 22,177 391,792 50.000 37,715,846 10.000 369,615 22,177 391,792 50.000 39,978,797 10.000 391,792 23,508 415,300 50.000 39,978,797 10.000 391,792 23,508 415,300 50.000 42,377,524 10.000 415,300 24,918 440,218 50.000 42,377,524 10.000 415,300 24,918 440,218 50.000 44,920,176 10.000 440,218 26,413 466,631 50.000 44,920,176 10.000 440,218 26,413 466,631 50.000 47,615,386 10.000 466,631 27,998 494,629 50.000 _______ ________ _______ 10,672,979 640,379 11,313,358 7/30/2018 F WMD Fin Plan 18 NR LF Fin Plan+2030 Refg SP Prepared by D.A.Davidson & Co. Draft: For discussion purposes only. 3 1,336,750 1,332,750 1,332,750 4,000 0 1,544,000 249% 9% 100% 100% 1,261,136 1,260,250 1,260,250 886 0 1,544,887 151% 8% 100% 100% 795,068 790,000 790,000 5,068 0 1,549,954 112% 7% 101% 101% 844,081 842,000 842,000 2,081 0 1,552,035 101% 6% 100% 100% 896,446 896,250 896,250 196 0 1,552,232 89% 6% 100% 100% 875,940 872,500 872,500 3,440 0 1,555,671 83% 5% 100% 100% 716,173 714,500 714,500 1,673 0 1,557,345 75% 5% 100% 100% 778,835 774,000 774,000 4,835 0 1,562,180 75% 5% 101% 101% 778,835 775,500 775,500 3,335 15 1,565,500 71% 5% 100% 100% 825,565 821,750 $0 821,750 $1,550,000 (1,546,185) 0 19,315 70% 5% 101% 101% 825,565 [ Ref'd by Ser. '30 ] 837,200 837,200 (11,635) 0 7,680 99% 7% 99% 99% 875,099 872,200 872,200 2,899 0 10,579 99% 7% 100% 100% 875,099 870,800 870,800 4,299 0 14,878 94% 6% 101% 101% 927,605 924,400 924,400 3,205 0 18,083 93% 6% 100% 100% 927,605 925,800 925,800 1,805 0 19,887 88% 6% 100% 100% 983,261 982,000 982,000 1,261 0 21,148 87% 6% 100% 100% 983,261 980,800 980,800 2,461 0 23,610 82% 6% 100% 100% 1,042,257 1,039,400 1,039,400 2,857 0 26,466 81% 6% 100% 100% 1,042,257 1,040,400 1,040,400 1,857 0 28,323 76% 5% 100% 100% 1,104,792 1,101,000 1,101,000 3,792 0 32,115 75% 5% 100% 100% 1,104,792 1,103,800 1,103,800 992 0 33,108 70% 5% 100% 100% 1,171,080 1,171,000 1,171,000 80 0 33,187 68% 5% 100% 100% 1,171,080 1,170,000 1,170,000 1,080 0 34,267 63% 4% 100% 100% 1,241,344 1,238,400 1,238,400 2,944 0 37,211 62% 4% 100% 100% 1,241,344 1,238,400 1,238,400 2,944 0 40,156 57% 4% 100% 100% 1,315,825 1,312,600 1,312,600 3,225 0 43,381 55% 4% 100% 100% 1,315,825 1,313,000 1,313,000 2,825 0 46,206 50% 3% 100% 100% 1,394,775 1,392,400 1,392,400 2,375 0 48,581 48% 3% 100% 100% 1,394,775 1,392,600 1,392,600 2,175 0 50,756 43% 3% 100% 100% 1,478,461 1,476,600 1,476,600 1,861 0 52,617 41% 3% 100% 100% 1,478,461 1,476,000 1,476,000 2,461 0 55,078 37% 2% 100% 100% 1,567,169 1,564,000 1,564,000 3,169 0 58,247 34% 2% 100% 100% 1,567,169 1,567,000 1,567,000 169 0 58,416 30% 2% 100% 100% 1,661,199 1,658,200 1,658,200 2,999 0 61,415 27% 2% 100% 100% 1,661,199 1,659,000 1,659,000 2,199 0 63,613 22% 2% 100% 100% 1,760,871 1,757,800 1,757,800 3,071 0 66,684 19% 1% 100% 100% 1,760,871 1,760,600 1,760,600 271 0 66,955 15% 1% 100% 100% 1,866,523 1,866,000 1,866,000 523 0 67,478 12% 1% 100% 100% 1,866,523 1,864,800 1,864,800 1,723 0 69,202 8% 1% 100% 100% 1,978,515 1,976,000 1,976,000 2,515 71,716 0 4% 0% 100% 100% _________ _________ _________ _________ _________ _________ _________ 50,233,431 9,079,500 39,532,200 48,611,700 1,550,000 71,731 71,731 [ FJul3018 20lfspF ] [ FJul3018 30igr20nF] [*] Estimated balance (tbd) 7/30/2018 F WMD Fin Plan 18 NR LF Fin Plan+2030 Refg SP Prepared by D.A.Davidson & Co. Draft: For discussion purposes only. 2 1 18" HDPE STORM DRAIN LINE ST 30" RCP STORM DRAIN LINE ST UD 8" UNDER DRAIN LID AREAS DRAWN BY DATE PROJECT 1496-001 DRAWN BY SCALE EXHIBIT C. Snowdon DATE August 2, 2018 FORT COLLINS: 301 North Howes Street, Suite 100, 80521 GREELEY: 820 8th Street, 80631 970.221.4158 northernengineering.com ( IN FEET ) 1 inch = ft. 400 0 400 Feet 400 SANITARY SEWER & SUBDRAIN MAP 1" = 400' E FIGURE 3 OF 5 LEGEND: SS SEWER LINE - 12 INCH PVC. ALL SEWER TO BE OWNED AND MAINTAINED BY BOXELDER SANITATION DISTRICT SEWER LINE - 8 INCH PVC. ALL SEWER TO BE OWNED AND MAINTAINED BY BOXELDER SANITATION DISTRICT SS SUBDRAIN - 8 INCH HDPE. ALL SUBDRAINS TO BE OWNED AND MAINTAINED BY THE METRO DISTRICT. SD NOTE: LOCAL STREETS AND ASSOCIATED UTILITIES ARE CONCEPTUAL AND MAY CHANGE AS DEVELOPMENT OCCURS. WATER DISTRICT. W NOTE: LOCAL STREETS AND ASSOCIATED UTILITIES ARE CONCEPTUAL AND MAY CHANGE AS DEVELOPMENT OCCURS. Election Sept. 25, 2018 Deadline To Consider Community. Figure 6. NREL’s ESIF will provide a variety of power system and building technology experimental laboratories for validation of the proposed smart community control. Commented [JX26]: Nathan: please make changes as you see fit. Commented [JX27]: John: please make changes as you see fit Commented [JX28]: Kedar: please make changes as you see fit Commented [DF29]: Describe the project team’s existing equipment and facilities that will facilitate the successful completion of the proposed project; include a justification of any new equipment or facilities requested as part of the project Commented [JX30]: Add description of SPL NREL Field Test, Home Energy Management Field Test Lead Lead Tasks 7-8 0.8 Yashen Lin, Ph.D. NREL Control and Optimization Control Lead Support Tasks 3-5 0.5 9 INTEGRATE: Integrated Network Test-bed for Energy Grid Research and Technology.https://www.nrel.gov/esif/assets/pdfs/integrate-overview-3-29.pdf Commented [DF23]: Xin, could talk about the past collaboration between A.O. Smith and NREL. Commented [DF24]: Describe the time commitment of the key team members to support the project Further describe the budget from the cover page if needed For multi-organizational or multi-investigator projects, describe succinctly oThe roles and the work to be performed by each PI and key participant oBusiness agreements between the applicant and each PI and key participant oHow the various efforts will be integrated and managed oProcess for making decisions on scientific/technical direction oPublication arrangements oIntellectual Property issues Communication and engagement plans. Commented [JX25]: Will add later submitter to achieve the project objectives Describe the time commitment of the key team members to support the project Further describe the budget from the cover page if needed For multi-organizational or multi-investigator projects, describe succinctly oThe roles and the work to be performed by each PI and key participant oBusiness agreements between the applicant and each PI and key participant oHow the various efforts will be integrated and managed oProcess for making decisions on scientific/technical direction oPublication arrangements oIntellectual Property issues ... [1] Commented [DF17]: Should be tailored to match the scope of this project. Commented [DF18]: Describe the project team’s unique qualifications and expertise, including those of key subcontractors and partners Describe relevant, previous work efforts, demonstrated innovations, and how these enable the submitter to achieve the project objectives Commented [DF19]: The previous one is too general. I deleted the sentences that are not related with the project. Commented [DF20]: Want to add some descriptions of relevant previous work. Xin, what about the HECO work that you did? Commented [JX21]: Nathan, could you mention specific DOE project that Thrive have worked on in the past? Also please elaborate on the DOE Grand Award for Housing Innovation. Commented [JX22]: John: Please provide several sentences summarizing the background and work of these projects. target audience (e.g., convenings, peer-reviewed publications, patent disclosures, licensed IP, and formation of related CRADAs with industry) Commented [JX12]: Improve. Highlight publications, TRC, webinar, guidelines for future ZNE communities objectives (milestones) should be provided. Note: This section (or any other section) is not for discussing the merits of solar energy in general or the proposed technology in regard to other non-solar technologies. Commented [DF7]: I randomly picked 80% to save some headroom. Not sure whether 100% self-consume is a good idea because it might need a lot of batteries. Please let’s discuss about this. Commented [JX8R7]: This actually could be a research topic – how much battery we will need to achieve 100% PV self consumption written? Innovative – Extent to which the proposed project or solution is well beyond the state of the art. Impactful – Extent to which the proposed project or solution, if successful, impacts the core goals outlined in the Lab Call. Differentiated – Extent of differentiation with respect to existing research efforts, products, solutions, programs, or technologies. Scalable – Likelihood the proposed solution, if successful, could be scaled to have a broader impact after project completion. Commented [DF5]: Depending on the space available, will determine whether to keep or not. Loan Maturity (30 Years) Future Loan Value Home Value 4 Person Household $ 85,100.00 $ 7,091.67 $ 2,694.83 $ 200.00 $287.24 $151.60 $ 2,055.99 $15,958 $382,992 0.417% 360 0 $ 398,950 ($2,055.98) 3-4 Bedroom Unit 120% AMI Yearly Income Monthly Income Income available for housing (38%) HOA ($200/mo) Property Taxes (.072%) Insurance (.038%) Target Monthly Mortgage Payment Down Payment (4% FHA) Loan Amount Interest Rate (5% Annual) Loan Maturity (30 Years) Future Loan Value Home Value 4 Person Household $ 102,120.00 $ 8,510.00 $ 3,233.80 $ 200.00 $349.30 $184.35 $ 2,500.15 $19,406 $465,734 0.417% 360 0 $ 485,140 ($2,500.16) 3-4 Bedroom Unit 80% AMI per City of Fort Collins 38% per City of Fort Collins $200/Mo assumption per City of Fort Collins .072% Property tax assumption per City of Fort Collins .038% Insurance per City of Fort Collins 4% FHA Down Payment per City of Fort Collins Calculated Loan Amount; Home Value minus Down Payment Assumed 5% Interest Rate based on current prevaling rates 9/6/2018 Traditional 30 year fixed mortgage Loan value at loan terminatio n (Payoff) *Calculated affordable home purchase price Income/Monthly Payment Calculation Home Value Calculation Income/Monthly Payment Calculation Home Value Calculation Waterfield - Affordable Housing Income/Monthly Payment Calculation Home Value Calculation ATTACHMENT 7 energy and water efficiency may offset higher property tax costs Mitigations • No proposed mitigations Key Alignment: NLSH 1.1: Improve access to quality housing that is affordable to a board range of income levels; NLSH 1.6, Protect and preserve the quality of life in neighborhoods; ENV 4.1: Achieve Climate Action Plan (CAP) 2020 goals and continue progress toward the 2030 goals; ATTACHMENT 4