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Home My WebLink About20030277.tiff ICENOGLE, NORTON, SMITH, T.Edward Icenogle BLIESZNER & MILLER WELD COUNTY Jennifer L. Gruber Charles E. Norton A Professional Corporation 1;C',' I Kristin A. Decker Erin M. Smith Attorneys at Law 4 Philip G.Volpi Edward J.Blieszner 821 17th Street, Suite 600 2(DJ JAN 27 AN 9: 9 John Goutell Dianne D.Miller - Denver, Colorado 80202-3040 Sara Wagers-Johnson Telephone(303)292-6400 RFC i_ r- Alan D. Pogue Of Counsel Facsimile(303)292-6401 ( i L_ �kJ 1_;D Gordon F.Garrett INSOinspc.com January 22, 2003 Weld County Clerk and Recorder P.O. Box 459 Greeley, CO 80632 RE: Firestone Trails Metropolitan District Pinnacle Farms Metropolitan District Organizational Filings—Pursuant to §32-1-306, C.R.S. Dear Sir or Madam: In accordance with §32-1-306, C.R.S., I have enclosed a copy of the approved service plans for the above mentioned Districts to be retained as a public record for public inspection. If you require any additional information or have any questions please do not hesitate to contact our office. Thank you. Very truly yours, ICENOGLE,NORTON, SMITH, BLIESZNER&MILLER A Professional Corporation C Nicolle Brewer Paralegal :nlb Enclosures M:\Firestone Trails\.Service PlanWinal Service Plan,September 26,2002 NLB1156 0617/0670.0003 2 -0r7 a ` SDONV SERVICE PLAN FOR PINNACLE FARMS - METROPOLITAN DISTRICT -- City of Dacono, Colorado — Approved: September 23, 2002 PINNACLE FARMS METROPOLITAN DISTRICT SERVICE PLAN I. INTRODUCTION The name of the proposed district shall he Pinnacle Farms Metropolitan District (the "District"). The purpose of the District is to finance certain street, traffic safety control, water. _ sanitary sewer, storm drainage and park and recreation public improvements for a development to he known as Pinnacle Farms. The developer of Pinnacle Farms and the petitioner for the formation of the District is Pinnacle Farms. LLC. a Colorado limited liability company (the "Developer"). Jeanie D. McDonald-Carlson. Kent D. Carlson, Lisa Duke Carlson, Lee S. Carlson and Ryan L. Carlson are the owners of all property within the boundaries of the District, and each has consented to the organization nization of the District, as shown in Exhibit NI. attached hereto and incorporated herein. The District is intended to provide for the financing of public improvements for Pinnacle Farms. but is not intended to be a District with perpetual existence. The District will consist of the approximately two hundred twenty (220)-acre Pinnacle Farms project. and no changes in the District's boundaries are authorized, except upon approval by the City of Dacono, Colorado (the "City" or "Dacono") pursuant to Article III herein. The District will he dissolved when its financial obligations are paid or provided for, or when the City requests dissolution, provided then-applicable statutory requirements are met, all as further described in Article VIII of this service plan for the District (the "Service Plan"). Except as provided in this Service Plan, all public improvements and facilities constructed or acquired by the District shall be dedicated and conveyed to the City or its designee and will be operated and maintained by the City or its designee upon acceptance and completion of the District's warranty obligations. Certain sanitary sewer and storm drainage improvements shall. upon the direction and consent of the City, be dedicated and conveyed to the St. "rain Sanitation District or a drainage authority or other governmental entity. Certain water system improvements shall, upon the direction and consent of the City, be dedicated and conveyed to the Central Weld County Water District (the "Water District"). With the prior written approval of the City, specific improvements may be retained by the District and operated and maintained by the District or a successor non-profit owners' association for the use and benefit of residents. taxpayers and property owners. The District shall not provide fire protection or emergency services. which lire protection and emergency services shall be provided by Mountain VieNv Fire Protection District and Tri-.Area Ambulance District or any successor thereof, respectively. The District encompasses portions of the East One-Half of Section 2. Township 1 North. Range 68 West of the 6`h P.M., and is generally located at the intersection of Weld County Road II and Weld County Road 12. The District's boundaries are legally described on Exhibit A. attached hereto and incorporated herein. The Developer and the following participating consultants have prepared this Service Plan: Developer General Counsel Pinnacle Farms, LLC, a Colorado limited Iccnogle, Norton, Smith, liability company Blieszner & Miller, PC Ryan L. Carlson Clay Carlson Dianne D. Miller 12460 I'' Street, PO Box 247 821 17`h' Street, Suite 600 Eastlake. CO 80614 Denver. CO 80202 (303) 457-2966 (303) 292-6400 1hx: (303) 230-7978 lax: (303) 292-6401 email: ddnrn inspc.com Bond Counsel Investment Banker Sherman & Howard. LLC Kirkpatrick Pettis _ Blake Jordan Torn Bishop / Sam Sharp 633 17th Street, Suite 3000 1600 Broadway, Suite 1100 Denver, CO 80202 Denver, CO 80202 (303) 297-2900 (303) 764-6000 tiix: (303) 293-0940 fax: (303) 764-6002 email: hjonlamii sah.com email: tom.bishopr'ii kirkpatrickpettis.com Engineer Accountant \\'BC Engineering Clifton Gunderson, LLC Alan Bronson Bill Petri 224 Potomac Street. Suite I02 6399 South Fiddler's Green Circle :Aurora. CO 301 1 1 Suite 100 (303) 365-9525 Greenwood Village, CO 801 1 1-4974 fax: (30 3) 365-93_'7 (30 3) 779-5710 fax: (303) 779-034S email: billpetri!acliItoncpa.com Market Projections THK Associates, Inc. Patrick Brophy 2953 S. Peoria Street Aurora. CO 80014 (303) 770-7201, Ext. 132 fax: (303) 770-7132 Pursuant to the requirements of the Special District Control Act. § 32-1-201, a seq., C.R.S.. this Service Plan consists of a financial analysis and an engineering plan showing how the proposed facilities and services of the District will be provided and financed. As required by 31-I-2_02(2). C.R.S.. the following items are included in this Service Plan: I. A description of the proposed services; 2. A financing plan showing how the proposed services are to be financed, including all elements required by § 32-1-202(2)(b), C.R.S.; 3. A preliminary engineering survey showing how the proposed services are to he provided; 4. A map of the District boundaries and an estimate of the population and valuation for assessment of the District; 5. A general description of the facilities to be constructed and the standards for construction. including a statement of how the facility and service standards of the District arc compatible with facility and service standards of the County. municipalities and special districts which are interested parties pursuant to 2-1-_204( I). C.R.S.: 6. A general description of the estimated cost of acquiring land, engineering services, legal services, administrative services, initial proposed indebtedness and estimated proposed maximum interest rates and discounts and other major expenses related to the organization and initial operation of the District: and 7. A description of any arrangement or proposed agreement with any political subdivision for the performance of an services between the District and such other political subdivision. and. if applicable. a form of the agreement. II. PURPOSE OF THE DISTRICT The District will finance the construction of public improvements for the Pinnacle Farms development, which improvements shall be dedicated and conveyed to the City or its designee as provided in the Service Plan, or as otherwise required by the City. A certain number of limited improvements, upon the direction and consent of the City, will be dedicated and conveyed to other serving districts, or, upon prior written approval of the City. retained by the District and operated and maintained by the District or a successor non-profit owners' association, for the use and benefit of residents, taxpayers and property owners. Improvements shall he financed through the issuance of indebtedness as set forth in Article V. "Financing Information." Except as specified in or pursuant to this Service Plan, the District will not construct or own any improvements, will not provide for any maintenance, repair or operations of any improvements and will not perform any services, without the consent of Dacono as evidenced by an approved modification to this Service Plan or a resolution of approval of the Dacono City Council. In addition, the District will not contract with any other governmental entity to receive any services 4 which are or may become available from Dacono or to provide any services to or within any other governmental entity. The District shall not provide any services or facilities within any area of the District overlapping with the service area of another district without first obtaining the ritten consent of each and every district whose service area is so overlapped. The District shall dissolve then its financial obligations are paid or provided for, or otherwise upon request of the City. subject to then-applicable statutory requirements, all as further provided in Article VIII hereof. III. BOUNDARIES, POPULATION & VALUATION The District consists of approximately two hundred twenty (220) acres located entirely within the boundaries of Dacono, as more particularly set forth in the legal description in Exhibit A and as shown on the boundaries map, attached hereto and incorporated herein as Exhibit B. The petitioner, also the Developer of the District property, has received the consent of the property owners to the formation of the District, which consent is attached hereto as Exhibit M and incorporated herein by this reference. The District shall be required to obtain written approval from the City of a Service Plan modification prior to any inclusion or exclusion of property to or from the District or any other change in its boundaries, which approval may be given by resolution of the Dacono City Council. Any inclusion may be on the condition that all property originally in the District remain in the District and on such other conditions as Dacono may impose. Any exclusion may be on the condition that there is no detriment to the remaining residents and taxpayers within the District or to the District's bondholders and on such other conditions as Dacono may impose. No changes in the boundaries of the District shall be made, unless the prior written approval of 5 the Dacono Cite Council has been obtained as part of a Service Plan modification. as provided herein. _ The District will be developed for residential use. The property is presently vacant. The current population is zero; the estimated population of the District at full build-out is two thousand two hundred fifteen (2,215) people, subject to development approval by the City. The estimated assessed value at full build-out is approximately Eleven Million Eight Hundred Ninety-one Thousand Five Hundred Fifty-nine Dollars (S11.891,559). The property within the District is zoned R-I. Residential. The current assessed value of the property within the proposed boundaries of the District is approximately Nineteen Thousand Six Hundred Fifty Dollars (SI9.650). The total overlapping mill levy imposed upon the property within the District for tax collection year 2002 is 69.301 mills. IV. DESCRIPTION OF PROPOSED FACILITIES a. Type of Improvements The District will provide for the financing, construction, acquisition and installation of street. traffic safety control, water, sanitary sewer, storm drainage and park and recreation public improvements and facilities (as the foregoing terms are defined in ` 32-1-1004(2), C.R.S.. and the sections referenced therein), within the boundaries of the District and for the operation and _ maintenance for specific improvements as directed or approved by the City. as limited by this Service Plan. The Water District, by contract, provides potable water to the City for delivery to City water users. The Water District owns and maintains treatment, distribution and storage facilities (including pump station(s), elevated tank(s), and master meters and appurtenances) and delivers water to the City water system at certain master meter locations. The property within the District 6 • will receive water service from the City through the City's arrangements with the Water District. The District, together with the Developer. may provide financing for Water District water system improvements and facilities that may he necessary for service to areas within the District, which facilities and improvements are to be designed, constructed. installed or acquired by the Water District. The District \\ill also provide o r the design. construction, acquisition and installation of City water system improvements and facilities located within the boundaries of the District. In addition. a separate raw water irrigation sstem will be installed by the District if it is determined by the Developer and the City to he feasible and if it is approved by the City. The District will provide financing for the City water system improvements, together with the Developer, as more fully set forth below. All Water District system improvements shall be owned by the Water District. All City water systems improvements shall be dedicated and conveyed to. and owned by the City, upon acceptance and completion of the District's warranty obligations. A separate raw water irrigation system, if authorized by the City, shall at the City's option either he dedicated and conveyed to the City or its designee, or owned by the District and maintained by the District or a homed\\Hers' association. All water rights for water service to the property and for any raw water it-rn,_:mon sstem shall he owned by the City. The District will not purchase, own, manage. adjudicate or develop any water rights or water resources. except that, upon the prior written consent of the City, which may be granted or denied in the City's sole discretion, the District may manage, adjudicate or develop those water rights proposed for use in any raw water irrigation system. The Developer at its expense is responsible for achieving any desired fire flows. The District shall not design. construct. acquire or install water improvements or facilities through contracts by the District, including off-site improvements, except upon approval of the City and Water District with respect to the Water District system, and the City. with respect to the City eater system. Any intergovernmental agreement between the District and the Water District shall he submitted to the City for review and shall he approved by the City prior to execution by the District. The District shall not construct any facilities outside the boundaries of the District, except as necessary to connect service for the District to the facilities of other entities involved in providing services to the District as described in this Service Plan, or as approved or directed by Dacono or. with Dacono's consent, as approved or directed by other governmental entities having jurisdiction. However, the District shall not construct any water facilities. except the separate raw water irrigation system and those facilities approved by the City for the City water system. without the prior written consent of the Water District which consent may be withheld for any reason or no reason. Preliminary engineering estimates based on applicable construction standards have been prepared and are attached hereto and incorporated herein as Exhibit C, which lists the facilities that the District, subject to development approval of the City, will provide, including the costs in current dollars of each, together with an explanation of the methods, basis and assumptions used. A letter concerning the reasonableness of the cost estimates and of the methods, bases and assumptions used is included in Exhibit C. The combined total estimated cost of the improvements is Five Million Five Hundred Seventy-two Thousand Six Hundred Fifty-four Dollars (5.5.572,654). The District will seek voter approval for authorization to issue debt sufficient to finance a portion of the cost of the improvements, together with the authorization to provide for refunding of bonds, all as set forth in the Article entitled "Financing Information.'' and the District will he authorized to fund any combination of the improvements shown in Exhibit C. All costs which cannot be paid or reimbursed from bond proceeds will be paid by the Developer; such Developer contribution is presently estimated at Three Hundred Two Thousand 8 Nine Hundred Eleven Dollars (S302,911)(the difference between total estimated costs and bond proceeds available) for capital construction. The City is not responsible for assuming any of the costs of the improvements funded by the District or necessary for service to the Pinnacle Farms development. Maps showing the preliminary location of the public improvements to he financed by the District are attached hereto and incorporated herein as Exhibit D. The District shall be authorized to construct the public improvements _cnerally shown on Exhibit D. subject to development approval by the City and to the specific final desk's] and approval thereof by the City. Phasing of construction shall he in accordance with a phasing plan approved by the City, which plan shall comply with City development standards and be designed to meet the needs of residents and taxpayers within the boundaries of the District. The engineering exhibits provided herein are preliminary. Upon the prior written approval of the City, the District may, without amending this Service Plan, relocate or redesign improvements or facilities to be provided by the District, as necessary to comply with City design requirements and to better accommodate the pace of growth and resource availability within the District. All public improvement locations, designs. plans and specifications are subject to City approval. City consideration of any proposed changes in locations, designs, plans and specifications for public improvements may he undertaken through the development review process for the Pinnacle Farms development. h. Construction Standards All proposed facilities and improvements shall be designed and constructed solely in accordance with the standards and specifications established by Dacono and in effect from time to time and with the applicable standards and specifications of other governmental entities having jurisdiction. All proposed facilities and improvements shall be compatible with those of the City and other governmental entities having jurisdiction. Such other entities include, but are 9 not limited to. the Water District, the St. \'rain Sanitation District, the federal government and the State of Colorado. Where the District is authorized to design certain facilities pursuant to _ this Service Plan. the District and its engineers hate and will design the facilities and improvements to meet such standards, specifications and compatibility requirements of the City and such other governmental entities. Where the District is authorized to construct certain facilities pursuant to this Service Plan, the District will obtain approval of civil engineering plans and permits for construction and installation of facilities or improvements from the City prior to the construction or installation of any facilities or improvements. The District shall be subject to all applicable provisions of the Dacono Municipal Code and to all City rules, regulations and policies with respect to the conduct of its work on the improvements, as in effect from time to time. c. Dedication of Improvements Except as specifically set forth within this Service Plan, the District shall dedicate and convey to Dacono or its designee, or cause to he dedicated and conveyed to Dacono or its designee, all public water and wastewater improvements and facilities, all public streets and street improvements and facilities, all traffic safety controls, all public drainage improvements and facilities and all public sidewalks, as well as all rights-of-way, fee interests and easements necessary for access to and operation and maintenance of such improvements and facilities, to the extent such property interests have not been acquired by the City through the land use approval process. Dacono may also require the dedication and conveyance to the City or its designee of any other facilities and improvements contemplated in this Service Plan, together with necessary rights-of-way. fee interests and easements. All such improvements, facilities. easements and rights-of-way shall he conveyed to Dacono or its designee upon completion of construction, installation and expiration of the two (2)-year warranty period that commences 10 after Dacono has issued Initial Acceptance as set forth below. All improvements, facilities, rights-of-way, fee interests and easements shall be conveyed and dedicated to Dacono or its designee by instruments acceptable to Dacono, free and clear of all liens and encumbrances, except those which are acceptable to Dacono. Failure to comply with the requirements of this Article IV.c shall he deemed to be a material modification of this Service Plan. _ Once a public improvement to be dedicated to the City is constructed and installed. Dacono shall issue an "Initial Acceptance" letter stating that the improvement has been constructed or installed in conformance with Dacono standards, or shall issue a letter stating the corrections necessary for the issuance of such an "Initial Acceptance" letter. The District shall promptly' undertake any necessary conrections. Upon issuance of the "Initial Acceptance" letter, the public improvements shall be warranted for two (2) calendar years from the date of such "Initial Acceptance", during which time the District shall maintain the improvements and correct all deficiencies therein as directed by the City. At the conclusion of such two (2)-year period, Dacono shall issue a "Final Acceptance" letter if the public improvements conform to Dacono specifications and standards or shall issue a letter stating the correction necessary for the issuance of such a "Final Acceptance" letter. The District shall promptly undertake any necessary corrections. A "Final Acceptance" meeting shall then be arranged, at which time Dacono will issue a "Final Acceptance" for all public improvements to be accepted by it. and the District will execute and deliver to Dacono all necessary instruments to dedicate and convey to Dacono the improvements and facilities, all necessary rights-of-way, fee interests and easements. d. Ownership/Maintenance of Public Improvements by District Except for facilities and improvements described in this Article IV.d., the District shall not be authorized to own or operate any improvements or facilities to be provided pursuant to this Service Plan, other than as necessary to permit the financing and construction thereof, except II through approval by Dacono of an amendment to this Service Plan. The District shall have authority to operate and maintain the improvements described in this Article IV.d. Park and recreation improvements, tract landscaping improvements. stony' drainage intpro‘ements and trail systems kill be retained by the District for operations and maintenance, except that upon request of the City, such improvements and facilities shall promptly be dedicated and conveyed to, and thereafter owned, operated and maintained by Dacono or its designee. If retained by the District, the District may contract with a non-profit owners' association for operation and maintenance of these improvements and facilities. Any contract with an owners' association must be approved by Dacono in advance, and Dacono may require assurances that an owners' association accepts the operation and maintenance obligations and has the financial ability to undertake such obligations. Park and recreation improvements and trail systems shall be open to general public use. No user charges may be imposed for use by any member of the public for any trail systems or facilities. e. .acquisition of Land for Public Improvements and Easements The District shall acquire at no cost to Dacono all lands or interests in land required by Dacono for construction of water, wastewater, street and other public improvements being provided by the District. Such land or interests in land may be acquired by the District by instruments of conveyance and/or plat dedication. All such land and interests in land shall be conveyed to Dacono or its designee at no cost to Dacono at such times and by such instruments of conveyance as the City may reasonably require, free and clear of all liens and encumbrances, except those which are acceptable to Dacono. Exceptions must be approved by Dacono in advance and in v.riting. Failure to comply with this provision shall be deemed to be a material modification of this Service Plan. 12 f. Limitation on Eminent Domain The District shall not exercise any power of dominant eminent domain against Dacono and shall not exercise any power of eminent domain within Dacono without the prior written consent of Dacono. No exercise of eminent domain by the District is contemplated or authorized in this Service Plan, and any proposed use thereof shall be considered a material modification of this Service Plan and shall be subject to Dacono's prior approval. g. Services to be Provided by other Governmental Entities The District proposes to construct or acquire the public improvements necessary to serve the District's residents and taxpayers, but is not authorized to and will not provide ongoing water, sanitary sewer, storm drainage or park and recreation services within the District. The City shall provide water services pursuant to arrangements with the Water District. St. Vrain Sanitation District shall provide sanitary sewer services. The serving sanitation district, the City or a drainage authority or other governmental entity or some combination thereof, shall provide storm drainage. The City and the Carbon Valley Recreation District shall provide park and recreation services. The Developer shall include the property within the boundaries of the District into the Water District, the St. Wain Sanitation District and the Carbon Valley Recreation District. The District is within and shall receive tire protection services from Mountain View Fire Protection District and shall receive emergency services from Tri-Area Ambulance District or ally successor thereof. It is a condition of this Service Plan that the property within the District shall be included within the foregoing districts. Nothing herein shall limit or discharge the District's responsibilities for operation, maintenance and repair of public improvements prior to their acceptance by the City or its designee or the District's warranty obligations. 13 h. Integration — All facilities and improvements shall be constructed so as to be integrated with existing and planned facilities and improvements of Dacono and other entities providing service to the Pinnacle Farms development. The District shall obtain from such other serving entities approval of the proposed plans for the facilities and improvements. �'. FINANCING INFORMATION This Article V describes the nature, basis, method of funding and debt and mill levy requirements, restrictions and limitations associated with the District's public improvements program and operations. A detailed Financing Plan, consisting of the Accountant's Forecasted Cash Surplus Balances and Cash Receipts and Disbursements (including a Summary of Significant Forecast Assumptions). the Market Projection Consultant's Analysis and the Developer's Letter in Support of the Market Projections is contained in Exhibit E, attached hereto and incorporated herein. The Financing Plan includes estimated operations, maintenance and administration costs, proposed indebtedness and estimated interest rates and discounts and other major expenses related to the organization and operation of the District. It projects the issuance of the debt and the anticipated repayment based on the development assumptions for property within the boundaries of the District. The Financing Plan demonstrates that, at the projected level of development and with the projected Developer support, the District has the ability to finance the facilities identified herein and will be capable of discharging the proposed indebtedness on a reasonable basis. a. General The provision of improvements and facilities by the District will be financed through the issuance of general obligation bonds ("bonds"). secured by the ad valorem taxing authority of the 14 District and other District revenues. limited as discussed below. The Financing Plan anticipates the issuance of three (3) series of bonds in 2004, 2006 and 2009. which parallel three (3) phases of development. The combined total estimated cost of the improvements is Five Million Five Hundred Seventy-two Thousand Six Hundred Fifty-four Dollars (55.572.654). The District has the capacity to issue general obligation bonds in the aggregate principal amount of Five Million Five Hundred Seventy Thousand Dollars (S5.570,000). Currently. it is anticipated that the bond proceeds will be insufficient to allow for repayment of Three Hundred Two Thousand Nine Hundred Eleven Dollars (5302,911 ) contributed by the Developer; however, if the financing capability of the District changes and tYill permit repayment in the future (due to higher than anticipated assessment values. lover interest rates or any other circumstance). the District may agree to repay the Developer for unreimbursed public infrastructure costs so long as the District has the capacity to make such payments without exceeding the debt limit or Mill Levy Limit provided in this Service Plan. Payments made to the Developer by the District are expected to be made principally from bond proceeds and shall not exceed the amount advanced for capital costs by the Developer. The Developer acknowledges and accepts the risk that, if all or a part of the general obligation bonds proposed to be issued by the District are not issued, because of changes in financial conditions or for any other reason, the Developer may not be paid or reimbursed for the cost of public improvements or other advances to the District. h. Debt Issuance ( I ) Types of Debt Authorized; Debt Limit; Timing and Development Thresholds. This Service Plan authorizes only the issuance of general obligation bonds, except as provided below with respect to notes issued to the Developer for construction financing. All financial obligations of the District are subject to the provisions as to the Limited Mill Levy and other 15 limitations as set forth below. Other than ad valorem property taxes, specific ownership taxes. amounts capitalized from bond proceeds and investment income on the foregoing. no District revenues shall be pledged to any financial obligations of the District. The District may be authorized to issue revenue bonds, certificates, debentures or other evidences of indebtedness or to enter into lease-purchase transactions. only upon approval of an amendment to this Service Plan. and such an amendment shall he considered a material modification of the Service Plan. The Financing Plan assumes the issuance ot. three (3) series of general obligation bonds in the aggregate principal amount of Five Million Five Hundred Seventy Thousand Dollars (55.570,000). A total debt limit of Six Million Dollars (S6,000,000) ill aggregate principal amount is approved in this Service Plan; such debt limit is to apply to the aggregate outstanding amount of both general obligations bonds (including Developer Bonds, as hereinafter defined, and refunding bonds) and construction financing notes (i.e., notes or other financial obligations, if any. issued by the District to the Developer to evidence the District's obligation to repay the Developer's advances for construction costs). The first series of general obligation bonds will be issued in the approximate amount of One Million Nine Hundred Thirty-five Thousand Dollars (S1,935,000), at such time as two hundred fifty-two (252) single family homes (representing a total of approximately $6.36 million in assessed valuation) have received certificates of occupancy and all public improvements serving such homes have been completed and accepted by the City ("Development Threshold I"), all of which is anticipated to occur in December 2004 as shown in Exhibit E. The Developer expects that sales of such first series of general obligation bonds (to financial institutions or institutional investors as further provided below) would be made on the basis that, builder activity having commenced within the District (as demonstrated by the development levels required by the immediately preceding sentence). there is a reasonable likelihood that 16 projected future development will occur and will result in increased assessed valuation levels to support payment of such bonds. The second series of general obligation bonds will be issued in the approximate amount of One Million Nine Hundred Twenty-five Thousand Dollars (S1.925.000), at such time as certificates of occupancy have been issued on a total of six hundred eight (608) single family homes (representing a total of approximately 511.5 million in assessed valuation) and all public improvements serving such homes have been completed and accepted by the City ("Development Threshold II"). all of which is anticipated to occur in December 2006 as shown in Exhibit E. The final series of general obligation bonds will be issued in the approximate amount One Million Seven Hundred Ten Thousand Dollars (S1,710.000). at such time as certificates of occupancy have been issued fir all residential development and all public improvements serving such residential development have been completed and accepted by the City ("Development Threshold III"), all of which is anticipated to occur in December 2009. At full build-out, the Pinnacle Farms development is expected to consist of four hundred fifty-two (452) single family detached homes and two hundred (200) single family attached homes. City approvals are required and have not yet been obtained for the proposed development; it is acknowledged that City development approvals and requirements may affect the numbers of homes anticipated in this Service Plan. (2) Voter Authorization; Interest, Discount, Term, Other Restrictions. The District shall request voter authorization for a maximum of Six Million Dollars (S6,000,000) of general obligation debt (together with construction financing notes) to allow for unforeseen contingencies, increases in construction costs due to inflation and all costs of issuance. including capitalized interest, reserve funds, discounts, legal fees and other incidental costs of issuance. The authorized maximum voted interest rate is eighteen percent (18%) per annum and the maximum underwriting discount is four percent (4%) of bond principal. The actual interest rates 17 • and discounts within such maximum amounts will he determined at the time the bonds are sold by the District and will reflect market conditions at the time of sale. The term of ally bonds issued by the District shall not exceed thirty (30) years. Estimated interest rates used in Exhibit E are based on information furnished by the underwriters identified in Exhibit F. In the event bonds are issued at an interest rate higher than the estimated rates used in Exhibit E. the principal amount of bonds will be reduced so as to result in total debt service payments approximately equal to those projected in Exhibit E. and so that debt service on the bonds can be paid from the revenue sources contemplated in this Service Plan. If actual increases in District assessed valuation attributable to inflation and biennial revaluation factors are less than the projected increases for those factors as shown in the Exhibit E forecasts, it is expected that the District would compensate by increasing its mill levy (subject to the Limited Mill Levy). It is expected that any such increase in the projected mill levy to compensate for decreased inflation and revaluation factors would not exceed approximately fifteen ( 15) additional mills. No bonds issued by the District shall provide for acceleration as a remedy upon default, unless the District has received the prior v.ritten administrative approval of the City, which approval may be granted by only the City .administrator or the City Council. All bonds of the District shall be structured utilizing a commercial bank with trust powers as trustee to hold the bond proceeds and debt service funds and to pursue remedies on behalf of the bondholders. (3) Investor Suitability. In addition: (A) The first District bond issue (after Development Threshold I is reached. anticipated in December 2004, as described above) shall be issued only to financial lS • institutions or institutional investors within the meaning of § 32-I-1101(6)(a)(IV). § 3'_- 1-103(6.5) and § I I-59-103(8), C'.R.S.: and (B) The second District bond issue (after Development Threshold II is reached) and the third District bond issue (after Development Threshold III is reached), anticipated in December 2006 and December 2009, respectively, as described above. shall either: (i) he issued only in denominations of not less than rive hundred thousand dollars (S500,000) each, in integral multiples of not less than one thousand dollars (SI,000). all as provided in Regulation 59-10.3 promulgated under the Colorado Municipal Bond Supervision Act, 11-59-101 et seq., C.R.S., so long as such regulation is in effect and otherwise in full compliance with such regulation and such Act; or (ii) be issued only in denominations of one hundred thousand dollars (S100,000) or more, be sold not in a public offering and exclusively to accredited investors, as that term is defined under sections 3(b) and (4X2) of the federal "Securities Act of 1933" by regulation adopted thereunder by the Securities and Exchange Commission, and contain, written conspicuously on such bond, restrictions on transfer as necessary to insure that secondary sales are similarly limited to accredited investors. The District shall provide for and shall utilize mechanisms and procedures for transfers and exchanges of bonds which are reasonably designed to insure continuing compliance with _ applicable institutional investor, accredited investor and minimum denomination requirements. If the District's bonds are rated in one of the four highest investment grade rating categories by one or more nationally recognized organizations which regularly rate such obligations, 19 compliance with the minimum denomination, institutional investor and accredited investor limitations set forth above shall not be required. (4) Limited Mill Levy. "Limited Till Levy" shall mean an ad valorem mill levy (a mill being equal to I:IU of I c) imposed upon all taxable property in the District each year in an amount sufficient to pay the principal of. premium if any, and interest on the bonds as the same become due and payable. and to make up any deficiencies in any debt service reserve for the bonds. but. together with all other District mill levies tincludm2. without limitation, all mill levies for administration, maintenance and other operating expenses). such mill levy shall not exceed fifty (50) mills; provided however, that in the event of changes in the ratio of actual valuation to assessed valuation for residential real property, pursuant to Article X, section 3(1)(b) of the Colorado Constitution and legislation implementing such constitutional provision, the fifty (50) mill levy limitation provided herein will be increased or decreased (as to all taxable property in the District, including both residential and commercial property, if any) to reflect such changes so that, to the extent possible, the actual tax revenues generated by the mill levy, as adjusted, are neither diminished nor enhanced as a result of such changes ("Gallagher adjustment"). The Limited Mill Le%v shall he an enforceable limit on all District mill levies. (5) Opinions. Any bonds issued by the District pursuant to this Service Plan shall be in compliance with all applicable legal requirements. including without limitation 32-I-1101(6). C.R.S., and article 59 of title I I, C.R.S., and shall be approved by nationally recognized bond counsel. An opinion shall also be obtained from bond counsel or counsel to the District that the bonds comply with all requirements of this Service Plan. (6) Refunding bonds. General obligation refunding bonds may be issued by the District to defease original issue bonds in compliance with applicable law, but any such refunding shall not extend the maturity of the bonds being refunded nor increase the total debt service thereon. ?0 Any issuance of refunding bonds must comply with paragraph (A) under (3) above ("Investor Suitability"). unless Development Threshold II has been reached, in which case such issuance of refunding bonds must comply with either paragraph (A) or paragraph (B) under (3) above (or unless the rebinding bonds have received an investment grade rating as described in the last sentence of (3) above). Except as otherwise specifically provided in this paragraph (6). all limitations, restrictions and requirements of this Service Plan with respect to general obligation bonds of the District shall be applicable to refunding bonds, including, without limitation, Limited Mill Levy, debt limit, maximum interest rate, maximum discount, maximum term. prohibition on acceleration, bank trustee requirement and opinion requirements. (7) Developer Bonds. In lieu of issuing bonds to third party investors, the Developer may choose to purchase all bonds of a series. In that instance, bonds may issue to the Developer ("Developer Bonds") at any time without regard to the Development Thresholds described in (I ) above: however, the Development Thresholds described in ( I ) above shall be achieved before Developer Bonds in an amount equal to all or any portion of the amount shown for each Development Threshold may be resold by the Developer, and except to the extent that the applicable Development Threshold is achieved, Developer Bonds shall not be transferred, assigned, participated or used as security for any borrowing. If and when Developer Bonds are resold by the Developer, such resale must comply with paragraph (A) under (3) above, unless Development Threshold II has been reached, in which case such resale must comply with either paragraph (A) or paragraph (B) under (3) above (or unless the Developer Bonds have received an investment grade rating as described in the last sentence of (3) above). The purchase of Developer Bonds by the Developer shall he not be subject to any underwriting discount, and interest rates on Developer Bonds shall not exceed the estimated interest rates used in Exhibit E. Except as otherwise specifically provided in this paragraph (7), all limitations, restrictions and ?l • requirements of this Service Plan with respect to general obligation bonds of the District shall be applicable to Developer Bonds, both when owned by the Developer and upon any permitted resale, including, without limitation, Limited Mill Levy, debt limit, maximum interest rate, maximum discount. maximum term, prohibition on acceleration, bank trustee requirement and opinion requirements. For purposes of ownership of Developer Bonds, the Developer shall include all affiliates or entities under the majority control of the Developer, provided that any such affiliate or entity must he an accredited investor, as that term is defined under sections 3(b) and (4) 2) of the federal "Securities Act of I 93'' by regulation adopted thereunder by the Securities and Exchange Commission at the time of acquisition of the Developer Bonds. The Developer (including all such affiliates and entities) assumes all risk of nonpayment or other default on Developer Bonds, and shall comply with the above-stated limitations, restrictions and requirements regarding Developer Bonds. (8) Construction Financing Notes Issued to the Developer. The District may issue construction financing notes to the Developer to evidence the District's obligation to reimburse the Developer's advances for construction costs; any Developer advances which are not so reimbursed shall be treated as Developer contributions as described in Article V.a above. Such notes shall be subject to the following restrictions set forth above for general obligation bonds: Limited Mill Levy, debt limit, maximum term. prohibition on acceleration and opinion as to Service Plan compliance; but such notes shall not be subject to the above-stated bank trustee requirement, Development Threshold, investor suitability or bond counsel opinion requirements. Such notes shall not be general obligations of the District, shall bear no interest (see Note 7 in Exhibit E), shall he issued only to the Developer (and therefore shall be not be subject to any underwriting discount), and shall not be transferred, assigned, participated or used as security for any borrowing. The Developer hereby represents that it is, and will be when any such notes are 17 issued. an accredited investor, as that terns is defined under sections 3(b) and (4)(2) of the federal "Securities Act of 1933- by regulation adopted thereunder by the Securities and Exchange Commission. Such notes shall be paid from proceeds of the District's general obligation bonds (when and if received by the District): otherise. the notes \\ill he unsecured obligations of the District. To the extent that any of such notes arc outstanding when the District's general obligation bonds are also outstanding, payments on the notes may be made only if such payments do not adversely' affect the District's ability to pay its general obligation bonds. The Developer solely assumes the risk of nonpayment or other default on such notes, including, without limitation. delay, inability or failure of the District to sell or issue its general obligation bonds. c. Identification of District Revenue The District will impose a mill levy on all taxable property in the District as the primary source of revenue for repayment of debt service and for operations and maintenance. The mill levy imposed by the District shall not exceed fifty (50) mills. except for Gallagher adjustments permitted under Article \'.b above. Although the mill levy imposed may vary depending on the phasing of facilities anticipated to be funded, it is estimated that a mill levy of approximately thirty-five (35) mills will produce revenue sufficient to support debt service, operations and maintenance expenses throughout the repayment period. The District does not intend and is not authorized to impose any system development fees or any other fees or user charges for use of public improvements described in Article IV. The imposition of any such proposed fee or charge shall be considered a material modification of this Service Plan, which shall require the City's prior written consent. d. Security for Debt The District will not pledge any City thuds or assets for security for the indebtedness set forth in the Financing Plan of the District. 23 e. Services of District The District will require sufficient operating funds to plan and cause the public improvements to be constructed. The District will also require sufficient operating funds for the maintenance of any improvements it is required or authorized to maintain as provided in this Service Plan. The costs are expected to include: maintenance, organizational costs. legal. _ engineering, accounting and debt issuance costs, compliance with state reporting and other administrative requirements. The first year's operating budget (for 2002) is estimated to be Seventy Thousand Dollars (570.000). The District currently anticipates that, upon approval by the City. a non-profit owners' association will maintain some or all of the improvements that the District may retain pursuant to Article IV.d. above, which may further reduce or eliminate the District's operations and maintenance obligations. Such improvements will be retained by the District for operations and maintenance, unless Dacono requests that such improvements be dedicated and conveyed to Dacono or its designee. G Quinquennial Review Pursuant to § 32-1-1101.5, C.R.S., the District shall submit application for a quinquennial finding of reasonable diligence in every fifth calendar year after the calendar year in which the District's ballot issue to incur general obligation indebtedness was approved by its electorate. Upon such application, the City Council may accept such application or hold a public hearing thereon and take such actions as are permitted be law. The District shall be responsible for payment of Dacono consultant and administrative costs associated with such review, and Dacono may require a deposit of the estimated costs thereof. Dacono shall have all powers concerning the quinquennial review as provided by statutes in effect from time to time. za g. Letters There is attached hereto as Exhibit F an underwriter's letter stating its intention to underwrite the District's financial obligations as proposed in this Financing Plan. There is attached hereto as Exhibit G a letter from Counsel for the District stating that the petition for organization of the District, this Service Plan. notice and hearing procedures in connection therewah and provisions thereof (including without limitation provisions as to the District's bonds and revenue sources) meet the requirements of titles I1 and 32, C.R.S., and other applicable law. VI. LANDOWNERS OBLIGATIONS AS TO PUBLIC IMPROVEMENTS The creation of the District shall not relieve the Developer, the landowner or any subdivider of property within the District or any of their respective successors or assigns, of obligations to construct public improvements for the Pinnacle Farms development or of obligations to provide to the City letters of credit, bonds or such other financial guarantees as may he required by the City to ensure the completion of such public improvements, or of any other obligations to Dacono under City ordinances, rules, regulations or policies, or under the annexation agreement, subdivision improvement agreement or other agreements affecting the property within the District or the Pinnacle Farms development, or any other agreement between Dacono and the Developer(or any such landowner, subdivider or successors or assigns). VII. ANNUAL REPORT The District shall be responsible for submitting an annual report to Dacono within one hundred and twenty ( 120) days from the conclusion of the District's fiscal year. Failure of the District to submit such report shall not constitute a material modification hereof, unless the • 25 District refuses to submit such report within thirty 130) days after a written request from Dacono to do so. The District's fiscal year shall end on December 31' of each year. The content of the annual report shall include information as to the following matters which occurred during the year: I. Boundary changes made or proposed; 2. Intergovernmental agreements entered into or proposed; 3. Changes or proposed changes in the District's policies; 4. Changes or proposed changes in the District's operations; ?. Any changes in the financial status of the District including any issuance of financial obligations or any change in revenue projections or operating costs; 6. A summary of any litigation and notices of claim involving the District; 7. Proposed plans for the year immediately following the year summarized in the annual report; 8. Status of construction of public improvements; 9. The current assessed valuation in the District; and 10. A schedule of all fees, charges and assessments imposed in the report year and proposed to be imposed in the following year and the revenues raised or proposed to be raised therefrom. The foregoing list shall not be construed to excuse the requirement for prior written City approval of those matters that are considered material modifications of this Service Plan or for any other required City approval. The annual report shall be signed by the President and attested by the Secretary of the District. Along with the annual report and at any more frequent intervals as reasonably requested by Dacono, the District shall provide to Dacono a currently dated and written certificate, signed by the President and Secretary of the District, certifying that the 26 District is in full compliance with this Service Plan. If the District is not in full compliance with this Service Plan, the certificate shall include a detailed statement describing such noncompliance, and the District shall cooperate fully with the Dacono in providing further information as to. and promptly remedying. any such noncompliance. The City reserves the right. pursuant to § 32-I-207(=)(c). C.R.S.. to request reports from the District beyond the mandatory statutory live (5)-year reporting report. In addition to the foregoing, the District shall cooperate with the City by providing prompt responses to all reasonable requests by the City for information, and the District shall permit the City to inspect all public improvements and facilities and all books and records of the District. VIII. DISSOLUTION Promptly when all of thegeneral obligation bonds to be issued by the District have been paid (or when provision for payment thereof has been made through establishment of an escrow as provided by § 32-I-702(3)(I ). C.R.S.). the District will so notify the City and will cooperate fully with the City in taking all steps necessary under then applicable law to dissolve the District (including, without limitation: formulating a plan of dissolution; executing the District's consent to dissolve pursuant to § 32-I-704(3)(6). C.R.S.; making any necessary agreements as to continuation or transfer of maintenance and other services, if any, which are then being provided by the District; submitting a petition for dissolution to the district court; and, conducting any required dissolution election). In addition, at any time after issuance of the District's general obligation bonds, upon the City's request, the District will cooperate fully with the City to dissolve the District (without such payment of outstanding general obligation bonds of the District or establishment of an escrow therefor) as provided in i§ 32-I-702(3)(c) and 32-I-707(2)(c), C.R.S. To the extent that 27 any District financial obligations are owned by the Developer (or by affiliates or entities controlled by the Developer as provided in Article V.b(7)), the Developer shall cooperate fully. and shall cause any such affiliate or entity to cooperate fully, with the City to dissolve the District. Also, on or after December 31, 2007, if the District has not issued any of its general obligation bonds, the City shall have the right to require the District to dissolve in accordance _ with applicable law, and the District will cooperate fully with the City to dissolve the District. To the maximum extent permitted by law, the above-stated agreements to cooperate in dissolution of the District shall be binding on the undersigned Developer (including, the Developer's entities and affiliates) and on the landowners signing the Consents contained in Exhibit NI to this Service Plan (together constituting the owners of 100% of the land in the District) and shall also be binding on successors in title to any and all land in the District (including, without limitation, the nominees for the initial board of directors listed in Article N hereof and succeeding directors who own land within the District). Such agreements shall obligate all such persons to cooperate fully with the City as described above, including without limitation, the signing of petitions, execution of consents and voting in favor of dissolution in any required election. IX. CONSOLIDATION The District shall not file a request with the district court to consolidate with another district without the prior written approval of Dacono. X. ELECTIONS Following approval of this Service Plan by the City and after acceptance of the organizational petition and issuance of orders from the district court, elections on the questions 2g of organizing the District and approving bonded indebtedness and various agreements described herein will be scheduled. All elections will be conducted as provided in the court orders, the Uniform Election Code of 1992 (as amended by House Bill 93-1255 and as otherwise amended from time to time), and the TABOR Amendment and are currently planned for November 2002, but may he held on any legally permitted date. The election questions are expected to include whether to organize the District, election of initial directors and TABOR Amendment ballot issues and questions. Thus, the ballot may deal kith the following topics (in several questions. but not necessarily using the exact divisions shown here): I. Whether to organize the District, 2. Membership and terms of the initial board members, . Approval of new taxes, 4. Approval of maximum operational mill levies, 5. Approval of bond and other indebtedness limits, 6. Approval of an initial property tax revenue limit, 7. Approval of an initial total revenue limit, 8. Approval of an initial fiscal year spending limit, and 9. Approval of a four (4)-year delay in voting on ballot issues. Ballot issues may be consolidated as approved in court orders. The petitioners intend to follow both the letter and the spirit of the Special District Act, the Uniform Election Code and the TABOR Amendment during organization of the District. Future elections to comply with the TABOR Amendment may be held as detemlined by the elected Board of Directors of the District. The following persons, who are or will be owners of property within the District, are intended as nominees for the initial board of directors of the District: 29 • Scott Lee Carlson r. Kent D. Carlson Clay Carlson Lee S. Carlson Ryan L. Carlson XI. INDEMNITIES The full executed Developer Indemnity Letter attached hereto as Part I of Exhibit H is submitted by the Developer to the City as part of this Service Plan. The fomi of the District Indemnity Letter attached hereto as Part 2 of Exhibit H shall be executed by the District and delivered to Dacono immediately upon formation of the District. The execution of such Indemnity Letters are material considerations in Dacono's approval of this Service Plan. and the City has relied thereon in approving this Plan. XII. DISCLOSURE AND DISCLAIMER; NO THIRD-PARTY RIGHTS The District will also record a statement against the property within the District which will include notice of the existence of the District, anticipated mill levy and maximum allowed mill levy. The form of the notice is attached hereto and incorporated herein as Exhibit I, subject to ally changes requested by the City in the future. In addition, there is attached hereto as Exhibit J a form of City disclaimer statement. The District shall conspicuously include this disclaimer statement or any modified or substitute statement hereafter furnished by Dacono, in all offering materials used in connection with any bonds or other financial obligations of the District (or. if no offering materials are used, the District shall deliver the disclaimer statement to any prospective purchaser of such bonds or financial obligations). No changes shall be made to 30 the disclosure and the disclaimer set forth in, respectively, Exhibits I and J. except as directed by Dacono. Neither this Service Plan, the intergovernmental agreement set forth in Exhibit K hereto, nor any other related agreements, shall be construed to impose upon the City any duties to. nor confer any rights against the City. any purchasers. lenders, investors, bondholders or other third parties. XIII. INTERGOVERNMENTAL AGREEMENTS The District shall enter into an intergovernmental agreement with the City which shall he in substantially the form set forth in Exhibit K. The District shall execute and deliver the intergovernmental agreement to the City immediately upon formation of the District. The execution of such Agreement is a material consideration in Dacono's approval of this Service Plan, and the City has relied thereon in approving this Plan. No other intergovernmental agreements are proposed at this time, but such agreements are anticipated between the District and the Water District, the Carbon Valley Recreation District and potentially other entities providing service to the Pinnacle Farms project. Any intergovernmental agreements proposed regarding the subject matter of this Service Plan shall be subject to review and approval by the City prior to their execution by the District. Failure of the District to obtain such approval shall constitute a material modification of this Service Plan. XIV. CONSERVATION TRUST FUND The District shall not apply for or claim any entitlement to funds from the Conservation Trust Fund which is derived from lottery proceeds or other funds available from or through governmental or nonprofit entities for which Dacono is eligible to apply. The District shall remit to Dacono any and all conservation trust funds which they receive. 3I XV. MODIFICATION OF SERVICE PLAN The District shall obtain the prior written approval of Dacono before making any material modifications to this Service Plan. Material modifications require a Service Plan amendment and include modifications of a basic or essential nature, including, but not limited to, the lollowing: I. Any change in the stated purposes of the District or additions to the types of facilities. improvements or programs provided by the District; 2. Ally issuance by the District of financial obligations not expressly authorized by this Service Plan or under circumstances inconsistent with the District's financial ability to discharge such obligations as shown in the build-out, assessed valuation and other forecasts contained in Exhibit E. or any change in debt limit, change in revenue type or change in maximum mill levy (except for any necessary Gallagher adjustment as provided in V.b(4), above); 3. Any change in the types of improvements or estimated costs of improvements from what is stated in Exhibit C of this Service Plan; 4. Failure to comply with the requirements of this Service Plan concerning the dedication of improvements or the acquisition and conveyance of lands or interests in land; 5. The failure of the District to develop any capital facility proposed in its Service Plan when necessary to service approved development within the District; 6. Any proposed use of the powers set forth in § 32-I-1101(1)(f) and —1101(1.5), C.R.S.. respecting division of the District; 7. The occurrence of any event or condition which is defined under the Service Plan or intergovernmental agreement as necessitating a service plan amendment; 32 8. The default by the District under any intergovernmental agreement with the City, the Water District or the serving sanitation district; 9. Any of the events or conditions enumerated in § 32-1-207(2), C.R.S., of the Special District Act; 10. Failure by the District to enter into the Intergovernmental Agreement immediately upon its formation as provided in Article XIII hereof, or failure by the District to execute and deliver the District Indemnity Letter immediately upon its formation as provided in Article XI hereof. I I . Any action or proposed action by the District which would interfere with or delay the planned dissolution of the District as provided in Article VIII hereof. (The examples above are only examples and are not an exclusive list of all actions which may be identified as a material modification.) The District will pay all reasonable expenses of the City, its attorneys and consultants, as well as the City's reasonable processing fees, in connection with any request by the District for modification of this Service Plan or administrative approval by the City of any request hereunder. Dacono may require a deposit of such estimated costs. XVI. FAILURE TO COMPLY WITH SERVICE PLAN In the event it is determined that the District has undertaken any act or omission which violates the Service Plan or constitutes a material departure from the Service Plan (including any material modification of the Service Plan without City approval as provided in Article XV hereof), Dacono may utilize the remedies set forth in the statutes to seek to enjoin the actions of the District, or may withhold issuance of any permit, authorization, acceptance or other administrative approval for the Pinnacle Farms development, or may pursue any other remedy 33 available at law or in equity. The District shall pay any and all costs, including attorney's fees, incurred by the City in enforcing any provision of the Service Plan. To the extent permitted by law, the District hereby waives the provisions of§ 2-I-207(;)(b), C.R.S.. and agrees it will not rely on such provisions as a bar to the enforcement by the City of any provisions of this Service Plan. XVII. RESOLUTION OF APPROVAL The Developer and other proponents of the District agree to and shall incorporate the Dacono City Council's Resolution of Approval. including any conditions on such approval, into the Service Plan presented to the appropriate district court. Such resolution shall be attached as Exhibit L. XVIII.SEVERABILITY If any portion of this Service Plan is held invalid or unenforceable for any reason by a court of competent jurisdiction, such portion shall be deemed severable and its invalidity or its unenforceability shall not cause the entire Service Plan to be terminated. Further, with respect to any portion so held invalid or unenforceable, the District and City agree to pursue a Service Plan amendment or take such other actions as may be necessary to achieve to the greatest degree possible the intent of the affected portion. 34 XIX. CERTIFICATION This Service Plan is submitted to Dacono by the undersigned Developer, which is the District petitioner, and with the consent of all owners of all property within the boundaries of the proposed District. The undersigned has caused written notice of Dacono's hearing on the proposed Service Plan to be duly given, on or prior to the hearing date of September 23, 2002, to all "interested parties" within the meaning of § 32-1-204, C.RS., and has caused all other required filings to be made and all other applicable procedural requirements to be met. The information contained in this Service Plan is true and correct as of this date. Pinnacle F LLC, a lorado limited liability company By: Its: Date: a-, DO#1 TABLE OF EXHIBITS EXHIBIT A District Boundaries — Legal Description EXHIBIT B District Map EXHIBIT C Engineering Estimates and Statement of Reasonableness EXHIBIT D • Drawings of the Location of Public Improvements • EXHIBIT E _ Financing Plan Forecasted Cash Surplus Balances and Cash Receipts and Disbursements Market Projection Consultant's Analysis Market Projection Consultant's Letter of Reasonableness Developer's Letter in Support of Market Projections EXHIBIT F Underwriter's Letter EXHIBIT G Legal Counsel Letter EXHIBIT H Part I—Developer Indemnity Letter Part 2—Form of District Indemnity Letter EXHIBIT I Fomi of Disclosure Notice EXHIBIT J Form of City Disclaimer Statement EXHIBIT K Form of Intergovernmental Agreement Between District and City EXHIBIT L Resolution of the City of Dacono Approving the Service Plan EXHIBIT NI Property Owners' Consent EXHIBIT A District Boundaries — Legal Description SERVICE DISTRICT BOUNDARY BEING A PART OF THE EAST ONE-HALF OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN, TOWN OF DACONO, COUNTY OF WELD, STATE OF COLORADO, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BASIS OF BEARINGS: THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN CONSIDERED TO BEAR S00°11'04"E WITH ALL BEARINGS HEREIN RELATIVE THERETO. COMMENCING AT THE EAST ONE-QUARTER CORNER OF SAID SECTION 2, THENCE S89°43'30"W, A DISTANCE OF 30.01 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 11 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO, SAID POINT BEING THE POINT OF BEGINNING; THENCE S00°11'04"E ALONG A LINE PARALLEL WITH AND 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,619.96 FEET TO A POINT ON THE NORTHERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 12 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD - COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE S89°34'18"W ALONG A LINE PARALLEL WITH AND 30.00 FEET NORTHERLY OF THE SOUTH LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,604.89 FEET TO A POINT ON THE WEST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2; THENCE N00°06'16"E ALONG THE WEST LINE OF THE SOUTHEAST ONE- - QUARTER OF SAID SECTION 2, A DISTANCE OF 2,627.31 FEET TO THE CENTER ONE-QUARTER CORNER OF SAID SECTION 2; THENCE N00°06'11"E ALONG THE WEST LINE OF THE NORTHEAST ONE- QUARTER OF SAID SECTION 2, A DISTANCE OF 50.85 FEET; THENCE ALONG THE FOLLOWING TWENTY-ONE (21) COURSES: 1. S89°53'49"E, A DISTANCE OF 130.11 FEET TO AN ARC OF A CURVE; \\Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010\Legals\Service district bndy.doc Page 1 of 4 2. ALONG AN ARC OF A CURVE TO THE RIGHT, THE CENTER BEARS S74°18'38"E, HAVING A DELTA OF 17°13'32", A RADIUS OF 275.00 FEET AND ARC LENGTH OF 82.68 FEET TO A POINT OF TANGENCY; 3. N32°54'54"E, A DISTANCE OF 132.66 FEET; 4. S57°05'06"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; 5. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS S57°05'06"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 6. S57°05'06"E, A DISTANCE OF 26.34 FEET TO A POINT OF CURVATURE; 7. ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 32°58'46", A RADIUS OF 325.00 FEET AND ARC LENGTH OF 187.07 FEET TO A POINT OF TANGENCY; 8. N89°56'08"E, A DISTANCE OF 535.49 FEET TO A POINT OF CURVATURE; 9. ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 10. N00°03'52"W, A DISTANCE OF 10.00 FEET; 11. N89°56'08"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; 12. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS N89°56'08"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 13. N89°56'08E, A DISTANCE OF 294.78 FEET; 14. N00°16'04"W, A DISTANCE OF 115.15 FEET; 15. N33°55'09"E, A DISTANCE OF 154.12 FEET; 16. N00°03'52"W, A DISTANCE OF 1,525.03 FEET; 17. N30°43'25"E, A DISTANCE OF 80.00 FEET; \\Compaq 5wv294\c\SDSK\PROPCurrent Projects\ar0010\Legals\Service district bndy.doc Page 2 of 4 18. S59°16'35"E, A DISTANCE OF 129.36 FEET; 19. N30°43'25"E, A DISTANCE OF 60.78 FEET; 20. N64°59'29"E, A DISTANCE OF 118.22 FEET; 21.N30°03'07"E, A DISTANCE OF 685.68 FEET TO A POINT ON THE SOUTHERLY RIGHT-OF-WAY OF COLORADO STATE HIGHWAY NO. 52 AS RECORDED IN BOOK 1552, PAGE 142 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE ALONG SAID SOUTHERLY RIGHT-OF-WAY LINE OF COLORADO STATE HIGHWAY NO. 52 THE FOLLOWING TWO (2) COURSES: 1. N89°49'47"E, A DISTANCE OF 371.63 FEET; 2. S44°59'13"E, A DISTANCE OF 136.30 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 11; THENCE S00°03'52"E ALONG A LINE PARALLEL WITH AND 30.00 FEET WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,485.84 FEET TO THE POINT OF BEGINNING. CONTAINING 9,563,870 SQUARE FEET OR 219.556 ACRES MORE OR LESS. LEGAL DESCRIPTION STATEMENT I, RONALD LEE POWERS, A PROFESSIONAL LAND SURVEYOR IN THE STATE OF COLORADO, DO HEREBY STATE THAT THE ABOVE LEGAL DESCRIPTION AND ATTACHED EXHIBIT WAS PREPARED UNDER MY RESPONSIBLE CHARGE, AND ON THE BASIS OF MY KNOWI,pa INFORMATION AND BELIEF IS CORRECT. �`° L �" •., 419 ite tP RONALD LEE POWERS, PROFESSIONAL LAND SURV COLORADO NO. 16427111,10).:•ey��e at el LAND SURVEYING, LLC. 224 POTOMAC STREET, SUITE 102 *'•••.*F��l�e n*a*•N AURORA, COLORADO 80011 \\Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010\Legals\Service district bndy.doc Page 3 of 4 EXHIBIT B District Map -1,r "Fl. ��COL -___-i_ T 4971 AI-. " , _-I--t,_ g2 1 1. T__ --• ' r -CQacon'o-- i • + f \ .i.._ .I ! f': I x—r - . ! ' ii • or . Mine Dump: O r- '-, �IIi�O i J - F► �. III , IIIII ! �W/ � F f - !LEF % 1j i•. 5. 14 i t I . E B 1/4 , • II a ; n � r 547 / i + K, luifuuur i m — I •„ WE�.b CO.. R�1 12• 6a.� ■ ; 1//� i it r' +f 1 ~1`,' t LiI +Kr i /- _ tn. a \i. r'~•i y�i r + f 1 . r . ., — _ N - W E Service District Boundary SCALE: 1"=1,000' S EXHIBIT C Engineering Estimates and Statement of Reasonableness Pinnacle Farms Metropolitan Improvement District Engineer's Estimate of Probable Improvement Costs ^ ROADWAY IMPROVEMENTS Description Qty. Unit Unit Price Total Cost COLORADO STATE HIGHWAY 52 Roadway Improvements — Aspnalt Pavement 9" Full Depth 7,907 SY. S 21 00 $ 166,047 6" Vertical Curb 2,594 LF. $ 10.00 $ 25,940 6' Concrete Sidewalk 2,594 LF. $ 22.50 $ 58,365 - HC Ramps 2 EA. $ 1,200.00 $ 2,400 Mobilization 1 L/S $ 5,000.00 $ 5.000 Strip Topsoil 2,000 CY. $ 1.10 $ 2.200 - Cut/Fill 30,000 CY. $ 1.25 $ 37,500 Fine Grade 7,907 SY. $ 1.20 $ 9,488 Traffic Signals - Portion of total cost 1 EA. $ 60,000.00 $ 60,000 , Traffic Signage 1 L/S $ 1,500.00 $ 1,500 Striping 2,594 LF. $ 3.00 $ 7,782 Street Lighting 5 EA. $ 1,100.00 $ 5,500 Engineering/Surveying 1 L/S $ 14,200.00 $ 14,200 — As Built Drawings 1 L/S $ 1,750.00 $ 1,750 Compaction Testing 1 L/S $ 1,500.00 $ 1,500 Total $ 399,172 — WELD COUNTY ROAD #11 Roadway Improvements Asphalt Pavement 9" Full Depth 29,398 SY. $ 20.00 $ 587.960 — 6" Vertical Curb 5,200 LF. $ 10.00 $ 52,000 6' Concrete Sidewalk 5,200 LF. $ 22.50 $ 117,000 HC Ramps 4 EA. $ 1,200.00 $ 4,800 Mobilization 1 L/S $ 5,000.00 $ 5,000 Strip Topsoil 7,850 CY. $ 1.10 $ 8,635 Cut/Fill 15,700 CY. $ 1.25 $ 19,625 Fine Grade 30,625 SY. $ 1.20 $ 36,750 Traffic Signals - Portion of total cost 1 EA. $ 60,000.00 $ 60,000 Traffic Signage 1 L/S $ 3,800.00 $ 3,800 Striping 5,200 LF. $ 3.00 $ 15,600 — Street Lighting 10 EA. $ 1,100.00 $ 11,000 Engineering/Surveying 1 L/S $ 17,000.00 $ 17,000 As Built Drawings 1 L/S $ 2,500.00 $ 2,500 — Compaction Testing 1 L/S $ 3,000.00 $ 3,000 Total $ 944,670 Pinnacle Farms Metropolitan Improvement District Engineer's Estimate of Probable Improvement Costs — Description Qty. Unit Unit Price Total Cost WELD COUNTY ROAD#12 - Roadway Improvements Asphalt Pavement ' 9" Full Depth 12,077 SY. $ 21.00 $ 253,617 6" Vertical Curb 2,553 LF. $ 10.00 $ 25,530 6' Concrete Sidewalk 2,553 LF. $ 22.50 $ 57,443 HC Ramps 2 EA. $ 1,200.00 $ 2,400 Mobilization 1 L/S $ 5,000.00 $ 5,000 Strip Topsoil 3,850 CY. $ 1.10 $ 4,235 - Cut/Fill 15,400 CY. $ 1.25 $ 19,250 Fine Grade 7,510 SY. $ 1.20 $ 9,012 Traffic Signage 1 L/S $ 1,200.00 $ 1,200 — Striping LF. $ 1.50 $ 9,036 Street Lighting 10 EA. $ 1,100.00 $ 11,000 Engineering/Surveying 1 L/S $ 14,000.00 $ 14,000 — As Built Drawings 1 L/S $ 2,200.00 $ 2,200 Compaction Testing 1 L/S $ 1,500.00 $ 1,500 Total $ 415,423 — LIBERTY RIDGE Roadway Improvements Asphalt Pavement 7" Full Depth 5,837 SY. $ 16.50 $ 96,311 — 6"Vertical Curb 3,012 LF. $ 10.00 $ 30,120 6' Concrete Sidewalk 3,012 LF. $ 22.50 $ 67,770 HC Ramps - 8 EA. $ 1,200.00 $ 9,600 — Mobilization 1 L/S $ 5,000.00 $ 5,000 Strip Topsoil 2,633 CY. $ 1.10 $ 2,896 Cut/Fill 9,400 CY. $ 1.25 $ 11,750 - Fine Grade 7,000 SY. $ 1.20 $ 8,400 Traffic Signage 1 US $ 1,200.00 $ 1,200 Striping 1580 LF. $ 3.00 $ 4,740 Type Ill Barricade 3 EA. $ 1,000.00 $ 3,000 — Street Lighting 10 EA. $ 750.00 $ 7,500 Engineering/Surveying 1 L/S $ 25,000.00 $ 25,000 As Built Drawings 1 L/S $ 2,200.00 $ 2,200 — Compaction Testing 1 L/S $ 1,500.00 $ 1,500 Total $ 276,987 — Sub-total Roadway Improvements $ 2,036.252 Contingency 5% $ 101,813 Total Roadway Improvements $ 2,138,064 Pinnacle Farms Metropolitan Improvement District Engineer's Estimate of Probable Improvement Costs — SANITARY SEWER AND STORM DRAINAGE IMPROVEMENTS Description Qty. Unit Unit Price Total Cost COLORADO STATE HIGHWAY 52 Drainage System Extend 8'x8' Box Culvert 75 LF. S 750.00 S 56,250 Extend dbl 6'x10' Box Culverts 110 LF. S 650.00 S 71.500 48" RCP Culvert Pipe (Bored) 170 LF. S 350.00 S 59.500 Rip Rap 210 TON $ 75.00 S 15.750 — 15' Type R Inlet 5 EA. $ 4,000.00 S 20,000 5' DIA. Manhole 1 EA. $ 2,500.00 5 2,500 18" RCP Storm Sewer Pipe 400 LF. $ 35.00 $ 14,000 - 24" RCP Storm Sewer Pipe 460 LF. $ 38.00 $ 17,480 30" RCP Storm Sewer Pipe 800 LF. $ 45.00 $ 36,000 36" RCP Storm Sewer Pipe 60 LF. $ 50.00 S 3,000 - 24" RCP FES 1 EA. S 350.00 $ 350 36" RCP FES 1 EA. S 450.00 S 450 Outlet Structure 1 EA. $ 4,500.00 S 4,500 — Total $ 301,280 WELD COUNTY ROAD #11 Drainage System — 8'x 5' Box Culvert 264 LF. $ 650.00 $ 171.600 Rip Rap 140 TON $ 75.00 S 10,500 15' Type R Inlet 8 EA. S 4,000.00 S 32,000 — 5' DIA. Manhole 5 EA. S 2,500.00 $ 12.500 18" RCP Storm Sewer Pipe 370 LF. 5 35.00 $ 12.950 24" RCP Storm Sewer Pipe 1055 LF. $ 38.00 5 40,090 - 30" RCP Storm Sewer Pipe 500 LF. 5 45.00 S 22.500 36" RCP Storm Sewer Pipe 120 LF. $ 50.00 5 6,000 60" RCP Culvert Pipe 260 LE. 5 150.00 $ 39,000 24" RCP FES 1 EA. $ 350.00 $ 350 36" RCP FES 1 EA. $ 450.00 $ 450 Total $ 347,940 - WELD COUNTY ROAD#12 Drainage System 6'x 10' Box Culvert 550 LF. $ 650.00 S 357,500 — 8'x 5' Box Culvert 220 LF. $ 500.00 $ 110,000 Rip Rap 280 TON $ 75.00 5 21,000 Type R Inlet 5 EA. $ 4,000.00 $ 20,000 — 5' DIA. Manhole 4 EA. $ 2,500.00 $ 10,000 18" RCP Storm Sewer Pipe 120 LF. S 35.00 $ 4,200 24" RCP Storm Sewer Pipe 400 LF. S 38.00 $ 15.200 36" RCP Storm Sewer Pipe 400 LF. $ 50.00 $ 20,000 - 42" RCP Storm Sewer Pipe 500 LF. $ 70.00 $ 35,000 42" RCP FES 1 EA. $ 600.00 5 600 Total $ 593,500 Pinnacle Farms Metropolitan Improvement District Engineer's Estimate of Probable Improvement Costs — Description Qty. Unit Unit Price Total Cost LIBERTY RIDGE Drainage System — 8'x 12' Box Culvert 325 LF. $ 750.00 $ 243,750 Rip Rap 300 TON $ 75.00 $ 22,500 15' Type R Inlet 11 EA. $ 4,000.00 $ 44,000 — 5' DIA. Manhole 3 EA. $ 2,500.00 $ 7,500 6' DIA. Manhole 2 EA. $ 3,000.00 $ 6,000 Depress Petroleum Pipeline 1 L/S $ 20,000.00 $ 20,000 - 18" RCP Storm Sewer Pipe 120 LF. $ 35.00 $ 4,200 24" RCP Storm Sewer Pipe 400 LF. $ 38.00 $ 15,200 30" RCP Storm Sewer Pipe 330 LF. $ 45.00 $ 14,850 - ' 36" RCP Storm Sewer Pipe 260 LF. $ 50.00 $ 13,000 42" RCP Storm Sewer Pipe 230 LF. $ 70.00 $ 16,100 36" RCP FES 1 EA. $ 500.00 $ 500 - 42" RCP FES 1 EA. $ 600.00 $ 600 Total $ 408,200 Other Drainage Improvements 4'x 8' Box Culvert 240 LF. $ 450.00 $ 108,000 Rip Rap 500 TON $ 75.00 $ 37,500 Local Outlet Structures 2 EA. $ 4,500.00 $ 9,000 — Regional Outlet Structure 1 EA. $ 10,000.00 $ 10,000 Regional Pond Grading 20000 CY. $ 2.00 $ 40,000 24" RCP Storm Sewer Pipe 80 LF. $ - 38.00 $ 3,040 - 30" RCP Storm Sewer Pipe 80 LF. $ 45.00 $ 3,600 24" RCP FES 1 EA. $ 350.00 $ 350 30" RCP FES 1 EA. $ 400.00 $ 400 Channel Stabilization - Godding Hollow 12 EA. $ 8,000.00 $ 96,000 Engineering/Surveying 1 L/S $ 20,000.00 $ 20,000 As Built Drawings 1 L/S $ 3,500.00 $ 3,500 Compaction Testing 1 L/S $ 4,500.00 $ 4,500 — Total $ 335,890 SANITARY SEWER — Phase I 18" PVC Sewer Main 2871 LF. $ 48.00 $ 137,808 15" PVC Sewer Main 585 LF. $ 32.00 $ 18,720 - 12" PVC Sewer Main 3800 LF. $ 30.00 $ 114,000 4' DIA. Manhole 26 EA. $ 2,150.00 $ 55,900 Plug & Future Stubs 3 EA. $ 300.00 $ 900 — Total $ 327,328 Phase II 15" PVC Sewer Main 2740 LF. $ 32.00 $ 87,680 — 4' DIA. Manhole 12 EA. $ 2,150.00 $ 25,800 Plug & Future Stubs 1 EA. $ 300.00 $ 300 Total $ 113,780 Sub-total Sanitary Sewer and Storm Drainage Improvements $ 2,427,918 Contingency 5% $ 121,396 TOTAL SANITARY SEWER & STORM DRAINAGE IMPROVEMENTS $ 2,549,314 Pinnacle Farms Metropolitan Improvement District Engineer's Estimate of Probable Improvement Costs WATER DISTRIBUTION SYSTEM Description Qty. Unit Unit Price Total Cost 12" PVC Water Main 6000 LF. S 27.00 S 162,000 - 8" PVC Water Main 320 LF S 21.00 $ 6,720 8" MJ Fittings & Valves 320 LF. S 5.00 S 1,600 8" Plug W/ 2" B.O. 8 EA. S 1,200.00 S 9.600 12" MJ Fittings & Valves 6000 LF. S 6.00 S 36,000 - 12" Plug W/ 2" B.O. 2 EA. $ 1,800.00 S 3,600 Fire Hydrant Assembly 10 EA. $ 2,200.00 S 22,000 Master Meter 1 EA. $ 75,000.00 $ 75,000 Total $ 316,520 Contingency 5% $ 15,826 — Sub-total $ 332,346 PARKS & RECREATION Description Qty. Unit Unit Price Total Cost — Landscaping - Hwy 52 2.36 AC. $ 60,000.00 $ 141,600 Non-Potable Water System 1 L/S $355,000 $ 355,000 Wetland Mitigation 1 L/S $ 30,000.00 $ 30,000 Total $ 526,600 Contingency 5% $ 26,330 — Sub-total $ 552,930 IMPROVEMENT COST SUMMARY - ROADWAY IMPROVEMENTS $ 2,138,064 SANITARY SEWER AND STORM DRAINAGE IMPROVEMENTS $ 2,549,314 WATER DISTRIBUTION SYSTEM $ 332,346 PARKS & RECREATION $ 552,930 TOTAL COST OF IMPROVEMENTS $ 5,572,654 wBCEngineeiing,llP, September 19, 2002 City of Dacono 512 Cherry Avenue Dacono, Colorado 80514 RE: Proposed Pinnacle Farms Metropolitan District To Whom It May Concern: I, Steven F.Wells, a Registered Professional Engineer in the State of Colorado, have reviewed the Engineer's Estimate of Probable Improvement Costs within the Service Plan for Pinnacle Farms Metropolitan District in the City of Dacono,Colorado. The Engineer's Estimate of Probable Improvement Costs was based on the following information and assumptions: A. The quantities for each item were based on a conceptual design of public improvements prepared by WBC Engineering,LLP. that was not reviewed or approved by appropriate governing agencies. B. Quantities for State of Colorado Highway No. 52,Weld County Road 11, and Weld County Road 12 were based on one half (1/2)of the roadways being fully improved. C. Unit costs were based on a project estimate prepared by Hall-Irwin contractors dated July 9, 2002,and recent bid costs for similar projects. Based on these assumptions, I believe that the Engineer's Estimate of Probable Improvement Costs contained within the Service Plan for Pinnacle Farms Metropolitan District is reasonable for the public improvements portion of this project. Additionally,I have reviewed the exhibits of the location of public improvements within the Service plan for the district(Service District Roadways, Storm Drainage System,Water Distribution, and Sanitary Sewer System,Parks and Open Space)and believe the exhibits represent the conceptual design of the public improvements prepared by WBC Engineering, LLP. Sincerely, WBC Engineering,L . � � �. ►y C * �13 • • W . Steven F. Wells, P.E. fief Managing Partner •• '•� t, 6, C•\', - 224 Potomac Street, Suite 102, Aurora, Colorado 80011 Phone: 303-365-9825 Fax: 303-365-9827 EXHIBIT D Drawings of the Location of Public Improvements •CQ • : •D.�•TATE . -52----'-' _4979..— 4.982 �1r �.^ •r�— �I Al ■ II ` - ( .I ACONO, ,, f. • / N 1*dwa U. W ca H r !- ..� ___ w; 1►I ��tII e4 —1 _.r'•—• P e • 1 f _l f 1 ■■ �� 1, I III J ,• , ,li — `t, ? _ f `. �' I • ■ ■■ �• ■■.",I ,�� ►'/ �`¢� it I. • i I ti I}1 IMM ME ,� , Y • ti t ) • : :: r .�' �,,,,;o:� { e �n pnn� oax�o um rJ i i i__` r.. s` I; , i �1 Ci I ; i` I . I'lII IIHHIIIIIII--9 1j ;�£047 mnn iuniinnnuiifh ••, . I - I WED CO.t L 'R I .. `p J D.9-2 - 1 I ' '� r ; / //1' r• .. 1"'__ ... ..,x'....46 4' r J ' I 'I / NI �'• i �,l +lam I'•,• `t •r J IV I i ' ii I r' ` i •...�_ CbRE'l Ail' -.<1. N W E Service District Roadways SCALE: V=1,0001 - / r 6+ COI. • $IAnEr H1G j �2 i• ti yy - i _._..- -' ^ -t err• a�-��.r . ��' :912 .` j__ ry F PVC :. • _ Itplhi\O �1 r • ss s,�acono __ i • fA l • _ . , j` �... • Mine • o . I. Dump: w Ir�aPCK��—`_�� v -i_ <4 '� C w d". . 7. a i f • I no, a� t,�, � j J a as �:c, aau I • I . u 1 I a ons as an a�ii' f M - 1 I. I A l iii i,'�! • t• , V 'i r I: '•r f.. . ,I ;t► r ' j numr re _- i nk ;� i . / ` WEirb O. R0. 12 t I9, i /1 �— . ..,r'.M io 5 �J 'I / IIGC �t r / r 'n I `, I i., 1 . I i' ,) — !I ! _ " Service District W E Sanitary Sewer System - SCALE: 1"=1,000' • • �LL__cLQ.ISEW• .$11501E/8-10 �••'• 52 ---- x��,p,1 . '_ ff it ...__ - "�-' 9 a 7 ---- - T-- - Alf '4�City'o I , r� •) Ii. _i ...0 • ; ;'i -cQa con o--_ 4.. \ it ;• /b 1 i •� o i--- I -'I-— k _ L._.. ii E?.... _.. ' Master _ r :;;i Mine — I IA • 1 i'I iLtii^[1rr •� Meter dump: .. W /► a -L co ; P LEL • a• 9 _ .. ..._f�... .__I, �''- to I�� r--�♦♦.♦♦♦♦ � ' r -:i- n f • -- I� u 5. j . 13i r. .. i•.�` 1�ii i 1 . 1 I ; ine f i►i'„ i i + : iii ►�\ •. � I� �OG 1 \ 11 0 / ; i irJ • In ��t4 ! /r 1 •1 o-' _ I1 `1,.-, r•-' .. ,. •' i rt 1.,.,.7.,.1, In— :� . • i i i s1 I/u1n11111t1 , i VIII UIIIIIOIIIIOO� f 4 .� ii 3047 ! .' • �' nnmunmm�ur _ i . — w Ism m�f 'r `` WEj.�b I O.. I a 12;:i.., 6'..? III... , I '1 I i t . / ' , 1 I .(7.,1 • / ,1 1 ' IV 1yI I. ` f I r ri. r�'1 '. I {�iV , ; /' ."�IJY ' S~ (f- '. I • , I v.L- -...,^ ..li..�-..T.r .til r.-•N Service District W / E Water Distribution SCALE: 1"=1,000' S — r-...-- de^RCP ' f NI. Culvert I 1 '( ,._, tVi# 11 cod • .�JAT�,�N1G , s? •. -----�==� , . • � • 4479.. 6‘i';----.1`2.-e'x 5' tl . I / �I''1Box Culvert r r .1 ;: ..� is , i C.x.17)/ of _ • i _- r \ Sewer'.' i ' Storm .•4 .' 3e Ir ( �.--.. �• . �. I }I I r' ) Detention ' � ./ — e ` 1 } / Pond �i r �i. I r1 ., c (} — adage« f Storm . „ ©.... ,•. Mine -'-- ,5 r : I /��loxeGxilwrNf �� Sewer U - � i�s — I '5. I I, Storm J I: o Dump: • •Sewer A P J ~ems ls�: 1 et% ..,.—-.. __.-— --...,... ' p Pond I — Co�� q tiPI&,iØYiJksAt4 ._IF.. ... t ;� soxCulvorts.� �, �,, �:: - -_I_ f . i z _ • i, r ■r w/Stm inlets !`f t�f`f r . III r` — i 1 � 4•�hPI i' ' ��d I I / + I . J f 5 I = i = . � �� storm j 1 r =; ��P++ 1�+ i. '4 Sewer I III 5 i r ■ , f 1 i i i ■ ' ! +I 1518\ 2\\\ \\\\ ', i 2-60"RCP i I. l• _ii :- J Culverts • ■ Storm inlets i 5-6'x 10' � 1 ! Storm IV I1111111111Rr:1■— / Box Culverts + s�« mnunnunun�r t�,' ' I, 50'47 I fosmm�a WEB b 1 O.. I�El 121.. `' . I . i i I .,. 2•e'xs' rI I } r M f ' '•1 sox culvert. • 1' i .r. ..{•.. 1 &Storm Inlets !: / / i i r ,. r ^,� •1 N Service District W E Storm Drainage System SCALE: 1"=1,000' - 5 1 ` IMgNon-Potableation Pond•' - • `- r'0 Regional I H' ~ !1.1. ..(71,1--" ' ll - r 1 col. T/�TC [�I/� l Detention •�, � _ 7T - -477.• _�+ w mar "il ^-,-- Irrigation ■/ ■ �. ; ..3. PumpStation t / .. ��'•-- C•,c;ty IA- ` - i Dacono 1 Non-Potable I- - r , ' I I Irrigation ! -N--‘8°42:".1/4.../: -, . t . � system �_,•-I w l• / fi •1„ i t ti /- I l .. i 2 i___Jr ..-. Ip I ,;l Mine 14 I 1 o . = Dump: w -, l I ` -- a 1 14� N unV iir a ) .'!!:4 PEt H L { n f i Lm •I''. Jr.- fr it �� / - it ' i r J 5 • ' irI, iii O- J" I •IPtt odd`,,�' I • / '" ill 1 •1 t Qo n alllll■Illluii {iii mss'.. •, WE b � ail* 12� �' .� � ,�_L. I- is 1 I 'lI ,t /116 /� /r -------.7,-- . ._fi-„/6 t(7t p / I 1' f� r7 ' 1 - 1i i•' tn. N Service District - a.I` E Parks & Open Space /1\ SCALE: 1"=1,000' S y G EXHIBIT E Financing Plan Forecasted Cash Surplus Balances and Cash Receipts and Disbursements Market Projection Consultant's Analysis a Market Projection Consultant's Letter of Reasonableness = _ Developer's Letter in Support of Market Projections I I I I I I I I I I I I I I I I I I I PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) Page 7 FORECASTED CASH SURPLUS BALANCES AND CASH RECEIPTS AM)DISBURSEMENTS DEBT SERVICE AS OF THE DATE OF IORMATION AND FOR T1 1E CALENDAR YEARS ENDING TIIROUGII 2039 Series 2004 Bond Issue Series 2006 Bond Issue Series 2009 Bond Issue Issued, December 1.2004 51,935,000 Issued: December 1,2006 $1,925,000 Issued: December 1.2009 51,710,000 Total Interest Rate: 700% Interest Rate: 700% Interest Rate: 7.00% Debt Year Service Year Principal Coupon I Interest I Total Principal I Coupon I Interest I Total principal ` Coupon I Interest I Total 2003 0 2003 2004 0 2004 2005 7.00% 135,450 175.450 135.450 2005 2006 7.00% 135.450 135.450 135.450 2006 2007 7.00% 135,450 135.450 7.00% 34,750 34.750 270,200 2007 2008 10,000 7.00% 135,450 145,450 7.00% 34,750 34,750 280.200 2(08 2009 15,000 7.00% 134,750 149.750 7.00% 34.750 34.750 284,500 2009 2010 15.000 700% 133,700 148,700 10,000 7.00% 34,750 44,750 7.00% 119,700 19,700 413,150 2010 2011 20,1100 7.00% 132.650 152.650 5,000 7.00% 34,050 39.050 700% 119.700 19.700 411.400 2011 2012 20,000 7.00% 131.250 151.250 15,000 7.00% 33,700 48.700 7.00% 119.700 19,700 419.650 2012 2013 25.000 7.00% 129.850 154.850 10,000 7.00% 32.650 42.650 700% 119.700 19.700 417,200 2013 2014 30,000 7.00% 128.100 158.100 15,000 7.00% 31.950 46,950 7.00% 119.700 19,700 424.750 2014 2015 30.000 7.00% 126,000 156,000 20,000 7.00% 30.900 50.900 700% 119,700 19,700 426,600 2015 2016 35,000 7.00% 123.900 158.900 25.000 7.00% 29,500 54.500 7.00% 119.700 19,700 433,100 2016 2017 40.000 7.00% 121.450 161.450 20,000 700% 27.750 47.750 700% 119.700 19.700 428,900 2017 2018 45,000 7.00% 118,650 163.650 25,000 700% 26,350 51.350 5.000 7.00% 119.700 24,700 439,700 2018 2019 45,000 7.00% 115.500 160,500 30.000 700% 24.600 54,600 5.000 7.00% 119,350 24.350 439,450 2019 2020 55.000 7.00% 112,350 167,350 35000 7.00% 22,500 57.500 5,000 7.00% 119.00) 24.000 448.850 2020 7021 60,000 7.00% 108,500 168,500 35,000 700% 20,050 55.050 5.000 700% 118.650 23,650 447,200 201_1 2022 65,000 7.00% 104.300 169,700 45,000 7.00% 17.600 62.600 10000 7.00% 118,300 28,300 460,200 2022 2023 70000 7.00% 99,750 169.750 45.000 700% 14,450 59,450 10,000 7.00% 117.600 27,600 456,800 2023 2024 80,000 7.00% 94.850 174,850 50.(00 7.00% 11.31)0 61,300 15,000 7.00% 116.900 31,900 468,050 2024 2025 85.000 7.00% 89.250 174.250 55.000 7.00% 07,800 62,800 15,000 7.00% 115.850 30.850 467.900 2025 2026 95,000 7.00% 83.300 178,300 60,000 710% 03,950 63.950 20,000 7.00% 114,800 34,800 477,050 2026 , 2027 100.000 7.00% 76,650 176,650 65000 7.00% 99,750 64.750 20,000 7.00% 113.400 33.400 474,800 2027 2028 110.000 7.00% 69.650 179.650 75.000 7.00% 95.200 70.200 20,000 7.00% 112.000 32,000 481,850 2028 2029 120000 700% 61.950 181,950 75.000 700% 89,950 64.950 25.000 7.00% 110.600 35.600 482.500 2029 2030 130000 7.00% 53.550 183,550 90.000 7.00% 84,700 74.700 25.000 7.00% 108.850 33,850 492,100 2030 2031 140(00 7.00% 44.450 184,450 95.000 700% 78.400 73.400 25.000 7.00% 107,100 32.100 489,950 2031 2032 150.000 7.00% 34.650 184,650 105,000 7.00% 71,750 76.750 30.000 7.00% 105.350 35.350 496,750 2032 2033 165.000 700% 24,150 189.150 115,000 700% 64,400 79,400 30,000 7.00% 103.250 33,250 501,800 2033 2034 180,000 7.00% 12,600 192,600 125,000 7.00% 56,750 81.350 30,000 700% 101,150 31.150 505,100 2034 2035 325,000 7.00% 47,600 72,600 40000 7.00% 99,050 39.050 511,650 2035 2036 355100 7.00% 24.850 79.850 40,000 700% 96.250 36,250 516.100 2036 2037 410,000 7.00% 93.450 03.450 503.450 2037 2038 445,000 7.00% 64,750 509,750 509,750 2038 2030 480,(X10 ]W0. 33,000 SIJ,(A)0 5/3,(.0X/ 2039 1935(X0 11417.550 4!142,550 19_150X1 3.221050 5,140.05(1 1.710(X)0 1.266.5511 4,976550 15.065,150 I PSI'(11'I'0(h'Ii1-US I ISE Ill'P0 ICI:1 119 I PSI!OP I1110CI p.US (',rand Two! ('onu,uanon/Or g Cusp 1,7811,743 I)rvclulwt Ruuubmsemrut 1.848(1X1 IAveloper Keuubunuownt 1,641(8)0 'u 5,209.743 Ggmaiued Iwc,est 76,857 ('aptc heed Interest 11 Capitalized Interest 0 76,857 I Issuance('opts 77,410 Issuauua Costs 77,000 Issuance Costs 69,00 223.400 1935,000 1.925(X0 1710,00 5.570.001 u A"anes 17(016o(Nr1Nr.uwul Cmn SEE SUMMARY OF SIGNIFICANT aOI(ECAJ T ASSUMPTIONS AND ACCOUNTING POLICIES AND ACCOUNTANT'S REPORT 1.54,42221L,reser,'lpugrcO21812 RnmastNPnnacle panes 09172002.s 1s Printed vnpm77Ill p1, PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 1) NATURE AND LIMITATION OF FORECAST This forecast of financial information is for the purpose of a financial analysis of the proposed financial plan of Pinnacle Farms Metropolitan District (the _ "District"). It is to display how the proposed facilities and services are to be provided and financed. This financial forecast presents, to the best knowledge and belief of Management of the District, the District's expected cash position and results of cash receipts and disbursements for the forecasted periods. Accordingly, the forecast reflects Management's judgement, as of September 17, 2002, the date of this forecast, of the expected conditions and the District's expected course of action. The assumptions disclosed herein are those that Management believes are significant to the forecast and are not all-inclusive. There still usually may be differences between forecasted and actual results, because events and circumstances frequently do not occur as expected, and those differences may be material. The initial market values of residential properties have been inflated by 2% per year, compounded annually, for each year beyond 2003. Also, based upon the biennial revaluation of property required by state statute, an increase in property valuation of 2% due to reassessment has been assumed every other year. The forecast includes inflation of 2% per year beginning in 2004 on administrative disbursements. NOTE 2) ORGANIZATION The Petitioners for the formation of the District, a quasi-municipal corporation, are in the process of organization. The District will be governed pursuant to provisions of the Colorado Special District Act (Title 32). The District will operate under a service plan approved by the City of Dacono (the "City"). The District's service area is located entirely in Weld County in the City. The District is being established to provide financing for the acquisition, installation and construction of street, traffic safety control, water, sanitary sewer, storm drainage _ and park and recreation public improvements and facilities. Page 8 PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 2) ORGANIZATION (continued) As set forth in this plan, the District is forecasted to issue three series of bonds. Formation of the District is intended to be timed to allow for the proper legislative,judicial and election process to be completed in order for the District's electors to be able to vote for the authorization of debt and TABOR questions in November 2002, and tax levies for tax collections in 2004. The Petitioners expect the favorable approval at the election since they constitute the majority of the current eligible electors within the proposed District's boundaries. NOTE 3) PETITIONERS FOR FORMATION The Petitioners for Formation of the District are the current landowners of the property included within the boundaries of the District. The Developer is Pinnacle Farms LLC. NOTE 4) BASIS OF ACCOUNTING The basis of accounting for this forecast is the cash basis which is a basis of accounting that is different from the generally accepted accounting principles under which the District will prepare its financial statements. NOTE 5) PROPERTY TAXES The primary source of revenue or cash receipts will be ad valorem property taxes. Property taxes are determined annually by the District's Board of Directors and set by County Commissioners as to rate or levy based upon the assessed valuation of the property within the District. The Weld County Assessor determines the assessed valuation. The levy is expressed in terms of mills. A mill is 1/1,000 of the assessed valuation. The forecast assumes that the District will be able to set its mill levy at 35.000 mills for debt service and administration purposes. Page 9 PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 5) PROPERTY TAXES (continued) The forecast assumes that the mill levy has not been adjusted according to provisions of the State's Gallagher Amendment. The Gallagher Amendment states that residential assessed values Statewide must be approximately 45% of total assessed values. When the market values of residential property increase faster than the values of nonresidential property, the residential assessment ratio must decline to keep the 45 percent/55 percent ratio. According to information as set forth in the Colorado Legislative Council Staff's "Assessed Values and Property Tax Projections" issued in December 2001, the residential assessment rate is projected to decline from its current 9.15% for 2002, to 8.31% in 2003 (for collection in 2004), 7.76% in 2005, and to 7.23% in 2007. This forecast has included the current residential assessment ratio of 9.15% throughout the term of the forecast period. Historical trends would indicate that adjustments under the State's Gallagher Amendment would continue to lower the assessment ratio and adjust the mill levy upward. Since residential values have increased greater than commercial values since 1986, the ratio has decreased in most reassessment years except for 1999 which indicated no change. This forecast does not reduce the current residential assessment ratio beyond 9.15% since it is assumed that the District's Board will increase the mill levy as allowed under the service plan and election questions, which contain provisions that will allow the District to increase its mill levy above the forecasted 35.000 mills to override these reductions in ratio beyond 2003 up to the maximum mill levy of 50.000 mills. This maximum mill levy limitation may be increased or decreased to reflect changes in the method of calculating assessed valuation. The projections of the Legislative Council Staff are estimates only, do not have force of law, and may or may not occur as projected. The assessed valuation for the District is dependent upon the build-out schedule of the homes within the District. Management of the District has based the _ estimate of build-out on their forecasted build-out schedule. The forecasted development build-out schedule and conversion to assessed valuation is presented as a Schedule. The assessed valuation rate for raw ground and developed lots is _ 29% until a home is constructed. The beginning assessed value of the land totaling 220 acres which constitutes the District is based on information contained in the Weld County Assessor's records as of July 23, 2002. Page 10 PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 5) PROPERTY TAXES (continued) Increases to valuation for the development of infrastructure within the District for finished lots held for build-out are included in the forecasted assessed valuation. No assessed valuation has been assumed for State Assessed property that may be owned by public utilities within the District. The property taxes resultant from the above mill levy and assessed valuation has been reduced for the Weld County Treasurer's fee for collection of the taxes at 1.5% and further reduced for uncollectible taxes of one-half percent (.5%). NOTE 6) SPECIFIC OWNERSHIP TAXES Specific ownership taxes are set by the State and collected by the County Treasurer primarily on vehicle licensing within the County as a whole. The specific ownership taxes are allocated by the County Treasurer to all taxing entities within the County. The forecast assumes that the District's share will be equal to approximately 10% of the property taxes collected. NOTE 7) DEVELOPER ADVANCES The forecast assumes that the Developer will advance funds to the District for organization and operational costs as shown on the Summary page of the forecast and may be reimbursed from bond proceeds. The forecast also assumes that the Developer will advance all funds needed for construction costs to the District. To the extent that bond proceeds are available for construction payments in any year, the Developer advance (or Developer note) would be reduced accordingly. Interest was not accrued on Developer advances in this forecast, as its only impact would be to reduce the amount of bond proceeds available to reimburse the Developer for capital infrastructure costs, and not all of the infrastructure costs can be funded by bond proceeds in this Plan (see Note 10). The Developer advances are subject to annual appropriation and therefore not _ considered to be multi-year fiscal obligations. Page 11 PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 8) INTEREST INCOME The forecast has included interest income on monies that are forecasted to be on deposit or invested by the District at the prior year-end at an interest rate of 3%. NOTE 9) ADMINISTRATIVE DISBURSEMENTS Administrative expenditures include the services necessary to maintain the District's administrative viability such as legal, accounting and audit, general engineering, insurance, banking, meeting expense, and other administrative expenses. Administrative costs, including those costs associated with the organization of the District, have been included in the forecast at $70,000 for 2002. These Administrative costs are reduced to $50,000 for 2003, and then in 2004, are increased by 2% per year throughout the term of the forecast. NOTE 10) INFRASTRUCTURE IMPROVEMENTS The estimated cost of the capital infrastructure improvements and organizational costs to be funded under the Plan would be approximately $5,269,743 as displayed on the Debt Service schedule. The forecast assumes that the Developer will advance funds for all infrastructure costs and be reimbursed from bond proceeds to the extent bonds can be issued. The capital infrastructure costs per the engineering estimate exceed the amount that can be reimbursed to the Developer under this Plan. Management expects that the District will allow the Developer to either advance funds to the District or to actually construct the improvements under the District's supervision for reimbursement by the District upon completion to the extent bondable. The reimbursement of the additional costs is subject to the District's authorized indebtedness and other revenue available to the District. The amount of _ infrastructure costs not bondable within the limits of the Service Plan would be a "contribution" by the Developer to the District. There may be additional construction costs in the future. Page 12 PINNACLE FARMS METROPOLITAN DISTRICT (In the Formation Stage of Development) SUMMARY OF SIGNIFICANT FORECAST ASSUMPTIONS AND ACCOUNTING POLICIES September 17, 2002 NOTE 11) DEBT SERVICE The District anticipates issuing general obligation bonds on December 1, 2004 in the amount of$1,935,000, on December 1, 2006 in the amount of$1,925,000 and on December 1, 2009 in the amount of$1,710,000. The proceeds of such debt will be used for issuance costs, capitalized interest on the 2004 bond series only and to reimburse the Developer for capital infrastructure improvements and organizational costs. All bonds are assumed to bear interest at an estimated rate of 7.0% and are assumed to be paid over 30 year periods with final payments on December 1, 2034, December 1, 2036, and December 1, 2039, respectively. Assumptions related to the proposed bond issues have been provided to Management by Kirkpatrick Pettis, the proposed underwriter of the proposed bond issues of the District. Page 13 ❑❑❑❑ ❑❑❑❑ ❑❑❑❑ J❑❑°° RESIDENTIAL MARKET ❑❑°❑ ANALYSIS ❑❑❑ ❑❑❑❑ ❑❑❑ ❑❑❑❑ ❑❑❑❑ ❑❑ ❑❑❑❑ PINNACLE FARMS ❑❑❑❑ ❑❑ DACONO, COLORADO ❑❑❑❑ ❑❑❑❑ ❑❑❑❑ ❑❑❑ - ❑❑❑❑ DODDPREPARED FOR: Epp❑❑ CARLSON ASSOCIATES ❑ ° ❑° PREPARED BY: ❑❑ ❑ THK ASSOCIATES, INC. ❑❑❑ 2953 SOUTH PEORIA STREET, SUITE 101 ❑❑❑ AURORA, COLORADO 80014 ❑❑❑ (303) 770-7201 PHONE ❑❑❑ (303) 770-7132 FAX ❑❑❑ info@thkassoc.com JULY 26, 2002thl Economic & Market Research /Land & Development Planning El ❑ Landscape Architecture /Community Planning & Design ❑❑❑ Golf Feasibility Analysis DISCLAIMER- MARKET & FEASIBILITY ANALYSIS (THK) The following market analysis is. in large part. based upon projections of future events that may, or may not, materialize. Since no one can. by definition, predict the future with certainty or accuracy, actual events may be significantly different than the predictions upon which the market -- analysis is based and. as a result, the opinions expressed in the market analysis may ultimately prove to be wholly or partially in error. Of necessity, the market analysis is also based upon assumptions and facts that have been gathered by. or provided to. us. We have made no attempt to independently verify the accuracy or reasonableness of such assumptions and facts. For these reasons. investors should not rely on this market analysis. or any conclusion. opinion, statement or finding set forth herein, as a basis for making any investment decision. Investors should. instead. make and rely only upon their o‘‘n diligent and independent investigation of all aspects of the proposed investment (specifically including the matters addressed in the market analysis). ANY RESPRESENTATION MADE TO ANY INVESTOR BY ANYONE THAT IS INCONSISTENT WITH. OR CONTRARY TO, THE ABOVE STATEMENTS IS FALSE, NOT AUTHORIZED AND SHOULD NOT BE RELIED UPON FOR ANY PURPOSE. TABLE OF CONTENTS Page I. Introduction 1 II. Site Description 3 III. Employment Base Analysis for the Four-County Market Area _ A. Employment Growth Trends 5 B. Population and Household Growth Trends in the Four-County Market Area 11 C. Residential Construction Trends in the Four-County Market Area 14 D. Population and Household Projections for the Four-County Market Area 24 E. Growth and Development Trends in the Pinnacle Farms Primary Trade Area 26 IV. Residential Market Analysis A. Projected Residential Demand 30 B. Residential Purchasing Capacity and Demand by Price Range for the Pinnacle Farms Primary Trade Area 34 C. Active Detached Residential Projects in the Pinnacle Farms Trade Area Environs 36 D. Proposed and Planned Detached Projects in the Pinnacle Farms Trade Area Environs 45 E. Active Attached Residential Projects in the Pinnacle Farms Trade Area Environs 48 F. Proposed Attached Residential Projects in the Pinnacle Farms Trade Area Environs 50 V. Single-Family Detached and Attached Unit/Lot Sales Potentials at the Pinnacle Farms Site 51 PINNACLE FARMS THK Associates,Inc. I. INTRODUCTION This study quantifies the development potentials for residential uses on the 310-acre Pinnacle Farms site in Dacono, Colorado. The primary influences on the development potentials for _ the site are the supply and demand forces affecting the local real estate market. Projections for growth.have been made based on a synthesis of the direct market forces and the various indirect influences affecting the aforementioned real estate market. Trends in business activity, employment, and population in the regional environs are the principal determinants of real estate demand. In order to establish opportunities for development, a comprehensive analysis of the regional economic base and its prevailing demographic trends has been undertaken and is included in Section Ill of this report. The focus of this section of the analysis is on establishing past trends and projecting future increases in employment, population and households. Historic employment trends by industry in the four-county Dacono market area (Adams, Boulder, Weld, and Larimer Counties) are reviewed in order to determine the specific growth trends of the region's industries. Based on the historical performance of the region's economy,future employment growth by industry is projected for the region. These estimates provide the principal basis for making demographic projections and for quantifying the overall demand for all types of real estate uses. The residential section of the market analysis isolates residential market trends in the four- - county market area and the primary trade area for the Pinnacle Farms site in order to ascertain the potential for developing residential units on the subject. Residential demand in the region is segmented by unit type and tenure. This allows THK to determine the housing products, price or rent ranges and densities that are most appropriate for the residential market in the site vicinity. Data that was collected and analyzed includes historical and projected population and household growth, household income, demographic characteristics, historical residential construction trends, and absorption by unit type. These indicators enable THK to project household growth and residential demand by unit type, price or rent range, size and density for the subject site. Any possible constraints on residential demand are also discussed. Following the residential demand analysis is an inventory of competitive residential projects in the trade area environs. This comprehensive product review allows THK to identify what gaps exist in the marketplace and what type of residential project will best capitalize on the opportunities available in the area. Specific recommendations are made regarding the optimum unit prices, and a comprehensive absorption schedule of product by price range concludes the analysis. PINNACLE FARMS 1 THK Associates,Inc. . Collins tali"' „" - 11.00 �'°'45°,� Regional Location "'�""° •eW.lu. Wed Jul24 15:11 2002 10 Mies \ . . ` m 2 I • w O . Lm ;finnan .wn a 10 KM w Fs soma. cy,., s 4 inner arbi ' Nn Hawn r •Wlndaor•c•.i �wuw. O Wawa'* •rte c • :'°^ pill -vvma.a,w .La .,..c. _.. - Y Gee pew owned i draw. +tlw Palen •'•w,nf.,..,.'A a.n KemalKemal —f -Ka•ren Ia . •1.140 Campion •Sa •ean aialN1 bun C",.-'1.7...5 W * e podia.. ^:_ '1. G.•1 Jonnst . • / i .W..11cem 'c. a arinWd •PuIY. Pee O n r% level PYaaced WMW , •RMVM 'PF.� u eYNO endow .f • Maw EL.w p„,,,,,r w /mewl -'+,* /mate •Wap.w .F — us. c1 1on• Y d II S 9 c,.a flow ri lal•vlll — • O' •MSNM •LanFaaN ® aXLw•u a . . .�..swim. / . AV',. 1 a `.LJ St.,'PN Na GM Cow • e LongmontCps �. GO aabnwdi F�a. an.wcr dtne, Iona ° r..q. `M, •aa.n new• oll r IV cL d1WMalewn O we" et l )))JJJ qnN ae. •Pl..waVk. lIlatMa A Ladp.OI1N EA1O2,2111arkk g v amateurs L. �WJNlrwl '^ O✓ '-�... • .r� iFl Lupton B le" • Roan saw / J. Sr id Hill •tal• Ptaan "nal1 • su.a.as a.a• / Arlo • atw awn" ' I.s -a a.- an" •W�y.nkay u9•rloar cf uP. ..P. Cam. Fy Drre^l 4r 5 k stmt. vS �..:. ��. /4... F v.c rmu.r c °i`N �� _._ •� m la+aa na 1 s nmir a)raaw •SeJterM na wIN •p P/. T a 1 parlor .make �inadiX• .n pn Goliath ..�.o ywrw rya Wblltle •nwmt Broomfield wow Ea lake • n L a - . . I�6N•wmwl0dn C.rtpanar• wale.�'" d awao ,,The 12. arl1/21011 W oo.w, 4 OEN 1 .u, is.. - Fed H .h�a1 / ),I wdili_. • • •P Tre•Garcona W Wm Nil n � A.Pal •City • 'vim CaMer l • d,,/r.�� n l�-..".' a ri olds. Ridge �aa, 1W ,. PI a Viewr �[ r} 'J< • N ■��n 11 W M1NoDe loafs 4;0 on �3l.l•ul II Wady* • la Cate/ _ 9nbkvaN �9na \ \ r pow Met cot .y ... '. , k,�. + Darin Pa an Mwa• P.M.".( ' n Hillsn .LIhIaL ja •^ 22 a .\ 1 �' - ' Tiny Town � •''I.a C •Minh. V •Y sowgradate \ _ - .\MhdaN - o„nc, Fandsn / \ear ••• •-•• ,19 99 DcLonne. Secci Allis USA v s H. SITE DESCRIPTION The Pinnacle Farms site encompasses approximately 310 acres on the west side of the City of Dacono. Dacono is located in the southwestern portion of Weld County, approximately 28 miles north of downtown Denver, 35 miles south of Fort Collins, and 20 miles west/northwest of Boulder. More immediate neighbors include Northglenn, Brighton and Thornton to the south; and Mead and the Milliken/Johnstown area to the north beyond the city's immediate northern neighbors, Firestone and Frederick. Access to the site is good. Interstate 25,which traverses the length of the state north/south, is just west of the site,and Highway 85, which leads southwest to Interstate 76 and northeast to Greeley, is eight miles to the east. Both of these major transportation corridors can be accessed via State Highway 52, which stretches east/west along the north side of Dacono and the site. Denver International Airport is a 30-mile drive from the site, and the under construction Northwest Parkway intersects Interstate 25 approximately ten miles south of the site. The site sits immediately south of State Highway 52, less than a mile east of Interstate 25. Weld County Road 11 serves as its eastern border and Weld County Road 12 as its southern border. Agricultural uses dominate the lands to the north and east, as well as to the south beyond County Road 12. However, the City of Dacono continues to expand,and much of the surrounding ground is slated for development. Other neighbors in the immediate environs include a United Power Substation to the east across County Road 11, and the Fromby Ford _ Dealership to the west along Highway 52. The site has a modest downwards slope running east to west and has very limited mature vegetation. It sits relatively low but still has good views to the west over I-25 to the mountains. With the exception of several active oil pumps and an old farmhouse fronting Highway 52, the site is open and currently used for farming. The Gooding Hollow Ditch stretches the length of the site and will be used as an amenity for the development's planned 110 acres of open space. All of the site's residential development will be concentrated in its southern half. The portions of county roads 11 and 12 that access the site are currently dirt. At present,the site has ample water to support half of the proposed development. PINNACLE FARMS 3 THKAssociates,Inc. OfiM ' •- Site Vicinity Hill Lake Meg 1Z°° scale 1175,0O Wed Jul 2415:08 2002 2 Miles a $" IWalker I]avYor e1 - —_ _ _ _ -:-_ - --- --— -- --- Worker• 42 _.. gCIkJ]SEGE 4. _ 5KM •-.HI Ltle_ • *mime "Adam Park Mlad 2�1 .Jo`a — Morey _.. — { beM. 243 cawanda O t-. aY r OM Ft Maddw •l 9 Kirkland t'eurr. . .---. Ba.dcr[.A. - °°r°Vaa9ue _. _..-_ ..Ve _ - - - - ae Nt Pad _.- _.__ -_.. __ -• Longmont'. --- a 4. ._-" - ml4, *spring Gulm _ " Hama ...._ _ ♦ ___.. E lone _.. Oxnklbt - �- - �i Volimar — ♦P Cir.ml/nh -____�leaaant View Ridge __ __ - Flrestane _.- :— _ _.._ - . a . ₹wnamn- __ — — — I sFrederkk .. —.___ -_— Plumes —-a* ` O tLMMdn zz - ` _ _� ♦ 1/4 ode Fa„_ © is a - - /slab CnI Mine Ju mod,_ Bm Vaulty ea tanI, ,_- Canfield_.,„__ _ *Erie * auavl I _ _. - e tbGart Swans 4 _ Pad Gulch ___." J — -- � Gkk -%Wafe t Menthe Comer - - — nry D _ I _ -- Big II..... i ...__ _GaunN -del_ `_ _ d Iona I CD- ue I -- Larayette -- - 9\ and - -I p G}� Baghton m - - --♦LoullVlil! r}r'D __ Begdat Park 1 I -- Vi _ .-'- / _)Barr Lake n: ya Hand rsoland _'— �f''' Eastlake -*BranerGuji• H —_.— 6roomfleld e, ♦_ -'------• Hen rson____ ax ";ne v 1999 Dearme: Street A USA-`. ( 1' .. -lJ Iay // -- -- -- III. ECONOMIC BASE ANALYSIS FOR THE FOUR-COUNTY MARKET AREA A. Employment Growth Trends _ Employment trends are prime indicators of the economic growth of an area. Increases in employment generate growth for most sectors of the local economy and dictate the rate at which it will expand. This section looks at the region's various employment figures and projects their course over the next decade. The table below illustrates employment growth in the four-county market area, which includes Adams, Boulder, Larimer, and Weld Counties. Over a 31-year period, total employment jumped from 175,185 in 1970 to 690,898 in 2001 -- an annual average of 16,636 jobs. Between 1991 and 2001, the four-county area added an average 21,975 jobs on an annual basis. The number of jobs added annually has decreased slightly in recent years, reaching 21,511 jobs annually between 1996 and 2001. In 2000, the market area added 28,430 jobs,the largest increase of the 31-year period. Since 1970, the four-county market area has experienced growth in almost all employment sectors. The only significant exception has been the farming industry, which lost an average of 20 jobs annually between 1970 and 2001. In terms of growth magnitudes, the most significant contributor to the local economy has been the services industry, which averaged the addition of 5,689 new jobs per year during the 1970-2001 period. Other strong growth industries include the retail and manufacturing sectors, which added 2,940 and 1,888 jobs respectively on an average annual basis between 1970 and 2001. In the three-year 1998-2001 period, an average of 20,019 new jobs were generated annually in the four-county market area. Table III-2 shows the market area's employment growth by industry from 1970 to 2001. Fueling the four-county market area's employment growth is an increasingly diverse economic base. Table III-3 projects employment by industry for the market area from 2002 to 2012. As shown, the market area will continue to experience growth, albeit at a slower pace, with total employment averaging increases of 22,515 jobs annually. The retail and services sectors will lead the way averaging annual gains of 3,565 and 8,068 jobs respectively. The construction sector will continue to expand, averaging the addition of 3,356 new jobs per year. Due to the overall economic climate, both locally and nationally, employment growth in the four-county market area will be modest in 2002 and 2003, and then will stabilize at 2.8% per year for the 2004-2012 period. _ Within the four-county area, the northern counties of Larimer and Weld have better withstood the recent economic downturn and fallout from September 11th. The high-tech sector, prevalent particularly in Boulder County, has sustained substantial job losses. Over 60% of the projected job growth in the four-county area is earmarked for Weld and Larimer Counties, and the bulk of the job growth in the market area in the next one to three years is projected to occur in Larimer and Weld. PINNACLE FARMS 5 THKAssociates,Inc. TABLE III-1: Employment Trends in the Four-County Market Area, 1970-2001 Annual Change - Year Total Employment Numerical Percent 1970 175,185 1980 341,929 16,674 6.9% - 1981 349,828 7,899 2.3% 1982 358,352 8,524 2.4% 1983 374,025 15,673 4.4% 1984 398,740 24,715 6.6% 1985 404,701 5,961 1.5% 1986 406,994 2,293 0.6% - 1987 410,518 3,524 0.9% 1988 430,692 20,174 4.9% 1989 444,869 14,177 3.3% - 1990 456,727 11,858 2.7% 1991 471,150 14,423 3.2% 1992 487,911 16,761 3.6% - 1993 515,399 27,488 5.6% 1994 542,170 26,771 5.2% 1995 561,566 19,396 3.6% - 1996 583,341 21,775 3.9% 1997 606,586 23,245 4.0% 1998 630,842 24,256 4.0% - 1999 657,639 26,797 4.2% 2000 686,069 28,430 4.3% 2001 * 690,898 4,829 0.7% Annual Change 1970-2001 16,636 4.5/0 0 - 1991-2001 21,975 3.9% - 1996-2001 21,511 3.4% - 1998-2001 20,019 3.1% Based on preliminary data Note: The Four-County Market Area includes Boulder,Weld,Larimer,and Adams Counties Source: U.S.Dept.of Commerce,Bureau of Economic Analysis,and THK Associates,Inc. PINNACLE FARMS 6 THK Associates,Inc. I I I I I I I I I I I I I I I I I I 1 Total Employment in the Four County Market Area, I970-2001 700,000 1 `fff wii s`ii: rte. f 22='' _ 600,000J ` : ,,_ _; T --_ -'--- __. 2:=`2; i -.2,• , ;4`=L _ h22• ill - -- .t=f -- 500,000— ii! it; �t =f L :t2Z _ i f'f ' 2' ... 2 it it: Gtf :Zfi•' 22f�: 2qf` LYh' ,.ii. G.L`, r,1 •.iii• E.' `� -- f" 2,rf -- 2'f'` Rf' 2if1 si'3' §.1 400,000-�- ,ii Z? g` s%: x 2,, f?iia.: n a., s ffi: :: i;f s K iiii2 _ nR :::'s1`! it:�' i. '` wig: n iik int .0 . 2=\' fa iif2. f=``f. ₹\` gf`: 'i,.' fi:f ' .\ N.. :,..ii, iii;:• f`wf' ff IR. �, fii; fff ==2, Z� iff ifii. ,,,. 22,, 'iaf Ffi iL„ m: S2; :fi 5� v.. iif ;fi' giw .iA :i+. `ii tix au: i. fz Ei�, �:Y ffzi 2L $2, a f: xi iif ;iii „: — fxi -- — ff — .ff —c,,. „ :2;; — 3 '<i? ci zii i i 300.000 z� i;i ff:` fi: vff L.... ff 'f:ti. iii �``f .`t`.w. ��\ L., fff`� off' R2 ,':. 22•�i km _�` iif' f�i, �,,t iif ?zf fs Sib f„ 0`f� :i=. i 22 iiffi `f:2:, f 222 VI .,• 2fj ii,:. `!2' :i S\ iif >;.., ,.2 ffe ffi iii C" 2222 fiif t,. f22. i iii Zfr K: - iZi Ps -- -- - i:`,i.� .A,L .iff ii'f�� <ff -_ it — 'ii — : viii -b: ii az' at ?00,000-- ?' :?` t i2 'i23 i?ii �: f= ii2 fff \f- ii.Y: ii` iff• i IN: : ;: • fili 2 222 * :2£ iiii �iti,� CN .. �� i� ti" k`r ifii i. al :2ii. fi.: .,i ki iif �-. frt i „=2 M: i2a x� 2 {"2 ` „2' :iii:. •"t ;,",_, , iii`. �`f �c •fa., :i;f: i . i`2� .i. `i2f :.ii;: :, 2`�` sfi•ifY z p4:f ' ri �f iif i;, sr "' `22 �2f fig aid z�is :i•w- ti U,. Reza f2= .f,.. f f, ii�• 2 :;:� Wi :iii _� �?';' i` ,=}f: f :`. ,� `ii :i 2,`• Kf 1,,,..,,,,I. ' _. r i,. b — '.r ' „2.: p iii gv-: n 3i, ff•: - — sffi' - _ g,'r-'. : -- ,.� a;ii ,i .�. � 2 fir - �O�.OVO- fff iiff2. 22i� ,.L it. 2"' Ci� ��• if`` 2ff' :4:- ;*; r A iti.; `.` ,iif v ..2.\': off 1..= i2fff Z :fffi.' iA;, f`ti``=: � qff .� ,!2� fs i4`2:::4 :i;,li. i1,41 fii• kg 22 `,i ` 2gf ,k NI ,L= z.,• ..i ii 2`�. 21 ,2`i . ,. 'i₹fff ii: 'zfk' 2:ii, f '`'!L ZTi :f {i: 't.. i digs 2 f",, �`` f ;i:�,., fY� ir. A.- H. � i.,,. .� \iff �f`2 f`i � #C fff iiiii i � �.2. ifi tii 4 .,, u s.a ir, .•x 2i2f' @ :VI • i fxxf ., z= .� 0ii. ..,,:.,,z ,T: i 4; L2 ti 1 gfii :fa n a• IR igi g c' l,'' r2 s At f !,. i=i fif it afi ,2, i fii Vii??. iq iif ''i ti f s: At. die : . .. 5i a i?. i ; vif z i iif t at ;fr;: gi;; r'` ta,: s: c l i4. 222 �> it i� rR, i 1["'a"tt$.. `i" i:'W''A00;iM 001 . 0i:: :`' is:}}}} si 2!a,}' 4..tzi::>x i u wig •E3: r f ^ i (� .. .a.,,.,....�.}.�... +iii.... ....... ' if3�....... .......:.:.. ......:.. ',.:... ......... •.....,a. ,..,i,i2i ..:.. ...:... ;Ttitt- -.....,.. ..,i,'".'•:i.• ia ':}}', i.zikf�if�•. .rrlu! }}',nii�•??Y:.L2` * 1970 198( 1981 1982 19831 1984 1985 19861 19871 1988 1989 1990 1991 1992 1993 1994 1995 I 99 1997 1998 1999 2000 2001 •Based Olt Iirc I IIIU ii8 ry di to I I I I I I I I I I I I I I I I I I I TABLE III-2: Employment By Industry in the Four County Market Area,1970-20O1 Industry 1970 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 Wage&Salary (By Place of Work) 163,874 330,507 338,544 347,206 362,135 387,466 394,013 395,955 399,635 419,094 433,697 445,474 461,297 Ag,5,F,F 1,073 2,729 2,880 3,247 3,696 4,017 4,377 4,613 4,909 5,147 5,093 5,369 5,651 Mining 917 2,741 3,333 3,445 3,586 3,725 3,825 3,083 3,589 3,546 3,401 3,604 3,861 Construction 10,594 23,219 22,262 22,058 24,083 27,660 26,916 26,089 23,242 22,101 22,733 23,104 24,566 Manufacturing 25,822 59,812 62,313 63,805 66,084 70,339 66,445 64,575 64,830 61,628 64,169 65,316 66,923 T&U• 5,143 13,035 13,695 15,601 15,496 16,257 15,897 15,926 16,958 18,247 19,881 20,683 22,134 Wholesale Trade 3,916 13,404 14,278 14,177 13,426 14,530 16,167 15,612 15,774 16,280 17,622 19,856 21,349 Retail Trade 27,425 57,915 59,149 60,593 63,678 68,874 71,680 71,494 73,017 74,792 76,811 78,256 81,371 FIRE•• 15,579 28,683 28,862 29,042 29,532 31,062 31,490 31,837 30,800 30,949 30,123 29,005 28,201 Services 29,412 65,568 68,676 73,264 80,082 86,419 90,689 95,238 98,132 115,600 120,316 125,315 130,578 Government 43,993 63,401 63,096 61,974 62,472 64,583 66,527 67,488 68,384 70,804 73,548 74,966 76,663 Farm 11,311 11,422 11,284 11,146 11,890 11,274 10,688 11,039 10,883 11,598 11,172 11,253 9,853 Total Employment 175,185 341,929 349,828 358,352 374,025 398,740 404,701 406,994 410,518 430,692 444,869 456,727 471,150 Average Annual Change 1970-2001 1991-2001 1996-2001 1998-2001 Industry 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 (30 Year) (10 Year) (5 Year) (3 Year) Wage&Salary (By Place of Work) 478,075 504,916 531,623 552,273 573,342 595,741 620,201 646,962 675,273 680,215 16,656 21,892 21,375 20,005 Ag,S,F,F 5,688 6,500 7,414 7,216 7,668 8,272 8,398 9,227 9,500 9,453 270 380 357 352 Mining 3,725 3,930 4,132 3,651 3,142 3,410 3,408 3,414 3,404 3,400 80 -46 52 -3 Construction 28,685 31,959 36,455 36,860 40,023 42,876 47,539 52,764 57,650 58,010 1,530 3,344 3,597 3,490 Manufacturing 69,564 71,182 73,282 75,461 78,308 81,022 83,169 82,962 84,862 84,350 1,888 1,743 1,208 394 T&U• 23,507 25,018 26,248 26,454 27,047 27,444 29,217 31,758 33,613 32,725 890 1,059 1,136 1,169 Wholesale Trade 22,198 23,052 24,055 25,618 27,068 28,229 28,784 30,033 31,108 31,970 905 1,062 980 1,062 Retail Trade 84,849 89,653 98,348 103,520 106,368 108,382 109,518 113,026 117,013 118,550 2,940 3,718 2,436 3,011 I FIRE•• 27,884 30,302 28,963 34,176 36,740 40,144 43,450 46,924 50,274 50,875 1,139 2,267 2,827 2,475 Services 132,921 143,644 153,718 160,298 167,618 175,762 184,946 193,887 203,887 205,775 5,689 7,520 7,631 6,943 • Government 79,054 79,676 79,008 79,019 79,360 80,200 81,772 82,967 83,962 85,107 1,326 844 1,149 1,112 Farm 9,836 10,483 10,547 9,293 9,999 10,845 10,641 10,677 10,796 10,683 -20 83 137 14 Total Employment 487,911 515,399 542,170 561,566 583,341 606,586 630,842 657,639 686,069 690,898 16,636 21,975 21,511 20,019 • Transportation&Utilities •• Finance,Insurance,Real Estate Source: Colorado Dept.of Labor&Employment,and THK Associates,Inc. I I I I I I I I I I I I I I I I I I I Employment Trends By Industry in the Four County Market Area, 1970-2001 8,000 , I 7,000 - 6,000 • 5,000 4,000 ' 3,000 - d 2,000 :: 1 � li gip I _ I_, i i H i i , i i i i u_ .c 2hi ` 06 F FT. �' Z C IL U _ Q o ~ 'gyp LL co N C = co 0 co 13 1970-2001 ■1991-2001 O 1996-2001 O 1998-2001 TABLE III-3: Projected Employment in the Four County Market Area,2002-2012 Annual Annual Annual - Rate of Rate of Rate of Change Change Change Industry 2002 2003 2004-2012 2002 2003 2004 2005 total Mon I-arm _ (By Place of Work) 1.5% 2.3% 3.1% 604,460 618,725 638,228 658,392 Ag,S,F,F 1.6% 2.4% 3.2% 9,604 9,835 10,149 10,474 Mining 0.2% 0.3% 0.4% 3,407 3,417 3,431 3,444 - Construction 2.4% 3.5% 4.7% 59,373 61,466 64,355 67,380 Manufacturing 0.9% 1.3% 1.7% 85,067 86,152 87,616 89,106 T&U" 1.8% 2.6% 3.5% 33,298 34,172 35,368 36,606 Wholesale Trade 1.3% 1.9% 2.5% 32,370 32,977 33,801 34,646 - Retail Trade 1.4% 2.0% 2.7% 120,150 122,583 125,893 129,292 FIRE** 2.1% 3.1% 4.1% 51,918 53,514 55,709 57,993 Services 1.7% 2.6% 3.4% 209,273 214,610 221,906 229,451 Government 0.5% 0.8% 1.0% 85,533 86,174 87,036 87,906 Farm 0.4% 0.5% 0.7% 10,720 10,777 10,852 10,928 Total Employment 1.4% 2.1% 2.8% 700,713 715,676 736,116 757,226 Average Annual Industry 2006 2007 2008 2009 2010 2011 2012 Change Wage&Salary _ (By Place of Work) 679,240 700,796 723,087 746,139 769,979 794,635 820,138 21,568 Ag,S,F,F 10,809 11,155 11,512 11,881 12,261 12,653 13,058 345 Mining 3,458 3,472 3,486 3,500 3,514 3,528 3,542 14 Construction 70,547 73,862 77,334 80,968 84,774 88,758 92,930 3,356 Manufacturing 90,620 92,161 93,728 95,321 96,942 98,590 100,266 1,520 T&U• 37,887 39,213 40,585 42,006 43,476 44,998 46,573 1,327 Wholesale Trade 35,512 36,400 37,310 38,243 39,199 40,179 41,183 881 Retail Trade 132,783 136,368 140,050 143,832 147,715 151,703 155,799 3,565 FIRE** 60,370 62,845 65,422 68,104 70,897 73,803 76,829 2,491 Services 237,253 245,319 253,660 262,284 271,202 280,423 289,957 8,068 Government 88,785 89,673 90,570 91,475 92,390 93,314 94,247 871 Farm 11,005 11,082 11,159 11,237 11,316 11,395 11,475 75 Total Employment 779,029 801,551 824,816 848,852 873,685 899,345 925,860 22,515 * Transportation&Utilities `• Finance,Insurance,Real Estate Source:THK Associates,Inc. PINNACLE FARMS 10 THKAccnrintnc Ines I I I i I I i I I I I I I I I I I I I I Population & Ilousehold Growth in the Four County Market Area, 1970-2002 30,000 25,000 20,000-0 . . . . 15,000- 10,000 5,000I 1970-2002 1980-2002 1990-2002 2002-2012i ■Annual Average 1lousehold Growth 8,950 3,290 10,810 10,040 DAnnual Average Population Growth 220,760 20640 29,200 24,810 * Projected I I I I I I I I I I I I i I I I I I I TABLE III-5: Estimates of the Population and Households for Dacono&Surrounding Communities in the Four County Market Area, 1970-2002 Frederick Firestone Dacono Longmont Fort Lupton Brighton Year Population Households Population Households Population Households Population Households Population Households Population Households 1980 855 265 1,204 354 2,321 795 42,942 15,483 4,251 1,392 12,773 4,204 1990 988 339 1,358 420 2,228 841 51,555 19,570 5,159 1,693 14,203 4,773 2000 2,467 852 1,908 621 3,015 1,087 71,093 26,667 6,787 2,099 20,905 6,718 2001 3,554 1,232 2,926 954 3,156 1,139 73,611 27,957 7,040 2,180 22,380 7,210 2002 4,365 1,515 3,845 1,255 3,295 1,190 76,930 29,262 7,090 2,200 24,030 7,760 (1980-2002): Numerical 160 60 120 40 40 20 1,540 630 130 40 510 160 Percent 7.7% 8.2% 5.4% 5.9% 1.6% 1.9% 2.7% 2.9% 2.4% 2.1% 2.9% 2.8% %of Four County Area 0.8% 0.7% 0.6% 0.5% 0.2% 0.2% 7.5% 7.6% 0.6% 0.5% 2.5% 1.9% (1990-2002): Numerical 280 100 210 70 90 30 2,110 810 160 40 820 250 Percent 13.2% 13.3% 9.1% 9.6% 3.3% 2.9% 3.4% 3.4% 2.7% 2.2% 4.5% 4.1% %of Four County Area 1.0% 0.9% 0.7% 0.6% 0.3% 0.3% 7.2% 7.5% 0.5% 0.4% 2.8% 2.3% Source:U.S.Dept of Commerce,Bureau of Census,and THK Associates,Inc. C. Residential Construction Trends in the Four-County Market Area Residential housing construction by type and tenure is displayed in Table III-6. As shown, single-family and duplex construction has dominated historical permit activity in the market _ area, ranging from 76% of permits issued over the last 30 years to 80% of permits issued since 1992. Rental multi-family unit construction activity has increased in recent years, however, accounting for 25% of the permits authorized in 2001. Through April 2002, 5,059 residential building permits were issued in the market area; of those, 80% were for single-family and duplex units. Weld and Larimer have accounted for almost half the permit activity since 1999. Tables III-6A through III-6F track the historical permit activity in Dacono, Frederick, Firestone, Longmont, Fort Lupton, and Brighton. Dacono has shown significant increases in permit activity since 1996. An average of 42 permits were issued annually in Dacono between 1997 and 2002. All of the other communities profiled have also experienced dramatic increases in permit activity in recent years. PINNACLE FARMS 14 THKAssociates,Inc. Multi-Family Four County Adams County Boulder County Weld County Larimer County Total Percent Percent Percent Percent - Year Permits of Total Permits of Total Permits of Total Permits of Total Permits 1970 1,057 36.6% 981 33.9% 484 16.7% 368 12.7% 2,890 1971 2,553 35.3% 2,478 34.3% 1,428 19.8% 771 10.7% 7.230 1972 3,523 49.5% 1,523 21.4% 78 1.1% 1.995 28.0% 7.119 - 1973 2,044 38.2% 1,352 25.3% 420 7.9% 1,532 28.6% 5,348 1974 328 24.1% 352 25.9% 424 31.2% 257 18.9% 1,361 1975 19 6.6% 29 10.0% 94 32.4% 148 51.0% 290 1976 24 2.5% 386 40.0% 328 34.0% 227 23.5% 965 1977 86 4.7% 740 40.0% 359 19.4% 664 35.9% 1,849 1978 250 13.1% 905 47.6% 319 16.8% 129 22.5% 1.903 1979 625 26.3% 462 19.5% 295 12.4% 990 41.7% 2,372 1980 429 28.1% 579 37.9% 86 5.6% 434 28.4% 1,528 1981 412 34.3% 458 38.2% 58 4.8% 272 22.7% 1,200 1982 632 36.0% 637 36.3% 204 11.6% 281 16.0% 1,754 1983 1,155 35.3% 1,522 46.5% 116 3.5% 482 14.7% 3.275 - 1984 1.993 47.4% 1.051 25.0% 107 2.5% 1.057 25.1% 4,208 1985 1,231 41.4% 317 10.7% 417 14.0% 1,009 33.9% 2.974 1986 1,164 51.7% 505 22.4% 344 15.3% 240 10.7% 2,253 1987 152 13.5% 482 42.9% 143 12.7% 347 30.9% 1.124 - ' 1988 35 10.4% 34 10.1% 26 7.7% 241 71.7% 336 1989 96 38.7% 76 30.6% • 24 9.7% - 52 21.0% 248 1990 0 0.0% 449 64.8% 25 3.6% 219 31.6% 693 1991 60 16.0% 4 1.1% 34 9.1% 277 73.9% 375 - 1992 3 0.6% 353 67.4% 12 2.3% 156 29.8% 524 1993 269 35.9% 82 10.9% 97 12.9% 302 40.3% 750 1994 321 24.2% 360 27.1% 20 1.5% 628 47.3% 1.329 1995 567 26.5% 889 41.6% 82 3.8% 599 28.0% 2.137 - 1996 120 10.1% 775 64.9% 74 6.2% 225 18.8% 1,194 1997 821 38.8% 555 26.2% 262 12.4% 478 22.6% 2,116 1998 1,219 31.7% 1.817 47.3% 242 6.3% 563 14.7% 3,841 1999 357 21.3% 221 13.2% 154 9.2% 948 56.4% 1,680 - 2000 3,257 62.2% 806 15.4% 399 7.6% 776 14.8% 5,238 2001 1,855 42.2% 1,354 30.8% 317 7.2% 870 19.8% 4.396 2002 * 421 43.4% 237 24.4% 158 16.3% 154 15.9% 970 Thirty Year Average • 1972-2001 768 35.8% 636 29.6% 185 8.6% 557 25.9% 2,146 — Ten Year Average 1992-2001 879 37.9% 721 31.1% 166 7.1% 555 23.9% 2.321 Five Year Average — 1997-2001 1,502 43.5% 951 27.5% 275 8.0% 727 21.0% 3454 Three Year Average 1999-2001 1,823 48.3% 794 21.0% 290 7.7% 865 22.9% 3.771 PINNACLE FARMS 16 THKAssociates,Inc. Total Adams Coun Four County ry Boulder County Weld County Larimer County Total Percent Percent Percent Percent - Year Permits of Total Permits of Total Permits of Total Permits of Total Permits 1970 2,581 34.8% 2,282 30.7% 1,240 16.7% 1,319 17.8% 7,422 1971 4349 32.1% 4,571 33.7% 2,230 16.4% 2,409 17.8% 13,559 - 1972 5,631 37.7% 4,202 28.1% 2,076 13.9% 3,021 20.2% 14930 1973 4,796 37.6% 3,322 26.0% 1,410 11.0% 3,235 25.304 12,763 1974 1,614 26.5% 1,694 27.8% 1,314 21.5% 1.479 242% 6.101 1975 1,167 22.8% 1,548 30.3% 1,000 19.6% 1,393 27.3% 5,108 1976 1,456 19.0% 2,542 33.2% 1,241 16.2% 2,414 31.5% 7.653 1977 2,839 24.2% 3,693 31.5% 1,625 13.9% 3,552 30.3% 11.709 1978 3,326 28.9% 3,275 28.4% 1,751 15.2% 3,176 27.6% 11.528 1979 3,120 28.7% 2,636 24.2% 1,183 10.9% 3,948 36.3% 10,887 ,_ 1980 2,203 35.9% 1,673 27.3% 515 8.4% 1,743 28.4% 6,134 1981 1,649 37.6% 1,292 29.5% 268 6.1% 1,172 26.8% 4,381 1982 2,132 37.1% 2,095 36.5% 446 7.8% 1,073 18.7% 5,746 1983 4,005 35.7% 4,259 38.0% 622 5.5% 2,329 20.8% 11,215 1984 4,611 38.5% 3,926 32.8% 549 4.6% 2,885 24.1% 11,971 1985 3,023 35.9% 1.867 22.2% 896 10.6% 2,642 31.3% 8,428 1986 2,986 38.6% 2.125 27.5% 674 8.7% 1,949 25.2% 7,734 1987 900 19.7% 1,706 37.3% 446 9.8% 1,521 33.3% 4,573 1988 399 13.6% 951 32.5% 292 10.0% 1,284 43.9% 2.926 1989 390 15.0% 938 36.0% 253 9.7% 1,023 39.3% 2.604 1990 310 9.7% 1.395 43.6% 256 8.0% 1,236 38.7% 3.197 1991 663 16.5% 1,491 37.0% 330 8.2% 1,543 38.3% 4.027 - 1992 1,150 18.3% 2.701 42.9% 515 8.2% 1,928 30.6% 6.294 1993 1,829 22.9% 2,580 32.4% 945 11.9% 2,618 32.8% 7,972 1994 2,521 29.6% 2,474 29.1% 523 6.1% 2,989 35.1% 8,507 1995 2,680 29.6% 2.977 32.9% 710 7.8% 2,694 29.7% 9.061 --. 1996 2,661 27.9% 2.589 27.2% 1,711 18.0% 2,570 27.0% 9.531 1997 3,634 31.8% 3,038 26.6% 1,984 17.4% 2,777 24.3% 11.433 1998 4,283 28.0% 4.702 30.8% 3,069 20.1% 3.222 21.1% 15.276 - 1999 3,730 26.9% 2.986 21.5% 3,557 25.7% 3,591 25.9% 13.864 2000 5,892 36.2% 2,476 15.2% 4.369 26.9% 3,524 21.7% 16.261 2001 6.133 35.2% 3.314 19.0% 4,321 24.8% 3,636 20.9% 17.404 2002 • 1,800 35.6% 786 15.5% 1,475 29.2% 998 19.7% 5,059 Thirty Year Average 2,724 30.4% 2,549 28.4% 1,295 14.4% 2,406 26.8% 8.974 1972-2001 - Ten Year Average 3,451 29.9% 2,984 25.8% 2,170 18.8% 2,955 25.6% 11.560 1992-2001 Five Year Average 4,734 31.9% 3,303 22.2% 3,460 23.3% 3,350 22.6% 14.848 1997-2001 Three Year Average 5,252 33.1% 2,925 18.5% 4,082 25.8% 3.584 22.6% 15.843 1999-2001 *2002 Permits through April Source: U.S. Department of Commerce,C-40 Reports and THK Associates,Inc. PINNACLE FARMS 17 THK e«...r,..,,, I..- — Table III-6A: HOUSING UNITS AUTHORIZED FOR THE CITY OF DACONO,1980-2002 Single Family and Percent Multi- Percent Percent - Year Duplex Total family Total Total Total 1980 0 0.0% 12 100.0% 12 100.0% - 1981 0 0.0% 8 100.0% 8 100.0% 1982 0 0.0% 0 0.0% 0 100.0% 1983 16 100.0% 0 0.0% 16 100.0% - 1984 0 0.0% 0 0.0% 0 100.0% 1985 1 100.0% 0 0.0% 1 100.0% 1986 3 100.0% 0 0.0% 3 100.0% - 1987 1 100.0% 0 0.0% 1 100.0% 1988 0 0.0% 0 0.0% 0 100.0% 1989 2 100.0% 0 0.0% 2 100.0% 1990 1 100.0% 0 0.0% 1 100.0% - 1991 0 0.0% 0 0.0% 0 100.0% 1992 0 0.0% 0 0.0% 0 100.0% 1993 0 0.0% 0 0.0% 0 100.0% - 1994 2 100.0% 0 0.0% 2 100.0% 1995 2 100.0% 0 0.0% 2 100.0% 1996 5 100.0% 0 0.0% 5 100.0% 1997 12 100.0% 0 0.0% 12 100.0% 1998 56 73.7% 20 26.3% 76 100.0% 1999 61 100.0% 0 0.0% 61 100.0% - 2000 24 60.0% 16 40.0% 40 100.0% 2001 21 100.0% 0 0.0% 21 100.0% 2002• 24 100.0% 0 0.0% 24 100.0% - Twenty Year Average 1982-2001 10 85.2% 2 14.8% 12 100.0% - Ten Year Average 1992-2001 18 83.6% 4 16.4% 22 100.0% - Five Year Average 1997-2001 35 82.9% 7 17.1% 42 100.0% Three Year Average - 1999-2001 35 86.9% 5 13.1% 41 100.0% - 2002 Permits through April Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 18 THK Associates,Inc. Table 1II.6B: HOUSING UNITS AUTHORIZED FOR THE TOWN OF FREDERICK,1980-2002 Single Family and Percent Multi- Percent Percent — Year Duplex Total family Total Total Total 1980 6 100.0% 0 0.0% 6 100.0% - 1981 2 100.0% 0 0.0% 2 100.0% 1982 11 100.0% 0 0.0% 11 100.0% 1983 7 22.6% 24 77.4% 31 100.0% - 1984 14 100.0% 0 0.0% 14 100.0% 1985 23 100.0% 0 0.0% 23 100.0% 1986 0 0.0% 0 0.0% 0 100.0% - 1987 0 0.0% 0 0.0% 0 100.0% 1988 4 100.0% 0 0.0% 4 100.0% 1989 0 0.0% 0 0.0% 0 100.0% 1990 2 100.0% 0 0.0% 2 100.0% - 1991 0 0.0% 0 0.0% 0 100.0% 1992 1 100.0% 0 0.0% 1 100.0% 1993 35 100.0% 0 0.0% 35 100.0%- 1994 61 100.0% 0 0.0% 61 100.0% 1995 53 100.0% 0 0.0% 53 100.0% 1996 62 100.0% 0 0.0% 62 100.0% - 1997 34 100.0% 0 0.0% 34 100.0% 1998 32 100.0% 0 0.0% 32 100.0% 1999 292 100.0% 0 0.0% 292 100.0% - 2000 413 100.0% 0 0.0% 413 100.0% 2001 317 100.0% 0 0.0% 317 100.0% 2002' 94 100.0% 0 0.0% 94 100.0% Twenty Year Average 1982-2001 68 98.3% 1 1.7% 69 100.0% — Ten Year Average 1992-2001 130 100.0% 0 0.0% 130 100.0% — Five Year Average 1997-2001 218 100.0% 0 0.0% 218 100.0% Three Year Average — 1999-2001 341 100.0% 0 0.0% 341 100.0% 2002 Permits through April Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 19 THK Associates,Inc. — Table III-6C HOUSING UNITS AUTHORIZED FOR THE TOWN OF FIRESTONE,1980-2002 - Single Family and Percent Multi- Percent Percent - Year Duplex Total family Total Total Total 1980 8 100.0% 0 0.0% 8 100.0% - 1981 2 100.0% 0 0.0% 2 100.0% 1982 6 46.2% 7 53.8% 13 100.0% 1983 5 100.0% 0 0.0% 5 100.0% •- 1984 6 100.0% 0 0.0% 6 100.0% 1985 12 100.0% 0 0.0% 12 100.0% 1986 13 100.0% 0 0.0% 13 100.0% 1987 0 0.0% 0 0.0% 0 100.0% - 1988 0 0.0% 0 0.0% 0 100.0% 1989 1 100.0% 0 0.0% 1 100.0% 1990 0 0.0% 0 0.0% 0 100.0% - 1991 0 0.0% 0 0.0% 0 100.0% 1992 6 100.0% 0 0.0% 6 100.0% 1993 9 100.0% 0 0.0% 9 100.0% - 1994 3 100.0% 0 . , 0.0% 3 100.0% 1995 18 100.0% 0 0.0% 18 100.0% 1996 3 100.0% 0 0.0% 3 100.0% 1997 11 100.0% 0 0.0% 11 100.0% 1998 24 100.0% 0 0.0% 24 100.0% 1999 178 100.0% 0 0.0% 178 100.0% 2000 361 100.0% 0 0.0% 361 100.0% - 2001 395 100.0% 0 0.0% 395 100.0% 2002• 136 100.0% 0 0.0% 136 100.0% - Twenty Year Average 1982-2001 53 99.3% 0 0.7% 53 100.0% - Ten Year Average 1992-2001 101 100.0% 0 0.0% 101 100.0% Five Year Average 1997-2001 194 100.0% 0 0.0% 194 100.0% Three Year Average - 1999-2001 311 100.0% 0 0.0% 311 100.0% - *2002 Permits through April Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 20 THK Associates,Inc. - Table III-6D: HOUSING UNITS AUTHORIZED FOR THE CITY OF LONGM0NT,1980-2002 - Single Family and Percent Multi- Percent Percent - Year Duplex Total family Total Total Total 1980 211 78.1% 59 21.9% 270 100.0% - 1981 150 86.2% 24 13.8% 174 100.0% 1982 319 81.8% 71 18.2% 390 100.0% 1983 637 78.9% 170 21.1% 807 100.0% •- 1984 523 56.6% 401 43.4% 924 100.0% 1985 349 74.1% 122 25.9% 471 100.0% 1986 340 53.2% 299 46.8% 639 100.0% 1987 186 45.6% 222 54.4% 408 100.0% - 1988 103 100.0% 0 0.0% 103 100.0% 1989 92 56.1% 72 43.9% 164 100.0% 1990 75 100.0% 0 0.0% 75 100.0% - 1991 157 100.0% 0 0.0% 157 100.0% 1992 404 96.7% 14 3.3% 418 100.0% 1993 451 98.3% 8 1.7% 459 100.0% 1994 440 86.4% 69 13.6% 509 100.0% 1995 477 55.0% 390 45.0% 867 100.0% 1996 578 93.8% 38 6.2% 616 100.0% - 1997 988 73.2% 361 26.8% 1,349 100.0% 1998 986 62.1% 601 37.9% 1,587 100.0% 1999 976 80.8% 232 19.2% 1,208 100.0% 2000 1,326 90.5% 139 9.5% 1,465 100.0% 2001 979 59.9% 655 40.1% 1,634 100.0% 2002• 279 83.3% 56 16.7% 335 100.0% - Twenty Year Average 1982-2001 519 72.9% 193 27.1% 713 100.0% - Ten Year Average 1992-2001 761 75.2% 251 24.8% 1,011 100.0% Five Year Average - 1997-2001 1,051 72.6% 398 27A% 1,449 100.0% Three Year Average - 1999-2001 1,094 76.2% 342 23.8% 1,436 100.0% - "2002 Permits through April Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 21 THK Associates,Inc. - Table III.6E: HOUSING UNITS AUTHORIZED FOR THE CITY OF FORT LUPTON,1980-2002 Single Family and Percent Multi- Percent Percent - Year Duplex Total family Total Total Total 1980 13 100.0% 0 0.0% 13 100.0% - 1981 5 62.5% 3 37.5% 8 100.0% 1982 21 17.5% 99 82.5% 120 100.0% 1983 25 100.0% 0 0.0% 25 100.0% 1984 46 100.0% 0 0.0% 46 100.0% - 1985 70 100.0% 0 0.0% 70 100.0% 1986 36 100.0% 0 0.0% 36 100.0% 1987 18 100.0% 0 0.0% 18 100.0% - 1988 3 100.0% 0 0.0% 3 100.0% 1989 0 0.0% 0 0.0% 0 100.0% 1990 0 0.0% 0 0.0% 0 100.0% - 1991 0 0.0% 0 0.0% 0 100.0% 1992 11 100.0% 0 0.0% 11 100.0% 1993 8 100.0% 0 0.0% 8 100.0% _ 1994 42 100.0% 0 0.0% 42 100.0% 1995 41 100.0% 0 0.0% 41 100.0% 1996 48 100.0% 0 0.0% 48 100.0% 1997 82 100.0% 0 0.0% 82 100.0% - 1998 70 100.0% 0 0.0% 70 100.0% 1999 132 100.0% 0 0.0% 132 100.0% 2000 92 100.0% 0 0.0% 92 100.0% - 2001 20 100.0% 0 0.0% 20 100.0% 2002• 22 100.0% 0 0.0% 22 100.0% - Twenty-one Year Average 1980-2001 36 88.5% 5 11.5% 40 100.0% Ten Year Average 1991-2001 50 100.0% 0 0.0% 50 100.0% - Five Year Average 1996-2001 74 100.0% 0 0.0% 74 100.0% Three Year Average - 1998-2001 79 100.0% 0 0.0% 79 100.0% *2002 Permits through April Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 22 THK Associates,Inc. - Table III-6F: HOUSING UNITS AUTHORIZED FOR THE CITY OF BRIGHTON,1980-2002 - Single Family and Percent Multi- Percent Percent - Year Duplex Total family Total Total Total 1980 88 73.3% 32 26.7% 120 100.0% 1981 31 43.7% 40 56.3% 71 100.0% 1982 13 100.0% 0 0.0% 13 100.0% 1983 29 70.7% 12 29.3% 41 100.0% 1984 53 93.0% 4 7.0% 57 100.0% - 1985 64 76.2% 20 23.8% 84 100.0% 1986 65 100.0% 0 0.0% 65 100.0% 1987 45 100.0% 0 0.0% 45 100.0% - 1988 10 71.4% 4 28.6% 14 100.0% 1989 2 4.2% 46 95.8% 48 100.0% 1990 4 100.0% 0 0.0% 4 100.0% - 1991 10 20.0% 40 80.0% 50 100.0% 1992 64 100.0% 0 0.0% 64 100.0% 1993 48 100.0% 0 0.0% 48 100.0% 1994 92 100.0% 0 0.0% 92 100.0% 1995 159 100.0% 0 0.0% 159 100.0% 1996 198 100.0% 0 0.0% 198 100.0% 1997 186 100.0% 0 0.0% 186 100.0% - 1998 148 48.4% 158 51.6% 306 100.0% 1999 732 98.8% 9 1.2% 741 100.0% 2000 478 94.5% 28 5.5% 506 100.0% - 2001 571 100.0% 0 0.0% 571 100.0% 2002' 233 100.0% 0 0.0% 233 100.0% - Twenty-one Year Average 1980-2001 140 88.7% 18 11.3% 158 100.0% - Ten Year Average 1991-2001 244 92.0% 21 8.0% 266 100.0% - Five Year Average 1996-2001 386 92.2% 33 7.8% 418 100.0% Three Year Average 1998-2001 482 90.8% 49 9.2% 531 100.0% .2002 Permits through April - Source:U.S.Department of Commerce,C-40 Reports and THK Associates,Inc PINNACLE FARMS 23 THK Associates,Inc. D. Population and Household Projections for the Four-County Market Area The employment participation rate, typically expressed as a decimal, has been increasing steadily during the past two to three decades. A rising employment participation rate is a good indicator of improving conditions in the regional economy. First, a large number of people are employed in the work force, which has a corresponding effect on unemployment levels. Secondly, a larger number of workers in a low wage market provide an ample labor supply for expanding firms or new firms relocating to the area. Finally, more workers earning salaries will boost the area's volume of disposable income available for new retail, housing and related expenditures. Population, household, and employment data for the four-county market area are compared in Table III-7. In 1970, the population of the market area was 494,400 and resident employment was 175,185 for an employment participation rate of .35. By 1980, the market area's resident employment had increased to 341,929 with a population of 704,750 for an employment participation rate of.49. In Table III-7,the population growth of the four- county market area is projected based on the anticipated employment growth. With a projected January 1, 2012 resident employment of 925,860, the estimated 2012 population for the market area will be 1,406,850 with a projected employment participation rate of .66. The four-county population is projected to grow by 24,810 persons per year through 2012. Table III-7 also shows the projected trends in new household formations for the four-county market area. Historically, household size has been declining due to an increased divorce rate, delayed marriages, and the ever-larger population segment of single-parent households who formed the bulk of new household formations during the last decade. More recently, the decline in household size has been the result of smaller families (fewer children). The _ population per household in the four-county market area declined from 3.25 in 1970 to 2.74 in 1980; single households were among the most rapidly growing population segments. The 2002 household averages 2.63 members. During the next decade, household size should continue to decline but at a slower rate. The divorce rate now appears to be leveling off and the first wave of the "baby boom" generation will be reaching the traditional retirement age of 65. New household formations in the four- - county market area are projected to grow by an average of 10,040 annually during the next decade, with the average household size declining to 2.59. Population in group quarters,e.g., institutions, dormitories, etc., is expected to increase modestly during the decade to approximately 25,100. PINNACLE FARMS 24 THKAssociates,Inc. TABLE III-7: Projected Population and Households in the Four County Market Area,2002-2012 Employment Annual Population Population Population Annual Total Participation January 1, Population in Group In Per Household - Year Employment Ratio Population Change Quarters Households Household Households Change 1970 175,185 0.3543 494,400 21,353 473,047 3.2530 145,420 1980 341,929 0.4852 704,750 21,040 21,388 683,362 2.7391 249,480 10,410 1990 456,727 0.5650 808,340 10,360 22,051 786,289 2.6026 302,120 5,260 - 2000 686,069 0.6308 1,087,575 27,920 24,024 1,063,551 2.6375 403,247 10,110 2002 700,710 0.6047 1,158,774 35,600 24,120 1,134,654 2.6337 431,854 14,304 2003 715,680 0.6098 1,173,560 14,786 24,217 1,149,343 2.6299 437,030 5,176 2004 736,120 0.6150 1,196,900 23,340 24,313 1,172,587 2.6261 446,510 9,480 2005 757,230 0.6203 1,220,850 23,950 24,411 1,196,439 2.6223 456,250 9,740 2006 779,030 0.6255 1,245,410 24,560 24,508 1,220,902 2.6185 466,250 10,000 2007 801,550 0.6308 1,270,610 25,200 24,606 1,246,004 2.6148 476,530 10,280 - 2008 824,820 0.6362 1,296,480 25,870 24,705 1,271,775 2.6110 487,080 10,550 2009 848,850 0.6416 1,323,000 26,520 24,804 1,298,196 2.6072 497,920 10,840 2010 873,690 0.6471 1,350,240 27,240 24,903 1,325,337 2.6035 509,060 11,140 2011 899,340 0.6526 1,378,170 27,930 25,002 1,353,168 2.5997 520,500 11,440 2012 925,860 0.6581 1,406,850 28,680 25,102 1,381,748 2.5960 532,260 11,760 - Average Annual Change (2002-2012) - Numerical: 22,520 24,810 100 24,710 10,040 Percent: 2.8% 2.0% 0.4% 2.0% 2.1% - Source:Dept of Commerce,Bureau of the Census and THK Associates,Inc. PINNACLE FARMS 25 THK Associates,Inc. E. Growth and Development Trends in the Pinnacle Farms Primary Trade Area In the analysis to determine demand for real estate development, it is necessary to identify the primary area in which the subject site typically will compete. The trade area is a function of population density, natural barriers, accessibility of the site,and the location of competitive projects. As shown on the following map, the Pinnacle Farms trade area extends north and south along Interstate 25 and east and west along Highway 52. It is predominantly this market environment in which the Pinnacle Farms site will compete for home buyers. The historical growth pattern in the trade area has shown the following characteristics. In 1980, there were 126,360 people living in the trade area representing 17.9% of the four- - county population. Today 22.9% of the four-county population resides in the trade area, along with 22.4% of the region's households. The trade area has mirrored the strong growth of the four-county area. Since 1980, the Pinnacle Farms trade area has grown by 6,300 people and 2,450 households annually. Over the last 12 years, the trade area has increased by 8,930 people and 3,320 households annually. Currently, 264,980 persons in 96,720 households occupy the primary trade area as shown on the following table. Based on the historical activity in the area, the economic forecast for the four-county area and the number of residential projects planned, it is possible to project future population levels in the trade area. It is projected that the area will experience annual average population growth of 8,430 and household growth of 3,200 over the next decade. Thus, the population in the primary trade area will increase to 304,120 by 2007 and 349,250 by 2012. Table III-9 shows these projected growth trends. PINNACLE FARMS 26 THKAssociates,Inc. Pinnacle Farms Primary Trade Area -jr�P.1, • Pa�k I Hollowell CoI er 55 ° ® \ Rirdr vans ial- Ilrprhvn'V,�oHardman .af it ss i Campion 54 i *Eh) a Salle `'.f. 5z Ewen °Johnstown welry eude ��Mllllken ^' 0 o Clark o Pulliam ambert — Berthoud 50 Dent \ 'sa se• ° �i na eckham other 'ni Lurk Thompson R nvr Bunyan 0 aIt Si Vrein yy 'crest ',l `5 ," i3 alker Elevator f`u A' 3 •/bland ° o n dker o widcai -V •" •hen Lake Houston ce- 3 o °Highland . • Me'ad ,d`• - •Lyons , _. %� ad o orey M " PI- eviil s`• ;in"im J eP� Sr Labe 43 ee. Gawende anyorr Park •id Vasquez °^ oHYgle Kkkland r2 J • Loomill r P- '<a ° Sr I}om Owl: °Moor- o CP $. =ark And Golf our. Inn Ma en . Lgggmont� .. ._ Si 1.urn Creek 240 a amey -�� a,m nn lone one f o Ssum *Volt ar • odeha•eek °Pleasant View Rid— *Firestone L1Jiwot Event:Frederick - " rt r I- sO 6 e" j34 ,. -__-1 35_ Dac•ro rs Ft Lupton n zs .• Poo •Gootla g Pu n �$4 _ - © — — —-- _ •�� -•er Coo Clu• 25 •~'Lack Farms o We rifielda Erie tetanal ett - ,: g9 Leyner ° •� 32 rains Powers a ° OWk eW. 'enberg der — 8 (m .. Bould Jun Womb Comer Bi Dry Creek Pa ' 28 °Adana ' [a'' a / rr \ Pang.° at:- Ilk _ HI-Land Acre- ��, 74 — : .u.. '.n! . ou ye •Brighton , d-rata a pedor Barr Lake • a sr Id 15 fork Hie Golf Club`ak / is •Br Country o lu *Ea-tiake 1 Broomfiel . teal -nders r *Rainy \ •Lingslo Park orth•le n• I� - Eno Iwalla- Otago Haz-'fine eight Hyland Hills 6orc C• A° g no Q hom on �'• e Clay >2� ` DEN F o e Fire 1/2°T °Le en St Anthony Har:�t\No'a o-deral-.e19htja oitl"nC31"e---- ----WeJtminste u tell?P r IJ OOI 1 In n Tree Golf Courses WeJl e • —a OM aved aqua -o °A{vada Zu r •' 1 ' LIc Limy Par: . . ill Pa \- - °Moneta° •\ [Olivet° 7s ,.a a av 4 � _ `' c, i:'oucla'.. a.. ' n Mag 11.03— ' Scale 1:3OOOC ii V What-Rl i e ae Wed Jul 24 15:252002 F. >•e D-n e - 5Miles �•4 •Iden ea Edgew ter - i .1` t\ 6Ion-Pa • �_- •1 r P.rk Ac Nichols P 10 KM — I C 1999 . Sloe. Adas 'S: at. r1 - as� L ■i n Edgemont _ ss"I° I D_n,."! re.k r •,,,,,,,. Table 111-8: Population and Household Trends in the Four County Market Area and the Pinnacle Farms Primary Trade Area,1980-2002 Annual Average 1980-2002 1990-2002 — Four County Market Area 1980 1990 2000 2002 Numerical Percent Numerical Percent Population 704,750 808,340 1,087,575 1,158,774 20,637 2.3% 29,203 3.0% Households 249,480 302,120 403,247 431,854 8,290 2.5% 10,811 3.0% — Pinnacle Farms Primary Trade Area — Population 126,360 157,840 248,860 264,980 6,301 3.4% 8,928 4.4% Households 42,840 56,850 90,050 96,720 2,449 3.8% 3,323 4.5% Pinnacle Farms PTA as a percent of the Four County Market Area — Population 17.9% 19.5% 22.9% 22.9% 30.5% -- 30.6% -- Households 17.2% 18.8% 22.3% 22.4% 29.5% -- 30.7% -- - Source: U.S. Bureau of the Census and THK Associates,Inc. TABLE III-9:Projected Population and Household Trends in the — Four County Market Area and the Pinnacle Farms Primary Trade Area,2002-2012 Annual Average 2002-2007 2002-2012 — Four County Market Area 2002 2007 2012 Numerical Percent Numerical Percent Population 1,158,774 1,270,610 1,406,850 22,367 1.9% 24,808 2.0% Households 431,854 476,530 532,260 8,935 2.0% 10,041 2.1% Pinnacle Farms Primary Trade Area Population 264,980 304,210 349,250 7,846 2.8% 8,427 2.8% Households 96,720 111,580 128,730 2,972 2.9% 3,201 2.9% — Pinnacle Farms PTA as a percent of the Four County Market Area — Population 22.9% 23.9% 24.8% 35.1% -- 34.0% -- Households 22.4% 23.4% 24.2% 33.3% -- 31.9% -- — Source: U.S. Bureau of the Census and THK Associates,Inc. PINNACLE FARMS 28 THK Associates,Inc. 1 i i I i I I I I I I I I I I I I I I Population& Household Growth in the Pinnacle Farms Primary Trade Area 9,000--77 8,000— , ',,,/,',0.,:s4,41,1. :14:5e,if' „ , i 7,000 d 3ge g07- 01 6,000 / — • �/�� '• u••7a••n i,„:„. „.01, 0-,,,,5,000-/ _ i j• 4,000 y — ; y— %,„ — 3,000 y 2,000-- / 1,000- 44,4-4 : l'414 :40Pfel 0 / 1980-2002 1990-2002 2002-2012` DAnnual Average Household Growth 2,449 3,323 3,201 D Annual Average Population Growth 6,301 8,928 8,427 'Projected IV. RESIDENTIAL MARKET ANALYSIS A. Projected Residential Demand The potentials for new residential development are subject to a variety of pressures including interest rates; inflation; and social, political, and other economic influences. The first section of this report projected the overall growth in population and household formations, which will create the aggregate demand for new housing construction. Historical trends in new housing construction were also examined to show how past construction trends have coincided with population and demographic changes and economic conditions. 1. Projected Demand in the Four-County Market Area Based on the historical performance of the market area's housing market and on the projected growth in new household formations shown earlier in this report, the demand for new residential construction can be segmented by tenure and type of unit. This will allow the market potentials for specific types of residential construction to be examined. The key components of residential demand during the next decade will include new housing units to meet the demands of new population growth and household formations, construction to meet the demands of the existing households in the area looking to upgrade or downgrade into new ownership or rental units, and construction to replace units lost through demolition and conversion. Table IV-1 summarizes the net change in housing unit demand expected during the next decade in the four-county market area. THK projects new household formations will average 10,040 per year during the projection period 2002-2012. This will produce a demand for the construction of 10,640 dwelling units annually when adjusted for vacancies and demolitions. Single-family detached construction of 7,755 units annually during the next decade will account for approximately 73.0% of total construction in the market area. Townhome and condominium construction will average 990 units annually, or 9.0% of the total construction; rental apartment construction will average 1,640 units annually, or 15.0% of total construction; and mobile home construction will average 250 units annually,or 2.0%of total construction. PINNACLE FARMS 30 THK Associates,Inc. • TABLE IV-1: Projected Four County Market Area Residential Demand by Unit Type,2002-2012 Ownership Units Annual Housing Total Detached Attached Rental Annual Unit Owner- Single Single Mobile Multi- - Year Households Change Demand ship Family Family Homes family 2002 431,854 5,176 5384 4,556 3,925 502 128 828 2003 437,030 9,480 9,860 8,344 7,189 919 235 1,516 2004 446,510 9,740 10,131 8,572 7,386 945 242 1,558 - 2005 456,250 10,000 10,401 8,801 7,583 970 248 1,600 2006 466,250 10,280 10,692 9,048 7,796 997 255 1,644 2007 476,530 10,550 10,973 9,285 8,000 1,023 262 1,688 2008 487,080 10,840 11,275 9,541 8,220 1,051 269 1,734 2009 497,920 11,140 11,587 9,805 8,448 1,080 276 1,782 2010 509,060 11,440 11,899 10,069 8,675 1,110 284 1,830 2011 520,500 11,760 12,232 10,350 8,918 1,141 292 1,881 2012 532,260 12,090 12,575 10,641 9,168 1,173 300 1,934 ._ Average Annual Demand (2002-2012) 10,040 10,637 9,001 7,755 992 254 1,636 Source: THK Associates,Inc. Average Annual Demand by Unit Type 8,000 6,000Z 4,000%' 2,000-' dip_aV,I _ 0 ! Detached Attached Mobile Rental Multi- Single Family Single Family Homes Family •Unit Type 7,755 992 254 1,636 PINNACLE FARMS 31 THK Associates,Inc. 1 1 I I Demand by Product Type in the Pinnacle Farms Primary Trade Area, 2002-2012 404 Rental Multi-Family- 12% 95 Mobile Homes- 3% 320 Attached Single-Family 10% . . . 2,546 Detached Single Family 75% B. Residential Purchasing Capacity and Demand by Price Range for the Pinnacle Farms Primary Trade Area To better quantify the demand for new residential units in the primary trade area, THK breaks down the trade area's existing households by income range and then converts those income ranges to home purchasing capacity and monthly rental capacity. Home purchasing capacity is calculated using estimated monthly payments (principle, interest, taxes and insurance) based on a 30-year fixed rate mortgage with an 7.25% interest rate and a 20%down payment. In determining monthly rental capacity it's assumed - as available statistics indicate - that households that rent spend, on average, 25% of their gross income on housing. Households that own their homes typically allot 28%-32% of their income to mortgage payments. It should be noted that no allowances have been made to account for the greater purchasing capacity that may be derived from adjustable rate mortgages (ARMs) or other alternative financing mechanisms. For that reason,Table IV-3's home purchasing capacity estimates are likely conservative. The median household income in the Pinnacle Farms primary trade area is currently approximately $66,700. This suggests that the median household in the trade area can afford a $227,000 home. Approximately 24.0% of the trade area's households can afford a home priced between $200,000 and $300,000, and approximately 39.0% can afford a home priced over $300,000. A portion of the trade area's households, approximately 23.0%, can only afford a home priced under$135,000. In Table IV-4, purchasing/rental capacity is combined with projected residential demand by unit type in order to estimate demand by price range. As shown, approximately 22.0% of the demand for detached single-family homes will be for units priced under $160,000. Another 15.0%will be for homes priced between $160,000 and $200,000. Approximately two-thirds of the condominium/townhome demand will be for units priced under$200,000. PINNACLE FARMS 34 THK Associates,Inc. Table IV-3: Estimated Residential Purchasing and Rental Capacity--Pinnacle Farms Trade Area,2002 Estimated Monthly Percent of Home Payment Monthly Income Range Households Purchasing Capacity (PITT) Rental Capacity Under $15,000 6.0% Under $50,000 $330 Under $310 $15,000 - $19,999 3.6% $50,000 - $69,999 $400 $310 - $419 $20,000 - $24,999 4.4% $70,000 - $89,999 $530 5420 - $519 $25,000 - $29,999 5.0% $90,000 - $109,999 $660 $520 - $629 $30,000 - $34,999 4.1% $110,000 - $134,999 $810 $630 - $729 $35,000 - $39,999 4.9% $135,000 - $159,999 $980 $730 - $829 $40,000 - $49,999 9.1% $160,000 - $199,999 $1,190 $830 &Above $50,000 - $74,999 24.0% $200,000 - $299,999 $1,660 575,000 &Above 39.0% $300,000 &Above $2,480 Median $66,700 100.0% $227,200 Source: U.S.Dept.of Commerce,Bureau of the Census,and THK Associates,Inc. Table IV-4: Estimated Annual Average Residential Unit Demand By Price Range in the Pinnacle Farms Primary Trade Area Unit Type and Price/Rent Range Total Percent Detached Single Family Under $110,000 177 7.0% $110,000 - $134,999 179 7.1% $135,000 - $159,999 201 7.9% $160,000 - $199,999 384 15.1% $200,000 - $299,999 738 29.0% $300,000 + 866 34.0% $337,653 Total 2,546 100.0% Condominiums and Townhomes Under $110,000 29 9.0% $110,000 - $134,999 45 14.1% $135,000 - $159,999 48 14.9% $160,000 - $199,999 61 19.1% $200,000 + 137 43.0% Total 320 100.0% Source: U.S.Bureau of the Census and THK Associates,Inc. PINNACLE FARMS 35 THK Associates,Inc. Table IV-S: Characteristics of Detached Residential Projects in the Pinnacle Farms Trade Area Environs,2002 A. Projects by Number of Units Sold• B.Projects by Monthly Sales Average Number %of Total Number %of Total Units Sold of Projects Total Units Sold of Projects Total 0-9 67 66.3% 0-1.99 35 34.7% 10-19 13 12.9% 2-3.99 25 24.8% 20-29 7 6.9% 4-5.99 18 17.8% 30-39 7 6.9% 6-7.99 7 6.9% 40+ 7 6.9% 8-9.99 6 5.9% 10+ 10 9.9% TOTAL 101 100.0% TOTAL 101 100.0% C.Projects by Average Unit Price Number of %of Unit Price Range Projects Total Under 5125,000 1 1.0% 5125,000-5149,999 0 0.0% 5150,000-5199,999 16 15.8% 5200,000-$249,999 21 20.8% $250,000-$299,999 20 19.8% 5300,000-5349,999 11 10.9% 5350,000-$399,999 10 9.9% $400,000-$449,999 7 6.9% $450,000-$499,999 5 5.0% 5500,000+ 10 9.9% TOTAL 101 100.0% • 2002 sales through May Source:THK Associates,Inc. PINNACLE FARMS 37 THKAss0ciOtes,Inc. I 1 I I I I I I I I I I I I I I I I I AVG 2001 RECORDED NEW HOME SALES 2002 YTD 02 SALES SUB- SUBDIVISION SELLERIBUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG DIVISION PLATTE RIVER RANCH KB HOME BRIGHTON $1733 26 19 15 11 32 24 16 2 0 3 0 1 6 124 6 ROCKING HORSE FARMS ALLAOONAI GUS IOM HOMES BRIGHTON $3609 0 0 0 0 I 0 0 2 2 0 1 5 .0.5 CAHNSCONSTR BRIGHTON $3109 2 0 1 0 0 0 0 0 0 0 1 1 04 JEAKINSCONSTR BRIGHTON $3450 1 0 10 KISSELMAN CUSTOM HOMES BRIGHTON $3761 1 0 10 SAGE CREEK CONSTR BRIGHTON $4300 1 1 10 SIX BITS CONSTR BRIGHTON $3500 1 1 10 SONPOINTE HOMES BRIGHTON $3650 0 2 0 I.0 TUSCANY PROPERTIES LTC BRIGHTON $380.0 0 0 0 1 I 0 0 1 0 0 0 1 2 03 WESTRIDGECONSTR BRIGHTON $308.0 1 1 2 10 12 SCHWARTZ SUB MAVERICK HOMES BRIGHTON $162 9 0 2 0 1.0 0 SUGAR CREEK DR HORTON/MELCOY HOMES BRIGHTON $237 2 1 6 6 2 32 50 32 TODD CREEK FARMS SHEFFIELD HOMES BRIGHTON $442• 0 0 2 04 MERIDLAN HOMES BRIGHTON $4221 1 1 0 1 1 05 BEFUSCONSTR BRIGHTON $711.4 1 1 0 0 1 I 03 FULL SPECTRUM HOMES BRIGHTON $416.0 1 0 0 0 1 1 03 APOLLOBLDRS BRIGHTON $490.4 0 0 3 1 • 02 JEFFREY HOMES BRIGHTON $706 4 1 0 1 04 AMBASSADOR BLORS BRIGHTON $4695 0 0 02 ATHERTON HOMES BRIGHTON $4050 0 1A AUSTIN NOLLSCHDEVL BRIGHTON $529.9 0 0 0 0 0 1 I 02 BLUE CHIP HOMES BRIGHTON $4850 0 0 0 03 COPPER RIDGE CUSTOM HOMES BRIGHTON $4.4.0 I I 0 10 GABRIEL HOMES BRIGHTON $461.0 1 1 10 KNUDSON INC BRIGHTON $440.0 1 0 10 STAR HOMES BRIGHTON $3990 1 1 10 STRAUSS HOMES BRIGHTON $3600 1 0 10 SIERRA CUSTOM HOMES BRIGHTON $6322 1 0 0 0 0 1 0 1 2 04 US HOME BRIGHTON $516.0 1 1 1.0 MORRISON HOMES BRIGHTON $3739 2 2 2.0 II TWIN LAKES EST IC HOMEBUILDERS BRIGHTON $379 0 1 0 10 0 UNPLATTED SUBO BERNARD CUSTOM CONSTR BRIGHTON $425.0 1 0 10 0 YORK STREET.HAVEN ENGLE HOMES COLO BRIGHTON $282.1 10 7 Ii 1 10 12 5 7 B 7 4 11 37 83 37 'EM BAXTER FARM CBS HOMES ERIE $1,1250 I 1 10 1 CANYON CREEK JOHNSON COMMUNITIES ERIE $2563 6 5 0 0 35 18 13 11 11 5 5 15 47 103 47 COUNTRY MEADOWS FARM SHEFFIELD HOMES WILDFLOWER ERIE $509 0 1 I I0 1 ERIE VILLAGE BLM ENTERPRISES INC ERIE $267 5 1 0 10 HESSERCONSTR ERIE $4000 0 1 1 0 0 0 0 0 1 I 2 04 SOPRISDEVL ERIE $4744 0 1 0 0 0 0 1 0 03 V.OLSKI DWG 0EVL ERIE 33099 0 0 0 1 0 03 • I I I I I I I I I I I I I I I I I I I • • • AVG 2001 RECORDED NEW HOME SALES 2002 TED 0 SALES SUB- SUBDIVISION .SELLEILBUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FES MAR APR MAY SALE AVG DIVISION WONDERLAND CUSTOM BLDRS ERIE 1372.0 0 2 0 1 1 0 0 0 0 0 2 0.5 THORBURN CONSTR ERIE $417.0 2 20 BOULDERFLATWORK ERIE $3]60 0 0 0 0 0 1 02 FORRETCONSTR ERIE $458.0 I 10 JUNIPER CONSTR ERIE 5050 1 0 0 D 1 04 KELTIC CONSTR ERIE $460.0 1 1.0 PL BUMS ERIE $4757 0 1 0.5 RGMCONSTR ERIE $394.6 0 0 0 0 0 1 02 STERLING GENERAL CONTR ERIE $494.0 1 0 0 0 0 0 I 0.3 ZINS ERIE 53881 1 10 a KENOSHA FARM HUDSON CONSTR ERIE $375.0 1 0 1 07 SOPRIS DEW ERIE $6453 1 0 0 0 0 0 0 1 0 1 09 4 MEADOW SWEET FARM,ORCHARD GLEN e RYLAND ERIE $3856 € 1 2 2 2 2 5 29 RGMCONSTR ERIE $400.0 1 10 0 NORTHRIDGE BLUE CREEK CONSTR ERIE $430.0 1 10 DESIGN WOODWORKS ERIE $8150 1 10 SHEFFIELD HOMES NORTHRIDGE ERIE $4202 1 2 2 0 0 1 0 0 0 2 06 2 }Firestone BOOTH FARMS RICHMOND AM HOMES COLD FIRESTONE $2]66 3 2 a 4 0 2 I 2 2 2 7 FIRESTONE.OVERLOOK N9 MARQUIS HOMES FIRESTONE $210.5 1 0 0 0 0 0 1 03 0 GLOBE ' MARQUIS HOMES FIRESTONE $192 2 Y0 ADAM PARKER CONSTR FIRESTONE 51745 I 10 0 OAK MEADOWS COUNTRY MEADOW HOMES INC FIRESTONE $192 0 0 1 03 GARCIA FRANCISCO JR FIRESTONE 5202.9 0 1 05 Eli BELL CONST FIRESTONE $194 6 1 1 10 JJ BLOWS REMODELING FIRESTONE 5231.5 0 0 0 0 0 1 02 LIBERTY HOMES FIRESTONE $221.5 2 20 ORCHARD CONSTR FIRESTONE 5196.0 0 0 0 0 0 0 0 1 01 VWOOOCREST HOMES FIRESTONE 5264.9 3 3 30 1 OVELOOK AT FIRESTONE ADAM PARKER CONSTR FIRESTONE $2143 3 I 2 3 0 1 7 0 3 3 1 5 1 24 12 RIDGE CREST US HOME FIRESTONE $2256 19 16 13 14 12 10 10 5 1 10 6 11 3 106 33 RUSSELL SUB TJH PROPERTIES FIRESTONE $1190 I 10 1 ST VRAIN RANCH BARCEWSKI MASTER BLDRS FIRESTONE 5345.5 1 10 CHANIN BLDRS FIRESTONE $295 1 0 0 0 0 1 03 COO IRONWOOD HOMES FIRESTONE 53730 1 10 GENESEE CO FIRESTONE $328 6 1 10 GL CUSTOM BLDRS FIRESTONE $350.0 0 0 0 1 03 KLEPPE JON FIRESTONE $292.5 2 Y0 LOPTIEN D SCOTT FIRESTONE $3063 1 10 MCHUGH HOMES FIRESTONE $3520 1 0 0 0 0 1 03 PENMEN DEVL FIRESTONE 5476.0 I I I 0 SONPOINTE HOMES FIRESTONE $447.0 1 I 10 I I I I I I I I I I I I I I I I I ► i AVG 2001 • RECORDED NEW HOME SALES 2002 Y1D 02 SALES SUB- SUBDIVISION SELLERIBUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG DIVISION STAINBROOK FIRESTONE 54204 1 0 10 STEVENS MIKE FIRESTONE $3550 0 0 0 0 0 1 0 0 0 0 0 1 1 0.2 4 IFINmck ANGEL VIEW EST CORNERSTONE FREDERICK $4907 1 10 1 COUNTRY MEADOWS FARM EUTE HOMES FREDERICK 5585.8 1 0 1 07 THOMAS CONSTR DEXPERT FREDERICK 5431.5 1 10 0 COUNTRYSIDE CENTEX HOMES FREDERICK 5202.9 I 10 1 EAGLE VALLEY DR HORTON/MELODY HOMES FREDERICK 52698 8 12 4 8 6 0 2 59 2 FOX RUN DR HORTON/MELODY HOMES FREDERICK $205.1 11 13 4 10 1 9 16 0 5 3 5 3 83 37 MAPLE RIDGE COLO CONSTR DEVL CORP FREDERICK ' $223 9 0 1 1 2 1 10 COLO IRONWOOD HOMES FREDERICK $209 5 1 0.5 DAYSTAR VI FREDERICK 52834 0 1 03 DESIGNER HOMES FREDERICK 52200 10 MIRANDA HOMES FREDERICK 52673 0 0 0 0 1 0J SICHEL JOHN A FREDERICK $212 9 10 0 NONAME CREEK EST COLO IRONWOOD HOMES FREDERICK $2599 0 0 0 1 02 CRM BLDRS LLC FREDERICK $300.0 1 10 DAYSTAR ENT FREDERICK 5368.0 1 10 DSM DESIGN FREDERICK 5305.0 I 10 HOIMWOO0 BRIAN FREDERICK $350.0 I 10 KCM BLDG GROUP FREDERICK 52399 1 10 KHDESIGWPROPERTIES FREDERICK $384.3 2 0 0 0 1 06 KVC INC FREDERICK $368.0 I 10 RCRH 2000 FREDERICK $434.9 I 10 SNYDER SUSAN&DANIEL FREDERICK 5282.0 I 10 STRAUSS HOMES FREDERICK 52310 3 3 4 2 0 30 WADLE GERALD FREDERICK $347 5 1 0 10 • SKYLINE BLDRS FREDERICK 5100.0 1 1 10 7 PARKVIEW EST MARQUIS HOMES FREDERICK $194 0 I 1 I0 1 SAVANNAH SUB DRHORTOWMELODY HOMES FREDERICK $120.7 1 10 8 4 8 29 58 29 SUMMIT VIEW ESTATES CAPITAL PACIFIC HOLDINGS LLC FREDERICK $2857 5 0 3 5 0 5 6 1 2 10 1 3 17 34 17 IFoR Lupton I BUFFALO RIDGE EST BILL MOST CONSTR FT LUPTON $291 8 1 0 10 NAtITFHFAD CONSTR FT LUPTON 5256.9 1 0 10 0 COYOTE CREEK EPEK BLOBS FT LUPTON $1649 1 1 2 I0 KB HOME WADE MAN BROAD' FT LUPTON $1890 5 3 4 1 2 4 0 32 2 GRANDVIEW W SOUARE CONSTR FT LUPTON $2400 1 1 10 1 'Johnstown CARLSON!ARMS ADVOCATE LAND JOHNSTOWN 52791 4 5 1 2 4 4 2 3 1 1 3 2 10 17 G BEVER CONSI JOHNSTOWN $2424 1 0 2 1 0 0 0 0 1 0 0 2 ] 06 TINN SILOS JOHNSTOWN 52336 1 I 1 0 14 I I I I I I I I I I I I I I I I I I 1 • AVG 2001 RECORDED NEW HOME SALES 2002 YID 02 SALES SUB_ SUBDIVISION SELLER/BUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG DIVISION KNOLLS GRAYBILL BRENT W/FAWN JOHNSTOWN $1680 I I I0 0 NORTHMOOR AC 2 MICHAEL DUNN CUSTOM HOMES JOHNSTOWN $349.0 1 10 1 REDSTONE HILLS ADDN CARLSON CONSTR JOHNSTOWN $243.5 1 10 GARCIA FRANCISCO JR JOHNSTOWN 1223.9 1 10 0 ROLLING HILLS RANCH KDN CUSTOM HOMES JOHNSTOWN $279.9 1 I.0 TJ BUILDERS JOHNSTOWN $183.5 0 1 2 0 0 0 1 0 1 10 HARMON HOMES JOHNSTOWN $193.0 0 0 0 2 0 1 0 0 2 05 GILLAMDEVELOPMENT JOHNSTOWN $150.5 3 4 1 3 1 3 2 1 3 5 1 20 JOHN WALZ ENT INC JOHNSTOWN $190.3 0 03 TIMBERSMITHS JOHNSTOWN $253.0 2 0 0 0 1 0 I 1 0.5 IDS CONSTRUCTION JOHNSTOWN $2000 0 0 1 I 0 1 0 0 1 I 04 25 STROH FARM RICHMOND AM HOMES 0010 JOHNSTOWN $264.7 1 0 3 1 2 1 1 14 RYLAND GROUP JOHNSTOWN $271.1 5 4 2 3 2 7 5 0 1 1 2 29 IS IK4an.AEur9 I ASH HOLLOW 2,3 LIFESTYLE HOMES KEENESBUR $1722 3 5 6 2 9 2 3 8 5 10 5 5 33 57 33 HOWSER&TIMBERS CRGDEVL KEENESBUR $2200 1 0 10 0 ILA SIN HUNT WEDEMAN SCHNEIDER GARY LA SALLE $2150 1 I 10 SCHNEIDER KEVIN LASALLE $250 0 0 1 10 1 ILachbme I HIGHPLAINS I SATURN HOMES LOCHBUIE $155.5 11 9 8 7 9 12 11 3 5 14 8 14 44 93 44 !Longmont I BOOTH FARMS RYLAND GROUP LONGMONT $3076 1 8 4 6 12 2 12 2 1 3 1 5 12 4A 12 CHAMPION GREENS CG DEVL LONGMONT 32966 1 0 10 JD COLLINS CONSTR LONGMONT $298.2 2 0 I 2 0 13 0 DODD ESTATES JOIN DING HOMES LONGMONT $2541 3 6 6 3 11 6 0 15 10 12 2 4 43 7 2 43 Fox MEADOW JAMES CONSTR LONGMONT $299.8 1 2 2 2 4 11 22 ENGLE HOMES COLO LONGMONT $321.7 3 2 3 2 4 14 28 25 FOX CREEK FARM CENTS% LONGMONT $228 I 2 0 20 0 GOLDEN POND ESTATES BRITTANYBLDRS LONGMONT $362.9 2 2 4 0 3 1 2 3 3 21 0 JOHNSON FARM OOWRON BUMS LONGMONT 3485.5 0 0 1 0 03 0 LAKE MCINTOSH FARM LAHR CONSTR LONGMONT $7525 1 1 10 MASTER CRAFTSMAN HOMES LONGMONT 35750 1 0 I0 MCDAOOY LLC LONGMONT 16390 1 0 10 T RUH GROUP LLC LONGMONT 18720 1 0 I0 1 LEGEND RIDGE I LEGEND CUSTOM HOMES LONGMONT 91,5490 1 1 10 1 LIGHTHOUSE COVE CONRADS JOHN A LONGMONT $750 0 1 0 10 0 MEADOW VALE.ELMS a RYLAND GROUP LONGMONT $3734 4 5 4 5 9 3 2 2 2 1 2 2 9 04 9 MEADOWVIEW MCSTAIN ENTERPRISES LONGMONT $384 6 0 0 0 0 0 2 1 0 04 0 I I I I I 1 I I I I I I I I I I I I I AVG 2001 RECORDED NEW HOME SALES 2002 YTD 02 SALES SUB. SUBDIVISION SELLER/BUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG DIVISION MILL VILLAGE TAHSIS DEVL ONGMONT $917.0 I 0 I0 PARAGON BLDRSDEVL ONGMONT $224.3 0 2 4 I 3 2 4 I 3 5 2 1 12 2.3 BEYCHEVELLE ONGMONT $245 0 I 1 I 3 10 CRT DEL ONGMONT $3100 I 0 1 0 01 IS NONAME CREEK EST GALLERY HOMES ONGMONT $2202 0 1 1 1 0 1 0 0T ADAM PARKER CONSTR ONGMONT $333.0 1 1 10 1 OAK MEADOWS RICHMOND AM HOMES COLO ONGMONT $2433 3 7 6 1 1 9 3 5 2 5 2 2 16 38 15 PLEASANT VALLEY DR HORTON/MELODY HOMES ONGMONT $2491 10 14 16 9 10 14 13 12 6 8 0 4 36 103 35 QUAIL CROSSING RICHMOND AM HOMES ONGMONT $2824 6 I1 11 18 10 7 14 10 0 15 4 13 4 99 42 QUAIL RIDGE FILM ENTERPRISES INC ONGMONT $252.2 1 1 3 0 2 I 2 1 2 0 0 1 1 2 WALNUT MOUNT CONST ONGMONT $308.2 1 10 CRESTONE HOMES/CORP ONGMONT $3185 2 0 0 0 1 06 4 RANCH CLOVER BASIN PORTICO DEVL ONGMONT $324.I I 10 1 RENAISSANCE ASHLAND CUSOTM HOMES ONGMONT $805.0 1 10 BARCEWSKI MASTER&DRS ONGMONT $3933 0 0 0 1 03 CAPITAL PACIFIC HOLDINGS/HOLIES ONGMONT $5615 I 0 0 0 0 0 4 0 0 2 0 2 CORNERSTONE HOMES ONGMONT $410.9 1 0 0 0 0 1 0 0 0 0 1 03 GENESEE CO ONGMONT $420.0 0 I 2 0 0 0 1 0 I 06 GL CUSTOM BLURS ONGMONT $5059 0 0 0 1 03 KEYSTONE HOMES ONGMONT $6500 I 10 SOPRIS DEVL ONGMONT $6261 1 0 0 0 0 1 03 TL STAUFFER CONSTR ONGMONT $387.1 0 1 0 0 0 0 0 0 0 0 1 02 8 RIDER RIDGE FARM WWOCREST HOMES ONGMONT $264 4 2 20 0 SOMERSET ESTATES LELA DESIGN CONSTR ONGMONT $2,000.0 1 1.0 0 SPRING VALLEY CENTEX ONGMONT 13205 4 7 1 3 9 10 8 12 15 13 86 96 CORNERSTONE INC ONCAIONT $442 0 1 1 1 1 2 2 0.9 GENESEE CO ONGMONT $4902 2 3 0 1 0 I 2 3 11 MARKEL HOMES ONGMONT $390.0 1 0 1 0 I 0 0 1 2 0.5 ARNOLD HOMES/RETREAT UTE CREEK LL ONGMONT $2920 3 2 0 I4 GREYBRIDGE HOMES ONGMONT $598.2 1 0 0 0 0 1 0 0 1 2 0.3 SOPRISDEVL ONGMONT $520.0 0 1 0 0 0 0 1 0 1 2 04 BURNING BUSH ENT ONGMONT $354.9 0 10 77 ST VRAIN RANCH CT CUSTOMBLORS ONGMONT $3850 0 0 0 0 0 0 1 1 03 LUDWIG HOMES Lit ONGMONT $3723 0 0 1 0 0 0 0 0 0 1 I 02 TL STAUFFER CONSTR ONGMONT $3399 0 0 0 0 0 0 0 0 0 1 I 01 RYLAND GROUP ONGMONT $225.8 5 12 9 3 I 3 5 0 0 2 4 11 44 14 WALLACE/PROSPECT ROSENTHAL HOMES ONGMONT $561.7 1 0 10 BEN THOMAS CONSTR ONGMONT $3200 0 0 0 0 0 0 0 0 0 1 1 01 GREENBRIAR HOMES ONGMONT $6611 0 0 0 0 0 0 0 1 I 01 LELANDCONSTR ONGMONT $460.0 I 0 0 0 0 0 1 0 1 1 2 04 ITHACA DEVL ONGMONT $3436 1 0 I 0 02 4 WESTBROOK VILLAGE FM PARTNERS LONGMONT ONGMONT $3104 0 0 2 0 02 0 W1:STLAKE MANORS DAYSTAR VI ONGMONT $3533 1 0 I 0 0 0 0 0 0 0 0 2 2 0.3 PILKINGTON HERMAN CONSTR ONGMONT $409.0 0 0 0 0 0 1 0 0 0 1 I 02 ADAM PARKER CONSTR ONGMONT $2912 0 0 0 0 0 1 0 02 GLCUSTOM BLDRS ONGMONT 8350.0 0 0 0 0 1 0 02 JD COLLINS CONSTR ONGMONT $3439 0 0 0 0 1 0 0 1 I 2 03 5 WOLF CREEK VILLAGE) CENTEX ONGMONT $2151 6 5 7 10 9 5 2 10 8 3 10 5 36 71 04 I I I I I I I I I I I I I I I I I I I • AVG 2001 RECORDED NEW HOME SALES 2002 YID 02 SALES SUB- i SUBDIVISION SELLER/BUILDER LOCATION PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG DIVISION "Mead I MARGIL FARMS BARCEWSKI MASTER BLORS MEAD 54385 1 0 10 DSMOESIGN MEAD 5432.0 1 0 0 0 0 I 1 03 FRICKE JOHN MEAD $148.5 0 0 0 1 0 03 GARCIA FRANCISCO JR MEAD $36.9 1 0 10 GRIEVE ALLAN MEAD $399.9 1 0 1.0 HOSKINSCONSTR MEAD $399.6 0 1 0 0 0 0 1 0 03 RR HOMES NORTHER COLO MEAD $4127 0 0 0 0 1 0 02 VALE VIEW DLONG CUSTOM HOMES MEAD 5835.0 1 0 1.0 PROVENCE DAVIS LTD MEAD $926.7 0 1 0 05 SUGARBUSH HOME BLOC MEAD $8950 0 0 0 0 0 0 2 0 03 1 'Milliken I BLEHM WATERWAY EST GREAT NORTHERN PROPERTIES MILLIKEN $280.0 I I 10 LEIVESTAD BERKLEY FILERS INC MILLIKEN $271.0 0 1 0 0 5 OMNI CONSTR LOVELAND MILLIKEN $295.• 1 0 10 1 CENTENNIAL FARMS GOSCHA RORY MILLIKEN 3173.7 1 0 0 I 2 05 HACIENDABLGRS MILLIKEN $1708 1 1 10 .0 CONSTR NORTHERN COLO MILLIKEN $159.3 2 0 2 0 0 0 4 4 6 1.5 JOURNEY HOMES MILLIKEN $14.5 1 1 0 1 0 1 5 7 1.3 TIMBERSMITHS MILUKEN $165.5 2 2 2.0 20 COLONY POINTE RAMIREZ ENT MILLIKEN 6199.5 1 1 10 1 FRANK FARM RUST CONST MILLIKEN $1975 1 0 1 1 1 2 0 3 0 3 1 2 9 1.3 STEINER MARK MIWKEN $1550 1 0 1.0 MOUNT VISTABLDRS MILLIKEN $1726 2 4 6 8 10 9 6 4 2 5 1 3 IS 50 24 MAD RUSSIAN ESTATES GEMM HOMES MILLIKEN $2699 0 1 1 0 0 0 0 0 0 1 0 2 3 04 HARMONIIOMES MILUKEN $2938 1 0 2 2 0 0 0 1 0 1 1 3 07 GILLAM DEVELOPMENT MILUKEN 32228 I 0 2 2 1 2 0 3 2 1 1 7 1• HI BELL CONST MIWKEN $203.5 0 0 1 2 0 1 2 1 0 1 2 08 RON EHRLICH REAL EST MILLIKEN $270.0 1 1 I0 16 MILL IRON 5 RANCH EST LARRY HAAS CONSTR MILLIKEN $3190 I 1 10 1 PRAIRIE VIEW SUB SIVE STAR ENTERPRISES MILLIKEN $1900 1 1 10 1 WILDCAT ACRES PARKER CUSTOM HOMES MILLIKEN $2578 0 0 0 2 0 05 0 !manna. - -I BEEBE DRAW FARMS TL STAUFFER CONSTR PLATTEVILLE $3500 1 0 10 OLDS TIME CUSTOM HOMES PLATTEVILLE $405 I 1 10 ISLER JOSH PLATTEVILLE $382 0 1 0 10 1 REEDS EZRA HOMES PLATTEVILLE $1760 1 0 10 0 RODGERS FARM PLUMB CONSTRUCTION PLATTEVILLE 11759 3 5 1 4 3 5 1 1 S 3 0 1 10 27 10 'TOTAL 12216 283 276 21• 309 254 2/5 249 187 234 183 1224$ 1,086 412 1.016 'AVERAGE 82.95 2.02 2.14 1.74 2.51 2.19 2.48 201 1.60 206 206 144.06 4.02 1.52 Source.Hone Builders Research and THK Associates,Inc. D. Proposed and Planned Detached Projects in the Pinnacle Farms Trade Area Environs As expected given the strong population and household growth in the trade area, there are numerous proposed residential projects in the site environs. Some of the larger of those proposed projects are profiled by location,type,total units,and status in Table IV-7. Pinnacle Farms Trade Area • At present, there are approximately 8,100 planned single-family detached units that have been approved in the trade area environs. • The smallest project is Meadow View West in Longmont with 20 planned units; Silver Peaks in Lochbuie is the largest with over 1,700 planned units. • Numerous projects are still working their way through the entitlement process; these projects include approximately 23,000 units. PINNACLE FARMS 45 THKAssociares,Inc. Number — Project Name Address Location of Units Status 58 Teets Annexation Both sides of CO Rd 20 E of CO Rd 15 Firestone 2.574 Annex&Zoning/Approved 59 Vogl Annexation E of WCR 15&N/S of WCR 24 Firestone 782 Annex&Zoning/Approved 60 Country Meadow Farms/Wildflower NEC WCR 7&16 Frederick 392 Sketch plan/Process 61 The Farm W of No Name Creek Adj to WCR 20 Frederick 290 Final plan/Approved 62 Hi-West SWC WCR 18&11 btwn 18&15 Frederick 619 Sketch plan/Process 63 Johnson Annexation Hwy 52&Main St Frederick 300 Annex&Zoning!Approved — 64 Moore Farms WCR 20 btwn WCR 13&11 Frederick 190 Final plan/Process 65 Rinn Valley Ranch SEC WCR 7&20.5 Frederick 70 Final plan/Approved 66 Sandstone NWC W Frontage Rd&WCR 20 Frederick 66 Sketch plan/Process 67 Strear Farm NWC of WCR 13&52 Frederick 650 Sketch plan/Process — 68 Apple Farm Est SE of Hwy 52.E of Beth Ave Fort Lupton 136 Final plan/Approved 69 Ft Lupton North NNE CR141/2&College Ave Extended Fort Lupton 300 Sketch plan/Withdrawn 70 Holton Farm N of Cahill&W of Coyote Creek Dr Fort Lupton 94 Sketch plan/Process 71 Silver Peaks Lochbuie Lochbuie 1,773 Preliminary plan/Approved 72 Blue Mountain Vista NWC 95th&Hwy 66 Longmont 34 Final plan/Approved — 73 Blue Sky Vista S of Quail Rd&E of Emery St Longmont 126 Preliminary Plan/Process 74 Clover Basin,Ranch @ 75th&Plateau Rd Longmont 53 Final plan/Approved 75 Fox Meadows FIg 3 S of E 9th Ave&W of County Line Rd Longmont 165 Final plan/Process 76 Kanemoto Estates E of Airport Rd Longmont 36 Preliminary Plan/Process — 77 L&S S of Airport Rd&1.5 mi 5 of Nelson Rd Longmont 34 Final plan/Process 78 Meadow Mountain 1 mi S of Nelson Rd Longmont 294 Final plan/Approved 79 Meadow View West/Kern 5 of Nelson Rd&1.5 mi W of Airport Rd Longmont 20 Final plan/Approved • 80 Pleasant Valley 3 S of Hwy 66,W of Pace Longmont 41 Final plan/Approved — 81 Prairie Village 1533 W Alpine St Longmont 57 Final plan/Approved 82 Quail East Se Quail Rd&Hwy 287 Longmont 80 Final plan/Approved 83 Renaissance Flg 2 W of Airport Rd&S of Buckhorne Dr Longmont 208 Final plan/Approved 84 Renaissance Flg 3 W of Airport Rd&S of Buckhorne Dr Longmont 286 Final plan/Process 85 Renaissance Flg 4 Clover Basin Rd&3/4 M W of Airport Rd Longmont 128 Preliminary Plan/Process 86 Renaissance.Reserve @ Wof Airport Rd&1/2 mi S of Clover Basin Longmont 54 Final plan/Approved 87 Somerset Meadows SW Airport Rd&Nelson Rd Longmont 199 Final plan/Approved 88 Spring Valley V E of Pace St&N of 17th Ave Longmont 397 Final plan/Approved — 89 Spring Valley VI NW Pace St&17th Ave Longmont 146 Final plan/Approved 90 Spring Valley Vll N of 17th Ave&W of Jimm Hamm Nature Area Longmont 95 Final plan/Approved 91 Spring Valley X SE Hwy 66&Pace Longmont 24 Preliminary Plan/Process 92 Spring Valley Xl SW Hwy 66&County Line Rd Longmont 100 Final plan/Process — 93 Summerlin 1/2 mi N of Diagnal Hwy,W side of Airport Rd Longmont 35 PUD/Approved 94 Coyote Run S of CO Rd 36,E of l-25 Mead 156 Final plan/Approved 95 Margil Farms CO Rd 38W of I-25 Mead 880 Master plan/Approved 96 Prairie Hills Est N end of 1st St Mead 58 Annex&Zoning/Approved — 97 Range View Est/Evergreen Farm CO Rd &CO Rd 32 Mead 73 Annex&Zoning/Approved 98 Sanborn SE Hwy 66&1-25 Mead 251 Annex&Zoning/Process 99 Westerian Annexation S Hwy 66 E CR 91/2.W of CR13 Mead 948 Annex&Zoning/Approved 100 Boulter Farms SEC WCR 251/2&WCR 34 Platteville 123 Annex&Zoning/On hold 101 MJ Farms PUD NW of Hwy 85&CR34 Platteville 1,200 Annex&Zoning!Process 102 Platte River Farm SW of Hwy 66&Main St Platteville 99 Preliminary Plan/Process 103 Shun Annexation SE of Hwy 85&CR34 Platteville 500 Annex/Process — TOTAL APPROVED(FINAL PLAN) 8,143 TOTAL IN PROCESS 31,028 TOTAL 39,171 AVERAGE 380 •Several projects include some attached units(unit count not yet separated),so total modestly overstated. Source: Applicable Planning Department.Home Builders and THK Associates PINNACLE FARMS 47 THK Associates,Inc. E. Active Attached Residential Projects in the Pinnacle Farms Trade Area Environs There are currently 14 active attached (townhome/condominium) projects in the trade area environs. All 14 projects are listed in Table IV-8 and all 14 are profiled in Table IV-9 with some of the more significant findings detailed below. • Eight of the 14 projects have sold between zero and four units during the first five months of this year. Two projects sold between five and nine units,and four sold more than ten. • Half of the 14 projects are averaging sales of zero to two per month,and only two projects are selling more than four units per month. • Most of the attached product in the area is fairly reasonably priced. Approximately 57.0% of the projects have an average unit price in the $125,000-$199,999 range and 28.0% have an average unit price in the $200,000-$349,999 range. Two projects have an average unit price below$125,000. Table IV-8: Characteristics of Attached Residential Projects in the Pinnacle Farms Trade Area Environs,2002 A.Projects by Number of Units Sold• B.Projects by Monthly Sales Average Number %of Total Number %of Total Units Sold of Projects Total Units Sold of Projects Total 0-4 8 57.1% 0-1.99 7 50.0% • 5-9 2 14.3% 2-3.99 5 35.7% 10-14 2 14.3% 4-5.99 1 7.1% 15-19 2 143% 6-7.99 1 7.1% 20+ 0 0.0% 8-9.99 0 0.0% _. 10+ 0 0.0% TOTAL 14 100.0% TOTAL 14 100.0% C.Projects by Average Unit Price Number of %of Unit Price Range Projects Total Under 5125,000 2 14.3% $125,0003149,999 3 21.4% $150,000-$199,999 5 35.7% 5200,000-5249,999 2 14.3% 5250,000-5299,999 1 7.1% 5300,000-5349,999 1 7.1% 5350,000+ 0 0.0% TOTAL 14 100.0% • 2002 sales through May Source: THK Associates,Inc. PINNACLE FARMS 48 THK Associates,Inc. I I I I I I I I I I I 1 I I I I I I TABLE IV-9:ATTACHED SALES IN THE PINNACLE FARMS PRIMARY TRADE AREA ENVIRONS,2002 5 MOS MONTHLY AVG 2001 RECORDED NEW HOME SALES 2002 YTD 02 SALES LOCATION/SUBDIVISION SELLER/BUILDER CITY PRICE JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY SALES AVG 'Brighton BROMLEY LANE CONDOS/RIDGE @ PARKSIDE HOMES BRIGHTON $149.9 3 3 30 JASMINE ESTATES ROWNHOMES EQUINOKUASMINE ESTATES BRIGHTON 5154.6 8 16 13 7 4 8 12 5 5 2 6 1 19 73 'Dancing I SUNDANCE SUB NEEDA HOMES DACONO $152.0 1 1 0 3 3 2 1 2 1 3 3 2 11 1.8 He I BLUE EAGLE CONDOS GRASSFIELD B A ERIE $86 7 3 0 30 'Johnstown I CHARLOTTE SQUARE TOWNHOME 5 AMES WALTER J III JOHNSTOW 5147.2 0 1 1 0 0 0 0 0 1 I 03 'Longmont CREEKSIDENJATERSONG 53 WATERSONGTOWNHOUSESIPEAK LONGMONT 5230.0 0 3 6 2 5 6 4 3 5 2 3 1 14 33 HOVER WOODS CONDOS BOWRONBLDRS LONGMONT $305.9 1 0 3 0 1 0 0 0 0 1 0 1 2 06 MILL VILLAGE CONDOSRIVERBEND@ PARKSIDE HOMES LONGMONT $149.7 0 1 0 1 1 0 06 POPLAR GROVE TOWNHOME CONDOS KUDOS LONGMONT $187.8 2 0 4 2 0 7 0 2 0 3 1 2 B 19 QUAIL CROSSING TOWNHOMES JAMES CONSTR LONGMONT 5156.6 1 0 L0 QUAIL RIDGE CONDOSIPARKVIEW@ LOMARDEVL LONGMONT $218.9 0 0 0 0 0 5 2 0 0 1 2 1 4 0.9 RENAISSANCE SUB,HERITAGE TOVNHOMES CESSNA ASSOC/HERITAGE GREENS LEGACY RID LONGMONT $2642 2 4 6 4 7 1 3 6 3 4 5 1 19 38 SUNNYVALE CONDOS SUNNYVALE 4 LLC LONGMONT $107.5 2 2 6 1 4 3 3 0 0 1 0 4 5 2 2 UTE CREEK CONDOSNILLAS@ UTE CREEK VILLAS LONGMONT $1790 7 4 8 0 3 4 10 1 1 46 TOTAL 24 32 47 20 31 36 35 19 15 17 20 13 84 AVERAGE 2.0 2.9 4.3 1.8 2.6 3.6 3.5 1.9 1.7 2.1 2.5 1.6 6.5 Sou¢a.Home Builders Research and THK Associates,Inc F. Proposed Attached Residential Projects in the Pinnacle Farms Trade Area Environs As the residential market matures in the more suburban locations that comprise the Pinnacle Farms primary trade area, the number of planned townhome/condominium projects in the — market area is likely to increase. The bulk of the proposed attached projects in the area are profiled by location,type,total units,and status in Table IV-10. — • At present there are approximately 3,100 single-family attached units that have either been recently approved or are working their way through the approval process. — • Combined,these projects average approximately 200 units. • The Silver Peaks project in Lochbuie has the most proposed units(1,300). Table IV-10:Proposed Condominium/Townhome Projects in the Pinnacle Farms Trade Area Environs — Number • Project Name Address Location of Units Status — 1 Bridge Crossing Bridge&27th Brighton 393 Annex/Process 2 Chapel Hill Tower&Bridge Brighton 18 Preliminary plat/Process 3 Kannoy/Kennedy SW Bridge&Telluride Brighton 28 Final plan/Process 4 Landmark/Brighton Crossing Bridge,50th.&Baseline Brighton 280 Final plan/Approved — 5 Mountain View II SW of CO Rd 2&Telluride Brighton 191 ODP/Approved 6 Pheasant Ridge Bridge&Telluride/Tower Brighton 109 Final plan/Process 7 Platte View Farm Miller&Hwy 7 Brighton 216 Preliminary plat/Process 8 Spring Hollow Sot Bridge btwn 18&19 Brighton 108 • Final plan/Approved — 9 Pinnacle Farms SWC Hwy 52&WCR 11 Dacono 120 Sketch plan/Process 10 Sweetgrass Flg 1 NE I-25&CO Rd 8 Dacono 76 Final plan/Approved 11 Sweetgrass Master Plan NE I-25&CO Rd 8 Dacono 525 Revised Master Plan/Approved 12 Strear Farm NWC WCR 13&52 Frederick 350 Sketch plan/Process — 13 Holton Farm N of Cahill&W of Coyote Creek Drive Fort Lupton 150 Sketch plan/Process 14 Silver Peaks Duplex Lochbule Lochbuie 1,303 Preliminary plat/Approved 15 Clover Basin SW Nelson Road&Airport Road Longmont 246 Final plan/Approved 16 Meadow Mountain 1 Mile 5 of Nelson Road Longmont 52 Final plan/Approved 17 Meadow View West/Kern S of Nelson Rd&1.5 mi W of Airport Rd Longmont 120 Final plan/Approved 18 Mill Village 3&4 SW 9th Ave&Hover St Longmont 63 Site plan/Process 19 Prairie Village 1533 W Alpine St Longmont 16 Final plan/Approved 20 Quail Ridge SE SH287&Quail Rd Longmont 18 Final plan/Process 21 Renaissance Flg1&3 Wor Airport Rd&S of Buckhorne Dr Longmont 342 Final plan/Process 22 Renaissance,Reserve @ Wof Airport Rd&S of Clover Basin Dr Longmont 30 Final plan/Approved 23 Spring Valley V&X E of Pace&N of 17th Longmont 84 Final plan/Approved 24 Wallace Addition SW Pike Rd&SH287 Longmont 44 Final plan/Approved TOTAL APPROVED(FINAL PLAN) 1772 TOTAL IN PROCESS 3,110 TOTAL - 4,882 AVERAGE 203 Projects with an unseparated mix of detached and attached units included on detached table,so total modestly understated. — Source:Applicable Planning Department,Home Builders and TIC Associates PINNACLE FARMS 50 THKAssociates,Inc. V. SINGLE-FAMILY DETACHED AND ATTACHED UNIT/LOT SALES POTENTIALS AT THE - PINNACLE FARMS SITE The success of residential development at Pinnacle Farms will depend on a number of factors: location, physical suitability of the site for development, and the overall market conditions for residential sales. Physically, the site appears well suited for residential development. Moreover,its easy access to I-25 and planned open space will help draw residents. The supply and demand sides of the residential market in the Pinnacle Farms primary trade area were evaluated in the previous sections of this report. It was established that the primary trade area will have an annual average demand for approximately 2,546 single-family, detached units and 320 single-family attached units through the year 2012. THK's projected capture rates for residential units at Pinnacle Farms are shown in the — following tables. The unit/lot demand by price range and unit type in the primary trade area was projected earlier based upon the projected income and demographic characteristics of the population in the trade area. The capture rates for the site show the share of each market segment that the subject property is expected to capture. The important elements to evaluate when determining capture rates are the prestige and scale of the community and the quality and character of the immediate area. The capture — rates shown reflect the differences in the quality of the location, reputation, planning and amenities of competitive developments. These capture rates were determined based upon the geographic attributes of the subject site and those of competitive projects,as well as the — riumber of competitors in a given price range within the trade area. 1. Detached Units/Lots Based on the competitive review of other projects and the location of the site, THK believes that the Pinnacle Farms site will be able to capture a generic capture rate of the single-family — market in the two key price ranges where it should compete. In order to determine capture rates, THK reviewed the number of existing competitors and determined those that will still be marketing product in the coming year. THK then allowed for new project and resale competition and estimated a "fair" share capture rate, adjusted for the site. THK has estimated the Pinnacle Farms project will be able to capture approximately 7% of the demand for homes priced in the $160,000-$200,000 price range, and 4%of the homes priced in the $200,000-$300,000 price range. Table V-1 displays THK's projected single-family unit/lot absorption for the Pinnacle Farms site. An average annual demand of 2,546 units/lots over the next ten years is expected in the trade area. Based on this anticipated demand and the programmed capture rates, the site — could sell all of its 452 units/lots within an eight-year timeframe. Approximately half of those homes should be priced under$200,000. PINNACLE FARMS 51 THK Associates,Inc. — Table V-1: Projected Single Family Detached Demand and Acreage Absorption at the Pinnacle Farms Site, 2003-2010 Estimated Under $35,000 $44,000 $66,000 Lot Prices $35,200 $44,000 $66,000 & Above Under $160,000 $200,000 $300,000 Annual Cumulative Home Prices: $160,000 $200,000 $300,000 & Above Total Total Annual Average Demand in the Primary Trade Area: 558 384 738 866 2,546 — Number of Competitors: 8 13 24 20 Generic Capture Rate: 11.1% 7.2% 4.0% 4.8% Site Capture Rate: 0.0% 7.2% 4.0% 0.0% 2.2% Annual Absorption(Units) — 2003 0 25 26 0 51 51 2004 0 25 27 0 52 103 2005 0 26 28 0 54 157 2006 0 27 29 0 55 213 2007 0 28 29 0 57 270 2008 0 29 30 0 59 329 2009 0 29 31 0 60 389 2010 0 30 32 0 62 452 — Total 0 219 232 0 452 Annual Average 0 27 29 0 56 — Average Lot Size (SF) 0 4,500 6,300 0 5,400 Average Net Density 0.0 10.0 7.0 0.0 8.2 Net Acres (Annual Average) 0.0 2.7 4.1 0.0 6.8 Net Acres 0 22 33 0 55 Source: THK Associates, Inc. PINNACLE FARMS 52 THK Associates,Inc. 2. Attached(Patio Home/Townhome)Units/Lots As quantified in the previous section, THK anticipates more modest demand for attached product in the trade area over the next decade. In fact,THK projects that the average annual demand during the 2002-2012 period for attached units in the trade area will total approximately 320. Pinnacle Farms should be able to capture a solid percentage of this demand, even though it is anticipated that there will be significantly more competition in the patio home/townhome arena in the coming years (the proposed project list is extensive- see — Table IV-10). THK projects a five-year build-out for the project's 200 planned units. Table V-2: Projected Single Family Attached Demand and Acreage Absorption at the Pinnacle Farms Site, 2003-2007 — Estimated Under $29,000 $36,000 Lot Prices $28,800 $36,000 & Above • Under $160,000 $200,000 Annual Cumulative — Home Prices: $160,000 $200,000 & Above Total Total Annual Average Demand in the Primary Trade Area: 121 61 137 320 Number of Competitors: 5 5 4 Generic Capture Rate: 16.7% 16.7% 20.0% 16.7% Site Capture Rate: 16.7% 16.7% 8.8% 12.3% Annual Absorption(Units) 2003 18 9 11 38 38 2004 18 9 11 39 77 2005 19 10 11 40 116 2006 20 10 12 41 158 — 2007 20 10 12 42 200 Total 95 48 57 200 — Annual Average 19 9 11 39 Average Net Density 9.0 9.0 9.0 9.0 — Net Acres(Annual Average) 2.1 1.0 1.2 4.4 Net Acres 11 5 6 22 Source: THK Associates, Inc. PINNACLE FARMS 53 THK Associates,Inc. - fs M MEMORANDUM Date: September 25, 2002 To: Mr. Ryan Carlson Carlson Associates P.O. Box 247 asilake, Colorado 80614 From: Pat Brophy THK Associates, Inc. i2^ Pinnacle Farms • • Per your request, THK has examined the absorption potentials presented in the financing plan prepared by Clifton Gunderson. In order for Pinnacle Farms to achieve the residential soles velocities projected in the aforemen'loned financing plan, the project would need to capture approximately 17% of the primary trade rrea's single-family detached demand in the $160,000-$200,000 price range (11-iK projected a 7.2% capture rate) and approximately 5% of its demand in the $200,000i$300,000 price range (THK projected a 4 0% capture rate). In terms of sales of attached res'.dential product, Pinnacle Farms would need to capture approximately 22% of trade area demand (THK projected a 16.7% c?plure rate). Tne key factors in determining capture rates ore the number of competitors and the character and quality of their overall de\,clopm:;nts relative to what is anticipated for the proposed prcjact. Accordingly, an upwards sht't in capture rates is typically the result of loss of the planned and/or proposed ccmpetiYon in the trade area coming on line or :upeifor amenities and/or attractions atll esubj ct property. Other factors that can bump capture rates include location, access, r r.rke6rw programs and expenditures, community d: sicrn. bul!ders, and product types. If you need any additional assistance, Please do not hesitate to call. f?^st Regards, Pat Brophy 7 53 Soy t'= arc:z 5"act.S tc 101 Aurora.Coloer):: 80014 3C3 773 72:1 l 303 770 7132 fax In'o@rakasscc cat c5 also n 12460 1st Street P.O. Box 247 Eastlake,Colorado 80614-0247 Office:303-457-2966 Fax: 303-280-2978 September 20, 2202 City of Dacono Attn: Karen Cumbo 512 Cherry Street Dacono, Co. 80514 Dear Karen, We have received and reviewed the "Residential Market Analysis" prepared by THK Associates, Inc. for the proposed Pinnacle Farms Subdivision in Dacono. We are in agreement with the analysis and the expected absorption levels for the project as described by THK. Sincerely, Pinnacle Farms, L.L.C. a Colorado Limited Liability Company By:CC2C k EXHIBIT F Underwriter's Letter KIRKPfTRICK Penis A Mutual of Omaha Company Investments Since 1923 September 18, 2002 City of Dacono 512 Cherry Avenue Dacono, Colorado 80514 RE: Proposed Pinnacle Farms Metropolitan District To Whom It May Concern: As part of the service plan approval process, you have asked about the relationship between the investment bankers and the proposed Pinnacle Farms Metropolitan District. We are engaged with the petitioners of the proposed Districts as described by the attached Letter of Intent. We have the intention of serving as underwriters for the Districts' voter authorized debt once sufficient credit support can be identified based on assessed value or guarantees provided by the landowners. The structure represented in the financing plan involves non- rated bonds issued to a third party, which we believe will be marketable based on the growth assumptions also included in this plan. In this example, the debt would be sold to institutional investors. You also requested an explanation of the level of credit risk associated with the types of financing we are considering for this District. As with most start-up special districts, this District expects to market bonds to third parties to raise capital for infrastructure before the entire project is complete. The level of risk taken by a bondholder and the interest rate required for the financing, decrease as development occurs. Our recent special district underwritings vary from bonds sold at 8% with land in the District sold to builders and no homes constructed to refunding bonds issued with most of the homes built at interest rates of 5% with "AAA" rated insurance. In the case of "AAA" rated, insured bonds, the underlying Districts generally have debt/AV ratios of 50% or less. The interest rate assumptions contained in the Service Plan are reasonable based on _ current market conditions. Because the financing in these districts is intended to pay for public infrastructure, we issue bonds as close to the time the infrastructure is needed as possible. During the period of time when homes are being constructed but not yet on the tax rolls, the District is projected to meet its debt service obligation with capitalized interest. While this does increase the bondholders' risk, the 1600 BROADWAY,SUITE 1100•DENVER,CO 80202-4922•303-764-6000•800-942-7557•FAX 303-764-6002 HOME OFFICE:10250 REGENCY CIRCLE,SUITE 400•OMAHA,NE 68114•800.776-5777 Member NASD 8 SIPC•‘,/,.‘w kirkpatrickpettis.cam Kirkpatrick Pettis Page 2 of 2 — bondholders understand that risk and are compensated in the interest rate on the bonds. With regard to the City's risk, we know of no example where a City was implicated in a special district default and see no legal argument for such implication. We hope this letter helps to clarify the financing alternative represented in the financing plan and the current market for special district bonds. Please call if you have any questions or require further clarification. Sincer Thomas R. Bi hop Sa u a R. S'arp Senior Vice President Vic- 're rent — Cc: Scott Carlson EXHIBIT G Legal Counsel Letter ICENOGLE, NORTON, SMITH, T. Edward Icenogle BLIESZNER & MILLER Jennifer L. Gruber Charles E. Norton A Professional Corporation Kristin A. Decker Erin M.Smith Attorneys at Law Volpi Edward J. Blleszner 821 Philip G.17th Street,Suite 600 John Goutellutell Dianne D.Miller Denver, Colorado 80202-3040 Sara Wagers-Johnson Telephone(303)292-6400 Man D. Pogue '— Facsimile(303)292-6401 INSeinspc.com September 23, 2002 City of Dacono 512 Cherry Street Dacono, Colorado 80514 Re: Organization of the Pinnacle Farms Metropolitan District This firm has acted as counsel to the Petitioners in connection with the organization of the Pinnacle Farms Metropolitan District. Pursuant to the requirements of Article V.g. of the Service Plan for the District, this letter confirms that the petition for organization of the District tiled with the City on July 30, 2002, the Service Plan for the District, as approved on September 23, 2002, and the notice, hearing and other procedures in connection with the approval of the Service Plan, have met the requirements of the Special District Act, article 1 of title 32, C.R.S., and that the provisions of the Service Plah, including. without limitation, provisions as to the structure and terms of the District's bonds, fees and revenue sources, are consistent with applicable provisions of titles 11 and 32, C.R.S., and other applicable law. Please be advised, however, that this firm has not been engaged as bond counsel to the District, nor will this firm serve as bond counsel at any time for the District. This letter does not purport to offer any opinion of the type customarily required to be given by bond counsel with regard to any bond transaction of the District. This letter is limited to the use of the addressee as set forth above and may not be relied upon by other parties or in connection with any future sale, resale or transfer of bonds and may be relied upon only as stated herein. This letter may not be used, quoted or referred to, in whole or in part, for any other purpose without the prior, written consent of the firm ICENOGLE, NORTON, SMITH, BLIESZNER & MILLER A Professional Corpor n 1C EXHIBIT H Part I—Developer Indemnity Letter Part 2 Form of District Indemnity Letter September 20, 2002 City of Dacono 512 Cherry Street Dacono, Colorado 80514 Re: Pinnacle Farms Metropolitan District Ladies and Gentlemen: This Indemnity Letter (the "Indemnity Letter") is delivered by the undersigned, Pinnacle Farms, LLC, a Colorado limited liability company (the "Developer"), in order to induce the City of Dacono (the "City") to approve the Service Plan, including all amendments heretofore or hereafter made thereto (the "Service Plan") for the Pinnacle Farms Metropolitan District (the "District"). In consideration of the City's approval of the Service Plan, the Developer, for and on behalf of itself and its transferees, successors and assigns, represents, warrants, covenants and agrees to and for the benefit of the City as follows: 1. The Developer hereby waives and releases any present or future claims it might have against the City or the City's elected or appointed officers, employees, agents or contractors in any manner related to or connected with the Service Plan or any action or omission with respect thereto. The Developer further hereby agrees to indemnify and • hold harmless the City and the City's elected and appointed officers, employees, agents and contractors, from and against any and all liabilities resulting from any and all claims, demands, suits, actions or other proceedings of whatsoever kind or nature made or brought by any third party, including attorney's fees and expenses and court costs, which directly or indirectly or purportedly arise out of or are in any manner related to or connected with any of the following: (a) the Service Plan or any document or instrument contained or referred to therein; or (b) the formation of the District or any actions or omissions of the Developer, the District, the City or any other person or entity in connection with the District, including, without limitation, any bonds or other financial obligations of the District or any offering documents or other disclosures made in connection therewith. The Developer further agrees to investigate, handle, respond to, and to provide defense for and defend against, or at the City's option to pay the attorney's fees and expenses for counsel of the City's choice for any such liabilities, claims,• demands, suits, actions or other proceedings. It is understood and agreed that the City does not waive or intend to waive the monetary limits (presently S150,000 per person and 5600,000 per occurrence) or any other rights, immunities and protections provided by the Colorado Governmental Immunity Act, § 24-10-101 et seq., C.R.S., as from time to time amended, or othenvise available to the City, its officers or its employees. 2 The Developer hereby consents to the City Disclaimer Statement contained in Exhibit "F' to the Service Plan, acknowledges the City's right to modify the City Disclaimer Statement and waives and releases the City from any claims the Developer might have based on or relating to the use of or any statements made or to be made in such City Disclaimer Statement (including any modifications thereto). 3. It is understood and agreed, and the Developer hereby expressly acknowledges, that the City, in acting to approve the Service Plan, has relied upon the provisions of this Indemnity Letter. 4. This Indemnity Letter has been duly authorized and executed on behalf of the Developer. Very truly yours, Pinnacle Farms, LLC, a Colorado limited liability company Crjnitki .HCA.Cbefn By: Its: Pinnacle Farm..lSvc Plan K 40122 IM]11 IXM13 [Date of Organizational Meeting] City of Dacono 512 Cherry Street Dacono, Colorado 80514 Re: Pinnacle Farms Metropolitan District Ladies and Gentlemen: This Indemnity Letter (the "Indemnity Letter") is delivered by the Pinnacle Farms Metropolitan District (the "District") in order to comply with the Service Plan, including all amendments heretofore or hereafter made thereto (the "Service Plan") for the District. In consideration of the City's approval of the Service Plan, the District, for and on behalf of itself and its transferees, successors and assigns, represents, warrants, covenants and agrees to and for the benefit of the City as follows: I. The District hereby waives and releases any present or future claims it might have against the City or the City's elected or appointed officers, employees, agents or contractors in any manner related to or connected with the Service Plan or any action or omission with respect thereto. To the fullest extent permitted by law, the District hereby agrees to indemnify and hold harmless the City and the City's elected and appointed officers, employees, agents and contractors, from and against any and all liabilities resulting from any and all claims, demands, suits, actions or other proceedings of whatsoever kind or nature made or brought by any third party, including attorney's fees and expenses and court costs, which directly or indirectly or purportedly arise out of or are in any manner related to or connected with any of the following: (a) the Service Plan or any document or instrument contained or referred to therein; or (b) the formation of the District or any actions or omissions of the District, the City, Pinnacle Farms LLC. or any other person or entity in connection with the District, including, without limitation, any bonds or other financial obligations of the District or any offering documents or other disclosures made in connection therewith. The District further agrees w investigate, handle, respond to. and to provide defense for and defend against, or at the City's option to pay the attorney's fees and expenses for counsel of the City's choice for, any such liabilities, claims, demands, suits, actions or other proceedings. It is understood and agreed that neither the District nor the City waives or intends to waive the monetary limits (presently $150,000 per person and $600,000 per occurrence) or any other rights, immunities, and protections provided by the Colorado Governmental Immunity Act, § 24-10-101 et seq., C.R.S., as from time to time amended, or otherwise available to the City. the District, its officers, or its employees. 2. The District hereby consents to the City Disclaimer Statement contained in Exhibit "J" to the Service Plan; agrees that the District will include such City Disclaimer Statement or any modified or substitute City Disclaimer Statement hereafter furnished by the City to the District in all offering materials used in connection with any bonds or other financial obligations of the District (or. if no offering materials are used, the City Disclaimer Statement will he given by the District to any prospective purchaser of any bonds or other financial obligations of the District); and naives and releases the City from any claims the District might have based on or relating to the use of or am statements made or to be made in such City Disclaimer Statement (including any modifications thereto). 3. It is understood and agreed, and the District hereby expressly acknowledges, that the City, in acting to approve the Service Plan, has relied upon the provisions of this Indemnity Letter. 4. This Indemnity Letter has been duly authorized and executed on behalf of the District. Very truly yours, PINNACLE FARMS METROPOLITAN DISTRICT By: Title: EXHIBIT I Form of Disclosure Notice � bn / g5— c1�<�� Ct/',26/- C2) y Pinnacle Farms Metropolitan District CITY OF DACONO WELD COUNTY,COLORADO DISCLOSURE STATEMENT Pursuant to Article XII of the Service Plan of Pinnacle Farms Metropolitan District DISTRICT ORGANIZATION: Pinnacle Farms Metropolitan District (the "District"), Dacono, Weld County, Colorado is a quasi-municipal corporation and political subdivision of the State of Colorado duly organized and existing as a metropolitan district pursuant to Title 32, Colorado Revised Statutes. The District was declared organized and an existing metropolitan district on , 2002, pursuant to an Order and Decree Organizing the District and Issuance of Certificates of Election for the Pinnacle Farms Metropolitan District, issued in the District Court of Weld County, Colorado. The Order and Decree was recorded in the records of the Weld County Clerk and Recorder on 2002 at Reception # The District is located entirely within the corporate limits of the City of Dacono, Colorado. in Weld County. The legal description of the property forming the boundaries of the District is described in Exhibit A. DISTRICT PURPOSE: Pinnacle Farms Metropolitan District was organized for the purpose of financing street, traffic safety control, water, sanitary sewer, storm drainage and park and recreation public improvements, all in accordance with its Service Plan approved by the City Council of Dacono. When completed, improvements shall be dedicated to the City of Dacono, Central Weld County Water District, St. Vrain Sanitation District or other non-profit or governmental entities, all for the use and benefit of residents and taxpayers, except to the extent that tract landscaping, stomi drainage improvements, park and recreation improvements and trail systems may, upon the City of Dacono's direction or consent, be retained by the District for operation and maintenance or operated and maintained by contract with a homeowners' association formed for the Pinnacle Farms subdivision. The District's Service Plan is on file and available for review at the office of the District, and at the office of the City Clerk, City of Dacono. 512 Cherry St, Dacono, Colorado 80514. TAX LEVY INFORMATION: The primary source of revenue for the District is ad valorem property taxes. Property taxes are determined annually by the District's Board of Directors and set by the Board of County Commissioners for Weld County as to rate or levy based upon the assessed valuation of the property within the District. The levy is expressed in teems of mills. A mill is 1/1,000 of the assessed valuation, and a levy of one mill equals SI of tax for each 51,000 of assessed value. The financial forecast for the District (as set forth in its Service Plan) assumes that the District will be able to set its tax levy at approximately thirty-five (35) mills for 2004 through 2039 for debt service, maintenance and administration purposes. Except for certain adjustments permitted by the Service Plan to compensate for legally required changes in residential valuation ratios, the District shall not impose a mill levy in excess of fifty (50) mills. District taxes are collected as part of the property tax bill from Weld County. PINNACLE FARMS METROPOLITAN DISTRICT By: , President STATE OF COLORADO ) ss. COUNTY OF The foregoing instrument was acknowledged before me this day of . 200 , by as President of the Pinnacle Farms Metropolitan District. WITNESS my hand and official seal. My commission expires: Notary Public EXHIBIT A (Legal Description of District) SERVICE DISTRICT BOUNDARY BEING A PART OF THE EAST ONE-HALF OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN, TOWN OF DACONO, COUNTY OF WELD, STATE OF COLORADO, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: _ BASIS OF BEARINGS: THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN CONSIDERED TO BEAR S00°11'04"E WITH ALL BEARINGS HEREIN RELATIVE THERETO. COMMENCING AT THE EAST ONE-QUARTER CORNER OF SAID SECTION 2, THENCE S89°43'30"W, A DISTANCE OF 30.01 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 11 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO, SAID POINT BEING THE POINT OF BEGINNING; THENCE S00°11'04"E ALONG A LINE PARALLEL WITH AND 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,619.96 FEET TO A POINT ON THE - NORTHERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 12 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE S89°34'18"W ALONG A LINE PARALLEL WITH AND 30.00 FEET NORTHERLY OF THE SOUTH LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,604.89 FEET TO A POINT ON THE WEST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2; THENCE N00°06'16"E ALONG THE WEST LINE OF THE SOUTHEAST ONE- QUARTER OF SAID SECTION 2, A DISTANCE OF 2,627.31 FEET TO THE CENTER ONE-QUARTER CORNER OF SAID SECTION 2; THENCE N00°06'11"E ALONG THE WEST LINE OF THE NORTHEAST ONE- _ QUARTER OF SAID SECTION 2, A DISTANCE OF 50.85 FEET; THENCE ALONG THE FOLLOWING TWENTY-ONE (21) COURSES: 1. S89°53'49"E, A DISTANCE OF 130.11 FEET TO AN ARC OF A CURVE; \\Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010\Legals\Service district bndy.doc Page 1 of 4 2. ALONG AN ARC OF A CURVE TO THE RIGHT, THE CENTER BEARS S74°18'38"E, HAVING A DELTA OF 17°13'32", A RADIUS OF 275.00 FEET AND ARC LENGTH OF 82.68 FEET TO A POINT OF TANGENCY; 3. N32°54'54"E, A DISTANCE OF 132.66 FEET; 4. S57°05'06"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; 5. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS S57°05'06"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; _ 6. S57°05'06"E, A DISTANCE OF 26.34 FEET TO A POINT OF CURVATURE; 7. ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 32°58'46", A RADIUS OF 325.00 FEET AND ARC LENGTH OF 187.07 FEET TO A POINT OF TANGENCY; 8. N89°56'08"E, A DISTANCE OF 535.49 FEET TO A POINT OF CURVATURE; 9.' ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 10. N00°03'52"W, A DISTANCE OF 10.00 FEET; 11. N89°56'08"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; 12. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS N89°56'08"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 13. N89°56'08E, A DISTANCE OF 294.78 FEET; 14. N00°16'04"W, A DISTANCE OF 115.15 FEET; 15. N33°55'09"E, A DISTANCE OF 154.12 FEET; 16. N00°03'52"W, A DISTANCE OF 1,525.03 FEET; 17. N30°43'25"E, A DISTANCE OF 80.00 FEET; Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010\Legals\Service district bndy.doc Page 2 of 4 18. S59°16'35"E, A DISTANCE OF 129.36 FEET; 19. N30°43'25"E, A DISTANCE OF 60.78 FEET; 20. N64°59'29"E, A DISTANCE OF 118.22 FEET; 21.N30°03'07"E, A DISTANCE OF 685.68 FEET TO A POINT ON THE SOUTHERLY RIGHT-OF-WAY OF COLORADO STATE HIGHWAY NO. 52 AS RECORDED IN BOOK 1552, PAGE 142 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE ALONG SAID SOUTHERLY RIGHT-OF-WAY LINE OF COLORADO STATE HIGHWAY NO. 52 THE FOLLOWING TWO (2) COURSES: 1. N89°49'47"E, A DISTANCE OF 371.63 FEET; 2. S44°59'13"E, A DISTANCE OF 136.30 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 11; THENCE S00°03'52"E ALONG A LINE PARALLEL WITH AND 30.00 FEET _ WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,485.84 FEET TO THE POINT OF BEGINNING. CONTAINING 9,563,870 SQUARE FEET OR 219.556 ACRES MORE OR LESS. LEGAL DESCRIPTION STATEMENT I, RONALD LEE POWERS, A PROFESSIONAL LAND SURVEYOR IN THE STATE OF COLORADO, DO HEREBY STATE THAT THE ABOVE LEGAL DESCRIPTION AND ATTACHED EXHIBIT WAS PREPARED UNDER MY RESPONSIBLE CHARGE, AND ON THE BASIS OF MY KNOWlig, ��, INFORMATION AND BELIEF IS CORRECT. %% . L . 4 O . _! 411 • RONALD LEE POWERS, PROFESSIONAL LAND SURV " • 7� • COLORADO NO. 16427 ., +��s 4) A&R LAND SURVEYING, LLC. . 224 POTOMAC STREET, SUITE 102 •.,,OpCOLO„" AURORA, COLORADO 8OO11 %%~0000000�, \',Compaq 5wv294\c\SDSIC\PROACurrent Projects\ar0010\Legals\Service district bndy.doc Page 3 of 4 EXHIBIT J Fomi of City Disclaimer Statement CITY OF DACONO, COLORADO - DISCLAIMER STATEMENT As a requirement imposed in its formation process, the Pinnacle Farms Metropolitan District (the "District") is obligated to the City of Dacono (the "City") to include this disclaimer statement in all offering materials used in connection with any bonds or other financial _ obligations of the District (or, if no offering materials are used, to give this disclaimer statement to any prospective purchaser, investor or lender in connection with any such bonds or other financial obligations of the District). The date of this disclaimer statement is The City has not reviewed or participated in the preparation of any offering materials or any other documentation relating to any bonds or financial obligations of the District or to any other materials to which this Disclaimer Statement is appended, and other than this Disclaimer Statement, no other statement of any kind is authorized to be made by or on behalf of the City in connection with any bonds or other financial obligations of the District. The Cit} and the District are separate legal entities. The City is not a party to and is not obligated with respect to any borrowings, financings. bonds or other financial obligations of the District. As a statutory requirement for the formation of the District, the City approved a Service Plan containing financial and other information furnished by the District's organizers. The City's approval of the Service Plan was based upon such information furnished by the District's organizers, without independent investigation by the City. The District's Service Plan was prepared in 2002 and not in connection with the offering of any bonds or other financial obligations. The City's approval of the District's Service Plan should not be relied upon by prospective purchasers, investors or lenders in evaluating the investment quality of the District's bonds or other financial obligations. The Service Plan and related agreements do not impose upon the City any duties to, nor confer any rights against the City upon, any purchasers, lenders, investors, bondholders or other third parties. EXHIBIT I< Form of Interuovernmental Agreement Between District and City INTERGOVERNMENTAL AGREEMENT BETWEEN THE CITY OF DACONO, COLORADO AND PINNACLE FARMS METROPOLITAN DISTRICT THIS AGREEMENT is made and entered into as of this day of , 2002, by and between the City of Dacono, a home-rule municipal corporation of the State of Colorado (the "City"). and Pinnacle Farms Metropolitan District, a quasi-municipal corporation and political subdivision of the State of Colorado (the "District"). RECITALS WHEREAS. the District was organized to provide those services and to exercise powers as are more specifically set forth in the District's Service Plan dated 200_, as revised, and approved by the City on , 2002, by Resolution No. ("Service Plan"); WHEREAS, the Service Plan makes reference to and requires the execution of an intergovernmental agreement between the City and the District; and WHEREAS. the City and the District have determined it to be in the best interests of their respective taxpayers, residents and property owners to enter into this Intergovernmental Agreement (the "Agreement"). NOW, THEREFORE, for and in consideration of the covenants and mutual agreements herein contained. and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: COVENANTS AND AGREEMENTS I. Application of Local Laws. The District hereby acknowledges that the property within its boundaries shall be subject to all ordinances, rules and regulations of the City. including without limitation, ordinances, rules and regulations relating to zoning, subdividing, building and land use, and to all related City land use policies, master plans, related plans and intergovernmental agreements. 2. Nature of District. The District agrees that it is organized for the purpose of financing certain public improvements for the area within its boundaries only, which area is designated as the proposed Pinnacle Farms development, and that the District's purposes, powers. facilities and activities are to be limited and governed by the Service Plan. The District is not intended to and shall not provide service outside its boundaries. Further, the District is not intended to and shall not exist perpetually, but instead shall be dissolved in accordance with the Service Plan and this Agreement. The Property within the District will receive water service from the City through the City's arrangements with the Central Weld County Water District. The District shall not provide any services or facilities within any area of the District overlapping with the service area of another district without first obtaining the written consent of each and every district whose service area is so overlapped. 3. Change in Boundaries. The District agrees that, as set forth in the Service Plan, T inclusion of properties within, or any exclusion of properties from, its boundaries shall be subject to the prior written approval of the City Council of the City as evidenced by a resolution. Any inclusion or exclusion that has been given such prior written approval by the City shall not constitute a material modification of the Service Plan; any purported inclusion or exclusion that has not been so approved shall be void and of no effect. 4. Review of District Submittals. The District agrees to reimburse the City for all reasonable administrative and consultant costs incurred by the City for any City review of reports, plans, submittals or other materials or requests provided to the City by the District pursuant to the Service Plan, state law or the Dacono Municipal Code. The City may require a deposit of such estimated costs. 5. Ownership of Improvements. The parties agree that the District shall not be permitted to undertake ownership, operation or maintenance of public facilities and services, except as specifically set forth in the Service Plan. 6. Consolidation. The District shall not file a request with the district court to consolidate with another district without the prior written approval of the City. 7. Dissolution. The District agrees that it shall take all action necessary to dissolve the District upon payment or defeasance of the District's bonds or upon the request of the City, all as provided in the Service Plan. 8. Notice of Meetings. The District agrees that it shall submit a copy of the written notice of every regular, special meeting and work session of the District's Board of Directors to the Office of the Dacono City Administrator, by mail, facsimile or hand delivery, to be received at least three (3) days prior to such meeting. The District agrees that it shall also submit a complete copy of meeting packet materials for any such meeting to the Office of the Dacono City Administrator, by mail, facsimile or hand delivery, to be received at least one (I) day prior to such meeting. 9. Annual Report. The District shall be responsible for submitting an annual report to the City pursuant to and including the information set forth in Section VII of the Service Plan. I U. Entire Agreement of the Parties. This written Agreement constitutes the entire agreement between the parties and supersedes all prior written or oral agreements, negotiations or representations and understandings of the parties with respect to the subject matter contained herein. l L Amendment. This Agreement may be amended, modified, changed or terminated in whole or in part only by a written agreement duly authorized and executed by the parties hereto and without amendment to the Service Plan. 12. Enforcement. The parties agree that this Agreement may be enforced in law or in equity for specific performance, injunctive or other appropriate relief, including damages, as may be available according to the laws and statutes of the State of Colorado. 13. Venue. Venue for the trial of any action arising out of any dispute hereunder shall be in the appropriate district court of the State of Colorado pursuant to the appropriate rules of civil procedure. 14. Beneficiaries. Except as otherwise stated herein, this Agreement is intended to describe the rights and responsibilities of and between the named panics and is not intended to, and shall not be deemed to confer any rights upon any persons or entities not named as parties. 15. Effect of Invalidity. If any portion of this Agreement is held invalid or unenforceable for any reason by a court of competent jurisdiction as to either party or as to both parties, such portion shall be deemed severable and its invalidity or its unenforceability shall not cause the entire Agreement to be terminated. Further, with respect to any portion so held invalid or unenforceable, the District and City agree to take such actions as may be necessary to achieve to the greatest degree possible the intent of the affected portion. 16. Assignability. Other than as specifically provided for in this Agreement, neither the City'nor the District shall assign their rights or delegate their duties hereunder without the prior written consent of the other parties. 17. Successors and Assigns. Subject to Section 16 hereof, this Agreement and the rights and obligations created hereby shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. PINNACLE FARMS METROPOLITAN DISTRICT By: President ATTEST: By: Secretary CITY OF DACONO By: Its: ATTEST: By: Its: EXHIBIT L Resolution of the City of Dacono Approving the Service Plan CITY OF DACONO, COUNTY OF WELD, STATE OF COLORADO IN RE THE ORGANIZATION OF PINNACLE FARMS METROPOLITAN DISTRICT, IN THE CITY OF DACONO, COUNTY OF WELD, STATE OF COLORADO RESOLUTION NO. 02-54 RESOLUTION OF APPRQVAL WHEREAS, pursuant to the provisions of Title 32, Article 1, Part 2, C.R.S. as amended, the City Council of the City of Dacono, County of Weld, State of Colorado, following due notice, held a public hearing on the Service Plan of the proposed Pinnacle Farms Metropolitan District on the 23rd day of September, 2002; and WHEREAS, the City Council has considered the Service Plan and all other testimony and evidence presented at the hearing; and WHEREAS, based upon the testimony and evidence presented at the hearing, it appears that the Service Plan should be approved by the City Council, subject to certain conditions set forth below, in accordance with Section 32-1-204.5(1)(c), C.R.S. THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DACONO, COLORADO: Section 1. That the City Council, as the governing body of the City of Dacono, Colorado, does hereby determine, based on representations by and on behalf of Pinnacle Farms LLC, a Colorado limited liability company (the "Developer"), that all of the requirements of Title 32, Article I, Part 2, C.R.S., as amended, relating to the filing of a Service Plan for the proposed Pinnacle Farms Metropolitan District have been fulfilled and that notice of the hearing was given in the time and manner required by the City. Section 2. That, based on representations by and on behalf of the Developer, the City Council of the City of Dacono, Colorado, has jurisdiction over the subject matter of this proposed special district pursuant to Title 32, Article 1, part 2, C.R.S., as amended. Section 3. That, pursuant to Section 32-1-204.5, C.R.S., Section 32-1-202(2), C.R S., and Section 32-1-203(2), C.R.S., the City Council of the City of Dacono, Colorado, does hereby find and determine, based on the Service Plan and other evidence presented by and on behalf of the Developer, that: 1 (a) There is sufficient existing and projected need for organized service in the area to be serviced by the proposed District: (b) The existing service in the area to be served by the proposed District is inadequate for present and projected needs; (c) The proposed special district is capable of providing economical and sufficient service to the area within its proposed boundaries; (d) The area to be included in the proposed District has, or will have, the financial ability to discharge the proposed indebtedness on a reasonable basis; and • (e) The creation of the proposed District will be in the best interests of the area proposed to be served. Section 4. That pursuant to Section 32.1-204.5(1)(c), C.R.S., the City Council hereby imposes the following conditions upon its approval of the Service Plan: (a) The Developer agrees that the City Attorney will be given reasonable notice of all proceedings in the District Court of Weld County relating to the organization of the District (including notice as described in Section 32-1-304, C.R.S.). (b) The Developer agrees that, prior to the hearing date set by the District Court of Weld County pursuant to Section 32-1-304, C.R.S., all fees and expenses which have been submitted to the Developer for payment by or on behalf of the City or its attorneys or financial or other advisors shall have been paid in full. (c) Prior to the hearing date set,by the District Court of Weld County pursuant to Section 32-1-304, C.R.S., the District shall fully comply with the provisions of Section 32-1-107(3), C.R.S. with respect to the overlapping of service areas. The District's authorization to provide services or facilities within any overlapping area is expressly conditioned upon the District first obtaining the written consent of each and every district whose service area is so overlapped. (d) Prior to the Mayor's execution of this Resolution, the fully and properly executed originals of the engineer's statement of reasonableness of capital 2 costs; accountant's letter and forecasts; letters in support of market projections and absorption rates; underwriter's letter; legal counsel letter; Developer's indemnity letter; and property owners' consents that are required under the Service Plan and set forth in Exhibits C, E, F, G, M and Part I of Exhibit H thereto, shall be provided to the City. (e) At its organizational meeting, the District shall execute the District indemnity letter and intergovernmental agreement with the City that are required under the Service Plan and set forth in Part 2 of Exhibit H and Exhibit K thereto, and shall provide the fully executed originals of such documents to the City. If any of the above-stated conditions (a) through (d) are not met, the City may file a motion with the District Court of Weld County requesting that the hearing on the organization of — the District be delayed until such conditions are met, and Developer has represented that it will not oppose such motion. Further, if any of the above-stated conditions (a) through (e) are not met, the City may pursue all legal and equitable remedies available to it for failure of compliance with such conditions of approval. Section 5. That the Service Plan of the proposed Pinnacle Farms Metropolitan District, as set forth in Exhibit A to this Resolution and dated September 20, 2002, is hereby approved subject to the conditions stated in Section 4 above, in accordance with Section 32-1-204.5(1)(c), • C.R.S., and subject to the revisions set forth in Exhibit B. Section 6. That a certified copy of this Resolution be filed in the records of the City of Dacono and submitted to the Developer for the purpose of filing in the District Court of Weld County for further proceedings concerning the District. — RESOLVED, ADOPTED AND APPROVED this 23rd day of September, 2092. CITY COUNCIL, ��,.a�"�en,y� CITY OF DACONO, COLORADO 0 pc (SEAL) :'��k.p a iii\ ()litr�.� ��G'rll. t> C�. ATTEST: .* SEAL *E. Wade Carbon : 49 00 Mayor • Fri e Nanc Elliot ""',` ' City Clerk 3 - CERTIFICATE I, Nancy Elliott, do hereby certify that the above and foregoing is a true, correct and complete ccpy of a resolution adopted by the City Council of the City of Dacono, Colorado, at a public meeting held on the 23rd day of September, 2002. IN WITNESS WHEREOF, I have hereunto set my hand and the seal of the City of Dacono, Colorado, this IQ_day of October, 2002. �ppmp �s 1F7 4 SEAL City C — i 1*: * ‹�V!9„"�� 00 �nJ "' p h �WaeoRanetWnoelapomuWppmsRwoWuan(644 tit CkORPC3.1 'sum lllllllll EXHIBIT B REVISIONS TO PINNACLE FARMS METROPOLITAN DISTRICT SERVICE PLAN (Dacono City Council Meeting, September 23, 2002) 1. Page 2, line 4, insert "written" between"prior" and "approval." 2. Page 4, line 15, insert"written" between"prior" and "approval." 3. Page 15, line 17, change"obligation" to "obligations." 4. Page 18, line 3, insert the following at the end of the second paragraph of Section V.b(2): "If actual increases in District assessed valuation attributable to inflation and biennial revaluation factors are less than the projected increases for those factors as shown in the Exhibit E forecasts, it is expected that the District would compensate by increasing its mill levy (subject to the Limited Mill Levy). It is expected that any such increase in the projected mill levy to compensate for _ decreased inflation and revaluation factors would not exceed approximately additional mills." 5. Page 21, add new final phrase to last sentence, as follows (new words underlined: "...Developer Bonds, and shall comply with the above-stated limitations restrictions and requirements regarding Developer bonds." 6. Page 24, line 18, delete ", fees". 7. Page 27, line 23, insert "without limitation" after"including". 8. Page 30, line 14, insert "purchasers, lenders, investors," between "any" and "bondholders". 9. Exhibit E, Note 10 of Accountant's Notes, correct number in line 2 to updated cost estimate. 10. Exhibit E, letters in support of market projections: the letters must be revised so that the developer and market projection consultant each expressly state their opinion as to the reasonableness of the market absorption projections upon which the financial plan (i.e., the spreadsheets) is based. II. Add language clarifying that the District is authorized only to finance Water District improvements or facilities. This language shall be approved by the City Administrator and City Attorney prior to its inclusion in the final service plan. 5 EXHIBIT NI Property O‘'.ners' Consent September 20, 2002 City of Dacono 512 Cherry Street Dacono CO 80514 Re: Proposed Pinnacles Farms Metropolitan District ("District") To Whom It May Concern: Jeanie D. McDonald-Carlson, Kent D. Carlson, Lisa Duke Carlson, Lee S. — Carlson and Ryan L. Carlson are the owners of the property attached hereto as Exhibit A, which property is proposed to constitute the boundaries of the District. The purpose of this letter is to advise that the property owners consent to the organization of the District. Q\sc, ‘if\ko.ka, Cocc&i _ JEANIE D. MC ALD-CARLSON _ D. CARL N LI'AD R O • - a / AR RYAN L. CARLSON STATE OF COLORADO ) 1)�� ) ss. COUNTY OF tit t ela-4- The foregoing document was acknowledged before me this day of September 2002, by Jeanie D. McDonald-Carlson, Kent D. Carlson, Lisa Duke Carlson, Lee S. Carlson and Ryan L. Carlson. WITNESS my hand and official seal. r1`ttii�///CO _ N0TA• P,y Notar ublic =*' fl '^r tlis;.. j°USL‘0 ;lp My Commission Expires: My Commission Expires %q9TF As• ••.. ..•, 02/09/2004 ��gpOll nloi0��\\\\` EXHIBIT A SERVICE DISTRICT BOUNDARY BEING A PART OF THE EAST ONE-HALF OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN, TOWN OF DACONO, COUNTY OF WELD, STATE OF COLORADO, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BASIS OF BEARINGS: THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SECTION 2, TOWNSHIP 1 NORTH, RANGE 68 WEST OF THE 6TH PRINCIPAL MERIDIAN CONSIDERED TO BEAR S00°11'04"E WITH ALL BEARINGS HEREIN RELATIVE THERETO. COMMENCING AT THE EAST ONE-QUARTER CORNER OF SAID SECTION 2, THENCE S89°43'30"W, A DISTANCE OF 30.01 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 11 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO, SAID POINT BEING THE POINT OF BEGINNING; THENCE S00°11'04"E ALONG A LINE PARALLEL WITH AND 30.00 FEET WESTERLY OF THE EAST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,619.96 FEET TO A POINT ON THE NORTHERLY RIGHT-OF-WAY OF WELD COUNTY ROAD NO. 12 AS RECORDED IN THE BOARD OF COUNTY COMMISSIONERS FOR WELD COUNTY IN BOOK 86, AT PAGE 273 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE S89°34'18"W ALONG A LINE PARALLEL WITH AND 30.00 FEET - NORTHERLY OF THE SOUTH LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,604.89 FEET TO A POINT ON THE WEST LINE OF THE SOUTHEAST ONE-QUARTER OF SAID SECTION 2; THENCE N00°06'16"E ALONG THE WEST LINE OF THE SOUTHEAST ONE- QUARTER OF SAID SECTION 2, A DISTANCE OF 2,627.31 FEET TO THE CENTER ONE-QUARTER CORNER OF SAID SECTION 2; THENCE N00°06'11"E ALONG THE WEST LINE OF THE NORTHEAST ONE- - QUARTER OF SAID SECTION 2, A DISTANCE OF 50.85 FEET; THENCE ALONG THE FOLLOWING TWENTY-ONE (21) COURSES: 1. S89°53'49"E, A DISTANCE OF 130.11 FEET TO AN ARC OF A CURVE; \`Compaq 5wv294\c\SDSK\PROJ\Current Projects`ar0010\Legals'Service district bndy.doc Page 1 of 4 2. ALONG AN ARC OF A CURVE TO THE RIGHT, THE CENTER BEARS S74°18'38"E, HAVING A DELTA OF 17°13'32", A RADIUS OF 275.00 FEET AND ARC LENGTH OF 82.68 FEET TO A POINT OF TANGENCY; 3. N32°54'54"E, A DISTANCE OF 132.66 FEET; 4. S57°05'06"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; 5. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS S57°05'06"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 6. S57°05'06"E, A DISTANCE OF 26.34 FEET TO A POINT OF CURVATURE; 7. ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 32°58'46", A RADIUS OF 325.00 FEET AND ARC LENGTH OF 187.07 FEET TO A POINT OF TANGENCY; 8. N89°56'08"E, A DISTANCE OF 535.49 FEET TO A POINT OF CURVATURE; 9. ALONG AN ARC OF A CURVE TO THE LEFT HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 10. N00°03'52"W, A DISTANCE OF 10.00 FEET; 11. N89°56'08"E, A DISTANCE OF 50.00 FEET TO AN ARC OF A CURVE; - 12. ALONG AN ARC OF A CURVE TO THE LEFT, PROLONGATION OF THE CENTER BEARS N89°56'08"E, HAVING A DELTA OF 90°00'00", A RADIUS OF 20.00 FEET AND ARC LENGTH OF 31.42 FEET TO A POINT OF TANGENCY; 13. N89°56'08E, A DISTANCE OF 294.78 FEET; 14. N00°16'04"W, A DISTANCE OF 115.15 FEET; 15. N33°55'09"E, A DISTANCE OF 154.12 FEET; • 16. N00°03'52"W, A DISTANCE OF 1,525.03 FEET; 17. N30°43'25"E, A DISTANCE OF 80.00 FEET; \\Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010`S.egals\Service district bndy.doc Page 2 of 4 18. S59°16'35"E, A DISTANCE OF 129.36 FEET; - 19. N30°43'25"E, A DISTANCE OF 60.78 FEET; 20. N64°59'29"E, A DISTANCE OF 118.22 FEET; 21.N30°03'07"E, A DISTANCE OF 685.68 FEET TO A POINT ON THE SOUTHERLY RIGHT-OF-WAY OF COLORADO STATE HIGHWAY NO. - 52 AS RECORDED IN BOOK 1552, PAGE 142 OF SAID OFFICIAL WELD COUNTY RECORDS, STATE OF COLORADO; THENCE ALONG SAID SOUTHERLY RIGHT-OF-WAY LINE OF COLORADO STATE HIGHWAY NO. 52 THE FOLLOWING TWO (2) COURSES: 1. N89°49'47"E, A DISTANCE OF 371.63 FEET; 2. S44°59'13"E, A DISTANCE OF 136.30 FEET TO A POINT 30.00 FEET WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2 BEING THE WESTERLY RIGHT-OF-WAY OF _ WELD COUNTY ROAD NO. 11; THENCE S00°03'52"E ALONG A LINE PARALLEL WITH AND 30.00 FEET WESTERLY OF THE EAST LINE OF THE NORTHEAST ONE-QUARTER OF SAID SECTION 2, A DISTANCE OF 2,485.84 FEET TO THE POINT OF • BEGINNING. CONTAINING 9,563,870 SQUARE FEET OR 219.556 ACRES MORE OR LESS. LEGAL DESCRIPTION STATEMENT I, RONALD LEE POWERS, A PROFESSIONAL LAND SURVEYOR IN THE STATE OF COLORADO, DO HEREBY STATE THAT THE ABOVE LEGAL DESCRIPTION AND ATTACHED EXHIBIT WAS PREPARED UNDER MY RESPONSIBLE CHARGE, AND ON THE BASIS OF MY KNOWLEDGE, INFORMATION AND BELIEF IS CORRECT. t��tottt""t P L s C toor RONALD LEE POWERS, PROFESSIONAL LAND SURVVCIR D4TEI COLORADO NO. 16427 �,'�4,7 2) o ti *= A&R LAND SURVEYING, LLC. '',fj�,, sunrp'po,: 224 POTOMAC STREET, SUITE 102 �'�.,;ttOF COO%%%%%% AURORA, COLORADO 80011 .,,,,,,C0ti,,�.o . \'Compaq 5wv294\c\SDSK\PROJ\Current Projects\ar0010\Legals\Service district bndy.doc Page 3 of 4 Hello