$3,295,700 city of newport beach assessment district …cdiacdocs.sto.ca.gov/2009-0979.pdf · new...

NEW ISSUE – BOOK-ENTRY ONLY RATINGS: S&P: “A”

In the opinion of Meyers, Nave, Riback, Silver & Wilson, a Professional Law Corporation, Bond Counsel, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming, among other things, the accuracy of certain representations and compliance with certain covenants, interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from State of California personal income taxes. In the further opinion of Bond Counsel, interest on the Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although Bond Counsel observes that such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Bonds. See “CONCLUDING INFORMATION – Tax Matters.”

$3,295,700 CITY OF NEWPORT BEACH

ASSESSMENT DISTRICT NO. 103 (G STREET/EAST BALBOA BOULEVARD/CHANNEL ROAD/OCEAN BOULEVARD)

LIMITED OBLIGATION IMPROVEMENT BONDS

Dated: Date of Delivery Due: September 2, as shown below

The City of Newport Beach Assessment District No. 103 (G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard) Limited Obligation Improvement Bonds (the “Bonds”) are limited obligations of the City of Newport Beach, California (the “City”), secured by special assessments on real property located within the City’s Assessment District No. 103 (the “District”).

The installation and construction of the District’s improvements and the levy of special assessments will be undertaken as provided by the Municipal Improvement Act of 1913. The Bonds are issued pursuant to provisions of the Improvement Bond Act of 1915 and a Bond Indenture, dated as of October 1, 2009 (the “Indenture”), by and between the City and U.S. Bank National Association, as Paying Agent (the “Paying Agent”).

The Bonds are being issued in book-entry form and, when issued, will be registered in the name of Cede & Co., as nominee of The Depository Trust Company, New York, New York. Purchasers of Bonds will not receive certificates representing their beneficial ownership thereof but will receive credit balances on the books of their respective nominees. The Bonds will not be transferable or exchangeable except for transfer to another nominee of The Depository Trust Company or as otherwise described herein. Individual purchases may be made in principal amounts of $5,000 and integral multiples thereof, except for one Bond (which shall be the Bond maturing in the first year of maturity) which shall include the amount by which the total aggregate principal amount of the Bonds exceeds the maximum integral multiple of $5,000.

Interest on the Bonds will be payable on March 2, 2010, and semiannually thereafter on each March 2 and September 2. Principal of and interest on the Bonds will be paid by the Paying Agent to Cede & Co., and such payments are expected to be disbursed to the beneficial owners of the Bonds through their nominees.

The Bonds are subject to redemption prior to maturity as described under “THE BONDS – Redemption” herein.

Under the provisions of the Improvement Bond Act of 1915, installments of principal and interest sufficient to meet annual debt service on the Bonds will be billed by the County of Orange (the “County”) to owners of property within the District against which there are unpaid assessments. Upon receipt by the Paying Agent from the City, these annual installments are to be paid into the Redemption Fund to be held by the Paying Agent and used to pay debt service on the Bonds as it becomes due.

Unpaid assessments constitute fixed liens on the lots and parcels assessed within the District and do not constitute a personal indebtedness of the respective owners of such lots and parcels. Accordingly, in the event of delinquency, proceedings may be had only against the real property securing the delinquent assessment. Thus, the value of land within the District is a critical factor in determining the investment quality of the Bonds.

The City will establish a Reserve Fund and deposit therein Bond proceeds in the amount of the Reserve Requirement to provide funds for payment of principal and interest on the Bonds in the event of any delinquent assessment installments. The City’s obligation to advance funds to the Redemption Fund as a result of delinquent installments is limited to the balance in the Reserve Fund. The City has covenanted to initiate judicial foreclosure in the event of a delinquency as described herein. See “SECURITY FOR THE BONDS – Covenant for Superior Court Foreclosure.”

______________________

MATURITY SCHEDULE on inside cover

______________________

Neither the faith and credit nor the taxing power of the City, the County, the State of California or any political subdivision thereof is pledged to the payment of the Bonds, and the payment thereof is not secured by any encumbrance, mortgage or other pledge of property of the City except the pledge of the assessments and moneys on deposit in the Redemption Fund and the Reserve Fund. The City has determined not to obligate itself to advance available funds from its treasury in the event of delinquencies in the payment of assessments.

This cover page contains certain information for quick reference only. It is not a summary of this issue. Investors must read the entire Official Statement, including, without limitation, “BOND OWNERS’ RISKS,” to obtain information essential to the making of an informed investment decision.

The Bonds are offered when, as and if issued subject to the approval of Meyers, Nave, Riback, Silver & Wilson, a Professional Law Corporation, Oakland, California, Bond Counsel. Certain matters will be passed upon for the City by the City Attorney and by McFarlin & Anderson LLP, Lake Forest, California, as Disclosure Counsel. It is anticipated that the Bonds will be available for delivery to The Depository Trust Company or its agent on or about October 14, 2009.

Dated: October 2, 2009

SOUTHWEST SECURITIES, INC.

MATURITY SCHEDULE

$3,295,700

CITY OF NEWPORT BEACH ASSESSMENT DISTRICT NO. 103

(G STREET/EAST BALBOA BOULEVARD/CHANNEL ROAD/OCEAN BOULEVARD) LIMITED OBLIGATION IMPROVEMENT BONDS

Base CUSIP® No. 651784†

Maturity September 2

Principal Amount

Interest Rate Yield Price

CUSIP® No.†

Maturity September 2

Principal Amount

Interest Rate Yield Price

CUSIP® No.†

2010 $190,700 1.500% 1.100% 100.350% PK0 2018 $220,000 3.625% 3.700% 99.433% PT1 2011 185,000 1.400 1.400 100.000 PL8 2019 230,000 3.750 3.850 99.181 PU8 2012 190,000 1.900 1.900 100.000 PM6 2020 235,000 3.875 3.950 99.338 PV6 2013 190,000 2.200 2.200 100.000 PN4 2021 245,000 4.000 4.000 100.000 PW4 2014 195,000 2.600 2.600 100.000 PP9 2022 255,000 4.000 4.050 99.498 PX2 2015 200,000 3.000 3.000 100.000 PQ7 2023 265,000 4.000 4.100 99.945 PY0 2016 205,000 3.200 3.250 99.691 PR5 2024 275,000 4.100 4.150 99.445 PZ7 2017 215,000 3.375 3.500 99.142 PS3

† CUSIP® A registered trademark of the American Bankers Association. Copyright © 1999-2009 Standard & Poor’s, a Division of The McGraw-Hill Companies, Inc. CUSIP® data herein is provided by Standard & Poor’s CUSIP® Service Bureau. This data is not intended to create a database and does not serve in any way as a substitute for the CUSIP® Service Bureau. CUSIP® numbers have been assigned by an independent company not affiliated with the City and are included solely for the convenience of the registered owners of the Bonds. The City is not responsible for the selection or uses of these CUSIP® numbers, and no representation is made as to their correctness on the Bonds or as included herein. The CUSIP® number for a specific maturity is subject to being changed after the issuance of the Bonds as a result of various subsequent actions including, but not limited to, a refunding, in whole or in part, or as a result of the procurement of secondary market portfolio insurance or other similar enhancement by investors that is applicable to all or a portion of certain maturities of the Bonds.

CITYOFNEWPORTBEACH

MAYOR AND CITY COUNCIL

Edward D. Selich, Mayor, District 5Keith D. Curry, Mayor Pro Tem, District 7

Michael F. Henn, District 1Steven Rosansky, District 2

Don Webb, District 3Leslie Daigle, District 4

Nancy Gardner, District 6

CITY STAFFDavid Kiff, City Manager

David R. Hunt, Esq., City AttorneyLeilani Brown, City Clerk

Dennis Danner, Director of Administrative ServicesDan Matusiewicz, Finance Officer

Stephen Badum, Public Works DirectorDavid Webb, City Engineer

BOND COUNSELMeyers, Nave, Riback, Silver & Wilson,

a Professional Law CorporationOakland, California

FINANCIAL ADVISORFieldman, Rolapp & Associates

Irvine, California

ASSESSMENT ENGINEERHarris & Associates

Irvine, California

PAYING AGENTU.S. Bank National Association

Los Angeles, California

DISCLOSURE COUNSELMcFarlin & Anderson LLP

Lake Forest, California

UNDERWRITERSouthwest Securities, Inc.

Encino, California

DISSEMINATION AGENTDigital Assurance Certification, L.L.C.

Orlando, Florida

GENERAL INFORMATION ABOUT THE OFFICIAL STATEMENT

Use of Official Statement. This Official Statement is submitted in connection with the offer andsale of the Bonds referred to herein and may not be reproduced or used, in whole or in part, for any otherpurpose. This Official Statement is not to be construed as a contract with the purchasers of the Bonds.

Estimates and Forecasts. When used in this Official Statement and in any continuing disclosureby the City, in any press release and in any oral statement made with the approval of an authorized officerof the City or any other entity described or referenced herein, the words or phrases “will likely result,”“are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “forecast,” “expect,” “intend”and similar expressions identify “forward-looking statements” within the meaning of the PrivateSecurities Litigation Reform Act of 1995, Section 21E of the United States Securities Exchange Act of1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Suchstatements are subject to risks and uncertainties that could cause actual results to differ materially fromthose contemplated in such forward-looking statements. Any forecast is subject to such uncertainties.Inevitably, some assumptions used to develop the forecasts will not be realized and unanticipated eventsand circumstances may occur. Therefore, there are likely to be differences between forecasts and actualresults and those differences may be material. The information and expressions of opinion herein aresubject to change without notice, and neither the delivery of this Official Statement nor any sale madehereunder shall, under any circumstances, give rise to any implication that there has been no change in theaffairs of the City or any other entity described or referenced herein since the date hereof. The City doesnot plan to issue any updates or revision to the forward-looking statements set forth in this OfficialStatement.

Limited Offering. No dealer, broker, salesperson or other person has been authorized by the Cityto give any information or to make any representations in connection with the offer or sale of the Bondsother than those contained herein and if given or made, such other information or representation must notbe relied upon as having been authorized by the City or the Underwriter. This Official Statement does notconstitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the Bonds by aperson in any jurisdiction in which it is unlawful for such person to make such an offer, solicitation orsale.

Involvement of Underwriter. The Underwriter has submitted the following statement forinclusion in this Official Statement: The Underwriter has reviewed the information in this OfficialStatement in accordance with, and as a part of, its responsibilities to investors under the federal securitieslaws as applied to the facts and circumstances of this transaction, but the Underwriter does not guaranteethe accuracy or completeness of such information. The information and expressions of opinions hereinare subject to change without notice and neither delivery of this Official Statement nor any sale madehereunder shall, under any circumstances, create any implication that there has been no change in theaffairs of the City or any other entity described or referenced herein since the date hereof. All summariesof the documents referred to in this Official Statement are made subject to the provisions of suchdocuments, respectively, and do not purport to be complete statements of any or all of such provisions.

Stabilization of Prices. In connection with this offering, the Underwriter may over allot or effecttransactions which stabilize or maintain the market price of the Bonds at a level above that which mightotherwise prevail in the open market. Such stabilizing, if commenced, may be discontinued at any time.The Underwriter may offer and sell the Bonds to certain dealers and others at prices lower than the publicoffering prices set forth on the cover page hereof and said public offering prices may be changed fromtime to time by the Underwriter.

THE BONDS HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,AS AMENDED, IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATIONREQUIREMENTS CONTAINED IN SUCH ACT. THE BONDS HAVE NOT BEEN REGISTEREDOR QUALIFIED UNDER THE SECURITIES LAWS OF ANY STATE.

TABLE OF CONTENTS

PAGE

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INTRODUCTION.....................................................................................................................................1

THE FINANCING PLAN .........................................................................................................................1Purpose of the Bonds ..........................................................................................................................1Sources and Uses of Funds..................................................................................................................2

THE BONDS ............................................................................................................................................2Authority for Issuance.........................................................................................................................2Description of the Bonds .....................................................................................................................2Redemption.........................................................................................................................................3Improvement Fund..............................................................................................................................4Redemption Fund................................................................................................................................5Reserve Fund ......................................................................................................................................5Rebate Fund........................................................................................................................................6Investments.........................................................................................................................................6Annual Debt Service ...........................................................................................................................7

SECURITY FOR THE BONDS ................................................................................................................7General ...............................................................................................................................................7Reserve Fund ......................................................................................................................................8Covenant for Superior Court Foreclosure ............................................................................................8Covenant to Maintain Tax-Exempt Status..........................................................................................10Assessments Create a Lien ................................................................................................................10Limited City Obligation Upon Delinquency ......................................................................................10

THE DISTRICT......................................................................................................................................10Description .......................................................................................................................................10The Improvement Project ..................................................................................................................10Assessments......................................................................................................................................12Teeter Plan........................................................................................................................................12Estimated Direct and Overlapping Indebtedness ...................................................................................12Assessed Value-to-Lien Ratios ..........................................................................................................14Top Ten Property Owners .................................................................................................................16Historical Property Tax Collections and Delinquencies......................................................................17

BOND OWNERS’ RISKS.......................................................................................................................18General .............................................................................................................................................18Risks of Real Estate Secured Investments Generally..........................................................................18Foreclosure Shortfall............................................................................................................................18Property Tax Delinquencies ..............................................................................................................19Delinquency Resulting in Ultimate or Temporary Loss on Bonds ......................................................19Concentration of Ownership..............................................................................................................19Non-Cash Payments of Assessments .................................................................................................19Land Values......................................................................................................................................19Limited City Obligation Upon Delinquency ......................................................................................20Collection of the Assessments ...........................................................................................................20Availability of Funds to Pay Delinquent Assessment Installments .....................................................21Owner Not Obligated to Pay Assessments .........................................................................................21

TABLE OF CONTENTS

PAGE

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Parity Taxes and Special Assessments; Future Indebtedness ..............................................................21Bankruptcy and Foreclosure ..............................................................................................................22FDIC/Federal Government Interests in Parcels ..................................................................................22Natural Disasters...............................................................................................................................23Hazardous Substances .......................................................................................................................23No Acceleration ................................................................................................................................24Loss of Tax Exemption .....................................................................................................................24IRS Audit of Tax-Exempt Bond Issues ..............................................................................................24Limited Secondary Market ................................................................................................................24Ballot Initiatives and Legislative Measures........................................................................................25Constitutional Amendment – Articles XIIIC and XIIID .....................................................................25

CONCLUDING INFORMATION...........................................................................................................26Continuing Disclosure.......................................................................................................................26Legal Opinion ...................................................................................................................................26Tax Matters.......................................................................................................................................27No Litigation.....................................................................................................................................28Rating ...............................................................................................................................................29Financial Interests .............................................................................................................................29Underwriting.....................................................................................................................................29Financial Advisor..............................................................................................................................29Miscellaneous ...................................................................................................................................29

APPENDIX A – ASSESSMENT DIAGRAM................................................................................... A-1APPENDIX B – INFORMATION ABOUT THE NEWPORT BEACH AREA................................ B-1APPENDIX C – SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE ...................... C-1APPENDIX D – FORM OF LEGAL OPINION............................................................................... D-1APPENDIX E – INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY ....... E-1APPENDIX F – DISCLOSURE DISSEMINATION AGENT AGREEMENT................................. F-1APPENDIX G – FINAL ENGINEER’S REPORT ........................................................................... G-1APPENDIX H – LIST OF UNPAID ASSESSMENTS ..................................................................... H-1

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SUMMARY STATEMENT

Purpose Proceeds of the $3,295,700 principal amount of the City ofNewport Beach Assessment District No. 103 (G Street/East BalboaBoulevard/Channel Road/Ocean Boulevard) Limited Obligation ImprovementBonds (the “Bonds”), together with certain investment earnings and certainother moneys, will be used to finance the costs of relocation of certainoverhead electrical and communication facilities to underground locations,together with appurtenances and appurtenant work in connection therewith (the“Improvement Project”). See “THE DISTRICT – The Improvement Project”herein. Bond proceeds will also be used to establish a debt service reserve fundand to pay the costs of issuance of the Bonds.

The District The City of Newport Beach Assessment District No. 103 (“the District”)consists of approximately 26.5 acres located in Newport Beach, California (the“City”). The District is bordered by G Street, East Balboa Boulevard, ChannelRoad and Ocean Boulevard. The District was formed by the City on July 28,2009. The amount of assessments levied in the District was $5,863,059, andprepayments have been made with respect to $2,527,513.01 of assessments.There are currently 211 parcels in the District with unpaid assessments in theamount of $3,335,545.99.

Security for the Bonds The Bonds are issued upon and secured by a pledge of revenues received by theCity in each Fiscal Year from the collection of annual installments of unpaidassessments, including penalties and interest and proceeds from the sale ofproperty for delinquent assessments, on parcels within the District but excludingamounts collected by the City for the payment of administration costs(“Assessment Revenues”). See “SECURITY FOR THE BONDS – ReserveFund – No Additional Bonds Except for Refunding Bonds” herein. The unpaidassessments represent fixed liens on the assessed parcels. They do not, however,constitute a personal indebtedness of the owners of such parcels.

Pursuant to the Improvement Bond Act of 1915, installments of principal ofassessments and interest thereon sufficient to meet annual debt service on theBonds will be billed by the County of Orange (the “County”) to owners ofparcels within the District against which there are unpaid assessments (the“Assessment Installments”). Upon receipt by the Paying Agent from the City,these Assessment Installments are to be deposited into the Redemption Fund,which will be held by the Paying Agent and used to pay Bond principal andinterest as they become due. The Assessment Installments billed against eachparcel each fiscal year represent pro rata shares of the total principal andinterest coming due in the ensuing calendar year, based on the percentagewhich the unpaid assessment against that parcel bears to the total of unpaidassessments levied to repay the Bonds.

The City will deposit $197,742.00 from Bond proceeds into a Reserve Fund (the“Reserve Fund”). The Reserve Fund will be a source of available funds toadvance to the Redemption Fund in the event of delinquent installments. TheCity’s obligation to advance funds to the Redemption Fund in the event ofdelinquent installments is limited to the balance in the Reserve Fund.

Pursuant to the Indenture, the City has no obligation to replenish theReserve Fund except to the extent that delinquent assessments are paid orproceeds from foreclosure sales are realized. See “SECURITY FOR THEBONDS – Reserve Fund.”

The City covenants with and for the benefit of the owners of the Bonds that it willcommence judicial foreclosure proceedings against properties with delinquentAssessment Installments under certain circumstances. See “SECURITY FORTHE BONDS – Covenant for Superior Court Foreclosure.”

Redemption Any Bond or any portion of a Bond may be redeemed, in whole or inpart, in increments of $5,000, in advance of maturity on any Interest PaymentDate, commencing March 2, 2010, from any source of funds legally available,including, without limitation, the prepayment of assessments and surplus fundsfrom the Improvement Fund, if any, together with accrued interest to the dateof redemption at the redemption prices shown on the table under “THE BONDS –Redemption – Optional Redemption” herein.

Bond Owners’ Risks Unpaid assessments do not constitute a personal indebtedness of the owners ofthe parcels within the District. There is no assurance that such owners will beable to pay the Assessment Installments or that they will pay such installmentseven though financially able to do so.

Because the City has not obligated itself to advance funds to pay debt service onthe Bonds in the event of delinquent Assessment Installments, failure by ownersof the parcels to pay Assessment Installments when due, depletion of the ReserveFund or the inability of the City to sell parcels which have been subject toforeclosure proceedings for amounts sufficient to cover the delinquentAssessment Installments levied against such parcels may result in the inabilityof the City to make full or punctual payments of debt service on the Bonds; andowners of the Bonds would therefore be adversely affected. See “BONDOWNERS’ RISKS.”

1

$3,295,700CITY OF NEWPORT BEACH

ASSESSMENT DISTRICT NO. 103(G STREET/EAST BALBOA BOULEVARD/CHANNEL ROAD/OCEAN BOULEVARD)

LIMITED OBLIGATION IMPROVEMENT BONDS

INTRODUCTION

The purpose of this Official Statement, which includes the cover page and the appendices hereto, is toprovide certain information concerning the City of Newport Beach Assessment District No. 103(G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard) Limited Obligation ImprovementBonds (the “Bonds”). Assessment District No. 103 (the “District”) was formed by the City of NewportBeach (the “City”) on July 28, 2009, to underground power and communication facilities and associatedstreet rehabilitation in the District.

The Bonds are being issued pursuant to the Improvement Bond Act of 1915 (the “1915 Act”) and aBond Indenture, dated as of October 1, 2009 (the “Indenture”), by and between the City and U.S. BankNational Association, as paying agent (the “Paying Agent”).

Unpaid assessments represent liens on the parcels in the District on which they have beenconfirmed; they do not, however, constitute a personal indebtedness of the owners of the parcels.Installments of principal of assessments and interest thereon sufficient to meet annual debt service on theBonds will be billed by the County of Orange (the “County”) to owners of parcels within the District againstwhich there are unpaid assessments (the “Assessment Installments”). Unpaid assessments and all moneysand securities from time to time held by the City or by the Paying Agent in certain specified funds andaccounts under the Indenture are pledged to the payment of the principal of and interest on the Bonds.

The Bonds do not constitute a debt of the City, and the City will not be liable thereon except foramounts pledged under the Indenture. The full faith and credit of the City is not pledged to thepayment of the Bonds; and the payment of the Bonds is not secured by any encumbrance, mortgageor other pledge of property of the City except the pledge described under the heading “SECURITYFOR THE BONDS.”

Brief descriptions of the Bonds, the District, the Indenture, the Disclosure Dissemination AgentAgreement, dated as of October 1, 2009, by and between the City and Digital Assurance Certification,L.L.C. (“DAC”) (the “Disclosure Agreement”) and certain other matters are set forth below. Suchdescriptions do not purport to be comprehensive or definitive. All references herein to any of the aforesaiddocuments are qualified in their entirety by reference to the forms thereof, which are available for inspectionat the office of the Paying Agent in Los Angeles, California, and at the office of the City Clerk in NewportBeach, California. Capitalized terms not defined herein have the respective meanings ascribed to them inthe Indenture.

THE FINANCING PLAN

Purpose of the Bonds

Proceeds from the sale of the Bonds will be used to finance the cost of undergrounding power andcommunication facilities and associated street rehabilitation (the “Improvement Project”) that serve theproperty within the District, as further described in the section herein entitled “THE DISTRICT – TheImprovement Project.” The estimated costs of the Improvement Project are $5,065,143 (excludingfinancing and incidental costs). The total amount of assessments levied in the District was $5,863,059, and

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prepayments have been made with respect to $2,527,513.01 of assessments. There are currently 211 parcelsin the District with unpaid assessments in the amount of $3,335,545.99. See Table 2 under the caption“THE DISTRICT – The Improvement Project” for a more detailed statement of all costs and expensesrelating to the Improvement Project.

Sources and Uses of Funds

The Paying Agent will receive the proceeds from the sale of the Bonds upon delivery of such Bondsto the purchasers thereof. The proceeds of the Bonds will be applied as set forth in the following table:

SOURCES AND USES OF FUNDS

SOURCES:Par Amount of Bonds $3,295,700.00Premium/Net Original Issue Discount (12,099.60)Less Underwriter’s Discount (22,872.16)

Total Sources $3,260,728.24

USES:Improvement Fund $2,731,934.00Reserve Fund 197,742.00Costs of Issuance(1) 331,052.24

Total Uses $3,260,728.24(1) Costs of issuance include expenses incidental to forming the District and issuing the Bonds, legal fees,

printing costs, Paying Agent Fees and other miscellaneous issuance costs.

See Table 2 under the caption “THE DISTRICT – The Improvement Project” for more detailedinformation regarding costs and expenses relating to the Improvement Project.

THE BONDS

Authority for Issuance

The proceedings for the District were conducted pursuant to the Municipal Improvement Act of 1913(Division 12 of the California Streets and Highways Code) (the “1913 Act”). The Bonds, which represent theunpaid assessments levied against the property in the District, are issued pursuant to the provisions of the 1915Act and the Indenture. Pursuant to the 1913 Act and Proposition 218, which added Article XIIID to theCalifornia Constitution, the City held a public hearing on July 28, 2009, in the proposed District. The Cityreceived a favorable response from the landowners casting assessment ballots prior to the conclusion of thepublic hearing.

Description of the Bonds

The $3,295,700 principal amount of Bonds are dated as of the date of delivery and will mature in theamounts and on the dates set forth on the inside cover hereof. Interest will be paid at the rates set forth on theinside cover, commencing on March 2, 2010, and semiannually thereafter on March 2 and September 2 ofeach year (each an “Interest Payment Date”) until maturity. The Bonds are issued only as fully-registeredbonds without coupons in the denomination of $5,000 or any integral multiple thereof, except for oneBond (which shall be the Bond maturing in the first year of maturity) which shall include the amount bywhich the total aggregate principal amount of the Bonds exceeds the maximum integral multiple of $5,000.The Bonds will be executed and delivered as fully-registered Bonds in the name of Cede & Co., nominee

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of The Depository Trust Company, New York, New York (“DTC”), as registered owner of all Bonds. Theprincipal of and interest with respect to the Bonds will be paid directly to Cede & Co. by the Paying Agent,as long as DTC or its nominee, Cede & Co., is the registered owner of the Bonds. For information relating toDTC and the DTC book-entry system as it relates to the Bonds, see APPENDIX E – “INFORMATIONCONCERNING THE DEPOSITORY TRUST COMPANY.” The information presented therein is basedsolely on information provided by DTC and no representation is made by the City concerning theaccuracy thereof.

Principal and redemption premium, if any, will be payable at the Principal Office of the Paying Agenton presentation of the Bonds. Interest will be calculated on the basis of a 360-day year composed oftwelve 30-day months. Each Bond will bear interest from the Interest Payment Date next preceding thedate of authentication thereof unless otherwise specified in the Indenture.

Redemption

Optional Redemption. Any Bond or any portion of a Bond may be redeemed, in whole or in part, inincrements of $5,000, in advance of maturity on any Interest Payment Date, commencing March 2, 2010,from any source of funds legally available including, without limitation, the prepayment of assessments andsurplus funds from the Improvement Fund, if any, at the redemption prices (expressed as a percentage of theprincipal amount to be redeemed) set forth below, together with accrued interest to the date of redemption:

Redemption Date Redemption PriceMarch 2, 2010 through September 2, 2014 103%March 2, 2015 and September 2, 2015 102%March 2, 2016 and September 2, 2016 101%March 2, 2017 and thereafter 100%

Purchase of Bonds. In lieu of payment at maturity or redemption, moneys in the Redemption Fund(other than moneys representing prepaid assessments) may be used and withdrawn by the Paying Agent forpurchase of Outstanding Bonds which mature on the next principal payment date, upon the filing with thePaying Agent, prior to the selection of Bonds for redemption, of a written request from the City requestingsuch purchase, at public or private sale as and when, and at such prices (including brokerage and othercharges) as such request may provide, but in no event may Bonds be purchased at a price in excess of theprincipal amount thereof, the premium, if any, plus interest accrued to the date of maturity or redemptionthat would otherwise be payable.

Selection of Bonds for Redemption. If less than all of the outstanding Bonds or portions thereofare to be redeemed, the Paying Agent shall select the Bonds to be redeemed in authorized denominations insuch a way that the ratio of outstanding Bonds to issued Bonds shall be approximately the same for eachannual maturity insofar as possible.

Notice of Redemption. When the Paying Agent receives notice from the City of its election toredeem Bonds at least sixty (60) days prior to the applicable redemption date, or when Bonds areotherwise to be redeemed pursuant to the Indenture, the Paying Agent shall give notice, in the name and atthe expense of the City, of the redemption of such Bonds. Such notice of redemption shall (a) specify thenumbers of the Bonds selected for redemption, except that where all the Bonds are subject to redemptionor all the Bonds of a maturity date are subject to redemption, the numbers thereof need not be specified;(b) state the date fixed for redemption; (c) state the redemption price; (d) state the place or places where theBonds are to be redeemed; (e) in the case of Bonds to be redeemed only in part, state the portion of the Bondwhich is to be redeemed; and (f) state the CUSIP® numbers of the Bonds to be redeemed. Such notice shallfurther state that on the date fixed for redemption there shall become due and payable on each Bond, or portionthereof called for redemption, the principal thereof, together with any premium and interest accrued to the

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redemption date, and that from and after such date, interest thereon shall cease to accrue and be payable.At least 30 days but no more than 45 days prior to the redemption date, the Paying Agent shall mail byregistered or certified mail, postage prepaid, or deliver by personal service, a copy of such notice, to therespective owners of the Bonds to be redeemed at their addresses appearing on the bond register. Theactual receipt by the owner of any Bond of notice of such redemption shall not be a condition precedentthereto, and failure to receive such notice shall not affect the validity of the proceedings for the redemption ofsuch Bonds or the cessation of interest on the redemption date. A certificate by the Paying Agent that noticeof such redemption has been given as provided in the Indenture shall be conclusive as against all parties,and it shall not be open to any Bond Owner to show that he or she failed to receive notice of suchredemption.

Partial Redemption of Bonds. Upon surrender of any Bond to be redeemed in part only, the Cityshall execute and the Paying Agent shall authenticate and deliver to the Bond Owner, at the expense of theCity, a new Bond or Bonds of authorized denominations equal in aggregate amount to the unredeemed portionof the Bond surrendered, with the same interest rate and the same maturity.

Effect of Notice and Availability of Redemption Money. Notice of redemption having been dulygiven, as provided in the Indenture, and the amount necessary for the redemption having been made availablefor that purpose and being available therefor on the date fixed for such redemption:

(1) The Bonds, or portions thereof, designated for redemption shall, on the date fixed forredemption, become due and payable at the redemption price thereof as provided in the Indenture, anything inthe Indenture or in the Bonds to the contrary notwithstanding;

(2) Upon presentation and surrender thereof at the Principal Office of the Paying Agent, suchBonds shall be redeemed at the specified redemption price;

(3) From and after the redemption date, the Bonds or portions thereof so designated forredemption shall be deemed to be no longer outstanding and such Bonds or portions thereof shall cease to bearfurther interest; and

(4) From and after the date fixed for redemption, no owner of any of the Bonds or portionthereof so designated for redemption shall be entitled to any of the benefits of the Indenture, or to anyother rights, except with respect to payment of the redemption price and interest accrued to the redemptiondate from the amounts so made available.

Improvement Fund

Moneys in the Improvement Fund (as defined in the Indenture), will be used only for theImprovement Project as authorized in the assessment proceedings and all incidental costs related thereto,including the costs of issuing the Bonds, all as more particularly described in the Assessment Engineer’sReport for the District on file in the Office of the City Clerk of the City, as the report may be amended fromtime to time pursuant to the Municipal Improvement Act of 1913. Upon completion of the acquisition andconstruction of the Improvements, the Superintendent of Streets of the City will file a certificate ofcompletion (the “Certificate of Completion”) with the Treasurer. Any funds remaining in the ImprovementFund following receipt by the Treasurer of the Certificate of Completion shall constitute surplus (“Surplus”),and in accordance with the provisions of the Resolution of Intention (as defined in the Indenture), the Surplusshall be utilized or distributed in such manner as shall be determined by the City Council for any one or morepurposes set forth in said Resolution of Intention.

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Redemption Fund

The Paying Agent will establish and maintain a Redemption Fund (as defined in the Indenture)designated by the name of the District and deposit therein from time to time (i) the amount of the proceeds ofthe Bonds which represents accrued and capitalized interest, if any, on the Bonds, (ii) all sums receivedfrom the City representing the collection of the assessments (other than assessments for administrative costs)and the interest thereon and (iii) any surplus in the Improvement Fund to the extent provided in theIndenture.

Prepayment Account. There will be established by the Paying Agent a prepayment subaccountwithin the Redemption Fund (the “Prepayment Account”). The Paying Agent will not be required toestablish the Prepayment Account until the time when deposits are required to be made therein. The City willtransfer to the Paying Agent for deposit in the Prepayment Account all moneys received by the Cityrepresenting the prepayment of the principal of, and interest and redemption premium on, any Bonds. Suchmoneys will be applied solely to the payment of the principal of, and interest and premium on, Bonds to beredeemed prior to maturity pursuant to the optional redemption provisions of the Indenture.

Except for money received with respect to assessment surcharges for administrative costs, the Citywill transfer or cause to be transferred to the Paying Agent at least five days prior to each InterestPayment Date all sums received and not previously transferred from the collection of the assessments and anyinterest thereon and all sums received for the partial or full prepayment of assessments as required by Streetsand Highways Code Section 8767. Any transfer representing the prepayment of assessments will beaccompanied by written instructions as to the disposition of such sums to redeem Bonds prior to maturityor to pay accrued interest on any Bonds to be redeemed.

Principal of and interest on the Bonds will be paid by the Paying Agent to the registered ownersout of the Redemption Fund to the extent funds on deposit in the Redemption Fund are available therefor.

Reserve Fund

The City will create and maintain the Reserve Fund to be designated by the name of the District. TheReserve Fund will be initially funded from a portion of the Bond proceeds in an amount equal to 6% of theoriginal principal amount of the Bonds. The City will also deposit in the Reserve Fund funds which representthe proceeds of (i) payments made to redeem delinquent Assessment Installments or (ii) the judicialforeclosure sale of parcels pursuant the Indenture, in each case if and to the extent that any advance wasmade from the Reserve Fund to the Redemption Fund as a result of such delinquencies.

Moneys in the Reserve Fund will be applied as follows:

(1) Amounts in the Reserve Fund will be transferred to the Paying Agent for deposit in theRedemption Fund if there are insufficient moneys in said Redemption Fund to pay principal of and intereston the Bonds when due. Amounts so transferred will be repaid to the Reserve Fund from proceeds fromthe redemption or foreclosure of property with respect to which an assessment is unpaid and from payments ofdelinquent assessments.

(2) Interest earned on the permitted investment of moneys on deposit in the Reserve Fund willremain in the Reserve Fund to the extent required to maintain the Reserve Fund at the Reserve Requirement(as defined herein). Not later than July 15 of each fiscal year, the amount on deposit in the Reserve Fund inexcess of the Reserve Requirement will be transferred from the Reserve Fund to the Redemption Fund andcredited to the unpaid Assessment Installments payable during such fiscal year. “Reserve Requirement” shallmean the least of (i) the maximum annual debt service on the outstanding Bonds, (ii) 125% of the averageannual debt service on the outstanding Bonds or (iii) 6% of the original principal amount of Bonds (the

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“Reserve Requirement”). The City Auditor’s records will reflect the credits against each of the unpaidassessments in amounts equal to each parcel’s proportionate share of such transfer.

Notwithstanding the above, interest earnings on moneys on deposit in the Reserve Fund in excess ofthe “yield” on the Bonds, as that term is defined in the Internal Revenue Code of 1986 (the “Code”), will besubject to transfer and rebate to the United States Treasury.

(3) Whenever moneys in the Reserve Fund, together with available funds in the RedemptionFund, are sufficient to fully and timely pay and redeem all outstanding Bonds, plus accrued interest thereon,the money will be transferred to the Redemption Fund and collection of a corresponding amount of theremaining unpaid assessments will cease.

(4) In the event an assessment is to be prepaid in cash, the City will credit the prepaid assessmentwith a proportionate share of the Reserve Fund and transfer an amount equal to such credit to the RedemptionFund to be utilized for the advance retirement of Bonds.

Rebate Fund

The City will establish and maintain a Rebate Fund (as defined in the Indenture). Deposits shallbe made to the Rebate Fund only as may be required by and in accordance with the provisions of the TaxCertificate (as defined in the Indenture) pertaining to the Bonds. Amounts, if any, on deposit in the RebateFund will be paid to the United States of America. All earnings on amounts on deposit in the Rebate Fundwill remain therein until all amounts payable to the United States of America have been paid.

Investments

Obligations purchased as investments of moneys in any of the funds in which investments areauthorized will be deemed at all times to be part of such funds. Subject to the restrictions set forth in theIndenture, moneys in the Redemption Fund may from time to time be invested by the Paying Agent at thewritten direction of the Treasurer of the City, which written direction will contain a certification to the PayingAgent that such investments are Authorized Investments as defined in the Indenture. In the absence ofwritten direction from the City, the Paying Agent will invest the moneys deposited in the RedemptionFund and any account of such funds in money market funds as described in the Indenture. Such moneys willbe invested only in obligations which will by their terms mature on such dates so as to ensure the paymentof principal of and interest on the Bonds as the same become due; provided, investments of money in theReserve Fund will mature not later than five years from the date of purchase except such money may beinvested in a repurchase agreement or an investment agreement without such five-year limitation so longas the repurchase agreement or investment agreement provides for withdrawals at par on or before anyInterest Payment Date.

The City, and if applicable, the Paying Agent, will sell at the best price reasonably obtainable orpresent for redemption any obligations so purchased whenever it may be necessary to do so in order to providemoneys to meet any payment or transfer for such funds or from such funds. For the purpose of determining atany given time the balance in any such funds, any such investments constituting a part of such funds will bevalued at their market value. Notwithstanding anything to the contrary, the Paying Agent will not beresponsible for any loss from any investments pursuant to the Indenture, except for its own negligence orwillful misconduct. The Paying Agent may act as principal or agent in the acquisition or disposition ofinvestments. The Paying Agent and the City may commingle the funds established under the Indenture forinvestment purposes but will nonetheless account for each fund separately.

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Annual Debt Service

Table 1 below sets forth the annual debt service on the Bonds based on the maturity schedule andinterest rates set forth on the inside cover page of this Official Statement.

TABLE 1

CITY OF NEWPORT BEACHASSESSMENT DISTRICT NO. 103

(G STREET/EAST BALBOA BOULEVARD/CHANNEL ROAD/OCEAN BOULEVARD)LIMITED OBLIGATION IMPROVEMENT BONDS

ANNUAL DEBT SERVICEYear EndingSeptember 2 Principal Interest Total

2010 $190,700.00 $93,375.40 $284,075.402011 185,000.00 102,847.50 287,847.502012 190,000.00 100,257.50 290,257.502013 190,000.00 96,647.50 286,647.502014 195,000.00 92,467.50 287,467.502015 200,000.00 87,397.50 287,397.502016 205,000.00 81,397.50 286,397.502017 215,000.00 74,837.50 289,837.502018 220,000.00 67,581.26 287,581.262019 230,000.00 59,606.26 289,606.262020 235,000.00 50,981.26 285,981.262021 245,000.00 41,875.00 286,875.002022 255,000.00 32,075.00 287,075.002023 265,000.00 21,875.00 286,875.002024 275,000.00 11,275.00 286,275.00Totals $3,295,700.00 $1,014,496.68 $4,310,196.68

SECURITY FOR THE BONDS

General

The Bonds are issued upon and secured by a pledge of Assessment Revenues. The Bonds aresecured by the moneys in the Redemption Fund and the Reserve Fund and any earnings thereon (except to theextent earnings must be transferred to the Rebate Fund under the Indenture) and by the unpaid assessments.Principal of and interest on the Bonds are payable exclusively out of the Redemption Fund.

The payment of the amount of each Assessment Installment, interest and any penalties and collectioncosts is secured by an assessment lien upon the applicable property in the District. Such lien is co-equalwith the latest lien thereon to secure the payment of general ad valorem property taxes, is not subject toextinguishment by the sale of any property on account of the non-payment of general property taxes, andis prior and superior to all liens, claims, encumbrances and titles other than the liens of assessments, specialtaxes and general property taxes. Such lien is subordinate to all fixed special assessment liens previouslyimposed upon the same property but has priority over all private liens and over all fixed special assessmentliens which may thereafter be created against the property. The Assessment Installments are pledged tosecure the payment of the principal of, premium, if any, and interest on the Bonds, and, as received by or

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otherwise credited to the City, will immediately be subject to the lien of such pledge. Although the unpaidassessments constitute liens upon the parcels assessed, they do not constitute a personal indebtedness of theowners of said parcels. There can be no assurance as to the financial or legal ability, or the willingness, of suchproperty owners to pay the unpaid assessments.

The failure of a property owner to pay an Assessment Installment will not result in anincrease in Assessment Installments applicable to other parcels within the District.

The unpaid assessments will be collected in semi-annual installments, together with interest on thedeclining balances, on the County tax roll on which general taxes on real property are collected, and the unpaidassessments are payable and become delinquent at the same time and in the same proportionate amountsand bear the same proportionate penalties and interest after delinquency as do general taxes, and theassessment parcels are subject to the same provisions for sale and redemption as are properties for nonpaymentof general taxes. See also the section herein below entitled “Covenant for Superior Court Foreclosure.”

Reserve Fund

The Reserve Fund will be a source of available funds to advance to the Redemption Fund in theevent of delinquent Assessment Installments. See “THE BONDS – Reserve Fund” herein. The City’sobligation to advance funds to the Redemption Fund in the event of delinquent AssessmentInstallments is limited to the balance in the Reserve Fund. Pursuant to the Indenture, the City has noobligation to replenish the Reserve Fund except to the extent that delinquent Assessment Installmentsare paid or proceeds from foreclosure sales are realized. However, the determination by the City not toobligate itself to advance available funds to cure delinquencies will not prevent the City from, in its solediscretion, advancing such funds.

No Additional Bonds Except for Refunding Bonds. Except for refunding bonds, no additional bondsor other obligations will be issued or incurred that will be secured by or payable from the assessments of theDistrict.

Covenant for Superior Court Foreclosure

The City has covenanted in certain circumstances to institute judicial foreclosure in the event of adelinquency and thereafter to prosecute diligently to completion court foreclosure proceedings upon thelien of any and all delinquent assessments and interest.

Pursuant to Part 14 of Division 10 of the California Streets and Highways Code, as amended, inthe event any Assessment Installment is not paid when due, the City may order the institution of a court actionto foreclose the lien of the delinquent unpaid Assessment Installments. In such an action, the propertysubject to the unpaid Assessment Installments may be sold at judicial foreclosure sale. This foreclosure saleprocedure is not mandatory. The City will review the public records of the County of Orange, California,in connection with the collection of the Assessment Installments not later than August 1 of each year todetermine the amount of Assessment Installments collected in the prior Fiscal Year. If the Citydetermines that any parcel or parcels are delinquent in the payment of Assessment Installments, then the Citywill cause judicial foreclosure proceedings to be filed in the superior court not later than December 1 ofeach year and will prosecute diligently such foreclosure proceedings to judgment and judicial foreclosuresale; provided, however, the commencement of any foreclosure action may be deferred in the sole discretionof the City if, and only so long as, the amount in the Reserve Fund is not less than seventy percent (70%) ofthe Reserve Requirement.

Judicial Foreclosure Proceedings. The 1915 Act provides that the court in a foreclosureproceeding has the power to order property securing delinquent Assessment Installments to be sold for an

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amount not less than all Assessment Installments, interest, penalties, costs, fees and other charges that aredelinquent at the time the foreclosure action is ordered and certain other fees and amounts as providedtherein (the “Minimum Price”). The court may also include subsequent delinquent Assessment Installmentsand all other delinquent amounts.

The City may, at its discretion but is not required to, become the purchaser of any property sold in aforeclosure proceeding. If the City becomes the purchaser, it shall pay into the Redemption Fund an amountnecessary to satisfy the judgment, less any advances by the City to cover delinquent Assessment Installments,plus simple interest on such net amount at the interest rates borne by the Bonds, from the dates ofdelinquency. Unless such property is subsequently resold, the City must transfer to the Redemption Fundany future Assessment Installments pending redemption. The City may thereupon be reimbursed for anyamount advanced from the City to the Redemption Fund to cover such future Assessment Installments withrespect to the property so sold from the proceeds of such sale.

If the property is sold to a purchaser other than the City, the City shall deposit the proceeds from thesale of the property into the Redemption Fund. From such amount, the City shall reimburse the ReserveFund the amount, if any, of funds advanced from the Reserve Fund to the Redemption Fund to cover thedelinquent Assessment Installments with respect to the property which is sold. After reimbursement of theReserve Fund, the City may be reimbursed for any other amounts advanced from it to the RedemptionFund to cover delinquent Assessment Installments and interest with respect to the property sold in suchproceedings. Any funds in excess of the amount necessary to reimburse the City may be applied by the Cityto pay interest and penalties, costs, fees and other charges, to the extent they were included in the salesproceeds.

If the property to be sold fails to sell for the Minimum Price, the City may petition the court tomodify the judgment so that the property may be sold at a lesser price or without a Minimum Price. Noticeof the hearing on such petition must be given to all Bond Owners. In certain circumstances, the court maymodify the judgment after the hearing to permit the sale of the property at a price lower than the MinimumPrice if the court makes certain determinations, including determinations that the sale at less than theMinimum Price will not result in an ultimate loss to Bond Owners or that Bond Owners of at least 75% ofthe principal amount of Bonds outstanding have consented to the petition and certain other circumstancesdescribed in the statute exist. Neither the property owner nor any holder of a security interest in theproperty nor any defendant in the foreclosure action may purchase the property at the foreclosure sale forless than the Minimum Price.

A period of 140 days must elapse after the date notice of levy of the interest in real property is servedon the judgment debtor before the sale of such lot or parcel, with not more than 4 dwelling units, can be made.However, pursuant to Streets and Highways Code Section 8832, the 140-day period may be shortened to20 days for undeveloped property. If the judgment debtor fails to redeem, and if the purchaser at the sale is thejudgment creditor (e.g., the City), an action may be commenced by the delinquent property owner within90 days after the date of sale to set aside such sale. The constitutionality of the repeal of the one yearredemption period has not been tested; and there can be no assurance that, if tested, such legislation will beupheld.

In the event such superior court foreclosure or foreclosures are necessary, there may be a delayin payments to Bond Owners pending prosecution of the foreclosure proceedings and receipt by theCity of the proceeds of the foreclosure sale; it is also possible that no bid for the purchase of theapplicable property would be received at the foreclosure sale. See the section herein entitled “BONDOWNERS’ RISKS.”

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Covenant to Maintain Tax-Exempt Status

The City covenants that it will not make any use of the proceeds of the Bonds issued under theIndenture which would cause the Bonds to become “arbitrage bonds” subject to federal income taxationpursuant to the provisions of Section 148(k) of the Code, or to become “federally-guaranteed obligations”pursuant to the provisions of Section 149(b) of the Code, or to become “private activity bonds” pursuant tothe provisions of Section 14 1(a) of the Code. To that end, the City will comply with all applicablerequirements of the Code and all regulations of the United States Department of Treasury issued thereunderto the extent such requirements are, at the time, applicable and in effect. Additionally, the City agrees toimplement and follow each and every recommendation provided by bond counsel and deemed to be necessaryto be undertaken by the City to ensure compliance with all applicable provisions of the Code in order topreserve the exclusion of interest on the Bonds from gross income for federal income tax purposes.

Assessments Create a Lien

The Assessment Installments and any interest and penalties thereon constitute a lien against theparcels on which they were imposed until the same is paid. Each lien is subordinate to all fixed specialassessment liens previously imposed upon the same property but has priority over all private liens and overall fixed special assessment liens which may thereafter be created against the property. Each lien is also co-equal to and independent of the lien for general and special taxes.

Limited City Obligation Upon Delinquency

The City’s obligation to advance moneys to pay debt service on the Bonds in the event of delinquentAssessment Installments is limited to the balance in the Reserve Fund.

Neither the faith and credit nor the taxing power of the City, the State of California or anypolitical subdivision thereof is pledged to the payment of the Bonds.

THE DISTRICT

Description

The District consists of approximately 26.5 acres located in the City. The District is bordered byG Street, East Balboa Boulevard, Channel Road and Ocean Boulevard. The District was formed by theCity on July 28, 2009. The amount of assessments levied in the District was $5,863,059, and prepaymentshave been made with respect to $2,527,513.01 of assessments. There are currently 211 parcels in theDistrict with unpaid assessments in the amount of $3,335,545.99.

The Improvement Project

The following is a summary of the District Improvement Project Cost Estimate as contained in theFinal Engineer’s Report prepared by Harris & Associates, Irvine, California, Assessment Engineers, attachedhereto as Appendix G.

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TABLE 2



ENGINEER’S ESTIMATE OF COSTS AND EXPENSES

DESIGN & CONSTRUCTION COSTS*Electrical Costs (Southern California Edison)

Electrical Construction Costs $3,053,100Construction Contingency (~10%) 305,310Edison Design Engineering 135,800

$3,494,210Telephone Costs (AT&T)

Telephone Construction Costs $992,998Construction Contingency (~10%) 99,300AT&T Design Engineering 102,000

$1,194,298

Street / Alley Rehabilitation $1,000,000Construction Contingency (~7.5%) 75,000

$1,075,000

Estimated Utility Contribution for Equivalent Overhead System -678,621

Total Design & Construction Costs: $5,084,887

Less deduct from contingency: -19,744

Modified Total Design & Construction Costs: $5,065,143

INCIDENTAL EXPENSES(1)

Total Incidental Expenses: $348,113

Less deduct from contingency: -1,352

Modified Total Incidental Expenses: $346,761

Total Construction and Incidental Expenses: $5,411,904

FINANCING COSTS(2)

Total Financing Costs(3): $451,155

TOTAL AMOUNT TO ASSESSMENT: $5,863,059* Time Warner Cable is required to pay for undergrounding through the Franchise Agreement with the City.(1) Includes costs for inspection, engineering, administration, printing, consultants and legal fees.(2) Includes Reserve Requirement and Underwriter’s discount. The actual Reserve Requirement represents 6% of the principal amount of the

Bonds.(3) Amount shown does not include savings due to payments received during the cash collection period. Total Financing Costs amounted to

approximately $257,000 due to these savings.______________________Source: Harris & Associates.

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Assessments

The City Council has taken proceedings under the 1913 Act for the formation of the District and hasconfirmed an assessment, which assessment and a related diagram were recorded in the office of the CityEngineer, acting as the Superintendent of Streets, and with the County Recorder of the County of Orange.A notice of assessment, as prescribed in Section 3114 of the Streets and Highways Code, has been recordedwith the County Recorder of the County of Orange, whereupon the assessment attached as a lien upon theproperty assessed within the District as provided in Section 3115 of the Streets and Highways Code. OnJuly 28, 2009, the City Council conducted a duly noticed public hearing and ballot procedure regarding theformation of the District and the issuance of the Bonds. At the ballot procedure, the property ownersapproved the levy of the assessments. At the end of the 30-day cash collection period, a list of unpaidassessments was filed with the City Treasurer pursuant to Section 8620 of the 1915 Act. During the 30-daycash collection period, prepayments have been made with respect to $2,527,513.01 of assessments, and theAdministrative Services Director has listed all unpaid assessments in the aggregate amount of $3,335,545.99.

The amounts to be assessed against the parcels of property to pay the costs and expenses of theacquisition and construction of the improvements have been based on the estimated benefits to be derived bythe various properties within the District.

Teeter Plan

A Teeter Plan is an alternative method for the distribution of secured property taxes to localagencies. Teeter Plan provisions are set forth in Sections 4701 to 4717 of the California Revenue andTaxation Code. If a Teeter Plan is adopted and implemented by a County Board of Supervisors, local agenciesfor which a county acts as “bank” and certain other public agencies and taxing areas located in that countyreceive annually the full amount of their share of property taxes on the secured rolls, including delinquentproperty taxes which have yet to be collected.

No Teeter Plan applies to the District.

Estimated Direct and Overlapping Indebtedness

Within the District’s boundaries are numerous overlapping local agencies providing publicservices. Some of these local agencies have outstanding bonds which are secured by taxes and assessmentson the parcels within the District and others have authorized but unissued bonds which, if issued, will besecured by taxes and assessments levied on parcels within the District. The approximate amount of thedirect and overlapping debt secured by such taxes and assessment on the parcels within the District forFiscal Year 2009-10 is shown in Table 3 below (the “Debt Report”).

The Debt Report has been derived from data assembled and reported to the District by CaliforniaMunicipal Statistics, Inc. Neither the District nor the City have independently verified the information in theDebt Report and do not guarantee its completeness or accuracy.

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TABLE 3



DIRECT AND OVERLAPPING DEBT

(Excludes Parcels with Prepaid Assessments)

2009-10 Local Secured Assessed Valuation: $168,587,304

DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT: % Applicable(1) Debt 9/1/09Metropolitan Water District 0.009% $ 26,408Coast Community College District 0.168 562,328Newport Mesa Unified School District 0.343 561,040City of Newport Beach Assessment District No. 103 100. 3,335,500 (2)

TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT $4,485,276

OVERLAPPING GENERAL FUND DEBT:Orange County General Fund Obligations 0.043% $177,449Orange County Pension Obligations 0.043 25,513Orange County Board of Education Certificates of Participation 0.043 8,355Municipal Water District of Orange County Water Facilities Corporation 0.051 8,142Newport Mesa Unified School District Certificates of Participation 0.353 1,853City of Newport Beach Certificates of Participation 0.441 19,117

TOTAL GROSS OVERLAPPING GENERAL FUND DEBT $240,429Less: MWDOC Water Facilities Corporation (100% self-supporting) 8,142

TOTAL NET OVERLAPPING GENERAL FUND DEBT $232,287

GROSS COMBINED TOTAL DEBT $4,725,705 (3)

NET COMBINED TOTAL DEBT $4,717,563

(1) Based on 2008-09 ratios.(2) 1915 Act bonds to be sold (estimate).(3) Excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and

non-bonded capital lease obligations.

Ratios to 2009-10 Assessed Valuation:Direct Debt ($3,335,500)............................................................. 1.98% (2)

Total Direct and Overlapping Tax and Assessment Debt............ 2.66%Gross Combined Total Debt ........................................................ 2.80%Net Combined Total Debt............................................................ 2.80%

STATE SCHOOL BUILDING AID REPAYABLE AS OF 6/30/09: $0

Source: California Municipal Statistics, Inc.

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Assessed Value-to-Lien Ratios

As of July, 2009, the assessed value of the parcels with unpaid assessments, is $168,587,304. Thetotal amount of unpaid assessments is $3,335,545.99. The total overall value-to-lien ratio for parcelswith unpaid assessments is 50.54-to-1.

The numbers provided in the following Tables 4, 5 and 6 exclude parcels that paid all of theassessment assigned to such parcels prior to issuance of the Bonds.

Table 4 provides information breaking down the overall value-to-lien ratio of parcels into groups ofparcels having a value-to-lien ratio within the specified range.

TABLE 4



ASSESSED VALUE-TO-LIEN RATIOS

Fiscal Year 2009-10 Assessed ValueValue-to-Lien

RatioNumber

of Parcels Land Structure TotalAssessment

Lien% ofLien

Greater than 100:1 36 $60,681,892 $10,033,262 $70,715,154 $514,836.44 15.43%50:1 to 99.99:1 51 42,603,668 11,280,596 53,884,264 775,168.61 23.24%25:1 to 49.99:1 52 24,870,313 6,581,889 31,452,202 846,663.56 25.38%10:1 to 24.99:1 28 4,470,306 3,459,426 7,929,732 496,230.27 14.88%Less than 9.99:1 44 2,801,040 1,804,912 4,605,952 702,647.12 21.07%

Totals 211 $135,427,219 $33,160,085 $168,587,304 $3,335,545.99 100.00%

Source: Harris & Associates.

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Table 5 provides information breaking down the overall value-to-lien ratio of parcels by land usewithin the District.

TABLE 5



ASSESSED VALUE-TO-LIEN RATIOS BY ACTUAL LAND USE

Fiscal Year 2009-10 Assessed Value

Land Use

Numberof

Parcels Land Structure TotalAssessment

Lien % of LienSingle Family Res. 189 $120,391,880 $31,148,935 $151,540,815 $2,937,924.87 88.08%Multi-Family Res. 17 9,950,512 1,650,071 11,600,583 337,235.87 10.11%Condominium 3 2,153,835 361,079 2,514,914 26,548.68 0.80%Vacant 2 2,930,992 0 2,930,992 33,836.57 1.01%

Totals 211 $135,427,219 $33,160,085 $168,587,304 $3,335,545.99 100.00%

Source: Harris & Associates.

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Top Ten Property Owners

Table 6 shows the ten property owners (as reflected in County records available as of July 2009)within the District with the largest unpaid assessments and the percentage of the assessments attributable toeach of these owner’s property. The table also shows the same information for all remaining landownersas a group.

TABLE 6



TOP TEN PROPERTY OWNERS

Fiscal Year 2009-10 Assessed Value

Owner Name(1)

Numberof

Parcels Land Structure TotalAssessment

Lien% ofLien

Collins, James B & Lorie R 1 $1,616,511 $236,195 $1,852,706 $52,576.64 1.50%Anderson, Nils & Nancy 1 546,555 581,158 1,127,713 48,932.89 1.40%Bibb, John M 2 1,937,710 203,254 2,140,964 46,330.07 1.32%Toohey, Thomas D 2 3,030,891 350,476 3,381,367 43,727.26 1.25%Wadsworth, John S III 2 3,753,928 388,836 4,142,764 41,645.00 1.19%Jones, Graham M 2 171,381 57,083 228,464 38,521.64 1.10%Mortenson, Kay H 1 251,183 172,071 423,254 37,480.51 1.07%Gates, Charles Edward 2 4,263,948 972,052 5,236,000 35,398.25 1.01%Blaha, John Joseph 2 380,557 246,275 626,832 30,713.21 0.88%Sims, Wayne R 1 1,183,881 134,116 1,317,997 31,233.76 0.89%

Subtotal Top 10 Owners: 16 17,136,545 3,341,516 20,478,061 406,559.23 12.19%

All other properties: 195 $118,290,674 $29,818,569 $148,109,243 $2,928,986.76 87.81%

Total: 211 $135,427,219 $33,160,085 $168,587,304 $3,335,545.99 100.00%

(1)County records may not reflect recent ownership changes, if any.____________________Source: Harris & Associates.

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Historical Property Tax Collections and Delinquencies

As of September 15, 2009, $15,688.27 of the property taxes levied in Fiscal Year 2008-09 on theparcels with unpaid assessments was delinquent. Property Taxes for Fiscal Year 2009-10 are not yet due.The level of delinquencies relating to property taxes in Fiscal Year 2008-09 and prior fiscal years reflectspayment on or before September 15, 2009, of delinquent property taxes and may not be indicative of futuredelinquencies for the Assessment Installments.

Table 7 sets forth ad valorem property tax collections and delinquencies for properties in theDistrict for Fiscal Years 2005-06 through 2008-09.

TABLE 7



PROPERTY TAX DELINQUENCIESFISCAL YEARS 2005-06 THROUGH 2008-09

Delinquencies - as of September 15, 2009(1)

AsmtNo. APN

FiscalYear

2005-06

FiscalYear

2006-07

FiscalYear

2007-08

FiscalYear

2008-09(2)

AggregateDelinquency

Amt(3)

Tax Roll asof Jul-09

Land Value


Imp Value


Total Value

59 048-191-06 – – – $8,056.07 $8,056.07 $1,452,382 $77,006 $1,529,388

262 048-272-14 – – 1,031.95 – 1,031.95 1,104,188 494,190 1,598,378

330 048-292-04 $7,184.64 – 7,474.30 7,632.20 22,291.14 664,856 156,626 821,482

$7,184.64 – $8,506.25 $15,688.27 $31,379.16 $3,221,426 $727,822 $3,949,248(1) Represents the amount levied in the indicated fiscal year. Excludes penalties and interest accrued. Other parcels were delinquent during Fiscal

Year 2008-09 or earlier fiscal years but paid the amounts due on or prior to September 15, 2009.(2) The City does not have information regarding the aggregate Fiscal Year 2009-10 tax levies for the parcels included within the District. Assuming

the Fiscal Year 2009-10 tax levies were approximately one percent of the Fiscal Year 2009-10 assessed value of $168,587,304, the Fiscal Year2008-09 delinquencies of $15,688.27 represent an approximately .93% delinquency rate on taxes levied on the parcels with unpaid assessments.Other parcels were delinquent during Fiscal Year 2008-09 but paid the amounts due on or prior to September 15, 2009.

(3) The September 15, 2009, delinquencies of $31,379.16 represent approximately .79% of the assessed value of the delinquent parcels.____________________Source: Harris & Associates; County Treasurer-Tax Collector.

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BOND OWNERS’ RISKS

In addition to the other information contained in this Official Statement, the following risk factorsshould be carefully considered in evaluating the investment quality of the Bonds. The City cautionsprospective investors that this discussion does not purport to be comprehensive or definitive and does notpurport to be a complete statement of all factors which may be considered as risks in evaluating thecredit quality of the Bonds. The occurrence of one or more of the events discussed herein could adverselyaffect the ability or willingness of property owners in the District to pay their Assessment Installmentswhen due. Any such failure to pay Assessment Installments could result in the inability of the City tomake full and punctual payments of debt service on the Bonds. In addition, the occurrence of one ormore of the events discussed herein could adversely affect the value of the property in the District.

General

In order to pay debt service on the Bonds, it is necessary that unpaid Assessment Installments on landwithin the District are paid in a timely manner. To the extent available, the Reserve Fund will be used to paydelinquent Assessment Installments should they occur. The assessments are secured by a lien on the parcels ofland located in the District and the City may institute foreclosure proceedings to sell land with delinquentAssessment Installments for the amount of such delinquent installments in order to obtain funds to paydebt service on the Bonds.

Failure by owners of the parcels to pay Assessment Installments when due, depletion of theReserve Fund or the inability of the City to sell parcels which have been subject to foreclosure proceedings foramounts sufficient to cover the delinquent Assessment Installments for such parcels may result in theinability of the City to make full or punctual payments of debt service on the Bonds, and Bond Ownerswould therefore be adversely affected.

Risks of Real Estate Secured Investments Generally

The Bond Owners will be subject to the risks generally incident to an investment secured by real estate,including, without limitation, (i) adverse changes in local market conditions, such as changes in the market value ofreal property in the vicinity of the District, the supply of or demand for comparable properties in such area and themarket value of residential or commercial property in the event of sale or foreclosure; (ii) changes in real estate taxrate and other operating expenses, governmental rules (including, without limitation, zoning laws and laws relatingto endangered species and hazardous materials) and fiscal policies; and (iii) natural disasters (including, withoutlimitation, earthquakes, tsunamis, fires and floods), which may result in uninsured losses.

Unpaid Assessment Installments do not constitute a personal indebtedness of the owners of the parcelswithin the District. There is no assurance the owners will be able to pay the Assessment Installments orthat they will pay such installments even if financially able to do so.

Foreclosure Shortfall

Amendments to the 1915 Act enacted in 1988 and effective January 1, 1989, provide that under certaincircumstances property may be sold upon foreclosure at a lesser Minimum Price or without a Minimum Price.“Minimum Price” as used in the 1915 Act is the amount equal to the delinquent installments of principal orinterest of the assessment or assessment, together with all interest, penalties, costs, fees, charges and otheramounts more fully detailed in the 1915 Act. The court may authorize a sale at less than the Minimum Price ifthe court determines that sale at less than the Minimum Price will not result in an ultimate loss to theBond Owners or, under certain circumstances, if owners of 75% or more of the outstanding Bonds consentto such sale. There can be no assurance that foreclosure proceedings will occur in a timely manner so as to

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avoid depletion of the Reserve Fund and a delay in payments of debt service on the Bonds. See “SECURITYFOR THE BONDS – Covenant for Superior Court Foreclosure – Judicial Foreclosure Proceedings.”

Property Tax Delinquencies

As of September 15, 2009, $15,688.27 of the property taxes levied in Fiscal Year 2008-09remained delinquent, representing approximately .93% of the property taxes levied on the parcels that didnot pay the assessments during the cash collection period. Property taxes for Fiscal Year 2009-10 are notyet due. The delinquency rate relating to property taxes reflects payment on or before September 15, 2009 ofdelinquency property taxes and may not be indicative of future delinquency rates for the AssessmentInstallments.

Delinquency Resulting in Ultimate or Temporary Loss on Bonds

If a temporary deficiency occurs in the Redemption Fund with which to pay principal and interestdue on Bonds that have then matured, past due interest or the principal and interest on Bonds coming dueduring the current year, but it does not appear to the City Treasurer that there will be an ultimate loss to theBond Owners, the City Treasurer shall cause the Paying Agent to pay the principal of Bonds which havematured as presented and make interest payments on the Bonds when due, as long as there are available fundsin the Redemption Fund, in the order of priority and as required by the Indenture. If it appears to the CityTreasurer that there is a danger of an ultimate loss accruing to the Bond Owners for any reason, he or sheis required pursuant to the 1915 Act to withhold payment on all matured Bonds and interest on all Bondsand report the facts to the City Council so that the City Council may take proper action to equitably protectall Bond Owners.

Concentration of Ownership

Ownership of the parcels is concentrated among approximately 203 property owners. See “THEDISTRICT – Top Ten Property Owners.” The timely payment of the Assessment Installment will dependupon the willingness and ability of the owners of the parcels to pay such installments when due. The Cityhas not undertaken to assess the financial condition of the owners of the parcels or the likelihood that theywill pay or will be able to pay the Assessment Installments when due and expresses no view concerningthese matters.

Non-Cash Payments of Assessments

The 1915 Act may permit the owner of a parcel that is subject to an unpaid Assessment Installment totender any bond secured by such assessment in payment or partial payment of any installment of theassessment or interest or penalties thereon which may be due or payable. A bond so tendered is to beaccepted at the par amount thereof and credit is to be given for any interest thereon accrued to the date ofthe tender. Thus, if Bonds can be purchased at a discount, it may be to the advantage of a property owner topay amounts due with respect to an assessment by tendering a Bond. Such a practice would decreasethe cash flow available to the City to make payments with respect to other Bonds then outstanding and couldresult in a default in payment on the Bonds.

Land Values

The value of the property within the District is a critical factor in determining the investment qualityof the Bonds. If a property owner is delinquent in the payment of Assessment Installments, the District’s onlyremedy is to commence foreclosure proceedings against the delinquent parcel in an attempt to obtain funds topay the delinquent Assessment Installments. Reductions in property values due to a downturn in the economy,physical events, such as earthquakes, tsunamis, fires or floods, stricter land use regulations, delays in

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development or other events will adversely impact the security underlying the assessments. See “THEDISTRICT – Assessed Value-to-Lien Ratios” herein.

The assessed values of the property within the District contained herein do not represent market valuesarrived at through an appraisal process and generally reflect only the sales price of a parcel when acquired byits current owner, adjusted annually by an amount determined by the County Assessor not to exceed anincrease of more than 2% per fiscal year. No assurance can be given that a parcel could actually be sold for itsassessed value. No assurance can be given that the values of the property within the District will not decline inthe future if one or more events, such as natural disasters or adverse economic conditions, occur.

No assurance can be given that any bid will be received for a parcel with delinquent AssessmentInstallments offered for sale at foreclosure or, if a bid is received, that such bid will be sufficient to pay alldelinquent Assessment Installments. See “SECURITY FOR THE BONDS – Covenant for Superior CourtForeclosure.”

Limited City Obligation Upon Delinquency

Pursuant to the 1915 Act, the City has elected not to be obligated to advance funds from the treasuryof the City for delinquent Assessment Installments. The only obligation of the City with respect to suchdelinquencies and the consequent deficiencies in the Redemption Fund is to advance money to theRedemption Fund from the Reserve Fund. The City has no obligation to replenish the Reserve Fundexcept to the extent that delinquent Assessment Installments are paid or proceeds from foreclosure sales arerealized. There is no assurance that the balance in the Reserve Fund will always be adequate to pay alldelinquent Assessment Installments and if during the period of delinquency there are insufficient funds in theReserve Fund, a delay may occur in payments to the Bond Owners.

Collection of the Assessments

The Assessment Installments are to be collected in the same manner as ordinary ad valorem realproperty taxes are collected and, except as provided in the special covenant for foreclosure in the Indenture, areto be subject to the same penalties and the same procedure, sale and lien priority in case of delinquency as isprovided for ad valorem real property taxes. Pursuant to these procedures, if taxes are unpaid for a periodof five years or more, the property may be deeded to the State and then is subject to sale by the County.

Pursuant to the 1915 Act, in the event any delinquency in the payment of an Assessment Installmentoccurs, the City may commence an action in superior court to foreclose the lien therefor within the specifiedtime limits. In such an action, the real property subject to the unpaid amount may be sold at judicialforeclosure sale. Such judicial foreclosure action is not mandatory. Amendments to the 1915 Act enacted in1988 and effective January 1, 1989, provide that under certain circumstances property may be sold uponforeclosure at a lesser Minimum Price or without a Minimum Price. The court may authorize a sale at lessthan the Minimum Price if the court determines that sale at less than Minimum Price will not result in anultimate loss to the Bond Owners or, under certain circumstances, if owners of 75% or more of theoutstanding Bonds consent to such sale. See “SECURITY FOR THE BONDS – Covenant for SuperiorCourt Foreclosure – Judicial Foreclosure Proceeding.”

There can be no assurance that foreclosure proceedings will occur in a timely manner so as to avoid adelay in payments of debt service on the Bonds. The City has covenanted that the City will commenceforeclosure upon the occurrence of a delinquency as provided in the Indenture and thereafter diligentlyprosecute an action in the superior court to foreclose the lien of the delinquent Assessment Installmentsagainst parcels of land in the District for which such installment has been billed but has not been paid and willdiligently prosecute and pursue such foreclosure proceedings to judgment and sale, all as provided in theIndenture. See “SECURITY FOR THE BONDS – Covenant for Superior Court Foreclosure.” In the eventthat sales or foreclosures of property are necessary, there could be a delay in payments on the Bonds

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pending such sales or the prosecution of foreclosure proceedings and receipt by the City of the proceeds ofsale.

Availability of Funds to Pay Delinquent Assessment Installments

Upon receipt of the proceeds from the sale of the Bonds, the City will initially establish theReserve Fund in the amount of the “Reserve Requirement.” The moneys in the Reserve Fund constitute atrust fund for the benefit of the Bond Owners, will be held by the Paying Agent and will be administered bythe Paying Agent in accordance with and pursuant to the provisions of the Indenture. If a deficiencyoccurs in the Redemption Fund for payment of interest on or principal of the Bonds, the Paying Agent willtransfer into such fund an amount out of the Reserve Fund needed to pay debt service on the Bonds. Thereis no assurance that the balance in the Reserve Fund will always be adequate to pay the debt service on theBonds in the event of delinquent Assessment Installments.

If, during the period of delinquency, there are insufficient funds in the Reserve Fund to pay theprincipal of and interest on the Bonds as they become due, a delay may occur in payment of principal and/orinterest to the owners of the Bonds.

Owner Not Obligated to Pay Assessments

Unpaid assessments do not constitute a personal indebtedness of the owner of parcels within theDistrict, and the property owners have made no commitment to pay the principal of or interest on the Bondsor to support payment of the Bonds in any manner. There is no assurance that the property owners havethe ability to pay the Assessment Installments or that, even if they have the ability, they will choose to paysuch Assessment Installments. An owner may elect not to pay the assessments when due and cannot be legallycompelled to do so. If an owner decides it is not economically feasible to develop or to continue owning itsproperty encumbered by the lien of the assessment, or decides that for any other reason it does not want toretain title to the property, such owner may choose not to pay assessments and to allow the property to beforeclosed. Such a choice may be made due to a decrease in the market value of the property. Aforeclosure of the property will result in such owner’s interest in the property being transferred to anotherparty. Neither the City nor any Bond Owner will have the ability at any time to seek payment directlyfrom any owner of property within the District of any assessment or any principal or interest due on the Bondsor the ability to control who becomes a subsequent owner of any property within the District.

Parity Taxes and Special Assessments; Future Indebtedness

The ability or willingness of a property owner in the District to pay the Assessment Installmentscould be affected by the existence of other taxes and assessments imposed upon the property. Theassessments and any penalties thereon constitute a lien against the lots and parcels of land on which theyhave been levied until they are paid. Such lien is subordinate to all fixed special assessment lienspreviously imposed on the same property but has priority over all existing and future private liens and overall fixed special assessment liens which may thereafter be created against the property. Such lien is co-equal to and independent of the lien for general property taxes and the lien for any community facilitiesdistrict special taxes regardless of when they are imposed upon the same property. In addition, otherpublic agencies whose boundaries overlap those of the District could, with or in some circumstances withoutthe consent of the owners of the land in the District, impose additional taxes or assessment liens on theproperty in the District in order to finance public improvements to be located inside or outside of theDistrict.

The City, however, has no control over the ability of other entities and districts to issue indebtednesssecured by special taxes or assessments payable from all or a portion of the property in the District. Inaddition, the City has not prohibited itself from establishing assessment districts, community facilitiesdistricts or other districts which might impose assessments or taxes against property in the District. The

22

imposition of additional liens on a parity with the assessments could reduce the ability or willingness ofthe owners of parcels in the District to pay the assessments and increases the possibility that foreclosureproceeds will not be adequate to pay delinquent assessments or the principal of and interest on the Bonds whendue. See “THE DISTRICT – Estimated Direct and Overlapping Indebtedness.”

Except for assessments securing the Bonds and direct and overlapping tax and assessment debtreferenced in Table 3, the City is not aware of any assessment liens on the property in the District.

Bankruptcy and Foreclosure

The payment of the assessments and the ability of the City to foreclose the lien of a delinquent unpaidassessment, as discussed in “SECURITY FOR THE BONDS – Covenant for Superior Court Foreclosure,”may be limited by bankruptcy, insolvency or other laws generally affecting creditors’ rights or by the lawsof the State of California relating to judicial foreclosure. In addition, the prosecution of a foreclosureaction could be delayed due to crowded local court calendars, delays in the legal process and proceduraldelaying tactics.

The various legal opinions to be delivered concurrently with the delivery of the Bonds (includingBond Counsel’s approving legal opinion) will be qualified as to the enforceability of the various legalinstruments by bankruptcy, insolvency, reorganization, moratorium and other similar laws affecting creditors’rights, by the application of equitable principles and by the exercise of judicial discretion in appropriate cases.

Although bankruptcy proceedings would not cause the assessments to become extinguished,bankruptcy of a property owner or of a partner or other equity owner of a property owner could result in astay in the enforcement of the lien for the assessment, a delay in prosecuting superior court foreclosureproceedings or adversely affect the ability or willingness of a property owner to pay the AssessmentInstallments and could result in delinquent Assessment Installments not being paid in full. In addition, theamount of any lien on property securing the payment of delinquent Assessment Installments could bereduced if the value of the property were determined by the bankruptcy court to have become less than theamount of the lien and the amount of the delinquent Assessment Installments in excess of the reduced liencould then be treated as an unsecured claim by the court. Any such stay of the enforcement of the lien, orany such delay or nonpayment, would increase the likelihood of a delay or default in payment of theprincipal of and interest on the Bonds and the possibility of delinquent Assessment Installments not beingpaid in full. Where property is encumbered by liens securing mortgage loans, it is highly probable thatbankruptcy of a property owner would delay foreclosure for an extended period of time. Such a delay wouldincrease the likelihood of a delay or default in payment of the principal and interest on the Bonds.

FDIC/Federal Government Interests in Parcels

The ability of the City to collect interest and penalties specified by the 1915 Act and to foreclose thelien of delinquent Assessment Installments may be limited in certain respects with regard to parcels inwhich the Federal Deposit Insurance Corporation (the “FDIC”), the Internal Revenue Service, the DrugEnforcement Agency or other similar federal government agencies has or obtains an interest.

Specifically, with respect to the FDIC, in the event that any financial institution making a loanwhich is secured by parcels is taken over by the FDIC and the applicable Assessment Installment is not paid,the remedies available to the City may be constrained. The FDIC’s policy statement regarding the payment ofstate and local real property taxes (the “Policy Statement”) provides that taxes other than ad valorem taxeswhich are secured by a valid lien in effect before the FDIC acquired an interest in a property will be paidunless the FDIC determines that abandonment of its interests is appropriate. The Policy Statementprovides that the FDIC generally will not pay installments of non-ad valorem taxes, such as theAssessment Installments, which are levied after the time the FDIC acquires its fee interest, nor will theFDIC recognize the validity of any lien to secure payment except in certain cases where the Resolution Trust

23

Corporation had an interest in property on or prior to December 31, 1995. Moreover, the Policy Statementprovides that, with respect to parcels on which the FDIC holds a mortgage lien, the FDIC will not permit itslien to be foreclosed out by a taxing authority without its specific consent, nor will the FDIC pay orrecognize liens for any penalties, fines or similar claims imposed for the non-payment of taxes.

The City is unable to predict what effect the application of the Policy Statement would have in theevent of a delinquency with respect to a portion of the parcels in which the FDIC has or obtains an interest,although prohibiting the lien of the FDIC to be foreclosed out at a judicial foreclosure sale would prevent ordelay the foreclosure sale.

Natural Disasters

Property within the District may be subject to unpredictable seismic activity, fires, floods or othernatural disasters. Southern California is a seismically active area. Seismic activity represents a potentialrisk for damage to buildings, roads and property within the District. In addition, land susceptible toseismic activity may be subject to liquefaction during the occurrence of such event.

Homes within the District near the shore of the Pacific Ocean are susceptible to flooding as a resultof high tides from the Pacific Ocean. The City currently uses a “tidal valve” system to prevent flooding andto protect the homes. No assurances can be given that such system will always protect homes in the Districtnear the shore of the Pacific Ocean from high tides and flooding. Should such homes be damaged ordestroyed as a result of flooding, owners of such homes may be unable or unwilling to pay the AssessmentInstallments when due.

In the event of a severe earthquake, tsunami, fire, flood or other natural disaster, there may besignificant damage to both property and infrastructure in the District. As a result, a substantial portion ofthe property owners may be unable or unwilling to pay the Assessment Installments when due. In addition,the value of land in the District could be diminished in the aftermath of such a natural disaster, reducingthe resulting proceeds of foreclosure sales in the event of delinquencies in the payment of the AssessmentInstallments.

Hazardous Substances

While government taxes, assessments and charges are a common claim against the value of a parcel,other less common claims may also be relevant. The value of a parcel may be reduced as a result of a claimwith regard to a hazardous substance. In general, the owners and operators of a parcel may be required bylaw to remedy conditions relating to releases or threatened releases of hazardous substances. The federalComprehensive Environmental Response, Compensation and Liability Act of 1980, sometimes referred to as“CERCLA” or the “Super Fund Act,” is the most well known and widely applicable of these laws, butCalifornia laws with regard to hazardous substances are also stringent and similar in effect. Under manyof these laws, the owner (or operator) is obligated to remedy a hazardous substance condition of a parcelwhether or not the owner (or operator) had anything to do with creating or handling the hazardoussubstance. The effect, therefore, should any of the parcels within the District be affected by a hazardoussubstance, is to reduce the marketability and value by the costs of remedying the condition because theprospective purchaser of such a parcel will, upon becoming the owner of such parcel, become obligated toremedy the condition just as the seller of such a parcel is so obligated.

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No Acceleration

The Bonds do not contain a provision allowing for the acceleration of the Bonds in the event of apayment default or other default under the terms of the Bonds or the Indenture. There is no provision inthe Act or the Indenture for acceleration of the Assessment Installments in the event of a payment defaultby an owner of a parcel or otherwise, or upon any adverse change in the tax status of interest on theBonds. Pursuant to the Indenture, a Bond Owner is given the right for the equal benefit and protection ofall Bond Owners to pursue certain remedies described in APPENDIX C – “SUMMARY OF CERTAINPROVISIONS OF THE INDENTURE.”

Loss of Tax Exemption

As discussed under the heading “CONCLUDING INFORMATION – Tax Matters,” interest onthe Bonds could cease to be excluded from gross income for purposes of federal income taxation, retroactiveto the date the Bonds were issued as a result of acts or omissions of the City in violation of certainprovisions of the Code and the covenants of the Indenture. In order to maintain the exclusion from grossincome for federal income tax purposes of the interest on the Bonds, the City has covenanted in theIndenture not to take any action, or fail to take any action, if such action or failure to take such actionwould adversely affect the exclusion from gross income of interest on the Bonds under Section 103 of theInternal Revenue Code of 1986, as amended. Should such an event of taxability occur, the Bonds are notsubject to early redemption and will remain outstanding to maturity or until redeemed under the optionalredemption provisions of the Indenture. See “THE BONDS – Redemption.”

Future legislative proposals, if enacted into law, clarification of the Code or court decisions maycause interest on the Bonds to be subject, directly or indirectly, to federal income taxation or to be subjectto or exempted from state income taxation, or otherwise prevent beneficial owners from realizing the fullcurrent benefit of the tax status of such interest. The introduction or enactment of any such futurelegislative proposals, clarification of the Code or court decisions may also affect the market price for, ormarketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisorsregarding any pending or proposed federal or state tax legislation, regulations or litigation, as to whichBond Counsel expresses no opinion.

IRS Audit of Tax-Exempt Bond Issues

The Internal Revenue Service has initiated an expanded program for the auditing of tax-exemptbond issues, including both random and targeted audits. It is possible that the Bonds will be selected foraudit by the Internal Revenue Service. It is also possible that the market value of the Bonds might beaffected as a result of such an audit of the Bonds (or by an audit of similar bonds).

Limited Secondary Market

There can be no guarantee that there will be a secondary market for the Bonds or, if a secondarymarket exists, that such Bonds can be sold for any particular price. Although the City has committed toprovide certain statutorily-required financial and operating information, there can be no assurance that suchinformation will be available to Bond Owners on a timely basis. The failure to provide the required annualfinancial information does not give rise to monetary damages but merely an action for specific performance.Occasionally, because of general market conditions, lack of current information, the absence of a creditrating for the Bonds or because of adverse history or economic prospects connected with a particular issue,secondary marketing practices in connection with a particular issue are suspended or terminated.Additionally, prices of issues for which a market is being made will depend upon then prevailingcircumstances. Such prices could be substantially different from the original purchase price.

25

Ballot Initiatives and Legislative Measures

From time to time constitutional initiatives or other initiative measures may be adopted byCalifornia voters and the State legislature has in the past enacted legislation which has altered thespending limitations or established minimum funding provisions for particular activities. The adoption ofany such initiative or legislation might place limitations on the ability of the State, the County or localdistricts to increase revenues or to increase appropriations.

Constitutional Amendment – Articles XIIIC and XIIID

An initiative measure commonly referred to as the “Right to Vote on Taxes Act” (the “Initiative”) wasapproved by the voters of the State of California at the November 5, 1996, general election. The Initiativeadded Article XIIIC (“Article XIIIC”) and Article XIIID (“Article XIIID”) to the California Constitution.According to the “Title and Summary” of the Initiative prepared by the California Attorney General, theInitiative limits “the authority of local governments to impose taxes and property-related assessments, fees andcharges.”

Article XIIID requires that, beginning July 1, 1997, the proceedings for the levy of any assessmentby the City under the 1913 Act (including, if applicable, any increase in such assessment or anysupplemental assessment under the 1913 Act) must be conducted in conformity with the provisions ofSection 4 of Article XIIID. The City completed its proceedings for the levy of assessments in the Districton July 28, 2009, after complying with the procedural requirements of Section 4 of Article XIIID. UnderSection 10400 of the 1913 Act, any challenge to the proceedings or the Assessment must be broughtwithin 30 days after the date the assessment was levied.

Article XIIIC removes limitations on the initiative power in matters of local taxes, assessments, feesand charges. Article XIIIC does not define the term “assessment,” and it is unclear whether this term isintended to include assessments levied under the 1913 Act. In the case of the unpaid assessments which arepledged as security for payment of the Bonds, the 1915 Act provides a mandatory, statutory duty of the Cityand the County Auditor to post Assessment Installments on account of the unpaid assessments to the propertytax roll of the County each year while any Bonds are outstanding, commencing with property tax year 2009-10, in amounts equal to the principal of and interest on the Bonds coming due in the succeeding calendar year,plus certain administrative costs. Although the matter is not free from doubt, it is unlikely that a court wouldhold that the initiative power can be used to reduce or repeal the unpaid assessments which are pledged assecurity for payment of the Bonds or to otherwise interfere with performance of the mandatory, statutoryduty of the City and the County Auditor with respect to the unpaid assessments which are pledged assecurity for payment of the Bonds.

The interpretation and application of the Initiative will ultimately be determined by the courtswith respect to a number of the matters discussed above, and it is not possible at this time to predict withcertainty the outcome of such determination.

26

CONCLUDING INFORMATION

Continuing Disclosure

The City has agreed to execute a Disclosure Dissemination Agent Agreement (the “DisclosureAgreement”) prior to delivery of the Bonds for the benefit of the Underwriter, holders and beneficial ownersof the Bonds to provide certain financial information and operating data relating the District not later thanMarch 31 after the end of the City’s fiscal year (the “Annual Report”) and to provide notices of theoccurrence of certain enumerated events (the “Listed Events”). Each Annual Report will be filed onbehalf of the City by the Dissemination Agent with the Municipal Securities Rulemaking Bond (the“MSRB”) through the Electronic Municipal Market Access system (the “EMMA System”) in anelectronic format and accompanied by identifying information as prescribed by the MSRB, with a copy tothe Paying Agent and the Underwriter. Any Notice Event (as defined in the Disclosure DisseminationAgent Agreement) will be filed by the City or the Dissemination Agent on behalf of the City, with theMSRB through the EMMA System. The specific nature of the information to be included in the AnnualReport and the notices of Notice Events is set forth in APPENDIX F – “DISCLOSURE DISSEMINATIONAGENT AGREEMENT.” The City has agreed to execute the Disclosure Agreement in order to assist theUnderwriter in complying with Securities and Exchange Commission Rule 15c2-12(b)(5) (the“Rule”). See APPENDIX F – “DISCLOSURE DISSEMINATION AGENT AGREEMENT.”

It should be noted that the City is required to file certain financial statements with the Annual Report.This requirement has been included in the Disclosure Agreement solely to satisfy the provisions of the Rule.The inclusion of this information does not mean that the Bonds are secured by any resources or property ofthe City other than as described hereinabove. See “BOND OWNERS’ RISKS – Limited City ObligationUpon Delinquency.” It should also be noted that the list of significant events which the City has agreed toreport includes one item which has absolutely no application to the Bonds. These items have been included inthe list solely to satisfy the requirements of the Rule. Any implication from the inclusion of these items inthe list to the contrary notwithstanding, the Bonds have not been assigned a credit rating.

The City has never failed to comply in all material respects with any previous undertakings withregard to the Rule to provide annual reports or notices of material events.

Legal Opinion

All proceedings in connection with the issuance of the Bonds are subject to the approval of Meyers,Nave, Riback, Silver & Wilson, a Professional Law Corporation, Bond Counsel (“Bond Counsel”). Theopinion of Bond Counsel attesting to the validity of the Bonds will be delivered with each Bond. A form ofthe opinion to be delivered by Bond Counsel is set forth in Appendix D hereto.

The descriptions of the Bonds and statements of law and legal conclusions set forth in this OfficialStatement under the headings “THE BONDS,” “SECURITY FOR THE BONDS,” “CONCLUDINGINFORMATION – Tax Matters” and Appendices C and D herein have been reviewed by Bond Counsel.Bond Counsel’s engagement is limited to a review of the legal procedures required for the authorization of theBonds and the exemption of interest on the Bonds from income taxation. See “CONCLUDINGINFORMATION – Tax Matters” herein. The opinion of Bond Counsel will not consider or extend to anydocuments, agreements, representations, offering circulars or other material of any kind concerning the Bonds,including the Official Statement, not mentioned in this paragraph.

27

Tax Matters

In the opinion of Meyers, Nave, Riback, Silver & Wilson, a Professional Law Corporation, BondCounsel, based upon an analysis of existing laws, regulations, rulings and court decisions, and assuming,among other things, the accuracy of certain representations and compliance with certain covenants,interest on the Bonds is excluded from gross income for federal income tax purposes under Section 103 ofthe Code and is exempt from State of California personal income taxes. In the further opinion of BondCounsel, interest on the Bonds is not a specific preference item for purposes of the federal individual orcorporate alternative minimum taxes, although Bond Counsel observes that such interest is included inadjusted current earnings when calculating corporate alternative minimum taxable income. Bond Counselexpresses no opinion regarding any other tax consequences related to the ownership or disposition of, orthe accrual or receipt of interest on, the Bonds. A complete copy of the proposed form of opinion ofBond Counsel is set forth in Appendix D hereto.

To the extent the issue price of any maturity of the Bonds is less than the amount to be paid atmaturity of such Bonds (excluding amounts stated to be interest and payable at least annually over theterm of such Bonds), the difference constitutes “original issue discount,” the accrual of which, to theextent properly allocable to each beneficial owner thereof, is treated as interest on the Bonds which isexcluded from gross income for federal income tax purposes and State of California personal incometaxes. For this purpose, the issue price of a particular maturity of the Bonds is the first price at which asubstantial amount of such maturity of the Bonds is sold to the public (excluding bond houses, brokers orsimilar persons or organizations acting in the capacity of underwriters, placement agents or wholesalers).The original issue discount with respect to any maturity of the Bonds accrues daily over the term tomaturity of such Bonds on the basis of a constant interest rate compounded semiannually (with straight-line interpolations between compounding dates). The accruing original issue discount is added to theadjusted basis of such Bonds to determine taxable gain or loss upon disposition (including sale,redemption or payment on maturity) of such Bonds. Beneficial owners of the Bonds should consult theirown tax advisors with respect to the tax consequences of ownership of such Bonds with original issuediscount, including the treatment of beneficial owners who do not purchase such Bonds in the originaloffering to the public at the first price at which a substantial amount of such Bonds is sold to the public.

Bonds purchased, whether at original issuance or otherwise, for an amount higher than theirprincipal amount payable at maturity (or, in some cases, at their earlier call date) (“Premium Bonds”) willbe treated as having amortizable bond premium. No deduction is allowable for the amortizable bondpremium in the case of Bonds, like the Premium Bonds, the interest on which is excluded from grossincome for federal income tax purposes. However, the amount of tax-exempt interest received, and abeneficial owner’s basis in a Premium Bond, will be reduced by the amount of amortizable bond premiumproperly allocable to such beneficial owner. Beneficial owners of Premium Bonds should consult theirown tax advisors with respect to the property treatment of amortizable bond premium in their particularcircumstances.

The Code imposes various restrictions, conditions and requirements relating to the exclusion fromgross income for federal income tax purposes of interest on obligations such as the Bonds. The City, asissuer of the Bonds, has made certain representations and covenanted to comply with certain restrictions,conditions and requirements designed to ensure that interest on the Bonds will not be included in federalgross income. Inaccuracy of these representations or failure to comply with these covenants may result ininterest on the Bonds being included in gross income for federal income tax purposes, possibly from thedate of original issuance of the Bonds. The opinion of Bond Counsel assumes the accuracy of theserepresentations and compliance with these covenants. Bond Counsel has not undertaken to determine (orto inform any person) whether any actions taken (or not taken), or events occurring (or not occurring), orany other matters coming to Bond Counsel’s attention after the date of issuance of the Bonds mayadversely affect the value of, or the tax status of interest on, the Bonds.

28

Certain requirements and procedures contained or referred to in the Indenture, the Tax Certificateand other relevant documents may be changed and certain actions (including, without limitation,defeasance of the Bonds) may be taken or omitted under the circumstances and subject to the terms andconditions set forth in such documents. Bond Counsel expresses no opinion as to any Bond or the interestthereon if any such change occurs or action is taken or omitted upon the advice or approval of any personother than Meyers, Nave, Riback, Silver & Wilson, a Professional Law Corporation.

Although Bond Counsel is of the opinion that interest on the Bonds is excluded from grossincome for federal income tax purposes and is exempt from State of California personal income taxes, theownership or disposition of, or the accrual or receipt of interest on, the Bonds may otherwise affect abeneficial owner’s federal, state or local tax liability. The nature and extent of these other taxconsequences depends upon the particular tax status of the beneficial owner or the beneficial owner’sother items of income or deduction. Bond Counsel expresses no opinion regarding any such other taxconsequences.

Future legislation, if enacted into law, or clarification of the Code may cause interest on theBonds to be subject, directly or indirectly, to federal income taxation, or otherwise prevent beneficialowners from realizing the full current benefit of the tax status of such interest. The introduction orenactment of any such future legislation or clarification of the Code may also affect the market price for,or marketability of, the Bonds. Prospective purchasers of the Bonds should consult their own tax advisersregarding any pending or proposed federal tax legislation, as to which Bond Counsel expresses noopinion.

The opinion of Bond Counsel is based on current legal authority, covers certain matters notdirectly addressed by such authorities, and represents Bond Counsel’s judgment as to the proper treatmentof the Bonds for federal income tax purposes. It is not binding on the Internal Revenue Service (the“IRS”) or the courts. Furthermore, Bond Counsel cannot give and has not given any opinion or assuranceabout the future activities of the City, or about the effect of future changes in the Code, the applicableregulations, the interpretation thereof or the enforcement thereof by the IRS. The City has covenanted,however, to comply with the requirements of the Code.

Bond Counsel’s engagement with respect to the Bonds ends with the issuance and delivery of theBonds, and, unless separately engaged, Bond Counsel is not obligated to defend the City or the beneficialowners regarding the tax-exempt status of the Bonds in the event of an audit examination by the IRS.Under current procedures, parties other than the City and its appointed counsel, including the beneficialowners, would have little, if any, right to participate in the audit examination process. Moreover, becauseachieving judicial review in connection with an audit examination of tax-exempt bonds is difficult,obtaining an independent review of IRS positions with which the City legitimately disagrees, may not bepracticable. Any action of the IRS, including but not limited to selection of the Bonds to audit, or thecourse or result of such audit, or the audit of bonds representing similar tax issues may affect the marketprice for, or the marketability of, the Bonds, and may cause the City or the beneficial owners to incursignificant expense.

No Litigation

There is no action, suit or proceeding known by the City to be pending at the present timerestraining or enjoining the delivery of the Bonds or in any way contesting or affecting the validity of theBonds or any proceedings of the City taken with respect to the execution or delivery thereof. A nolitigation certificate executed by the City will be required to be delivered to the Underwriter simultaneouslywith the delivery of the Bonds.

29

Rating

Standard & Poor‘s Ratings Group (“S&P”) has assigned its municipal rating of “A” to the Bonds.The rating reflects only the views of S&P and any explanation of the significance of the rating should beobtained from Standard & Poor’s Ratings Group, 55 Water Street, New York, New York 10041(212) 438-1000. There is no assurance that the rating will continue for any given period of time or that it willnot be revised or withdrawn entirely by S&P if, in the judgment of S&P, circumstances so warrant. Any suchdownward revision or withdrawal of the rating may have an adverse effect on the market price of the Bonds.The City has no obligation to maintain any rating for the Bonds.

Financial Interests

The fees being paid to the Financial Advisor, Disclosure Counsel and Bond Counsel are contingentupon the issuance and delivery of the Bonds.

Underwriting

The Bonds were sold to Southwest Securities, Inc. (the “Underwriter”) at a negotiated sale. TheUnderwriter has agreed to purchase the Bonds at a price of $3,260,728.24 ($3,295,700.00 par value, lessan Underwriter’s discount of $22,872.16 and less a net original issue discount of $12,099.60). The purchasecontract for the Bonds provides that the Underwriter will purchase all of the Bonds if any are purchased, theobligation to make such purchase is subject to certain terms and conditions set forth in such purchasecontract, the approval of certain legal matters by Bond Counsel and certain other conditions.

The Underwriter may offer and sell Bonds to certain dealers and others at prices lower than theoffering prices stated on the inside cover page hereof. The offering prices may be changed from time to timeby the Underwriter.

Financial Advisor

Fieldman, Rolapp & Associates, Irvine, California, served as financial advisor to the City withrespect to the sale of the Bonds. Fieldman, Rolapp & Associates will receive compensation contingent uponthe sale and delivery of the Bonds.

Miscellaneous

All quotations from, and summaries and explanations of, the Indenture and other statutes anddocuments contained herein do not purport to be complete, and reference is made to said documents, theIndenture and statutes for full and complete statements of their provisions.

This Official Statement is submitted only in connection with the sale of the Bonds by the City. Allestimates, assumptions, statistical information and other statements contained herein, while taken from sourcesconsidered reliable, are not guaranteed by the City. The information contained herein should not beconstrued as representing all conditions affecting the City or the Bonds.

30

The execution and delivery of this Official Statement have been authorized by the City.

CITY OF NEWPORT BEACH

By /s/ Edward D. SelichMayor

APPENDIX A

ASSESSMENT DIAGRAM

~

""' I>"

ID!roliMEDCOPY

ASSESSMENT DIAGRAM FOR ASSESSMENT DISTRICT No. 103

(G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard) CITY OF NEWPORT BEACH, COUNTY OF ORANGE

THE BOUNDARY OF THE PROPOSED ASSESSMENT DISTRICT COINCIDES WITH THE ASSESSOR'S PARCELS WITHIN THE BOUNDARY SHOWN ON THIS MAP. FOR PARTICUlARS OF LINES AND DIMENSIONS OF ASSESSOR'S PARCELS, REFERENCE IS MADE TO THE MAPS OF THE ORANGE COUNTY ASSESSOR, SPECIFICALLY BOOK 46 PAGES 19-22 & PAGES 25-:SO. ALL DIMENSIONS SHOWN HEREIN ARE PER TI-lE ASSESSOR'S PARCEL MAPS.

STATE OF CAUFORNIA

SCALE: 1" ~ 150'

';'4-

ACCEPTED AND FllED AT THE REQUEST OF

CITY OF NEYIPORT BEACH

DATE l!)! Y 2'j0 • WOC} TIME ot,:_;l. A(\o\ FEE$~ INSTRUMENT# ;;tpOSOOO'IOtJC)IS

38'

BOOK "'Y. PAGE~M OF MAPS OF ASSESSMENT AND COMMUNITY

FACIUTIES DISTRICTS IN THE OFFICE OF THE

RECORDER OF THE COUNTY OF ORANGE,

STATE OF CALIFORNIA.

TOM DALY

COUNTY CLERK RECORDER

BY'2,1J.~ DEPUTY

EXEMPT RECORDING PER

G.C. 6103

AN ASSESSMENT WAS LEVIED BY THE CITY COUNCIL ON

THE LOTS, PIECES AND PARCELS OF LAND SHOWN ON

THE ASSESSMEN1, 9.1{'-_GRAM. SAI®t(ESSMENT WAS LEVIED ON THE~A Y OF , 2009. REFERENCE IS MADE TO THE ASSESSMENT ROLL

RECORDED IN THE OFFICE OF THE SUPERINTENDENT OF STREETS FOR THE EXACT AMOUNT OF EACH ASSESSMENT LEVIED AGAINST THE PARCELS SHOWN ON THIS ASSESSM

~R,prrwv crrY RK

FILED IN THE OFFICE OF THE CITY CLERK OF THE CITY

OF NEWPORT BEACH THIS~ DAY OFJJJlt/--, 2009.

LEGEND:

~Q~ CITY CLERK1

ASSESSOR'S PARCEL LINE

LOT LINE

ASSESSMENT DISlRICT BOUNDARY

34 EXECUllVE PARK, SUITE 150, IRVINE, CA 92614-4705 (949) 655-3900

DATE 04/21/09 SHEEr ____!____ OF_§____

(}'-. IV)

:;,... cr-

~COPY

( G Street/East


Balboa Boulevard/Channel Road/Ocean CITY OF NEWPORT BEACH, COUNTY OF ORANGE

STATE OF CAUFORNIA !Assessor's Map Book o4~

E. BALBOA BOULEVARD

Boulevard)

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GRAPHIC SCALE 00 ~ 00 = ~

n ( IN FEET)

linch= 50ft

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--- ASSESSOR'S PARCEL LINE

------ LOT LINE

= .. 11 = ASSESSMENT DISTRICT BOUNDARY

@ ASSESSOR'S PAGE SECTION

CD ASSESSOR'S PARCEL NUMBER

0 POLES TO BE REMOVED

[j] ASSESSMENT NUMBER

• • • • • WIRES TO BE REMOVED

04/21/09 SHEET __g_ OF ____.§____

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!Assessor's Map Book 0481 STATE OF CALIFORNIA 50 25 50 100 200

E. BALBOA BOULEVARD E. BALBOA cc=cc=cc=cc=o::~c=~cc=c==cc==c==c==co::r=c==c==cc=c

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(~~~) ASSESSOR'S PAGE SECTION

(i) ASSESSOR'S PARCEL NUMBER


=:J I' ... I .. @ [W]

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STATE OF CALIFORNIA Irrrrl ,,, 1' T T f:) I clliJ

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11111 ASSESSMENT NUMBER


DO Harris & Associates PROGRAM MANAGERS DO CONSTRUCTION MANAGERS CIVIL ENGINEERS

31- EXECUTIVE CA 92614-4705

DATE 01/21/09 SHEEr ____±_____ OF~

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STATE OF CALIFORNIA

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34 EXECUTIVE PARK, SUITE 150, IRVlNE, CA 92614-4705 (949) 655-3900

DATE 04/21/09 SHEET __§___ OF~

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~ORMEDCOPY

( G Street/East

MATCHLINE


Balboa Boulevard/Channel Road/Ocean CITY OF NEWPORT BEACH, COUNTY OF ORANGE

STATE OF CALIFORNIA

Boulevard)

4LJ

f

LEGEND:

ASSESSOR'S PARCEL LINE

--- LOT LINE

= ., ,. = ASSESSMENT DISTRICT BOUNDARY

~-~ ASSESSOR'S PAGE SECTION

G) ASSESSOR'S PARCEL NUMBER


[JJ) ASSESSMENT NUMBER

• WIRES TO BE REMOVED

L.J3

B-1

APPENDIX B

INFORMATION ABOUT THE NEWPORT BEACH AREA

This appendix sets forth general information about the Newport Beach area. This information isincluded only for general background purposes. It is not intended to suggest that the Bonds are payablefrom any source other than the assessments and certain funds and accounts created by the Indenture.

General Description

The City of Newport Beach (the “City”) was incorporated September 1, 1906. The Council-Manager form of government was established by Municipal Charter on January 7, 1955. The City is locatedin Orange County, California, and is 75 miles north of San Diego, 15 miles south of Long Beach and 50 milessouth of Los Angeles. The tourist population is high throughout the year. Its harbor, recreation and specialattractions draw many to the City.

Climate & Topography

The City’s climate is moderate. Because the City is a beach city, temperatures are generallycooler in the summer and warmer in the winter than other Southern California areas. While much of theCity is just above sea level, the City does rise inland. The total area of the City in square miles is: Land–25.0,Bay–2.5 and Ocean–23.0, for a total of 50.5 square miles.

Population

The table below shows the recent population of the City and County of Orange (the “County”).

POPULATION GROWTH, 2005-2009City of Newport Beach and the County of Orange

YearCity of

Newport BeachCounty of

Orange2005 82,984 3,050,4032006 83,503 3,071,9242007 84,218 3,098,1212008 84,231 3,107,5002009 86,252 3,139,017

Source: California State Department of Finance, E-4 Population Estimates for Cities, Counties and the State, 2001-2009 with 2000DRU Benchmark.

B-2

Employment

The following table summarizes wage and salary employment in the County from 2004 throughJuly 2009. The total wage and salary employment in the County increased by 1.8% between 2004and 2008. “Service Providing” is the largest employment sector in the County.

ANNUAL AVERAGE INDUSTRY EMPLOYMENT(1)

Orange County Primary PMSA

2004 2005 2006 2007 2008 2009*Total Farm 6,700 5,600 5,300 5,000 4,700 3,400Total Nonfarm 1,456,700 1,491,000 1,518,900 1,515,500 1,484,700 1,416,500Total Private 1,303,300 1,335,600 1,362,200 1,356,200 1,322,600 1,261,700

Goods Producing 276,300 283,500 289,900 284,000 265,600 243,400Natural Resources and Mining 600 700 600 600 600 600Construction 92,200 99,900 106,600 103,100 91,200 79,000Manufacturing 183,500 182,900 182,700 180,400 173,800 163,800Service Providing 1,180,500 1,207,400 1,229,000 1,231,500 1,219,100 1,173,100Trade, Transportation and Utilities 264,900 269,800 272,800 277,000 270,900 252,600Wholesale Trade 82,400 83,000 83,700 86,900 85,900 79,200Retail Trade 153,200 158,100 160,800 161,200 155,700 144,800Transportation, Warehousing and Utilities 29,200 28,700 28,200 28,900 29,400 28,600

Information 33,800 32,800 31,900 31,200 30,100 27,800Financial Activities 132,300 138,400 138,200 127,700 113,700 108,600Professional and Business Services 254,900 264,300 274,500 273,300 267,900 256,300Educational and Health Services 131,000 133,500 137,700 142,600 149,600 149,300Government 153,400 155,300 156,700 159,400 162,100 154,800Total, All Industries 1,463,400 1,496,500 1,524,300 1,520,500 1,489,400 1,419,900

Note: The “Total All Industries” data is not directly comparable to the employment data found herein.

(1) Employment is reported by place of work; it does not include persons involved in labor-management disputes. Figuresare rounded to the nearest hundred. Columns may not add to totals due to rounding.*2009 data through July 2009.____________________Source: State of California, Employment Development Department, Orange PMSA Industry Employment & Labor Force by Annual

Average, March 2008 Benchmark.

B-3

The following table summarizes civilian labor force, employment and unemployment in the City, theCounty, the State of California (the “State”) and the United States of America from 2004 to 2009.

CIVILIAN LABOR FORCE, EMPLOYMENT AND UNEMPLOYMENTCity of Newport Beach, County of Orange, State of California and United States of America

Annual Averages, 2004-2009

Year and AreaCivilian Labor

ForceCivilian

Employment(1)Civilian

Unemployment(2)

CivilianUnemployment

Rate(3)

2004Newport Beach 44,500 43,400 1,200 2.6%Orange County 1,589,300 1,521,300 68,000 4.3California 17,655,000 16,576,000 1,080,000 6.2United States(4) 147,401,000 139,252,000 8,149,000 5.5

2005Newport Beach 45,200 44,200 1,100 2.3%Orange County 1,602,262 1,541,800 60,400 3.8California 17,695,600 16,746,900 948,700 5.4United States(4) 149,320,000 141,730,000 7,591,000 5.1



2008Newport Beach 45,900 44,000 1,500 3.3%Orange County 1,636,700 1,549,000 87,700 5.4California 18,391,800 17,059,600 1,332,300 7.2United States(4) 154,287,000 145,362,000 8,924,000 5.8

2009*

Newport Beach 45,400 42,700 2,700 6.0%Orange County 1,646,100 1,489,900 156,200 9.5California 18,457,700 16,375,700 2,082,000 11.3United States(4) 154,897,000 140,074,000 14,823,000 9.6

(1) Includes persons involved in labor-management trade disputes.(2) Includes all persons without jobs who are actively seeking work.(3) The unemployment rate is computed from unrounded data; therefore, it may differ from rates computed from rounded

figures in this table.(4) Not strictly comparable with data for prior years.*2009 data through July 2009._____________________Source: State of California, Employment Development Department, based on March 2008 benchmark and U.S. Department of

Labor, Bureau of Labor Statistics, Orange County, Employment Development Department, based on March 2007benchmark.

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Median Household Income

The following table summarizes the median household income for the City and the County, from2005 to 2007.

MEDIAN HOUSEHOLD INCOMECity of Newport Beach

2005 2006 2007Newport Beach 97,428 103,068 107,493County of Orange 65,953 70,232 73,107

______________________Source: U.S. Census Bureau.

Major Employers

The principal employers as of June 30, 2008, in the City are as follows:

PRINCIPAL EMPLOYERS (1)

City of Newport Beach

Name Type of Business or Entity Numbered EmployedHoag Memorial Hospital Hospital and health care 4,168Pacific Life Insurance Life insurance, investment 2,997US Bank Banking 2,234City of Newport Beach City government 827Pacific Investment Management Co. Investment company 735Jazz Semiconductor Semiconductor networking solutions 649The Island Hotel Hotel, resort 520Newport Beach Marriott & Tennis Club Hotels, resorts 473Conexant Systems Inc. Semiconductor networking solutions 290Mindspeed Technology Semiconductor networking solutions 280(1) Figures reflect number of employees of each employer as of June 30, 2008, and do not reflect current number of employees for

each employer.______________________Source: Newport Beach Chamber of Commerce.

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The largest private sector employers within the County reported as of November 24, 2008:

LARGEST PRIVATE SECTOR EMPLOYERS(1)

County of Orange

Name Type of Business or EntityNumber

EmployedWalt Disney Co. Entertainment 20,000University of California, Irvine Higher education and health care 17,500St. Joseph Health System Health care 10,656Boeing Co. Aerospace and communications 8,100Yum! Brands Inc. Fast food restaurants 7,000Target Corp. Retail 6,100Supervalu Grocery retailer 6,082California State University, Fullerton Higher education 5,768Bank of America Corp. Banking 5,500Kaiser Permanente Health care 5,496Home Depot Inc. Retail 5,450Memorial Health Services Health care 5,309Wal-Mart Stores Inc. Retail 5,260AT&T Inc. Telephone service 4,730Costco Wholesale Discount retailer 4,500The Kroger Co. Grocery retailer 4,500Hoag Memorial Hospital Presbyterian Hospital and health care 4,150Tenet Healthcare Corp. Health care 4,000Cedar Fair LP Entertainment 3,950CVS Caremark Corp. Pharmacy 3,920United Health Group Inc. Health care 3,900Irvine Company Residential and commercial development 3,700Edison International Utilities and investments 3,545Marriott International Inc. Hotels, resorts and senior living communities 3,379Automobile Club of Southern California Information systems, insurance and automotive assistance 3,325(1) Excludes public sector employment such as the federal government, the County, local cities, school districts and water districts and

other governmental agencies. Figures reflect number of employees of each employer as of November 24, 2008, and do not reflectcurrent number of employees for each employer.

______________________Source: Orange County Business Journal – 2009 Book of Lists.

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Construction Activity

The following table shows building permit valuations and new housing units in Newport Beach foryears 2004 through 2008.

City of Newport BeachBuilding Permit Valuation and New Housing Units

(Dollar Amounts Are Stated Fully)

2004 2005 2006 2007 2008ResidentialSingle-Family $ 56,021,134 $ 73,381,227 $ 82,967,310 $ 68,054,930 $ 82,504,056Multi-Family 31,833,538 7,658,741 7,450,000 11,283,560 9,791,756Alteration/Additions 50,009,411 53,783,612 56,805,626 58,058,723 49,507,192

Total $137,864,083 $136,823,580 $147,222,936 $137,397,213 $140,803,004

Non-ResidentialNew Commercial $ 7,746,165 $ 18,235,000 $ 36,300,000 $ 57,666,475 $ 17,000,000New Industry 0 0 0 2,000,000 0Other(1) 18,442,820 34,025,725 37,093,731 29,236,976 32,513,364Alteration/Additions 46,776,521 54,026,316 53,803,425 40,431,975 62,653,046

Total $ 72,965,506 $106,287,041 $127,197,156 $129,335,426 $112,166,410

Total All Industry(2) $210,829,589 $243,110,621 $274,420,092 $266,732,639 $252,969,414

New Housing UnitsSingle-Family Units 100 141 126 107 90Multi-Family Units 231 34 34 40 38

Total 331 175 160 147 128(1) Includes churches and religious building, hospitals and institutional buildings, schools and educational buildings, residential garages, public

works and utilities buildings and non-residential alterations and additions.(2) May not add up due to rounding.______________________Source: Construction Industry Research Board.

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Taxable Sales

Taxable sales in the City are shown below. Taxable sales in the City increased by 38.4% between2003 and 2007. The largest taxable sales sectors in the City are automotive, eating and drinking placesand general merchandise.

TAXABLE SALESCity of Newport Beach

2003-2008*(In Thousands)

Taxable Sales2003 2004 2005 2006 2007 2008*

Apparel $116,461 $138,308 $159,346 $168,773 $172,604 $77,006

General Merchandise 216,676 237,968 256,604 259,294 247,316 106,172

Food Stores 75,576 76,493 82,662 86,262 88,522 41,255

Eating and Drinking Places 309,219 344,205 381,592 392,918 403,373 194,803

Home Furnishings & Appliances 82,783 81,027 99,458 96,501 94,043 33,336

Building Materials and Farm Implements 21,369 25,548 29,130 30,566 29,774 13,152

Automotive 350,740 382,748 430,653 538,993 647,238 269,040

Service Station 61,231 74,715 89,411 105,462 116,143 67,592

Other Retail Stores 276,253 288,372 327,910 334,155 217,538 96,614

Total Retail Stores $1,510,308 $1,649,348 $1,856,766 $2,012,924 $2,016,551 $ 898,970

All Other Outlets 402,738 475,161 501,875 559,897 631,800 311,005

Total All Outlets $1,913,046 $2,124,545 $2,358,641 $2,572,821 $2,648,351 $1,209,975

* Includes 1st and 2nd Quarter of 2008.____________________Source: California Board of Equalization.

Assessed Valuation

Below is a table which indicates the secured, unsecured and total assessed valuations for the Cityfor the Fiscal Years 2005-06 through 2009-10:

Fiscal Year Secured Valuation State AssessedUnsecuredValuation

TotalAssessed Value

2005-06 $28,136,554,256 53,310 $1,914,106,993 $30,050,714,5592006-07 31,423,419,732 53,310 1,569,867,249 32,993,340,2912007-08 34,188,515,273 53,310 1,668,015,342 35,856,583,9252008-09 36,435,406,840 699,230 1,538,539,482 37,974,645,5522009-10 37,077,896,580 699,230 1,564,808,312 38,643,404,122

______________________Source: County of Orange Auditor-Controller’s Office.

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APPENDIX C

SUMMARY OF CERTAIN PROVISIONS OF THE INDENTURE

The following is a summary of certain provisions of the Indenture not otherwise summarizedin the text of this Official Statement. This summary does not purport to be complete or definitive and isqualified in its entirety by reference to the full terms of the Indenture. Purchasers of the bonds arereferred to the complete text of the Indenture, copies of which are available upon written request fromthe Paying Agent. Capitalized terms not otherwise defined herein shall have the meanings givensuch terms in the body of the Official Statement.

TRANSFER OF REGISTERED BONDS. Any Bond may, in accordance with its terms, be transferredupon the books of registration required to be kept by the Paying Agent pursuant to the provisions of theIndenture by the owner in whose name it is registered, or by his or her duly authorized attorney or legalrepresentative, upon surrender of such Bond for registration of such transfer, accompanied by delivery of awritten instrument of transfer in a form approved by the Paying Agent and duly executed by the owner of saidBonds.

The Paying Agent may require the payment by the Bond owner requesting such transfer of any tax orother governmental charge required to be paid with respect to such transfer and such charges as provided for inthe system of registration for registered debt obligations.

The Paying Agent may refuse to transfer or exchange either (i) any Bond during the period established bythe Paying Agent for the selection of Bonds for prepayment, or (ii) any Bond which the Paying Agent hasselected for prepayment in whole or in part under the provisions of the Indenture.

Upon any registration of transfer, a new Bond or Bonds shall be authenticated and delivered by thePaying Agent in exchange for such Bond, in the name of the transferee, in any denomination or denominationsauthorized by the Indenture and in an aggregate principal amount equal to the principal amount of such Bond orprincipal amount of such Bond or Bonds so surrendered.

EXCHANGE OF BONDS. Bonds may be exchanged at the Principal Office of the Paying Agent for a likeaggregate principal amount of Bonds of the same series, interest rate and maturity, subject to the payment ofany tax or governmental charges, if any, upon surrender and cancellation of the Bond. Upon such transfer andexchange, a new registered Bond or Bonds of any authorized denomination or denominations of the sameseries and maturity for the same aggregate principal amount will be issued to the transferee in exchange therefor.

The Paying Agent shall not be required to register the exchange of any Bonds during the fifteen(15) days preceding the selection of any Bonds for redemption prior to the maturity thereof, nor with respect toany Bond which has been selected for redemption prior to the maturity thereof.

MUTILATED, DESTROYED, STOLEN OR LOST BONDS. In case any Bond shall become mutilated or bedestroyed, stolen or lost, the City shall cause to be executed and authenticated a new Bond of like date and tenorand principal or maturity amount in exchange and substitution for and upon the cancellation of such mutilatedBond or in lieu of and in substitution for such Bond mutilated, destroyed, stolen or lost, upon the Bond owner’spaying reasonable expenses and charges in connection therewith, and, in the case of a Bond destroyed,stolen or lost, the filing by the Bond owner with the Paying Agent and City of evidence satisfactory to themthat such Bond was destroyed, stolen or lost, and of ownership thereof, and furnishing the Paying Agent and Citywith indemnity satisfactory to them.

OWNERSHIP OF BONDS. The person in whose name any Bond shall be registered shall be deemedand regarded by the Paying Agent and the City as the absolute owner thereof for all purposes and shall

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not be affected by any notice to the contrary, and payment of or on account of the principal andredemption premium, if any, of any such Bond, and the interest on any such Bond, shall be made only toor upon the order of the registered owner thereof or the owner’s legal representative shown on the booksof registration. All such payments shall be valid and effectual to satisfy and discharge the liability uponsuch Bond, including the redemption premium, if any, and interest thereon, to the extent of the sum orsums so paid.

UNCLAIMED FUNDS. Notwithstanding any provisions of the Indenture, subject to applicable state escheat laws,any moneys held by the Paying Agent in trust for the payment of the principal of, or premium, if any, or interest on,any Bonds and remaining unclaimed for one year after the principal of all of the Bonds has become due and payable(whether at maturity or upon call for redemption or by declaration as provided in the Indenture), if such moneyswere held at such date, or one year after the date of deposit of such moneys if deposited after said date when all ofthe Bonds became due and payable, shall be repaid to the City free from the lien created by the Indenture, and allliability of the Paying Agent with respect to such moneys shall thereupon cease and the Bond owners shall, uponsuch payment, look only to the City for payment; provided, however, that before the repayment of such moneys tothe City as aforesaid, the Paying Agent shall (at the written request and cost of the City) first publish at least once ina nationally recognized financial publication published in New York, New York, a notice, in such form as may bedeemed appropriate by the Paying Agent, with respect to the provisions relating to the repayment to the City of themoneys held for the payment thereof.

FUNDS AND ACCOUNTS. The Paying Agent and the City, as applicable, are authorized and directed toestablish the following funds for purposes of collecting Assessment Installments, making payment for thedesignated costs and expenses and payment of principal and interest on the Bonds pursuant to the Indenture.

Redemption Fund: The Paying Agent is authorized and directed to establish and maintain a Redemption Fund (asdefined in the Indenture) designated by the name of the District and to deposit therein from time to time (i) theamount of the proceeds of the Bonds which represents accrued and capitalized interest, if any, on the Bonds,(ii) all sums received from the City representing the collection of the assessments (other than assessments foradministrative costs) and the interest thereon, and (iii) any surplus in the Improvement Fund (as defined in theIndenture) to the extent as provided below.

Except for money received with respect to assessment surcharges for administrative costs, the Cityshall transfer or cause to be transferred to the Paying Agent all sums received and not previously transferredfrom the collection of the assessments and any interest thereon and all sums received for the partial or fullprepayment of assessments as required by Streets & Highways Code Section 8767.

Principal of and interest on the Bonds shall be paid by the Paying Agent to the registered owners outof the Redemption Fund to the extent funds on deposit in said Redemption Fund are available therefor. Under nocircumstances shall the Bonds or interest thereon be paid out of any other fund except as provided in theIndenture.

There shall be established by the Paying Agent a prepayment subaccount within the Redemption Fundto be known as the Prepayment Account (“Prepayment Account”). The Paying Agent shall not be required toestablish the Prepayment Account until the time when deposits are required to be made therein. The City shalltransfer to the Paying Agent for deposit in the Prepayment Account all moneys received by the Cityrepresenting the prepayment of the principal of, and interest and redemption premium on, any Bonds. Suchmoneys shall be applied solely to the payment of the principal of, and interest and premium on, Bonds to beredeemed prior to maturity pursuant to the provisions of the Indenture.

Reserve Fund: The City shall create and maintain a special reserve fund for the Bonds (the “Reserve Fund”).The City shall also deposit in the Reserve Fund funds which represent the proceeds of (i) payments made toredeem delinquent Assessment Installments or (ii) the judicial foreclosure sale of parcels pursuant to the

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Indenture, in each case if and to the extent that any advance was made from the Reserve Fund to theRedemption Fund as a result of such delinquencies.

Moneys in the Reserve Fund shall be applied as follows:

1. Amounts in the Reserve Fund shall be transferred to the Paying Agent for deposit in theRedemption Fund if there are insufficient moneys in the Redemption Fund to pay principal of and interest onthe Bonds when due. Amounts so transferred shall be repaid to the Reserve Fund from proceeds from theredemption or foreclosure of property with respect to which an assessment is unpaid and from payments of thedelinquent assessments.

2. Interest earned on the permitted investment of moneys on deposit in the Reserve Fund shallremain in the Reserve Fund to the extent required to maintain the Reserve Fund at the Reserve Requirement.Not later than July 15 of each fiscal year, the amount on deposit in the Reserve Fund in excess of the ReserveRequirement shall be transferred from the Reserve Fund to the Redemption Fund and credited to the unpaidAssessment Installments payable during such fiscal year.

Notwithstanding the above, interest earnings on moneys on deposit in the Reserve Fund in excess ofthe “yield” on the Bonds, as that term is defined in the Internal Revenue Code of 1986 (the “Code”), shall besubject to transfer and rebate to the United States Treasury.

3. Whenever moneys in the Reserve Fund, together with available funds in the RedemptionFund, are sufficient to fully and timely pay and redeem all outstanding Bonds, plus accrued interest thereon,the money shall be transferred to the Redemption Fund and collection of a corresponding amount of theremaining unpaid assessments shall cease.

4. In the event an assessment is prepaid in cash, the City shall credit the prepaid assessment with aproportionate share of the Reserve Fund and transfer an amount equal to such credit to the Redemption Fundto be utilized for the advance retirement of Bonds.

Improvement Fund: The moneys in the Improvement Fund, including the prescribed portion of proceeds ofsale of the Bonds and the proceeds of assessment prepayments received by the City prior to issuance and saleof the Bonds, shall be used only for the payment of Project Costs as that term is defined in the Indenture.“Project Costs” shall mean the costs of the conversion of certain overhead electrical and communicationfacilities to underground locations, together with appurtenances and appurtenant work in connectiontherewith (the “Improvements”) as authorized in the assessment proceedings and all incidental costs relatedthereto, including the costs of issuing the Bonds, all as more particularly described in the AssessmentEngineer’s Report.

Interest earned on the investment of the moneys held in the Improvement Fund shall be deemed at alltimes to be part of the Improvement Fund.

Upon completion of the acquisition and construction of the Improvements, the Superintendent ofStreets of the City will file a certificate of completion (the “Certificate of Completion”) with the Treasurer.Any funds remaining in the Improvement Fund following receipt by the Treasurer of the Certificate ofCompletion shall constitute surplus (“Surplus”), and in accordance with the provisions of the Resolution ofIntention (as defined in the Indenture), the Surplus shall be utilized or distributed in such manner as shall bedetermined by the City Council for any one or more purposes set forth in said Resolution of Intention.

Rebate Fund: The City shall establish and maintain a Rebate Fund (as defined in the Indenture). Deposits shallbe made to the Rebate Fund only as may be required by and in accordance with the provisions of the Tax

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Certificate (as defined in the Indenture) pertaining to the Bonds. Amounts, if any, on deposit in the Rebate Fundshall be paid to the United States of America.

INVESTMENTS. Obligations purchased as investments of moneys in any of the funds in which investments areauthorized shall be deemed at all times to be part of such funds. Subject to the restrictions set forth in theIndenture, moneys in the Redemption Fund may from time to time be invested by the Paying Agent, at thewritten direction of the Treasurer of the City, which written direction shall contain a certification to the PayingAgent that such investments are Authorized Investments. In the absence of written direction from the City, thePaying Agent shall invest the moneys deposited in the Redemption Fund and any account of such fund ininvestments described in paragraph (vi) below. Such moneys shall be invested only in obligations which willby their terms mature on such dates so as to ensure the payment of principal of and interest on the Bonds asthe same become due; provided, investments of money in the Reserve Fund shall mature not later than fiveyears from the date of purchase except such money may be invested in a repurchase agreement or an investmentagreement without such five-year limitation so long as the repurchase agreement or investment agreementprovides for withdrawals at par on or before any Interest Payment Date.

The City and, if applicable, the Paying Agent shall sell at the best price reasonably obtainable orpresent for redemption any obligations so purchased whenever it may be necessary to do so in order to providemoneys to meet any payment or transfer for such funds or from such funds. For the purpose of determining atany given time the balance in any such funds, any such investments constituting a part of such funds shall bevalued at their market value. Notwithstanding anything in the Indenture to the contrary, the Paying Agent shallnot be responsible for any loss from any investments pursuant such Indenture, except for its own negligenceor willful misconduct. The Paying Agent may act as principal or agent in the acquisition or disposition ofinvestments. The Paying Agent and the City may commingle the funds established under such Indenture forinvestment purposes but shall nonetheless account for each separately.

The Paying Agent is authorized, in making or disposing of any investment permitted by thisSection, to deal with itself (in its individual capacity) or with any one or more of its affiliates, whether it orsuch affiliate is acting as an agent of the Paying Agent or for any third person or dealing as principal for its ownaccount.

The City acknowledges that to the extent regulations of the Comptroller of the Currency or otherapplicable regulatory entity grant the City the right to receive brokerage confirmations of security transactions asthey occur, the City specifically waived receipt of such confirmations to the extent permitted by law.Notwithstanding the preceding sentence, the Paying Agent will deliver confirmations to the City upon thewritten request of the City with respect to any specific transaction identified in the request. The Paying Agentwill furnish the City periodic cash transaction statements that include details for all investment transactionsmade by the Paying Agent.

“Authorized Investments” is defined to mean the following types of investments:

(i) (a) direct general obligations of the United States of America (including obligationsissued or held in book-entry form on the books of the Department of the Treasury of theUnited States of America) or (b) obligations of any agency, department or instrumentality ofthe United States of America the timely payment of principal of and interest on which areunconditionally guaranteed by the full faith and credit of the United States of America;

(ii) interest-bearing demand or time deposits (including certificates of deposit) in federal or Stateof California chartered savings and loan associations or banks (including the Paying Agentand its affiliates), provided that (a) in the case of a savings and loan association, such demandor time deposits shall be fully insured by the Federal Deposit Insurance Corporation, or theunsecured obligations of such savings and loan association shall be rated in one of the two

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highest rating categories by a nationally recognized rating service, and (b) in the case of abank, such demand or time deposits shall be fully insured by the Federal Deposit InsuranceCorporation, or the unsecured obligations of such bank (or the unsecured obligations ofthe parent bank holding company of which such bank is the lead bank) shall be rated in oneof the two highest rating categories by a nationally recognized rating service;

(iii) repurchase agreements collateralized by obligations described in (i) above with a registeredbroker/dealer subject to Securities Investors Protection Corporation liquidation in the eventof insolvency, or any commercial bank provided that: (a) the unsecured obligations of suchbank shall be rated in one of the two highest rating categories by a nationally recognizedrating service, or such bank shall be the lead bank of a bank holding company whoseunsecured obligations are rated in one of the two highest rating categories by a nationallyrecognized rating service; (b) the most recently reported combined capital, surplus andundivided profits of such bank shall be not less than $100,000,000; and (c) the entity holdingsuch repurchase agreement shall have a perfected first security interest in the collateralsecurities for the benefit of the City under the California Commercial Code or pursuant tothe book-entry procedures prescribed at 31 C.F.R. 306.1 et seq. or 31 C.F.R. 350.0 et seq.;

(iv) bankers acceptances endorsed and guaranteed by banks described in clause (iii) above;

(v) obligations, the interest on which is exempt from federal income taxation under Section 103of the Code and which are rated in one of the two highest rating categories by a nationallyrecognized rating service;

(vi) money market funds registered under the Federal Investment Company Act of 1940,whose shares are registered under the Federal Securities Act of 1933, and having arating by Standard & Poor’s of “AAAm-G,” “AAA-m” or “AA-m” and, if rated byMoody’s, rated “Aaa,” “Aa1” or “Aa2;”

(vii) units of a taxable government money market portfolio (including portfolios of the PayingAgent and its affiliates) comprised solely of obligations listed in clauses (i) or clause (ii)above;

(viii) commercial paper of “prime” quality of the highest ranking or of the highest letter andnumerical rating by Moody’s or Standard & Poor’s of issuing corporations that areorganized and operating within the United States of America and have total assets inexcess of $500,000,000 and have an “Aa,” “AA” or higher rating for the issuer’sdebentures, other than commercial paper, as provided by Moody’s or Standard & Poor’s,respectively, and provided that purchases of eligible commercial paper may not exceed onehundred eighty (180) days’ maturity nor represent more than ten percent (10%) of theoutstanding paper of an issuing corporation;

(ix) any general obligation of a bank or insurance company whose long-term debt obligationsare rated in one of the two highest rating categories of a nationally recognized rating service;

(x) the Local Agency Investment Fund in the State Treasury of the State of California aspermitted by the State Treasurer pursuant to Section 16429.1 of the CaliforniaGovernment Code; and

(xi) any other investment which, in the City’s sole discretion, is consistent with or of likesecurity to authorized investments specifically itemized herein and at the time ofinvestment is a legal investment under the laws of the State of California for the moneys

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proposed to be invested therein. The Paying Agent shall be entitled to rely upon anywritten investment direction from the City as a certification to the Paying Agent that suchinvestment constitutes an Authorized Investment.

PROVISIONS OF INDENTURE CONSTITUTE A CONTRACT. The provisions of the Indenture andthe Bonds shall constitute a contract between the City and the Bond owners and the provisions thereof shall beenforceable by any Bond owner for the equal benefit and protection of all Bond owners similarity situated bymandamus, accounting, mandatory injunction or any other suit, action or proceeding at law or in equity that isnow or may hereafter be authorized under the laws of the State of California in any court of competentjurisdiction. Such contract is made under and is to be construed in accordance with the laws of the State ofCalifornia.

After the issuance and delivery of the Bonds, the Indenture shall not be subject to rescission, but shallbe subject to modification to the extent and in the manner provided in the Indenture but to no greater extentand in no other manner.

MODIFICATION OR AMENDMENT TO THE INDENTURE.

A. The Indenture and the rights and obligations of the City, of the owners of the Bonds and of thePaying Agent may be modified or amended at any time by a supplemental indenture pursuant to theaffirmative vote at a meeting of the owners, or with the written consent without a meeting, of theowners of at least a majority in aggregate principal amount of the Bonds then outstanding. No suchmodification or amendment shall (i) extend the maturity of any Bond or the time for paying interestthereon, or otherwise alter or impair the obligation of the City to pay the principal of, and theinterest and any premium on, any Bond, without the express consent of the owner of such Bond,(ii) permit the creation of any pledge of or lien upon the assessments superior to or on a parity withthe pledge and lien created for the benefit of the Bonds, (iii) reduce the percentage of Bonds requiredfor the amendment of the Indenture, or (iv) reduce the principal amount of or redemption premium onany Bond or reduce the interest rate thereon. Notwithstanding the above, any such amendment maynot modify any of the rights or obligations of the Paying Agent without its written consent. ThePaying Agent may obtain an opinion of counsel that any such supplemental indenture entered intoby the City and the Paying Agent complies with the provisions of the Indenture and the PayingAgent may conclusively rely on such opinion.

B. The Indenture and the rights and obligations of the City and the owners may also be modified oramended at any time by a supplemental indenture, without the consent of any owners, only to the extentpermitted by law and only for any one or more of the following purposes:

(1) to add to the covenants and agreements of the City contained in the Indenture, other covenantsand agreements thereafter to be observed, or to limit or surrender any right or power thereinreserved to or conferred upon the City;

(2) to make such provisions for the purpose of curing any ambiguity, or of curing, correcting orsupplementing any defective provisions of the Indenture, or in regard to questions arising underthe Indenture, as the City and the Paying Agent may deem necessary or desirable and notinconsistent with the Indenture, and which shall not materially adversely affect the rightsof the owners; or

(3) to make such additions, deletions or modifications as may be necessary or desirable to assurecompliance with Section 148 of the Code relating to required rebate of excess earnings to theUnited States of America or otherwise as may be necessary to assure exclusion from gross

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income for federal income tax purposes of interest on the Bonds or to conform with the federaltax regulations.

DEFEASANCE. If the City shall pay or cause to be paid, or there shall otherwise be paid, to the Owner of anoutstanding Bond the interest due thereon and the principal thereof at the times and in the manner stipulated inthe Indenture, other than as set forth below, all covenants, agreements and other obligations of the City to theOwner of such Bond under the Indenture shall thereupon cease, terminate and become void and discharged andsatisfied.

Any outstanding Bond shall be deemed to have been paid within the meaning expressed in the precedingparagraph if such Bond is paid in any one or more of the following ways:

(1) by paying or causing to be paid the principal of, premium, if any, and interest on such Bond,as and when the same shall become due and payable;

(2) by depositing with the Paying Agent, in trust, at or before maturity, money which, togetherwith the amounts then on deposit in the funds established pursuant to the Indenture (exclusiveof the Rebate Fund) and available for such purpose, is fully sufficient to pay the principal of,premium, if any, and interest on such Bond, as and when the same shall become due andpayable; or

(3) by depositing with an escrow bank appointed by the City, in trust, noncallable United StatesTreasury Obligations, in such amount as a certified public accountant shall determine (as setforth in a verification report from such accountant) will be sufficient, together with theinterest to accrue thereon and moneys then on deposit in the funds established under the Indenture(exclusive of the Rebate Fund) and available for such purpose, together with the interest toaccrue thereon, to pay and discharge the principal of, premium, if any, and interest on suchBond, as and when the same shall become due and payable;

then, at the election of the City, and notwithstanding that any outstanding Bonds shall not have beensurrendered for payment, all obligations of the City under the Indenture with respect to such Bond shallcease and terminate, except for the obligation of the Paying Agent to pay or cause to be paid to the Owners ofany such Bond not so surrendered and paid, all sums due thereon and except for the covenants of the City topreserve the exclusion of the interest on the Bonds from gross income for federal income tax purposes. Noticeof such election shall be filed with the Paying Agent not less than ten (10) days prior to the proposeddefeasance date, or such shorter period of time as may be acceptable to the Paying Agent. In connection with adefeasance under (2) or (3) above, there shall be provided to the Paying Agent a certificate of a certifiedpublic accountant stating its opinion as to the sufficiency of the moneys or securities deposited with the PayingAgent or the escrow bank, together with the interest to accrue thereon and moneys then on deposit in thefunds established under the Indenture (exclusive of the Rebate Fund) and available for such purpose, togetherwith the interest to accrue thereon to pay and discharge the principal of, premium, if any, and interest on all suchBonds to be defeased in accordance with the Indenture as and when the same shall become due and payable,and an opinion of Bond Counsel (which may rely upon the opinion of the certified public accountant) to theeffect that the Bonds being defeased have been legally defeased in accordance with the Indenture.

PAYING AGENT. The City appoints U.S. Bank National Association, as Paying Agent for the Bonds.The Paying Agent is authorized to and shall mail or wire transfer interest payments to the Bond owners,select Bonds for redemption, give notice of redemption of Bonds, maintain the bond register and maintainand administer the Redemption Fund. The Paying Agent is authorized to pay the principal of andpremium, if any, on the Bonds when the same are duly presented to it for payment at maturity or on calland redemption, to provide for the registration of transfer and exchange of Bonds presented to it for suchpurposes, to provide for the cancellation of Bonds and to provide for the authentication of Bonds. ThePaying Agent shall keep accurate records of all funds administered by it and all Bonds paid and

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discharged by it. The Paying Agent initially appointed, and any successor thereto, may be removed bythe City and a successor or successors may be appointed. So long as any Bonds are outstanding andunpaid, the Paying Agent and any successor or successors thereto designated by the City shall continue tobe Paying Agent of the City for all of said purposes until the designation of a successor or successors asPaying Agent.

The Paying Agent may rely and shall be protected in acting or refraining from acting upon anynotice, resolution, request, consent, order, certificate, report, warrant, bond or other paper or documentbelieved by it to be genuine and to have been signed or presented by the proper party or proper parties.The Paying Agent may consult with counsel, who may be counsel to the City, with regard to legalquestions, and the opinion of such counsel shall be full and complete authorization and protection inrespect of any action taken or suffered by it under the Indenture in good faith and in accordancetherewith.

Whenever the Paying Agent shall deem it necessary or desirable that a matter be proved orestablished prior to taking or suffering any action under the Indenture, such matter (unless other evidencein respect thereof be therein specifically prescribed) may, in the absence of negligence or willfulmisconduct on the part of the Paying Agent, be deemed to be conclusively proved and established by acertificate of the City, and such certificate shall be full warrant to the Paying Agent for any action takenor suffered under the provisions of the Indenture or any Supplemental Indenture upon the faith thereof,but in its discretion, the Paying Agent may, in lieu thereof, accept other evidence of such matter or mayrequire such additional evidence of such matter or may require such additional evidence as to it may deemreasonable.

The City shall pay to the Paying Agent from time to time reasonable compensation for allservices rendered as Paying Agent under the Indenture and also all reasonable expenses, charges, counselfees and other disbursements, including those of its attorneys, agents and employees, incurred in andabout the performance of its powers and duties under the Indenture, and the Paying Agent shall have alien therefor on any funds at any time held by it under the Indenture. The City further agrees, to theextent permitted by applicable law, to indemnify and save the Paying Agent, it officers, employees andagents harmless against any liabilities which it may incur in the exercise and performance of its powersand duties under the Indenture which are not due to its negligence or willful misconduct.

A Paying Agent appointed under the Indenture may resign at any time upon written notice to theCity and after appointment of a successor, provided the successor is either the Treasurer of the City or is abank or trust company having (or, if such bank or trust company is a member of a bank holding company,its bank holding company has) combined capital (excluding borrowed capital) and surplus of at least$50,000,000 and is subject to State or federal supervision. Any company into which the Paying Agentmay be merged or converted or with which it may be consolidated or any company resulting from anymerger, conversion or consolidation to which it shall be a party or any company to which the PayingAgent may sell or transfer all or substantially all of its corporate trust business, provided such companyshall be eligible, shall succeed to the rights and obligations of such Paying Agent without the execution orfiling of any paper or further act. If a successor to the Paying Agent is not appointed by the City withinsixty (60) calendar days after notice of resignation by the Paying Agent, the Paying Agent may petition acourt of competent jurisdiction to appoint a successor.

LIABILITY OF PAYING AGENT. The recitals of fact and all promises, covenants and agreementscontained in the Indenture and in the Bonds shall be taken as statements, promises, covenants andagreements of the City, and the Paying Agent assumes no responsibility for the correctness of the sameand makes no representations as to the validity or sufficiency of the Indenture or of the Bonds and shallincur no responsibility in respect thereof other than in connection with its duties or obligations in theIndenture, or in the Bonds or in the certificate of authorization assigned to or imposed upon the Paying

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Agent. No implied duties or obligations shall be read into the Indenture against the Paying Agent. ThePaying Agent shall be under no responsibility or duty with respect to the issuance of the Bonds for value.The Paying Agent shall not be liable in connection with the performance of its duties under the Indenture,except for its own negligence or willful misconduct. The Paying Agent shall be protected in acting onany notice, resolution, request, consent, certificate or other document believed by it to be genuine and tohave been signed or presented by the proper party.

The Paying Agent assumes no responsibility or liability for any information, statement or recitalin any offering memorandum or other disclosure material prepared or distributed with respect to theissuance of the Bonds. The Paying Agent shall not be liable for any error of judgment made in good faithby a responsible officer of the Paying Agent unless it shall be proved that the Paying Agent was negligentin ascertaining the pertinent facts. No provision of the Indenture shall require the Paying Agent to expendor risk its own funds or otherwise incur any financial liability in the performance of any of its dutiesthereunder or in the exercise of any of its rights or powers. All indemnification and releases from liabilitygranted to the Paying Agent shall extend to the officers and employees of the Paying Agent.

The Paying Agent shall not be chargeable with taking any actions under the Indenture inaccordance with the Act but shall solely be charged with taking action in accordance with the Indentureand any other written direction furnished by the City.

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APPENDIX D

FORM OF LEGAL OPINION

Upon delivery of the Bonds, Meyers, Nave, Riback, Silver & Wilson, a Professional LawCorporation, Oakland, California, Bond Counsel to the City of Newport Beach, proposes to render itsfinal approving opinion with respect to the Bonds in substantially the following form (see“CONCLUDING INFORMATION – Tax Matters”):

October __, 2009

City CouncilCity of Newport Beach3300 Newport BoulevardNewport Beach, CA 92663

City of Newport BeachAssessment District No. 103

(G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard)Limited Obligation Improvement Bonds

(Final Opinion)

Ladies and Gentlemen:

We have acted as bond counsel to the City of Newport Beach (the “Issuer”) in connectionwith the issuance by the Issuer of $3,295,700.00 aggregate principal amount of the City of NewportBeach Assessment District No. 103 (G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard)Limited Obligation Improvement Bonds (the “Bonds”) pursuant to the provisions of the MunicipalImprovement Act of 1913 and the Improvement Bond Act of 1915 and the Bond Indenture, dated as ofOctober 1, 2009 (the “Indenture”), between the Issuer and U.S. Bank National Association, as PayingAgent, approved by Resolution No. 2009-65, passed and adopted by the City Council on September 8,2009 (the “Resolution”). Capitalized terms not otherwise defined herein shall have the meanings ascribedto them in the Indenture.

In such connection, we have reviewed the Resolution, the Indenture, the Tax Certificateof the Issuer dated the date hereof (the “Tax Certificate”), an opinion of the City Attorney as general legalcounsel to the Issuer, certifications of the Issuer and others and such other documents, opinions andmatters to the extent we deemed necessary to render the opinions set forth herein.

Certain agreements, requirements and procedures contained or referred to in theResolution, the Indenture, the Tax Certificate and other relevant documents may be changed and certainactions (including, without limitation, defeasance of the Bonds) may be taken or omitted under thecircumstances and subject to the terms and conditions set forth in such documents. No opinion isexpressed herein as to any Bond or the interest thereon if any such change occurs or action is taken oromitted upon the advice or approval of counsel other than ourselves.

The opinions expressed herein are based on an analysis of existing laws, regulations,rulings and court decisions and cover certain matters not directly addressed by such authorities. Suchopinions may be affected by actions taken or omitted or events occurring after the date hereof. We havenot undertaken to determine, or to inform any person, whether any such actions are taken or omitted or

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events do occur. Our engagement with respect to the Bonds has concluded with their issuance, and wedisclaim any obligation to update this opinion. We have assumed the genuineness of all documents andsignatures presented to us (whether as originals or copies) and the due and legal execution and deliverythereof by, and validity against, any parties other than the Issuer. We have not undertaken to verifyindependently, and have assumed, the accuracy of the factual matters represented, warranted or certifiedin the documents, and of the legal conclusions contained in the opinion, referred to in the secondparagraph hereof.

Furthermore, we have assumed compliance with all covenants and agreements containedin the Resolution, the Indenture and the Tax Certificate, including (without limitation) covenants andagreements compliance with which is necessary to assure that future actions, omissions or events will notcause interest on the Bonds to be included in gross income for federal income tax purposes. In addition,we call attention to the fact that the rights and obligations under the Bonds, the Resolution, the Indentureand the Tax Certificate may be subject to bankruptcy, insolvency, reorganization, arrangement, fraudulentconveyance, moratorium and other similar laws relating to or affecting creditors’ rights, to the applicationof equitable principles, to the exercise of judicial discretion in appropriate cases and to the limitations onlegal remedies against cities in the State of California.

We express no opinion on the plans, specifications, maps and other engineering details ofthe proceedings, or upon the validity of the individual separate assessments securing the Bonds whichvalidity depends, in addition to the legal steps required, upon the accuracy of certain of the engineeringdetails. Finally, we undertake no responsibility for the accuracy, completeness or fairness of the OfficialStatement or other offering material relating to the Bonds and express no opinion with respect thereto.

Based on and subject to the foregoing, and in reliance thereon, as of the date hereof, weare of the following opinions:

1. The Bonds constitute valid and binding special assessment obligations of theIssuer, payable solely from and secured by the unpaid assessments and certain funds held under theIndenture.

2. The Resolution and the Indenture have been duly adopted and constitute validand binding obligations of the Issuer.

3. Interest on the Series Bonds is excluded from gross income for federal incometax purposes under Section 103 of the Internal Revenue Code of 1986 and is exempt from State ofCalifornia personal income taxes. Interest on the Bonds is not a specific preference item for purposes ofthe federal individual or corporate alternative minimum taxes, although we observe that it is included inadjusted current earnings in calculating corporate alternative minimum taxable income. We express noopinion regarding other tax consequences related to the ownership or disposition of, or the accrual orreceipt of interest on, the Bonds.

Faithfully yours,MEYERS, NAVE, RIBACK, SILVER & WILSON

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APPENDIX E

INFORMATION CONCERNING THE DEPOSITORY TRUST COMPANY

The information in this section concerning DTC and DTC’s book-entry-only system has been obtainedfrom sources that the District believes to be reliable, but the District takes no responsibility for thecompleteness or accuracy thereof. The following description of the procedures and record keeping withrespect to beneficial ownership interests in the Bonds, payment of principal, premium, if any, accreted valueand interest on the Bonds to DTC Participants or Beneficial Owners, confirmation and transfers of beneficialownership interests in the Bonds and other related transactions by and between DTC, the DTC Participantsand the Beneficial Owners is based solely on information provided by DTC.

The Depository Trust Company (“DTC”), New York, NY, will act as securities depository for theBonds (the “Bonds”). The Bonds will be issued as fully-registered securities registered in the name ofCede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorizedrepresentative of DTC. One fully-registered Bond certificate will be issued for each maturity of theBonds, in the aggregate principal amount of such maturity, and will be deposited with DTC.

DTC, the world’s largest securities depository, is a limited-purpose trust company organized underthe New York Banking Law, a “banking organization” within the meaning of the New York BankingLaw, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New YorkUniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17Aof the Securities Exchange Act of 1934. DTC holds and provides asset servicing for over 3.5 millionissues of U.S. and non-U.S. equity issues, corporate and municipal debt issues, and money market instruments(from over 100 countries) that DTC’s participants (“Direct Participants”) deposit with DTC. DTC alsofacilitates the post-trade settlement among Direct Participants of sales and other securities transactions indeposited securities, through electronic computerized book-entry transfers and pledges between DirectParticipants’ accounts. This eliminates the need for physical movement of securities certificates. DirectParticipants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearingcorporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust& Clearing Corporation (“DTCC”). DTCC is the holding company for DTC, National Securities ClearingCorporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies.DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available toothers such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, and clearingcorporations that clear through or maintain a custodial relationship with a Direct Participant, eitherdirectly or indirectly (“Indirect Participants”). DTC has Standard & Poor’s highest rating: AAA. TheDTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. Moreinformation about DTC can be found at www.dtcc.com and www.dtc.org.

Purchases of Bonds under the DTC system must be made by or through Direct Participants, whichwill receive a credit for the Bonds on DTC’s records. The ownership interest of each actual purchaser ofeach Bond (“Beneficial Owner”) is in turn to be recorded on the Direct and Indirect Participants’ records.Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are,however, expected to receive written confirmations providing details of the transaction, as well as periodicstatements of their holdings, from the Direct or Indirect Participant through which the Beneficial Ownerentered into the transaction. Transfers of ownership interests in the Bonds are to be accomplished byentries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners.Beneficial Owners will not receive certificates representing their ownership interests in Bonds, except in theevent that use of the book-entry system for the Bonds is discontinued.

To facilitate subsequent transfers, all Bonds deposited by Direct Participants with DTC areregistered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be

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requested by an authorized representative of DTC. The deposit of Bonds with DTC and theirregistration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficialownership. DTC has no knowledge of the actual Beneficial Owners of the Bonds; DTC’s records reflect onlythe identity of the Direct Participants to whose accounts such Bonds are credited, which may or may not be theBeneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of theirholdings on behalf of their customers.

Conveyance of notices and other communications by DTC to Direct Participants, by DirectParticipants to Indirect Participants, and by Direct Participants and Indirect Participants to BeneficialOwners will be governed by arrangements among them, subject to any statutory or regulatory requirementsas may be in effect from time to time. Beneficial Owners of Bonds may wish to take certain steps toaugment the transmission to them of notices of significant events with respect to the Bonds, such asredemptions, tenders, defaults, and proposed amendments to the Bond documents. For example, BeneficialOwners of Bonds may wish to ascertain that the nominee holding the Bonds for their benefit has agreed toobtain and transmit notices to Beneficial Owners. In the alternative, Beneficial Owners may wish to providetheir names and addresses to the registrar and request that copies of notices be provided directly to them.

Redemption notices shall be sent to DTC. If less than all of the Bonds within a maturity are beingredeemed, DTC’s practice is to determine by lot the amount of the interest of each Direct Participant in suchmaturity to be redeemed.

Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect toBonds unless authorized by a Direct Participant in accordance with DTC’s MMI Procedures. Under itsusual procedures, DTC mails an Omnibus Proxy to the District as soon as possible after the record date.The Omnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whoseaccounts Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).

Principal, redemption price and interest payments on the Bonds will be made to Cede & Co., orsuch other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to creditDirect Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from theDistrict or the Paying Agent, on payable date in accordance with their respective holdings shown on DTC’srecords. Payments by Participants to Beneficial Owners will be governed by standing instructions andcustomary practices, as is the case with securities held for the accounts of customers in bearer form orregistered in “street name,” and will be the responsibility of such Participant and not of DTC, the PayingAgent, or the District, subject to any statutory or regulatory requirements as may be in effect from time totime. Payment of principal, redemption price and interest payments to Cede & Co. (or such other nominee asmay be requested by an authorized representative of DTC) is the responsibility of the District or the PayingAgent, disbursement of such payments to Direct Participants will be the responsibility of DTC, anddisbursement of such payments to the Beneficial Owners will be the responsibility of Direct and IndirectParticipants.

DTC may discontinue providing its services as depository with respect to the Bonds at any time bygiving reasonable notice to the District or the Paying Agent. Under such circumstances, in the event that asuccessor depository is not obtained, Bond certificates are required to be printed and delivered.

The District may decide to discontinue use of the system of book-entry-only transfers throughDTC (or a successor securities depository). In that event, Bond certificates will be printed and deliveredto DTC.

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APPENDIX F

DISCLOSURE DISSEMINATION AGENT AGREEMENT

This Disclosure Dissemination Agent Agreement (the “Disclosure Agreement”), dated as ofOctober 1, 2009, is executed and delivered by the City of Newport Beach (the “Issuer”) and DigitalAssurance Certification, L.L.C., as exclusive Disclosure Dissemination Agent (the “Disclosure DisseminationAgent” or “DAC”) for the benefit of the Holders (hereinafter defined) of the Bonds (hereinafter defined) and inorder to provide certain continuing disclosure with respect to the Bonds in accordance with Rule 15c2-12 ofthe United States Securities and Exchange Commission under the Securities Exchange Act of 1934, as thesame may be amended from time to time (the “Rule”).

SECTION 1. Definitions. Capitalized terms not otherwise defined in this DisclosureAgreement shall have the meaning assigned in the Rule or, to the extent not in conflict with the Rule, inthe Official Statement (hereinafter defined). The capitalized terms shall have the following meanings:

“Annual Filing Date” means the date, set in Sections 2(a) and 2(f), by which the Annual Report isto be filed with the MSRB.

“Annual Financial Information” means annual financial information as such term is used inparagraph (b)(5)(i) of the Rule and specified in Section 3(a) of this Disclosure Agreement.

“Annual Report” means an Annual Report described in and consistent with Section 3 ofthis Disclosure Agreement.

“Audited Financial Statements” means the financial statements (if any) of the Issuer for the prior fiscalyear, certified by an independent auditor as prepared in accordance with generally accepted accountingprinciples or otherwise, as such term is used in paragraph (b)(5)(i) of the Rule and specified in Section 3(b)of this Disclosure Agreement.

“Bonds” means the bonds as listed on the attached Exhibit A, with the 9-digit CUSIP® numbersrelating thereto.

“Certification” means a written certification of compliance signed by the Disclosure Representativestating that the Annual Report, Audited Financial Statements, Voluntary Report or Notice Event noticedelivered to the Disclosure Dissemination Agent is the Annual Report, Audited Financial Statements,Voluntary Report or Notice Event notice required to be submitted to the MSRB under this DisclosureAgreement. A Certification shall accompany each such document submitted to the DisclosureDissemination Agent by the Issuer and include the full name of the Bonds and the 9-digit CUSIP® numbersfor all Bonds to which the document applies.

“Disclosure Dissemination Agent” means Digital Assurance Certification, L.L.C., acting in itscapacity as Disclosure Dissemination Agent hereunder, or any successor Disclosure Dissemination Agentdesignated in writing by the Issuer pursuant to Section 9 hereof.

“Disclosure Representative” means the Finance Officer of the Issuer, or such other person as theIssuer shall designate in writing to the Disclosure Dissemination Agent from time to time as the personresponsible for providing Information to the Disclosure Dissemination Agent.

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“EMMA System” means the Electronic Municipal Market Access system of the MSRB or suchother electronic system designated by the MSRB or the SEC for compliance with SEC Rule 15c2-12(b).

“Holder” means any person (a) having the power, directly or indirectly, to vote or consent withrespect to, or to dispose of ownership of, any Bonds (including persons holding Bonds through nominees,depositories or other intermediaries) or (b) treated as the owner of any Bonds for federal income taxpurposes.

“Information” means the Annual Financial Information, the Audited Financial Statements (if any), theNotice Event notices and the Voluntary Reports.

“MSRB” means the Municipal Securities Rulemaking Board established pursuant to Section15B(b)(1) of the Securities Exchange Act of 1934.

“Notice Event” means an event listed in Section 4(a) of this Disclosure Agreement.

“Official Statement” means that Official Statement prepared by the Issuer in connection with theBonds, as listed on Exhibit A.

“Paying Agent” means the institution identified as such in the document under which the Bondswere issued.

“SEC” means Securities and Exchange Commission.

“Underwriter” shall mean any underwriter of the Bonds required to comply with the Rule inconnection with the offering of the Bonds.

“Voluntary Report” means the information provided to the Disclosure Dissemination Agent bythe Issuer pursuant to Section 7.

SECTION 2. Provision of Annual Reports.

(a) The Issuer shall provide, annually, an electronic copy of the Annual Report and Certificationto the Disclosure Dissemination Agent, together with a copy for the Paying Agent and the Underwriter, notlater than 30 days prior to the Annual Filing Date. Upon receipt of an electronic copy of the Annual Reportand the Certification, the Disclosure Dissemination Agent shall provide an Annual Report to the MSRBthrough the EMMA System in an electronic format and accompanied by identifying information asprescribed by the MSRB, not later March 31 after the end of each fiscal year of the Issuer, commencingwith the fiscal year ending June 30, 2009; provided, however, that the first Annual Report due onMarch 31, 2010, shall consist solely of a copy of the Official Statement together with a copy of theaudited Financial Statements of the Issuer. Such date and each anniversary thereof is the Annual FilingDate. The Annual Report may be submitted as a single document or as separate documents comprising apackage and may cross reference other information as provided in Section 3 of this Disclosure Agreement.

(b) If on the fifteenth (15th) day prior to the Annual Filing Date, the Disclosure DisseminationAgent has not received a copy of the Annual Report and Certification, the Disclosure Dissemination Agentshall contact the Disclosure Representative by telephone and in writing (which may be by e-mail) toremind the Issuer of its undertaking to provide the Annual Report pursuant to Section 2(a). Promptly uponsuch reminder, the Disclosure Representative shall either (i) provide the Disclosure Dissemination Agent withan electronic copy of the Annual Report and the Certification (no later than two (2) business days prior to theAnnual Filing Date), or (ii) instruct the Disclosure Dissemination Agent in writing that the Issuer will not be

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able to file the Annual Report within the time required under this Disclosure Agreement, state the date bywhich the Annual Report for such year will be provided and instruct the Disclosure Dissemination Agentthat a Notice Event as described in Section 4(a)(12) has occurred and to immediately send a notice to theMSRB through the EMMA System in substantially the form attached as Exhibit B.

(c) If the Disclosure Dissemination Agent has not received an Annual Report andCertification by 12:00 noon on the first business day following the Annual Filing Date for the AnnualReport, a Notice Event described in Section 4(a)(12) shall have occurred and the Issuer irrevocably directs theDisclosure Dissemination Agent to immediately send a notice to the MSRB through the EMMA System insubstantially the form attached as Exhibit B.

(d) If Audited Financial Statements of the Issuer are prepared but not available prior to theAnnual Filing Date, the Issuer shall, when the Audited Financial Statements are available, provide in a timelymanner an electronic copy to the Disclosure Dissemination Agent, accompanied by a Certificate, togetherwith a copy for the Paying Agent for filing with the MSRB through the EMMA System.

(e) The Disclosure Dissemination Agent shall:

(i) determine the electronic filing requirements of the MSRB each year prior to theAnnual Filing Date;

(ii) upon receipt, promptly file each Annual Report received under Section 2(a) withthe MSRB through the EMMA System;

(iii) upon receipt, promptly file each Audited Financial Statement received underSection 2(d) with the MSRB through the EMMA System;

(iv) upon receipt, promptly file the text of each disclosure to be made with the MSRBthrough the EMMA System, together with information regarding the event as required by theMSRB as described below when filing pursuant to the Section of this Disclosure Agreementindicated:

1. “Principal and interest payment delinquencies,” pursuant to Sections 4(c)and 4(a)(1);

2. “Non-payment related defaults,” pursuant to Sections 4(c) and 4(a)(2);

3. “Unscheduled draws on debt service reserves reflecting financialdifficulties,” pursuant to Sections 4(c) and 4(a)(3);

4. “Unscheduled draws on credit enhancements reflecting financialdifficulties,” pursuant to Sections 4(c) and 4(a)(4);

5. “Substitution of credit or liquidity providers, or their failure toperform,” pursuant to Sections 4(c) and 4(a)(5);

6. “Adverse tax opinions or events affecting the tax-exempt status of thesecurity,” pursuant to Sections 4(c) and 4(a)(6);

7. “Modifications to rights of security holders,” pursuant to Sections 4(c) and4(a)(7);

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8. “Bond calls,” pursuant to Sections 4(c) and 4(a)(8);

9. “Defeasances,” pursuant to Sections 4(c) and 4(a)(9);

10. “Release, substitution or sale of property securing repayment of thesecurities,” pursuant to Sections 4(c) and 4(a)(10);

11. “Ratings changes,” pursuant to Sections 4(c) and 4(a)(11); or

12. “Other material event notice (specify),” pursuant to Section 7 of thisAgreement, together with the summary description provided by theDisclosure Representative (e.g., “Failure to provide annual financialinformation as required,” pursuant to Section 2(b)(ii) or Section 2(c),together with a completed copy of Exhibit B to this DisclosureAgreement);

(v) provide the Issuer evidence of the filings of each of the above when made,which shall be by means of the DAC system, for so long as DAC is the Disclosure DisseminationAgent under this Disclosure Agreement.

(f) The Issuer may adjust the Annual Filing Date upon change of its fiscal year byproviding written notice of such change and the new Annual Filing Date to the Disclosure DisseminationAgent, Paying Agent (if any) and the MSRB through the EMMA System, provided that the period between theexisting Annual Filing Date and new Annual Filing Date shall not exceed one year.

Notwithstanding any other provisions of this Disclosure Agreement, any of the required filingshereunder may be made with the MSRB through the Electronic Municipal Market Access (EMMA),approved by the Securities and Exchange Commission.

SECTION 3. Content of Annual Reports.

(a) Each Annual Report shall contain Annual Financial Information with respect to the Issuer,including (1) the audited financial statements of the City; (2) the principal amount of Bonds outstanding;(3) the status of the public improvements which have been financed by the City with proceeds of theBonds; (4) a table setting forth the percentage of delinquent Assessment Installments as of June 30 of eachfiscal year and a description of the status of any foreclosure actions being pursued by the City with respect todelinquent Assessment Installments; (5) the Reserve Fund balance; (6) an update of the table entitled “Top TenProperty Owners” in the Official Statement and (7) the total assessed value of property within the District.

(b) Audited Financial Statements prepared in accordance with generally accepted accountingprinciples (“GAAP”) will be included in the Annual Report. If audited financial statements are notavailable, then unaudited financial statements, prepared in accordance with GAAP, will be included in theAnnual Report. Audited Financial Statements (if any) will be provided pursuant to Section 2(d).

Any or all of the items listed above may be included by specific reference from other documents,including official statements of debt issues with respect to which the Issuer is an “obligated person” (as definedby the Rule), which have been previously filed with the MSRB through the EMMA System or the Securitiesand Exchange Commission. If the document incorporated by reference is a final official statement, itmust be available from the MSRB. The Issuer will clearly identify each such document so incorporated byreference.

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Any annual financial information containing modified operating data or financial information isrequired to explain, in narrative form, the reasons for the modification and the impact of the change in the typeof operating data or financial information being provided.

SECTION 4. Reporting of Notice Events.

(a) The occurrence of any of the following events, if material, with respect to the Bondsconstitutes a Notice Event:

1. Principal and interest payment delinquencies;

2. Non-payment related defaults;

3. Unscheduled draws on debt service reserves reflecting financial difficulties;

4. Unscheduled draws on credit enhancements reflecting financial difficulties;

5. Substitution of credit or liquidity providers, or their failure to perform;

6. Adverse tax opinions or events affecting the tax-exempt status of the security;

7. Modifications to rights of security holders;

8. Bond calls;

9. Defeasances;

10. Release, substitution or sale of property securing repayment of the securities;

11. Rating changes; or

12. Other material event notice (e.g., failure to provide annual financial informationas required).

The Issuer shall promptly notify the Disclosure Dissemination Agent in writing upon the occurrenceof a Notice Event. Such notice shall instruct the Disclosure Dissemination Agent to report the occurrencepursuant to subsection (c). Such notice shall be accompanied with the text of the disclosure that the Issuerdesires to make, the written authorization of the Issuer for the Disclosure Dissemination Agent todisseminate such information and the date the Issuer desires for the Disclosure Dissemination Agent todisseminate the information.

(b) The Disclosure Dissemination Agent is under no obligation to notify the Issuer or theDisclosure Representative of an event that may constitute a Notice Event. In the event the DisclosureDissemination Agent so notifies the Disclosure Representative, the Disclosure Representative will, within fivebusiness days of receipt of such notice, instruct the Disclosure Dissemination Agent that (i) a Notice Event hasnot occurred and no filing is to be made or (ii) a Notice Event has occurred and the DisclosureDissemination Agent is to report the occurrence pursuant to subsection (c), together with the text of thedisclosure that the Issuer desires to make, the written authorization of the Issuer for the Disclosure

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Dissemination Agent to disseminate such information and the date the Issuer desires for the DisclosureDissemination Agent to disseminate the information.

(c) If the Disclosure Dissemination Agent has been instructed by the Issuer as prescribed insubsection (a) or (b)(ii) of this Section 4 to report the occurrence of a Notice Event, the DisclosureDissemination Agent shall promptly file a notice of such occurrence with the MSRB through the EMMASystem in accordance with Section 2 (e)(iv) hereof.

SECTION 5. CUSIP® Numbers. Whenever providing information to the Disclosure DisseminationAgent, including but not limited to Annual Reports, documents incorporated by reference to the AnnualReports, Audited Financial Statements, notices of Notice Events and Voluntary Reports filed pursuant toSection 7(a), the Issuer shall indicate the full name of the Bonds and the 9-digit CUSIP® numbers for theBonds as to which the provided information relates.

SECTION 6. Additional Disclosure Obligations. The Issuer acknowledges and understandsthat other state and federal laws, including but not limited to the Securities Act of 1933 and Rule 10b-5promulgated under the Securities Exchange Act of 1934, may apply to the Issuer, and that the failure of theDisclosure Dissemination Agent to so advise the Issuer shall not constitute a breach by the DisclosureDissemination Agent of any of its duties and responsibilities under this Disclosure Agreement. The Issueracknowledges and understands that the duties of the Disclosure Dissemination Agent relate exclusively toexecution of the mechanical tasks of disseminating information as described in this Disclosure Agreement.

SECTION 7. Voluntary Reports.

(a) The Issuer may instruct the Disclosure Dissemination Agent to file information with theMSRB through the EMMA System from time to time pursuant to a Certification of the DisclosureRepresentative accompanying such information (a “Voluntary Report”).

(b) Nothing in this Disclosure Agreement shall be deemed to prevent the Issuer fromdisseminating any other information through the Disclosure Dissemination Agent using the means ofdissemination set forth in this Disclosure Agreement or including any other information in any Annual Report,Annual Financial Statement, Voluntary Report or Notice Event notice, in addition to that required by thisDisclosure Agreement. If the Issuer chooses to include any information in any Annual Report, AnnualFinancial Statement, Voluntary Report or Notice Event notice in addition to that which is specificallyrequired by this Disclosure Agreement, the Issuer shall have no obligation under this Disclosure Agreement toupdate such information or include it in any future Annual Report, Annual Financial Statement, VoluntaryReport or Notice Event notice.

SECTION 8. Termination of Reporting Obligation. The obligations of the Issuer and theDisclosure Dissemination Agent under this Disclosure Agreement shall terminate with respect to the Bondsupon the legal defeasance, prior redemption or payment in full of all of the Bonds when the Issuer is nolonger an obligated person with respect to the Bonds, or upon delivery by the Disclosure Representative tothe Disclosure Dissemination Agent of an opinion of nationally recognized bond counsel to the effect thatcontinuing disclosure is no longer required.

SECTION 9. Disclosure Dissemination Agent. The Issuer has appointed Digital AssuranceCertification, L.L.C. as exclusive Disclosure Dissemination Agent under this Disclosure Agreement. TheIssuer may, upon thirty days written notice to the Disclosure Dissemination Agent and the Paying Agent,replace or appoint a successor Disclosure Dissemination Agent. Upon termination of DAC’s services asDisclosure Dissemination Agent, whether by notice of the Issuer or DAC, the Issuer agrees to appoint asuccessor Disclosure Dissemination Agent or, alternately, agrees to assume all responsibilities of DisclosureDissemination Agent under this Disclosure Agreement for the benefit of the Holders of the Bonds.

F-7

Notwithstanding any replacement or appointment of a successor, the Issuer shall remain liable until payment infull for any and all sums owed and payable to the Disclosure Dissemination Agent. The DisclosureDissemination Agent may resign at any time by providing thirty days’ prior written notice to the Issuer.

SECTION 10. Remedies in Event of Default. In the event of a failure of the Issuer or the DisclosureDissemination Agent to comply with any provision of this Disclosure Agreement, the Holders’ rights toenforce the provisions of this Agreement shall be limited solely to a right, by action in mandamus or forspecific performance, to compel performance of the party’s obligation under this Disclosure Agreement. Anyfailure by a party to perform in accordance with this Disclosure Agreement shall not constitute a default on theBonds or under any other document relating to the Bonds, and all rights and remedies shall be limited to thoseexpressly stated herein.

SECTION 11. Duties, Immunities and Liabilities of Disclosure Dissemination Agent.

(a) The Disclosure Dissemination Agent shall have only such duties as are specifically setforth in this Disclosure Agreement. The Disclosure Dissemination Agent’s obligation to deliver theinformation at the times and with the contents described herein shall be limited to the extent the Issuer hasprovided such information to the Disclosure Dissemination Agent as required by this Disclosure Agreement.The Disclosure Dissemination Agent shall have no duty with respect to the content of any disclosure or noticemade pursuant to the terms hereof. The Disclosure Dissemination Agent shall have no duty or obligation toreview or verify any Information or any other information, disclosures or notices provided to it by the Issuerand shall not be deemed to be acting in any fiduciary capacity for the Issuer, the Holders of the Bonds or anyother party. The Disclosure Dissemination Agent shall have no responsibility for the Issuer’s failure to reportto the Disclosure Dissemination Agent a Notice Event or a duty to determine the materiality thereof. TheDisclosure Dissemination Agent shall have no duty to determine, or liability for failing to determine,whether the Issuer has complied with this Disclosure Agreement. The Disclosure Dissemination Agentmay conclusively rely upon certifications of the Issuer at all times.

The obligations of the Issuer under this Section shall survive resignation or removal of theDisclosure Dissemination Agent and defeasance, redemption or payment of the Bonds.

(b) The Disclosure Dissemination Agent may, from time to time, consult with legalcounsel (either in-house or external) of its own choosing in the event of any disagreement or controversy orquestion or doubt as to the construction of any of the provisions hereof or its respective duties hereunder andshall not incur any liability and shall be fully protected in acting in good faith upon the advice of suchlegal counsel. The reasonable fees and expenses of such counsel shall be payable by the Issuer.

(c) All documents, reports, notices, statements, information and other materials provided tothe MSRB under this Disclosure Agreement shall be provided in an electronic format and accompaniedby identifying information prescribed by the MSRB.

SECTION 12. Amendment; Waiver. Notwithstanding any other provision of this DisclosureAgreement, the Issuer and the Disclosure Dissemination Agent may amend this Disclosure Agreement and anyprovision of this Disclosure Agreement may be waived, if such amendment or waiver is supported by anopinion of counsel expert in federal securities laws acceptable to both the Issuer and the DisclosureDissemination Agent to the effect that such amendment or waiver does not materially impair the interests ofHolders of the Bonds and would not, in and of itself, cause the undertakings herein to violate the Rule if suchamendment or waiver had been effective on the date hereof but taking into account any subsequent changein or official interpretation of the Rule; provided neither the Issuer nor the Disclosure Dissemination Agentshall be obligated to agree to any amendment modifying their respective duties or obligations without theirconsent thereto.

F-8

Notwithstanding the preceding paragraph, the Disclosure Dissemination Agent shall have theright to adopt amendments to this Disclosure Agreement necessary to comply with modifications to andinterpretations of the provisions of the Rule as announced by the Securities and Exchange Commission fromtime to time by giving not less than 20 days’ written notice of the intent to do so together with a copy ofthe proposed amendment to the Issuer. No such amendment shall become effective if the Issuer shall,within 10 days following the giving of such notice, send a notice to the Disclosure Dissemination Agent inwriting that it objects to such amendment.

SECTION 13. Beneficiaries. This Disclosure Agreement shall inure solely to the benefitof the Issuer, the Paying Agent of the Bonds, the Disclosure Dissemination Agent, the underwriter, and theHolders from time to time of the Bonds, and shall create no rights in any other person or entity.

SECTION 14. Governing Law. This Disclosure Agreement shall be governed by the lawsof the State of California (other than with respect to conflicts of laws).

SECTION 15. Counterparts. This Disclosure Agreement may be executed in severalcounterparts, each of which shall be an original and all of which shall constitute but one and the sameinstrument.

F-9

The Disclosure Dissemination Agent and the Issuer have caused this Disclosure Agreement to beexecuted, on the date first written above, by their respective officers duly authorized.

DIGITAL ASSURANCE CERTIFICATION, L.L.C.,as Disclosure Dissemination Agent

By: _________________________________________Name:Title:

By: _________________________________________Name:Title:

CITY OF NEWPORT BEACH,as Issuer

By: _________________________________________City Manager

ATTEST:

By: ____________________________________Leilani Brown, City Clerk

APPROVED AS TO FORM:

By: ____________________________________Name:Title:

EXHIBIT A

F-10

NAME AND CUSIP® NUMBERS OF BONDS

Name of Issuer: City of Newport Beach

Name of Bond Issue: $3,295,700 City of Newport BeachAssessment District No. 103(G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard)Limited Obligation Improvement Bonds

Date of Issuance: October __, 2009

Date of Official Statement: October 2, 2009

Maturity(September 2) CUSIP® No.

2010 651784PK02011 651784PL82012 651784PM62013 651784PN42014 651784PP92015 651784PQ72016 651784PR52017 651784PS32018 651784PT12019 651784PU82020 651784PV62021 651784PW42022 651784PX22023 651784PY02024 651784PZ7

F-11

EXHIBIT B

NOTICE TO MSRB OF FAILURE TO FILE ANNUAL REPORT

Issuer: City of Newport Beach

Name of Bond Issue: $3,295,700 City of Newport BeachAssessment District No. 103(G Street/East Balboa Boulevard/Channel Road/Ocean Boulevard)Limited Obligation Improvement Bonds

Date of Issuance: October 14, 2009

NOTICE IS HEREBY GIVEN that the Issuer has not provided an Annual Report with respect tothe above named Bonds as required by the Disclosure Agreement, dated as of October 1, 2009, between theIssuer and Digital Assurance Certification, L.L.C., as Disclosure Dissemination Agent. The Issuer hasnotified the Disclosure Dissemination Agent that it anticipates that the Annual Report will be filed by__________.

Dated:

Digital Assurance Certification, L.L.C., as DisclosureDissemination Agent, on behalf of the Issuer

_____________________________________________

cc: Issuer

APPENDIX G

FINAL ENGINEER’S REPORT

Final Engineer's Report

for

Underground Utility Assessment District No. 103

(G St I E Balboa Blvd I Channel Rd I Ocean Blvd)

Prepared under the provisions of the Municipal Improvement Act of 1913

For the

City of Newport Beach County of Orange, California

July 28, 2009

City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report

TABLE OF CONTENTS

Page

Introduction and Certifications ............................................................................................ 1

PART I Plans and Specifications ................................................................................... 4

PART II Cost Estimate ..................................................................................................... 5

PART III Assessment Roll and Method of Assessment Spread ..................................... 6

Table 1 -Assessment Roll .................................................................................. 8

Debt Limit Valuation ........................................................................................ 17

Exhibit 1 -Method and Formula of Assessment Spread .................................. 18

PART IV Annual Administrative Assessment .............................................................. 24

PART V Diagram of Assessment District ..................................................................... 25

PART VI Description of Facilities .................................................................................. 32

Right-of-Way Certificate .................................................................................. 33

Certification of Completion of Environmental Proceedings ............................ 34

APPENDIX

A. Excerpts from Assessment District No. 64 B. Assessment Calculations

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City of Newport Beach Underground Utility Assessment District No. 103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report

AGENCY: CITY OF NEWPORT BEACH

PROJECT: ASSESSMENT DISTRICT NO. 103

TO: CITY COUNCIL

ENGINEER'S "REPORT" PURSUANT TO THE PROVISIONS OF SECTIONS 2961 AND 10204 OF THE STREETS AND HIGHWAYS CODE

July 28, 2009

Page 1

The purposes of this Assessment District is to provide financing to underground power, telephone and cable facilities in the area generally bounded by G Street I East Balboa Boulevard I Channel Road I Ocean Boulevard. The proposed underground utility improvements will provide conversion to an upgraded utility system and will enhance neighborhood aesthetics, safety and reliability.

The construction of these improvements will conform to existing City of Newport Beach, Southern California Edison, AT&T and Time Warner Cable standards. By virtue of such improvements, the proposed improvements are of special and direct benefit to these properties.

Pursuant to the provisions of Article XIIID of the State Constitution, Part 7.5 of the "Special Assessment Investigation, Limitation and Majority Protest Act of 1931 ", being Division 4 of the Streets and Highways Code of the State of California, and the "Municipal Improvement Act of 1913 ", being Division 12 of said Code, and the Resolution of Intention, adopted by the City Council of the CITY OF NEWPORT BEACH, State of California, in connection with the proceedings for Assessment District No. 103 (hereinafter referred to as the "Assessment District"), I, Joan E. Cox, P.E., a Registered Professional Engineer and authorized representative of Harris & Associates, the duly appointed Engineer of Work, herewith submits the "Report" for the Assessment District, consisting of six (6) parts as stated below.

PART I

This part contains the plans and specifications which describe the general nature, location and extent for the proposed improvements to be constructed, and are filed herewith and made a part hereof. Said plans and specifications are on file in the Office of the Superintendent of Streets.

PART II

This part contains an estimate of the cost of the proposed improvements, including capitalized interest, if any, incidental costs and expenses in connection therewith as set forth herein and attached hereto.

PART III

This part consists of the foB owing information:

A. A proposed assessment of the total amount of the costs and expenses of the proposed improvements upon the several subdivisions of land within the Assessment District, in proportion to the special benefits to be received by such subdivisions from said improvements, which is set forth upon the assessment roll filed herewith and made a part hereof.

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City of Newport Beach Underground Utility Assessment District No. 103 (G St I E Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report

July 28, 2009

Page 2

B. The total amount, as near as may be determined, of the total principal sum of all unpaid special assessments and special assessments required or proposed to be levied under any completed or pending assessment proceedings, other than that contemplated for the Assessment District, which would require an investigation and report under the "Special Assessment Investigation, Limitation and Majority Protest Act of 1931" against the total area proposed to be assessed.

C. The total true value, determined from the latest Assessor's roll, of the parcels of land and improvements which are proposed to be assessed.

PART IV

This part contains the proposed maximum annual administrative assessment to be levied upon each subdivision or parcel of land within the Assessment District to pay the costs incurred by the CITY OF NEWPORT BEACH, and not otherwise reimbursed, resulting from the administration and collection of assessments, from the administration and registration of any associated bonds and reserve or other related funds, or both.

PARTV

This part contains a map showing the boundaries of the Assessment District, and a diagram showing the Assessment District, the boundaries and the dimensions of the subdivisions of land within said Assessment District, as the same existed at the time of the passage of the Resolution of Intention. The Boundary Map and Assessment Diagram are filed herewith and made a part hereof, and part of the assessment.

PART VI

This part shall consist of the following information:

A. Description of facilities B. Right-of-Way Certificate C. Environmental Certificate

This report is submitted on July 8, 2009.

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HARRIS & ASSOCIATES

JOAN E. COX, P.E. R.C.E. No. 41965 ENGINEER OF WORK CITY OF NEWPORT BEACH STATE OF CALIFORNIA

HI Harris & Associates

City of Newport Beach Underground Utility Assessment District No. 103 (G st IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report

July 28, 2009

Page 3

Prelimttt? approval by th~ CITY COUNCIL of the CITY OF NEWPORT BEACH, CALIFORNIA, on the day of \[UN~ , 2009.

CITYCLERK J CITY OF NEWPORT BEACH STATE OF CALIFORNIA

FJng\Jtpprovai)(,'A ~'CITY COUNCIL of the CITY OF NEWPORT BEACH~ CALIFORNIA, on the

:J!fl!__'day of 4 2009._ ~ 2~

~Q :B~ . -CIT--Y~C~L-ERK~~--~--j+-~-------

CITY OF NEWPORT BEACH STATE OF CALIFORNIA

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City of Newport Beach Underground Utility Assessment District No.103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report

Part I Plans and Specifications

July 28, 2009

Page 4

The plans and specifications to construct the utility undergrounding improvements, and any ancillary improvements thereof, for the area generally described as Assessment District No. 103, G Street I East Balboa Boulevard I Channel Road I Ocean Boulevard, describe the general nature, location and extent of the improvements for this Assessment District are referenced herein and incorporated as if attached and a part of this Report.

Said Plans and Specifications for the improvements are on file in the office of the Superintendent of Streets.

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Part II Cost Estimate

July 28, 2009

Page 5

Estimated Costs

DESIGN & CONSTRUCTION COSTS* Electrical Costs (Southern California Edison)

Electrical Construction Costs Construction Contingency (-1 0%) Edison Design Engineering

Telephone Costs (AT&T) Telephone Construction Costs Construction Contingency (-1 0%) AT&T Design Engineering

Street I Alley Rehabilitation Construction Contingency (-7.5%)

Estimated Utility Contribution for Equivalent Overhead System

Total Design & Construction Costs: Less deduct from contingency:

Modified Total Design & Construction Costs:

INCIDENTAL EXPENSES Assessment Engineering Contract Inspection Disclosure Counsel City Administration Financial Advisor Filing Fees Bond Counsel Paying Agent Dissemination Agent Financial Printing, Registration and Servicing Incidental Contingencies

Total Incidental Expenses: Less deduct from contingency:

Modified Total Incidental Expenses:

Total Construction and Incidental Expenses:

FINANCING COSTS Underwriter's Discount 1.25% Bond Reserve I Credit Enhancement 6.00% Funded Interest@ 12 months@ 5.75%

Total Financial Costs:

TOTAL AMOUNT TO ASSESSMENT:

Preliminary

$3,053,100 $305,310 $135,800

$3,494,210

$992,998 $99,300

$102,000 $1,194,298

$1,000,000 $75,000

$1,075,000

-$678,621

$5,084,887

$64,000 $75,000 $20,000

$100,000 $15,000 $5,000

$25,000 $3,000 $3,000

$10,000 $28,113

$348,113

$5,433,000

$78,000 $375,000 $359,000 $812,000

$6,245,000

* Time Warner Cable is required to pay for undergrounding through the Franchise Agreement with the City.

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Confirmed

$3,053,100 $305,310 $135,800

$3,494,210

$992,998 $99,300

$102,000 $1,194,298

$1,000,000 $75,000

$1,075,000

-$678,621

$5,084,887 -$19,744

$5,065,143

$64,000 $75,000 $20,000

$100,000 $15,000 $5,000

$25,000 $3,000 $3,000

$10,000 $28,113

$348,113 -$1,352

$346,761

$5,411,904

$77,759 $373,396 $357,693 $808,848

$6,220,752



Part Ill Assessment Roll and

Method of Assessment Spread

July 28, 2009

Page 6

WHEREAS, on June 9, 2009 the City Council of the CITY OF NEWPORT BEACH, State of California, did, pursuant to the provisions of the 1913 Act "Municipal Improvement Act of 1913", being Division 12 of the Streets and Highways Code, of the State of California, adopt its Resolution of Intention No. 2009-36, for the installation and construction of certain public improvements, together with appurtenances and appurtenant work in connection therewith, in a special assessment district known and designated as ASSESSMENT DISTRICT NO. 103 (hereinafter referred to as the "Assessment District"); and

WHEREAS, said Resolution of Intention, as required by law, did direct the Engineer of Work to make and file a "Report", consisting ofthe following as required by Section 10204 of the Act:

a. Plans

b. Specifications

c. Cost Estimates

d. Assessment Diagram showing the Assessment District and the subdivisions of land therein;

e. A proposed assessment of the costs and expenses of the works of improvement levied upon the parcels within the boundaries of the Assessment District;

f. The proposed maximum annual assessment to be levied upon each subdivision or parcel of land within the Assessment District to pay the costs incurred by the City and not otherwise reimbursed resulting from the administration and collection of assessments or from the administration and registration of any associated bonds and reserve or other related funds.

For particulars, reference is made to the Resolution of Intention as previously adopted.

NOW, THEREFORE, I, Joan E. Cox, the authorized representative of HARRIS & ASSOCIATES, pursuant to Article XIIID of the California Constitution and the "Municipal Improvement Act of 1913", do hereby submit the following:

1. Pursuant to the provisions of law and the Resolution of Intention, I have assessed the costs and expenses of the works of improvement to be performed in the Assessment District upon the parcels of land in the Assessment District specially benefited thereby in direct proportion and relation to the special benefits to be received by each of said parcels. For particulars as to the identification of said parcels, reference is made to the Assessment Diagram, a copy of which is attached hereto and incorporated herein.

2. As required by law, a Diagram is hereto attached, showing the Assessment District, as well as the boundaries and dimensions of the respective parcels and subdivisions of land within said District as the same existed at the time of the passage of said Resolution of Intention, each of which subdivisions of land or parcels or lots respectively have been given a separate number upon said Diagram and in said Assessment Roll.

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City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Page 7

3. The subdivisions and parcels of land the numbers therein as shown on the respective Assessment Diagram as attached hereto correspond with the numbers as appearing on the Assessment Roll as contained herein.

4. NOTICE IS HEREBY GIVEN that bonds will be issued in accordance with Division 10 of the Streets and Highways Code of the State of California (the "Improvement Bond Act of 1915"), to represent all unpaid assessments, which bonds shall be issued in one or more series, each with a term not to exceed the legal maximum term as authorized by law, THIRTY-NINE (39) YEARS from the 2nd day of September next succeeding twelve (12) months from their date. Said bonds shall bear interest at a rate not to exceed the current legal maximum rate of 12% per annum.

The bonds may be issued in more than one series, depending upon duration of the improvement work and related considerations.

5. By virtue of the authority contained in said "Municipal Improvement Act of 1913", and by further direction and order of the legislative body, I hereby recommend the following Assessment to cover the costs and expenses of the works of improvement for the Assessment District based on the costs and expenses as set forth below:

As P rei im inari ly As Approved Confirmed

Estimated Cost of Construction: $5,084,887 $5,065,143

Estimated Incidental Expenses: $348,113 $346,761

Estimated Financial Costs: $812,000 $808,848

Estimated Total to Assessment: $6,245,000 $6,220,752

For particulars as to the individual assessments and their descriptions, reference is made to Table 1 (Assessment Roll) attached hereto.

6. The Method of Spread of Assessment is as set forth in the exhibit identified as Part III (Exhibit 1 ), which is attached hereto, referenced and so incorporated.

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City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St I Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Page 8

Table 1 Assessment Roll

Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 1 048-201-47 $2,235,837 $0 $23,842.59 $23,749.81 94 2 048-201-46 $1,012,999 $0 $19,406.75 $19,331.24 52 3 048-201-41 $89,231 $0 $16,079.89 $16,017.32 6 4 048-201-40 $339,123 $0 $16,079.89 $16,017.32 21 5 048-201-39 $919,017 $0 $16,079.89 $16,017.32 57 6 048-201-38 $465,839 $0 $16,079.89 $16,017.32 29 7 048-201-37 $1,485,691 $0 $15,525.41 $15,464.99 96 8 048-201-52 $1,810,164 $0 $31,050.81 $30,929.98 59 9 048-201-34 $1,555,500 $0 $15,525.41 $15,464.99 101 10 048-201-33 $848,343 $0 $14,970.93 $14,912.67 57 11 048-201-32 $67,780 $0 $14,970.93 $14,912.67 5 12 048-201-31 $959,294 $0 $14,970.93 $14,912.67 64 13 048-201-30 $398,460 $0 $14,970.93 $14,912.67 27 14 048-201-29 $774,349 $0 $14,970.93 $14,912.67 52 15 048-201-44 $440,076 $0 $14,970.93 $14,912.67 30 16 048-201-45 $127,651 $0 $28,832.89 $28,720.70 4 17 048-201-26 $632,569 $0 $14,416.44 $14,360.34 44 18 048-201-25 $392,199 $0 $14,416.44 $14,360.34 27 19 048-201-24 $330,838 $0 $14,416.44 $14,360.34 23 20 048-201-23 $275,419 $0 $16,634.36 $16,569.64 17 21 048-201-22 $663,824 $0 $18,297.80 $18,226.60 36 22 048-201-48 $1 '157,771 $0 $16,079.89 $16,017.32 72 23 048-201-51 $972,728 $0 $15,525.41 $15,464.99 63

-------~---

24 048-201-50 $289,255 $0 $15,525.41 $15,464.99 19 ~-~----- ----

25 048-201-02 $89,231 $0 $13,861.97 $13,808.03 6 26 048-201-03 $94,130 $0 $13,861.97 $13,808.03 7 27 048-201-04 $674,814 $0 $13,861.97 $13,808.03 49 28 048-201-05 $1,011,926 $0 $13,861.97 $13,808.03 73 29 048-201-06 $265,579 $0 $13,861.97 $13,808.03 19 30 048-201-07 $785,777 $0 $13,861.97 $13,808.03 57

-------

31 048-201-08 $73,089 $0 $13,861.97 $13,808.03 5 32 048-201-09 $819,088 $0 $13,861.97 $13,808.03 59 33 048-201-10 $829,636 $0 $13,861.97 $13,808.03 60 34 048-201-11 $636,170 $0 $13,861.97 $13,808.03 46 35 048-201-12 $311,052 $0 $13,861.97 $13,808.03 23

--------

36 048-201-13 $344,459 $0 $13,861.97 $13,808.03 25 37 048-201-14 $743,973 $0 $13,861.97 $13,808.03 54 38 048-201-15 $1,043,551 $0 $13,861.97 $13,808.03 76

-----

39 048-201-16 $657,439 $0 $13,861.97 $13,808.03 48 40 048-201-17 $592,362 $0 $13,861.97 $13,808.03 43 41 048-201-18 $490,361 $0 $13,861.97 $13,808.03 36 42 048-201-19 $70,817 $0 $13,861.97 $13,808.03 5 43 048-201-20 $450,486 $0 $13,861.97 $13,808.03 33 44 048-201-21 $83,646 $0 $17,188.84 $17,121.95 5 45 048--192-01 $290,094 $0 $26,614.98 $26,511.41 11

Q:\Newport Beach\AD103\reports\ad103 final rpt 8jul09.doc HI Harris & Associates


Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 46 048-192-02 $99,716 $0 $19,406.75 $19,331.24 5 47 048-192-03 $414,955 $0 $39,922.48 $39,767.12 10 48 048-192-04 $2,086,920 $0 $22,179.15 $22,092.84 94 49 048-192-05 $1,043,551 $0 $22,179.15 $22,092.84 47 50 048-192-06 $1 '135,938 $0 $23,288.10 $23,197.48 49 51 048-192-07 $157,661 $0 $23,842.59 $23,749.81 7 52 048-192-08 $835,469 $0 $24,951.55 $24,854.45 34 53 048-192-09 $1,816,379 $0 $56,002.34 $55,784.05 33 54 048-191-19 $241,339 $0 $6,282.24 $6,257.80 39 55 048-191-02 $502,585 $0 $15,248.16 $15,188.83 33 56 048-191-03 $509,983 $0 $16,079.89 $16,017.32 32

--------57 048-191-04 $819,088 $0 $14,970.93 $14,912.67 55 58 048-191-05 $96,721 $0 $14,970.93 $14,912.67 6 59 048-191-06 $1,499,400 $0 $14,416.44 $14,360.34 104 60 048-191-07 $431,053 $0 $14,970.93 $14,912.67 29 61 048-191-08 $216,526 $0 $14,416.44 $14,360.34 15 62 048-191-09 $964,808 $0 $14,970.93 $14,912.67 65 63 048-191-10 $557,978 $0 $16,079.89 $16,017.32 35 64 048-191-11 $113,100 $0 $17,743.32 $17,674.27 6 65 930-504-15 $741,170 $0 $9,426.14 $9,389.46 79 66 930-504-16 $770,744 $0 $9,426.14 $9,389.46 82 67 930-504-17 $1 '1 09,500 $0 $9,426.14 $9,389.46 118 68 930-504-18 $770,744 $0 $9,426.14 $9,389.46 82 69 048-191-14 $1,045,302 $0 $18,297.80 $18,226.60 57 70 048-191-15 $2,347,989 $0 $16,634.36 $16,569.64 142 71 048-191-16 $877,242 $0 $18,297.80 $18,226.60 48 72 048-221-01 $1,680,823 $0 $18,852.28 $18,778.92 90 73 048-221-02 $86,471 $0 $14,416.44 $14,360.34 6 74 048-221-03 $338,112 $0 $14,416.44 $14,360.34 24 75 048-221-28 $152,829 $0 $29,387.37 $29,273.02 5 76 048-221-06 $78,674 $0 $14,416.44 $14,360.34 5 ___ " ___ 77 048-221-29 $111,092 $0 $21,624.68 $21,540.53 5 78 048-221-24 $3,125,000 $0 $21,624.68 $21,540.53 145 79 048-221-10 $402,816 $0 $14,416.44 $14,360.34 28 80 048-221-11 $1,689,074 $0 $14,416.44 $14,360.34 118 81 048-221-12 $332,946 $0 $14,416.44 $14,360.?4 23 82 048-221-13 $85,991 $0 $14,416.44 $14,360.34 6 83 048-221-14 $535,537 $0 $16,634.36 $16,569.64 32 84 048-221-34 $702,153 $0 $16,634.36 $16,569.64 42 85 048-221-35 $6,783,079 $0 $13,307.49 $13,255.71 512 86 048-221-22 $86,381 $0 $13,861.97 $13,808.03 6 87 048-221-21 $111,781 $0 $13,861.97 $13,808.03 8 88 048-221-20 $601,376 $0 $13,861.97 $13,808.03 44 89 048-221-19 $1 '180,926 $0 $13,861.97 $13,808.03 86 90 048-221-18 $362,788 $0 $13,861.97 $13,808.03 26 91 048-221-33 $818,369 $0 $13,861.97 $13,808.03 59 92 048-221-32 $1,985,000 $0 $13,861.97 $13,808.03 144



Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 93 048-221-31 $1,853,000 $0 $13,861.97 $13,808.03 134 94 048-221-30 $170,629 $0 $13,861.97 $13,808.03 12 95 048-221-26 $443,754 $0 $13,861.97 $13,808.03 32 96 048-221-27 $116,067 $0 $13,307.49 $13,255.71 9 97 048-220-01 N/A $0 $0.00 $0.00 N/A 98 048-222-01 $2,406,000 $0 $13,307.49 $13,255.71 182 99 048-222-02 $193,322 $0 $13,861.97 $13,808.03 14 100 048-222-03 $648,681 $0 $13,861.97 $13,808.03 47 101 048-222-04 $2,142,000 $0 $13,861.97 $13,808.03 155 102 048-222-05 $1,679,000 $0 $13,861.97 $13,808.03 122 103 048-222-06 $579,914 $0 $13,861.97 $13,808.03 42 104 048-222-07 $200,011 $0 $13,861.97 $13,808.03 14 105 048-222-08 $861 '199 $0 $13,861.97 $13,808.03 62 106 048-222-09 $904,937 $0 $13,861.97 $13,808.03 66 107 048-222-10 $776,464 $0 $13,861.97 $13,808.03 56 108 048-222-11 $180,236 $0 $13,861.97 $13,808.03 13 109 048-222-32 $164,489 $0 $13,861.97 $13,808.03 12 110 048-222-33 $510,117 $0 $13,861.97 $13,808.03 37 111 048-222-34 $376,834 $0 $14,416.44 $14,360.34 26 112 048-222-35 $1,050,561 $0 $14,970.93 $14,912.67 70 113 048-222-27 $106,490 $0 $15,525.41 $15,464.99 7 114 048-222-26 $865,309 $0 $14,416.44 $14,360.34 60 115 048-222-25 $138,161 $0 $14,970.93 $14,912.67 9 116 048-222-24 $1,490,130 $0 $15,525.41 $15,464.99 96 117 048-222-23 $84,613 $0 $16,079.89 $16,017.32 5 118 048-222-22 $237,769 $0 $16,634.36 $16,569.64 14 119 048-222-21 $87,094 $0 $17,188.84 $17,121.95 5 120 048-222-20 $90,608 $0 $17,188.84 $17,121.95 5 121 048-222-19 $83,092 $0 $17,743.32 $17,674.27 5 122 048-222-31 $1,826,214 $0 $18,297.80 $18,226.60 100 123 048-222-30 $171,808 $0 $18,297.80 $18,226.60 9 124 048-222-28 $94,820 $0 $18,852.28 $18,778.92 5 125 048-222-29 $686,340 $0 $18,852.28 $18,778.92 37 126 048-222-16 $752,117 $0 $17,188.84 $17,121.95 44 127 048-222-37 $1,850,000 $0 $17,188.84 $17,121.95 108 128 048-222-36 $646,894 $0 $18,297.80 $18,226.60 35 129 048-211-36 $860,389 $0 $14,970.93 $14,912.67 58 130 048-211-35 $674,344 $0 $13,861.97 $13,808.03 49 131 048-211-34 $877,242 $0 $13,861.97 $13,808.03 64 132 048-211-02 $75,222 $0 $13,861.97 $13,808.03 5 133 048-211-03 $1,212,902 $0 $13,861.97 $13,808.03 88 134 048-211-37 $422,649 $0 $13,861.97 $13,808.03 31 135 048-211-38 $3,001,500 $0 $13,861.97 $13,808.03 217 136 048-211-05 $94,542 $0 $13,861.97 $13,808.03 7 137 048-211-06 $80,609 $0 $13,861.97 $13,808.03 6 138 048-211-27 $857,212 $0 $13,861.97 $13,808.03 62



Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 139 048-211-28 $81,919 $0 $13,861.97 $13,808.03 6 140 048-211-08 $1,732,266 $0 $13,861.97 $13,808.03 125 141 048-211-09 $418,094 $0 $13,861.97 $13,808.03 30 142 048-211-10 $728,909 $0 $13,861.97 $13,808.03 53 143 048-211-11 $514,578 $0 $13,861.97 $13,808.03 37 144 048-211-12 $1,565,326 $0 $13,307.49 $13,255.71 118 145 048-211-39 $1,819,000 $0 $16,634.36 $16,569.64 110 146 048-211-40 $459,369 $0 $14,416.44 $14,360.34 32 147 048-211-23 $1,560,600 $0 $14,416.44 $14,360.34 109 148 048-211-22 $549,744 $0 $14,416.44 $14,360.34 38 149 048-211-21 $1,379,570 $0 $14,416.44 $14,360.34 96 150 048-211-20 $954,279 $0 $14,416.44 $14,360.34 66 151 048-211-19 $89,167 $0 $14,416.44 $14,360.34 6 152 048-211-18 $213,926 $0 $14,416.44 $14,360.34 15 153 048-211-17 $142,317 $0 $14,416.44 $14,360.34 10 154 048-211-30 $317,114 $0 $14,416.44 $14,360.34 22 155 048-211-32 $112,552 $0 $14,416.44 $14,360.34 8 156 048-211-31 $394,187 $0 $14,416.44 $14,360.34 27 157 048-211-25 $675,841 $0 $14,416.44 $14,360.34 47 158 048-211-15 $1,480,385 $0 $14,416.44 $14,360.34 103 159 048-211-14 $1,826,214 $0 $14,416.44 $14,360.34 127 160 048-211-13 $1,826,214 $0 $16,634.36 $16,569.64 110 161 048-261-30 $2,001 ,415 $0 $17,743.32 $17,674.27 113 162 048-261-29 $85,648 $0 $14,416.44 $14,360.34 6 163 048-261-28 $440,871 $0 $14,416.44 $14,360.34 31 164 048-261-33 $892,805 $0 $14,416.44 $14,360.34 62 165 048-261-34 $106,753 $0 $14,416.44 $14,360.34 7 166 048-261-31 $1,653,959 $0 $14,416.44 $14,360.34 115 167 048-261-32 $378,558 $0 $14,416.44 $14,360.34 26 168 048-261-25 $88,820 $0 $14,416.44 $14,360.34 6 169 048-261-24 $1 '144,344 $0 $14,416.44 $14,360.34 80 170 048-261-23 $166,009 $0 $14,416.44 $14,360.34 12 171 048-261-22 $84,959 $0 $14,416.44 $14,360.34 6 172 048-261-21 $367,135 $0 $14,416.44 $14,360.34 26 173 048-261-20 $1,800,000 $0 $14,416.44 $14,360.34 125 174 048-261-19 $1,826,214 $0 $14,416.44 $14,360.34 127 175 048-261-18 $1,836,000 $0 $14,416.44 $14,360.34 128 176 048-261-17 $192,831 $0 $17,743.32 $17,674.27 11

--------

177 048-261-01 $753,270 $0 $16,634.36 $16,569.64 45 178 048-261-02 $127,786 $0 $11,644.06 $11,598.74 11 179 048-261-03 $1,095,098 $0 $11,644.06 $11,598.74 94 180 048-261-04 $2,050,000 $0 $11,644.06 $11,598.74 177 181 048-261-05 $887,204 $0 $11,644.06 $11,598.74 76 182 048-261-06 $2,395,000 $0 $11,644.06 $11,598.74 206

----

183 048-261-07 $76,744 $0 $11,644.06 $11,598.74 7 184 048-261-08 $602,681 $0 $17,743.32 $17,674.27 34

Q:\Newport Beach\ADI03\reports\ad103 final rpt 8jul09.doc HI Harris & Associates

City of Newport Beach July 28, 2009 Underground Utility Assessment District No.103 (G St I Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Page 12

Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 185 048-261-09 $847,147 $0 $17,188.84 $17,121.95 49 186 048-261-35 $416,927 $0 $11,644.06 $11,598.74 36 187 048-261-36 $133,098 $0 $11,644.06 $11,598.74 11 188 048-261-11 $431,551 $0 $11,644.06 $11,598.74 37 189 048-261-12 $401,098 $0 $11,644.06 $11,598.74 35 190 048-261-13 $834,521 $0 $11,644.06 $11,598.74 72 191 048-261-14 $2,734,000 $0 $11,644.06 $11,598.74 236 192 048-261-15 $783,068 $0 $11,644.06 $11,598.74 68 193 048-261-16 $83,188 $0 $16,634.36 $16,569.64 5 194 048-252-12 $1,292,154 $0 $33,268.72 $33,139.26 39 195 048-252-11 $3,130,652 $0 $13,307.49 $13,255.71 236 196 048-252-10 $150,136 $0 $12,753.02 $12,703.39 12 197 048-252-15 $190,670 $0 $38,813.52 $38,662.47 5 198 048-252-14 $424,023 $0 $11,644.06 $11,598.74 37 199 048-252-13 $73,019 $0 $11,644.06 $11,598.74 6 200 048-252-19 $74,400 $0 $7,762.70 $7,732.49 10 201 048-252-18 $74,611 $0 $7,762.70 $7,732.49 10 202 048-252-05 $101,859 $0 $15,525.41 $15,464.99 7 203 048-252-21 $743,973 $0 $9,980.62 $9,941.78 75 204 048-252-20 $1,955,952 $0 $11,644.06 $11,598.74 169 205 048-252-03 $95,785 $0 $17,743.32 $17,674.27 5 206 048-252-02 $69,847 $0 $11,644.06 $11,598.74 6 207 048-252-17 $1,778,000 $0 $14,416.44 $14,360.34 124 208 048-252-16 $827,929 $0 $14,416.44 $14,360.34 58 209 048-251-21 $99,093 $0 $27,723.94 $27,616.05 4 210 048-251-22 $84,471 $0 $22,179.15 $22,092.84 4 211 048-251-23 $377,757 $0 $22,179.15 $22,092.84 17 212 048-251-24 $467,118 $0 $22,179.15 $22,092.84 21 213 048-251-25 $1,294,673 $0 $22,179.15 $22,092.84 59 214 048-251-26 $2,043,887 $0 $22,179.15 $22,092.84 93 215 048-251-27 $2,247,000 $0 $22,179.15 $22,092.84 102 216 048-251-28 $92,401 $0 $22,179.15 $22,092.84 4 217 048-251-29 $80,195 $0 $22,179.15 $22,092.84 4 218 048-251-30 $694,533 $0 $22,179.15 $22,092.84 31 219 048-251-31 $386,456 $0 $22,179.15 $22,092.84 17 220 048-251-32 $1,026,555 $0 $22,179.15 $22,092.84 46 221 048-251-33 $80,743 $0 $22,179.15 $22,092.84 4 222 048-251-07 $186,148 $0 $22,179.15 $22,092.84 8 223 048-251-06 $256,533 $0 $28,184.16 $28,074.49 9 224 048-251-37 $1,716,922 $0 $32,159.76 $32,034.62 54 225 048-251-38 $1,273,106 $0 $28,832.89 $28,720.70 44 226 048-251-34 $419,569 $0 $27,723.94 $27,616.05 15 227 048-251-35 $599,027 $0 $27,723.94 $27,616.05 22 228 048-251-14 $477,870 $0 $22,179.15 $22,092.84 22 229 048-251-15 $108,334 $0 $22,179.15 $22,092.84 5 230 048-251-16 $763,463 $0 $22,179.15 $22,092.84 35

Q:\Newport Beach\AD103\reports\adl03 final rpt 8jul09.doc HI Harris & Associates


Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 231 048-251-17 $190,275 $0 $22,179.15 $22,092.84 9 232 048-251-18 $194,204 $0 $22,179.15 $22,092.84 9 233 048-251-19 $820,237 $0 $22,179.15 $22,092.84 37 234 048-251-20 $1,427,241 $0 $22,179.15 $22,092.84 65 235 048-251-02 $527,244 $0 $22,179.15 $22,092.84 24 236 048-251-03 $129,966 $0 $22,179.15 $22,092.84 6 237 048-251-04 $957,220 $0 $22,179.15 $22,092.84 43 238 048-251-05 $96,330 $0 $24,025.56 $23,932.07 4 239 048-272-28 $1,984,458 $0 $17,743.32 $17,674.27 112 240 048-272-29 $1 J 114,952 $0 $17,743.32 $17,674.27 63 241 048-272-20 $966,435 $0 $15,525.41 $15,464.99 62 242 048-272-19 $2,084,613 $0 $15,525.41 $15,464.99 135 243 048-272-31 $568,930 $0 $15,525.41 $15,464.99 37 244 048-272-30 $1,284,165 $0 $15,525.41 $15,464.99 83 245 048-272-04 $108,820 $0 $15,525.41 $15,464.99 7 246 048-272-05 $557,395 $0 $15,525.41 $15,464.99 36 247 048-272-24 $905,653 $0 $15,525.41 $15,464.99 59 248 048-272-32 $612,046 $0 $15,525.41 $15,464.99 40 249 048-272-33 $416,928 $0 $15,525.41 $15,464.99 27 250 048-272-22 $455,419 $0 $15,525.41 $15,464.99 29 251 048-272-26 $527,023 $0 $15,525.41 $15,464.99 34 252 048-272-27 $90,540 $0 $15,525.41 $15,464.99 6 253 048-272-21 $1 J 105,601 $0 $52,121.00 $51,918.18 21 254 048-272-09 $495,528 $0 $13,861.97 $13,808.03 36 255 048-272-10 $1,590,180 $0 $13,861.97 $13,808.03 115 256 048-272-11 $111,027 $0 $13,861.97 $13,808.03 8 257 048-272-12 $1,098,275 $0 $13,307.49 $13,255.71 83 258 048-272-18 $758,935 $0 $16,079.89 $16,017.32 47 259 048-272-17 $1 J 129,444 $0 $13,861.97 $13,808.03 82 260 048-272-16 $1,053,116 $0 $13,861.97 $13,808.03 76 261 048-272-15 $499,909 $0 $13,861.97 $13,808.03 36 262 048-272-14 $1,567,038 $0 $13,861.97 $13,808.03 113 263 048-272-13 $148,139 $0 $14,970.93 $14,912.67 10 264 048-271-30 $760,092 $0 $15,525.41 $15,464.99 49 265 048-271-29 $1,357,284 $0 $15,525.41 $15,464.99 88 266 048-271-17 $527,343 $0 $13,861.97 $13,808.03 38 267 048-271-28 $184,631 $0 $17,188.84 $17,121.95 11 268 048-271-26 $90,750 $0 $17,188.84 $17,121.95 5 269 048-271-25 $168,835 $0 $17,188.84 $17,121.95 10 270 048-271-27 $167,460 $0 $17,188.84 $17,121.95 10 271 048-271-14 $423,837 $0 $13,861.97 $13,808.03 31 272 048-271-13 $94,681 $0 $13,861.97 $13,808.03 7 273 048-271-21 $3,008,994 $0 $20,515.72 $20,435.88 147 274 048-271-23 $771,481 $0 $12,753.02 $12,703.39 61

275- 048-271-31 $380,588 $0 $14,787.95 $14,730.40 26 276 048-271-19 $484,534 $0 $15,525.41 $15,464.99 31

Q:\Newport Beach\AD103\reports\ad103 final rpt 8jul09.doc HI Hartis & Assodates


Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 277 048-271-01 $445,916 $0 $14,970.93 $14,912.67 30 278 048-271-02 $152,273 $0 $27,169.46 $27,063.73 6 279 048-271-03 $71,712 $0 $13,861.97 $13,808.03 5 280 048-271-32 $425,881 $0 $13,861.97 $13,808.03 31 281 048-271-33 $1,237,895 $0 $13,861.97 $13,808.03 90 282 048-271-05 $2,354,289 $0 $13,861.97 $13,808.03 171 283 048-271-06 $972,514 $0 $27,169.46 $27,063.73 36 284 048-271-07 $2,580,224 $0 $26,060.50 $25,959.09 99 285 048-271-08 $350,784 $0 $12,753.02 $12,703.39 28 286 048-271-09 $1,346,138 $0 $6,653.75 $6,627.85 203 287 048-302-01 $238,455 $0 $18,297.80 $18,226.60 13 288 048-302-02 $757,406 $0 $16,634.36 $16,569.64 46 289 048-302-03 $914,679 $0 $16,634.36 $16,569.64 55 290 048-302-04 $722,259 $0 $16,634.36 $16,569.64 44 291 048-302-05 $132,684 $0 $16,634.36 $16,569.64 8 292 048-302-06 $105,991 $0 $16,634.36 $16,569.64 6 293 048-302-07 $126,413 $0 $16,634.36 $16,569.64 8 294 048-302-08 $2,465,000 $0 $16,634.36 $16,569.64 149 295 048-302-09 $877,501 $0 $16,634.36 $16,569.64 53 296 048-302-10 $817,519 $0 $16,634.36 $16,569.64 49 297 048-302-11 $129,861 $0 $18,297.80 $18,226.60 7 298 048-302-17 $712,867 $0 $22,179.15 $22,092.84 32 299 048-302-16 $145,469 $0 $18,297.80 $18,226.60 8 300 048-302-15 $120,682 $0 $18,297.80 $18,226.60 7 301 048-302-14 $550,044 $0 $18,297.80 $18,226.60 30 302 048-302-13 $322,904 $0 $18,297.80 $18,226.60 18 303 048-302-12 $227,908 $0 $21,070.19 $20,988.20 11 304 048-290-01 N/A $0 $0.00 $0.00 N/A

305 048-291-01 $871,988 $0 $13,307.49 $13,255.71 66 306 048-291-02 $171,163 $0 $13,307.49 $13,255.71 13 307 048-291-22 $1,349,631 $0 $13,307.49 $13,255.71 102 308 048-291-23 $2,340,900 $0 $13,861.97 $13,808.03 170 309 048-291-20 $575,452 $0 $19,961.23 $19,883.55 29 310 048-291-26 $997,268 $0 $13,861.97 $13,861.97 72 311 048-291-19 $1,227,595 $0 $13,307.49 $13,255.71 93 312 048-291-18 $104,681 $0 $13,861.97 $13,808.03 8 313 048-291-17 $559,071 $0 $13,861.97 $13,808.03 40 314 048-291-24 $1,975,865 $0 $13,861.97 $13,808.03 143 315 048-291-25 $105,849 $0 $13,861.97 $13,808.03 8 316 048-291-15 $138,002 $0 $13,861.97 $13,808.03 10 317 048-291-14 $505,665 $0 $13,861.97 $13,808.03 37 318 048-291-13 $1 '167,027 $0 $13,861.97 $13,808.03 85 319 048-291-12 $94,332 $0 $16,079.89 $16,017.32 6 320 048-291-06 $2,846,000 $0 $16,634.36 $16,569.64 172 321 048-291-07 $2,436,525 $0 $15,525.41 $15,464.99 158 322 048-291-08 $1,364,761 $0 $15,525.41 $15,464.99 88



Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 323 048-291-09 $525,399 $0 $15,525.41 $15,464.99 34 324 048-291-10 $1,114,061 $0 $15,525.41 $15,464.99 72 325 048-291-11 $2,500,000 $0 $9,148.90 $9,113.30 274 326 048-292-28 $505,120 $0 $16,079.89 $16,017.32 32 327 048-292-29 $1,924,740 $0 $13,861.97 $13,808.03 139 328 048-292-02 $1,196,981 $0 $13,861.97 $13,808.03 87 329 048-292-03 $727,807 $0 $13,861.97 $13,808.03 53 330 048-292-04 $716,117 $0 $13,861.97 $13,808.03 52 331 048-292-05 $1,750,000 $0 $13,861.97 $13,808.03 127 332 048-292-06 $137,932 $0 $13,861.97 $13,808.03 10 333 048-292-07 $1,586,610 $0 $13,861.97 $13,808.03 115 334 048-292-27 $89,164 $0 $14,970.93 $14,912.67 6 335 048-292-26 $727,613 $0 $14,970.93 $14,912.67 49 336 048-292-32 $82,121 $0 $14,970.93 $14,912.67 6 337 048-292-33 $575,461 $0 $14,970.93 $14,912.67 39 338 048-292-10 $185,324 $0 $16,634.36 $16,569.64 11 339 048-292-25 $2,105,000 $0 $14,416.44 $14,360.34 147 340 048-292-24 $868,494 $0 $13,861.97 $13,808.03 63 341 048-292-23 $672,882 $0 $13,861.97 $13,808.03 49 342 048-292-22 $88,676 $0 $13,861.97 $13,808.03 6 343 048-292-21 $982,907 $0 $13,861.97 $13,808.03 71 344 048-292-20 $98,475 $0 $13,861.97 $13,808.03 7 345 048-292-19 $514,846 $0 $11,644.06 $11,598.74 44 346 048-292-18 $431,376 $0 $11,644.06 $11,598.74 37 347 048-292-17 $95,169 $0 $11,644.06 $11,598.74 8 348 048-292-35 $564,217 $0 $11,644.06 $11,598.74 49 349 048-292-34 $1,068,457 $0 $13,861.97 $13,808.03 77 350 048-292-15 $351,436 $0 $12,753.02 $12,703.39 28 351 048-292-14 $162,762 $0 $12,753.02 $12,703.39 13 352 048-292-13 $197,001 $0 $12,753.02 $12,703.39 16 353 048-292-12 $162,559 $0 $12,753.02 $12,703.39 13 354 048-292-11 $1,263,768 $0 $12,015.55 $11,968.79 106 355 048-281-01 $122,735 $0 $16,634.36 $16,569.64 7 356 048-281-02 $765,067 $0 $13,861.97 $13,808.03 55 357 048-281-03 $2,075,598 $0 $13,861.97 $13,808.03 150 358 048-281-04 $490,708 $0 $13,861.97 $13,808.03 36 359 048-281-05 $1,677,769 $0 $13,861.97 $13,808.03 122 360 048-281-06 $329,284 $0 $13,861.97 $13,808.03 24 361 048-281-31 $118,675 $0 $12,198.53 $12,151.06 10 362 048-281-36 $87,026 $0 $14,970.93 $14,912.67 6 363 048-281-35 $219,398 $0 $14,416.44 $14,360.34 15 364 048-281-09 $203,064 $0 $14,416.44 $14,360.34 14 365 048-281-10 $94,334 $0 $14,416.44 $14,360.34 7 366 048-281-11 $992,191 $0 $14,416.44 $14,360.34 69 367 048-281-12 $960,218 $0 $14,416.44 $14,360.34 67 368 048-281-13 $80,952 $0 $14,416.44 $14,360.34 6

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Assessor's Total Assessments as Assessments Value Asmt Parcel True Existing Preliminarily as Confirmed to Lien No. Number Value Liens Approved and Recorded Ratio 369 048-281-37 $477,515 $0 $16,634.36 $16,569.64 29 370 048-281-38 $714,053 $0 $17,188.84 $17,121.95 42 371 048-281-30 $1,063,688 $0 $17,743.32 $17,674.27 60 372 048-281-29 $146,961 $0 $14,416.44 $14,360.34 10 373 048-281-28 $1,768,680 $0 $14,416.44 $14,360.34 123 374 048-281-27 $286,911 $0 $14,416.44 $14,360.34 20 375 048-281-26 $163,041 $0 $14,416.44 $14,360.34 11 376 048-281-25 $2,184,840 $0 $14,416.44 $14,360.34 152 377 048-281-24 $1,023,469 $0 $14,416.44 $14,360.34 71 378 048-281-39 $780,653 $0 $18,297.80 $18,226.60 43 379 048-281-21 $103,028 $0 $18,297.80 $18,226.60 6 380 048-281-20 $1,135,719 $0 $17,188.84 $17,121.95 66 381 048-281-19 $2,468,400 $0 $26,060.50 $25,959.09 95 382 048-281-18 $715,083 $0 $23,842.59 $23,749.81 30 383 048-281-33 $1,071,606 $0 $16,634.36 $16,569.64 65 384 048-281-34 $159,178 $0 $19,961.23 $19,883.55 8 385 048-281-16 $138,345 $0 $21,070.19 $20,988.20 7 386 048-281-15 $3,425,000 $0 $24,951'.55 $24,854.45 138

$298,153,641 $0 $6,245,000.00 $6,220,752.00 48

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Table 2 Debt Limit Valuation

A. ESTIMATED BALANCE TO ASSESSMENT $6,220,752

B. UNPAID SPECIAL ASSESSMENTS $0 *

TOTAL A& B $6,220,752

C. TRUE VALUE OF PARCELS $298,153,641 **

AVERAGE VALUE TO LIEN RATIO 48:1

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Page 17

* Unpaid Special Assessments shall consist of the total principal sum of all unpaid special assessments previously levied or proposed to be levied other than in the instant proceedings.

** True Value of Parcels means the total value of the land and improvements as estimated and shown on the last equalized roll of the County or as otherwise reasonably calculated.

This report does not represent a recommendation of parcel value, economic viability or financial feasibility, as that is not the responsibility of the Assessment Engineer.

CERTIFICATION

I, the undersigned Assessment Engineer, do hereby certify that (i) the total amount of the principal sum of the special assessments proposed to be levied, together with the principal amount of previously levied special assessments, as set forth above, do not exceed one-half (1/2) the total true value of the parcels proposed to be assessed, and (ii) the amount proposed to be assessed upon any parcel does not exceed one-half of the true value of the parcel.

EXECUTED on July 8, 2009.

HARRIS & ASSOCIATES

JO~ R.C.E. No. 41965 ASSESSMENT ENGINEER CITY OF NEWPORT BEACH COUNTY OF ORANGE, STATE OF CALIFORNIA

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Exhibit 1 Method and Formula of Assessment Spread

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Since the improvements are to be funded by the levying of assessments, the "Municipal Improvement Act of 1913" and Article XIIID of the State Constitution require that assessments must be based on the special benefit that the properties receive from the works of improvement. In addition, Section 4 of Article XIIID of the State Constitution requires that a parcel's assessment may not exceed the reasonable cost of the proportional special benefit conferred on that parcel. Section 4 provides that only special benefits are assessable and the local agency levying the assessment must separate the general benefits from the special benefits. It also provides that parcels within a district that are owned or used by any public agency, the State of California, or the United States shall not be exempt from assessment unless the agency can demonstrate by clear and convincing evidence that those publicly owned parcels in fact receive no special benefit. Neither the Act nor the State Constitution specifies the method or formula that should be used to apportion the costs to properties in any special assessment district proceedings.

The responsibility for recommending an apportionment of the costs to properties which specially benefit from the improvements rests with the Assessment Engineer, who is appointed for the purpose of making an analysis of the facts and determining the correct apportionment of the assessment obligation. In order to apportion the assessments to each parcel in direct proportion with the special benefit which it will receive from the improvements, an analysis has been completed and is used as the basis for apportioning costs to each property within the Assessment District.

Based upon an analysis of the special benefit to be received by each parcel from the construction of the works of improvement, the Assessment Engineer recommends the apportionment of costs as outlined below. The final authority and action rests with the City Council after hearing all testimony and evidence presented at a public hearing, and tabulating the assessment ballots previously mailed to all record owners of property within the Assessment District. Upon the conclusion of the public hearing, the City Council must make the final determination whether or not the assessment spread has been made in direct proportion to the special benefits received by each parcel within the Assessment District. Ballot tabulation will be done at that time and, if a majority of the returned ballots weighted by assessment amount are not in opposition to the Assessment District, the City Council may form the Assessment District.

The following sections set forth the methodology used to apportion the costs of the improvements to each parcel.

SPECIAL BENEFITS

In further making the analysis, it is necessary that the properties receive a special benefit distinguished from general benefits conferred on real property located in the District or to the public at large.

The purpose of this Assessment District is to provide the financing to underground existing overhead electrical, telephone and cable facilities as well as rehabilitate the affected portions of streets and alleys within the District. These facilities are the direct source of service to the properties within the Assessment District.



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The proposed replacement of existing overhead utility facilities (power, telephone and cable facilities) with underground facilities and removal of the existing utility poles and the overhead wires will provide a special benefit to the parcels connected to and adjacent to, or in near proximity of, the facilities as follows:

• Improved Aesthetics Benefit. This benefit relates to the improved aesthetics of the streetscape due to the removal of overhead wires and utility poles. The removal of guy wires and other support structures related to the overhead facilities are included in the definition of improved aesthetics. Properties that are adjacent to, or in proximity of, overhead facilities receive an aesthetic benefit.

• Additional Safety Benefit. This benefit relates to the additional safety of having the overhead distribution wires placed underground and having the power poles removed, which eliminates the threat of downed utility lines and poles due to wind, rain and other unforeseeable events. Falling facilities can lead to personal injuries and damage to structures, including fire. Properties immediately adjacent to the facilities usually have a greater risk. Furthermore, in compact communities like Balboa Peninsula, the negative effects of falling lines and poles are more widespread including blocked roadways and alleys, and property damage due to impact. Properties that are adjacent to, or in proximity of, overhead facilities receive a safety benefit.

• Connection Benefit. This benefit relates to the enhanced reliability of service from the utilities being underground, due to having all new wires and equipment and having that equipment underground, which reduces the threat of service interruption from downed lines. When compared to overhead systems, fewer outages occur due to various acts of nature, traffic collisions and obstructions (such as trees). Properties that are connected to, or have the ability to connect to, the facilities proposed to be undergrounded receive a connection benefit.

By virtue of such special benefits, the proposed improvements will provide a higher level of service, increase the desirability of the properties and will specifically enhance the values of the properties within the Assessment District. Therefore, the proposed improvements are of direct and special benefit to these properties.

GENERAL BENEFITS

Section 4 of Article XIIID requires that the general benefits imparted by the utility undergrounding project be separated from the special benefits and that only the special benefit portion of the costs of the project be assessed against those parcels which are identified as receiving special benefits. Separating the general from the special benefits requires an examination of the facts and circumstances of the project and the property being assessed.

In this particular assessment district, the streets and alleys along which the existing overhead utility facilities are being undergrounded function as local and collector streets. No roadways are designated as an arterial, a major arterial or a scenic corridor in the Transportation Element of the City's General Plan. Furthermore, the City has an established network of arterial streets which appear to function as intended to provide for the movement of traffic around and through the community at large without the need to utilize local collector streets for such purposes. Under these circumstances, any use of the streets within the assessment district as "through" streets is incidental.

With the exception of the City park properties, the properties situated within the assessment district are zoned exclusively as residential. Under this circumstance, the impacts, both visual and safety, are largely isolated to those properties (and the persons who inhabit them) which front on these local

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streets and alleys, with only incidental impacts on those who visit homes within the assessment district or who pass through the assessment district on trips originating outside the boundary and having a destination outside the boundary.

Based on these facts and circumstances, any general benefits to the property within the assessment district in general, to the surrounding community and to the public at large from the project of undergrounding these local overhead utility facilities on the local streets and alleys, such as to the general public visiting in cars, on bikes or on foot, are incidental and do not exceed five percent (5%) of the estimated project costs. Therefore, only the net amount of$5,475,332 ofthe estimated project construction costs is considered the special benefit portion of the construction costs. This general benefit portion of the cost is more than offset by the 13+o/o utility company contribution.

METHODOLOGY

Based upon the findings described above, the special benefit received by the properties within the boundaries of the Assessment District is the conversion from an overhead to an underground utility system resulting in additional safety, enhanced reliability, and improved aesthetics to the adjacent properties.

Based on these conditions, it is our conclusion that the improvements specially benefit all assessed properties in the Assessment District.

To establish the benefit to the individual parcels within the Assessment District, the highest and best use of each prope1iy is considered. For example, a vacant property is considered developed to its highest potential and connected to the system.

The more a property is developed, the more it benefits from the proposed improvements. Most of properties within this Assessment District are zoned residential and some have one or two dwelling units on them. There is a direct correlation between the size of a property and the extent to which a property may develop. Because parcel size is one of the main limiting factors for what can be built on a property, or the extent the property is developed, the size of each parcel is used as the base unit for measuring benefit.

The area of each property has been rounded to the nearest 100 square feet (sf), which accounts for any minor area calculation inconsistencies.

Consideration was given to reducing the amount of area assigned to parcels based upon the building setbacks applicable to each parcel. Due to the combined factors of (a) significant variations in the setback requirements, including front, side and rear setbacks, (b) availability of future variances from currently applicable setback requirements as well as existing variances already in place, and (c) significant variations in the ratios between building size and lot size, it was concluded that adjustments to parcel areas on account of setback requirements would not improve upon the assessment methodology. Accordingly, no reductions have been made to parcel area based upon applicable setback requirements.

The area of a condominium is calculated by taking the area of the base parcel and dividing by the number of condominiums.

The special benefits from the undergrounding of overhead utilities are categorized into the three (3) distinct benefits identified above. All parcels within the District, except for the few exceptions



July 28, 2009

Page 21

identified below, receive 3 of the 3 benefits (which is a factor of 1 ). Therefore, their rounded parcel areas are multiplied by 1 to calculate the "Assessed Parcel Area" on which costs are apportioned.

Note: In 1995, Assessment Nos. 291, 292, 293, 294, 295, 296 and 297 were included in Assessment District No. 64. These properties were previously assessed for their improved view of Newport Harbor due to the wires and poles being removed adjacent to the City park across Balboa Boulevard I Channel Road. These properties were not assessed for improved neighborhood aesthetics, improved safety or connection benefits associated from the previous undergrounding of the overhead utilities, and were specifically given a credit, that was applied to their calculated assessment amount, to make sure they were not doubly assessed for the future undergrounding of the poles and wires serving their properties (reference is made to pages 8 and 9 of Final Engineer's Report, dated June 1, 1995, which are provided in Appendix A). Therefore, these properties receive full benefits from this proposed undergrounding and are not considered to be assessed twice for the same benefits.

Exceptions

The following are parcels whose benefits do not fit the above methodology, as explained below.

1. Assessment Nos. 55, 223, 238, 275 and 354. The poles, wires and guy wires to be undergrounded are in close proximity to these lots, although not directly adjacent; therefore, these properties are assigned 112 Aesthetic Benefits. However, because the poles and wires are close enough to encroach on the property should they fall, these properties are considered to receive full Safety Benefits. Therefore, theses parcels receive 2-1/2 of 3 benefits and their rounded property area is multiplied by a factor of 5/6.

2. Assessment No. 54 and 286. The poles, wires and guy wires to be undergrounded are not in close proximity to these properties and do not provide significant aesthetic benefits to these properties, nor would they encroach upon these properties should they fall. Therefore, these properties are assigned 0 Aesthetic Benefits and 0 Safety Benefits. Therefore, these parcels receive 1 of 3 benefits and their rounded property area is multiplied by a factor of 1/3.

3. Assessment No. 325. The poles, wires and guy wires to be undergrounded are in close proximity to this parcel, although not directly adjacent; therefore, this property is assigned 1/2 Aesthetic Benefits. Excluding guy wires, which are support structures to the overhead facilities and poles, the poles and wires to be undergrounded are not in close proximity to this property, and would not encroach upon this property should they fall; therefore, this property is assigned 0 Safety Benefits. Therefore, this parcel receives 1-1/2 of 3 benefits and its rounded property area is multiplied by a factor of 112.

4. Assessment Nos. 97, 304 and the park property adjacent to Assessment No. 54. These properties are small neighborhood pocket-parks with no potential for development that are not in close proximity to the poles and wires proposed to be undergrounded, nor are they connected to the system to be undergrounded. Therefore, these properties are assigned 0 Aesthetic Benefits, 0 Safety Benefits and 0 Connection Benefits.



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5. Assessment No. 310. This parcel's preliminary assessment was calculated based on an incorrect lot area, which is less than what it actually should be. Spreading the assessments based on the correct lot area causes all other parcels to realize a 0.39% reduction in their assessment amounts, and the resultant $24,248 has been deducted proportionally from the construction and incidental contingencies and the financing costs, as can be seen in the cost estimate. Because no parcel's assessment may be increased above what it was noticed, Assessment No. 31 O's assessment remains at the amount that was shown in the Preliminary Engineer's Report. Therefore, neither Assessment No. 31 0 nor any other parcel within the Assessment District is paying more than its proportional share of the special benefits attributable to it from the improvements being constructed by this Assessment District.

ASSESSMENT APPORTIONMENT

Each parcel will be apportioned its fair share of the construction costs based on the Assessed Parcel Area calculated for each property.

Incidental Expenses and Financial Costs have been assessed to the entire Assessment District on a prorata basis relative to the total construction cost allocations.

The individual assessment calculations are provided in Appendix B. For particulars to the Assessment Roll, reference is made to Table 1 in Part III of this report.

In conclusion, it is my opinion that the assessments for the referenced Assessment District have been spread in direct accordance with the special benefits that each parcel receives from the works of improvement.

DATED: July 8, 2009

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HARRIS & ASSOCIATES

JOAN E COX, P.E. R.C.E. No. 41965 ASSESSMENT ENGINEER CITY OF NEWPORT BEACH COUNTY OF ORANGE, STATE OF CALIFORNIA

IIIII Harris & Associates


July 28, 2009

Page 23

I, k&tvtjr.l/ {. /?t<of'l ~ , as CITY CLERK of the CITY OF NEWPORT BEACH, CALIFORNIA do hereby certify that the foregoing~j;{ssment, together with the Diagram attached thereto, was filed in my office on the 2!12I!J day of , 2009.

c@kQ ~~ CITY CLERK ) CITY OF NEWPORT BEACH STATE OF CALIFORNIA

I, UlLMJ I / · ~~vJN as CITY CLERK of the CITY OF NEWPORT BEACH~ CALIFORNIA do hereby certify that the foregoing Assessment, together with the Diagram attached thereto, was preliminq~ approved.e City Council of the CITY OF NEWPORT BEACH~ CALIFORNIA, on the day of , 2009. Q

iiU jill- r!:a~ . Bnvrr--CITYCLERK J CITY OF NEWPORT BEACH STATE OF CALIFORNIA

I, UluJtN\ /. /1t.ori N , as CITY CLERK of the CITY OF NEWPORT BEACH, CALIFORNIA do hereby certify that the foregoing Assessment, together with the Diagram attached thereto, was approved and confirmed by the City Council of said City on the ~day of

Jliki-· 2009. ~ Q. ~~ CITY CLERK CITY OF NEWPORT BEACH STATE OF CALIFORNIA

I, 57~-<L A.et.?:M1 as SUPERINTENDENT OF STREETS of the CITY OF NEWPORT BEACH, CALlFORNIA do hereby certify that the fo~oing Assessment, together with the Diagram attached thereto, was recorded in my office on the27 day of Jut,y , 2009.

ENT OF STREETS CITY NEWPORT BEACH

E OF CALIFORNIA

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Part IV Annual Administrative Assessment

July 28, 2009

Page 24

A proposed maximum annual administrative assessment shall be levied on each parcel of land and subdivision of land within the Assessment District to pay for necessary costs and expenses incurred by the CITY OF NEWPORT BEACH, and not otherwise reimbursed, resulting from the administration and collection of assessments, from the administration or registration of any bonds and reserve or other related funds, or both. The maximum assessment is authorized pursuant to the provisions of Section 1 0204(f) of the Streets and Highways Code and shall not exceed fifty dollars ($50) per parcel per year, subject to an annual increase based on the Consumer Price Index (CPI), during the preceding year ending in January, for all Urban Consumers in the Los Angeles, Riverside, and Orange County areas. The exact amount of the administration charge will be established each year by the Superintendent of Streets.

The annual administrative assessment will be collected in the same manner and m the same installments as the assessment levied to pay for the cost of the works of improvement.



Part V Diagram of Assessment

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Page 25

A reduced copy of the Assessment Diagram is attached hereto. Full-sized copies of the Boundary Map and Assessment Diagram are on file in the Office of the City Clerk, of the City of Newport Beach.

As required by the Act, the Assessment Diagram shows the exterior boundaries of the Assessment District and the assessment number assigned to each parcel of land corresponding to its number as it appears in the Assessment Roll contained in Part III Table 1. The Assessor's Parcel Number is also shown for each parcel as they existed at the time of the passage of the Resolution of Intention and reference is hereby made to the Assessor's Parcel Maps of the County of Orange for the boundaries and dimensions of each parcel of land.

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(G Street/East Balboa Boulevard/Channel Rood/Ocean Boulevard) CITY OF NEWPORT BEACH, COUNTY OF ORANGE

STATE Of CALIFORNIA

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Q:\Newport Beach\AD I 03\reports\adl 03 final rpt 8ju109.doc

July 28, 2009

Page 31



Part VI Description of Facilities

July 28, 2009

Page 32

Section 1 01 00 of the Act provides for the legislative body of any municipality to finance certain capital facilities and services within or along its streets or any public way or easement. The following is a list of proposed improvements as allowed under the Act to be installed, or improved under the provisions of the Act, including the acquisition of required right-of-way and/or property. For the general location of the improvements to be constructed referenced is hereby made to the Plans and Specifications described in Part I of this report.

The following improvements are proposed to be constructed and installed in the general location referred to as Assessment District No. 103.

1. Removal of existing utility poles.

2. Removal of overhead resident service drops.

3. Construction of mainline underground power, telephone and cable conduit, with appurtenant manholes and pullboxes.

4. Construction of service conduit and appurtenances.

The improvements have been designed by the Southern California Edison Company, AT&T and Time Warner Cable. The City of Newport Beach will inspect the work to ensure conformance to City standards and specifications where applicable.

The City will also construct additional pavement rehabilitation as needed for the project.

Once completed, the underground facilities will become the property and responsibility of Southern California Edison Company, AT&T, and Time Warner Cable.

Each owner of property located within the Assessment District will be responsible for arranging for and paying for work on his or her property necessary to connect facilities constructed by the public utilities in the public streets and alleys to the points of connection on the private property. Conversion of individual service connections on private property is not included in the work done by the Assessment District.

The estimated time for completion of the undergrounding of the utilities is 36 months after the sale of bonds. Property owners will be required to provide necessary underground connections within 120 days of the completion of the underground facilities.

Failure to convert individual service connections on private property may result in a recommendation to the City Council that the public utilities be directed to discontinue service to that property pursuant to Section 15.32 of the Municipal Code. Overhead facilities cannot be removed until all overhead service has been discontinued.


City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St J E Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineers Report

STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF NEWPORT BEACH

Right .. of-Way Certificate

Page 33

The undersigned hereby CERTIFIES UNDER PENALTY OF PERJURY that the following is all true and correct.

That at all time herein mentioned, the undersigned was, and now is, the authorized representative of the duly appointed SUPERINTENDENT OF STREETS of the CITY OF NEWPORT BEACH, CALIFORNIA.

That there have now been instituted proceedings under the provisions of Article XIIID of the California Constitution, and the "Municipal Improvements Act of 1913," being Division 12 of the Streets and Highways Code of the State of California, for the construction of certain public improvements in a special assessment district known and designated as ASSESSMENT DISTRICT NO. 103 (hereinafter referred to as the 11Assessment District").

THE UNDERSIGNED STATES AND CERTIFIES AS FOLLOWS:

It is acknowledged that the proposed Works of Improvement must be located within public rights-ofway, land, or easements owned by or licensed to the CITY OF NEWPORT BEACH, County of Orange, State of California, at the time of the construction of the Works of Improvement, and the undersigned hereby further certifies that all rights-of-way necessary for the Works of Improvements will be obtained and in possession of the Cityt County, or State prior to construction by the CITY OF NEWPORT BEACH.

EXECUTED this 2/frr day of Jvt.--y California.

Q:\Newport Beach\:\!)]0J\reports\adl03 final rpt 8jul09.doc

, 2009, at CITY OF NEWPORT BEACH,

SUPERINTENDENT OF STREETS CITY OF NEWPORT BEACH State of California

H I Harris & Associates


Certificate of Completion of Environmental Proceedings

STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF NEWPORT BEACH

The undersigned, under penalty of perjury, CERTIFIES as follows:

July 28, 2009

Page 34

1. That I am the person who authorized to prepare and process all environmental documentation as needed as it relates to the formation of the special Assessment District being formed pursuant to the provisions of the "Municipal Improvement Act of 1913" being Division 12 of the Streets and Highways Code of the State of California, said special Assessment District known and designated as ASSESSMENT DISTRlCT NO. 103 (hereinafter referred to as the "Assessment District").

2. The specific environmental proceedings relating to this Assessment District that have been completed are as follows:

CEQA compliance review:

The proposed project is Categorically Exempt (Class 2) from the provisions of CEQA (replacement or reconstructions).

3. I do hereby certify that all environmental evaluation proceedings necessary for the formation of the Assessment District have been completed to my satisfaction, and that no further environmental proceedings are necessary.

EXECUTED this :22 7k day of _......;c);._e..t::..~y----' 2009, at CITY OF NEWPORT BEACH, California.

'l.o<L"g,lolll'"m, PE NEWPORT BEACH

TE OF CALIFORNIA

Q:\Newport Beach\AD10J\reports\adl03 final rpt 8jul09.doc II I Harris & Assodates


Excerpts from Assessment District No. 64

Final Engineer's Report dated June 1, 1995

Q:\Newport Beach\AD103\reports\adl03 final rpt 8jul09.doc

July 28, 2009

Appendix A


City of Newport Beach - Assessment District No. 64 (Channel Road) ENGINEER'S REPORT· January 26; 1995 Page 8

improvements will provide a higher level of service to each individual property 1 and as the aesthetic environment surrounding each property will improve) it is our recommendation that benefit be spread on a per parcel basis.

The properties in the District are separated into two types of benefit categories:

1. Properties receiving service and which are directly adjacent to the poles, guide-lines and overhead facilities which are proposed to be removed.

2. Properties located on the south-west side of Channel Road, directly across Channel Road from the public beaches, and identified on the Assessment Diagram as Assessment No.s 9 through 15 and No. 36 (APN 048-302-05 through 11 and APN 048-282-19). These properties are not served by the facilities proposed to be underground; however, these properties will receive an extraordinary increase in property value resulting from the removal of overhead electrical and communication facilities from between the fronts of the properties and the view of Newport Harbor.

Properties not located directly adjacent to the facilities to be underground and not directly across from the public beach receive only incidental benefit from the improvements, and are therefore not included in the District.

As discussed above, all properties in the District are zoned residentiaL We have therefore spread the assessment on a per parcel basis to each parcel in the District.

• An exception to this is Assessment No. 1 (APN 048·240-37) which previously underground the utilities along the property as a requirement of development. There is currently a power pole at the southeast corner of the property and a guide-line which extends approximately 11.5 feet in front of the property. Both of these would be removed as part of the District improvements. The undergrounding would affect 11.5 feet of the 83.5 feet of property frontage, or 13.48% of the frontage; therefore, the assessment for this property will be 13.48% of a standard parcel's assessment.

• In Category No. 2, the "view" parcels described above, a credit has been applied to each parcel to account for the future undergrounding of th~se parcels' utilities. These parcels are not having their utilities underground at this time, but they clearly receive a benefit based on view enhancement. Therefore, these parcels are given a credit which represents an estimate of the cost to underground their utility services in a future undergrounding assessment district. The credit has been calculated as follows:

The utility undergrounding construction cost for the proposed Assessment District (as provided by Southern California Edison Company and Pacific Bell Telephone Company) is divided by the total length of the undergrounding. This provides an average cost per foot of undergrounding.

$236,170 + 1,752 fl = $134.800 per ft

P:\WP51 DATA \REP'ORTS\COX\A DFORMM .NPU

City of Newport Beach • Assessment District No. 64 (Channel Road) ENGINEER'S REPORT- January 26, 1995 Page 9

This average cost per foot of undergrounding is then multiplied by the affective length of the future undergrounding for the Category No. 2 parcels, which calculates an estimated cost for the future undergrounding of utilities serving those parcels.

$134.800 per ft x 295.75 ft == $39,867.10

The utilities which serve the view parcels are located in an alley, in back of the parcels, and also serve parcels located on the other side of the alley which would benefit from the future undergrounding; therefore, the estimated future undergrounding cost is divided in half and then apportioned as a credit, on a per parcel basis, to the Category No. 2 parcels.

($39,867 .1 0 + 2) + 8 parcels == $2,491.70 credit per parcel

The public beaches, Assessment No.8 (APN 048-301-07) and No. 34 (APN 048-292-11), being City propeny, will not receive an assessment. However, the City is making a 50% contribution for the cost of the utility undergrounding adjacent to the two public beach parcels.

Incidental and Financial Costs have been assessed on a prorata basis relative to the construction cost allocation.

For particulars as to the assessment roll, reference is made to Exhibit II, in the Appendix.

A detailed itemization of improvement costs may be found in Part II of this report.

In conclusion, it is my opinion that the assessments for the referenced Assessment District have been spread in direct accordance with the benefits that each parcel receives from the works of improvement.

DATED: January 26, 1995.

P:\WP5l DATA\RE.I'OinS\COX\ADFORMM NPII

BSI CONSULTANTS, INC.

i,;~i A By: JEFFRE~tOOP~

R.C.E. No. 31572 ASSESSMENT ENGINEER CITY OF NEWPORT BEACH STATE OF CALIFORNIA

City of Newport Beach - Assessment District No. 64 (Channel Road) ENGINEER'S REPORT- June 1, 7995

1\10DIFICATIONS TO THE METHOD AND FORi\1ULA OF ASSESSMENT SPREAD

Page 9A

Based on input from the first public hearing, modifications to the method and formula of assessment spread are provided as follows:

• Three properties have already had their telephone lines underground. These specifically are Assessment No.s 1, 2 and 3 (APN 048-240-37, 048-301-11 and 048-301-10). Therefore, these parcels are given a 20% credit on their total assessment, as the cost of undergrounding the telephone facilities is approximately 20% of the total construction cost.

• The utility pole located adjacent to Assessment Parcel No. 35 (APN 048-292-11) was originally proposed to be removed. The Edison Company has been directed to leave this pole in place, thereby eliminating the benefit to this property. Therefore, the assessment on this property has been reduced to $0.00.

In conclusion, it is my opinion that the assessments for the referenced Assessment District have been spread in direct accordance with the benefits that each parcel receives from the works of improvement.

DATED: June 1, 1995.

P: \ WPSl DATA \R EPO RTS\COX\A D PINL64. N P 0

BSl CONSULT ANTS, INC.

By: JEFFR/((1~ R.C.E. No. 31572 ASSESSMENT ENGINEER CITY OF NEWPORT BEACH STATE OF CALIFORNIA

City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Appendix B - Page 1

Appendix B ·Assessment Calculations

Assessor's Parcel Assessed Total Confirmed

Property Asmt Parcel Size (sf) Benefit Parcel Construction Incidental Financial Total

Address No. Number Rounded Factor Area Costs Expenses Costs Assessment

1500 E OCEAN BLVD 1 048-201-47 4,300 1 4,300 $19,337.88 $1,323.88 $3,088.05 $23,749.81 1504 E OCEAN BLVD 2 048-201-46 3,500 1 3,500 $15,740.14 $1,077.57 $2,513.53 $19,331.24 1508 E OCEAN BLVD 3 048-201-41 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1512 E OCEAN BLVD 4 048-201-40 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1516 E OCEAN BLVD 5 048-201-39 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1520 E OCEAN BLVD 6 048-201-38 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1526 E OCEAN BLVD 7 048-201-37 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 1530E OCEAN BLVD 8 048-201-52 5,600 5,600 $25,184.22 $1,724.12 $4,021.64 $30,929.98 1536 E OCEAN BLVD 9 048-201-34 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 1540 E OCEAN BLVD 10 048-201-33 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1544 E OCEAN BLVD 11 048-201-32 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1548 E OCEAN BLVD 12 048-201-31 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1552 E OCEAN BLVD 13 048-201-30 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1556 E OCEAN BLVD 14 048-201-29 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1560 E OCEAN BLVD 15 048-201-44 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1564 E OCEAN BLVD 16 048-201-45 5,200 5,200 $23,385.35 $1,600.97 $3,734.38 $28,720.70 1574 E OCEAN BLVD 17 048-201-26 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1576 E OCEAN BLVD 18 048-201-25 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1580 E OCEAN BLVD 19 048-201-24 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1584 E OCEAN BLVD 20 048-201-23 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 1588 E OCEAN BLVD 21 048-201-22 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60

1501 MIRAMAR DR 22 048-201-48 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1505 MIRAMAR DR 23 048-201-51 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 1511 MIRAMAR DR 24 048-201-50 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 1513 MIRAMAR DR 25 048-201-02 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1517 MIRAMAR DR 26 048-201-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1 521 MIRAMAR DR 27 048-201-04 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03

--·~1525 MIRAMAR DR 28 048-201-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1529 MIRAMAR DR 29 048-201-06 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1533 MIRAMAR DR 30 048-201-07 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1537 MIRAMAR DR 31 048-201-08 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1541 MIRAMAR DR 32 048-201-09 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1547 MIRAMAR DR 33 048-201-10 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1551 MIRAMAR DR 34 048-201-11 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1553 MIRAMAR DR 35 048-201-12 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1557 MIRAMAR DR 36 048-201-13 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1561 MIRAMAR DR 37 048-201-14 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1565 MIRAMAR DR 38 048-201-15 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1569 MIRAMAR DR 39 048-201-16 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1573 MIRAMAR DR 40 048-201-17 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1577 MIRAMAR DR 41 048-201-18 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1581 MIRAMAR DR 42 048-201-19 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1585 MIRAMAR DR 43 048-201-20 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1589 MIRAMAR DR 44 048-201-21 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 1512 MIRAMAR DR 45 048-192-01 4,800 4,800 $21,586.47 $1,477.82 $3,447.12 $26,511.41 1520 MIRAMAR DR 46 048-192-02 3,500 3,500 $15,740.14 $1,077.57 $2,513.53 $19,331.24 1530 MIRAMAR DR 47 048-192-03 7,200 7,200 $32,379.71 $2,216.73 $5,170.68 $39,767.12 1532 MIRAMAR DR 48 048-192-04 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 1536 MIRAMAR DR 49 048-192-05 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 1540 MIRAMAR DR 50 048-192-06 4,200 4,200 $18,888.16 $1,293.09 $3,016.23 $23,197.48 1544 MIRAMAR DR 51 048-192-07 4,300 4,300 $19,337.88 $1,323.88 $3,088.05 $23,749.81 1550 MIRAMAR DR 52 048-192-08 4,500 4,500 $20,237.32 $1,385.45 $3,231.68 $24,854.45 1552 MIRAMAR DR 53 048-192-09 10,100 1 10,100 $45,421.62 $3,109.26 $7,253.17 $55,784.05

1501 E BALBOA BLVD 54 048-191-19 3,400 0.33 1,133 $5,095.31 $348.83 $813.66 $6,257.80 1505 E BALBOA BLVD 55 048-191-02 3,300 0.83 2,750 $12,367.25 $846.67 $1,974.91 $15,188.83 1509 E BALBOA BLVD 56 048-191-03 2,900 1 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1515 E BALBOA BLVD 57 048-191-04 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67

--1S17 E BALBOA BLVD 58 048-191-05 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67

Q:\Newport Beach\AD103\reports\ad103 final rpt 8jul09.doc






Address No. Number Rounded Factor Area Costs Expenses Costs Assessment 1603 E BALBOA BLVD 59 048-191-06 2,600 1 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1605 E BALBOA BLVD 60 048-191-07 2,700 1 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1609 E BALBOA BLVD 61 048-191-08 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1613 E BALBOA BLVD 62 048-191-09 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1617 E BALBOA BLVD 63 048-191-10 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1621 E BALBOA BLVD 64 048-191-11 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 1625 E BALBOA BLVD 65 930-504-15 1,700 1,700 $7,645.21 $523.39 $1,220.86 $9,389.46 1627 E BALBOA BLVD 66 930-504-16 1,700 1,700 $7,645.21 $523.39 $1,220.86 $9,389.46 1629 E BALBOA BLVD 67 930-504-17 1,700 1,700 $7,645.21 $523.39 $1,220.86 $9,389.46 1631 E BALBOA BLVD 68 930-504-18 1,700 1,700 $7,645.21 $523.39 $1,220.86 $9,389.46 1633 E BALBOA BLVD 69 048-191-14 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 1637 E BALBOA BLVD 70 048-191-15 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 1641 E BALBOA BLVD 71 048-191-16 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 1701 E BALBOA BLVD 72 048-221-01 3,400 3,400 $15,290.42 $1,046.79 $2,441.71 $18,778.92 1705 E BALBOA BLVD 73 048-221-02 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1709 E BALBOA BLVD 74 048-221-03 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1717 E BALBOA BLVD 75 048-221-28 5,300 5,300 $23,835.06 $1,631.76 $3,806.20 $29,273.02 1801 E BALBOA BLVD 76 048-221-06 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1805 E BALBOA BLVD 77 048-221-29 3,900 3,900 $17,539.01 $1,200.73 $2,800.79 $21,540.53 1813 E BALBOA BLVD 78 048-221-24 3,900 3,900 $17,539.01 $1,200.73 $2,800.79 $21,540.53 1817 E BALBOA BLVD 79 048-221-10 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1821 E BALBOA BLVD 80 048-221-11 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1903 E BALBOA BLVD 81 048-221-12 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1905 E BALBOA BLVD 82 048-221-13 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1911 E BALBOA BLVD 83 048-221-14 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64

1704 PLAZA DEL NORTE 84 048-221-34 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 1706 PLAZA DEL NORTE 85 048-221-35 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 1710 PLAZA DEL NORTE 86 048-221-22 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1714 PLAZA DEL NORTE 87 048-221-21 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1718 PLAZA DEL NORTE 88 048-221-20 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1724 PLAZA DEL NORTE 89 048-221-19 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03

1726 PLAZA DEL NORTE CIR 90 048-221-18 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1730 PLAZA DEL NORTE 91 048-221-33 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1734 PLAZA DEL NORTE 92 048-221-32 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1740 PLAZA DEL NORTE 93 048-221-31 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1744 PLAZA DEL NORTE 94 048-221-30 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1748 PLAZA DEL NORTE 95 048-221-26 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1752 PLAZA DEL NORTE 96 048-221-27 2,400 1 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71

City Median Park 97 048-220-01 12,500 0 0 $0.00 $0.00 $0.00 $0.00 1703 PLAZA DEL SUR 98 048-222-01 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 1707 PLAZA DEL SUR 99 048-222-02 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1711 PLAZA DEL SUR 100 048-222-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1715 PLAZA DEL SUR 101 048-222-04 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1719 PLAZA DEL SUR 102 048-222-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1723 PLAZA DEL SUR 103 048-222-06 2,500 2,500 $11 ,242.95 $769.70 $1,795.38 $13,808.03

----~------ ..

1725 PLAZA DEL SUR 104 048-222-07 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 -··-1731 PLAZA DEL SUR 105 048-222-08 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03

1735 PLAZA DEL SUR 106 048-222-09 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1737 PLAZA DEL SUR 107 048-222-10 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1741 PLAZA DEL SUR 108 048-222-11 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1747 PLAZA DEL SUR 109 048-222-32 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1751 PLAZA DEL SUR 110 048-222-33 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1753 PLAZA DEL SUR 111 048-222-34 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1755 PLAZA DEL SUR 112 048-222-35 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67

1700 MIRAMAR DR 113 048-222-27 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 1706 MIRAMAR DR 114 048-222-26 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1710 MIRAMAR DR 115 048-222-25 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1714 MIRAMAR DR 116 048-222-24 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99






Address No. Number Rounded Factor Area Costs Expenses Costs Assessment 1718 MIRAMAR DR 117 048-222-23 2,900 1 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 1722 MIRAMAR DR 118 048-222-22 3,000 1 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 1726 MIRAMAR DR 119 048-222-21 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 1730 MIRAMAR DR 120 048-222-20 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 1734 MIRAMAR DR 121 048-222-19 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 1738 MIRAMAR DR 122 048-222-31 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 1742 MIRAMAR DR 123 048-222-30 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 1744 MIRAMAR DR 124 048-222-28 3,400 3,400 $15,290.42 $1,046.79 $2,441.71 $18,778.92 1750 MIRAMAR DR 125 048-222-29 3,400 3,400 $15,290.42 $1,046.79 $2,441.71 $18,778.92 1752 MIRAMAR DR 126 048-222-16 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 1756 MIRAMAR DR 127 048-222-37 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 1764 MIRAMAR DR 128 048-222-36 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 1701 MIRAMAR DR 129 048-211-36 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 1707 MIRAMAR DR 130 048-211-35 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1711 MIRAMAR DR 131 048-211-34 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1713 MIRAMAR DR 132 048-211-02 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1717 MIRAMAR DR 133 048-211-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1721 MIRAMAR DR 134 048-211-37 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1723 MIRAMAR DR 135 048-211-38 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1731 MIRAMAR DR 136 048-211-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1733 MIRAMAR DR 137 048-211-06 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1739 MIRAMAR DR 138 048-211-27 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1743 MIRAMAR DR 139 048-211-28 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1747 MIRAMAR DR 140 048-211-08 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1751 MIRAMAR DR 141 048-211-09 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1755 MIRAMAR DR 142 048-211-10 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1759 MIRAMAR DR 143 048-211-11 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 1761 MIRAMAR DR 144 048-211-12 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71

1700 E OCEAN BLVD 145 048-211-39 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 1706 E OCEAN BLVD 146 048-211-40 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1708 E OCEAN BLVD 147 048-211-23 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1714 E OCEAN BLVD 148 048-211-22 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1718 E OCEAN BLVD 149 048-211-21 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1720 E OCEAN BLVD 150 048-211-20 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1726 E OCEAN BLVD 151 048-211-19 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1730 E OCEAN BLVD 152 048-211-18 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1732 E OCEAN BLVD 153 048-211-17 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1738 E OCEAN BLVD 154 048-211-30 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1740 E OCEAN BLVD 155 048-211-32 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1746 E OCEAN BLVD 156 048-211-31 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1750 E OCEAN BLVD 157 048-211-25 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1754 E OCEAN BLVD 158 048-211-15 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1756 E OCEAN BLVD 159 048-211-14 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 1760 E OCEAN BLVD 160 048-211-13 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2000 E OCEAN BLVD 161 048-261-30 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 2004 E OCEAN BLVD 162 048-261-29 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2008 E OCEAN BLVD 163 048-261-28 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2012 E OCEAN BLVD 164 048-261-33 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2016 E OCEAN BLVD 165 048-261-34 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2020 E OCEAN BLVD 166 048-261-31 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2024 E OCEAN BLVD 167 048-261-32 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2028 E OCEAN BLVD 168 048-261-25 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2032 E OCEAN BLVD 169 048-261-24 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34

---2036 E OCEAN BLVD 170 048-261-23 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2040 E OCEAN BLVD 171 048-261-22 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2044 E OCEAN BLVD 172 048-261-21 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2050 E OCEAN BLVD 173 048-261-20 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2052 E OCEAN BLVD 174 048-261-19 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34

Q:\Newport Beach\AD 1 03\reports\ad 103 final rpt 8jul09.doc

II I Harris & Associates

City of Newport Beach July 28, 2009 Underground Utility Assessment District No.103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Appendix B - Page 4




Address No. Number Rounded Factor Area Costs Expenses Costs Assessment 2056 E OCEAN BLVD 175 048-261-18 2,600 1 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2060 E OCEAN BLVD 176 048-261-17 3,200 1 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 2001 MIRAMAR DR 177 048-261-01 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2005 MIRAMAR DR 178 048-261-02 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2007 MIRAMAR DR 179 048-261-03 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2009 MIRAMAR DR 180 048-261-04 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2011 MIRAMAR DR 181 048-261-05 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2013 MIRAMAR DR 182 048-261-06 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2015 MIRAMAR DR 183 048-261-07 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2017 MIRAMAR DR 184 048-261-08 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 2021 MIRAMAR DR 185 048-261-09 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 2023 MIRAMAR DR 186 048-261-35 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2025 MIRAMAR DR 187 048-261-36 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2027 MIRAMAR DR 188 048-261-11 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2029 MIRAMAR DR 189 048-261-12 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2031 MIRAMAR DR 190 048-261-13 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2033 MIRAMAR DR 191 048-261-14 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2035 MIRAMAR DR 192 048-261-15 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2037 MIRAMAR DR 193 048-261-16 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2000 MIRAMAR DR 194 048-252-12 6,000 6,000 $26,983.09 $1,847.27 $4,308.90 $33,139.26

306 L ST 195 048-252-11 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 308 L ST 196 048-252-10 2,300 2,300 $10,343.52 $708.12 $1 ,651.75 $12,703.39 314 L ST 197 048-252-15 7,000 7,000 $31,480.27 $2,155.15 $5,027.05 $38,662.47 318 L ST 198 048-252-14 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 322 L ST 199 048-252-13 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 324 L ST 200 048-252-19 1,400 1,400 $6,296.05 $431.03 $1,005.41 $7,732.49 326 L ST 201 048-252-18 1,400 1,400 $6,296.05 $431.03 $1,005.41 $7,732.49 330 L ST 202 048-252-05 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 332 L ST 203 048-252-21 1,800 1,800 $8,094.93 $554.18 $1,292.67 $9,941.78 334 L ST 204 048-252-20 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 338 L ST 205 048-252-03 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 340 L ST 206 048-252-02 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74

~OT E BALBOA BLVD 207 048-252-17 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2005 E BALBOA BLVD 208 048-252-16 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34

429 BELVUE LN 209 048-251-21 5,000 5,000 $22,485.91 $1,539.39 $3,590.75 $27,616.05 427 BELVUE LN 210 048-251-22 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 425 BELVUE LN 211 048-251-23 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 423 BELVUE LN 212 048-251-24 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 421 BELVUE LN 213 048-251-25 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 419 BELVUE LN 214 048-251-26 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 417 BELVUE LN 215 048-251-27 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 415 BELVUE LN 216 048-251-28 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 413 BELVUE LN 217 048-251-29 4,000 4,000 $17,988.~3 $1,231.51 $2,872.60 $22,092.84 411 BELVUE LN 218 048-251-30 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 409 BELVUE LN 219 048-251-31 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 407 BELVUE LN 220 048-251-32 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 405 BELVUE LN 221 048-251-33 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 403 BELVUE LN 222 048-251-07 4,000 1 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 401 BELVUE LN 223 048-251-06 6,100 0.83 5,083 $22,859.18 $1,564.95 $3,650.36 $28,074.49 450 BELVUE LN 224 048-251-37 5,800 5,800 $26,083.65 $1,785.70 $4,165.27 $32,034.62 426 BELVUE LN 225 048-251-38 5,200 5,200 $23,385.35 $1,600.97 $3,734.38 $28,720.70 424 BELVUE LN 226 048-251-34 5,000 5,000 $22,485.91 $1,539.39 $3,590.75 $27,616.05 422 BELVUE LN 227 048-251-35 5,000 5,000 $22,485.91 $1,539.39 $3,590.75 $27,616.05 420 BELVUE LN 228 048-251-14 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 418 BELVUE LN 229 048-251-15 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 416 BELVUE LN 230 048-251-16 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 414 BELVUE LN 231 048-251-17 4,000 4,000 $17,988.73 $1,231.51 $?,872.60 $22,092.84 412 BELVUE LN 232 048-251-18 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84


City of Newport Beach July 28, 2009 Underground Utility Assessment District No.103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Appendix B - Page 5




Address No. Number Rounded Factor Area Costs Expenses Costs Assessment 410 BELVUE LN 233 048-251-19 4,000 1 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 408 BELVUE LN 234 048-251-20 4,000 1 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 406 BELVUE LN 235 048-251-02 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 404 BELVUE LN 236 048-251-03 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 402 BELVUE LN 237 048-251-04 4,000 1 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 400 BELVUE LN 238 048-251-05 5,200 0.83 4,333 $19,486.29 $1,334.04 $3,111.74 $23,932.07

2025 E BALBOA BLVD 239 048-272-28 3,200 1 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27 2031 E BALBOA BLVD 240 048-272-29 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27

445 SEVILLE AVE 241 048-272-20 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 441 SEVILLE AVE 242 048-272-19 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 437 SEVILLE AVE 243 048-272-31 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 433 SEVILLE AVE 244 048-272-30 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 429 SEVILLE AVE 245 048-272-04 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 425 SEVILLE AVE 246 048-272-05 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 421 SEVILLE AVE 247 048-272-24 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 417 SEVILLE AVE 248 048-272-32 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 413 SEVILLE AVE 249 048-272-33 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 409 SEVILLE AVE 250 048-272-22 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 405 SEVILLE AVE 251 048-272-26 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 401 SEVILLE AVE 252 048-272-27 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99

-------·39·9 SEVILLE AVE 253 048-272-21 9,400 9,400 $42,273.51 $2,894.06 $6,750.61 $51,918.18 2033 SEVILLE ST 254 048-272-09 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03

2037 SEVILLE AVE 255 048-272-10 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2039 SEVILLE AVE 256 048-272-11 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2043 SEVILLE AVE 257 048-272-12 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71

..

2022 MIRAMAR DR 258 048-272-18 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 2026 MIRAMAR DR 259 048-272-17 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2032 MIRAMAR DR 260 048-272-16 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2034 MIRAMAR DR 261 048-272-15 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2038 MIRAMAR DR 262 048-272-14 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2042 MIRAMAR DR 263 048-272-13 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 448 SEVILLE AVE 264 048-271-30 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99

·2o3iE BALBOA BLVD 265 048-271-29 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 444 SEVILLE AVE 266 048-271-17 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 440 SEVILLE AVE 267 048-271-28 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 436 SEVILLE AVE 268 048-271-26 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 432 SEVILLE AVE 269 048-271-25 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 424 SEVILLE AVE 270 048-271-27 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 420 SEVILLE AVE 271 048-271-14 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 416 SEVILLE AVE 272 048-271-13 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 412 SEVILLE AVE 273 048-271-21 3,700 3,700 $16,639.57 $1,139.15 $2,657.16 $20,435.88 408 SEVILLE AVE 274 048-271-23 2,300 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39 402 SEVILLE AVE 275 048-271-31 3,200 0.83 2,667 $11,993.98 $821.11 $1,915.31 $14,730.40

2041 E BALBOA BLVD 276 048-271-19 2,800 1 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 449 M ST 277 048-271-01 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 445 M ST 278 048-271-02 4,900 4,900 $22,036.19 $1,508.60 $3,518.94 $27,063.73 441 M ST 279 048-271-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 433 M ST 280 048-271-32 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 429 M ST 281 048-271-33 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 425 M ST 282 048-271-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 421 M ST 283 048-271-06 4,900 4,900 $22,036.19 $1,508.60 $3,518.94 $27,063.73 409 M ST 284 048-271-07 4,700 1

---~----

4,700 $21,136.75 $1,447.03 $3,375.31 $25,959.09 405 M ST 285 048-271-08 2,300 1 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39

2046 SEVILLE AVE 286 048-271-09 3,600 0.33 1,200 $5,396.62 $369.45 $861.78 $6,627.85 2101 E BALBOA BLVD 287 048-302-01 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 2105 E BALBOA BLVD 288 048-302-02 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2109 E BALBOA BLVD 289 048-302-03 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2115 E BALBOA BLVD 290 048-302-04 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64

Q:\Newport Beach\ADI03\reports\adl03 final rpt 8jul09.doc HI Harris & Associates


Appendix B -Assessment Calculations



Address No. Number Rounded Factor Area Costs Expenses Costs Assessment

2117 E BALBOA BLVD 291 048-302-05 3,000 1 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2123 E BALBOA BLVD 292 048-302-06 3,000 1 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2125 E BALBOA BLVD 293 048-302-07 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2129 E BALBOA BLVD 294 048-302-08 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64

2133 CHANNEL RD 295 048-302-09 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2137 CHANNEL RD 296 048-302-10 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64

2140 GRANADA AVE 297 048-302-11 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 2100 SERRANO AVE 298 048-302-17 4,000 4,000 $17,988.73 $1,231.51 $2,872.60 $22,092.84 2102 SERRANO AVE 299 048-302-16 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60

--2106 SERRANO AVE 300 048-302-15 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 21·1·0 SERRANO AVE 301 048-302-14 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 2114 SERRANO AVE 302 048-302-13 3,300 1 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 2118 SERRANO AVE 303 048-302-12 3,800 1 3,800 $17,089.29 $1,169.94 $2,728.97 $20,988.20

City Median Park 304 048-290-01 2,600 0 0 $0.00 $0.00 $0.00 $0.00 2101 GRANADA AVE 305 048-291-01 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 2103 GRANADA AVE 306 048-291-02 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 2107 GRANADA AVE 307 048-291-22 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 2111 GRANADA AVE 308 048-291-23 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2117 GRANADA AVE 309 048-291-20 3,600 3,600 $16,189.85 $1 '1 08.36 $2,585.34 $19,883.55 2123 GRANADA AVE 310 048-291-26 6,900 6,900 $11,286.88 $772.70 $1,802.39 $13,861.97 2100 SEVILLE AVE 311 048-291-19 2,400 2,400 $10,793.24 $738.91 $1,723.56 $13,255.71 2104 SEVILLE AVE 312 048-291-18 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2110 SEVILLE AVE 313 048-291-17 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2112 SEVILLE AVE 314 048-291-24 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2118 SEVILLE AVE 315 048-291-25 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2120 SEVILLE AVE 316 048-291-15 2,500 2,500 $11 ,242.95 $769.70 $1,795.38 $13,808.03 2124 SEVILLE AVE 317 048-291-14 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2128 SEVILLE AVE 318 048-291-13 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2132 SEVILLE AVE 319 048-291-12 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 2201 CHANNEL RD 320 048-291-06 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2205 CHANNEL RD 321 048-291-07 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 2209 CHANNEL RD 322 048-291-08 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 2213 CHANNEL RD 323 048-291-09 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 2217 CHANNEL RD 324 048-291-10 2,800 2,800 $12,592.11 $862.06 $2,010.82 $15,464.99 2219 CHANNEL RD 325 048-291-11 3,300 0.50 1,650 $7,420.35 $508.00 $1 '184.95 $9,113.30 2101 SEVILLE AVE 326 048-292-28 2,900 2,900 $13,041.83 $892.85 $2,082.64 $16,017.32 2105 SEVILLE AVE 327 048-292-29 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2109 SEVILLE AVE 328 048-292-02 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2113 SEVILLE AVE 329 048-292-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2117 SEVILLE AVE 330 048-292-04 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2121 SEVILLE AVE 331 048-292-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2127 SEVILLE AVE 332 048-292-06 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2129 SEVILLE AVE 333 048-292-07 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2133 SEVILLE AVE 334 048-292-27 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 2137 SEVILLE AVE 335 048-292-26 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 2141 SEVILLE AVE 336 048-292-32 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 2145 SEVILLE AVE 337 048-292-33 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 2149 SEVILLE AVE 338 048-292-10 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2100 MIRAMAR DR 339 048-292-25 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2104 MIRAMAR DR 340 048-292-24 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2108 MIRAMAR DR 341 048-292-23 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2112 MIRAMAR DR 342 048-292-22 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2116 MIRAMAR DR 343 048-292-21 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03

--2120 MIRAMAR DR 344 048-292-20 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2124 MIRAMAR DR 345 048-292-19 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2126 MIRAMAR DR 346 048-292-18 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,_598 74 2128 MIRAMAR DR 347 048-292-17 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74 2130 MIRAMAR DR 348 048-292-35 2,100 2,100 $9,444.08 $646.54 $1,508.12 $11,598.74


City of Newport Beach July 28, 2009 Underground Utility Assessment District No. 103 (G St IE Balboa Blvd I Channel Rd I Ocean Blvd) Final Engineer's Report Appendix B- Page 7

Appendix B- Assessment Calculations



Address No. Number Rounded Factor Area Costs Expenses Costs Assessment 2134 MIRAMAR DR 349 048-292-34 2,500 1 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2136 MIRAMAR DR 350 048-292-15 2,300 1 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39 2142 MIRAMAR DR 351 048-292-14 2,300 1 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39 2146 MIRAMAR DR 352 048-292-13 2,300 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39 2150 MIRAMAR DR 353 048-292-12 2,300 1 2,300 $10,343.52 $708.12 $1,651.75 $12,703.39 2265 CHANNEL RD 354 048-292-11 2,600 0.83 2,167 $9,745.39 $667.17 $1,556.23 $11,968.79 2101 MIRAMAR DR 355 048-281-01 3,000 1 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2105 MIRAMAR DR 356 048-281-02 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2109 MIRAMAR DR 357 048-281-03 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2113 MIRAMAR DR 358 048-281-04 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2117 MIRAMAR DR 359 048-281-05 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2121 MIRAMAR DR 360 048-281-06 2,500 2,500 $11,242.95 $769.70 $1,795.38 $13,808.03 2125 MIRAMAR DR 361 048-281-31 2,200 2,200 $9,893.80 $677.33 $1,579.93 $12,151.06 2129 MIRAMAR DR 362 048-281-36 2,700 2,700 $12,142.39 $831.27 $1,939.01 $14,912.67 2133 MIRAMAR DR 363 048-281-35 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2137 MIRAMAR DR 364 048-281-09 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2141 MIRAMAR DR 365 048-281-10 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2145 MIRAMAR DR 366 048-281-11 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2149 MIRAMAR DR 367 048-281-12 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2155 MIRAMAR DR 368 048-281-13 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2157 MIRAMAR DR 369 048-281-37 _3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64 2161 MIRAMAR DR 370 048-281-38 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95

2100 E OCEAN BLVD 371 048-281-30 3,200 3,200 $14,390.98 $985.21 $2,298.08 $17,674.27

2104 E OCEAN BLVD 372 048-281-29 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2110 E OCEAN BLVD 373 048-281-28 2,600 2,600 $11 ,692.67 $800.48 $1,867.19 $14,360.34 2112E OCEAN BLVD 374 048-281-27 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2118 E OCEAN BLVD 375 048-281-26 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2120 E OCEAN BLVD 376 048-281-25 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34

2124 E OCEAN BLVD 377 048-281-24 2,600 2,600 $11,692.67 $800.48 $1,867.19 $14,360.34 2128 E OCEAN BLVD 378 048-281-39 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60

2132 E OCEAN BLVD 379 048-281-21 3,300 3,300 $14,840.70 $1,016.00 $2,369.90 $18,226.60 2140 E OCEAN BLVD 380 048-281-20 3,100 3,100 $13,941.26 $954.42 $2,226.27 $17,121.95 2144 E OCEAN BLVD 381 048-281-19 4,700 4,700 $21,136.75 $1,447.03 $3,375.31 $25,959.09

2152 E OCEAN BLVD 382 048-281-18 4,300 4,300 $19,337.88 $1,323.88 $3,088.05 $23,749.81 2156 E OCEAN BLVD 383 048-281-33 3,000 3,000 $13,491.55 $923.64 $2,154.45 $16,569.64

2160 E OCEAN BLVD 384 048-281-34 3,600 3,600 $16,189.85 $1,108.36 $2,585.34 $19,883.55 2164 E OCEAN BLVD 385 048-281-16 3,800 3,800 $17,089.29 $1 '169.94 $2,728.97 $20,988.20 2291 CHANNEL RD 386 048-281-15 4,500 4,500 $20,237.32 $1,385.45 $3,231.68 $24,854.45

1 '130,683 $5,065,143.00 $346,761.00 $808,848.00 $6,220,752.00

Q:\Newport Beach\AD103\reports\ad103 final rpt 8jul09.doc


H-1

APPENDIX H

LIST OF UNPAID ASSESSMENTS

Assessed Value (AV)Tax Roll as of July 2009

AssessmentNo. APN Land Value

StructureValue Total Value

ConfirmedAssessment

Value-to-LienRatio for

ConfirmedAssessment

1 048-201-47 $1,662,524 $618,029 $2,280,553 $22,384.20 101.88:12 048-201-46 623,617 409,641 1,033,258 18,219.69 56.71:13 048-201-41 57,122 33,893 91,015 15,096.32 6.03:14 048-201-40 283,462 62,443 345,905 15,096.32 22.91:15 048-201-39 789,572 147,825 937,397 15,096.32 62.09:16 048-201-38 409,685 65,470 475,155 15,096.32 31.47:17 048-201-37 1,451,249 64,155 1,515,404 14,575.75 103.97:18 048-201-52 1,537,016 309,351 1,846,367 29,151.51 63.34:19 048-201-34 1,493,875 41,125 1,535,000 14,575.75 105.31:111 048-201-32 57,122 12,013 69,135 14,055.19 4.92:112 048-201-31 927,281 51,198 978,479 14,055.19 69.62:113 048-201-30 334,887 71,542 406,429 14,055.19 28.92:115 048-201-44 404,708 44,169 448,877 14,055.19 31.94:117 048-201-26 596,953 48,267 645,220 13,534.62 47.67:118 048-201-25 286,771 113,271 400,042 13,534.62 29.56:119 048-201-24 298,277 39,177 337,454 13,534.62 24.93:120 048-201-23 97,095 183,832 280,927 15,616.89 17.99:121 048-201-22 511,648 165,452 677,100 17,178.57 39.42:122 048-201-48 819,704 361,222 1,180,926 15,096.32 78.23:126 048-201-03 57,126 38,886 96,012 13,014.07 7.38:127 048-201-04 651,416 36,894 688,310 13,014.07 52.89:128 048-201-05 820,599 211,565 1,032,164 13,014.07 79.31:130 048-201-07 665,746 135,746 801,492 13,014.07 61.59:132 048-201-09 792,038 43,431 835,469 13,014.07 64.20:133 048-201-10 846,228 0 846,228 13,014.07 65.02:134 048-201-11 456,943 191,950 648,893 13,014.07 49.86:135 048-201-12 242,236 75,037 317,273 13,014.07 24.38:137 048-201-14 696,802 62,050 758,852 13,014.07 58.31:138 048-201-15 57,123 37,338 94,461 13,014.07 7.26:141 048-201-18 424,657 75,511 500,168 13,014.07 38.43:143 048-201-20 275,703 183,792 459,495 13,014.07 35.31:144 048-201-21 57,127 28,191 85,318 16,137.44 5.29:145 048-192-01 79,922 215,973 295,895 24,987.01 11.84:146 048-192-02 66,690 35,020 101,710 18,219.69 5.58:147 048-192-03 251,183 172,071 423,254 37,480.51 11.29:1

H-2




ConfirmedAssessment


ConfirmedAssessment

48 048-192-04 $1,734,000 $102,000 $1,836,000 $20,822.50 88.17:149 048-192-05 514,563 124,008 638,571 20,822.50 30.67:150 048-192-06 1,017,827 140,829 1,158,656 21,863.63 52.99:152 048-192-08 740,526 111,652 852,178 23,425.32 36.38:153 048-192-09 1,616,511 236,195 1,852,706 52,576.64 35.24:154 048-191-19 128,110 118,055 246,165 5,897.98 41.74:155 048-191-02 322,508 190,128 512,636 14,315.47 35.81:156 048-191-03 435,706 84,476 520,182 15,096.32 34.46:157 048-191-04 797,735 37,734 835,469 14,055.19 59.44:158 048-191-05 73,557 25,098 98,655 14,055.19 7.02:159 048-191-06 1,452,382 77,006 1,529,388 13,534.62 113.00:161 048-191-08 167,812 53,044 220,856 13,534.62 16.32:164 048-191-11 57,127 58,235 115,362 16,658.00 6.93:165 930-504-15 627,577 113,593 741,170 8,849.56 83.75:167 930-504-17 876,626 126,374 1,003,000 8,849.56 113.34:168 930-504-18 649,632 121,112 770,744 8,849.56 87.09:169 048-191-14 995,571 70,637 1,066,208 17,178.57 62.07:170 048-191-15 398,967 235,027 633,994 15,616.89 40.60:172 048-221-01 684,443 1,029,996 1,714,439 17,699.13 96.87:173 048-221-02 57,125 31,075 88,200 13,534.62 6.52:174 048-221-03 246,771 98,103 344,874 13,534.62 25.48:177 048-221-29 72,319 40,994 113,313 20,301.95 5.58:178 048-221-24 1,383,000 265,000 1,648,000 20,301.95 81.17:181 048-221-12 303,593 36,011 339,604 13,534.62 25.09:183 048-221-14 398,952 147,295 546,247 15,616.89 34.98:185 048-221-35 1,258,649 41,351 1,300,000 12,493.51 104.05:186 048-221-22 57,124 30,984 88,108 13,014.07 6.77:191 048-221-33 600,719 234,017 834,736 13,014.07 64.14:194 048-221-30 57,124 116,917 174,041 13,014.07 13.37:195 048-221-26 403,555 49,074 452,629 13,014.07 34.78:199 048-222-02 128,117 69,071 197,188 13,014.07 15.15:1

100 048-222-03 463,435 198,219 661,654 13,014.07 50.84:1101 048-222-04 1,794,794 347,206 2,142,000 13,014.07 164.59:1102 048-222-05 1,244,226 102,774 1,347,000 13,014.07 103.50:1103 048-222-06 405,331 186,181 591,512 13,014.07 45.45:1105 048-222-08 684,371 194,051 878,422 13,014.07 67.50:1112 048-222-35 2,869,056 600,944 3,470,000 14,055.19 246.88:1113 048-222-27 57,124 51,495 108,619 14,575.75 7.45:1

H-3




ConfirmedAssessment


ConfirmedAssessment

114 048-222-26 $820,945 $61,670 $882,615 $13,534.62 65.21:1115 048-222-25 1,748,230 51,770 1,800,000 14,055.19 128.07:1116 048-222-24 939,258 462,742 1,402,000 14,575.75 96.19:1117 048-222-23 57,125 29,180 86,305 15,096.32 5.72:1120 048-222-20 57,119 35,301 92,420 16,137.44 5.73:1122 048-222-31 57,127 27,486 84,613 17,178.57 4.93:1123 048-222-30 125,590 49,654 175,244 17,178.57 10.20:1125 048-222-29 568,933 131,133 700,066 17,699.13 39.55:1127 048-222-37 1,772,711 77,289 1,850,000 16,137.44 114.64:1128 048-222-36 367,200 292,631 659,831 17,178.57 38.41:1130 048-211-35 637,658 50,172 687,830 13,014.07 52.85:1133 048-211-03 1,200,067 37,093 1,237,160 13,014.07 95.06:1136 048-211-05 57,125 39,307 96,432 13,014.07 7.41:1143 048-211-11 483,617 41,252 524,869 13,014.07 40.33:1145 048-211-39 1,683,938 135,062 1,819,000 15,616.89 116.48:1147 048-211-23 1,543,014 48,798 1,591,812 13,534.62 117.61:1149 048-211-21 1,320,422 62,578 1,383,000 13,534.62 102.18:1151 048-211-19 57,127 33,823 90,950 13,534.62 6.72:1152 048-211-18 57,125 161,079 218,204 13,534.62 16.12:1153 048-211-17 57,120 88,043 145,163 13,534.62 10.73:1154 048-211-30 57,119 266,337 323,456 12,462.12 25.96:1155 048-211-32 57,124 57,679 114,803 13,534.62 8.48:1156 048-211-31 335,001 67,069 402,070 13,534.62 29.71:1157 048-211-25 667,144 36,000 703,144 13,534.62 51.95:1158 048-211-15 1,376,663 52,337 1,429,000 13,534.62 105.58:1167 048-261-32 312,263 73,866 386,129 13,534.62 28.53:1168 048-261-25 57,122 33,474 90,596 13,534.62 6.69:1169 048-261-24 814,011 353,219 1,167,230 13,534.62 86.24:1171 048-261-22 57,126 29,532 86,658 13,534.62 6.40:1174 048-261-19 57,122 24,047 81,169 13,534.62 6.00:1176 048-261-17 60,923 135,764 196,687 16,658.00 11.81:1177 048-261-01 709,902 58,433 768,335 15,616.89 49.20:1180 048-261-04 1,878,814 171,186 2,050,000 10,931.81 187.53:1181 048-261-05 471,976 432,972 904,948 10,931.81 82.78:1182 048-261-06 1,993,329 240,671 2,234,000 10,931.81 204.36:1183 048-261-07 53,319 24,959 78,278 10,931.81 7.16:1188 048-261-11 398,286 41,896 440,182 10,931.81 40.27:1190 048-261-13 784,857 66,354 851,211 10,931.81 77.87:1

H-4




ConfirmedAssessment


ConfirmedAssessment

191 048-261-14 $2,327,692 $406,308 $2,734,000 $10,931.81 250.10:1192 048-261-15 497,922 300,807 798,729 10,931.81 73.06:1194 048-252-12 1,183,881 134,116 1,317,997 31,233.76 42.20:1195 048-252-11 1,002,301 550,759 1,553,060 12,493.51 124.31:1196 048-252-10 118,050 35,088 153,138 11,972.94 12.79:1197 048-252-15 110,533 83,950 194,483 20,351.88 9.56:1202 048-252-05 76,123 27,773 103,896 14,575.75 7.13:1204 048-252-20 1,311,094 302,906 1,614,000 10,931.81 147.64:1205 048-252-03 68,520 29,180 97,700 16,658.00 5.87:1209 048-251-21 72,324 28,750 101,074 26,028.13 3.88:1212 048-251-24 57,121 419,339 476,460 20,822.50 22.88:1213 048-251-25 1,098,392 50,608 1,149,000 20,822.50 55.18:1214 048-251-26 2,084,764 0 2,084,764 20,822.50 100.12:1215 048-251-27 1,669,164 388,836 2,058,000 20,822.50 98.84:1216 048-251-28 57,127 37,122 94,249 20,822.50 4.53:1217 048-251-29 57,123 24,675 81,798 20,822.50 3.93:1218 048-251-30 348,388 360,035 708,423 20,822.50 34.02:1221 048-251-33 57,122 25,235 82,357 18,577.93 4.43:1224 048-251-37 1,192,093 505,407 1,697,500 30,192.63 56.22:1225 048-251-38 835,475 463,093 1,298,568 27,069.26 47.97:1226 048-251-34 361,573 66,387 427,960 26,028.13 16.44:1227 048-251-35 360,998 250,009 611,007 26,028.13 23.47:1231 048-251-17 57,127 136,953 194,080 20,822.50 9.32:1232 048-251-18 93,357 104,731 198,088 20,822.50 9.51:1233 048-251-19 788,650 47,991 836,641 20,822.50 40.18:1234 048-251-20 978,333 477,452 1,455,785 20,822.50 69.91:1237 048-251-04 837,168 139,196 976,364 20,822.50 46.89:1239 048-272-28 1,403,406 296,594 1,700,000 16,658.00 102.05:1241 048-272-20 598,277 387,486 985,763 14,575.75 67.63:1242 048-272-19 2,529,948 870,052 3,400,000 14,575.75 233.26:1246 048-272-05 477,782 90,760 568,542 14,575.75 39.01:1248 048-272-32 536,197 88,089 624,286 14,575.75 42.83:1249 048-272-33 339,680 85,586 425,266 14,575.75 29.18:1250 048-272-22 379,629 84,898 464,527 14,575.75 31.87:1251 048-272-26 409,986 127,577 537,563 14,575.75 36.88:1252 048-272-27 57,122 35,228 92,350 14,575.75 6.34:1

H-5




ConfirmedAssessment


ConfirmedAssessment

253 048-272-21 $546,555 $581,158 $1,127,713 $48,932.89 23.05:1254 048-272-09 438,002 67,436 505,438 13,014.07 38.84:1255 048-272-10 1,084,047 44,953 1,129,000 13,014.07 86.75:1256 048-272-11 57,123 56,124 113,247 13,014.07 8.70:1258 048-272-18 527,750 246,363 774,113 15,096.32 51.28:1259 048-272-17 937,168 214,864 1,152,032 13,014.07 88.52:1260 048-272-16 1,940,869 87,131 2,028,000 13,014.07 155.83:1262 048-272-14 1,104,188 494,190 1,598,378 13,014.07 122.82:1265 048-271-29 1,315,477 48,523 1,364,000 14,575.75 93.58:1267 048-271-28 148,939 39,384 188,323 16,137.44 11.67:1268 048-271-26 60,922 31,643 92,565 16,137.44 5.74:1269 048-271-25 138,388 33,823 172,211 16,137.44 10.67:1271 048-271-14 280,427 151,886 432,313 13,014.07 33.22:1272 048-271-13 57,126 39,448 96,574 13,014.07 7.42:1275 048-271-31 230,272 157,927 388,199 13,883.40 27.96:1276 048-271-19 422,368 71,856 494,224 14,575.75 33.91:1278 048-271-02 114,255 41,063 155,318 25,507.57 6.09:1279 048-271-03 57,126 16,020 73,146 13,014.07 5.62:1282 048-271-05 2,012,610 341,679 2,354,289 13,014.07 180.90:1283 048-271-06 839,318 152,646 991,964 25,507.57 38.89:1284 048-271-07 1,506,044 1,125,784 2,631,828 24,466.44 107.57:1287 048-302-01 133,181 110,043 243,224 17,178.57 14.16:1288 048-302-02 562,299 210,255 772,554 15,616.89 49.47:1290 048-302-04 666,602 70,102 736,704 15,616.89 47.17:1295 048-302-09 570,851 324,200 895,051 15,616.89 57.31:1297 048-302-11 93,289 39,169 132,458 17,178.57 7.71:1299 048-302-16 58,947 89,431 148,378 17,178.57 8.64:1301 048-302-14 526,407 34,637 561,044 17,178.57 32.66:1307 048-291-22 948,720 427,903 1,376,623 12,493.51 110.19:1308 048-291-23 2,072,485 268,415 2,340,900 13,014.07 179.87:1310 048-291-26 498,494 518,719 1,017,213 13,064.91 77.86:1316 048-291-15 58,949 81,813 140,762 13,014.07 10.82:1320 048-291-06 2,334,953 511,047 2,846,000 15,616.89 182.24:1323 048-291-09 467,684 68,222 535,906 14,575.75 36.77:1326 048-292-28 419,095 96,127 515,222 15,096.32 34.13:1329 048-292-03 538,777 203,586 742,363 13,014.07 57.04:1

H-6




ConfirmedAssessment


ConfirmedAssessment

330 048-292-04 $664,856 $156,626 $821,482 $13,014.07 63.12:1331 048-292-05 1,483,000 67,000 1,550,000 13,014.07 119.10:1332 048-292-06 1,516,140 183,860 1,700,000 13,014.07 130.63:1333 048-292-07 1,484,926 82,074 1,567,000 13,014.07 120.41:1334 048-292-27 58,949 31,998 90,947 14,055.19 6.47:1335 048-292-26 244,062 498,103 742,165 14,055.19 52.80:1336 048-292-32 58,952 24,811 83,763 14,055.19 5.96:1337 048-292-33 515,095 71,875 586,970 14,055.19 41.76:1338 048-292-10 135,786 53,244 189,030 15,616.89 12.10:1339 048-292-25 1,633,009 413,991 2,047,000 13,534.62 151.24:1340 048-292-24 620,784 265,079 885,863 13,014.07 68.07:1341 048-292-23 454,411 231,928 686,339 13,014.07 52.74:1346 048-292-18 262,901 177,102 440,003 10,931.81 40.25:1347 048-292-17 58,115 38,957 97,072 10,931.81 8.88:1348 048-292-35 438,525 136,976 575,501 10,931.81 52.64:1349 048-292-34 984,756 105,070 1,089,826 13,014.07 83.74:1351 048-292-14 130,649 35,368 166,017 11,972.94 13.87:1353 048-292-12 58,953 106,857 165,810 11,972.94 13.85:1355 048-281-01 58,944 66,245 125,189 15,616.89 8.02:1359 048-281-05 1,390,173 287,596 1,677,769 13,014.07 128.92:1360 048-281-06 253,638 82,231 335,869 13,014.07 25.81:1363 048-281-35 128,111 95,674 223,785 13,534.62 16.53:1371 048-281-30 761,646 323,315 1,084,961 16,658.00 65.13:1372 048-281-29 58,949 90,951 149,900 13,148.16 11.40:1375 048-281-26 128,118 38,183 166,301 13,534.62 12.29:1379 048-281-21 66,692 38,396 105,088 17,178.57 6.12:1381 048-281-19 1,783,638 75,362 1,859,000 24,466.44 75.98:1386 048-281-15 3,175,068 457,318 3,632,386 23,425.32 155.06:1

$135,427,219 $33,160,085 $168,587,304 $3,335,545.99 50.54:1

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$3,295,700 city of newport beach assessment district …cdiacdocs.sto.ca.gov/2009-0979.pdf · new...

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