California Debt and Investment Advisory Commission

Draw on Reserve or Default Report

Palmdale CFD No. 93-1 Mello-Roos Community Facilities Districts

This report is based on unaudited information reported to the California Debt and Investment Advisory Commission pursuant to Government Code Section 53359.5(c) from sources considered to be reliable. The Commission is not liable for inadvertent errors or omissions that are reported as part of these reports.

Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Default
Date of Event:  3/1/2014
Amount Not Paid:  $0
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On March 1, 2014 the debt service on the bonds in the amount of $1,423,750 was due, consisting of interest in the amount of $1,423,750. The reserve fund has been depleted and the debt service has not been paid and is now past due.

Date Received:   3/6/2014
Date posted to this website:   Monday, April 14, 2014


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Default
Date of Event:  3/1/2013
Amount Not Paid:  $0
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On September 1, 2013 the scheduled debt service on the bonds in the amount of $3,047,950.00 was due, consisting of principal in the amount of $1,665,000.00 and interest in the amount of $1,382,950.00. The reserve fund has been depleted and the debt service has not been paid and is now past due.

Date Received:   9/6/2013
Date posted to this website:   Friday, September 27, 2013


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Default
Date of Event:  9/1/2013
Amount Not Paid:  $0
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On September 1, 2013 the scheduled debt service on the bonds in the amount of $3,047,950.00 was due, consisting of principal in the amount of $1,665,000.00 and interest in the amount of $1,382,950.00. The reserve fund has been depleted and the debt service has not been paid and is now past due.

Date Received:   9/4/2013
Date posted to this website:   Thursday, May 08, 2014


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Default
Date of Event:  3/1/2013
Amount Not Paid:  $0
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On March 1, 2013 the scheduled debt service on the bonds in the amount of $1,382,950.00 was due, consisting of interest in the amount of $1,382,950.00. The reserve fund has been depleted and the debt service has not been paid and is now past due.

Date Received:   3/11/2013
Date posted to this website:   Wednesday, March 27, 2013


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Default
Date of Event:  9/1/2012
Amount of Default:  $0
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On September 1, 2012 the scheduled debt service on the bonds in the amount of $2,383,750.00 was due, consisting of principal in the amount of $960,000.00 and interest in the amount of $1,423,750.00. The Fiscal Agent was required to draw from the reserve fund in order to make the scheduled debt service payment. As a result, the remaining reserve fund balance in the amount of $373,827.34 was used to pay debt service. The reserve fund has been depleted and the remaining $2,009,922.66 of debt service has not been paid and which amount is now past due.

Date Received:   9/10/2012
Date posted to this website:   Tuesday, October 16, 2012


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Draw on Reserve
Date of Event:  9/1/2012
Amount Withdrawn:  $373,827.34
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On September 1, 2012 the scheduled debt service on the bonds in the amount of $2,383,750.00 was due, consisting of principal in the amount of $960,000.00 and interest in the amount of $1,423,750.00. The Fiscal Agent was required to draw from the reserve fund in order to make the scheduled debt service payment. As a result, the remaining reserve fund balance in the amount of $373,827.34 was used to pay debt service. The reserve fund has been depleted and the remaining $2,009,922.66 of debt service has not been paid and which amount is now past due.

Date Received:   9/10/2012
Date posted to this website:   Tuesday, October 16, 2012


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Draw on Reserve
Date of Event:  3/1/2012
Amount Withdrawn:  $1,423,750.00
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On March 1, 2012 the district was required to draw $1,423,750.00 from the reserve fund in order to fulfill its obligation to bond holders to make the scheduled debt service payment in the amount of $1,423,750.00. As a result, the reserve fund balance is $373,795.89, which is less than the current reserve requirement of $3,350,000.00.

Date Received:   3/5/2012
Date posted to this website:   Thursday, April 19, 2012


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Draw on Reserve
Date of Event:  9/1/2011
Amount Withdrawn:  $1,423,745.66
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On September 1, 2011 the district was required to draw $1,423,745.66 from the reserve fund in order to fulfill its obligation to bond holders to make the scheduled debt service payment in the amount of $1,423,750.00. As a result, the reserve fund balance is $1,797,206.94, which is less than the current reserve requirement of $3,350,000.00.

Date Received:   9/6/2011
Date posted to this website:   Wednesday, September 28, 2011


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  1995-0137
Type of Event:  Draw
Date of Event:  3/1/2011
Amount Withdrawn:  $129,730.11
Contact:  Kristin Harvey, NBS
Phone Number:  (951) 296-1997

Comments:  
On March 1, 2011 the district was required to draw from the reserve fund in order to fulfill its obligation to bond holders to make the scheduled debt service payment in the amount of $1,423,750.00. As a result, the reserve fund balance is $3,220,608.93, which is less than the current reserve requirement of $3,350,000.00.

Date Received:   3/2/2011
Date posted to this website:   Friday, March 04, 2011


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  3/1/2007
Amount of Default:  
Contact:  Kristin Harvey, NBS
Phone Number:  (800) 676-7516

Comments:  
The City has been advised that the delinquent special taxes subsequently have been paid together with the ad valorem levy on the subject parcels, but the City has not yet received the delinquent special taxes to paid to the County.

Date Received:   3/20/2007
Date posted to this website:   Monday, June 18, 2007


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  6/30/2002
Amount of Default:  
Contact:  Joe Flores
Phone Number:  (909) 296-1997

Comments:  
All parcels within the district have been delinquent since the first Special Tax levy in 1996/97. The City has initiated foreclosure and pursued collection of the delinquencies. For further information, refer to the District's financial report dated June 30, 2002.

Date Received:   10/30/2003
Date posted to this website:   Wednesday, May 26, 2004


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  6/30/2002
Contact:  Joe Flores
Phone Number:  (909) 296-1997

Comments:  
Status Report

RE: City of Palmdale CFD No. 93-1 (Ritter Ranch) Special Tax Bonds, Series 1995-A

All parcels within the district have been delinquent since the first Special Tax levy in 1996/97. The City has initiated foreclosure and pursued collection of the delinquencies as described below.

In April 1995 the City issued $50,000,000 of special tax bonds for the design, acquisition and construction of public improvements for a master-planned community known as Ritter Ranch consisting of approximately 10,444 acres. The mixed-use project incorporates residential, open space, public facility, recreational, school and commercial uses. As of June 30, 2002, a total of $40,700,000 in bonds was outstanding for Ritter Ranch Community Facilities District No. 93- 1. The principal and interest on the bonds is to be paid from the collection of special taxes on the property in the CFD.

As of June 30, 2002, approximately $82,792,075 of delinquent special taxes remain outstanding. The cumulative delinquency rate through fiscal year 2001-2002 was 100 percent. Foreclosure proceedings were commenced on these delinquent parcels but presently stayed by bankruptcy court. Proceeds from property foreclosure sales will be used to fund the District's delinquent debt and to replenish the Reserve Fund for the bonds.

On March 1, 1998, there were insufficient funds on hand to make the full schedule payment of interest due on the Community Facilities District No. 93-1 Bonds because of delinquencies within the District. Partial proportionate payments were made on the senior and subordinate bonds on March 2, 1998, totaling $842,535. In 1998 amendments to the Fiscal Agent Agreement were made which allowed for the transfer of investment earnings from the Improvement Fund to the Bond Fund so debt service could be paid in full. Accordingly, a transfer in the amount of $884,965 was made on May 20, 1998, which allowed for the balance of the unpaid interest to be paid to the bondholders. Subsequently, another amendment to the Fiscal Agent Agreement was made in 1998 allowing another transfer of investment earnings from the Improvement Fund to the Bond Fund so the regularly scheduled senior and subordinate interest payments could be paid on September 1, 1998. Principal in the amount of $300,000 maturing on the subordinate bonds on September 1, 1998, was paid in October 1998 with funds received from the entity that took over the project. On March 1, 1999, a partial proportionate interest only payment was made to only senior bondholders in the amount of $133,665, and on August 1, 2001, and September 4, 2001, additional proportionate interest payments of $750,000 on each such date were made only to senior bondowners.

In December 1997, the City commenced foreclosure proceedings in respect of delinquent special tax levies. In May 1998, the City entered into a Settlement Agreement with the then owner of the property in the Community Facilities District and others which provided for certain payments and a stipulated foreclosure judgment if those payments were not made and certain agreements were not completed by March 1999 (September 1999 if certain payments were made). Some of the required payments were made, including those used to pay the bonds, as described in the preceding paragraph. The property within the Community Facilities District was sold to a prospective developer in the fall of 1998, who then filed for bankruptcy. The Community Facilities District is currently under the jurisdiction of the federal bankruptcy court. Because the federal courts have absolute jurisdiction in these matters, the City's foreclosure proceedings for delinquent special tax levies needed to pay the bonds have been suspended.

In the spring of 2000, the bankruptcy court confirmed a plan of reorganization promoted by the City which provided for a transfer of the property within the Community Facilities District to a new developer entity. The reorganization plan was contingent upon a successful closing under an implementation agreement among the City, the owner of the senior bonds, and the entity responsible for forming the new developer entity. The closing never occurred and the reorganization was withdrawn.

The City, for and on behalf of the CFD 93-1, incurred and paid from its own funds covered bankruptcy costs and other bankruptcy costs that are in excess of $1,500,000.

On August 1, 2001 and September 4, 2001, funds were wired to the City fiscal agent, from the Improvement Fund per City Council Resolution and Supplement No. 8 to the Fiscal Agent Agreement approved by owners of 2/3 of the bonds outstanding executed July 31, 2001 by the fiscal agent in the amount of $750,000 on each such date. This total amount of $1,500,000 has been recorded in the General Fund as revenue in FY 2001-2002 to offset the expenditures incurred and paid from the General Fund in FY 1999-2000, FY 2000-2001, and FY 2001-2002. Since some of the legal costs incurred on behalf of the CFD have been recaptured, the expenditures totaling $1,500,000 were then transferred from the General Fund to the Improvement Fund for the District in FY 2001-2002.

In the summer of 2001, the current owner of the property in CFD 93-1 introduced a reorganization plan in the bankruptcy court. The funding necessary for the bankruptcy plan was never provided and a bankruptcy trustee was appointed by the bankruptcy court on October 31, 2001. At this time it is not expected that the bankruptcy plan will ever be implemented in the form approved by the bankruptcy court. If the bankruptcy plan is not implemented, it is unknown at this time what, if any actions will occur to reinstate the payment of past due and current debt service on the bonds.

None of the bonds described above constitute indebtedness of the City payable from its general funds, and the City is in no way obligated for their repayment except to the extent of the special taxes collected and pledged for their repayment. The City is only acting on behalf of the bondowners in collecting the special taxes levied to repay the bonds from the property owners, forwarding the collections to the bondowners and initiating foreclosure proceedings, if necessary.

For further information, refer to the District's financial report dated June 30, 2002

Date Received:   10/31/2002
Date posted to this website:   Thursday, February 20, 2003


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  9/4/2001
Contact:  Dave Ketcham
Phone Number:  (909) 296-1997

Comments:  
On March 1, 1999, a partial proportionate interest payment was made to only senior bondowners in the amount of $133,665, and on August 1, 2001 and September 4, 2001 additional proportionate interest payments of $750,000 on each such date were made only to senior bondowners.

In December 1997, the City commenced foreclosure proceedings in respect of delinquent special tax levies. In May 1998, the City entered into a Settlement Agreement with the then owner of the property in the Community Facilities District and others which provided for certain payments and a stipulated foreclosure judgment if those payments were not made and certain agreements were not completed by March 1999 (September 1999 if certain payments were made). Some of the required payments were made, including those used to pay the bonds, as described in the preceding paragraph.

The property within the Community Facilities District was sold to a prospective developer in the fall of 1998 who then filed for bankruptcy. The Community Facilities District is currently under the jurisdiction of the federal bankruptcy court.

In the spring of 2000, the bankruptcy court confirmed a plan of reorganization promoted by the City, which provided for a transfer of the property within the Community Facilities District to a new developer entity. The reorganization plan was contingent upon a successful closing under an implementation agreement among the City, the owner of the senior bonds, and the entity responsible for forming the new developer entity. The closing never occurred and the reorganization plan was withdrawn.

In the spring and summer of 2001, the current owner of the property in CFD 93-1 introduced a reorganization plan in the bankruptcy court. If the property owner's bankruptcy plan is consummated, the interest due on the bonds will be brought current, the bonds will be called for redemption at par from the existing bondholders, and the bonds will be purchased in lieu of redemption by the current property owner. If the funding necessary for the bankruptcy plan is not provided, a bankruptcy trustee will be appointed by the bankruptcy court and the foreclosure proceedings against property in CFD 93-1 may be reinstated. No assurance can be given at this time that the bankruptcy plan will be implemented in the form approved by the bankruptcy court. If the bankruptcy plan is not implemented, it is unknown at this time what, if any actions will occur to reinstate the payment of past due and current debt service on the bonds.

Date Received:   10/16/2001
Date posted to this website:   Monday, November 26, 2001


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  8/1/2001
Contact:  Dave Ketcham
Phone Number:  (909) 296-1997

Comments:  
On March 1, 1999, a partial proportionate interest payment was made to only senior bondowners in the amount of $133,665, and on August 1, 2001 and September 4, 2001 additional proportionate interest payments of $750,000 on each such date were made only to senior bondowners.

In December 1997, the City commenced foreclosure proceedings in respect of delinquent special tax levies. In May 1998, the City entered into a Settlement Agreement with the then owner of the property in the Community Facilities District and others which provided for certain payments and a stipulated foreclosure judgment if those payments were not made and certain agreements were not completed by March 1999 (September 1999 if certain payments were made). Some of the required payments were made, including those used to pay the bonds, as described in the preceding paragraph.

The property within the Community Facilities District was sold to a prospective developer in the fall of 1998 who then filed for bankruptcy. The Community Facilities District is currently under the jurisdiction of the federal bankruptcy court.

In the spring of 2000, the bankruptcy court confirmed a plan of reorganization promoted by the City, which provided for a transfer of the property within the Community Facilities District to a new developer entity. The reorganization plan was contingent upon a successful closing under an implementation agreement among the City, the owner of the senior bonds, and the entity responsible for forming the new developer entity. The closing never occurred and the reorganization plan was withdrawn.

In the spring and summer of 2001, the current owner of the property in CFD 93-1 introduced a reorganization plan in the bankruptcy court. If the property owner's bankruptcy plan is consummated, the interest due on the bonds will be brought current, the bonds will be called for redemption at par from the existing bondholders, and the bonds will be purchased in lieu of redemption by the current property owner. If the funding necessary for the bankruptcy plan is not provided, a bankruptcy trustee will be appointed by the bankruptcy court and the foreclosure proceedings against property in CFD 93-1 may be reinstated. No assurance can be given at this time that the bankruptcy plan will be implemented in the form approved by the bankruptcy court. If the bankruptcy plan is not implemented, it is unknown at this time what, if any actions will occur to reinstate the payment of past due and current debt service on the bonds.

Date Received:   10/16/2001
Date posted to this website:   Monday, November 26, 2001


Issuer:  Palmdale CFD No. 93-1
County:  Los Angeles
Project:  Ritter Ranch
Original Sale Date:  4/5/1995
CDIAC Number:  95-0137
Type of Event:  Default
Date of Event:  3/1/1999
Contact:  Dave Ketcham
Phone Number:  (909) 296-1997

Comments:  
On March 1, 1999, a partial proportionate interest payment was made to only senior bondowners in the amount of $133,665, and on August 1, 2001 and September 4, 2001 additional proportionate interest payments of $750,000 on each such date were made only to senior bondowners.

In December 1997, the City commenced foreclosure proceedings in respect of delinquent special tax levies. In May 1998, the City entered into a Settlement Agreement with the then owner of the property in the Community Facilities District and others which provided for certain payments and a stipulated foreclosure judgment if those payments were not made and certain agreements were not completed by March 1999 (September 1999 if certain payments were made). Some of the required payments were made, including those used to pay the bonds, as described in the preceding paragraph.

The property within the Community Facilities District was sold to a prospective developer in the fall of 1998 who then filed for bankruptcy. The Community Facilities District is currently under the jurisdiction of the federal bankruptcy court.

In the spring of 2000, the bankruptcy court confirmed a plan of reorganization promoted by the City, which provided for a transfer of the property within the Community Facilities District to a new developer entity. The reorganization plan was contingent upon a successful closing under an implementation agreement among the City, the owner of the senior bonds, and the entity responsible for forming the new developer entity. The closing never occurred and the reorganization plan was withdrawn.

In the spring and summer of 2001, the current owner of the property in CFD 93-1 introduced a reorganization plan in the bankruptcy court. If the property owner's bankruptcy plan is consummated, the interest due on the bonds will be brought current, the bonds will be called for redemption at par from the existing bondholders, and the bonds will be purchased in lieu of redemption by the current property owner. If the funding necessary for the bankruptcy plan is not provided, a bankruptcy trustee will be appointed by the bankruptcy court and the foreclosure proceedings against property in CFD 93-1 may be reinstated. No assurance can be given at this time that the bankruptcy plan will be implemented in the form approved by the bankruptcy court. If the bankruptcy plan is not implemented, it is unknown at this time what, if any actions will occur to reinstate the payment of past due and current debt service on the bonds.

Date Received:   10/16/2001
Date posted to this website:   Monday, November 26, 2001