1097.0015; 718625

RESOLUTION

ADOPTING BUDGET, IMPOSING MILL LEVY AND APPROPRIATING FUNDS

(2016)

The Board of Directors of Sterling Ranch Metropolitan District No. 1 (the “Board”), El

Paso County, Colorado (the “District”) previously held a budget hearing meeting at 20 Boulder

Crescent, 2nd

Floor, Colorado Springs, Colorado, on October 21, 2015, at the hour of 9:00 A.M.

Prior to the meeting, each of the directors was notified of the date, time and place of the

budget meeting and the purpose for which it was called and a notice of the meeting was posted or

published in accordance with §29-1-106, C.R.S.

[Remainder of Page Intentionally Left Blank].

NOTICE AS TO PROPOSED 2016 BUDGET

Thereupon, it was moved to adopt the following Resolution:

RESOLUTION

A RESOLUTION SUMMARIZING EXPENDITURES AND REVENUES FOR EACH FUND

AND ADOPTING A BUDGET AND APPROPRIATING SUMS OF MONEY TO EACH

FUND IN THE AMOUNTS AND FOR THE PURPOSES SET FORTH HEREIN FOR THE

DISTRICT FOR THE CALENDAR YEAR BEGINNING ON THE FIRST DAY OF

JANUARY 2016 AND ENDING ON THE LAST DAY OF DECEMBER 2016.

WHEREAS, the Board has authorized the District’s accountant to prepare and submit a

proposed budget to the Board in accordance with Colorado law; and

WHEREAS, the proposed budget has been submitted to the Board for its review and

consideration; and

WHEREAS, upon due and proper notice, provided in accordance with Colorado law, said

proposed budget was open for inspection by the public at a designated place, a public hearing

was held on October 21, 2015, interested electors were given the opportunity to file or register

any objections to said proposed budget and no written objections were filed prior to the public

hearing; and

WHEREAS, the budget being adopted by the Board has been prepared based on the best

information available to the Board regarding the effects of § 29-1-101, et seq., C.R.S., as

applicable, and Article X, § 20 of the Colorado Constitution.

NOW, THEREFORE, BE IT RESOLVED BY THE BOARD AS FOLLOWS:

Section 1. Summary of 2016 Revenues and 2016 Expenditures. The estimated

revenues and expenditures for each fund for fiscal year 2016, as more specifically set forth in the

budget attached hereto, are accepted and approved.

Section 2. Adoption of Budget. The budget as submitted, amended, attached hereto

and incorporated herein is approved and adopted as the budget of the District for fiscal year

2016. In the event of recertification of values by the County Assessor’s Office after the date of

adoption hereof, staff is hereby directed to modify and/or adjust the budget and certification to

reflect the recertification without the need for additional Board authorization. Any such

modification to the budget or certification as contemplated by this Section 2 shall be deemed

ratified by the Board.

Section 3. Levy for General Operating Expenses. For the purpose of meeting all

general operating expenses of the District during the 2016 budget year, there is hereby levied a

tax of ten (10.000) mills upon each dollar of the total valuation of assessment of all taxable

property within the District.

Section 4. Levy for Debt Service Obligations. For the purposes of meeting all debt

service obligations of the District during the 2016 budget year, there is hereby levied a tax of

forty (40.000) mills upon each dollar of the total valuation of assessment of all taxable property

within the District.

Section 5. Levy for Contractual Obligation Expenses. For the purposes of meeting

all contractual obligations of the District during the 2016 budget year, there is hereby levied a tax

of zero (0.000) mills upon each dollar of the total valuation of assessment of all taxable property

within the District.

Section 6. Levy for Capital Project Expenses. For the purposes of meeting all capital

project obligations of the District during the 2016 budget year, there is hereby levied a tax of

zero (0.000) mills upon each dollar of the total valuation of assessment of all taxable property

within the District.

Section 7. Certification to County Commissioners. The Board directs its legal

counsel, manager, accountant or other designee to certify to the Board of County Commissioners

of El Paso County, Colorado the mill levies for the District as set forth herein. Such certification

shall be in compliance with the requirements of Colorado law.

Section 8. Appropriations. The amounts set forth as expenditures and balances

remaining, as specifically allocated in the budget attached hereto and incorporated herein, are

hereby appropriated for the purposes thereof and no other.

Section 9. Filing of Budget and Budget Message. The Board hereby directs its legal

counsel, manager or other designee to file a certified copy of the adopted budget resolution, the

budget and budget message with the Division of Local Government by January 30 of the ensuing

year.

Section 10. Budget Certification. The budget shall be certified by a member of the

District, or a person appointed by the District, and made a part of the public records of the

District.

The foregoing Resolution was seconded.

[Remainder of page intentionally left blank].

EXHIBIT A

BUDGET DOCUMENT

BUDGET MESSAGE

Sterling Ranch Metropolitan District No. 1

2016 Budget

Budget Message/Summary of Assumptions

Attached is a copy of the forecasted budget of revenue, expenditures and fund balances for the

2016 budget for the Sterling Ranch Metropolitan District No. 1 (the District) for the year ending

December 31, 2016.

The District has adopted a General Fund for general operating expenses.

The budget utilizes the modified accrual basis of accounting and has been adopted after proper

notification and a public hearing thereon.

Services Provided The District, a quasi-municipal corporation and political subdivision of the State of Colorado,

was organized by order and decree of the District Court for El Paso County, and recorded on

March 7, 2011. The District operates under a Consolidated Service Plan with Sterling Ranch

Metropolitan District Nos. 2 and 3.

The District was organized to provide financing, acquisition, construction and installation of

public infrastructure as contemplated in the Consolidated Service Plan to support the needs of

development within its boundaries and District Nos. 2 and 3.

Revenue

The District is in the development stage. The operating and administrative expenditures for 2016

are expected to be funded by a portion of the property taxes and possible developer advances.

District formation and capital expenses were funded by the developer. Developer expenditures

on behalf of benefiting the District (“advances”) are recorded as revenue for budget purposes

with an obligation for future repayments when the District is financially able to make

reimbursements. The District has levied property taxes for 2016 collection.

Expenditures

Administrative expenses have been estimated based upon the level of expenditures incurred by

similar districts of comparable size and planned level of activity/development estimated to occur

during 2016. Administrative expenditures include the services necessary to maintain the

District’s administrative viability such as legal, accounting, insurance, meeting expenses and

other administrative needs.

STERLING RANCH METROPOLITAN DISTRICT 2015 AMENDED AND 2016 BUDGET

DISTRICT 1 - GENERAL FUND

2014 2015 2015 2015 2016BUDGET ACTUAL AMENDED BUDGET BUDGET

BUDGET

GENERAL FUND BEGINNING BALANCE -$ -$ -$ -$ 51.60$

REVENUESDEVELOPER ADVANCE 800.00$ 800.00$ 70,000.00$ 3,092.40$ O&M MILL LEVY (10) - DISTRICT 2 -$ -$ -$ 1,017.57$ -$ O&M MILL LEVY (10) - DISTRICT 3 -$ -$ -$ 295.43$ -$

TOTAL REVENUES -$ 800.00$ 800.00$ 71,313.00$ 3,092.40$

TOTAL REVENUE & FUND BALANCE -$ 800.00$ 800.00$ 71,313.00$ 3,144.00$

EXPENDITURESBOARD OF DIRECTORS FEEDISTRICT MANAGEMENT/ACCOUNTING -$ -$ 24,000.00$ -$ OFFICE/POSTAGEAUDIT EXEMPTION -$ -$ 1,000.00$ -$ GENERAL LIABILITY INSURANCE 250.00$ 250.00$ 5,000.00$ 2,500.00$ SDA DUES 426.40$ 426.40$ 1,000.00$ 500.00$ LEGAL (General, Special, Condemnation) -$ -$ 40,000.00$ -$ TREASURER'S FEES -$ -$ -$ 18.41$ -$ BANK SERVICE CHARGES 72.00$ 72.00$ 100.00$ 144.00$ REPAY DEVELOPER ADVANCESMISCELLANEOUS/ENGINEERING

TOTAL EXPENDITURES -$ 748.40$ 748.40$ 71,118.41$ 3,144.00$

ENDING FUND BALANCE -$ 51.60$ 51.60$ 194.59$ -$ 3% EMERGENGY RESERVE -$ 22.45$ 22.45$ 2,133.55$ 94.32$

ASSESSED VALUATION DISTRICT 1 0.000 0.000 0.000 0.000MILL LEVY 10.000 10.000 10.000 10.000

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STERLING RANCH METROPOLITAN DISTRICT 2015 AMENDED AND 2016 BUDGETDISTRICT 1 - DEBT SERVICE FUND

RESERVE FUND BEGINNING BALANCE -$ -$ -$ 2,541,980.37$ -$

2014 2015 2015 2015 2016BUDGET ACTUAL AMENDED BUDGET BUDGET

BUDGET

REVENUE FUND BEGINNING BALANCE -$ -$ -$ -$ -$

REVENUES - BONDS -$ -$ 456,200.00$ -$ D2- PROPERTY TAXES -$ -$ -$ 4,755.00$ -$ D2- SPECIFIC OWNERSHIP TAXES -$ -$ -$ 332.85$ -$ D2- DELINQUENT TAX AND INTERESTD2- PY TAX ABATEMENT AND INTERESTD3- PROPERTY TAXES -$ -$ -$ 1,380.50$ -$ D3- SPECIFIC OWNERSHIP TAXES -$ -$ -$ 96.64$ -$ D3- DELINQUENT TAX AND INTERESTD2- BUILDING PERMIT FEES RESIDENTIAL ($______/unit) -$ -$ -$ -$ -$ D2- BUILDING PERMIT FEES RES MULTI ($______/unit)D3- BUILDING PERMIT FEES COMMERCIAL ($______/SF) -$ -$ -$ -$ -$ TXFR IN FROM DEBT SERVICE RESERVEINTEREST INCOME

TOTAL REVENUES -$ -$ -$ 462,764.99$ -$

TOTAL REVENUE & FUND BALANCE -$ -$ -$ 462,764.99$ -$

EXPENDITURESBOND INTEREST -$ -$ -$ -$ -$ BOND PRINCIPAL -$ -$ -$ -$ -$ TXFR TO SURPLUSBANK SERVICE CHARGES/BOND FEES -$ -$ -$ -$ -$ TREASURERS FEES -$ -$ -$ 92.03$ -$ COST OF ISSUANCE -$ -$ 456,200.00$ -$

TOTAL EXPENDITURES -$ -$ -$ 456,292.03$ -$

ENDING FUND BALANCE -$ -$ -$ 6,472.95$ -$

ASSESSED VALUATION DISTRICT 1 0.000 0.000 0.000 0.000MILL LEVY 0.000 0.000 0.000 40.000TOTAL MILL LEVY 0.000 0.000 0.000 50.000

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STERLING RANCH METROPOLITAN DISTRICT 2015 AMENDED AND 2016 BUDGET

DISTRICT 1 - PROJECT FUND

2014 2015 2015 2015 2016BUDGET ACTUAL AMENDED BUDGET BUDGET

BUDGET

CAPITAL PROJECT FUND BEGINNING BALANCE -$ -$ -$ -$ -$

REVENUES- BONDS -$ -$ 5,400,000.00$ -$ COST RECOVERIESDEVELOPER ADVANCE 55,000.00$ INTEREST INCOME

TOTAL REVENUES 55,000.00$ -$ -$ 5,400,000.00$ -$

TOTAL REVENUE & FUND BALANCE 55,000.00$ -$ -$ 5,400,000.00$ -$

EXPENDITURESFORMATION COST REIMBURSEMENT -$ CAPITAL CONSTRUCTION 55,000.00$ -$ -$ 3,730,000.00$ -$ CONSTRUCTION OVERSIGHT -$ -$ 50,000.00$ -$ ENGINEERINGLEGAL (General, Special, Condemnation)BANK SERVICE CHARGESPROJECT MANAGEMENT -$ -$ -$ -$ DISTRICT MANAGEMENT -$ -$ 48,000.00$ -$ WATER RIGHTSWATER LINE DELIVERYSANITARY SEWER IGASEWER INFRASTRUCTURE REIMBURSEMENTREPAY DEVELOPER ADVANCES

TOTAL EXPENDITURES 55,000.00$ -$ -$ 3,828,000.00$ -$

ENDING FUND BALANCE -$ -$ -$ 1,572,000.00$ -$

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