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November 19, 2007 (Regular Meeting) Page 617 (ii) The net proceeds of all other ad valorem taxes levied by the County and the City in any year shall be multiplied by a fraction, the numerator of which is the base valuation for the Development Financing District and the denominator of which is the current valuation for the District. The City and the County acknowledge that as a result of the operation of the Minimum Assessed Value Agreement, the City and the County may have different tax valuations for the District, and that the computation described in the preceding sentence will use the City's valuation for purposes of this determination as it pertains to the City's ad valorem taxes, and will use the County's valuation for purposes of this determination as it pertains to the County's ad valorem taxes. The amount shown as the product of this multiplication shall, when paid by the taxpayer, be retained by the County or the City, or special district, as if there were no Development Financing District in existence. (A) With respect to taxes levied by the City, the net proceeds of the remaining amount shall, when paid by the taxpayer, be turned over to the Finance Director of the City (the "Finance Director"), who shall transmit this amount to the Trustee for deposit in the Issuer Contribution Account of the Incremental Revenue Fund. (B) With respect to taxes levied and collected by the County, the lesser of (y) 100$ of the net proceeds of the remaining amount or (z) 50$ of the aggregate annual principal and interest requirements for the Bonds (net of (1) any amounts available in the County Contribution Account, (2) the County Proportion (as defined below) of the amount of proceeds of the Bonds that are restricted to the payment of capitalized interest or any amount actually paid from Bond proceeds (including investment earnings) for capitalized interest funded from the proceeds of any Bonds or (3) the County Proportion of interest earnings required to be applied to the payment of Bonds) (the "Maximum County Contribution Amount") shall be transmitted to the Trustee for deposit in the County Contribution Account of the Incremental Revenue Fund. The County shall transmit any amounts due hereunder on each March 1 and September 1. Any net proceeds with respect to taxes levied by the County that exceed the Maximum County Contribution Amount shall be retained by the County as if there were no Development Financing District in existence. (C) In the event a reserve fund is established from the proceeds of the Bonds, if the amount of Bond proceeds on deposit in such reserve fund is reduced for any reason, the amount of such reduction shall be applied (i) to reduce the principal amount of Bonds Outstanding, (ii) to pay annual debt service payments on the Bonds or (iii) to the payment of Redevelopment Project Costs; provided, however, that the County Proportion of such reduction may not be applied to the payment of Redevelopment Project Costs without the prior consent of the County and, in the absence of such consent, shall be applied as a credit to the amounts required under (B) above. (D) For purposes of (B) and (C) above, County Proportion as of any date of determination shall mean the proportion of total debt service on the Bonds that is being paid from amounts received from the County under (B) above. The City and the County acknowledge that there is an agreement relating to the remittance by the County of taxes collected on behalf of the City. The provisions of that agreement or any subsequent amendment or replacement shall control the remittance of collections of taxes collected for the City. Also, the City and the County recognize that the payment of taxes for motor vehicles is on a different schedule from the payment of taxes for real property. The provisions relating to semiannual payment of the County Contribution may be modified with respect to taxes collected for motor vehicles so that such collection are transmitted more frequently than semiannually. SECTION 2.3. Use of Moneys in Incremental Revenue Fund. So long as any portion of the Bonds are outstanding, amounts in the Incremental Revenue Fund shall be applied as provided in the Indenture. Any amounts in the Incremental Revenue Fund that are released under the Indenture shall be applied as follows: (a) To pay capital expenditures incurred in connection with Public Improvements by the City or the County in the Development Financing District pursuant to the Development Financing Plan; provided that no withdrawals may be made from the County Contribution Account without the consent of the County.