While it is way too early to draw any conclusions or get anxious about the potential IRS ruling, if the ruling finally made is to deem the bonds to be taxable instead of tax free, and the CDC has to either find a way to fund the increase in the interest rate or repurchase the bonds, there would then be another lengthy negotiation or litigation (depending on the position of the developer), because the implication would be that the developer was paid too much for the properties sold to the districts. The liability would most likely revert to the developer who profited from the sale of the amenities to the district at "fair values" that would be quite different were tax-free financing not available at the time of the sale to the district. I suspect the developer will take more of a hit from an adverse ruling than will the home owners.