Quote:
Originally Posted by Warren Kiefer
Dreamer I love your optimism but there is a but. Your statement is not quite correct, "If" the IRS rules against the bonds being tax free there is no doubt we might have to pay up. As I said in an earlier posting the Developer has total control over the VCCDD and the election of the committee members. It is my understanding that the VCCDD sold the bonds in question to purchase properties. Now here is where things get sticky. It is important to realize the VCCDD represents the Villages Residents eventhough it is controlled by the Developer. YThe VCCDD sells the bonds on our behalf to buy properties from the Developer. The Developer pockets a nice profit, and we (the Villagers) must pay back the borrowed money (the bonds). So, who's responsibility is it to pay if the IRS says no to the ineligible tax free bonds.
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I do not believe the residents are responsible for the bond total no matter what the result of the dispute. The financial transaction is between the VCCDD and the bond purchasers. We are not in the loop. Worst case, IMO, is that the VCCDD has insufficient funds to maintain the amenities due to the costs of IRS tax/penalties, and recalling and reissuing the bonds as taxable. However, we still have funds controlled by the AAC that perhaps could be brought to that problem..