Explain the lawsuit

[rp001]

Can someone, more intelligent than me, please give us an explanation in simple english the pending lawsuit mentioned in today's Sun against just about all, and it's impact on the bond refinance? What is the "transfer" the lawsuit is referring
too?

[Taltarzac725]

See that story on the Local Front page.

[rubicon]

I have followed this bond issue from its inception and secured the filings by the IRS to understand their list of complaints. I strongly suggest that people should read for themselves the IRS filings and the circumstances of negotiations between Villages of Lake Sumter, Inc and the District. This latest class action suit followed by District 5 probably stems from the initial IRS complaints. since this is a class action suit residents affected should be given a copy of the complaint and/or a detailed written explanation as to the allegations involved in this suit. We should also be advised as to how this lawsuit is being financed?

If my opinions are incorrect then someone with legal authority needs to come forward and finally open this IRS bond issue in its entirety to get it aired out once and for all so that we can determine the truth and finally solutions

I opine other can decide

[mickey100]

We don't get the paper. Would appreciate hearing about what this lawsuit is. Thanks.

[Taltarzac725]

We don't get the paper. Would appreciate hearing about what this lawsuit is. Thanks.

The Villages IRS Problem (http://www.thevillagesfloridabook.com/the-villages-irs-problem/)

It sounds like it has something to do with alleged irregularities with purchases through bonds in District 5. They really do not give much in the way of details probably because it is in litigation. They name the parties, lawyers, etc. but do not say much more than that.

[janmcn]

The Villages IRS Problem (http://www.thevillagesfloridabook.com/the-villages-irs-problem/)

It sounds like it has something to do with alleged irregularities with purchases through bonds in District 5. They really do not give much in the way of details probably because it is in litigation. They name the parties, lawyers, etc. but do not say much more than that.

Why does this lawsuit only pertain to alleged irregularities with purchases through bonds in District 5? Has the developer turned over to the district all the amenities in District 5?

[rp001]

See that story on the Local Front page.
I did and it doesn't say squat, except the refinance will not be available and it will cost the vcdd "millions"!

[zcaveman]

I do not think this has anything to do with the IRS lawsuit. It seems that it is a lawsuit by these three people against TV. TV is causing it a frivolous lawsuit because there is nothing they can sue about.

Forget the IRS in this lawsuit.

Z

[TVMayor]

We don't get the paper. Would appreciate hearing about what this lawsuit is. Thanks.

http://i264.photobucket.com/albums/ii199/The_Villages/SUN_zps4e4882d7.jpg

[TVMayor]

From August 6, 2014

VCCDD, AAC hoping to refinance bonds to lock in lower interest rates
August 6, 2014 By Marv Balousek
The Village Center Community Development District is moving swiftly to refinance millions of dollars in utility and amenity bonds before interest rates rise.
The district board voted Wednesday to proceed with bond refinancing as early as Sept. 8. The board also approved several resolutions to speed the process by retaining its current financial advisers, who are familiar with The Villages financial structure.
Earlier in the day, the Amenity Authority Committee also agreed to begin looking into refinancing bonds in hopes of locking in a lower interest rate.
“We have an aggressive timetable we have put together,” said District Manager Janet Tutt.
Besides saving money on interest rates, the move also could help with the district’s long-running dispute with the Internal Revenue Service by converting older tax-exempt bonds to taxable bonds.
“The reason for this quite simply is we have incredibly low interest rates,” said Supervisor Gary Moyer, who made the motion to begin the refinancing process.
The bonds were issued to pay for utilities such as sewer and water lines as well as amenities that include pools and recreation centers. Refinancing the bonds would mean that holders of the current bonds would be paid off and new bonds would be sold.
Elaine Dreidame, president of the Property Owners Association, said refinancing now is a good move.
“This would be a step ahead of the game,” she said. “I think it’s definitely the right thing to do.”
Moving tax-exempt bonds to taxable bonds would strike at the heart of the district’s dispute with the IRS.
The agency has challenged about $426 million in tax-exempt bonds issued by the district between November 1993 and June 2004. Those proceeds were used for commercial development in the Spanish Springs area.
The IRS has said those bonds could not be tax-exempt because the district’s board is chosen by landowners and not by voters. The district’s attorney has accused the agency of changing the rules after the bonds were issued.
The IRS is expected to make a final ruling in the case soon and, if the agency rules against the district, the fight could move to the courts.
A settlement proposed in 2009 would have required the district to recall the remaining tax-exempt 30-year bonds and issue them again as taxable bonds. The cost of reissuing them would have been paid by amenity fees from homeowners living north of County Road 466 unless Bond Counsel or another party were found culpable.
That settlement was rejected, but the district effectively would be doing the same thing now by refinancing the tax-exempt bonds as taxable ones without the cost of a recall.
“I can’t frankly see this coming to a conclusion in the near future,” Moyer said of the IRS dispute.
But he said it’s important to move quickly on refinancing the bonds so the district can capture the current favorable interest rates.
“We have to recognize there is a lot of work that has to be done in a very short period of time,” he said.

[TVMayor]

The lowering of the interest rates paid on the bonds would have saved the homeowners money because the money used to pay the interest comes out of our amenity fees.

I am no attorney but in my opinion I think it would have been more financially prudent to wait till after the lower rate bonds were issued to make a stink.

[Johnd]

There is a possibility that this is political action by a lawless IRS designed to tie down or intimidate Morse; a big political player on the other side of the aisle. Certainly the IRS under this Justice Department has earned no benefit of the doubt against such speculation.

If so, the whole issue should start winding down over the next couple years.

[Advogado]

There is a possibility that this is political action by a lawless IRS designed to tie down or intimidate Morse; a big political player on the other side of the aisle. Certainly the IRS under this Justice Department has earned no benefit of the doubt against such speculation.

If so, the whole issue should start winding down over the next couple years.

I have a couple of observations:

1. This lawsuit is obviously extremely important to Villagers. It was initiated in March. Why is the Daily Sun only now reporting its existence, and in such a cryptic manner as to make it impossible for readers to understand the issues and implications? (It is reminiscent of the Daily Sun's treatment of the IRS investigation.) Also note that the article only quotes the Developer's side of the story. It would have been a simple matter to send a reporter out to interview the plaintiffs. Note that the Plaintiff's attorney is the same one who represented the plaintiffs in the class-action lawsuit that recovered $43 million from the Developer for the benefit of The Villagers, so I would not be quick to conclude that this lawsuit has no basis.

2. It will be worthwhile attending the POA meeting this Tuesday evening, where we can probably get an explanation as to what the lawsuit involves-- since we are not going to get it from the Daily Sun.

[graciegirl]

I am very skeptical about this. THE SAME PEOPLE???? Talk about cryptic, I could never understand why the "other" lawsuit was brought.

I am not a fan of the POA. I would gladly join a new organization if one were formed. AND I trust the Daily Sun.

[Bryan]

The previous $43 million lawsuit (which the developer lost, BTW) was due to shortchanging the districts on maintenance and replacement funds for all the facilities transferred to them by the developer. At that time, all of Districts 1, 2, 3, and 4 (not sure about the Lake County district) were involved but nothing south of CR 466 was involved. This sounds like similar shenanigans were discovered/suspected/alleged in District 5 - which is now pretty much turned over by the Developer to the residents - and they are seeking their share of the money. If I recall, the original lawsuit was initially classified as frivolous by the Developers lawyers yet they lost to the tune of $43 million and it led to the formation of the AAC. That doesn't sound so frivolous to me. I do hope we get a clearer explanation of the suit Tuesday at the POA meeting - I will be there.

[graciegirl]

The previous $43 million lawsuit (which the developer lost, BTW) was due to shortchanging the districts on maintenance and replacement funds for all the facilities transferred to them by the developer. At that time, all of Districts 1, 2, 3, and 4 (not sure about the Lake County district) were involved but nothing south of CR 466 was involved. This sounds like similar shenanigans were discovered/suspected/alleged in District 5 - which is now pretty much turned over by the Developer to the residents - and they are seeking their share of the money. If I recall, the original lawsuit was initially classified as frivolous by the Developers lawyers yet they lost to the tune of $43 million and it led to the formation of the AAC. That doesn't sound so frivolous to me. I do hope we get a clearer explanation of the suit Tuesday at the POA meeting - I will be there.


I believe that is your opinion. The lawsuit was sealed, those involved are not allowed to talk about it, right? So what it was about is not clear to me and to anyone who I have talked to.

I think those who don't like the Morses think one way and people like me think another way. People can sue others for a lot of reasons. A LOT of reasons.

[Rags123]

There is a possibility that this is political action by a lawless IRS designed to tie down or intimidate Morse; a big political player on the other side of the aisle. Certainly the IRS under this Justice Department has earned no benefit of the doubt against such speculation.

If so, the whole issue should start winding down over the next couple years.

This is not an accusation I would make at this time for sure. I am not educated enough on this thing, but I do know, the practice in question is not new and the IRS did not say a word until 2009, thus the calendar does support this possibility.

HOWEVER, I have not heard this accusation before, but then I never heard of the others that have been made. Every analysis I have read keeps referring to how gray an area this is, so......

[graciegirl]

This is not an accusation I would make at this time for sure. I am not educated enough on this thing, but I do know, the practice in question is not new and the IRS did not say a word until 2009, thus the calendar does support this possibility.

HOWEVER, I have not heard this accusation before, but then I never heard of the others that have been made. Every analysis I have read keeps referring to how gray an area this is, so......


I agree.

[rubicon]

Why is a lawsuit filed in the county court not open to public information?

The Amenities lawsuit was valid and the only criticism I have for that lawsuit is that it was settled too quickly by taking the first offer. And because it was a class action suit members of the class should have been given an opportunity to voice their opinion.

The IRS Inquiry that followed this lawsuit made some serious allegations concerning the 2003 bond purchase against Villages Lake-Sumter, Inc, The District and the Board members having voting rights. These allegations have not been proven true and I make no claim that they are true.

It appears that District Five and the three plaintiffs feel strongly enough about irregularities here that they felt compelled to file a lawsuit. It is common practice for defendant to denigrate such actions as frivolous.

Residents need to stay very aware of this issue and demand transparency concerning the 2003 lawsuit, the IRS Inquiry and the March 2014 lawsuit. We deserve no less as this is an issue of good faith and ethical handling by Villages Lake-Sumter, The District, the VHA, the POA, the county commissioners who oversee the administration of Sumter county and the Judges we elected to serve our interests and local state representatives

[janmcn]

This is not an accusation I would make at this time for sure. I am not educated enough on this thing, but I do know, the practice in question is not new and the IRS did not say a word until 2009, thus the calendar does support this possibility.

HOWEVER, I have not heard this accusation before, but then I never heard of the others that have been made. Every analysis I have read keeps referring to how gray an area this is, so......


The IRS investigation began in January 2008. If you read deep into this article from Buzzfeed, you will find a very good explanation of the business practices of the developer written in an easy to understand way, not legal mumbo-jumbo.


http://www.buzzfeed.com/likethebreadorthedressing/seven-days-and-nights-in-the-worlds-largest-rowdiest-retirem#cma11w

[graciegirl]

I am very glad that I live south of 466 where the decisions have not been turned over to the residents. I think that the Morses run things better than any place I have ever lived. I also think that a lot of people don't like the Morses because they are very wealthy and also because of their politics.

I had heard that Lake county was never as crazy about The Villages as Sumter is. There are all kinds of unseen forces at work, in my opinion.

[graciegirl]

The lowering of the interest rates paid on the bonds would have saved the homeowners money because the money used to pay the interest comes out of our amenity fees.

I am no attorney but in my opinion I think it would have been more financially prudent to wait till after the lower rate bonds were issued to make a stink.


Bump

[graciegirl]

The IRS investigation began in January 2008. If you read deep into this article from Buzzfeed, you will find a very good explanation of the business practices of the developer written in an easy to understand way, not legal mumbo-jumbo.


http://www.buzzfeed.com/likethebreadorthedressing/seven-days-and-nights-in-the-worlds-largest-rowdiest-retirem#cma11w


It appears to me that this whole article is meant to entertain, and In my opinion, the author strays from reality in several areas.

[Advogado]

There is a possibility that this is political action by a lawless IRS designed to tie down or intimidate Morse; a big political player on the other side of the aisle. Certainly the IRS under this Justice Department has earned no benefit of the doubt against such speculation.

If so, the whole issue should start winding down over the next couple years.
There are several misstatements in this thread about both the first class-action lawsuit and the IRS investigation. For example, the current IRS investigation actually began in January 2008, under the Bush administration, and allegations that it was or is politically motivated have no basis.

To get the facts on both the IRS investigation and the first class action, go to poa4us.org.

[Rags123]

There are several misstatements in this thread about both the first class-action lawsuit and the IRS investigation. For example, the current IRS investigation actually began in January 2008, under the Bush administration, and allegations that it was or is politically motivated have no basis.

To get the facts on both the IRS investigation and the first class action, go to poa4us.org.


I got my information from a Bloomberg article..pretty detailed... written in 2012.....

"The districts were used “to perpetuate this ‘government by developer’ phase indefinitely,” wrote IRS examiner, Dominick Servadio Jr., in a 2009 letter to the Village’s CCD chairman. The May 2012, IRS brief said the agency believed that the 167-acre Village Center CDD and the 432-acre Sumter Landing CDD both failed to meet state requirements to be a district.

n 2009, the IRS requested a settlement requiring the Village Center and Sumter Landing districts to pay $16.5 million tax on the then-outstanding bonds, refinance $355 million of the bonds through taxable bonds, and to refrain from issuing municipal bonds in the future. The settlement was probably declined given the continuing investigation. "

Billionaire Morse Behind Curtain at Villages - Bloomberg (http://www.bloomberg.com/news/2012-06-04/hidden-billionaire-morse-a-man-behind-curtain-at-villages.html)

I saw not mention of January 2008 HOWEVER if Bloomberg erred, I was in error and stand corrected.

Not saying I am right or even Bloomberg, but based on a few posts, I just have to add.....I do trust Bloomberg much more than BUZZFEED on just about any subject :)

[Advogado]

I got my information from a Bloomberg article..pretty detailed... written in 2012.....

"The districts were used “to perpetuate this ‘government by developer’ phase indefinitely,” wrote IRS examiner, Dominick Servadio Jr., in a 2009 letter to the Village’s CCD chairman. The May 2012, IRS brief said the agency believed that the 167-acre Village Center CDD and the 432-acre Sumter Landing CDD both failed to meet state requirements to be a district.

n 2009, the IRS requested a settlement requiring the Village Center and Sumter Landing districts to pay $16.5 million tax on the then-outstanding bonds, refinance $355 million of the bonds through taxable bonds, and to refrain from issuing municipal bonds in the future. The settlement was probably declined given the continuing investigation. "

Billionaire Morse Behind Curtain at Villages - Bloomberg (http://www.bloomberg.com/news/2012-06-04/hidden-billionaire-morse-a-man-behind-curtain-at-villages.html)

I saw not mention of January 2008 HOWEVER if Bloomberg erred, I was in error and stand corrected.

Not saying I am right or even Bloomberg, but based on a few posts, I just have to add.....I do trust Bloomberg much more than BUZZFEED on just about any subject :)

Bloomberg didn't err. The investigation began in 2008. The IRS proposed the settlement in 2009. The whole thing has, incredibly, bounced along ever since and still continues.

[rubicon]

Pure and simple this topic should only focus on the economic affect for residents resulting from the IRS inquiry and this recent lawsuit. It isn't about taking sides and it isn't about right or wrong. Its about bringing the parties to settle all of these disputes to the benefit of residents.

Our amenities are paying for the IRS Inquiry defense and now this latest lawsuit which means that the amenities intent in providing golf maintaining rec centers etc is going to be compromised.

The District and Villages of Lake Sumter actions of claim interest free bonds has placed us in a difficult position. Had they opted properly we would not be dealing with these issues because our facilities would have been defined private creating many more opportunities for residents.

I become considerable concerned about wild accusations and misplaced loyalties. Residents would be wise to view these legal actions as strictly pocketbook issues

[OBXNana]

Pure and simple this topic should only focus on the economic affect for residents resulting from the IRS inquiry and this recent lawsuit. It isn't about taking sides and it isn't about right or wrong. Its about bringing the parties to settle all of these disputes to the benefit of residents.

Our amenities are paying for the IRS Inquiry defense and now this latest lawsuit which means that the amenities intent in providing golf maintaining rec centers etc is going to be compromised.

The District and Villages of Lake Sumter actions of claim interest free bonds has placed us in a difficult position. Had they opted properly we would not be dealing with these issues because our facilities would have been defined private creating many more opportunities for residents.

I become considerable concerned about wild accusations and misplaced loyalties. Residents would be wise to view these legal actions as strictly pocketbook issues


We searched for information about the legal issues in The Villages when we were in the looking stage of buying. We couldn't find information that we clearly understood in non-legal terms and/or without a bias on one side or the other. This may be due to there being no clearly defined lines until the suit is settled. Or, did we just give up and say 100,000 other people have purchased in The Villages and it can't be that bad?

Going back to the OP, it appears to be a different suit than the IRS issue. Is there any place where each of the cases are clearly defined in layman's terms stating only facts? I know this is selfish, but is there a place that clearly defines how different outcomes will personally hit a home owner financially? As home owners, we all are entitled to this information. Past threads have dealt with everything from nothing will happen in my life time to lets hang the developer. It's hard for me to believe that someone a whole lot smarter than I am, hasn't developed a spreadsheet with this information. Or, simply, the unknown is too great to speculate?

[Advogado]

Why is a lawsuit filed in the county court not open to public information?

The Amenities lawsuit was valid and the only criticism I have for that lawsuit is that it was settled too quickly by taking the first offer. And because it was a class action suit members of the class should have been given an opportunity to voice their opinion.

The IRS Inquiry that followed this lawsuit made some serious allegations concerning the 2003 bond purchase against Villages Lake-Sumter, Inc, The District and the Board members having voting rights. These allegations have not been proven true and I make no claim that they are true.

It appears that District Five and the three plaintiffs feel strongly enough about irregularities here that they felt compelled to file a lawsuit. It is common practice for defendant to denigrate such actions as frivolous.

Residents need to stay very aware of this issue and demand transparency concerning the 2003 lawsuit, the IRS Inquiry and the March 2014 lawsuit. We deserve no less as this is an issue of good faith and ethical handling by Villages Lake-Sumter, The District, the VHA, the POA, the county commissioners who oversee the administration of Sumter county and the Judges we elected to serve our interests and local state representatives
I agree with what you say, particularly the need for residents to try to stay informed on this new class-action lawsuit. I feel that the Daily Sun should be ashamed at its burying the story until now.

However, I want to point out that the first class-action lawsuit documents are a matter of public record. There have been frequent posts in this forum by members alleging that they have been sealed. This is simply not true. There is a link to information at poa4us.org. Villagers are not informed about it for two reasons: First, most are not particularly interested. Second, the Daily Sun has under-reported the story and the articles that have appeared have given the Developer's spin.

As to your concern about whether the $43 million settlement was enough to compensate Villagers for the damages they incurred from the Developer's actions, only time will tell. But so far, things seem to be working out okay. The one thing that is clear is that an additional $43 million, that without the first class-action lawsuit would have been in the Developer's pocket, is now available for amenities. We owe the plaintiffs a vote of thanks for that.

Likewise, information on the current class-action lawsuit is a matter of public record: https://www2.myfloridacounty.com/ccm/do/docket?q1=RhzGUFV8UDUxZMo0z5z70w&q2=d501b435bb8ea89f64722f197914ea10
But to actually see the documents, it apparently is necessary to go to the court house since we are not going to get any real information from the Daily Sun. I am certain that somebody will bring this new lawsuit up at the POA meeting tomorrow night, and, hopefully, we will get some enlightenment there. Maybe we can ask the POA to publish a copy of the complaint and answer on its website, since few of us are inclined to make a trip to the courthouse to see them.

[graciegirl]

I agree with what you say, particularly the need for residents to try to stay informed on this new class-action lawsuit. I feel that the Daily Sun should be ashamed at its burying the story until now.

However, I want to point out that the first class-action lawsuit documents are a matter of public record. There have been frequent posts in this forum by members alleging that they have been sealed. This is simply not true. There is a link to information at poa4us.org. Villagers are not informed about it for two reasons: First, most are not particularly interested. Second, the Daily Sun has under-reported the story and the articles that have appeared have given the Developer's spin.

As to your concern about whether the $43 million settlement was enough to compensate Villagers for the damages they incurred from the Developer's actions, only time will tell. But so far, things seem to be working out okay. The one thing that is clear is that an additional $43 million, that without the first class-action lawsuit would have been in the Developer's pocket, is now available for amenities. We owe the plaintiffs a vote of thanks for that.

Likewise, information on the current class-action lawsuit is a matter of public record: https://www2.myfloridacounty.com/ccm/do/docket?q1=RhzGUFV8UDUxZMo0z5z70w&q2=d501b435bb8ea89f64722f197914ea10
But to actually see the documents, it apparently is necessary to go to the court house since we are not going to get any real information from the Daily Sun. I am certain that somebody will bring this new lawsuit up at the POA meeting tomorrow night, and, hopefully, we will get some enlightenment there. Maybe we can ask the POA to publish a copy of the complaint and answer on its website, since few of us are inclined to make a trip to the courthouse to see them.


http://articles.orlandosentinel.com/2008-03-09/news/lvillages09_1_villages-fees-lawyer



All I see is that the developer doesn't seem to have to have his feet held to the fire to keep things painted, in good repair and to improve things around here. I see no evidence of skimping on the things that he builds and outfits such as the rec centers and the magnificent large trees planted down by Brownwood. I cannot get it through my head that he had to be sued to make him do anything .

[rubicon]

I agree with what you say, particularly the need for residents to try to stay informed on this new class-action lawsuit. I feel that the Daily Sun should be ashamed at its burying the story until now.

However, I want to point out that the first class-action lawsuit documents are a matter of public record. There have been frequent posts in this forum by members alleging that they have been sealed. This is simply not true. There is a link to information at poa4us.org. Villagers are not informed about it for two reasons: First, most are not particularly interested. Second, the Daily Sun has under-reported the story and the articles that have appeared have given the Developer's spin.

As to your concern about whether the $43 million settlement was enough to compensate Villagers for the damages they incurred from the Developer's actions, only time will tell. But so far, things seem to be working out okay. The one thing that is clear is that an additional $43 million, that without the first class-action lawsuit would have been in the Developer's pocket, is now available for amenities. We owe the plaintiffs a vote of thanks for that.

Likewise, information on the current class-action lawsuit is a matter of public record: https://www2.myfloridacounty.com/ccm/do/docket?q1=RhzGUFV8UDUxZMo0z5z70w&q2=d501b435bb8ea89f64722f197914ea10
But to actually see the documents, it apparently is necessary to go to the court house since we are not going to get any real information from the Daily Sun. I am certain that somebody will bring this new lawsuit up at the POA meeting tomorrow night, and, hopefully, we will get some enlightenment there. Maybe we can ask the POA to publish a copy of the complaint and answer on its website, since few of us are inclined to make a trip to the courthouse to see them.

Advogardo: You have a reasoned mind. I suspect and with good cause that there is more to all of this than meets the eye. However as I have repeatedly stated bottom line for me is we need to have the parties get to the store because these unsettled issues are well unsettling, distracting and just plain hurtful.

I can tell you that my questioning of the Amenities Lawsuit is done with knowledge of the nature lawsuit. If the Villages of Lake-Sumter, Inc first offered $43 million there was more to be had and a more experienced negotiator would have counter demanded. Enough said.

What has me baffled is where are the irate residents who marched to have the developer "tear down that wall "but remain silent concerning these legal disputes why are they not out with their protest signs, chants and talking to the local papers?

[janmcn]

Advogardo: You have a reasoned mind. I suspect and with good cause that there is more to all of this than meets the eye. However as I have repeatedly stated bottom line for me is we need to have the parties get to the store because these unsettled issues are well unsettling, distracting and just plain hurtful.

I can tell you that my questioning of the Amenities Lawsuit is done with knowledge of the nature lawsuit. If the Villages of Lake-Sumter, Inc first offered $43 million there was more to be had and a more experienced negotiator would have counter demanded. Enough said.

What has me baffled is where are the irate residents who marched to have the developer "tear down that wall "but remain silent concerning these legal disputes why are they not out with their protest signs, chants and talking to the local papers?

IMO, residents are not out protesting because these lawsuits seem like such complicated issues, and purposely so. It is easy to understand a wall, but when one starts talking about bonds, many eyes glaze over.

I, for one, am outraged that our amenity fees are being used to protect the developer's bottom line. Ms Tutt is supposed to report monthly on the amount of money being paid to the attorney. I haven't seen a report for almost a year. Where is it written that this practice is allowed?

This is almost the perfect storm, where the victims get to pay the ransom.

[graciegirl]

IMO, residents are not out protesting because these lawsuits seem like such complicated issues, and purposely so. It is easy to understand a wall, but when one starts talking about bonds, many eyes glaze over.

I, for one, am outraged that our amenity fees are being used to protect the developer's bottom line. Ms Tutt is supposed to report monthly on the amount of money being paid to the attorney. I haven't seen a report for almost a year. Where is it written that this practice is allowed?

This is almost the perfect storm, where the victims get to pay the ransom.

If this isn't the most perfect place in the world to live, then it is very easy to sell and make a profit.

[bimmertl]

If this isn't the most perfect place in the world to live, then it is very easy to sell and make a profit.

Didn't realize until now that if you aren't living in the "most perfect place in the world" you have to love it or leave it. No criticism accepted even if it's factual and warranted.

Apparently a condition of the "silent generation" striving for simplicity and conformity regardless of the circumstances.

[graciegirl]

IMO, residents are not out protesting because these lawsuits seem like such complicated issues, and purposely so. It is easy to understand a wall, but when one starts talking about bonds, many eyes glaze over.

I, for one, am outraged that our amenity fees are being used to protect the developer's bottom line. Ms Tutt is supposed to report monthly on the amount of money being paid to the attorney. I haven't seen a report for almost a year. Where is it written that this practice is allowed?

This is almost the perfect storm, where the victims get to pay the ransom.


THE lawyers are protecting the CDD form of government which I like very much. The money is protecting our way of life here.

[mickey100]

IMO, residents are not out protesting because these lawsuits seem like such complicated issues, and purposely so. It is easy to understand a wall, but when one starts talking about bonds, many eyes glaze over.

I, for one, am outraged that our amenity fees are being used to protect the developer's bottom line. Ms Tutt is supposed to report monthly on the amount of money being paid to the attorney. I haven't seen a report for almost a year. Where is it written that this practice is allowed?

This is almost the perfect storm, where the victims get to pay the ransom.

I agree. It's complex for a lot of people. Others have the mentality that the Developer can do no wrong, so don't want to face the facts that maybe something is wrong with this picture. I feel so fortunate we have the POA look out for our interests.

[janmcn]

According to published reports, the class-action lawsuit filed last March claims "the developer benefitted by illegally using the amenity fees as collateral to issue bonds for community expansion".

All residents of District 5 should plan on attending the POA meeting Tuesday to learn the details of this lawsuit.

[Rags123]

I hope this question is not ignored...I ask in all sincerity and with an upfront admitting that I do not understand it completely. It is very complex and everyone says that. Most articles on the details say it is a very gray area.

I have two questions and do not read anything into these questions...after reading what you folks who have intimately followed this, ......this is what I honestly want to know...

1. In all the years this dispute has been going on, has there been any adverse results in any area of The Villages ? To the amenities or to the homeowners ?

2. I hear a lot about the amenity fee being used to pay lawyers and hoping someone can supply some sort of link so I can see that in print. Not questioning it, but can find nothing at all on that other than a few posts on here.


Thanks to anyone who can answer.

[Cathy H]

I hope this question is not ignored...I ask in all sincerity and with an upfront admitting that I do not understand it completely. It is very complex and everyone says that. Most articles on the details say it is a very gray area.

I have two questions and do not read anything into these questions...after reading what you folks who have intimately followed this, ......this is what I honestly want to know...

1. In all the years this dispute has been going on, has there been any adverse results in any area of The Villages ? To the amenities or to the homeowners ?

2. I hear a lot about the amenity fee being used to pay lawyers and hoping someone can supply some sort of link so I can see that in print. Not questioning it, but can find nothing at all on that other than a few posts on here.


Thanks to anyone who can answer.

After the $43 million suit was settled (without trial) we saw many upgrade and restoration projects get underway using those funds. The developer was gone from the area involved since all his homes were sold, so why would anyone believe the developer would have come back to do these upgrades for free? He is not known to be benevolent.

[graciegirl]

After the $43 million suit was settled (without trial) we saw many upgrade and restoration projects get underway using those funds. The developer was gone from the area involved since all his homes were sold, so why would anyone believe the developer would have come back to do these upgrades for free? He is not known to be benevolent.


Why do you say that? HOW do you see a person as benevolent? What is it that you think the Morses should do????????

[TVMayor]

From the V' News...

Villages bonds earn A+, A ratings despite IRS, lawsuit concerns
September 15, 2014 By Marv Balousek

A lawsuit apparently has stopped efforts by the Sumter Landing Development District to refinance amenity and utility bonds.

In August, The Village Community Center Development District began the process of refinancing millions of dollars in bonds to take advantage of low interest rates. About $88.7 million of these bonds are expected to be sold this week.

But officials of the Sumter Landing District were advised recently that they could not move forward with a similar plan in the area south of County Road 466 due to the lawsuit.

Filed last March by attorney Carol Anderson, the class-action lawsuit claims that the developer benefiitted a decade ago by illegally using amenities fees as collateral to issue bonds for community expansion.

About a third of the current amenities fee budget is appropriated for the debt on about $65 million in bonds that were issued, according to the lawsuit, which claims that homeowners should not be responsible for this debt.

“Permitted uses do not include using subdivision amenities fees to finance a purchase of subdivision assets and thereby create an excessive bond debt,” the lawsuit complaint stated.

A response filed Sept. 12 by attorneys Stephen Johnson and Stephanie McCulloch asked the court to dismiss the lawsuit, calling it “frivilous.”

“There is simply not one factual allegation that the obligations of the developer in the plain language of the declarations were breached in any way,” the response stated.

Plaintiffs in the lawsuit include Community Development District 5 Supervisor and Property Owners Association Vice President Gerald Ferlisi as well as Thomas Burke and Susan Richmond. Defendants are the Sumter Landing District, The Villages of Lake-Sumter Inc. and developers Gary and Mark Morse.

“I have never filed a frivilous lawsuit,” said Anderson, the plaintiffs’ attorney. “They have a duty to be absolutely loyal to the plaintifs and correct these amenity-fee (problems).”

An earlier lawsuit brought by the Property Owners Association resulted in a 2007 settlement in which the developers agreed to pay $40 million over 13 years for repairs and improvements to recreation centers and other facilities in the area north of County Road 466. Gary Morse praised the settlement.

Filing the latest lawsuit was delayed in 2010 because of an Internal Revenue Service investigation into the use of tax-exempt bonds to finance development in The Villages.

n an agreement also signed by Sumter Landing District chairman Michael Berning, the same plaintiffs agreed then to hold off filing the lawsuit. The parties agreed they would extend the statutes of limitations on filing their claims.

Now, the IRS investigation is nearing a conclusion and the dispute could wind up in the courts. The agency has claimed the center district was not authorized to issue tax-exempt bonds because it did not qualify as a political subdivision under the law. A final IRS ruling is expected soon.

Despite the turmoil over the lawsuit and IRS probe, Fitch Ratings recently gave A and A+ ratings to bonds issued by the Villages Center Development District. This week’s bond sale will shift tax-exempt bonds to taxable bonds and could help alleviate the IRS concerns.

[TVMayor]

The way I look at it we the residents have a management department called CDD that oversees among other things maintenance of all that is not privately owned including amenities. This is financed using the amenity fees I pay monthly.

We now have a lawsuit stared by three people (plaintiffs). One of the three is Community Development District 5 Supervisor and Property Owners Association Vice President Gerald Ferlisi. He is a member of the CDD that I pay amenity fees to and he is Vice President of the POA I pay membership to.

As a result of his actions the CDD will spend my amenity fees for attorneys to fight the lawsuit and the POA that represents the residents has a VP that has a lawsuit against the residents he represents. (It is against the residents because they are paying the legal fees.)

I do not think Gerald Ferlisi is fit to represent me in the CDD or the POA, he should resign.

[Advogado]

The way I look at it we the residents have a management department called CDD that oversees among other things maintenance of all that is not privately owned including amenities. This is financed using the amenity fees I pay monthly.

We now have a lawsuit stared by three people (plaintiffs). One of the three is Community Development District 5 Supervisor and Property Owners Association Vice President Gerald Ferlisi. He is a member of the CDD that I pay amenity fees to and he is Vice President of the POA I pay membership to.

As a result of his actions the CDD will spend my amenity fees for attorneys to fight the lawsuit and the POA that represents the residents has a VP that has a lawsuit against the residents he represents. (It is against the residents because they are paying the legal fees.)

I do not think Gerald Ferlisi is fit to represent me in the CDD or the POA, he should resign.
Your position would make sense only if the new class action lawsuit has no basis. If it is as justified as the first class action lawsuit was, we owe Mr. Ferlisi a vote of thanks. However, because of the abysmal reporting by the Daily Sun, none of the posters to this thread, including myself, know whether or not this is the case. Rather than condemn or praise the Plaintiffs at this stage, I think that it would be wise for us to try to learn what is really going on. Hopefully, tonight, at the POA meeting, we can do so.

[janmcn]

The way I look at it we the residents have a management department called CDD that oversees among other things maintenance of all that is not privately owned including amenities. This is financed using the amenity fees I pay monthly.

We now have a lawsuit stared by three people (plaintiffs). One of the three is Community Development District 5 Supervisor and Property Owners Association Vice President Gerald Ferlisi. He is a member of the CDD that I pay amenity fees to and he is Vice President of the POA I pay membership to.

As a result of his actions the CDD will spend my amenity fees for attorneys to fight the lawsuit and the POA that represents the residents has a VP that has a lawsuit against the residents he represents. (It is against the residents because they are paying the legal fees.)

I do not think Gerald Ferlisi is fit to represent me in the CDD or the POA, he should resign.

Mr Gerald Ferlisi does not represent you unless you live in District 5. It is up to the residents of District 5 whether Mr Ferlisi is re-elected.

If you live in Rio Grande, as your address shows, your amenity fee will not be spent for attorneys to fight the lawsuit.

Where is the outrage over the almost one million dollars of amenity fees that have been spent since 2008 trying to protect the developer's bottom line?

Attending the POA meeting is the best opportunity to get accurate information.

[TVMayor]

Mr Gerald Ferlisi does not represent you unless you live in District 5. It is up to the residents of District 5 whether Mr Ferlisi is re-elected.

If you live in Rio Grande, as your address shows, your amenity fee will not be spent for attorneys to fight the lawsuit.

Where is the outrage over the almost one million dollars of amenity fees that have been spent since 2008 trying to protect the developer's bottom line?

Attending the POA meeting is the best opportunity to get accurate information.
So the residents in district one are paying for all the IRS legal cost and the residents of district five are paying zero. But at the same time we have common amenities.

[TVMayor]

The POA VP was a no show at tonight's meeting.

[Advogado]

The POA VP was a no show at tonight's meeting.

He was there; he just didn't say anything about the lawsuit.

In response to a question from the audience, the POA President, pleading pending litigation and a reluctance to casually discuss the matter, read a statement prepared by the attorney for the plaintiffs--which, in my view, did not clarify the matter any more than the Daily Sun article did. HOWEVER, the President did say that the next POA Bulletin would include an article by Plaintiffs' attorney that would explain the situation.

So, I guess we remain ignorant until the POA Bulletin appears in our driveways--unless either (a) the Daily Sun decides to act like a newspaper and reports the facts; or (b) one of us is curious enough to go to the court house and look at the documents on file there.

[TVMayor]

The Florida Government must have sunshine but it is OK if it is partly cloudy at the POA.

[rubicon]

According to published reports, the class-action lawsuit filed last March claims "the developer benefitted by illegally using the amenity fees as collateral to issue bonds for community expansion".

All residents of District 5 should plan on attending the POA meeting Tuesday to learn the details of this lawsuit.

janmcn: Bingo! that's exactly one of the allegations in the IRS action but they went further. It is my personal opinion that the Villages of Lake-Sumter, Inc (VKSI) leveraged buyers money to build The Villages, then continues to sell properties back to residents and at alleged over the market prices. But the kicker is that many of the income producing properties (commercial) are held by VLSI and residents still seem to have no voting rights.

Perhaps I am wrong here and if so please someone call me out because I have no desire to pass along misinformation.

If however these comments have merit it would behoove residents to side with their neighbors and secondly re-consider the misplaced loyalty toward a business entity called VLSI

Finally I wonder why amenities are being used there is perhaps another avenue

[TVMayor]

This is what has happened with the legal battle so far with the exception of 2 lines that got deleted off the bottom of the list do to my computer thinking for it self.

03/31/2014 CLASS REPRESENTATION COMPLAINT WITH EXHIBIT 1 - 3
03/31/2014 CIVIL COVER SHEET

http://i264.photobucket.com/albums/ii199/The_Villages/SumterCourt_zpsc9747f76.jpg

[Advogado]

He was there; he just didn't say anything about the lawsuit.

In response to a question from the audience, the POA President, pleading pending litigation and a reluctance to casually discuss the matter, read a statement prepared by the attorney for the plaintiffs--which, in my view, did not clarify the matter any more than the Daily Sun article did. HOWEVER, the President did say that the next POA Bulletin would include an article by Plaintiffs' attorney that would explain the situation.

So, I guess we remain ignorant until the POA Bulletin appears in our driveways--unless either (a) the Daily Sun decides to act like a newspaper and reports the facts; or (b) one of us is curious enough to go to the court house and look at the documents on file there.
Today's Daily Sun, in an article buried on page C4, reported the dismissal of the new class-action lawsuit. However, thanks to the usual abysmal reporting by the Daily Sun on this very important matter, we still don't have a clear idea of exactly what provoked the lawsuit.

As long as the amenity system functions appropriately, as it seems to be doing now (thanks to the settlement funds from the first class action), it doesn't seem to me that we have a basis to sue the Developer. In other words, I have trouble understanding why the new class-action lawsuit was brought, at least at this time.

However, the underlying issue is the pricing that the Developer uses when selling our amenity facilities to the Center Districts that he controls. If the Developer overprices those facilities (as both the IRS and the first class-action lawsuit allege was done in the past), then our whole amenity system is placed at risk. This is because, as apparently happened prior to the first class-action suit, the Center Districts may be financially unable to both (a) pay the interest on the bonds they sell to raise the money to pay the Developer for our amenities, and (b) continue to furnish our amenities at the agreed-upon level. Hopefully, the POA will be keeping an eye on the details of the sales as they take place.

[Mr.Big]

Wow! Maybe its best that I remain a renter in The Villages. One less thing to worry about!

[Moderator]

This thread is straying into a political arena. Stay on topic, please.

[graciegirl]

Don't worry. There are a great deal more rumors and theories than facts on this thread.

I have lived here now going into eight years and the folks can't explain the IRS investigation into the municipal bonds now, any better than they could when we first moved here.

It seems that TOTV has deleted a lot of posts now, past a couple of years but here is a typical thread.

https://www.talkofthevillages.com/forums/villages-florida-general-discussion-73/latest-development-irs-tax-exempt-bond-investigation-40713/index28.html

I wish EdV would come back on this forum and comment. He may live in Stonecrest, but he was able to understand the issue and explain it better than anyone else in my opinion. There are some that just get exited when anything looks like it would be critical of the developers. I am not one of them.