[PennBF]

I could not have said it better. Although the Mores'e may be wonderful people and have done a great job in constructing a community the question remains as to whether they became weathy based on sound accounting practices or they bent the rules to maximize profit to them and now the residents are being hung out to dry. Judging from the input from the IRS it would appear the "residents are being hung out to dry". I continue to be amazed at some favoring a dictorship rules rather than a demoncratic vote by the people for representation. I thought the men and women who fought and died to protect our form of government meant something. Because the Morses have done a great job of building a community does not mean I would give up my form of government. Remember: Absolute Power Corrupts. Through a unique series of laws there is a family who controls the purse strings for over 100K residents by contolling appointments, etc. That is not a democratic form of government that some have given their lives for and I for one continue to believe in our democratic form of government.

[njbchbum]

Originally Posted by PennBF

I could not have said it better. Although the Mores'e may be wonderful people and have done a great job in constructing a community the question remains as to whether they became weathy based on sound accounting practices or they bent the rules to maximize profit to them and now the residents are being hung out to dry. Judging from the input from the IRS it would appear the "residents are being hung out to dry". I continue to be amazed at some favoring a dictorship rules rather than a demoncratic vote by the people for representation. I thought the men and women who fought and died to protect our form of government meant something. Because the Morses have done a great job of building a community does not mean I would give up my form of government. Remember: Absolute Power Corrupts. Through a unique series of laws there is a family who controls the purse strings for over 100K residents by contolling appointments, etc. That is not a democratic form of government that some have given their lives for and I for one continue to believe in our democratic form of government.

there is nothing in life more important that the men and women who fought and died to protect our form of government...and our opportunity to always have the freedom of choice...some of us just prefer to choose the current form of govt in the villages to one that is more akin to our right to vote for the individuals most likely to screw things up.

[mickey100]

Originally Posted by PennBF

I could not have said it better. Although the Mores'e may be wonderful people and have done a great job in constructing a community the question remains as to whether they became weathy based on sound accounting practices or they bent the rules to maximize profit to them and now the residents are being hung out to dry. Judging from the input from the IRS it would appear the "residents are being hung out to dry". I continue to be amazed at some favoring a dictorship rules rather than a demoncratic vote by the people for representation. I thought the men and women who fought and died to protect our form of government meant something. Because the Morses have done a great job of building a community does not mean I would give up my form of government. Remember: Absolute Power Corrupts. Through a unique series of laws there is a family who controls the purse strings for over 100K residents by contolling appointments, etc. That is not a democratic form of government that some have given their lives for and I for one continue to believe in our democratic form of government.

[Mikeod]

Originally Posted by mickey100

Good question, but here's the way I see it. Had the bonds issued been taxable bonds, they would have cost the borrowers less than nontaxable bonds, assuming they both had the same coupon rate. We'd have to go back in time and see the bond prices at the time of bond issuance to see exactly the spread between taxable and non-taxable bond prices. Anyways, the developer would have had to sell more bonds to obtain the same amount of money, so he would have paid a similar amount of interest. Not to mention there may have been additional tax writeoffs, depreciation etc., to be considered. I am no bond expert, and neither I expect are you, but we both know bond issuance and underwriting, etc., is complicated.

My chief complaint has been that the developer was warned back in 2003 about the legalities of the bond issuance, and he continued to do so. Here's what W. Mark Scott, director of the IRS' tax-exempt bond division, wrote to the district on Jan. 29, 2003, when the bonds got a thumbs up after an earlier audit.

"Our closing of these cases, however, should not be construed as an approval of your method of operations. We have concerns regarding: the amount of control the developer has over the issuer; the questions of value of the assets sold by the developer to the issuer as these are not arm's length [transactions]; the treatment of income and expenses (whether income is properly reported and expenses deducted only once); compliance with state law."

Please note above , the IRS said directly that they had concerns with the developer's compliance with state law. I'm sorry you don't like my term "dancing around the law" but when they were warned and continued to push the limits of the law, so be it.

Now, many years later, if the bonds have to be re-issued and we the residents have to pay the IRS penalties, we are concerned about the financial consequences to The Villages and our amenities.

Couple of things.

The developer most assuredly has a staff of legal and tax people at his disposal. I would expect their advice to him was that the bnd issue was legal and proper. The IRS expresses some concern but closes the case. Don't forget the IRS is a department that tells taxpayers to come to them for advice on their tax returns, but, if the advice they give is faulty, the taxpayer owes the tax plus interest and penalties. I don't have such confidence in the IRS that I would automatically assume everything they say is 100% accurate. I suspect Morse went back to his advisors and had them review the issue and was told it was proper. Regarding state law, I remember the IRS has in their recent (last few years) review made statements that indicated they did not understand the CDD form of governance as established in Florida.

I would not say I'm completely comfortable with the CDD situation either. It seems that efforts have been made to further dilute the ability of the residential CDDs to have any say in finances especially with regards to the Project Wide funding. However, might this also somewhat shield the residents in this IRS dispute? The dispute is nominally between the central districts and the IRS. The amenities fee is capped by CPI. So the risk to us is the central district having to deplete its funds to pay the government or the bondholders or ??? and the effect that may have on maintaining the amenities to the level we are accustomed. I don't see any way the residents are on the hook for the total that may be due.

The Morse family has created a wonderful community here through some risk and hard work. They do not appear to me to be the type that would sit back and let the community go down the drain by allowing the amenities to deteriorate. They still have significant investments in this community, and they live here as well. Yes, you can sell the commercial property, the real estate office, and the championship golf courses. But the negative publicity of the residents being cheated out of the lifestyle they bought into while the family bolts for greener pastures would assuredly cut into the selling price. Truth is, they can likely make much more money by keeping this place up to the usual standard.

But I agree we need to be alert and aware.

[villagerjack]

"Good question, but here's the way I see it. Had the bonds issued been taxable bonds, they would have cost the borrowers less than nontaxable bonds, assuming they both had the same coupon rate."

WHERE DID YOU GET THAT FROM? TAX FREE BONDS ALWAYS HAVE LOWER COUPON RATES OF INTEREST FOR SIMILAR RISKS.

"We'd have to go back in time and see the bond prices at the time of bond issuance to see exactly the spread between taxable and non-taxable bond prices. Anyways, the developer would have had to sell more bonds to obtain the same amount of money, so he would have paid a similar amount of interest."

NOT SURE HOW YOU ARRIVED AT THAT CONCLUSION. THE SAME DOLLAR AMOUNT OF BONDS WOULD HAVE BEEN SOLD WHETHER THEY WERE TAXABLE OR TAX FREE. IN ADDITION, THE DEVELOPER DID NOT ISSUE THE BONDS, HE RECEIVED THE PROCEEDS FROM THE BONDS.


"Not to mention there may have been additional tax writeoffs, depreciation etc., to be considered."

NOT SO FOR REASONS CITED ABOVE

[djl8412]

[quote=Peachie;690167][QUOTE=mickey100 I'm looking forward to the article in the Orlando Sentinel Wednesday which will cover possible consequences of the IRS ruling.

Of course, you are Mickey, I would be surprised if you weren't. (Bigger sigh here.)


djl8412, "If you feel that by someone taking over running this place after being elected by residents instead of being hand-picked then many of us will be glad to help you pack."


djl8412, wear comfortable shoes to help people pack because there will be a bigger exodus than you think if The Villages is run by "elected residents". Talk to people and see what they think of your idea of elected residents to change what we now have in The Villages.

PennBF:

It is absolutely astonishing that anyone would wish for and want to be governed by a "non elected" person over representation by persons elected by the people. It is impossible to discuss this since it is so foreign to what we all stood for and fought for. It is totally possible that we as resident will be assessed in the thousands of dollars because of a failure to apply the proper accounting system taxable controls. Enough said.


PennBF, this is exactly what people have stood and fought for... the RIGHT to live in a community of this caliber with this type of representation that we desire. I understand that some people would not want this type of representation and there are so many communities from which they may choose, they would not be happy living here. Good luck to them.

Nitehawk, IMHO, Lauren Ritchie doesn't strike me as the kind of person who would laugh.[/quote]

WOW!!! So much to digest but all missing the most important point: Let the residents determine their fate instead of a hand-picked few behind closed doors. Yes, there would be outcomes that many would not like which we always endure through life. I don't recall EVER standing and fighting for the right to live in a community of this caliber but we did move here of our own free will and our own free will also includes the right to choose how we are governed instead of NO CHOICE. I have plenty of comfortable shoes and most important of all............I can choose which pair I wear. not someone else.

[djl8412]

Originally Posted by perrjojo

Perhaps you are astonished because you have not lived in a neighborhood where the board was elected by the residents and the elected board did not have the qualifications or foresight to govern anything. It can become a big mess with pet projects and no foresight for the future. Then the good ole boy system really kicks in and things can go to pot quickly. I speak from previous experience. As another poster has said, "be careful what you wish for.

Were these private, gated communities such as homeowner associations?

[djl8412]

Originally Posted by villagerjack

The "non-elected" person has done a fine job preserving the rights if ALL residents to utilize the amenities on an equal and unfettered basis. Once in the hands of 'elected" people, power groups tend to form which can violate the unfettered right to access facilities, particularly for snowbirds who spend only limited time in The Villages. I have experienced this first hand. Please read my prior post in answer to Gracie.

ALL residents????

[Mikeod]

Originally Posted by djl8412

ALL residents????

OK, elaborate. What residents or group of residents is not given the right to access the amenities?

[villagerjack]

Originally Posted by mikeod

OK, elaborate. What residents or group of residents is not given the right to access the amenities?

Just one instance which applied to tennis. Similar things were done with Pickleball, Croquet, Swimming etc. In a former over 55 gated community built by Dell Webb, Tennis Teams were formed by full time residents. They joined USTA and other groups playing tennis all year long, each group with a different season. If you were not a permanent resident you could not break into the various teams. Players joined 3-4 teams, played in Tournaments frequently and CLOSED THE COURTS TO RESIDENTS during the frequent tournaments. Also closed them for practice sessions for Tournaments, etc etc. There was OPEN TENNIS for all residents in the morning ( come and play)which they also tried to take over. When they met some resistance they changed the hours to 7AM. We played in the cold with LIGHTS in the winter. I could go on but you see what can happen under resident control. The Morses do not let this happen here.

[mickey100]

Originally Posted by mikeod

Couple of things.

The developer most assuredly has a staff of legal and tax people at his disposal. I would expect their advice to him was that the bnd issue was legal and proper. The IRS expresses some concern but closes the case. Don't forget the IRS is a department that tells taxpayers to come to them for advice on their tax returns, but, if the advice they give is faulty, the taxpayer owes the tax plus interest and penalties. I don't have such confidence in the IRS that I would automatically assume everything they say is 100% accurate. I suspect Morse went back to his advisors and had them review the issue and was told it was proper. Regarding state law, I remember the IRS has in their recent (last few years) review made statements that indicated they did not understand the CDD form of governance as established in Florida.

I would not say I'm completely comfortable with the CDD situation either. It seems that efforts have been made to further dilute the ability of the residential CDDs to have any say in finances especially with regards to the Project Wide funding. However, might this also somewhat shield the residents in this IRS dispute? The dispute is nominally between the central districts and the IRS. The amenities fee is capped by CPI. So the risk to us is the central district having to deplete its funds to pay the government or the bondholders or ??? and the effect that may have on maintaining the amenities to the level we are accustomed. I don't see any way the residents are on the hook for the total that may be due.

The Morse family has created a wonderful community here through some risk and hard work. They do not appear to me to be the type that would sit back and let the community go down the drain by allowing the amenities to deteriorate. They still have significant investments in this community, and they live here as well. Yes, you can sell the commercial property, the real estate office, and the championship golf courses. But the negative publicity of the residents being cheated out of the lifestyle they bought into while the family bolts for greener pastures would assuredly cut into the selling price. Truth is, they can likely make much more money by keeping this place up to the usual standard.

But I agree we need to be alert and aware.

Clarification - When I said the "we the residents" would pay the financial penalties, I meant that the CDD which we pay into and which controls our amenities, would be paying, and our amenities would possibly suffer. I do agree that the Morses have built a wonderful community, and we all enjoy the lifestyle. I do have concerns though, based on their past history (remember the lawsuit filed against them some years ago), of whether or not they will step up to the plate and make things right if the need arises. With so much money at stake, its not in my nature to sit back with my head in the sand and "trust" a Developer to take care of things. I agree with your statement - we need to be alert and aware.

[villagerjack]

I should point out that wnen Del Webb was in control, this did not happen. When residents were elected, the special interest groups took over, effectively shutting out smowbirds. We then bought in TV. I still own that home. It would sell for about $120/s/f. My home here $200/s/f. After 18 years they still have not sold out and Amenities not completed. Morse builds them first. Effectively Locking out Snowbirds by hogging amenities was not a good move. For the last few years, they sold less than 10 homes a month. This was the result of "electing" people to the board. I did not fight in the military to have my rights usurped by elected officials but it happened.

[Mikeod]

Originally Posted by villagerjack

Just one instance which applied to tennis. Similar things were done with Pickleball, Croquet, Swimming etc. In a former over 55 gated community built by Dell Webb, Tennis Teams were formed by full time residents. They joined USTA and other groups playing tennis all year long, each group with a different season. If you were not a permanent resident you could not break into the various teams. Players joined 3-4 teams, played in Tournaments frequently and CLOSED THE COURTS TO RESIDENTS during the frequent tournaments. Also closed them for practice sessions for Tournaments, etc etc. There was OPEN TENNIS for all residents in the morning ( come and play)which they also tried to take over. When they met some resistance they changed the hours to 7AM. We played in the cold with LIGHTS in the winter. I could go on but you see what can happen under resident control. The Morses do not let this happen here.

I thought the post referred to TV residents. Sorry if I misinterpreted it. I don't disagree with the point that resident control may not be an improvement.

[mickey100]

[quote=djl8412;690455]

Originally Posted by ;690167

WOW!!! So much to digest but all missing the most important point: Let the residents determine their fate instead of a hand-picked few behind closed doors. Yes, there would be outcomes that many would not like which we always endure through life. I don't recall EVER standing and fighting for the right to live in a community of this caliber but we did move here of our own free will and our own free will also includes the right to choose how we are governed instead of NO CHOICE. I have plenty of comfortable shoes and most important of all............I can choose which pair I wear. not someone else.

djl8412, I like your spunk!

[rubicon]

Some folks seem to forget that TheVillages hold better than 100,000 residents many of whom have very impressive credentials meaning that we will have an internal market to select from when the time comes due.

In my mind the first order of business is ultimately who will be found to have the legal/financial obligation should the IRS prevail with the sub-political status action.

Secondly would be the financial amount of that financial obligation and penalities and fees and the question of who is ultimately holding the bag on the monies to defend this action.

Next is the the manner of the payout.

following this is the affect this case has on the continual buildout.

By the way there apparently is an argument that the Developer at least held this project together given the previous concerns about places like Del Web.

Again I am confident that this is all going to work out