[Muncle]

Originally Posted by Bogie Shooter

The POA Bulletin hit my driveway today. Usually I would be dissing many of the things written on its pages....I do have a couple of objections...but for another day.
They do comment about the IRS bond issue. To quote a portion...."Again, it is just too early to give a definitive answer, much less even speculate on the outcome. We feel that if there is any potential adverse effect for us, the developer will exercise the same good judgment and concern for the residents that he exhibited in the lawsuit settlement in early 2008 and do what he can to protect this community and its residents. We are hopeful that, if the worst case scenario occurs, the developer will do the right thing for the residents. And we encourage residents to support the efforts of the developer and the VCCCD to resolve any issues." (note: my underlining)
A new position of the POA, no wild speculation or finger pointing and asking residents to support the developer.
A welcome change at least on this issue from the POA!

Considering my general antipathy toward the POA, this has been a very difficult post to write. In fact, during my first attempt, my computer froze up and I lost everything. So, I try again.

Congratulations to the POA and its officers for putting out such a reasonable and timely notice in their bulletin. What you have done this day is a real service to your members and residents in general.





`

[Boomer]

Originally Posted by Muncle

Considering my general antipathy toward the POA, this has been a very difficult post to write. In fact, during my first attempt, my computer froze up and I lost everything. So, I try again.

Congratulations to the POA and its officers for putting out such a reasonable and timely notice in their bulletin. What you have done this day is a real service to your members and residents in general.
`

I have been reading this thread as somebody from the outside looking in. Still learning. And I have to tell you, Munc, that when I saw this post from you about the POA, I read it 3 times. I thought I was missing something between the lines.

I know this had to be a tough one for you. You're a big man, Munc.

And now a question of protocol, copyright, or whatever: Does the POA bulletin appear on line, and if so, would it be appropriate to post this issue here?

Boomer

[dillywho]

Originally Posted by squeek

Has anyone thought about this (or am I late to the party?).

The developer sells bonds to finance infrastructure. Assume the actual cost of the infrastructure is several million dollars less than the bond issue total (which seems to be the case in the recent Sentinel article).

The obligation to repay the bond holders is transferred to the property owners through the amenity fee assessment.

What happens with the excess millions not used? Maybe this is part of the IRS's concern as well as the tax-exempt status. In any event, I am interested in learning where the flow of excess funds finally end.

Village Homeowner

I thought the bond repayment was tied to taxes and not the amenity fees. Does anyone know which way it is for sure? I know mine always shows up on my tax bill since we didn't pay it up front.

[starflyte1]

dillywho, there are two different types of bonds. The one you mention and came with your home when it was built and THE other: the developer sells amenities to the CDD and that payoff of bond is in your amenity fee.

Boomer, The POA has a very good web site with all of their past bulletins archived. It is POA4us.org. I found that web site many years ago and have learned a lot reading it. The POA made me very aware of what we were buying when we just bought in December, and decided regardless of what was going on with the sale of amenities to the CDDS, it would still be a nice place for us to live.
We just lowered the price we were going to pay for a home in case it comes back to us.

[JimJoe]

Originally Posted by dillywho

I thought the bond repayment was tied to taxes and not the amenity fees. Does anyone know which way it is for sure? I know mine always shows up on my tax bill since we didn't pay it up front.

I thought:
1. What most people call "the bond" (such ast 20,000 on a new house) is to pay for the initial cost of infrastructure and it is based on the length of the frontage of your property on the street so a villa is cheaper than a ranch; The total cost of infrastructure divided by all taxable frontage gives the cost per foot, then times the width of your lot equals your bond. The bond is higher for the newer villages because the cost of construction ( or improved or additional infrastructure) is higher.
2. The annual cost of maintenance called the cdd bond is to maintain part of that infrastructure, that amount varies from cdd district on an annual basis; Does anyone know how repairs for the street or the utilities in front of your house are paid for. Is there a special assessment to your personal property tax bill?
3. The amenities fees is your monthly bill to pay for the cost of maintaining pools, golf courses etc (and now I believe also to pay off a separate bond that is sold for the purchase of the land and the pool or golf course(for example) (Is this the tax free bonds referred to in the IRS preliminary ruling? ). Is that right? I sure wish this was clearer.

[dillywho]

Originally Posted by starflyte1

dillywho, there are two different types of bonds. The one you mention and came with your home when it was built and THE other: the developer sells amenities to the CDD and that payoff of bond is in your amenity fee.

Boomer, The POA has a very good web site with all of their past bulletins archived. It is POA4us.org. I found that web site many years ago and have learned a lot reading it. The POA made me very aware of what we were buying when we just bought in December, and decided regardless of what was going on with the sale of amenities to the CDDS, it would still be a nice place for us to live.
We just lowered the price we were going to pay for a home in case it comes back to us.

Thanks for the clarification. That makes it easier to follow what is going on.

[downeaster]

This thread has 125 posts and 7,569 views. It is obviously of great interest to Villagers and Wannabes.
Lauren Ritchie clarified her position by immediately posting here.
Does anyone think the VCDD and/or Developer will clarify their position?
Do we not deserve some response so we may know what to expect from them?
I can't help but think they monitor this forum. What better place to keep their finger on the pulse.
The Villages Daily Sun will not touch this subject without a green light from their owner.
If we hear from the HOA it will probably be in the defense of the VCDD/Owner position.
The POA has made an intelligent statement but you can bet they will have more to say as time goes on. They have their finger on the pulse.

[Bogie Shooter]

Originally Posted by downeaster

This thread has 125 posts and 7,569 views. It is obviously of great interest to Villagers and Wannabes.
Lauren Ritchie clarified her position by immediately posting here.
Does anyone think the VCDD and/or Developer will clarify their position?
Do we not deserve some response so we may know what to expect from them?
I can't help but think they monitor this forum. What better place to keep their finger on the pulse.
The Villages Daily Sun will not touch this subject without a green light from their owner.
If we hear from the HOA it will probably be in the defense of the VCDD/Owner position.
The POA has made an intelligent statement but you can bet they will have more to say as time goes on. They have their finger on the pulse.

What is it you want them to say at this point in time? Would you want a brief outline of what their response will be to the IRS? Come on, get real.

[JimJoe]

Originally Posted by Bogie Shooter

What is it you want them to say at this point in time? Would you want a brief outline of what their response will be to the IRS? Come on, get real.

Yes I would like that. Is that top secret information? Don't you think the people who pay the bills have a right to know? We are REALly interested.

[Cassie325]

Originally Posted by JimJoe

Yes I would like that. Is that top secret information? Don't you think the people who pay the bills have a right to know? We are REALly interested.

I would imagine they are relying on their attorney's to work this out with the IRS. This is a legal issue and I wouldn't think anyone would comment until the facts are all available.

There are always two sides to everything. I think we should wait to see what the IRS's final decision is before getting so angry.

I also can't imagine the District charging anymore money to make up for any "mistake" they may have made.

The District and the Developer have been doing this for a long time. They have the residents interest at hand and heart....because it is the residents they pay the bills! The last thing they want to do is upset the residents!!


JMO

[downeaster]

Originally Posted by Bogie Shooter

Come on, get real.

This type of response to a post is uncalled for.

[Phoebeis]

Well, I'm confused. If you buy a pre-owned home and it is stated that the bond is paid, do you have another bond on top of that??????? Phoebeis

[starflyte1]

Pheobeis, Yes there is another type bond that is paying for amenities such as golf courses, bought by the CDD from the developer.

[thunderbolt]

I agree Downeaster,,Bogie Shooter are you the poster child for sarcasm and meanness on this forum?? What are you so grumpy about? Don't you know this is Floridas Friendliest Hometown or at least I thought it was.

[katezbox]

Please forgive my not "quoting" here - but there seems to be a lot of confusion on what a bond is and isn't and who gets taxed in relation to them - leading to some confusion and even a touch of panic.

Issuance of bonds is one way a business can raise capital. Investors buy bonds (each is usually priced at $1000) with a given interest rate. The issuer pays the interest rate to the bond holder over a time period (usually 10 - 30 years). To the bondholder, this interest is income that can be spent or invested.

Some bond interest is taxable; some interest is not. What makes a bond tax exempt is usually that it is being issued by a municipality or by an organization that is acting in a way that directly benefits the American people. For example, a water utility can issue tax exempt bonds to expand water service - even if that utility is a for-profit organization. This allows sellers of bonds that meet that criteria to raise money at a lower cost than a public company.

Why would someone buy a bond with a lower rate? That's where the tax-exempt portion comes in. If as a taxpayer you are paying 20% in income taxes, you might be better off with a 4% tax-exempt bond than a taxable bond at 4.9% (where after taxes you would only earn 3.92%). Also, tax exempt bonds are frequently viewed as having lower risk since so many are issued by government entities.

It is not the developer or Villagers who would pay tax if these amenity bonds are found to not be tax-exempt. It is the holders of those bonds. Where our risk as Villagers is if the sale of these bonds was deemed to be fraudulent and the bonds recalled.

I have participated in the issuance of bonds and can tell you that developers can't simply "decide" that they will be tax exempt. The IRS usually must issue a determination of their opinion.

In this case, the developer financed the building of amenities within the Villages with these bonds. He also made a profit selling those amenities to the CDD. I do ROI analysis for a living. This is NOT Bernie Madoff. Developers would never develop if there was no profit in it.

Steve from NY - you are right on. I'll see ya' at the Square in April. I will monitor this situation as an investor in my Villages home - but like Russ_Boston and Muncie also state - one article is not getting the full picture.

With apologies for my soapbox (and finance class)

Kate