THE POA BULLETIN November 2005

The Sumter Landing central district (the SLCDD) announced a pending purchase of common properties and related financial assets from the developer for $60.7 million.

This is the first of the common property purchases in the SLCDD administration area south of highway 466. More purchases are expected in the years ahead as the developer sells additional recreation facilities and utilities to the SLCDD in similar transactions.

The technique used now is equivalent to that used before. Bonds will be issued to raise the money to immediately pay the purchase price to the developer. The bonds are then paid off over 33 years out of the monthly amenity fees paid by residents. The bond’s effective interest rate is pegged at approximately 5.3% on a tax-free basis. The principal amount is before the interest which could double the payback over the 33 years.

In the VCCDD administration area north of highway 466, developer sales like this have amounted to approximately $1 billion over the previous 15 years of the VCCDD’s existence. Debt service there now accounts for about 60% of the monthly amenity fee.

The physical assets in the SLCDD transaction include: 13 recreation centers, 8 postal stations, 5 security facilities, 3 miscellaneous facilities, and the three executive golf courses at the Belvedere facility. The value of the transferred assets is not yet available, but the POA estimates the current value at roughly $12-$15 million on the books of the developer. These physical assets form the basis for an income-approach appraisal of the developer’s business in developing this area as presented in the paragraph just below.

The financial assets include the 6,603 amenity fee contracts from homes closed through October, 2005. The developer is assigning these to the SLCDD for collection in the years ahead. These amenity fee

contracts were identified by the Fishkind & Associates consulting group in the income-approach appraisal as having a net present value of approximately $63.0 million.

The $63.0 million valuation is based on the net present value of the amenity fee contracts. The physical assets justify the amenity fee contracts and are included in the deal at no additional charge.

The total transaction price is now pegged at $60.7 million. Thus, the SLCDD is receiving a slight discount of $2.3 million to the appraised valuation of $63.0 million.

The “Pros” of this Transaction

1. This keeps the recreational facilities under the management of a central CDD government dedicated to providing and maintaining these facilities for the benefit of residents. This avoids having these facilities in the hands of another company that may not have the mission of managing the facilities for the residents’ benefit.

2. This is a “Way Out” or “Exit” for the developer that allows him to harvest profit for his developmental efforts to build attractive facilities in The Villages. If an “Exit” opportunity for the developer were not available, or if he were stuck with the facilities forever, he would be reluctant to invest in building these great Villages facilities.

3. The purchase is paid for out of the amenity fees that we all agreed to pay when we moved here. No additional assessments are required to accomplish this transaction.

The “Cons” of this Transaction

1. This is a conflict-of-interests because the developer-appointed supervisors in the SLCDD agreed to this transaction with the developer. In situations like this, supervisors may not be able to exercise independent judgment in an arms-length negotiation or due-diligence process. Because the supervisors are appointed by the developer, we question whether the residents, who will have to pay the price, were fairly represented.

2. It doesn’t look like there was any negotiation on the price, which appears to be much too high. The price should reflect business risk; this may not have been recognized properly. The $2 million discount is much too small to properly reflect this.

3. Residents had no say in this transaction even though we will have to pay off the bonds over the next 33 years. There was no referendum that would allow voters to voice their opinions. Nor have residents been able to vote in any election for the supervisors who agreed to the developer’s price. This is the Taxation Without Representation issue that the POA has often talked about.

4. This transaction precludes any decrease in the amenity fees over the next 33 years because amenity fees are pledged for the payoff of the 33-year bonds.

5. This deal obligates us to pay again for the facilities that we thought were part of the higher prices we paid originally for our lot and house. Didn’t you think that the higher price charged to buy into The Villages was because of the cost of these wonderful facilities? It is interesting to note that the local county appraisers office also thinks that is the case.

In Conclusion – The Bottom Line

The Villages is a wonderful place in which to live, and the facilities are first-rate. But, have no illusions about it, we are paying dearly for what we have here. Furthermore, we don’t have any say in decisions like this. And, it feels like we are paying twice for what we have here.

But, it’s a beautiful day in The Villages! And, the developer would say to just sit back and enjoy it!

Come to the POA Holiday Party on Wednesday, December 21st, at our regular meeting at the Saddlebrook Rec Center. Members will not have to bring in food dishes this year. We have Ollie’s coming with frozen custard, and we will have special Christmas cookies. Should be fun with none of the messy clean-up. See you there!

We noticed in the November issue of The Villages Magazine that Mr. Pete Wahl was asked about which of his accomplishments he was most proud.

Mr. Wahl responded: “I guess my biggest sense of pride is seeing the transition from landowner boards to boards of residents taking over and being responsible for operating governmental units.” Mr. Wahl was talking about the residential CDDs in which residents eventually elect the supervisors rather than having supervisors appointed by the developer.

Mr. Wahl is right – this is a significant accomplishment – supervisors elected by residents making the operating decisions in their governments. This is good representative and democratic government.

So, we would ask Mr. Wahl, why isn’t this also a good idea for the VCCDD and the SLCDD? Wouldn’t it be a good idea to have residents also making all the important decisions in these central districts that effectively run the show in our community? As it now stands, these supervisors are basically appointed by the developer.

Unfortunately, Mr. Wahl will duck this question. He really doesn’t want residents making these big and important decisions. Actually, he likes the status quo. That is because he is also appointed by, and serves at the pleasure of, the developer.

So, Mr. Wahl must be proud of the VCCDD and the SLCDD supervisors being appointed by the developer.

And, he is probably thankful that his job is to serve at the pleasure of the developer. That is a nice job if you can get it – and, no worries about being elected by residents – or, thrown out by residents. Nice job....

The VHA newspaper, the Villages Voice, prints summaries of the various residential CDD meetings in each issue.

In its November, 2005, issue, it reported on the meetings of CDD#1 and CDD#2 and CDD#3 and CDD#5.

It is interesting that in that meeting Irving Yedwab, a director of the POA, and very much interested in the Nancy Lopez pond sinkhole issue, spoke about the legal issues. He reasoned that the “Hold Harmless Agreement” relied upon by the developer was unenforceable in court, and the developer should pay most if not all of the cost to repair the sinkhole on his golf course. Mr. Yedwab was given a standing ovation by CDD#4 residents at the meeting for his analysis.

Could it be that the VHA didn’t want to publicize a Residents’ Rights issue that the residents of CDD#4 are vitally interested in?

Could it be that it didn’t want to publicize an issue that is potentially embarrassing to the developer?

Could it be that it didn’t want to publicize the POA’s advocacy of Residents’ Rights?

Guess who loses – it’s the residents of CDD#4 and all Villages residents that lose.

If the VHA is going to be a homeowners’ association, it has to openly support important homeowners’ issues. We should not tolerate any of the Daily-Sun-type-censorship that is a thorn in the side of our community.

And, we should not tolerate a VHA that stonewalls and avoids the important issues.

We noticed that the developer has agreed to match up to $100,000 of the funds collected by the VHA for Hurricane Katrina relief for the sister city of The Villages.

We view this as a noble purpose and we applaud the VHA and the developer for their thoughtfulness on this hurricane relief effort.

However, we can’t help noticing that the $100,000 is about the same amount that the developer has refused to pay for the Nancy Lopez pond sinkhole repair. The POA estimated the developer’s responsibility at $120,000 and he has paid thus far just about $16,000 – or $104,000 short.

We commend the developer’s benevolence for a worthwhile cause. But, it surely would be nice to see the developer’s benevolence start closer to home – like in our own backyard for residents of our hometown in The Villages. Where we come from, you take care of family first. Didn’t your mother used to say that charity begins at home?

The following is a schedule of Senator Carey Baker’s office closing in The Villages while he and his staff are in Tallahassee for Committee Weeks and Legislative Session. His constituents can get assistance during this time by calling the Eustis office at 742-6490. If the constituents live outside of Lake County, they can call 1-888-567-5577 for assistance.

Mr. Pete Wahl has again said “BAH HUMBUG” for the Christmas Parade.

Ms. Eleanore Mollenhauer, the president of the German American Club here in the Villages, worked hard last spring to arrange for the return of the annual Christmas Parade.

Eleanore conducted a survey at several Villages clubs gathering almost 1000 votes. When asked if they supported the return of the Lions Christmas Parade and the Christmas decorations displayed in previous years, every person responded “yes.” No one voted “no” or “bah humbug” in the entire group.

Eleanore reported the results of the survey to the VCCDD Board of Directors and Mr. Wahl at the April monthly meeting. We were encouraged to hear at the April VCCDD meeting that Mr. Wahl was planning to talk with the Lions Club in the hopes of bringing back the Christmas Parade.

At the June VCCDD meeting Mr. Wahl announced that there would be two Christmas Parades this year, one at the Town Square and one at Sumter Landing. Eleanore and everyone were happy to get this good news.

The good news from Mr. Wahl and the VCCDD board, however, proved to be short lived. At the November VCCDD board meeting, Mr. Wahl said that there would be no Christmas Parade. When Mr. Wahl was asked why he mislead us in the earlier months, he had no answer.

Evidently Mr. Wahl knows what is best for the people in the Villages and does not respect Resident’s Rights. He and the VCCDD Board, time and again, act like a dictatorship.

This is another example of a decision made by Mr. Wahl, or someone in power here, without talking to residents beforehand. It is as if our opinion doesn’t count.

Mr. Wahl says that there is no staging area for the parade line-up before the start. This is bunk -- Avenida Central could easily be used for the staging area.

Mr. Wahl also says that the parade is too long. This is also bunk. The Lions club offered to cut down the length of the parade to conform to Mr. Wahl’s standards.

It is obvious that Mr. Wahl doesn’t want the parade, so he decided to cancel it.

If he really wanted to have the parade he certainly could have found a way to overcome his concerns about staging and time.

It is obvious that Mr. Wahl has no regard for the wishes of residents and that he considers himself powerful enough to squash our desires for the parade. There is no appeal. Our grandkids will be disappointed. All because Mr. Wahl is a scrooge. Bah Humbug.

The POA is appealing to all residents, organizations, and clubs in The Villages (including the VHA) for help in the resolution of this Residents’ Rights issue, or at least to voice your opinion and take a stand.

You, the residents of The Villages, can help today by supporting this POA position.

Any person living in a democracy would like to think that numbers count and their voice can be heard. Why isn’t it like that here in the Villages?

Mr. Wahl has since announced that instead of the Christmas Parade this year, we will have a Christmas Stroll. A Christmas Stroll?? What’s that?? Does Santa Claus stroll?

Listed here are letters sent by Elaine Dreidame, a POA Director, to Pete Wahl and Monica Andersen:

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To Mr. Pete Wahl:

Every Thursday in “Pete’s Place” you remind us that attendance at District Government School “¼should be required attendance for everyone moving to The Villages.” I have attended several times and have found it useful in beginning to understand CDDs and how they work.

We all know that buying a home in The Villages is often done via short visits. Attendance at the District Government School is usually not convenient, nor is there time available in these short house hunting trips. I would like to suggest that you have a video and/or CD made of one of these sessions. (It could even be staged to be sure appropriate questions are asked.) It should then be distributed to each prospective buyer along with The Villages promotional video/CD and other materials.

District Government School could still be held, but it would be for questions and answer sessions after individuals had reviewed the video/CD material. I really think this would be beneficial for all future as well as current residents of The Villages and ask that you bring it before the appropriate Village body for implementation consideration.

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As you are aware, Mr. Wahl provides monthly reminders of the VCCDD meetings in the classified section of The Daily Sun. He indicates that “¼the meeting is open to the public and will be conducted in accordance with the provisions of Florida Law for Community Development District.” He also states that “¼the agenda may be viewed at the District Office¼”

I would like to suggest that you publish the agenda in that same announcement, or better still, create a web site which would include agendas and attachments at least one week prior to each scheduled VCCDD meeting and complete minutes within seven days following each VCCDD meeting. To expect residents to make a monthly trip to the District Office just to see the agenda does not appear to be appropriate given that the VCCDD has access to a daily newspaper and 24 hour radio and television stations.

In that same regard, as a resident, I would find it helpful if all of the VCCDD meetings were televised on VNN – they could be live or tape delayed later that day or evening.

Please present this suggestion to the appropriate Villages officials for action.

Thank you very much for your prompt telephone response to my October 5, 2006 correspondence.

I was pleased to learn that you are preparing a web site which should be active in about a month which will have the districts agendas and minutes on it. I believe that this will be very helpful to residents. In that regard, I hope that the site will also contain the attachments for each agenda item so that residents can be well versed on each of the items and be better able to determine whether their attendance at the meeting to offer input is necessary.

I was disappointed to learn that you are not yet at the point of being able to televise each of the meetings, but appreciate your assertion that you will work on it. I would like to suggest that you start with televising the meetings of the two central districts - those which impact the largest number of residents, and try to proceed rapidly.

Editor’s note: Our thanks to Ms. Dreidame for making these suggestions regarding important information from the central districts. We’ll keep readers posted as we hear more.

We have received about 700 surveys thus far. But, there are probably many more residents who would like to respond. So, let’s go at least another month or two. Please spend a few minutes filling out this form. You can respond even if not a POA member.

Please rate each question with your opinion on a scale of 1 to 10 where 10 would be your highest, best, or most satisfactory rating – all the way down to 1 which would be your lowest, worst, or least satisfying rating. A rating of 5 would be an average, or middle-of-the-road, answer. If you have no opinion or no information about a question, or it does not apply to you, please put in “NR” (No Rating) for that question.

Then, either bring this form to our next meeting or mail it to: The POA Survey, P.O.Box 1657, Lady Lake, FL 32158.

Thanks in advance for your help in completing this survey. Results will be published in a future issue of the POA Bulletin.

Survey Form

Rating

1. _________ Entertainment Programs on the Town Squares

2. _________ Overall Safety and Security in The Villages

3. _________ Traffic in The Villages

4. _________ The Cleanliness of Villages Streets and Common Areas

5. _________ Landscaping in Common Areas throughout The Villages

6. _________ The Neighborhood Watch Service

7. _________ The Villages Trash (Garbage) Service

8. _________ The Villages Water Utility Service

9. _________ Emergency Fire Services

10. _________ Emergency Medical Services (EMS)

11. _________ The Villages Regional Hospital

12. _________ The Lifelong Learning Center

13. _________ The Monthly Amenity Fee

14. _________ The Yearly Assessments in Your CDD or Town

15. _________ The Original Construction Bond on your Property

16. _________ The Daily Sun Newspaper, in General

17. _________ The Daily Sun Newspaper, Objectivity of Reporting

18. _________ The Villages TV Station, in General

19. _________ The Villages Radio Station, in General

20. _________ The Property Owners’ Association (POA), in General

21. _________ The POA Newsletter, The Bulletin

22. _________ The Villages Homeowners’ Association (VHA), in General

23. _________ The VHA Newspaper, The Villages Voice

24. _________ The Community Improvement Council (CIC), in General

25. _________ The Villages District Manager, Mr. Pete Wahl

26. _________ The VCCDD District Administrator, Ms. Monica Andersen

27. _________ The SLCDD District Administrator, Mr. John Rohan

28. _________ The Developer of The Villages, Messrs. Gary or Mark Morse

29. _________ The Villages Center District (VCCDD) Government

30. _________ The Sumter Landing District (SLCDD) Government

31. _________ The Local CDD or Government Unit in Which You Live

32. _________ If you live in Sumter County, Your Board of Commissioners

33. _________ If you live in Marion County, Your Board of Commissioners

34. _________ If you live in Lake County, Your Board of Commissioners

35. _________ If you live in the Town of Lady Lake, Your Board of Commrs.

36. _________ Condition of the Executive Golf Courses

37. _________ Condition of the Championship Golf Courses

38. _________ The Priority Golf Program

39. _________ Greens Fees on the Championship Golf Courses

40. _________ Idea of turning Chula Vista into a Recreation Center

41. _________ Plans for a new Hotel behind the Rialto Theater

42. _________ Idea of a Tax to Support The Villages Regional Hospital

43. _________ Adequacy of Disclosure Information Given to You when You

Bought Your House Here in The Villages

44. _________ Developer’s Idea to Have Residents Pay to Fix Sinkholes

45. _________ Adequacy of Important Information Provided by our CDDs

46. _________ Idea of Mail Delivery to Homes rather than to a Postal Station

That's not the only place -- there are several unlighted tunnels and worse -- that timber bridge off the northeast corner of Morse blvd and Hwy. 466. If a cart went off that bridge at night it could be disastrous.

I feel it's important for residents to hear both sides of issues that effect us.

I have been here two years now and the newness has worn off as to our lifestyle vs. where most of us came from. In addition, after receiving my first full county tax bill and having a better understanding of the Florida laws, it’s quite obvious the county enjoys the revenue for limited services and the developer has more than protected himself at our expense.

I'm beginning to have concerns as to future unexplained expenses, i.e. easements protecting the developer and private for-profit properties via some very creative legal maneuvers early on which now are at our CCD#4 expense. I'm sure there some other surprises out there that have not come to the surface yet.

All this could lead to a deterioration in our property values in the future if these expenses become unwieldy.

Of most concern are the sinkhole issues not only Lopez but another at Briarwood/Walnut Grove that has just reoccurred again. (What is the story on that one)? Also the premature deterioration of our roads caused by all the heavy construction equipment running over them during the construction phases then handed over to each CCD to repair and or replace with no bond or assistance from the developer. Is this a correct statement?

What are our options in dealing with these issues? For legal options, are class action suits possible if the developer is unwilling to accept responsibility for his role in these issues?

Some of us settled here on fixed or limited incomes, not anticipating these types of expenses to occur. I'm sure there are legal minds within our community that could provide assistance, or, if necessary, an assessment to cover these costs might be necessary to get the straight answers that would benefit all.

It is time to renew your POA Membership for 2006, or to join for the first time, with the form on page 11, upper right hand corner. Just clip the form and either mail it to us or bring it to a POA meeting.

Memberships run from January 1st thru December 31st. The dues are $6.00 per household. And, we really need your support. Thanks in advance for any additional contributions you can make to your POA.

They moved us again. The December 21st meeting will be in the Saddlebrook Center, Fox Grove Room. Then for January, it is back to the Hacienda Center, Ricardo Montalban room. Somebody bring a map!

If you see Bulletins lying in the street or the gutter after delivery, or if you know a house is unoccupied, please pick up the Bulletins and either hold them for the resident’s return, or discard them.

We have the entire local database in a 3-ring binder for viewing at POA monthly meetings.

If you need help on any elder healthcare issue or problem, please call the Shine Elder Help line at 1-800-963-5337. You can also call Harold Barnes, a Villages resident, at 753-8810. Or you can talk to Harold personally at any one of the POA monthly meetings. He has a table display and is ready to talk or help.