BRADENTON, Fla. – The Florida Supreme Court plans to hear oral arguments from central Florida homeowners opposed to a bond issue planned by their community development districts.
Justices will hear arguments April 4 in Tallahassee stemming from the bond validation sought by the Poinciana CDD and Poinciana West CDD. The districts oversee infrastructure in the Solivita retirement community.
A group of homeowners, in an appeal led by Brenda Taylor and William Mann, wants the high court to reverse rulings by Polk County Circuit Judge Randall McDonald on Aug. 31.
Although McDonald did not validate the bonds, he rejected four of Taylor and Mann’s arguments contesting the case.
Homeowner’s objections surround the CDDs' plan to issue 30-year bonds to purchase 17 existing community amenities such as pools, parks, and restaurants – most of which are 15 to 17 years old - for $72.9 million from the developer, Avatar Properties, a subsidiary of AV Homes Inc.
About $22.6 million of additional bonds would be issued to construct new facilities and pay issuance costs.
Taylor and Main said in filings said that McDonald was wrong to reject their contention that the CDDs and developer improperly based the price of the existing amenities on a consultant’s calculation of the maximum affordable purchase price – as opposed to obtaining a just value from a certified property appraiser as required by Florida law – by capitalizing 30 years of future club membership fees charged by the developer to value the amenities in excess of their worth.
Residents are charged fees to use the amenities.
Urban Economics Inc., a state certified real estate appraiser found the market value of the amenities to be $19.25 million.
Taylor and Mann also argue that McDonald erred when he found that the CDDs complied with all legal requirements, that the proposed bond issue served a sufficient public purpose, and when he denied their request for discovery in order to obtain evidence from the developer.
Martin Kessler, 93, is representing himself in a separate appeal that will also be heard by the high court April 4. He says Florida law requires that a CDD make a “fair value computation” of products to be purchased when making payment to satisfy a financial obligation such as a bond. McDonald also rejected that argument.
The Poinciana CDDs filed a new suit to have the bonds validated after revising the assessment methodology securing the debt – a move designed to overcome the single objection McDonald had to validating the bonds in the first case.
Polk County Circuit Judge Steven Selph has declined to hold a hearing on the new bond validation while the Florida Supreme Court appeal is pending.
