UPRD Newsletter No. 3
May 9, 2019
One of the questions that we hear is “we don’t know what is going on.” The best way to stay informed is to attend the RD meetings and workshops where you have the opportunity to ask very specific questions. You can always read the minutes from prior meetings; however, they cannot be posted until they have been approved which takes at least one month. Another way to stay informed is to contact any RD Supervisor. We are still working on updates to the RD web site and when that is completed it should be easier to find all the latest information.
Here are the scheduled RD meetings and workshops for the next few months.
RD Meetings – Lakeside Room 1-3 PM
May 10, 2019
June 14, 2019
July 12, 2019
August 9, 2019
September 13, 2019
Workshops – Varsity Card Room
May 21, 2019 10 AM – Noon
June 7, 2019 1-3 PM
June 25, 2019 10 AM – Noon
July 5, 2019 10 AM – Noon
July 23, 2019 10 AM – Noon
August 2, 2019 10 AM – Noon
August 20, 2019 10 AM-Noon
September 6, 2019 10 AM- Noon
September 23, 2019 10 AM – Noon
There are two items of concern to all UPCC residents. First is the status of the lawsuit and second is the assessments needed to cover legal costs associated with the lawsuit.
The District has attempted to enter into a settlement with Mr. Garrett. Supervisor Smith had several lengthy conversations with Mr. Garrett resulting in the RD proposing some compromise solutions. Unfortunately, his attorney did not reject our settlement proposal nor offer any alternative counter proposal, and there has been no further communication from them. The District believes that Mr. Garrett’s purpose is to delay the RD’s acquisition of the club, thereby letting deadlines expire for the Purchase and Sale Agreement. As long as the lawsuit continues, the RD will continue to incur increasing expenses for this litigation.
On Monday May 6th a hearing was held in the Manatee County Twelfth Judicial Circuit Court to obtain validation for the planned bonds. One half hour was on the court docket for this case, and Judge Nicholas spent almost 2 hours listening to both sides. There will be another hearing(s) scheduled at a later date. Until the lawsuit is resolved, we cannot proceed with the financing that was originally planned, 30-year bonds at interest rates of 4-4.5 %.
It is anticipated that the legal bills to defend this challenge could run into the hundreds of thousands of dollars. As previously reported, there are no funds available to cover these additional legal fees. The RD Board has discussed assessing each home in UPCC $1000 to cover the legal fees. This will not be prorated because every home, regardless of size, has equal responsibility to cover these costs. There are two options for collecting special assessments: (1) the Uniform Method (on your tax bill) or (2) direct bill (sent out by the RD). Each option has its pluses and minuses, but after analysis the most effective method is to directly bill each home.
The Purchase and Sale (P&S) agreement we have with the Sellers states that we have until June 14, 2019, to complete the transaction. Our original agreement was scheduled to be completed by February 28, 2019, but due to the lawsuit it was extended to June 14th. If we fail to complete it by that date, we start to incur an additional cost of $46,000 per month added to the purchase price until the purchase is finalized or runs out in September. The additional amount is approximately what the Sellers could earn on the money if the sale had been completed as agreed.
If the lawsuit cannot be resolved, the RD will need to borrow the funds to complete the acquisition at a higher rate due to the increased risk associated with this loan, probably 5.75-6+%. The loan must be repaid in two (2) years according to our charter; however, the state allows five (5) years so there is the possibility that it could be extended if need be.
The RD was formed to purchase the “club” and the Supervisors are committed to doing just that. However, we also recognize that under the current circumstances this may come with additional risk. The risk is that if in the unlikely event we are unable to repay the loan, UPCC residents would have to cover the loan repayment. This is estimated to cost $20,000/house. We want to emphasize that this is not the expected outcome; however, for transparency we want to be clear that there is some risk.
We need the continued support of the over 80% of YOU who fully support this acquisition. Please be assured that each of the Supervisors is wrestling with making the best decisions for all of US. Although we remain hopeful that an amicable solution with Mr. Garrett can be reached, be assured that we are fully prepared to move ahead with the acquisition favored by the super majority of residents.