The North Pines Metropolitan District recovered over $1 million in public funds from developers that were being improperly used, invalidated contracts that would have imposed significant additional costs on homeowners, obtained judgments against developers totaling over $1 million, reduced annual expenditures and increased cash surplus, and lowered interest rates on bonds to reduce costs for homeowners while paying off debt earlier. They also increased transparency and held public meetings.
1. North Pines Metropolitan District Accomplishments
- Recovered $306,216 in public funds for the District that were under developer control in
an unauthorized special escrow account.
- Invalidated a 3-year management and bookkeeping contract that would have kept the
developer in control of the district’s operations, and invalidated a $10,000 early
termination fee
- Invalidated an advance and reimbursement agreement for operations advances with the
developer that would have imposed $301,749 of debt on the District and increased fees
by $920 per homeowner per year to pay alleged amounts owing the developer
- Invalidated an advance and reimbursement agreement for capital advances with the
developer that would have imposed $820,659 in additional debt on the District to pay
alleged amounts owing the developer
- Obtained a judgment for $500,000 plus interest, costs, and fees against the developer for
rescission of a water rights sale contract that was determined to be unfair to the District
- Terminated the Whisper Advance and Reimbursement Agreement that would have
imposed potentially $10 million of additional debt on the District to fund the developer’s
Whisper development
- Obtained a judgment against David Gertz personally for $529,539.86 plus costs and
interest for fraudulent transfers that rendered Sky Rim Development insolvent.
- Negotiated an agreement with legal counsel to protect the homeowners so that the
extensive litigation costs of more than $250,000 would be contingent on collections
- Changed the fee structure so that vacant developer-controlled lots would have to bear a
fair share of the District’s operation and maintenance fees that benefits these lots
- Brought a lawsuit against the foreclosed Whisper property to recover fees, resulting in a
negotiated settlement for $114,357 in fees collected by the District as well as an
agreement to pay fees of more than $30,000 per year to the District from 2010 to the
present
- Brought a legal malpractice lawsuit against the former attorney for the District, resulting
in a negotiated settlement as reflected in the District’s financial records
- Entered into an intergovernmental agreement with Clearwater to finance the backup
generator purchase that the developer failed to fund, saving residents a $1,000 per home
special assessment that the developer attempted to impose
- Reduced management expenses by consolidating legal and management services in 2010,
eliminating over $2,000 a month in management costs
2. - Entered into a joint management and financial agreement with Clearwater to further
reduce legal, collections, management, and accounting costs and allow homeowners to
write a single check for all services to both districts
- Negotiated an early repayment of $300,000 of debt, saving the District over $20,000 a
year in expenses in 2011-2012
- Successfully amended the service plan and refinanced bonds in November 2012, reducing
the interest rate from 6.75% to 3.75% and allowing the debt to be paid in full by 2032,
three years earlier than planned, while reducing annual debt service by approximately
$20,000 each year.
- Reduced the District’s annual expenditures while increasing the cash surplus in the
operating account.
o 2008 expenditures $131,980 Fund balance $126,499
o 2009 expenditures $178,157 Fund balance $92,447
o 2010 expenditures $241,120 Fund balance $87,752
o 2011 expenditures $127,004 Fund balance $167,217
o 2012 expenditures $110,643 Fund balance $288,838
- No increase in your operations fees or taxes since taking over from the developer in 2008
- Held full and open public meetings at least quarterly at Blackstone Country Club, with
full public posting of agendas, minutes, and financials. Annual transparency notices to
homeowners and notice of important public hearings on issues such as the bond
refinancing.