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Bill to alter community development districts filed

It would let them enforce deed restrictions and require builders to be clear on homeowners' debt.

By JOSH ZIMMER, Times Staff Writer
© St. Petersburg Times
published March 4, 2003

Changes to the state law governing community development districts, including one that would let the districts enforce deed restrictions, could be on the way.

State Rep. Ken Littlefield, R-Wesley Chapel, introduced the bill Friday. Another change would require developers to tell potential homeowners up front how much debt they would have to pay toward amenities.

The debate about the proposed changes to the law, which is increasingly popular with developers across the state, promises to be lively. Initial reaction ranged from cautious optimism to disappointment.

Jan Bergemann, president of the 2,000-member Cyber Citizens for Justice, wasted no time in posting the bill on the group's Web site, ( "Nobody likes it, not from our side," he said. "Everybody feels it's a developer-friendly bill."

Cyber Citizens was looking for deeper reforms, Bergemann said. The group recently offered a much tougher proposal for amending the 1980 law.

Littlefield, meanwhile, urged patience. The draft is open to change, he said.

"It's a start; it's more than we have," he said.

As it stands, the law gives developers major advantages.

In contrast to traditional funding, the law allows developers to issue tax-free bonds, which homeowners pay off through long-term debt.

With an easy pot of money at their disposal, developers often add amenities, such as golf courses and swimming pools, that make their communities more appealing to buyers. All the while, developers maintain control for the first six years through the all-powerful CDD board.

CDDs are exploding across the state, state records show. From just a trickle a decade ago, they now number about 200, including 14 in Pasco County and more than 20 in Hillsborough County.

Experts point out that many CDDs are working well and are not saddling their residents with debt. But in at least two cases, those of Heritage Harbor in Lutz and Heritage Isles in New Tampa, homeowners are facing potentially crippling debts because their golf courses are not earning enough money to pay off millions of dollars in bonds.

Littlefield, who met with residents and developers before drafting the bill, is proposing several changes.

The proposal would increase the size of CDDs that are subject to local government approval from 1,000 acres to 2,500 acres. Anything larger must be approved by the state.

It also would make it possible for CDDs to enforce deed restrictions and require developers to state more clearly on sale contracts -- using bold lettering -- the amount of assessments, including bond debt, homeowners would be required to pay.

The power to enforce deed restrictions is critical to leaders in Wesley Chapel's Meadow Pointe and Meadow Pointe II communities.

Trout Creek Development Corp. found itself in court when it failed to create a mandatory association in Meadow Pointe. Homeowners sued Trout Creek and several Meadow Pointe homebuilders in 1998, contending that rules could not be enforced and that property values would suffer as a result.

A Pasco judge ruled in 2000 that the community's voluntary association could do the job just fine.

However, voluntary associations often lack the money to take violators to court because residents are not required to join and pay the dues that go toward bringing lawsuits.

Recently, a Meadow Pointe II resident who built a 27-foot long pirate ship in his back yard said the only way the homeowners association could stop him was to sue, and he knew it lacked the money to follow through. The ship, which is 121/2 feet high, prompted a couple whose back yard abuts the ship to complain to the homeowners' association.

"Without some kind of enforcement power, people feel that they can still do what they want despite the fact that they all signed papers saying they would abide by the deed restrictions," said Mark Glassman, a resident and member of the Meadow Pointe II CDD board.

Bergemann and others say increasing local government jurisdiction over CDDs and allowing CDDs to enforce deed restrictions opens residents to more abuse, not less.

At the same time, the bill fails to improve accountability for CDDs, Bergemann said.

He and others also criticize the proposal for not attacking the law's fundamental flaws. Cyber Citizens, whose reform proposal is backed by the Florida Silver-Haired Legislature, wanted to see legislation that increased homeowner representation on the CDD boards and placed more restrictions on land purchases by CDDs.

In some cases, developer-controlled CDDs have bought property from the developer at outlandish prices.

Not everyone was disappointed. Dennis Smith, a supervisor on Pasco County's Meadow Pointe CDD, said the bill was not perfect but did address some important administrative weaknesses in the current law. He consulted Littlefield on the draft.

"The way we view this is it's a good first step," he said.

Littlefield predicted a "typical turf battle" over the bill between consumer interests and developers.

"I'm sure they (developers) would be satisfied to keep it just the way it is," he said. "It will be interesting to see at this point who comes out of the woodwork, for or against."

-- Staff writer James Thorner contributed to this report.

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