Villa Reserves Misdirection–Again?

To: Members of The Board of Directors of Sun City Anthem

Re: The status of the reserves of the 162 Villa home owners in Sun City Anthem.

There has been much controversy about the reserves of the four Villa neighborhoods ever since the transition from Developer control to resident control on May 31, 2005. This letter is to inform you that the controversy is not over.

On September 27, 2007 the board of directors established a task force to investigate possible shortages in the reserves of the association, as well as the neighborhoods. The resolution of the board of directors is reproduced here.

“C. Reserve Analysis Study-Diversified Facility Services, Inc. (Action May Be Taken): The Board recommends a bid from Diversified Facility Services, Inc. to take the 2006 Reserve Study and work back in time to validate Reserve funding required from developer at transition, May 31, 2005.”

The wishes of the board could not be more clearly defined;

“* to take the 2006 Reserve Study and work back in time to validate Reserve funding required from developer at transition, May 31, 2005″

The task force did not follow this directive, and as a result their findings are badly flawed. The task force did however, discover many serious mistakes and omissions that were made by the contractor Diversified Facilities Services. I have also discovered mistakes made by a lay person who assisted the committee working as a volunteer (Anita DeSousa). She has never been elected to represent any one of the four Villa neighborhoods.

As chairman of the task force the board of directors selected Jack Troia. Jack Troia had previously assisted in preparing a flawed and illegal document known as “The Villa Agreement”. I have long declared this document to be illegal, because it has never been validated by any legal authority including John Leach (our association attorney). Jack Troia’s participation in the preparation of the Villa agreement that limited the amount of the developer contributions to make whole the reserves of the Villa neighborhoods is a clear conflict of interest. No normal thinking person would expect Jack Troia to come up with evidence of his own failures (or worse). Why would any one expect differently? Indeed, under Jack Troia’s direction, the task force concluded that there was no shortage in the reserves of the neighborhoods that he had previously examined. No surprise there.

I have included with this letter, some calculations of my own that satisfy the resolution passed by the board of directors on September 27, 2007. Using the 2006 reserve study as the board resolution demanded, a short summary follows;

For High Mesa neighborhood.

On May 30, 2005 a deficit of $256,305 existed in the reserves. This deficit was reduced by $81,035 the next day to $175,270. According to the accounting records some time in May 0f 2007 the deficit of $175,270 was reduced by $50,602 resulting in a $124,668 deficit that still remains and is proven by the End of year reserve figure of $184,233 vs the fully funded number in the 2006 reserve study $308,901.

For High Mountain neighborhood.