MINUTES OF REUNION

MEETING EAST

COMMUNITY

DEVELOPMENT

DISTRICT

The  regular

meeting

of

the  Board

of

Supervisors

of

the

Reunion

East  Community

Development District was held Thursday, January Community Center, 7715 Heritage Crossing Way,

10, 2019 Reunion,

at 1 :00 p.m. Florida.

at

the Heritage Crossing

Present and constituting a

quorum

were:

Mark Greenstein

Don Harding

Steven Goldstein
John Dryburgh

Trudy Hobbs

Also present were:

George Flint Andrew d' Ade sky Jan Carpenter Steve Boyd Alan Scheerer Rob Stultz Gary Perko Vivek Babbar Daniel Baker

Chairman

Vice Chairman

Assistant Secretary
Assistant Secretary

Assistant Secretary

District Manager
District Counsel

District Counsel
District Engineer

Operations Manager
Yellowstone Landscape

Hopping Green & Sams
Straley Robin Vericker

ACP Communities/LRA

Orlando

FIRST

ORDER

OF

BUSINESS

Roll Call

Mr.

Flint called

the

meeting

to

order and called the roll.

SECOND

ORDER

OF

BUSINESS

Public Comment Period

Mr.

Lester:

We

bought

a

house

here

in

2005,

I'm

a

runner

and

do

a marathon and I

run

up

and down the streets

of

Reunion

and

the traffic

on

Reunion

Boulevard

has

gotten

out

of

hand.

I

don't

think it should

be

going

45 mph.

They

had

the

same

concern

at

the

water park and

put

up

the radar signs.

I

ask

that

you

consider putting that up

on

Reunion

Boulevard.

Mr.

Scheerer:

You

asked

me

to

purchase an additional

radar

sign

and you

can

put

it

wherever you  want

and

we

can

relocate  the  one  on  Excitement  Drive  to  some point at the

beginning

of

Reunion

Boulevard

from  532 to the traffic circle

and

one from the traffic circle

January

10,

2019

Reunion East CDD

towards 532 when the wants us to do .

new

one comes in we

can facilitate

that

if

that is

the

direction the Board

Mr. Flint:	lfthere is no		
				objection we can just give Alan direction.		
Mr.	Harding:	I	will ask my contact at Osceola County Sheriff's		

patrols.

Department

to

step up

TIDRD ORDER OF BUSINESS	Approval of the	
		Minutes of the December 13,	
	2018	Meeting	

Mr.

Harding:

On

the first page it should be

Mr.

Dryburgh versus Mr. Harding who got

with Oraine on the parking situation at Carriage Point.		
On MOTION			
favor  the	by Mr. Harding seconded		
	minutes  of	the  December		
				
approved, as amended.			

by Mr. Goldstein with 13, 2018 meeting

all in were

FOURTH ORDER OF	Discussion of				
		BUSINESS					
							Heritage Crossing Community		
			Center  Management	Services  Agreement		
Mr. d' Adesky:		(MSA)								
	George, myself, Mark and Daniel	Baker have	been working diligently on		

the MSA.  We came up with some				Tax				
		revisions based on what					
							Counsel said.  Daniel had sent		
additional comments and I							Tax Counsel said we did		
		reviewed those today and they look fine and			
a much better job of										
	reconciling it.  She had three more	suggestions of terms we have to tweak a		
						
little bit, but I think we									
		should be able to get this to the finish line by the next meeting.		
FIFTH ORDER OF BUSINESS	Ratification		of Use	Agreement for Amenity		
								
			Facilities  with  Reunion  Club  of  Orlando,		
			LLC								
Mr. Flint:  Item five was ratification of the Use							
				Agreement for Amenity Facilities with		
Reunion Club of	Orlando.  I sent an email to the Board that the Resort had contacted us and they		
			
had two special events that they wanted to use this facility for.	Because we didn't go through the		
									
rate making process and set rental rates historically we entered into a use agreement for here and		
Linear Park and they made a voluntary contribution.  There were two different events that they		
held here and I am asking the Board to ratify.									
On MOTION by Mr. Harding seconded by Mr. Dryburgh with all in		
favor the Use Agreement for Amenity Facilities with Reunion Club		
of											
Orlando, LLC was ratified.									

2

January

10, 2019

Reunion East CDD

SIXTH ORDER OF BUSINESS

Discussion

of

Special

Events

PoJicy

Mr. Flint:	At	the last meeting Andrew had provided a draft based on Celebration's policy		
and we need to scale that to what Reunion needs and we need additional time on that.  It is not		
ready for action or ratification today.						
Mr. Harding:		As far as the number of people and so forth any number of people can sign		
up for this	if they want to but I would like to stipulate that any more	than a 25-person group		
would be required to submit a request to have the amenity use.				
Mr. Flint:  Anything under 25	would be first come first served?			
										
Mr.	Harding:	Yes.	I  think  we  need to  designate  the	hours	of use  on Fridays  and		

Saturdays possibly any event							
					would have to end at 11 :00 p.m. and during the week it would have		
to end at 10:00 p.m.										
Mr.	d'											
	Adesky:  We will make it consistent with the ordinance.			
Mr.	Goldstein:  John Cruz	called me today and he basically agrees with this the way it is		
								
right now.  He said something needed to be put in there so there is a mechanism in place so that		
security is notified as to how many						
						people are going to be there, when they are going to be there		
and a good contact.										
Mr.	Flint:	We	can do that	administratively.  We also provide the people reserving it with		
								
a letter, that way	if	security goes out there the person	reserving will be required to have that		

letter.												

Mr. that group? Mr. Mr. it but if it is Mr.

Harding: Are we trying to assume that if someone reserves it that it is Isn't that the intent? d'Adesky: Yes. Flint: We are primarily talking about the pavilion where if they reserve less than 25 people they can't reserve it, it is first come first served.

Goldstein:  I think 15 is a more reasonable number.

exclusive to

it they have

It was the

consensus

of

the

Board to

make

it 20 people rather than

25

.

Mr. d' Adesky:  We will make the time consistent with whatever the law is. Ms. Hobbs:  We need to mention the areas that can be reserved. Mr. Flint:  I think it is better to define what facilities are eligible.  I don't think pools being a part of this because then you are excluding people from using the pool.

the discussion was the pavilion and Terraces and I don't know ifthere are any others.

you want I thought

3

January 10, 2019

Reunion East CDD

Mr.

omitted.

Scheerer:

There is

a gazebo that is physically on the pool

deck

that I think should be

Mr.		Dryburgh:		I	disagree, the person who crune here and complained the loudest was		
							
talking specifically about the gazebo.  They were having big parties.										
Mr.	Flint:	If	they are having big																		
													parties in the gazebo and they  are non-residents then		
security already has the ability to enforce that.	We can include the		gazebo but if you do include		
																								
it inside the	fence of	the pool it will spill over to the pool.	I	don't	think you	want to restrict		
									
access to the pools for	parties, I think that is going to cause a lot	of issues.						
													
Mr.		Dryburgh:		We  are not		addressing  the  issue	that person	brought	up  and  that is		

someone was selling access to the	pool.  I may not like addressing that	issue at the pool but we		

are not addressing the	problem if	we don't address it.																
																						
Mr.	Greenstein:	That issues	doesn't stand alone	as	a special	event issue.	You have		

security  issues	involved.	I was	trying to  craft language	that gives	us	flexibility	but is  still		

specific enough that people																							
								understand the kinds of																
															facilities we are trying to manage.			
Mr.	Goldstein:		I thought the	request for the permit we were doing is for the whole pool,		

the whole complex.																											
Mr.	Dryburgh:			The swimming pool complex whether it has a gazebo or at Homestead		
									
there are different facilities.																							
Mr.	Flint:	Maybe you could allow them to reserve for a	party, but	it is not exclusive use.		
								
	Dryburgh:		We aren't trying to make it exclusive.					
Mr.																		
																															
Mr.	Flint:	The building I	think you probably do want	exclusive.		If someone is going to		

																					
reserve for a birthday	party you don't		want	other people sitting there	saying I'm	going to use it.		

																										
Another way to	address it and the way we address it in most	communities is you have to define		

how many guests per homeowner are allowed.  Then you get into	having	to enforce that but that		
																							
is how you deal	with it	in	most communities.	The amenity policy	defines per home	how many		

																								
guests they can	have.			If	someone is	having	a big party at the pool and you only have one		

homeowner there but 20	people who don't live	there you can deal with it that way but when you		
																	
define how many guests per homeowner be careful what you ask for	because you have to live		
																										
with it.																															
Ms. Hobbs:  I thought what we are trying to get to is people who are using it have to be a		
resident and they have to request a	permit if they are going to go over a						
																									certain number, so you		

4

January

10,2019

Reunion East COD

can say pool.

if

they go over 30 they are totally

impacting

on everybody

else

who

wants

to use that

			Mr. Flint:		Maybe we can make it apply to the pool but not be	exclusive then have to cap		

the	number of people.																															
																																	
			Mr.					If	it is																											
						Dryburgh:				over 20 you have to ask								more than 30.			
																							permission and no					
			Mr. Flint:	We	may have to list each pool and list a minimum and		maximum by facility.		

			Mr.	Scheerer:		We will get the capacities for the	pool on the permit	and include that and		

																																			
you probably don't																															
									want to go to capacity.																					
SEVENTH ORDER OF BUSINESS		Discussion	of	Trustee's		Demand	for		
																																	
			Mr.	d'					I will give some		Assessments to LRA Unassessed Property		
																															
						Adesky:			background	on the issue and	walk		through the history.		

This is an ongoing issue that started May 4, 2016, which is when the							received a letter		
																													District			
from Mike		Eckert of Hopping	Green & Sams on					U.S. Bank	National Association, the		
																						behalf of				
Trustee for the Series 2002 and Series 2005 Bonds, asserting that certain	parcels owned by LRA		
																																	
Orlando,	LLC	and  its	affiliated  entities  were  currently  unassessed,  these  parcels  were		
														
developable parcels or parcels that were being used for private use.	Pursuant to	our investigation		
																															
both  for	O&M	and  bond	purposes,  their	concern	wasn't  with	the	bond	purposes,  but  the		

																																				
unassessed parcels.	These included things such as HOA	owned pools,		the		water park, certain		

golf	parcels, certain other	vacant parcels	of	land	throughout the community.		Pursuant to further		

																									
discussions		with		LRA	we  had	certain	negotiations	regarding  that  and	tried	to	come	to  an		

																																					
amenable solution.	LRA	retained Straley Robin		Vericker, Vivek Babbar	is	here, Tracey Robin		

																																			
has					on it as well, they																											
	worked			looked at the issues and they sent a very lengthy response letter,		
																	
which was	included in		your packet	along with all the exhibits attached to that, which were cited		

including	case  law	and  other things they	cited  as  well.		They  asserted	a		number  of factual		
																																				
defenses, legal defenses and that was received November 2, 2016.	There is a	little bit of	a gap		
																																						
there and we			receive another																								
						didn't		demand letter until					of the											
																							August 21,		following year.  That is		
																																
because during that period I was certain there would be some negotiation	between the parties that		
																																
they might be able to work out	some sort of number and	come up with some				of settlement on		
																					
																																sort			
this	issue.   Until that point we received that  letter we were under the  impression there was		
			
negotiation.		We		came to		find  out there wasn't	much negotiation that		went	on	there  were a		

couple calls and	I	think we were on	one	of those but at that point it	hadn't	been	settled.	The		

Trustee	reasserted their initial remarks and also responded to certain defenses asserted by LRA.		

5

January

10, 2019

Reunion East CDD

At that point									we had spent significant staff resources	both					
	going into 2018			ourselves, the District		
																															
Manager and District Engineer looking into this and	investigating this.	In	addition to our duty		

regarding O&M												have the duty	to		investigate							
		under the indenture we do					this.	We undertook that		
																														
duty,  we  had	the		District Engineer look	at those parcels,		we had		him		do	a  certification of		
																														
developability	of	those	parcels, looking at them		individually	finding	out		whether or not they		

																																
were  developable.	Certain  of	the  parcels	that  the	Trustee	asserted	were	developable,  we		

																														
determined were not	developable, some of	them																			
														were encumbered for example utility easements,		
that would render them	undevelopable, another one had a	sinkhole		on	it,	which rendered it		
																												
undevelopable per the Engineer's analysis.		Pursuant to that		analysis we had our Manager come		
																								
back as methodology	consultant, look at the original	methodology, look	at		the current use of the		

properties and come up with a proposed methodology.  That methodology is included in your		
packet as the Third Supplemental Special Assessment Allocation Report.	It is still a draft but at		
the time that GMS finalized it, it was	circulated to the parties, a copy was received by LRA, the		
														
Trustee made some	comments to our initial draft	of that document.  We	came back and looked at		

some of their concerns, some	we agreed with and		some we did not agree with, and we included		
																			
that in the final draft,	which	is	included in your	packet.	On January 9, 2019 we received a		

response letter, which I	handed out, it is not part of the packet, and that is a	follow-up letter with		

respect to the	unallocated debt issue regarding the 2002 A-2 and 2005 Bond debt, which includes		
			
a lot of LRA' s defenses.	There are some new		assertions,		but a lot		of it is contained in the		

original letter in more	detail so if you read the original LRA letter it contains all these defenses in		
								
further detail.																																	
I										is																							
believe at this time it		appropriate for the Board to	review this.  We are not looking for		

any action today but to	bring this item up for review of the	Board and also to allow the respective		

sides to																																	
present the information.																							
Ms. Carpenter:  These parcels were in default from about 2009 when it was Ginn back		
then and LRA	as their	successor stopped paying assessments, there was a foreclosure action on		
									
those parcels.		The parcels since were acquired		through tax deeds so	there are a lot of facts		
																			
surrounding the parcels.  When the first letter came the District we had the Engineer spend a lot		
of time looking to see	if	these parcels were missed,		if they need assessments, and if they are		
developable.  The Trustee had demanded I	think in round numbers $13		million in unexchanged		

bonds and when I say unexchanged those are bonds that after those delinquent parcels were sold		
to someone new, they were able to replat it and	reassign the debt to	those parcels, it was the		

6

January 10, 2019																								Reunion East CDD		
																												
balance of what was due on the bonds.  There is a big chunk	of money on the bonds that are due		
and there is no way to assess to pay this.		As you can imagine there has		been a lot of history of		
who should pay them, now should they pay them, the assessment methodology says specifically		
that if land is discovered to be assessed it	would be that assessments							
																					would be added.  Certainly,		
LRA and their		Counsel are looking for defenses and it goes on and on.						
										
	When this first came up and we put together a draft assessment report, I don't remember		
what the number	was, but it was under $1	million, that report was presented to the Board and		

was circulated.  Trustee's Counsel came back												
																saying we think some of					
																							these numbers should be		
different and the number they came up with was $1.7 or $1.8	million		of that $13 million.  There		
																								
is																										the properties that are		
property they agreed with our analysis and our Engineer's analysis for				
not	developable because there were a number that were vacant but would never be a commercial		
			
property.  The water park is a commercial	venture but it is not open to the	public, etc.  There are		

a lot of factual	disputes a lot oflegal disputes but procedurally, the District is under an obligation		
					
under the bond	documents to assess																	
											lands that need to be assessed.  The first step in doing that		
was to adopt an	assessment report, set a public hearing at the time anyone who is interested and		
							
the	landowner would put forth any comments or objections they may have and at that hearing the		
			
Board would adopt the assessments on those parcels.										
	There is an argument that the original assessments that were	placed, were placed on all		
																								
the lands so these	properties are already	assessed but in an abundance of	caution it makes sense		

																											
to go through a																								
				process to make sure	there is a full understanding of	those parcels.  Again, the		

District hopes that the	Trustee and LRA can come to	a conclusion							
																					because the District is in the		
middle.  If the District doesn't do	anything and it has been two years		of	working and hoping to		
resolve that the Trustee would be adverse to the District and	could		go	to court and force the		
																										
District to do	this.	If the District adopts the	report at the hearing then		LRA may come and try to		

get an injunction	saying you can't	do this.		The											
																	District is stuck in the		middle.  We wanted to be		
																									
sure that the Board		Members had time	to		look at the report, you can call Andrew or me or		
													
George to get	more	of	the history because we	can't put in the public		something that may go to		

																									
litigation down the	road.	We would like everybody	to take a look at it, call us if you have		
											
questions  and	in the	meantime  we are still hoping.	We have talked	to  LRA and Trustee's		
												
Counsel this past	week trying to	see	if there was any way	of					this forward without		
																					moving				
presenting the report but we received last night a	response from LRA,					
																							which did not seem like		
there was any movement towards a solution.  That is where we are and Counsel for both parties		

7

January 10, 2019

Reunion

East

CDD

and  LRA  has	a	representative  here			if	they	would  like  to  speak  on  their  behalf.   This  is		

information that given the way it is the Board is probably under a duty	fairly soon	to adopt this		
																										
report and set a hearing going forward.																			
	Mr.		Perko:		I'm really here to			respond	to Mr. Babbar's letter				th	so it makes		
															from the 9			
sense for him to go	first.																				
	Mr.	Babbar:		I am with Straley Robin Vericker and we represent		LRA in this issue.  I do		

apologize for the	lateness of the letter, however, as was stated in prior	emails and calls we really		

felt that our original letter addressed comprehensively any issues and any anticipated issues that		
might be brought up.	Much	of the letter is	basically a restatement, a		summary, then you got		

other	points for your consideration.  Our firm also serves as District Counsel to various other		
			
CDDs just like  Mr.  Perko's	and  Mr.		Crumbaker's  firm  does  so  we  understand  how  these		
															
transactions		work,  what  the	obligations	are	and  we  are  familiar		with  the	documents  and		
																								
transactions in	these.		While we didn't		participate originally, we have reviewed them and as you		

can tell by our	original letter we went	through them line by line.	Although it has a complicated		

																					
history with	respect	to	the original issuance,	defaults, restructuring, refunding, trifurcations, it all		

sounds a lot more complicated than it really is the issue we have today.		The issue today is quite		
																									
simple, the Trustee is trying to substitute its benefit analysis and apportionment for the one		
adopted by the District many years ago.  Not only was it adopted by the District, it was reviewed		
by																												
Counsel, the District Manager, and the District Assessment Consultant, the former one as well		
as  the  current	one,	there  are	numerous	certifications  and  opinion		letters  to	the	effect  that		
																									
everything is in order, there are no issues and everything was	disclosed	to the Trustee and the		
																					
bondholders.  Our letter raises several issues with the Trustee's request and it is a request.  They		
have identified that as a request in their	summary as well.  Our letter can be used as	a road map		
																
by the CDD to show that it had done nothing wrong, that it is in compliance with Florida Law		
and in compliance with the indenture.  Not the Trustee or anyone has	shown to	us that they can		
																								
overcome the issues brought up in our letter.  The Trustee represents the bondholders, they are		
sophisticated  investors  that  had  every  opportunity  to  review  the  same  documents  that  we		
reviewed.  They had	every opportunity		to	review the original assessment report.  They know or		

should have known that the allegations that they are bringing forward today are inaccurate.  They		
probably  have  already realized their losses  on their books.   Think about what granting the		
Trustee's request																								
				would do for the District, what it would do for the	residents.	Would there be		
																							
any benefit, would their assessments go down?	The answer is no, look at the assessment report.		

8

January

10,

2019

Reunion East COD

The	facilities identified by the																										
														Trustee are used by the										part	of the program and		
																										residents, they are				
again everything was disclosed in the offering	memorandum as part	of	the transactions.  If the		
																											
cost	goes  up  for LRA you  can		guess	who  the cost will get	passed		on	to.	Think about the		

																																			
precedent this group is creating.		What if in the future the Trustee says	we	still have $13 million		
																				
unsecured  by	assessments,  what	if	they	say		your  50-foot		homes		need	to  be  double  the		

																																					
assessment?  What about residents?	They feel differently.	Admitting to	a mistake when there		
																														
was none at all, again look at the history, look at the	transactions.	It is	our	opinion these parcels		

were never in default because they were	never part of the disclosure action,	there were never any		

assessments on them.  Other properties may have	been with respect to		the	assessments that they		

were imposed upon.		We	encourage you to seek the advice	of your	Counsel, your Assessment		

Consultant, District	Manager and	if you deem necessary an	independent	third party financial		

advisor.		The	question that you	should be asking is not, can the CDD	overcome the issues we		

identified in our letter, but should you.																						
		Mr. Baker stated thank you for												I represent LRA Orlando and		
																			putting this on the agenda.			
affiliated	entities and Vivek had	done a good job	and Mark and Robin	representing our case.  All		

of you	bought into Reunion as	a		community that is highly  amenitized.		You know and have		

																																							
become familiar	with the way	we	have	operated as a resort and		club	and	all amenities that we		

have are offered to property owners or guests, through our hospitality	program and through our		
																																			
club  membership.		That	hasn't			changed	from  the  original  offering  memorandum,  all  the		

amenities that are talked about that somehow over and over again the  Trustee, District staff,		
District Counsel, and Supervisors voted and all		interested parties in	these	hearings missed the		
																												
fact that there		were	golf courses	or																						
																		missed the fact that there	were turf	car facilities associated		
																															
with the	golf	course		or that there was	a pool associated with being a	profit operation is just		

absurd.		I look at it	in terms if I	were you, what	if the District		moved	forward with a change in		
methodology that had	been relied	upon for 17 years by property	owners	and this time they took		

the biggest target and taken all the bonds they	decided to write	off in a	trifurcation and applied it		

to											a target	on	their back.  What if	it was,	we somehow said we don't have an		
somebody who had							
obligation but we will pay $1	million and get rid	of	some of that, what	would stop the Trustee		
																																					
from coming back and	saying	each one	of	your	homes, we forgot we estimated your home at		

only 3,000	square feet	and now	we																						
																		need to go back, we missed that, and now we are going to		
have a methodology that actually		charges you by the square foot	or you have a pool, we didn't		
																				
think there was	going to be any pools so we now assess your	home further.	You can't do that, it		

9

January

10,

2019

Reunion East CDD

is like a loan securing interest and the bank saying wait a second	I	want	to impose additional		
																																
penalties,		additional fees.	That is	not	right and we have taken the	position to articulate and		

																															
itemize every legal				in our opinion, not hide anything,	not	waive the						
							thing				litigation, because we		
																																		
are property owners, we have sat in Board seats, we have appointed	Supervisors, we have elected		
																													
Supervisors to the Board as our representative.	The questions	we	have	asked the Trustee, the		

questions  we  have	asked	in  our  letters	are the		very  same  questions	you		would have to  ask		

																																		
yourself as a Supervisor,	could you	do this and	if you did,	what does	Pandora's box look like,		
																	
because it	opens the door to all kinds of things.  The Trustee	had recourse	on	specific parcels that		
							
were encumbered by debt that the affiliated entity was paying debt	service	on.  The debt was		
																															
appropriated very specifically.	Foreclosure action did	not take place	and	instead they decided to		

reduce the debt	on	those parcels by $18	million.  That was a	choice	the	Trustee accepted to		

reduce the debt	on	those idle parcels, they	didn't have to do that, they	did	it voluntarily.  When		

they did that they basically wrote it off.	It is very	convenient now to	take	that same kind of debt		
																								
and  try  to			find	a	target	of LRA'	s	assets,  that		somehow	they	can	manipulate to  say  these		
																															
documents say all these	things	but we want to reinterpret it.	I ask you	to	look thoroughly at the		
															
issues as a	property,  we		have	been	very		deliberate  and very	concise	and		have everything in		

																														
writing.																																				
	Mr.		Dryburgh:	Jan,	if the Trustee and LRA cannot	come to	agreement, doesn't this get		
																														
adjudicated in a	court?	How does the Board play into it if they can't	come to agreement?		
										
	Ms.		Carpenter:	The District is the issuer of the bonds and the	District has the obligation		

to impose the	assessments so if the District fails to do anything,	if we	say the Board looked and		
									
said we are just	going to ignore this	we	hope they resolve it, if we don't	do	it	the Trustee could		
file a suit forcing the District to do it.	They would allege some	things that	I	will talk about to		
																														
each of you privately.	Then the District would																			
																		incur legal expenses,	fighting the Trustee.  If the		
																														
Board adopts	a	report	to	go  forward  then	LRA will likely  sue the		Board		saying the District		

																																	
should not have gone forward.	The	District is stuck in the middle.												
																										
	Mr.			Dryburgh:	You	are	saying either way we are	going to	get the lawsuit.		

	Ms.			Carpenter:	It	appears that way.																				
																										
	Mr.			Dryburgh:	If	the Board	adopts it either side is	going	to look at the same amount they		

are	looking to either gain	or	lose.																								
																											
	Mr.			d' Adesky:	We	do	want	to limit the discussion because	we are	on the record right		
now.																																				

IO

January 10, 2019														Reunion East CDD		
																	
Ms. Carpenter:	There is a lot to it, now that you have heard					
													some of that and this gives		
you some background to look in the book and read the	letters and	we will	set a time to talk with		
															
each of you to	go	over some of the history, some of the holes we see in	one side or the other or		
both sides.																		
Mr. Flint:	I think today is to hear the	information.  You can't have	a closed meeting until		
												
a lawsuit is filed.	If	there is a lawsuit filed, which we hope there	isn't but under that situation		

you		able to have a closed door											
would be		session and talk about the litigation.  Until that point		
										
everything	is public	record and that is why it is								
										better to have one on one	communications with		
																	
Counsel.																		
Mr. Harding:  LRA and the Trustee could come up to an agreement.				
Mr. d'Adesky:  Theoretically, yes.											
Mr. Flint:  To this point they have not been able to do that.							
Ms. Carpenter:  LRA did seek an injunction against the Board a couple years ago so it is		
not an unknown thing that could happen.											
Mr. Dryburgh:  Is there any liability on our part?								
Mr.  d' Adesky:		Personal  liability, no.   As a Board you		are  covered in	your  official		
actions.																		
Mr.  Perko:		I		am  with  the  Hopping  Green  law  firm  on		behalf	of the	Trustee,  U.S.		
																	
National Bank.  This issue relates to the 2002	Bonds and a portion		of					
													those 2002 Bonds are still		
outstanding, there is no controversy on that.  At the time that the District marketed and sold those		
bonds it was under the	control of LRA.  They								
										marketed and sold those	bonds on the basis of		
																
opinions, certificates, and LRA' s representations that the recreational amenities would be owned		
and controlled by the District.  That turned out not to be the case.  It has					
													been a little puzzling to		
us that LRA is	arguing that it is somehow unfair and inequitable to assess their properties, which		
				
are clearly developable.  Because they are a landowner and are operating a commercial venture		
on those properties and they are not paying assessments, notwithstanding the fact that those		
properties clearly derive benefit from the financing, design and							
											construction and maintenance of		
the public improvements that were financed by the bonds.  We are also puzzled by the statement		
that																		
there was no error or mistake that would justify these new assessments because clearly at the		
time of the 2002 Bond	issue the series 2001 Engineer's Report clearly states that recreation parts		
								
and related Resort amenities in the District proposed CIP and therefore would not be subject to		
allocation.	That turned	out not to be the case, they  should be assessed	and that is why the		

II

January

10, 2019

Reunion East CDD

District	is		trying  to  rectify	through	the  Draft	Assessment	Methodology.  Same  goes	to	the		
																												
statement that			no	material changes to the master plan of									
							there were			development; that is clearly		
																												
not the	case.  There is simply no argument to be made on behalf of	LRA that the properties in		
						
question	do		not benefit from the infrastructure that was financed	by	the	bonds and the District		
																															
has an obligation to assess those properties to	secure repayment of	the outstanding bonds.	We		
																						
urge you to adopt the Draft Assessment Methodology.													
			Ms.	Carpenter:	It	is the 2002 and 2005	Bonds but one thing I	want to make sure you are		

																													
all	aware of, the way the assessments are placed in a development like this back in 2002 and		
			
2005 is there are acres	of																									
									undeveloped land and the	assessments are put	on	as the lots are platted.		
																									
As your subdivision was platted the	assessments got put on each	of	those lots.  Those will not		

change.  The	balance of the debt is sitting on the rest of the undeveloped						
																												land.  As piece by piece		
gets platted								of unassigned debt that is on all	the	parcels.  To get them		
					there is still this big chunk					
built, they will be assigned to	legal parcels	because the assessments run	with the land but I don't		

want anyone to worry or think their assessments	could to up or	be changed		because once they are		

platted the debt is levied on that lot, it is done and it is just the undeveloped land that has this		
enormous debt that gets assigned to it.																						
		Mr.	Baker:  What they are asking	to be	done is to deviate from the current methodology		
																				
that we ratified both times and modified because the original assessment methodology assigns		
debt to principle uses not ancillary uses.																					
		Ms. Carpenter:	I just want them to be aware that the platted lots that have debt will not		
change.		The lands the Trustee is talking about are lands where								to		
																								there was no debt assigned			
them.	There are a lot	of	questions that you	raised on the allocation and how much should be		

allocated and the	amounts and types of	allocations.	I won't deny there are questions between the		

two sides.  I wanted to clarify that for you on how the debt was originally assessed.				
		Mr.	d'Adesky:	This methodology	does not include O&M.	We	have not done an O&M		

analysis for these parcels because O&M is not assessed on these parcels.  We have a yearly basis		
to assess O&M and relative benefit to the parcels.  Because this is an ongoing issue and because		
this will be	resolved one way or another	we	anticipated to	handle the	bond debt issue prior to		

dealing with O&M.																										
		Mr.		Greenstein:	It	has  taken	several	years	to	reach	this	day,  there  have	been		

communication between, among the various	parties and	I now see it	as	coming to a head.	I	do		
																								
not see the Board taking any action on this matter	today.  We are here	to	receive information, this		

12

January

IO,

2019

Reunion East CDD

is	highly complex.	If	we	need to continue this meeting to give each Board Member time to		

confer with	Counsel, to review all the	documents, to  get a better	understanding so they feel		
																										
comfortable	with the	next	step we can		do	so.		I	think  it requires	a		continuation of today's		
																			
meeting.																															
	Mr.	d' Adesky:		It	might not be a formal		continuation of the actual	meeting as much as		

																															
this item was for discussion and any action would be at a future meeting.  The issue itself will be		
continued but the meeting won't be continued.																
	Ms. Carpenter:  When we did	bring up the O&M portion	of it	LRA did come to what we		
																
thought was a fairly reasonable number and how to handle it but they decided they do not want		
to bring that forward while they were still talking about the debt,	feeling	that it had an impact on		
																									
their case.		The Board does need to know that it is a part of this Board	because there is O&M.		

	Mr. Dryburgh:	Are you going to		make a	recommendation as to	what we	should do as a		

Board?																															
	Ms.  Carpenter:    The  District  Manager's  roll  in  this  as  Assessment  Methodology		
Consultant put together the assessment report we gave you looking at the parcels, looking at		
developability, looking	at	the	original assessment	reports from 2002	and	2005.	The various		

changes that  were  made  when the  bonds		were  exchanged  and	then		put	together  what  was		
																												
reasonable from	their point of view as methodology consultant how	to	assess	these parcels.		

Their opinion is on the methodology not on the legal side.												
	Mr. Flint:  There was a prior	version of	this.  What you have in your agenda packet is		
															
more closely related to what the Trustee requested.													
	Ms. Carpenter:  We had a prior version and were hoping to get input from all sides to		
narrow the gap and the Trustee responded and the gap got bigger,	LRA didn't respond.		
																								
	Mr. Flint:  That is when we got to the point where you get together and hopefully you can		
work out a	compromise and we can see ifwe	are comfortable with it and that	didn't happen.		
						
	Ms.		Carpenter:  After two years of	trying that we are at a point now where the District		

has to take	action or not but	do something	formally in the next few	months.	I don't think we can		

wait much longer than that.																								
	Mr.  Babbar:   Our cards are on the  table.   We have  shown you the legal arguments,		
positioning, the defenses.	What we have been	requesting is why are we	wrong.	Show us why		

those arguments are wrong and we will re-evaluate our position.  That is why we didn't give any		
formal				on the Methodology Report because we ?idn't												
	comments		think it was necessary.		

13

January

10,

2019

Reunion East CDD

	Mr.	Baker:	Sometimes time and timing are different things and	I ask that you consider		
								
the	timing	of	this issue being raised.  Many of you didn't have to work through, as Jan	and		
						
George and a lot of	people who suffered	through the recession and the potential foreclosure and		
											
all these	hundreds of thousands		of			that Trustee's								
								dollars		Counsel and	the District had to	go		
																
through to	evaluate this debt we	are talking	about, the land that was in	default and if there was		

material that wasn't being assessed right you would have thought it would be done during the		
time when the	bonds had to be trifurcated.		I encourage you to	put	things in context and think		

why	now, why did they do that, why didn't they								
			Harding:	Whatever is				impose that at that time?					
	Mr.			decided hopefully, it is going to be in the best interests of all		

the property owners.															
	Ms. Carpenter:  We certainly hope we can avoid litigation because I don't like to see the		
costs of that borne by residents,													
						Trustee and or anyone.								
	Mr.	d' Adesky:	We have	done our best to keep our	costs as low	as possible while still		

fulfilling our diligent duty pursuant to the indenture.								
	Ms.	Carpenter:	We have allowed	LRA and Trustee's	Counsel to do the bulk of	the		

																
research.  We have confirmed things but we have not spent time preparing for litigation.			

A. B. C. D.

Third Supplemental Special Assessment Allocation Report Hopping Green & Sams Letter Dated May 4, 2016 Straley Robin Vericker Letter Dated November 2, 2016 Hopping Green & Sams Letter Dated August 21, 2018

EIGHTH A.

ORDER OF BUSINESS	Staff Reports	
Attorney		

Mr. d' per direction.

Adesky:

We

have

been working on the

MSA and we will get the policy revised

as

B.	Engineer

Mr.	Boyd:	On the	signal	I still have not been able to secure		
						
County's final acceptance.  The contractor is working on getting that.	I		
moving the sign and he is		look at it and see what they can do.			
		going to				
Mr.	Flint:	We are still				
			holding back $20,000 retainage contingent		
sign-off.							

documentation of the also asked him about

on the County's final

14

January

IO,

2019

Reunion

East

CDD

	Mr. Boyd:  George									
					received a notice from the Water Management District about several		
parcels that did not have the proper documentation stating that the CDD was maintaining those		
areas.  I am in the process of									
					getting those prepared.						
	Mr. Flint:		Basically with the Water Management District		at a point in time when		
									permits,			
the	infrastructure construction is completed, it is accepted and maintained by the CDD.  There is		
			
a formal process with water management where you transfer the		to the operating entity.		
									permit			
For  one  reason  or  another  we  have  a	number	of these  permits  that	were  never  officially		

transferred to the	CDD	as the operating entity.	We have been	maintaining them for more than		

ten years and the Water Management District is auditing all their files.		I	don't see an issue, I		
														
don't think your Engineer sees an issue with going ahead and formally	signing the transfer to		
operating entity.	They told us ifwe do it by January 21, then they won't	issue a formal violation.		

	Mr. Greenstein:	Where are we on the "Reunion Boulevard next intersection" signs?		
							
	Mr. Boyd:	I	have not dug into that one yet.	I apologize.						

C.	Manager		
	i.	Action Items List		
				
Mr. Flint:  We are		
		working on the MSA.		
know that?				

The

status

of

the transponder system, do you

Mr.	Scheerer:  We		
	reported at the last meeting that was	
		approved and they are in process	
of			
getting the permits in order.		
	Mr.	Goldstein:  John told me this morning that he thought it would be up and running by		
				
the end of the month.																
	Mr.	Flint:	Item five we talked	about, that is	the amenity	policy and we will make the		

																	
changes suggested by the Board.  Potholes on	Sinclair Road, do we know if the County has done		
											
anything on that?																	
	Mr.	Scheerer:		They haven't	done  anything	yet	and	I	resubmitted  another email and		

phone call to road and bridge.														
	Mr.	Flint:	The	speed limit signs we talked about.	I	think we have a plan, we ordered		
									
another one and we are going to relocate an existing sign.	Steve by the next meeting is going to		
													
have	information	on	the signage  on 532	approaching  Reunion Boulevard.   Repainting  signs		

throughout the community, Alan.														
	Mr.	Scheerer:		I talked with the Board at the last meeting.	I received a quote from a		
							
vendor that was approximately $63,000 to repaint all 224	sign posts.	I got one today from		

15

January

10, 2019

Reunion East CDD

Heritage Service Solutions a proposal for $26,880.  The Board did approve a budget for 2019		
that included the $63,000 number in the capital projects.  We reached  out to Orange County		
Painting who has done work here before and they didn't				but 224 sign posts, the		
														submit a bid yet			
back brackets for the stop signs, the street ID	marker brackets,	which  are also black and the		
																		
finials would all be	painted as part of	this project should the Board want to	move forward.		
								
	Mr.	Flint:  A new sign is $800		to	$1,000 per sign.						
	Mr.	Greenstein:	What about the palm trees?							
													
	Mr.	Scheerer:  The palm trees are a sticker.  We will take	those	off and Fast Signs of		

Orlando has						the Board wants us to we can purchase a couple hundred of		
		provided a proof and if			
those and put them on	wherever they go.	It is a very minimal cost.					
											
	Mr.	Greenstein:  We put them up originally for a	reason and I think it tells people they		

are in Reunion when they see the logo.										
		On	MOTION by Mr.		Greenstein seconded by Mr.	Goldstein with		
		all in favor the proposal  from Heritage Service  Solutions in the		
		amount of $26,880 to	repaint the sign posts was approved and staff		
		was directed to put the	stickers on	if they are a minimal cost.			
												
	Mr. Flint:  The developer for the	Spectrum project around the water park is asking for the		
													
ability to install	directional signage.  What they emailed me was not consistent with the sign		
					
policy  you  adopted  and the  design  standards.		Reunion  West had  not	previously  approved		
																
signage standards and at the meeting	before this you did adopt the same signage standard as		
												
Reunion East and they	delegated authority to Mr.	Greenstein to meet with Spectrum to work on		
									
the	location and sign-off on the design because	Mr.	Greenstein is on both Boards that makes		

sense if this	Board is amenable to that.											

It was the consensus

on the signage.

of

the

Board to

appoint

Mr.

Greenstein to be liaison with Spectrum

Mr.

Dryburgh:  The damage that has occurred' on Sinclair with the contractor employees

parking on the strip, breaking down the cement.

I'm

assuming that is all our stuff.

that is

Mr. Flint:	It is actually the County.	We are	
		maintaining it.  The County will make sure	
all repaired		
	before they issue final approvals.	

ii.

Approval

of

Check Register

Mr.

Flint presented the December check register in the

amount

of

194,690.77.

16

January

10, 2019

Reunion

East

CDD

On MOTION by Mr. Harding seconded by Mr. favor the check register was approved.

Goldstein

with

all

in

iii.

Balance Sheet and Income Statement

A copy of the balance sheet and income statement were included No Board action was required.

in

the agenda package.

iv.

Status

of

Direct Bill Assessments

A copy

of

the

status

of

direct bill assessments was included in the agenda package.

NINTH ORDER OF BUSINESS	Other Business	

Mr. d'Adesky:	There will be a public hearing for		and		
		Reunion West on February 2P			
			1			
might make sense to have our meeting then to save money for both Districts.				
It was the consensus of the					
	Board to have the February	2019		
		meeting on February 21,			
1:00 p.m. at the Heritage Crossing Community Center.					

it

at

TENTH ORDER OF BUSINESS	Supervisor's Requests	
There being none, the next item followed.	
ELEVENTH ORDER OF BUSINESS	Next Meeting Date	

On	Greenstein seconded by		
MOTION by Mr.			
all in favor the meeting adjourned at 2:13 p.m.		

Mr.

Goldstein with

17