DEERFIELD RESORT POA
Deerfield News Connection
October 7, 2024
What Is a Distress Warrant and How Could It Affect Us?
A distress warrant allows the government to seize property or assets to recover unpaid debts, typically as a last resort. If taxes remain unpaid, the state could seize the developer’s assets—including property or bank accounts—to cover the debt. What makes this situation particularly concerning is that Fields Development operates its business out of a shared account with the Deerfield Resort HOA. Through depositions in June 2023, we learned that all payments and receipts for Fields Development are processed through this shared account, which is also used by other family-affiliated companies.
This is a significant risk for the Deerfield Resort HOA. Not only could the HOA’s monies be seized if the state filed the distress warrant, but since Fields Development owns the HOA’s common areas—such as the tennis courts, playground, and pool—those amenities could also be in jeopardy. If the state seizes any of these assets, property owners could face disruptions in access to these shared spaces, potentially adversely affecting property values.
According to the deposition of Paula Lejeune, Deerfield Resort generated $349,435.36 in income during the first quarter of 2023 - about $75,000 more than the entire year of 2022. Despite this revenue increase, the Fields failed to make timely tax payments, which raises questions about where the revenue is going.
Tennessee Distress Warrant Notice for Unpaid Taxes
On April 25, 2024, the Tennessee Department of Labor and Workforce Development issued a Distress Warrant Notice to Fields Development Company, Inc., which does business as Deerfield Resort. This notice was prompted by the Field's failure to pay unemployment taxes owed from April 2022 to March 2023. This is in addition to the federal employee withholding taxes that Fields Development also failed to pay during the same period.
This notice was issued more than a year after the taxes were originally due, and shows the amount of unpaid unemployment taxes as $9,605.39, with an additional $1,930.38 in penalties and interest—bringing the total amount due to $11,553.77.
Why Should Property Owners be Concerned?
The Fields have routinely paid taxes like these using Deerfield Resort fees collected from property owners. In fact, the failure to pay these taxes has resulted in $1,930.38 of property owner fees being used to cover penalties and interest—funds that should have been dedicated to maintaining common areas, improving security, or supporting other essential community projects.
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Day 1, Page 250, lines 1-18, 6-28-2023
Questions to Consider
As Deerfield Resort prepares for the first election of Board of Directors in 38 years, this situation raises several important questions for homeowners in Deerfield Resort:
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Why did Fields Development Company fail to pay taxes despite generating significant revenue? With an increase in income for the first quarter of 2023, why weren’t these tax obligations met? - With significant income reported, these tax obligations should have been prioritized.
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Were HOA funds used to pay the developer's tax penalties? -HOA dues should be dedicated to maintaining and improving our community—not covering business debts.
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What happens if the state seizes the developer's assets, including HOA common areas? How would this affect homeowners’ access to shared amenities, and what impact could this have on property values? -Seizing common areas could negatively affect access to amenities and diminish property values.
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Why does Fields Development Company manage its finances through a shared account with the HOA? -Mixing funds creates a lack of transparency and makes it difficult to ensure proper use of HOA resources.
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What safeguards are in place to prevent HOA dues from being misused in the future? How can homeowners ensure that their dues are used properly for community projects and not to cover the developer's debts? -As property owners, we need assurances that our dues are protected and used solely for the community’s benefit. The lack of transparency is a key reason why the lawsuit was filed. Once we transition to a property owner-directed HOA, as ordered by the court, we will have the opportunity to implement safeguards that can prevent future misspending and ensure better financial oversight moving forward.
Moving Forward
The upcoming transition to property owner management represents an opportunity for property owners to advocate for greater transparency, accountability, and financial oversight. By asking these questions and staying involved, we can safeguard our community’s finances and ensure that our dues are used effectively for the benefit of all property owners. As we transition to a property owner directed HOA and take on more responsibilities, we can ensure that the financial future of Deerfield Resort is secure and that our dues are used effectively to support our community.