HomeMy WebLinkAboutOrd 1067 C/Z 04-01 - PDCC Development, LLC & DahoonREVISED 06/24/04
ORDINANCE NO. 1067
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PALM
DESERT, CALIFORNIA, AMENDING ORDINANCE NO. 107, THE
PALM DESERT ZONING MAP BY CHANGING THE ZONE FROM
OPEN SPACE (O.S.) TO R-1 9,000 FOR 41 LOTS AROUND THE
GOLF COURSE PERIMETER, CHANGING THE ZONE FROM OPEN
SPACE (O.S.) TO PR-6 PLANNED RESIDENTIAL SIX UNITS PER
GROSS ACRE FOR 9.68 ACRES IN THE AREA OF THE EXISTING
DRIVING RANGE. ALL PROPERTY BEING A PORTION OF SECTION
13 AND 14 T5S R6E, PALM DESERT COUNTRY CLUB AREA.
CASE NO. C/Z 04-01
The City Council of the City of Palm Desert, California, DOES HEREBY ORDAIN,
as follows:
SECTION 1: That a portion of Ordinance No. 107 referencing Section 25.46.1
of the Zoning Ordinance, the Zoning Map (Chapter 35.46 of the Palm Desert Municipal
Code) is hereby amended to read as shown on the attached Exhibit "A."
SECTION 2: The City Clerk of the City of Palm Desert, California, is hereby
directed to publish this ordinance in the Desert Sun, a newspaper of general
circulation, published and circulated in the City of Palm Desert, California, and shall be
in full force and effect thirty (30) days after its adoption.
PASSED, APPROVED AND ADOPTED by the Palm Desert City Council this
day of , 2004, by the following vote, to wit:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
RACHELLE D. KLASSEN, City Clerk
City of Palm Desert, California
ROBERT A. SPIEGEL, Mayor
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Case No. CIZ 04-01 CITY COUNCIL
CHANGE OF ZONE
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ORDINANCE NO. 1067
Date:
Jul 07 04 05:O1p
Jul 07 00 01:04p
City Builders/Cruse Exper 415 457-6981 p.2
p.l
77200 California Drive
Palm Desert, CA 92211
Palm
Desert
Country C l u b
Development LLC
June 29, 2004
RE: PDCC PROJECT UNANIMOUSLY APPROVED BY CITY COUNCIL
Dear PDCC Resident:
Phone: 877.760. PDCC
Fax: 877.884.5601
We are thrilled to announce that the proposed Palm Desert Country Club golf course and clubhouse
improvement program and residential project was approved by the Palm Desert City Council in a
unanimous vote at last Thursdays council meeting. After months of planning, review and approvals,
this is an incredible victory for PDCC members, residents, and the entire community!
Palm Desert Country Club Development LLC extends our sincere thanks to all of the supporters of this
project who have attended meetings, written letters, volunteered, and offered their steadfast
encouragement throughout the planning and approvals process. This is your achievement and we,
along with the entire PDCC community, thank you.
As proposed, this project will provide badly needed restorations and enhancements to the PDCC Golf
Course facilities, clubhouse, and surrounding neighborhood, including:
• Complete renovation and enhancement of the PDCC Golf Course (all 27 holes and new
automated irrigation system)
• Complete renovation and enhancement of the PDCC Clubhouse
• Development of 95 new single family, one story homes
• Permanent preservation of the PDCC Golf Course as a golf course
As we begin construction and implementation of the proposed development and improvements above,
we invite you to visit our website www.pdccdevelopment.com to view updates and track progress. Our
next step is to complete design and engineering schematics for the clubhouse, golf course and
residential lots so we can begin construction activities in September.
For those you interested in purchasing a new home in the development, please confirm or establish
your interest by completing our online form at www.pdccdevelopment.com. As our community
improvements begin to take shape, we will be communicating with people on our interest list via e-mail
and U.S. mail.
Sincerely,
Larry J. Kosmont, CRE
Managing Partner
Ikosmonl(d3kosmont.com
Randy Case
Partner & Project Manager
rcasec kosmont.com
Sherry Ryan
Partner
Nam ealcoQdc.rr.con1
Received Jul-07-04 04:40pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 02
Jul 07 04 05:01p
City Builders/Cruse Exper 415 457-6981 p.3
Hello Neighbor,
Sorry we missed you!
570
Pam Desert
Country Club
Development LLC
As you may or may not know, the new development and renovation of Palm Desert
Country Club was approved by our City Council on Thursday, June 24, 2004. Tracts
2137 and 2283 fall within this development. The deed to your home contains a clause
which expired in 1990, and will be modified. As a courtesy to you, the Palm Desert City
Council has asked us to bring a notary to you, at no cost, to obtain your signature(s).
The deed restriction will not be removed, merely modified.
We are available from 9:00 a.m.-12:00 noon, and from 5:00 until approximately 7:00
p.m. If these times are inconvenient for you, we will come to your home in a time
frame that suits you. Simply call Scott Johnson, General Manager, Palm Desert Country
Club, to set an appointment - (760) 272-6819 or, e-mail him at PDCCPROcAOL.corn,
and a representative from Palm Desert Country Club and Palm Desert Country Club
Development, LLC, along with a Notary Public will stop by. Once again, this service is
free of charge.
Attached are renderings of the new Club House, and the new homes being developed.
Please take a few minutes to look at the areas involved. The new homes being built
will be modified in your current deed restriction. Should you have any questions, please
feel free to call.
Thank you for your anticipated prompt response.
Palm Desert Country Club Development LLC and Palm Desert Country Club
Received Jul-07-04 04:40pm
From-415 457 60131 To -PALM DESERT CITY CLE Page 03
Re: Your Signature is Needed for PDCC Improvement Project
Dear PDCC Resident:
We're sorry we missed the opportunity to explain in person some important
final steps toward gaining approval of the proposed Palm Desert Country
Club development project.
In order to insure that this project moves forward, it is critical that the legal
owner(s) of your property sign and notarize an Amendment to Declarations
of Restrictions document that we have on file.
For your convenience, we have arranged to have a notary available
(FREE of charge) at the following location and time:
xxxxx New York Street
Saturday, June xx, 2004
x:00 a.m. — x:00 p.m.
**You will need to bring your divers license or other legal ID with you**
If you cannot make it at the above -specified time, we would be happy to.
make arrangements for a notary to come back to your home. Please feel
free to contact Scott Johnson at (760) 272-6819.
Thank you!
June 4, 2004
Re: Your Signature is Needed for Proposed Palm Desert Country Club Project
Dear PDCC Resident:
As you know, in January of this year PDCC Development LLC made an application to the City
of Palm Desert for a project that will provide badly needed restorations and enhancements to
the PDCC Golf Course facilities, clubhouse, and surrounding neighborhood. The proposed
development will provide for the following:
• Preservation of and improvements to the PDCC Golf Course (all 27 holes and new
automated irrigation system)
• Complete renovation and enhancement of the PDCC Clubhouse
• Development of 95 new single family, one story homes
As the project nears approval by the Palm Desert City Council, your support is needed in an
amendment to a deed restriction that applies to Tract 2283 and Tract 2137 — which is where
the new homes will be built.
You are receiving this letter because you own a home in either Tract 2283 or in Tract
2137 of the Palm Desert Country Club area (please see the accompanying map to view the
location of the new homes as they relate to Tracts 2283 and 2137).
The purpose of this letter is to provide you with an OFFICIAL Amendment to
Declarations of Restrictions document.
If you agree to support our efforts to enhance the community and move forward with
the proposed project, the document would need to be signed and notarized by the legal
owner(s) of your property.
Most of us have acknowledged our support for this project in various forums throughout the
approvals process — we are committed to this project because PDCC Development LLC is
committed to our community. They have worked closely with us individually and as a
community for over a year, in an effort to ensure that the final plan was one that our
community would be pleased and enthusiastic about. This is much more than what most
developers would ever strive to do. Additionally, the PDCCA (Home Owners Association)
Board voted to support the project after an official homeowners vote in February 2004
produced an overwhelming, near 70% vote in favor of the project.
Now, as the City Council prepares to make a final decision (expected June 2004), your official
signature of support on the enclosed Amendment to Declarations of Restrictions document is
needed in order to finally move forward with the project.
If you sign and notarize the attached Amendment to Declarations of Restrictions
document, it does the following:
1 — The enclosed "Declarations" document modifies the existing deed restrictions for the
PDCC property (Tracts 2283 and 2137) by allowing development of new single family homes
in the locations shown on the accompanying map:
• 73 new homes in Tract 2283
• 17 new homes in Tract 2137
*5 of the proposed new homes are located outside of tract 2283 and 2137
2 - Your notarized signature on the enclosed "Declarations" document signifies your
understanding of the deed modification, and indicates your support of the development project
as proposed:
• The signature of a property owner in Tract 2283 indicates your support of 73 new
homes in Tract 2283.
• The signature of a property owner in Tract 2137 indicates your support of 17 new
homes in Tract 2137.
We have come so far as a community to promote projects like this, which enhance recreation,
open space and infrastructure, beautify our neighborhoods, and benefit residents. The
undersigned 14 members of the PDCC community, who average over 15 years in this
community, strongly urge your immediate support and action. Please sign and notarize now to
ensure that this project comes to life!
Sincerely,
Charlie Ash
Home Owners Association Board Member
Rick Barnes
Past Men's Club President
Past Board of Governors Member
George Boal
Board of Governors Member
Past Men's Club President
Jan Christian
Board of Governors Member
Past Ladies Club President
Lu Clubb
Past Ladies Club Board Member
Ruth DeGeorge
Past Ladies Club President
Linda Giroux
Board of Governors President
Ray Hofius
Men's Club President
Board of Governors Member
Scott Johnson
PDCC Director of Golf (10+ yrs)
Mac McLaren
PDCC Social Club President
Barbara Powers
Past Board of Governors Member
Past Ladies Club Board Member
Jim Olsen
Home Owners Association Board Member
Past Men's Club President
Peggy Podojil
Board of Governors Member
Past Ladies Club Board Member
Butch Wilson
Men's Club Member
Home Owners Association Board Member
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
PDCC Development, LLC
77200 California Drive
Palm Desert, CA 92211
Space above this line for recorder's use
AMENDMENT TO DECLARATIONS OF RESTRICTIONS
Tract 2283
This Amendment to Declaration of Restrictions ("Amendment") is made this 4th day of June, 2004, by
undersigned property owners, comprising fifty-one percent (51 %) of owners of residential Tots in Tract 2283.
1. Declaration of Restrictions. On March 6, 1963, the Marnel Development Company, a corporation
("Declarant") executed a Declaration of Restrictions ("Declaration") which was recorded on March 12, 1963 as instrument
No. 24645 in the office of the Recorder of Riverside County, State of California. The Declaration sets forth certain
restrictions regarding the use of certain real property, more particularly described as Lots 2, 3, 4, 5, 6, and 7 in Tract 2283
recorded in Book 42, pages 82 through 89 inclusive, records of Riverside County.
2. Authority to Modify. Pursuant to the express terms of the Declaration, the restrictions lapsed as of
January 1,1992. There may be a portion of omitted language in the Declaration under paragraph 2 which was contained
in a companion Declaration of Restrictions for Tract 2137, (the "Tract 2137 Declaration"). The Tract 2137 Declaration
provides that, from and after January 1, 1992, the restrictions would be renewed for successive five (5) year terms unless,
at any time after January 1,1992, the owners of fifty-one percent (51 %) or more of the number of residential lots in Tract
2137 determined in writing to supplement, change or rescind the restrictions contained in the Tract 2137 Declaration. As
of the date of this Amendment, there has been no judicial determination that the Declaration is to be automatically
renewed for successive five (5) year terms as provided in the Tract 2137 Restriction. However, in the event it is ever
determined by a court of competent jurisdiction that the Declaration is to be reformed to include the language of the Tract
2137 Declaration regarding the automatic renewal for successive 5 year periods unless at any time after January 1,1992,
the owners of fifty-one percent (51 %) or more of the number of residential lots in Tract 2283 determine in writing to
supplement, change or rescind the restrictions contained in the Declaration, then the undersigned owners want the
Declaration, as extended by such court order, to be modified as provided in this Amendment.
3. Amendment to the Declaration. There are approximately four hundred ninety-nine (499) residential lots
in the portions of Tract 2283 affected by the Declaration. By their signatures hereto, more than 51 % of the owners of such
residential lots have determined to modify and amend the Declaration by modifying Paragraph 1 of said Declaration by
adding to the end of such paragraph, the following:
Provided, however, notwithstanding anything to the contrary contained in this Declaration of Restrictions,
there shall be allowed on the restricted Tots the subdivision, development, construction sate/lease and/or occupancy of up
to 73 single family lots upon which residential units may be constructed, all as is more particularly provided under City of
Palm Desert Department of Community Development Case Nos: C2 04-01, TT 31836, PP 04-01 and DA 04-01, (the
"Project") as such Project may be subsequently modified and finally approved by the City of Palm Desert.
4. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same instrument.
[Signatures Appear on Following Pages]
Tract 2283 - Page 1
IN WITNESS WHEREOF this Amendment to the Declaration of Restrictions is executed,
effective as of the day and year first written above.
OWNER(S):
Signature:
Signature:
FORM OF OWNERSHIP:
LEGAL DESCRIPTION OF OWNERS
LOT:
Lot , of Tract 2283, as shown
on Tract 2283 filed in the office of
County Recorder, Riverside County,
California on November 14, 1961, as
Instrument No. 98132
Assessor Parcel No:
Address:
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
) ss.
On , 200_, before me, , personally appeared
, personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
(SEAL)
My commission expires
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
) ss.
Notary Public in and for
the State of California
On , 200_, before me, personally appeared
, personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
(SEAL)
My commission expires
Notary Public in and for
the State of California
(Signature Page to Amendment to Declaration of Restrictions]
Tract 2283 - Page 2
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
PDCC Development, LLC
77200 Califomia Drive
Palm Desert, CA 92211
Space above this line for recorder's use
AMENDMENT TO DECLARATIONS OF RESTRICTIONS
Tract 2137
This Amendment to Declaration of Restrictions ("Amendment") is made this 4th day of June, 2004, by
undersigned property owners, comprising fifty-one percent (51 %) of owners of residential lots in Tract 2137.
1. Declaration of Restrictions. On, April 7, 1961, the Marne/ Development Co., a corporation
("Declarant") executed a Declaration of Restrictions ("Declaration") which was recorded on April 12, 1961 as
Instrument No. 31032 in the Official Records in the Office of the Recorder of Riverside County, State of California.
The Declaration sets forth certain restrictions regarding the use of certain real property, more particularly described
as Lots 73, 199, 261, 405 and 493 in Tract 2137 recorded in Book 41, pages 29 through 36 inclusive, records of
Riverside County.
2. Authority to Modify. Pursuant to the express terms of the Declaration, the restrictions lapsed as of
January 1,1992. The Declaration further provides that, from and after January 1, 1992, the restrictions are renewed
for successive five (5) year terms unless, at any time after January 1,1992, the owners of fifty-one percent (51%) or
more of the number of residential Tots in Tract 2137 determine in writing to supplement, change or rescind the
restrictions contained in the Declaration.
3. Amendment to the Declaration. There are approximately four hundred seventy (470) residential
Tots in the portions of Tract 2137 affected by the Declaration. By their signatures hereto, 51% or more of the owners
of such residential lots in Tract 2137 have determined to modify and amend the Declaration by modifying Paragraph
1 of said Declaration by adding to the end of such paragraph, the following:
Provided, however, notwithstanding anything to the contrary contained in this Declaration of
Restrictions, there shall be allowed on the restricted lots, the subdivision, development, construction sale/lease
and/or occupancy of up to 17 single family Tots upon which residential units may be constructed, all as is more
particularly provided under City of Palm Desert Department of Community Development Case Nos: C/Z 04-01, TT
31836, PP 04-01 and DA 04-01, (the "Project") as such Project may be modified and finally approved by the City of
Palm Desert.
4. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same instrument.
[Signatures Appear on Following Pages]
Tract 2137 - Page 1
IN WITNESS WHEREOF this Amendment to the Declaration of Restrictions is executed,
effective as of the day and year first written above.
OWNER(S):
Signature:
Signature:
FORM OF OWNERSHIP:
LEGAL DESCRIPTION OF OWNERS
LOT:
Lot , of Tract 2137, as shown on
Tract 2137 filed in the office of County
Recorder, Riverside County, California
on December 28, 1960, as Instrument
No. 109220
Assessor Parcel Number:
Address:
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
)
) ss.
On , 200_, before me, , personally appeared
, personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
(SEAL)
My commission expires
STATE OF CALIFORNIA
COUNTY OF RIVERSIDE
) ss.
Notary Public in and for
the State of Califomia
On , 200_, before me, , personally appeared
, personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
(SEAL)
My commission expires
Notary Public in and for
the State of Califomia
[Signature Page to Amendment to Declaration of Restrictions]
Tract 2137 - Page 2
{
July 8, 2004
Palm Desert City Council:
Robert A. Spiegel, Mayor
Buford A. Crites, Mayor Pro Tem
Jean M. Benson, Councilmember
Jim Ferguson, Councilman
Richard S. Kelly, Councilman
ity of Palm Desert
73-510 Fred Waring Dr.
Palm Desert, CA 92260-2578
a'ti`ED
...CITY CLERK'S OFFICE
PA' F' !DESERT, CA
297i JUL —3 PM 2: 39
RE: July 8, 2004 Public Hearing
Objection to Palm Desert Country Club (PDCC) Proposed Zoning Change
Case Nos. C/Z 04-01, TT 31836 and DA 04-01
Dear Mayor and Members of the City Council,
This letter is to supply additional information on the conservation easement tax
credits described in our June 24, 2004 letter to the City Council, which the Council
should be aware of. We will not be able to attend the hearing tonight as we have a
prior commitment and just learned of this hearing yesterday. However, we request
that this letter be entered into the record to be part of tonight's proceedings.
Please review the attached documents. In particular, please read the two starred
("*") paragraphs that pertain directly to this project.
1. The article from the Washington Post entitled "IRS Targets Conservation
Gifts", dated July 1, 2004.
2. IRS Notice 2004-41, dated June 30, 2004, including Section 1.170A-14(h)(3)(i)
and Section 1.170A-14(h)(3)(ii) of the IRS Code.
Once again, this land serves no conservation purpose. It has been a golf course for
over 40 years and the conservation easement has no material effect on the value of
the real property. It is fragmented and has no connectivity with other land sources.
We believe that a tax deduction for this property for a conservation easement is a
fraudulent taking of taxpayers' money by the owners/developers.
Sincerely,
Richard and Lola Green
42025 Tennessee Ave.
Palm Desert, CA 92211
Email: lola.green@earthlink.net
1
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http://www.billingsgazette.com/index.php?display=rednews/2004/0710'1/build/nationl70-irs-
gifts.inc
IRS targets conservation gifts
The Washington Post 1-`a- t! ctlt
WASHINGTON - The Internal Revenue Service announced Wednesday it is cracking down on improper tax
deductions taken by people who give real estate and cash to environmental groups, warning that taxpayers could
face penalties and charities could lose their tax-exempt status.
The IRS is specifically targeting gifts of "conservation easements" - deed restrictions that limit some types of real
estate development. The easements have become the environmental movement's key tool for preserving millions
of acres of open space and fragile ecosystems.
The IRS is focusing on easements that have questionable public benefit or have been manipulated to generate
inflated deductions.
"We've uncovered numerous instances where the tax benefits of preserving open spaces and historic buildings
have been twisted for inappropriate individual benefit," IRS Commissioner Mark Everson said in a statement.
"Taxpayers who want to game the system and the charities that assist them will be called to account."
The IRS warned that it intends to levy penalties on charity executives and board members who knowingly help
secure improper deductions claimed in connection with such transactions.
The announcement did not name any individual taxpayers or charities. It comes as the IRS is conducting a major
audit of the Nature Conservancy, the world's largest environmental organization.
The Washington Post reported last year that the conservancy, based in suburban Arlington, Va., had repeatedly
bought land, added some development restrictions, then resold the properties at reduced prices to its trustees
and other supporters. The buyers made cash gifts to the Conservancy roughly equal to the difference in price,
thereby qualifying for substantial tax deductions just as if they had donated to their local charity.
The conservancy said the sales prices were proper because the development restrictions reduced the market
value of the tracts.
But in the wake of the news articles, the conservancy announced it would not conduct such deals with its board
members and trustees.
Former IRS Commissioner Sheldon Cohen called Wednesdays announcement an unusually strong action,
adding, "It is pretty obvious who it is aimed at."
On Wednesday, conservancy spokesman James Petterson said executives there were still studying the IRS
action. 'The Nature Conservancy over the last decade has received several legal opinions reflecting other
interpretations of the law," Petterson said. "We are reviewing what the IRS issued, assessing its impact on our
programs and determining appropriate actions."
The IRS said Wednesday it "intends to disallow" and assess tax penalties for improper tax deductions claimed
for gifts of easements to charities. Easements that serve no conservation purpose and create no significant
public benefit do not qualify for tax deductions, the agency said.
Some taxpayers have claimed deductions for amounts that exceed the value of the restrictions placed on their
land, the IRS added.
http://www.billingsgazette.com/printer.php?id=l &display=rednews/2004/07/.../70-irs-gifts.tx 7/8/2004
Part lll- Administrative, Procedural, and Miscellaneous
Charitable Contributions and Conservation Easements
Notice 2004-41
The Internal Revenue Service is aware that taxpayers who (1) transfer an
easement on real property to a charitable organization, or (2) make payments to a
charitable organization in connection with a purchase of real property from the
charitable organization, may be improperly claiming charitable contribution deductions
under § 170 of the Internal Revenue Code. The purpose of this notice is to advise
participants in these transactions that, in appropriate cases, the Service intends to
disallow such deductions and may impose penalties and excise taxes. Furthermore, the
Service may, in appropriate cases, challenge the tax-exempt status of a charitable
organization that participates in these transactions. In addition, this notice advises
promoters and appraisers that the Service intends to review promotions of transactions
involving these improper deductions, and that the promoters and appraisers may be
subject to penalties.
Contributions of Conservation Easements
Section 170(a)(1) allows as a deduction, subject to certain limitations and
restrictions, any charitable contribution (as defined in § 170(c)) that is made within the
taxable year. Generally, to be deductible as a charitable contribution under § 170, a
transfer to a charitable organization must be a gift of money or property without receipt
or expectation of receipt of adequate consideration, made with charitable intent. See
U.S. v. American Bar Endowment, 477 U.S. 105, 117-18 (1986); Hernandez v.
Commissioner, 490 U.S. 680, 690 (1989); see also § 1.170A-1(h)(1) and (2) of the
Income Tax Regulations.
Section 170(f)(3) provides generally that no charitable contribution deduction is
allowed for a transfer to a charitable organization of Tess than the taxpayer's entire
interest in property. Section 170(f)(3)(B)(iii) provides an exception to this rule in the
case of a qualified conservation contribution.
A qualified conservation contribution is a contribution of a qualified real property
interest to a qualified organization exclusively for certain conservation purposes.
Section 170(h)(1), (2), (3), and (4); § 1.170A-14(a). A qualified real property interest
includes a restriction (granted in perpetuity) on the use that may be made of the real
property. Section 170(h)(2)(C); see also § 1.170A-14(b)(2). For purposes of this notice,
qualified real property interests described in § 170(h)(2)(C) are referred to as
conservation easements.
2
One of the permitted conservation purposes listed in § 170(h)(4) is the protection
of a relatively natural habitat of fish, wildlife, or plants, or similar ecosystem. Section
170(h)(4)(A)(ii); see also § 1.170A-14(d)(1)(ii) and (3). Another of the permitted
conservation purposes is the preservation of open space ("open space easement"),
including farmland and forest land, for the scenic enjoyment of the general public or
pursuant to a clearly delineated governmental conservation policy. However, if the
public benefit of an open space easement is not significant, the charitable contribution
deduction will be disallowed. See § 170(h)(4)(A)(iii); see also § 1.170A-14(d)(1)(iii) and
(4)(iv), (v), and (vi). Section 170(h) and § 1.170A-14 contain many other requirements
that must be satisfied for a contribution of a conservation easement to be allowed as a
deduction.
A charitable contribution is allowed as a deduction only if substantiated in
accordance with regulations prescribed by the Secretary. Section 170(a)(1) and (f)(8).
Under § 170(f)(8), a taxpayer must substantiate its contributions of $250 or more by
obtaining from the charitable organization a statement that includes (1) a description of
any return benefit provided by the charitable organization, and (2) a good faith estimate
of the benefit's fair market value. See § 1.170A-13 for additional substantiation
requirements. In appropriate cases, the Service will disallow deductions for
conservation easement transfers if the taxpayer fails to comply with the substantiation
requirements. The Service is considering changes to forms to facilitate compliance with
and enforcement of the substantiation requirements.
If all requirements of § 170 are satisfied and a deduction is allowed, the amount
of the deduction may not exceed the fair market value of the contributed property (in this
case, the contributed easement) on the date of the contribution (reduced by the fair
market value of any consideration received by the taxpayer). See § 1.170A-1(c)(1),
(h)(1) and (2). Fair market value is the price at which the contributed property would
change hands between a willing buyer and a willing seller, neither being under any
compulsion to buy or sell, and each having reasonable knowledge of relevant facts.
Section 1.170A-1(c)(2). See § 1.170A-14(h)(3) and (4) for a discussion of valuation.
If the donor (or a related person) reasonably can expect to receive financial or
economic benefits greater than those that will inure to the general public as a result of
the donation of a conservation easement, no deduction is allowable. Section 1.170A-
14(h)(3)(i). If the donation of a conservation easement has no material effect on the
value of real property, or enhances rather than reduces the value of real property, no
deduction is allowable. Section 1.170A-14(h)(3)(ii).
Purchases of Real Property from Charitable Organizations
Some taxpayers are claiming inappropriate charitable contribution deductions
under § 170 for cash payments or easement transfers to charitable organizations in
connection with the taxpayers' purchases of real property.
3
In some of these questionable cases, the charitable organization purchases the
property and places a conservation easement on the property. Then, the charitable
organization sells the property subject to the easement to a buyer for a price that is
substantially Tess than the price paid by the charitable organization for the property. As
part of the sale, the buyer makes a second payment, designated as a "charitable
contribution," to the charitable organization. The total of the payments from the buyer to
the charitable organization fully reimburses the charitable organization for the cost of
the property.
In appropriate cases, the Service will treat these transactions in accordance with
their substance, rather than their form. Thus, the Service may treat the total of the
buyer's payments to the charitable organization as the purchase price paid by the buyer
for the property.
Penalties, Excise Taxes, and Tax -Exempt Status
Taxpayers are advised that the Service intends to disallow all or part of any
improper deductions and may impose penalties under § 6662.
The Service intends to assess excise taxes under § 4958 against any disqualified
person who receives an excess benefit from a conservation easement transaction, and
against any organization manager who knowingly participates in the transaction. In
appropriate cases, the Service may challenge the tax-exempt status of the organization,
based on the organization's operation for a substantial nonexempt purpose or
impermissible private benefit.
In addition, the Service intends to review promotions of transactions involving
improper deductions for conservation easements. Promoters, appraisers, and other
persons involved in these transactions may be subject to penalties under §§ 6700,
6701, and 6694.
DRAFTING INFORMATION
The principal author of this notice is Patricia M. Zweibel of the Office of Associate
Chief Counsel (Income Tax & Accounting). For further information regarding this notice,
contact Ms. Zweibel at (202) 622-5020 (not a toll -free call).
Jul 0$ 04 03:24p
City Builders/Cruse Exper 415 457-6981 p.l
July 8, 2004
City of Palm Desert
Robert A Spiegel, Mayor
Buford A Crites, Mayor Pro Tem
Richard S Kelly, Council Member
Jean M Benson, Council Member
Jim Ferguson, Council Member
RE: PDCC Development, LLC
Dear Mayor & Council Members:
Yesterday morning I became aware of a letter that has been placed at the doors
of many homes in Palm Desert Country Club. A copy of this letter is enclosed.
The letter contains deceptive language about the City of Palm Desert requesting
homeowners to alter the declarations which protect the golf course lots.
The letter reads "As a courtesy to you, the Palm Desert City Council has asked
us to bring a notary to you, at no cost, to obtain your signature(s)." According to
Carlos Ortega, he has read the letter and has no knowledge of any such request
by the City of Palm Desert.
This statement by Palm Desert Country Club Development, LLC is highly
deceptive and is being used to manipulate the owners of property in tracts 2137
and 2283 into signing a document giving away their rights under the Declaration
of Restrictions to not have any additional homes built within the tracts. It is being
done under the auspices of being sanctioned by the City of Palm Desert.
The reference that the Palm Desert City Council has requested their notarized
signatures would in many cases persuade property owners to sign away their
rights without understanding the consequences of their actions as they trust the
City of Palm Desert and will cooperate when asked to by their civic leaders.
The letter also states "The deed to your home contains a clause which expired in
1990, and will be modified." This is also incorrect; the Declaration of Restrictions
is still a valid document and is in force today. The overall effect is to make
homeowner's believe that the City has made a determination about the effect of
the declarations.
2
Received Jul-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 01
J,u,1 08 04 03:24p
City Builders/Cruse Exper 415 457-6981
p.2
This same paragraph ends with "The deed restriction will not be removed, merely
modified." If this is the case the City as well as all the property owners of Palm
Desert Country Club Association should have clear knowledge of what this
modification to the deed restriction says. The actual document is being
circulated surreptitiously so as to avoid any countering of its purpose. This
representation that the deed restriction will be "modified" is also counter to Palm
Desert Country Club Development, LLC's claim that the original item #17 could
not be a part of the Development Agreement passed by the Palm Desert City
Council on June 24, 2004 as it would preclude them from using an IRS credit for
preservation of open space.
If the City does not take action in regards to this misrepresentation, many
homeowners will be deceived into thinking that the City of Palm Desert has
indeed asked for their signatures.
On another matter, it came to my attention today that a packet of information was
given to City Council members at some time on or after June 24, 2004. Attached
to this letter is a one -page document from this packet titled "Salient Facts". In
this document there are many false accusations about myself and Jerome
Pineau. So as not to leave the impression that these accusations are correct if
left uncontroverted, I will touch on them very briefly:
We have never had any conflict or even contact with ANY other developer, and
have no experience "holding developers hostage for cash."
We were not at all "shaking down developer for $1,000,000+ cash settlement in
exchange for not stopping project". In fact we repeatedly told the developers that
all that we wanted was the removal of some of the homes in the driving range.
We even gave them a proposal that all involved property owners in the driving
range agreed to which amounted to the removal of 17 new home sites. This
proposal would place all property lines of the new home sites at 250 feet from
any existing property. The developers told us that they would not even consider
the removal of even ONE new home site for us and THEY requested that we
propose a cash settlement amount that would be sufficient for our entire group.
The statement "Theodoratus fail (sic.) to disclose that developed (sic.) dropped
building sites and pulled the development to grant her request for a longer view
shed". The truth is that the developers dropped one home site in the entire
driving range for the benefit of Claudette Whiston at 77160 Indiana. They also
angled the home sites away from her view shed again at her request and
lowered the rooflines 3 feet, as the homeowners on Indiana would have been 4
1h feet below the grade level of the new homes. The distance from my lot to the
closest lot was lengthened by only about 10 feet.
The statement, "Theodoratus failed to disclose that developer offered her
numerous options: buy her home and/or an option at fair market value: or an
Received JuI-08-04 03:02pm
From-415 457 6981 To —PALM DESERT CITY CLE Page 02
Jul. 08 04 03:24p
Citu Builders/Cruse Exper 415 457-6881 p.3
opportunity to choose a new home." The developers did indeed offer to
purchase my home for the appraised value of $241,000 + 10% to be paid after
construction. As you may know the property values in PDCC have now gone
over $300,000 for property on the golf course making this an unreasonable offer
as everyone knows that housing prices are escalating and would have
outstripped the $241,000.00 option price before the developers ever broke
ground. I was never given any offer to "choose a new home".
Please do not be deceived by the continuing efforts of the developers to silence a
group of Palm Desert residents who are being victimized by this project.
Lisa Theodoratus
Received Jul-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 03
J,u,1 08 04 03:24p
City Builders/Cruse Exper 415 457-6981 p.4
Hello Neighbor,
Sorry we missed you!
APflt
Paim Desert
Country Club
Development LLC
As you may or may not know, the new development and renovation of Palm Desert
Country Club was approved by our City Council on Thursday, June 24, 2004. Tracts
2137 and 2283 fall within this development. The deed to your home contains a clause
which expired in 1990, and will be modified. As a courtesy to you, the Palm Desert City
Council has asked us to bring a notary to you, at no cost, to obtain your signature(s).
The deed restriction will not be removed, merely modified.
We are available from 9:00 a.m: 12:00 noon, and from 5:00 until approximately 7:00
p.m. If these times are inconvenient for you, we will come to your home in a time
frame that suits you. Simply call Scott Johnson, General Manager, Palm Desert Country
Club, to set an appointment - (760) 272-6819 or, e-mail him at PDCCPRO@AOL.com,
and a representative from Palm Desert Country Club and Palm Desert Country Club
Development, LLC, along with a Notary Public will stop by. Once again, this service is
free of charge.
Attached are renderings of the new Club House, and the new homes being developed.
Please take a few minutes to look at the areas involved. The new homes being built
will be modified in your current deed restriction. Should you have any questions, please
feel free to call.
Thank you for your anticipated prompt response.
Palm Desert Country Club Development LLC and Palm Desert Country Club
,.a
Received Jul-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 04
Jul. 08 04 03:25p
07/07/2004 21:41 7607765420 JESA PRINTING
City Builders/Cruse Exper 415 457-6981 p•5
PAGE 02
SALIENT FACTS
THE PROJECT:
• Enhances the golf course, the clubhouse and the community.
• Brings 95 new homeowners to Palm Desert.
a Creates substantial jobs for the construction industry.
• Creates substantial long-term jobs for the golf course and clubhouse.
• Revitalizes a tired community and brings excitement back to the people.
THE NAYSAVERS:
• "Shaking down developer for $1,000,000+ cash settlement in exchange for not
stopping project.
• Has sued developer for "monetary, declaratory, injunctive and punitive remedies".
• Pineau and Theodoratus are experienced in holding developers hostage for cash.
• Inciting fear within the community telling homeowners their property rights will be lost.
• Caused a panic within the community by misinforming property owners about home values.
• Pineau failed to advise Council that developer met with him many times, often in the
company of City Staff and/or their attorney to satisfy his concerns.
• Pineau failed to advise Council that developer forfeited a building site adjacent to his home
to satisfy his concerns.
• Theodoratus failed to disclose the many meetings developer had with her in the presence of
her attorney and City Staff to satisfy her concerns.
• Theodoratus failed to disclose that developed dropped building sites and pulled the
development to grant her request for a longer view shed.
• Theodoratus failed to disclose that developer offered her numerous options: buy her home
and/or an option at fair market value: or an opportunity to choose a new home.
• Pineau and Theodoratus failed to disclose that they attended and disrupted many
community meetings held by the developer.
• Pineau has made unfounded accusations in written handouts and on his website attacking
the developer's ethics and misleading the public about the project.
• Escobedo falsified an address.
• Cray falsified a claim to be a homeowner.
THE COUNCIL'S CONCERNS:
• Naysayers: Extensive efforts have been done to satisfy naysayers, to no avail.
• Item 17: Not a problem - but developer requires use of Preservation Easement.
• Budget: currently being reviewed by third party CPA and Phil Drell.
• Storage facility: Merely a relocation and improvement of an existing facility, which received
unamimous approval of the Design Review Committee.
THE DEVELOPER'S CONCERNS:
• Cost of lawsuit with naysayers will be substantial in terms of money and time.
• Class action suit of homeowners against naysayers will tie up property for years.
• Investors have grown tired of never-ending delays with project.
• Developer is apprehensive to continue spending money on a losing battle,
• Developers property and personal safety have been threatened.
• Developer feels their professional work ethic, substantial investment and quality product
have not earned due respect from Council.
Received JuI-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 05
Ju,1 08 04 03:25p City Builders/Cruse Exper 415 457-6981 p•6
Treasury and IRS Issue Notice Regarding Improper Deductions for Conservation Easeme... Page 1 of 2
DInternal Revenue Service IRS.gov
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17.711
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The
Treasury and IRS Issue Notice Regarding Imt
Deductions for Conservation Easement Donati
IR-2004-86, June 30, 2004
WASHINGTON — Today the Treasury Department and the Internal
Revenue Service issued a notice to advise taxpayers that the IRS intends 1
disallow improper charitable contribution deductions for transfers of
easements on real property to charitable organizations and for transfers 01
easements in connection with purchases of real property from charitable
organizations. Taxpayers claiming improper charitable contribution
deductions for such transfers may be subject to accuracy -related penaltieE
"We've uncovered numerous instances where the tax benefits of preservi:
open spaces and historic buildings have been twisted for inappropriate
individual benefit," said IRS Commissioner Mark W. Everson. "Taxpaye
who want to game the system and the charities that assist them will be cal
to account"
The IRS is aware that some taxpayers are claiming inappropriate charitab
contribution deductions for easement transfers that do not qualify as quail
conservation contributions, or are claiming deductions for amounts that
exceed the fair market value of the donated easement.
In addition, the IRS is aware that some taxpayers are claiming inappropri.
charitable contribution deductions for cash payments or easement transfer
charitable organizations in connection with the taxpayers' purchases of re
property.
The IRS may impose penalties on promoters, appraisers and other person
involved in these transactions. In appropriate cases, the IRS may challenE
the tax-exempt status of the charitable organization, based on the
organization's operation for a substantial nonexempt purpose or
impermissible private benefit.
One of the agency's four service -wide enforcement priorities is to discour
and deter non-compliance within tax-exempt and government entities anc
misuse of such entities by third parties for tax avoidance and other
file: //C: \WINDOWS\Temporary%20lnternet%20Fi1es\Content.IE5\W 567WDMZ\Treasu... 07/08/2004
Received JuI-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 06
JUL 08 04 03:25p Citd Builders/Cruse Exper 415 457-6981
Treasury and IRS Issue Notice Regarding Improper Deductions for Conservation Easeme...
p.7
Page 2 of 2
Forms and Publications
Where To File
Contact My Local
Office
Frequently Asked
Questions
I' :payer Advocate
unintended purposes.
Related Item: Notice 2004-41 (PDF 64K) — Charitable Contributions ai
Conservation Easements
Subscribe to IRS Newswire
IB.S P 'vacy Paligy Contact Us
file://C:\WINDOWS\Temporary%20lnternet%20Files\Content.IE5\W 567W DMZ\Treasu. _ . 07/08/2004
Received Jul-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 07
'Jul 08 04 03:24p
City Builders/Cruse Exper 415 457-6981 p.l
July 8, 2004
City of Palm Desert
Robert A Spiegel, Mayor
Buford A Crites, Mayor Pro Tem
Richard S Kelly, Council Member
Jean M Benson, Council Member
Jim Ferguson, Council Member
RE: PDCC Development, LLC
Dear Mayor & Council Members:
Yesterday morning I became aware of a letter that has been placed at the doors
of many homes in Palm Desert Country Club. A copy of this letter is enclosed.
The letter contains deceptive language about the City of Palm Desert requesting
homeowners to alter the declarations which protect the golf course lots.
The letter reads "As a courtesy to you, the Palm Desert City Council has asked
us to bring a notary to you, at no cost, to obtain your signature(s)." According to
Carlos Ortega, he has read the letter and has no knowledge of any such request
by the City of Palm Desert.
CO
This statement by Palm Desert Country Club Development, LLC is highly
deceptive and is being used to manipulate the owners of property in tracts 2137
and 2283 into signing a document giving away their rights under the Declaration
of Restrictions to not have any additional homes built within the tracts. It is being
done under the auspices of being sanctioned by the City of Palm Desert.
The reference that the Palm Desert City Council has requested their notarized
signatures would in many cases persuade property owners to sign away their
rights without understanding the consequences of their actions as they trust the
City of Palm Desert and will cooperate when asked to by their civic leaders.
The letter also states "The deed to your home contains a clause which expired in
1990, and will be modified." This is also incorrect; the Declaration of Restrictions
is still a valid document and is in force today. The overall effect is to make
homeowner's believe that the City has made a determination about the effect of
the declarations.
Received JuI-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 01
Jul be 04 03:24p
Citti Builders/Cruse Exper 415 457-6981 p•2
This same paragraph ends with "The deed restriction will not be removed, merely
modified." If this is the case the City as well as all the property owners of Palm
Desert Country Club Association should have clear knowledge of what this
modification to the deed restriction says_ The actual document is being
circulated surreptitiously so as to avoid any countering of its purpose. This
representation that the deed restriction will be "modified" is also counter to Palm
Desert Country Club Development, LLC's claim that the original item #17 could
not be a part of the Development Agreement passed by the Palm Desert City
Council on June 24, 2004 as it would preclude them from using an IRS credit for
preservation of open space.
If the City does not take action in regards to this misrepresentation, many
homeowners will be deceived into thinking that the City of Palm Desert has
indeed asked for their signatures.
On another matter, it came to my attention today that a packet of information was
given to City Council members at some time on or after June 24, 2004. Attached
to this letter is a one -page document from this packet titled "Salient Facts". In
this document there are many false accusations about myself and Jerome
Pineau. So as not to leave the impression that these accusations are correct if
left uncontroverted, I will touch on them very briefly:
We have never had any conflict or even contact with ANY other developer, and
have no experience "holding developers hostage for cash."
We were not at all "shaking down developer for $1,000,000+ cash settlement in
exchange for not stopping project". In fact we repeatedly told the developers that
all that we wanted was the removal of some of the homes in the driving range.
We even gave them a proposal that all involved property owners in the driving
range agreed to which amounted to the removal of 17 new home sites. This
proposal would place all property lines of the new home sites at 250 feet from
any existing property. The developers told us that they would not even consider
the removal of even ONE new home site for us and THEY requested that we
propose a cash settlement amount that would be sufficient for our entire group_
The statement "Theodoratus fail (sic.) to disclose that developed (sic.) dropped
building sites and pulled the development to grant her request for a longer view
shed". The truth is that the developers dropped one home site in the entire
driving range for the benefit of Claudette Whiston at 77160 Indiana. They also
angled the home sites away from her view shed again at her request and
lowered the rooflines 3 feet, as the homeowners on Indiana would have been 4
% feet below the grade level of the new homes. The distance from my lot to the
closest lot was lengthened by only about 10 feet.
The statement, "Theodoratus failed to disclose that developer offered her
numerous options: buy her home and/or an option at fair market value: or an
Received Jul-08-04 03:02pm
From-415 457 6981 To —PALM DESERT CITY CLE Page 02
Jul 08 04 03:24p
City Builders/Cruse Exper 415 457-6981 p • 3
opportunity to choose a new home." The developers did indeed offer to
purchase my home for the appraised value of $241,000 + 10% to be paid after
construction. As you may know the property values in PDCC have now gone
over $300,000 for property on the golf course making this an unreasonable offer
as everyone knows that housing prices are escalating and would have
outstripped the $241,000.00 option price before the developers ever broke
ground. I was never given any offer to "choose a new home".
Please do not be deceived by the continuing efforts of the developers to silence a
group of Palm Desert residents who are being victimized by this project.
Lisa Theodoratus
Received Jul-08-04 03:02pm
From-415 457 6981 To —PALM DESERT CITY CLE Page 03
Jul 08 04 03:24p
Cir.y Builders/Cruse Exper 415 457-6981 p.4
Hello Neighbor,
Sorry we missed you!
Paim D¢sert
Country Club
Development LLC
As you may or may not know, the new development and renovation of Palm Desert
Country Club was approved by our City Council on Thursday, June 24, 2004. Tracts
2137 and 2283 fall within this development. The deed to your home contains a clause
which expired in 1990, and will be modified. As a courtesy to you, the Palm Desert City
Council has asked us to bring a notary to you, at no cost, to obtain your signature(s).
The deed restriction will not be removed, merely modified.
We are available from 9:00 a.m.-12:00 noon, and from 5:00 until approximately 7:00
p.m. If these times are inconvenient for you, we will come to your home in a time
frame that suits you. Simply call Scott Johnson, General Manager, Palm Desert Country
Club, to set an appointment - (760) 272-6819 or, e-mail him at PDCCPROc AOL.com,
and a representative from Palm Desert Country Club and Palm Desert Country Club
Development, LLC, along with a Notary Public will stop by. Once again, this service is
free of charge.
Attached are renderings of the new Club House, and the new homes being developed.
Please take a few minutes to look at the areas involved. The new homes being built
will be modified in your current deed restriction. Should you have any questions, please
feel free to call.
Thank you for your anticipated prompt response.
Palm Desert Country Club Development LLC and Palm Desert Country Club
Received Jui-08-04 03:02pm
From-415 457 6981 To -PALM DESERT CITY CLE Page 04
Ju.l 08 04 03:25p
07/07/2004 21:41 760776 JESA PRINTING
Citti Builders/Cruse Exper 415 457-6981 P • 5
PAGE 02
SALIENT FACTS
THE PROJECT:
• Enhances the golf course, the clubhouse and the community.
• Brings 95 new homeowners to Palm Desert.
• Creates substantial jobs for the construction industry.
• Creates substantial long-term jobs for the golf course and clubhouse.
• Revitalizes a tired community and brings excitement back to the people.
THE NAYSAYERS:
• "Shaking down developer for $1,000,000+ cash settlement in exchange for not
slopping project
• Has sued developer for "monetary, declaratory, injunctive and punitive remedies".
• Pineau and Theodoratus are experienced in holding developers hostage for cash.
• Inciting fear within the community telling homeowners their property rights will be lost.
• Caused a panic within the community by misinforming property owners about bome values.
• Pineau failed to advise Council that developer met with him many times, often in the
company of City Staff and/or their attorney to satisfy his concerns.
• Pineau failed to advise Council that developer forfeited a building site adjacent to his home
to satisfy his concerns.
• Theodoratus failed to disclose the many meetings developer had with her in the presence of
her attorney and City Staff to satisfy her concerns.
• Theodoratus failed to disclose that developed dropped building sites and pulled the
development to grant her request for a longer view shed.
• Theoduratus failed to disclose that developer offered her numerous options: buy her home
and/or an option at fair market value: or an opportunity to choose a new home.
• Pineau and Theodoratus failed to disclose that they attended and disrupted many
community meetings held by the developer.
Pineau has made unfounded accusations in written handouts and on his website attacking
the developer's ethics and misleading the public about the project.
• Escobedo falsified an address.
• Cray falsified a claim to be a homeowner.
THE COUNCIL'S CONCERNS:
• Naysayers: Extensive efforts have been done to satisfy naysayers, 10 no avail.
• Item 17: Not a problem - but developer requires use of Preservation Easement.
• Budget: currently being reviewed by third party CPA and Phil Drell.
• Storage facility: Merely a relocation and improvement of an existing facility, which received
unamimous approval of the Design Review Committee.
THE DEVELOPER'S CONCERNS:
• Cost of lawsuit with naysayers will be substantial in terms of money and time.
• Class action suit of homeowners against naysayers will tie up property for years.
• Investors have grown tired of never-ending delays with project.
• Developer is apprehensive to continue spending money on a losing battle.
• Developers property and personal safety have been threatened.
• Developer feels their professional work ethic. substantial investment and quality product
have not earned due respect from Council.
Received JuI-08-04 03:02pm From-415 457 6981
To -PALM DESERT CITY CLE Page 05
Jul 08 04 03:25p City Builders/Cruse Exper 415 457-6981 p-6
Treasury and IRS Issue Notice garding Improper Deductions for Con: ation Easeme... Page 1 of 2
Internal Revenue Service IRS.gov
.. Home I Tax Stats About IRS ! freers 1 FOIA I The Newsroom I Accessibility. I Si
Math [ Espanol [ Help
u Search IRS Site for:
-I
a Search Forms and
0 Publications for:
Tars for puccesaful searchies
Home > The Newsroom
!TA Infnrmatinn fnr
What's Hot
News Releases
IRS - The B.asics
IRS Guidance
Media Contacts
Facts & Figures
problem Alerts
Around the Nation
e-News Subscriptions
0
r 1 RAInfnel Tnnirm J 0
Tix Tips 2004
Eat Sheets
Armed Forces
Disaster Relief
Offshore Compliance
Scams / Consumer
Alerts
Tax Shelters
More Topics . .
U
1 l n--
e-file
The
Treasury and IRS Issue Notice Regarding ImI
Deductions for Conservation Easement Donati
IR-2004-86, June 30, 2004
WASHINGTON — Today the Treasury Department and the Internal
Revenue Service issued a notice to advise taxpayers that the IRS intends I
_ disallow improper charitable contribution deductions for transfers of
easements on real property to charitable organizations and for transfers of
easements in connection with purchases of real property from charitable
organizations. Taxpayers claiming improper charitable contribution
deductions for such transfers may be subject to accuracy -related penalties
"We've uncovered numerous instances where the tax benefits of preservi:
open spaces and historic buildings have been twisted for inappropriate
_ individual benefit," said IRS Commissioner Mark W. Everson. "Taxpaye
who want to game the system and the charities that assist them will be cal
to account."
The IRS is aware that some taxpayers are claiming inappropriate charitab
contribution deductions for easement transfers that do not qualify as quali
conservation contributions, or are claiming deductions for amounts that
exceed the fair market value of the donated easement.
In addition, the IRS is aware that some taxpayers are claiming inappropri.
charitable contribution deductions for cash payments or easement transfer
charitable organizations in connection with the taxpayers' purchases of re
property.
The IRS may impost penalties on promoters, appraisers and other person
involved in these transactions. In appropriate cases, the IRS may challenp
the tax-exempt status of the charitable organization, based on the
organization's operation for a substantial nonexempt purpose or
impermissible private benefit.
One of the agency's four service -wide enforcement priorities is to discoui
and deter non-compliance within tax-exempt and government entities anc
misuse of such entities by third parties for tax avoidance and other
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Related Item: Notice 2004-41 (PD1 64K) — Charitable Contributions ai
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