On sunny days, the Grand Venezia at Baywatch condominiums offer a view of Old Tampa Bay that calms the mind. “It’s just gorgeous,” resident Don Dwyer said recently. “One morning I sat on my balcony for two hours. I saw five manatees, 12 dolphins and I can’t tell you how many stingrays.” But the history of Grand Venezia is anything but fun or soothing. Instead, it’s complicated and contentious, with twists that just keep coming, starting with the two con men now serving 40 years in prison for running a nationwide Ponzi scheme. Along the way, they talked about turning the Grand Venezia, which is east of U.S. 19 near Belleair Road and Clearwater’s southern boundary, into a 5-star resort with a water park, canals with gondoliers, a hotel, spa, convention facilities and shopping to rival Rodeo Drive. None of those fancy extras ever got built, but the swindlers did borrow nearly $34 million for other expenses from the municipal bond market before their plans imploded. More than a decade later, condo owners are still paying off the bonds to the tune of nearly $1,100 a year. For years, attorneys have argued about whether residents have anything to show for their money. The answer is no, Dwyer says. Late last year he and a couple of like-minded others gained control of the board of Grand Venezia’s community development district, a special purpose government created to set the assessments that pay off the bonds. This month, the district took the virtually unheard-of step of filing for bankruptcy under Chapter 9 of the federal bankruptcy code, which concerns local government debt. The goal, according to court pleadings, is to recalculate the assessments. That’s not as drastic as walking away from the debt, but even its champion says it’s an extreme act. “I call it the nuclear option,” says Dwyer, who until this week served as chairman of the board of the community development district for Grand Venezia and some nearby commercial property. The bonds are owned by OppenheimerFunds, which itself was bought last month by investment giant Invesco. The company declined to comment, but one of its lawyers last year warned the district’s board against thinking, “We don’t have to pay our debts.” Do that, Oppenheimer attorney Brian Crumbaker said, and “every city, county, School Board, (and) 600 community development districts in Florida … would be doing the same thing.”
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