Tiered Maint fees [Presidential Villas at Plantation Resort, Surfside Beach SC]

Pure point programs are basically tier MFs. Mud and off season weeks are less points, and thus less MFs. Prime weeks (ski or summer) are higher points values and thus higher MFs.

I think anything with fixed weeks need to consider Red + off week packaging of weeks to keep everyone in play and get the blue week MFs paid for.

I had a resort that just eliminated blue weeks and closed the resort during those months, what few blue owners they had were moved to white weeks. Now there is still insurance etc during blue weeks, but less overall costs for staff and maintenance.

It's one thing if a tiered system was in place at the time a resort was sold. Completely different to add it in later. I cannot imagine a vote for this actually passing. The summer float range alone at Presidential Villas is weeks 20 to 38. That's a huge range of owners who will not vote in favor. The point is, there are other things that can be done to make it more attractive to own off season.

Okay -- my idea.

Close 75% of the resort for 7 weeks in Jan (after the NYE weekend) until just before the first weekend of March 1st. (whatever to not winterized) ...

Bank units with RCI - depositing time in late Sept-end of Dec (and a limited number of Jan-Feb). Offer (rent) those TPUs to the PAYING owners.

The resort HAS the occupancy history over all those years - run the numbers - basicly depositing time the resort is underlized and using the empties to generate TPUs which are then transfer to members who would like to pay an extra (discounted) MF for trading that year. Resort would have NEW guests (the RCI exchangers or Extra Vacation renters) - would look like it was an active place.

And get the local businesses to offer "discounts", tours, cooking demos, ice fishing adventures, Wine & cheese tastings, Bridge tournament (or another card game), ghost story (perhaps at bed & breakfast sites), candle making, movie night with free popcorn, karoke night, Popluck dinner night, etc Use the lobby - use the unit next to the lobby - re-set storage or office space ...

The resort is not a year round SUMMER resort and the staff gets paid to sit and do little during the slow seasons - WHAT a nice benefit - just work for 3-4 months a year. Put them to work so their jobs will be there in the future years.

bonk2boy said:

It's one thing if a tiered system was in place at the time a resort was sold. Completely different to add it in later. I cannot imagine a vote for this actually passing. The summer float range alone at Presidential Villas is weeks 20 to 38. That's a huge range of owners who will not vote in favor. The point is, there are other things that can be done to make it more attractive to own off season.

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It honestly depends on how many units the HOA controls. If the HOA is developer controlled and they have been or start accepting deed backs from owners and can get there hands on 50.1 % of the total available inventory they can really do what they want since they have the super majority. If it was written in the original documents that they only need a regular majority (probably not the case) to make these types of changes they probably only need about 20% and can block vote since most owners don't bother to vote for anything.

If they are adding it as a "surcharge" rather than a difference in base MF's, they may be able to do it with a simple majority vote. If they go the surcharge route you would probably have to bring the fight to court and that can be an expensive prospect.

Also in SC, 2 developers started allowing their inhouse management companies to charge very large transfer fees most of which goes directly into the pockets of the management company and not into any resort improvements or amenities. Basically to discourage resales. Probably illegal but since none of the owners have the money to challenge the changes they are there.

If bought through the developer, a premium amount was paid for that prime week.

susgar said:

I haven't received a letter like this, but I think it is fair. We own a Mud week and bought the week before we really understood how Timesharing worked. The Mud week was bought from the developer, so yes oooch! So I do think those who were smarter than us at the time and bought prime weeks should pay more. They are able to enjoy the amenities offered during prime time that are not offered during our week. Also because we own an undesired week, we do not receive as many TPU's from RCI if we choose to trade. I try not to think about this often, because it reminds me I bought before I really understood the process.
Sue

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I think that, as stated previously, the "mud" week owners will think "it is fair." The prime week owners won't because the didn't get the lower buy-in price that the buyers of the "mud" weeks paid. I'm certain the salesman had red weeks available for sale. But a choice was made to buy the "mud" week instead.

Even buying resale, a prime summer week at the beach (same resort) is going to have a much higher cost than the February week at the beach.

vckempson said:

If the spread wasn't too terribly big, I wouldn't object to a tiered system. But for people who paid a big retail premium for red weeks, ( I bought resale), they have a right to be pretty upset at the thought of this.

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I am of this mindset.....if spread isn't too terribly big, then.....

It just doesn't make sense to own a blue week nowadays. You can rarely rent them and when you do, it's for less than the maintenance fee. I owned a developer-purchased blue week at the beach for 25 years. We got fabulous trades through RCI. Back then, you could also use your week if no one exchanged for it in RCI. Resales came along with great deals on prime weeks. Why own a blue week when you're going to have to pay the same maintenance fee as the prime week owner? That prime week owner can probably get double the maintenance fee in rent.

No, it's not fair. However, there's a pay-off (sorta) if you get that prime week at the prime resort for a fantastic price. It does happen with diligence and patience. Otherwise, you're paying a much higher price for your week.

I have made the choice to own prime weeks. The prime weeks owners are now taking on the fees of the non-paying owners.

Who wins? Who loses? Timeshare ownership is a gamble, among other things. I've been a very happy timeshare owner most of the last 30 years. I hope that will always be the case.

A solution is needed. Resorts are grasping at straws. I sure don't know what the answer is.

@tschwa2

Is a super majoirty only 50.1% or does it depend on the state and contract?

I own here and only received minutes from the last meeting in the mail. Somewhat concerning since I thought bad debt and HOA controlled units were not a major problem. The MF's are still low, it has been upgraded in RCI to a Gold Crown and is a good trader.

I guess in the end I'm paying the MF's for a mud week in arrears one way or another...

gnorth16 said:

@tschwa2

Is a super majoirty only 50.1% or does it depend on the state and contract?

I own here and only received minutes from the last meeting in the mail. Somewhat concerning since I thought bad debt and HOA controlled units were not a major problem. The MF's are still low, it has been upgraded in RCI to a Gold Crown and is a good trader.

I guess in the end I'm paying the MF's for a mud week in arrears one way or another...

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I'm pretty sure 50.1% is only a simple majority. I'd expect a super majority to be something like 60% or maybe even more. As to HOA's I don't know if it's state law that dictates or super majority or the bylaws. Hopefully someone will clarify.

While tiered MF's is a viable solution to those defaulting blue weeks, doing it after the fact can't be an easy feat to accomplish.

After doing a search for "super majority" on TUG, I happened upon an old thread about the mud week problem. Interestingly, it was mentioned that all states except Florida require all weeks owner to pay an equal amount. If that's true, I don't know how Pres Villas plans on doing this.

Anyway, I have no knowledge as to accuracy of this equal payment requirement, but here's the link to the prior thread

http://tugbbs.com/forums/showthread.php?t=154699&highlight=super+majority

This is how I see it unfolding.

"Reduce" all MF's by $200, but implement a tiered charge system based on amenities that are available in the summer, but not in the winter. Winter weeks don't get charged the "amenities fee" and their MF's are lower. The MF's for summer weeks are lower but they pay a $400 per week fee to use the lazy river.

I would think that an "amenities fee" is outside the CC&R guidelines. Technically, on paper, everyone pays the same MF's.

I'm not supportive of this idea as I don't think it will work. Is there a cut off for what people will pay in MF's in S.C in January? $200 off probably won't cut it!

I know CO and SC are two states that do not have to have MF the same for all weeks. I know MD they all have to be the same. Not sure about other states.

I thought the super majority came in that it was more than 50% or all owners not voting members but I just looked it up and what I was thinking was the absolute majority. The regular majority to get most things passed you only need 50% or even the majority of votes of the total needed for the quorum which is often around 20% of the owners. So if a resort has 1000 units and the quorum only required 20% than 200 voting units needed to respond. Of the 200 units 150 could say they had not preference but were only casting a vote to make up the quorum. 50 votes were cast. 26 voted in favor and 24 against. The measure would pass. It doesn't take many votes to get day to day things passed especially when the board is developer controlled and can vote as a block and/or greatly influence the regular owners by carefully worded postcards and voting sheets.

I would think that the CC&R would have to define the super majority. The super majority as defined in the CC&R would in theory be required for any major changes.

When I received my newsletter, it also had a form for me to sign if I couldn't make it to the March 21st meeting. I understand what a proxy is but I don't know where this person stands in regards to the way I would vote. I never signed a proxy, so do you also get some type of check list later as to where you want this person to vote, or are they just going the way the resort wants?

JPD said:

When I received my newsletter, it also had a form for me to sign if I couldn't make it to the March 21st meeting. I understand what a proxy is but I don't know where this person stands in regards to the way I would vote. I never signed a proxy, so do you also get some type of check list later as to where you want this person to vote, or are they just going the way the resort wants?

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Proxy votes always go the way of the organization. Think of it this way. The HOA will only offer up a proxy for the view they support. Someone else can mail all the owners and offer themselves up for proxy but they'd be mailing it out, not the HOA.

What are they proposing for an uptick in fees for summer owners? We own a few of those (three annual), and I just converted to RCI Points through the resort. I wouldn't be happy paying a lot more. I guess I better get my mail inside the house and look at the letter.

Letter didn't say, I did send an email to the listed email address, I asked them since the meeting is on March 21st, what would be the new fee schedule for prime weeks. They sent me a standard reply saying we welcome you to the meeting, if you need help with reservations let us know. I plan on attending that meeting, I only live 2 1/2 hrs. away.

JPD said:

Letter didn't say, I did send an email to the listed email address, I asked them since the meeting is on March 21st, what would be the new fee schedule for prime weeks. They sent me a standard reply saying we welcome you to the meeting, if you need help with reservations let us know. I plan on attending that meeting, I only live 2 1/2 hrs. away.

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I'll give you my proxy vote. I'll bet Cindy would too. Not sure of the procedure to do that, but I'm quite serious. I'd trust you as a current owner more than them to make an objective assessment to vote on my behalf.

The one thing I want to confirm is if it's still a developer controlled board. It has to be, I'd think, since they are still in active sales.

I can't make the meeting, but I would love to have more information.

I am of this mindset.....if spread isn't too terribly big, then.....

It just doesn't make sense to own a blue week nowadays. You can rarely rent them and when you do, it's for less than the maintenance fee.

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Yes - this is exactly the problem. It's the reason that modestly lowering the maintenance fee for mud week owners will NOT help reduce delinquent payments at all. Winter weeks at Pres. Villas and most Myrtle area timeshares rent for $300ish as RCI extra vacations even on the free sites like Endless Vacation rentals and the trading power on deposits is lousy at this time of year because demand is low. A modest reduction in fees is not going to change the fact that mud season owners are paying more maintenance than the value of their week for either direct use or trade. An extreme reduction in fees will backfire too, because ultimately the resort will run into prime season delinquencies if the maintenance fee spikes too high on the other end.

At the end of the day - the only solution that could work is one that creates a pseudo franchise style preference period system geared towards making ownership at the resort a legitimate benefit in itself (Marriott weeks in Hilton Head can be picked up with bonus certificates in the winter too, but because of Marriott preference benefits, those owners don't mind paying the fees). Obviously - a private resort can't create this benefit on such a large scale, but changing the policy so that all weeks can float year round within say 45 or 60 days would go a long way towards helping this problem. As a summer owner, I'd have absolutely no problem giving up my "exclusive right" to my choice of weeks during my usage period at 45 or 60 days out. I highly doubt that many prime season owners would mind this type of change. Certainly it would be viewed more favorably than a tiered spike in maintenance fees.

What you ask - would a change like this do for mud season owners? For starters, RCI still grants 80% of trading power within 31+ days of check in which would result in a whole lot more TPUs than a January deposit. When I bought my week at Presidential Villas last spring, the transaction didn't clear until late May or June. At that time when I called to make my 2013 reservation, there was still plenty of late July and August availability to choose from. My extended family ended up going to the resort in August and had a very nice time (my husband and I actually decided not to go last minute as we found out I was having twins and thought the drive would be too much - that's why I never submitted the review I promised to the TUG community...) However - we could have also chosen to deposit that week and would have still gotten a decent amount of trading power for it.

I would think an open last minute reservation period for all owners would benefit everyone in the long run.

Sandy VDH said:

....
I had a resort that just eliminated blue weeks and closed the resort during those months, what few blue owners they had were moved to white weeks. Now there is still insurance etc during blue weeks, but less overall costs for staff and maintenance.

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Sandy, what resort was it that closed in the blue season?

rickandcindy23 said:

....But some resorts are trying to change the bylaws and get rid of the tiered fees....

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Cindy, you are talking about resorts in Colorado, correct? Which resorts are trying to do this?

bonk2boy said:

Yes - this is exactly the problem. It's the reason that modestly lowering the maintenance fee for mud week owners will NOT help reduce delinquent payments at all...

... but changing the policy so that all weeks can float year round within say 45 or 60 days would go a long way towards helping this problem. As a summer owner, I'd have absolutely no problem giving up my "exclusive right" to my choice of weeks during my usage period at 45 or 60 days out. I highly doubt that many prime season owners would mind this type of change.

...What you ask - would a change like this do for mud season owners? For starters, RCI still grants 80% of trading power within 31+ days of check in which would result in a whole lot more TPUs than a January deposit.

...I would think an open last minute reservation period for all owners would benefit everyone in the long run.

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I didn't say that a slight spread in MF's would solve the problem, only that I wouldn't mind. Like you said, make the spread too big, and red week owner will revolt.

The idea of making all weeks available at 60 days out has some merit. I doubt it would work for long, though. First, the only reason there's plenty of weeks available on rather short notice is because of unsold developer inventory. Once that dries up, then red week owners will quickly learn to book further in advance to avoid loss of prime week, thus eliminating that short term summer inventory for the blue week owners.

In the end, as an owner there, I'm not sure how I feel about this. Do I give them kudos for attacking a problem before it get to be real bad or do I get upset at them solving a problem that's not terribly bad yet. I can't help but wonder if defaults are really the issue or is it the difficulty in selling blue weeks in their inventory that's the problem. In the long run they both affect me. In the short run, a sales issue only really affects them.

The idea of making all weeks available at 60 days out has some merit. I doubt it would work for long, though. First, the only reason there's plenty of weeks available on rather short notice is because of unsold developer inventory. Once that dries up, then red week owners will quickly learn to book further in advance to avoid loss of prime week, thus eliminating that short term summer inventory for the blue week owners

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I don't think unsold inventory is the reason for excess availability. My understanding (based on my family's visit) is that the resort isn't really pushing RCI weeks deeds anymore - they are almost exclusively selling new points deeds now and have been for quite some time. Points give the resort a ton of flexibility with deposits. They can deposit multiple white/blue/less desirable red weeks to RCI in order to combine for the allotted point total. The scenario you are describing really only becomes an issue for them if a higher percentage of points owners start staying at the resort rather than taking the points. Even if that happens, they always have a back up plan in that they can make it attractive enough to convince some of the prime season weeks owners to convert their weeks to points. Cindy - how much did that cost you guys? 104K points for the $700ish maintenance fee is a good deal if the conversion fee isn't too bad.

My point really goes back to the beginning of this string where posters were saying a tiered system will benefit everyone in the long run but addressing delinquency. It's impossible to address delinquency this way, because you would have to cut the blue week fee in half at the expense of the red weeks in order to make it worth the blue week owners while and a 50% increase to the red week owner maintenance would backfire severely on the resort IMO. A slight change in fee structure won't address this problem at all.











The other thing is - I doubt the resort will ever come close to completely selling out 100%. Few of these time shares do. Hasn't this resort been around a long time now? How many new sales do you really think they have in a year at this point. My guess is not that many.

I owned at Alpine Village near Burnsville NC and they closed the facility Dec though March. This kept MFs lower because minimal staff was needed to keep an eye on the bldgs during those winter months (like one person).

There is low occupancy during Nov as it is and in the winter it's impossible to get to the resort when snow falls.

I don't see how you could do this at a resort that currently has owners in the weeks they should be shut down but I'm sure some arrangement could be made.

Quote:
Originally Posted by rickandcindy23 View Post
....But some resorts are trying to change the bylaws and get rid of the tiered fees....
Cindy, you are talking about resorts in Colorado, correct? Which resorts are trying to do this?

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It's Pines at Meadowridge in Fraser, CO. It was set up as tiered 32 years ago, but the board is trying to change it. I believe ski week owners pay about $700 per week, blue week owners pay $220 per week or so, and summer weeks pay $480. These are two bedrooms, two baths and need a serious kitchen remodel, in my opinion.

I agree. creating a spread between red and blue weeks mf wont work to stop a flood of walk aways, neither will it make it easier to sell the blue weeks....why?

because the blue weeks are worthless, folks dont want them even if the price was a dollar, and mf was a dollar a year.

I own at a resort where they converted to RCI points to give the Blue weeks value. The problem is two fold, 1) the mf to points ratio is high and 2) they are charging the Blue weeks owners to convert and instead of giving the hoa controlled weeks away, they are trying to sell them

no one will cough up the money...it doesnt make sense.

It might work if the allowed free conversions, and gave the hoa owned weeks away.

It may not work even then.

It's Pines at Meadowridge in Fraser, CO. It was set up as tiered 32 years ago, but the board is trying to change it. I believe ski week owners pay about $700 per week, blue week owners pay $220 per week or so, and summer weeks pay $480.

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Wow - that's an insane spread. I think that if Pres. Villas lowered the blue weeks to the $220ish range at the expense of the red week owners, there would be a lawsuit from peak season owners and the resort would end up with an even bigger problem. Either that, or peak owners would stop paying fees which would create the same problem over again with different owners.
That would be almost a doubling in maintenance fees for peak owners.

However - the point is well taken as Ron pointed out. It would literally take a maintenance fee in this range to make it worth owning the blue weeks based on the current terms.

They have to come up with a different solution and opening up the float range last minute to fill vacancies during red season would be a very a good start with little downside risk. The worst that can happen is a blue owner calls up and can't get one of these last minute weeks they want in the 60 day window because there is no availability left. Sure - this would happen sometimes - but they are still no worse off than they were before, and at least there is hope of confirming a week that has some value for either deposit, rent or use.

Any reduction in Blue/White weeks will directly be an increase in Red weeks.

In RCI there are 4 Blue Weeks and 9 White Weeks. The rest are Red.

We need to see some numbers to see if this is doable BEFORE the meeting. I highly doubt I can make the meeting and am willing to proxy my vote to a TUG member.