2013 Dues Analysis

[wdrl]

I've done that calculation for the resorts that I own (SSR, AKV, BLT & VWL). Using the information in the budget, I calculate the number of points at each resort along with the number of points in each vacation home (2BR equivalent). I've calculated the annual cost of housekeeping per vacation home in 2013 as follows:
SSR - $11,668
AKV - $13,219
BLT - $17,344 (was $13,328 in 2012)
VWL - $12,150

The BLT number does stand out as high when compared to the others.

How did you adjust for the view category differences at AKV and BLT? Also, how did you apportion housekeeping charges between the two-bedroom vacation homes and the Grand Villas?

 

[Rob S.]

How did you adjust for the view category differences at AKV and BLT? Also, how did you apportion housekeeping charges between the two-bedroom vacation homes and the Grand Villas?

These are just averages. Looking at BLT, the total housekeping budget is $4.9M and there are 281 "Vacation Homes". Just doing the simple math indicates that the AVERAGE annual cost for each vacation home is $17,344. The view category would have no impact. I'm not sure how the Grand Villas would have an impact but I don't think it would be material as those are a small percentage of the total.

 

[KingRichard]

I've done that calculation for the resorts that I own (SSR, AKV, BLT & VWL). Using the information in the budget, I calculate the number of points at each resort along with the number of points in each vacation home (2BR equivalent). I've calculated the annual cost of housekeeping per vacation home in 2013 as follows:
SSR - $11,668
AKV - $13,219
BLT - $17,344 (was $13,328 in 2012)
VWL - $12,150

The BLT number does stand out as high when compared to the others.

50% more seems like a big difference!

 

[JWG]

50% more seems like a big difference!

Due to high point values, are people staying (on average) fewer days at BLT requiring more frequent full cleanings and thus driving up the costs?

As a point of reference, Disney will tell you that a 2BR takes 2 hours to clean (fully clean). Meaning, a Mousekeeper could only clean 4 rooms a day if all 2 BRs.

I agree the difference is ridiculously high. My recommendation, ask about it tomorrow at the condo meeting.

 

[aggiemullins]

I'm curious if anyone grilled Claire in the meeting last week on the housekeeping issue? I know from Tim's twitter feed he said they did say they had large increases in housekeeping pay and benefits, but 25% is ridiculous. I hope somebody called them out on it.

 

[zavandor]

We can only hope that this increase is due also to a better service in the future. Members complain form time to time about housekeeping issues. Maybe we'll see an improvement.

 

[tjkraz]

I'm curious if anyone grilled Claire in the meeting last week on the housekeeping issue? I know from Tim's twitter feed he said they did say they had large increases in housekeeping pay and benefits, but 25% is ridiculous. I hope somebody called them out on it.

There was no line of questioning directed solely at the housekeeping cost.

Someone did bring up the impact of higher employer costs driven by "Obamacare" (which is gradually rolling out through 2014) and the DVC reps said Disney is already working to comply with the current laws. So that's likely part of it.

The new bed sheets are going to be more costly. More items to be laundered...more labor to handle the materials...more frequent replacement cost.

Disney reached new labor agreements with several unions a couple years ago and I'm sure pay & benefit increases of some sort were included. DVC cited a figure of wage & benefit costs rising as much as 20% for some Florida-based employees.

This didn't come up in the meeting but I also wonder what impact the so-called "fiscal cliff" had on the budget. As I understand it, payroll taxes are set to rise 2% for the first $113K in wages for all workers on January 1st. That tax is part of our dues and I assume DVC would have to take the possibility into account when calculating. Dues may be impacted in other ways if a deal isn't reached by 12/31.

Fortunately if these tax rates are eventually rolled back, any dues excess would go into the reserves. The 2014 budgets would benefit from the lower tax basis.

 

[dizfan]

As I understand it, payroll taxes are set to rise 2% for the first $113K in wages for all workers on January 1st. That tax is part of our dues and I assume DVC would have to take the possibility into account when calculating.

I believe the payroll tax holiday passed in 2010, was a 2% cut on the worker portion and not the employer portion toward Social Security. If it expires, it should not have any impact on dues unless it was part of the union contract.

However, it will make for some upset employees to see 2% less in take home pay.

 

[CRobin]

I believe the payroll tax holiday passed in 2010, was a 2% cut on the worker portion and not the employer portion toward Social Security. If it expires, it should not have any impact on dues unless it was part of the union contract.

However, it will make for some upset employees to see 2% less in take home pay.

That is correct. The soon expiring "payroll" tax cut impacted employees only, not employers.

Sent from my iPad using DISBoards

 

[sweetdana]

BLT washes blankets every turn on the room, most do not wash conforters every night. Certainly an extra loan of laundry/labor would add something along with the extra bathroom.

I also have a thought.. lots of people just try BLT, and if it is only for a night or 2 this would bring up the average. If someone stayed 11 nights in OKW, they would have 1 full cleaning and 2 1/2 cleaning. .. in BLT it may be 4 sets of people trying 1-2 nights and a 5 nighter. I bet the average "nights" pp is much lower at BLT. I know about 4 people who put 1 or 2 days there to try it before going to there home resort. .. and 1 person who popped by for a night on there way to a beach resort. Saying I am staying only 1 night.. maybe BLT. ..

I dont know this is the reason for AKV.. but I think it is a good bet on BLT.

The newness is wearing off too.. so that may slowly wash out and next yr go down a little. If it keeps up, it is plausible to put a 3 day min on non blt owners, or resale purchasers, or something to assist and brining it back for the owners... as if this is why, it is not really fair to the actual owners paying the dues.

 

[Greysword]

BLT washes blankets every turn on the room, most do not wash conforters every night. Certainly an extra loan of laundry/labor would add something along with the extra bathroom.

I also have a thought.. lots of people just try BLT, and if it is only for a night or 2 this would bring up the average. If someone stayed 11 nights in OKW, they would have 1 full cleaning and 2 1/2 cleaning. .. in BLT it may be 4 sets of people trying 1-2 nights and a 5 nighter. I bet the average "nights" pp is much lower at BLT. I know about 4 people who put 1 or 2 days there to try it before going to there home resort. .. and 1 person who popped by for a night on there way to a beach resort. Saying I am staying only 1 night.. maybe BLT. ..

I dont know this is the reason for AKV.. but I think it is a good bet on BLT.

The newness is wearing off too.. so that may slowly wash out and next yr go down a little. If it keeps up, it is plausible to put a 3 day min on non BLT owners, or resale purchasers, or something to assist and bringing it back for the owners... as if this is why, it is not really fair to the actual owners paying the dues.

Good points, Dana. As for the thought of a minimum stay, I doubt that will happen for several reasons, one of which is owners at other resorts noting that BLT is on the lower end of the dues spectrum in total; "your dues are lower overall so you should just be happy" sort of thing.

Another reason being it would set a precedent not currently in place and would change the dynamic of BLT's position in the Club.

Great analysis, though.