But we aren't talking about financial models...at least I'm not.
Then you're not taking into account "the big picture"....which I'm sure DVD is. Everything they do fits into a financial model. Every penny of dues fits into their financial model. They don't make move one until they've projected, modeled, planned, and layed out every step they think they'll make over the course of the project. You know that. So, your assertion is they set the dues rate at it's current rate, knowing pretty well that based on their projections they would have to make a noticeable and marked jump, above the norm, in dues.
I give them more credit in the planning department than that. Largely because they've demonstrated they deserve it, historically.
The 2007 dues should be based upon the operating costs of the DVC portion of Jambo House. Period. DVC may have projections right now showing that it will cost $4.80 per point (or some other number) to operate Kidani Village. But they can't do anything about it. They aren't being dishonest by setting the dues where they are now, but they also can't over-charge Jambo House owners just to keep things on an even keel.
Exactly, they should be. Nobody has said otherwise. You contention is that's "not enough" to cover Kidani. I don't believe that to be true, and you've offered up nothing to convince me otherwise.
I'll grant you that you it's logical to think that such things would be taken into consideration when calculating dues, but that's not the case...at least not according to member accounting.
If a mixed-use resort's annual operating budget is set at $20 million and DVC has 40% of the "doors", members will pay $8 million in operating costs. Add in items unique to DVC like the Management Fee, Fees to the Division, etc., and divide by the number of points in the resort. There are your dues.
No consideration is given to room occupancy levels, housekeeping schedules square footage and other perceived variances.
So then DVC would be paying disproportionately large subsidy to AKL for amenities. Which goes to prove, actually, that it doesn't really stand to reason that any increase should be necessary, because they won't need to pay that "premium" at Kidani.
It is what it is.
I was told that Studios and 1Bs are counted as one "door" in terms of calculating cash / DVC resort expense ratios and lockoff 2Bs are two doors. I couldn't say with exact certainty how they count dedicated 2Bs and Grand villas.
DVC apparently chose a simplistic calculation rather than factoring in things like occupancy, square footage and other ancillary factors. For the most part it makes sense. For instance in terms of housekeeping, DVC rooms may get less frequent service, but the rooms are larger and require more labor to clean than a standard room.
It actually makes little sense from a finance standpoint. If what you're saying is true, you're right: It is what it is. But it leads to the DVC members paying a larger (disproportianately so) % of a resorts budget. Given that, it only bolsters my opinion that an increase looks unlikely, because Kidani won't inherit that "premium".
DVC may have flexibility in terms of setting the subsidy, but I would contend that any good faith effort would mandate erring in favor of the owners. If anything, they should be over estimating the subsidy--making owners pay less than their calculated share.
Under estimating the subsidy results in members paying a greater share of the operating costs than should be required. That's what we call fraud.
No one is over or underestimating the subsidy. I would think they're simply using it as is prudent to ensure members aren't left paying more than expected.
It's not fraud, actually. Not even close. Again, I can only speak from my own experience. Our developer subsidized maintenance on facilities meant to cater to a community not yet built. When the HOA was incepted, the dues level was set with support of all the facilities in mind. Early on, we paid most of the maintenance because there wasn't much to maintain, but there were relatively few of us, too. When facilities were brought on line, the developer subsidized their maintenance costs, beyond just the "dues" for the lots under development, because we were still a bit more than 1/2 "unbuilt". As our ranks grew, the subsidy shrank.
I would contend the above example is easily a gesture of "good faith".
You don't ask owners to pay excessive costs simply to "maintain equivalent ownership costs of the 2 buildings." The second building doesn't even exist yet--it is not part of the equation.
It's design and development is part of the equation...not directly effecting dues, but with an eye toward it's effect on dues, certainly.
You're not "asking" anyone to pay excessive costs. You simply plan things so that, just by function of the build out, they DO maintain equivalent ownership costs.
And yet the part that you discount, the front desk and lobby amenities, are at the core of this discussion.
I never claimed that room maintenance or housekeeping at Kidnai Village is going to drive up costs. The real issue is duplication of services, the costs of which will be shared by all owners to some degree.
And, again, what duplication? I discount them because I don't any real need for wholesale duplication. You still park as many cars. You still truck as many bags. You still check in as many people. Same number of resources, spread out at 2 different buildings. Please...explain why services are going to be so massively duplicated that it will have a noteable effect on the millions of points any minor "down staffing" issue would be spread across (like staffing 2 valets at both locations even when "dead", rather than 2 at one location). To date, you haven't.
SSR's main pool was in service from Day One.
All of the pools brought on-line since are scaled-down leisure pools. These secondary pools have no lifeguards to pay no slide to maintain. They are a fraction of the size of a feature pool.
To the tune of x2 (or 3?). AKV gets one.
In 2005 Old Key West added a pool slide and lifeguards to its main pool after operating without them for 14 years. When questioned about the budget impact, DVC indicated that adding these amenities raised member dues by about $.05 - .06 per point. That represented a non-inflationary increase in OKW dues of about 1.5%.
At a resort with no new units coming online who's dues had been fixed for years. They had no more points coming in...of course that meant a dues increase. It was an "unplanned" (at resort inception) expense. You're ignoring that AKV is new construction...with lots of new points coming on-line. Your supposition is that they haven't taken into account the new facilities, at all, when designing the new building and setting an initial dues rate. Again, why I don't find your argument compelling.
In 2007 and 2008, AKV owners will be paying no pool-related expenses. In 2009 they will all begin to share all of the costs related to maintenance and staffing of a lush pool and water play area. All we can do is put speculative numbers to these expenses...but we can't just disregard them. Spread over millions of AKV points, the total pool expenses could be something like $.10 or .12 per point. Not a cumbersome figure by any means.
They could be. Of course they could be .01 a point....and since you don't really have hard numbers, it' a bit misleading to even assign a "cost" to them. Your "model" (the OKW situation) isn't really equivalent since it's number of points was not also undergoing an expansion.
Share, across a MUCH larger pool of points....more than double the number of Jambo units, and thus points, being ADDED, without the premium associated with the mixed use model that you pointed out exists.
But, if members are paying NOTHING today, whatever the pool expenses might be will be an added cost. If it's $.12 per point, you'll see a one-time dues bump of about 2.5%. And I still contend that there will be other added expenses driven by the duplication of services and positions between the two facilities.
An added cost factored into the projection of revenue garnered from the units being brought on line at Kidani. Offset by the "premium" being paid at Jambo, the revenue coming in from the concierge lounge, etc, etc.
I'm not trying to stir the pot and allege there will be a 15% dues increase or any other exhorbitant figure. And whatever the increase might be, it clearly won't recur year-after-year. But nothing you've said has convinced me that DVC will be able to add these additional services / staff / facilities, and have the expense totally absorbed by the dues collected from new units constructed.
I'm not trying to convince you, remember? I'm telling you nothing you have said convinces me. That's where we started.
If the current Jambo house can pay for it's services, when complete, 100%, why can't Kidani? Your assertion just makes no sense.....if they can check in 150 people at Jambo, park 150 cars at Jambo, and bell 150 sets of bags...maintain a larger acreage of savannah...all on our current dues....why can't they do 350 at Kidani? It's not like you need to bus bags at BOTH places for the same party. It's not like you need to check in guests at BOTH places for the same party. I suppose you might have to valet some of the same cars if those at Kidani don't want to walk to Jambo, but...really....how much duplication do you think that's really going to cause.
At this point, we're just chasing our own tails. You've made some good points, and brought up some info I was unaware of (the "doors" method is mind bogglingly bad business), but still nothing that's convincing to me.
So, I propose we settle it thusly: I'll bet you the cost of a beer (or an actual beer if you're in our around WDW during one of our DVC trips) or other non-alcoholic beverage of your choice, that we don't see much in the way of a dues increase outside what goes on at the other resorts (typically 3 to 4%, but within a 1% range of whatever the typical increase is for that year) in '09 or 2010. And then we can let the rest of the thread off the hook for a discussion I'm sure many of them find boring, especially now we're both largely repeating ourselves.
Deal?
!
We figured with the amount of points we were adding on, we wouldn't get much of a benefit of buying at AKV, and at the end we'd have a small amount of points for 2 years. This way all our points end at the same time, and we paid less. Also, the dues for AKV are already higher than at SS. The price of caring for the animals will make the dues there higher. So not only did we save now, we save later. Now, if we were going to buy a lot of points, we'd have bought AKV to get the 11 month window. But for just a small amount, we went with what would save us money overall but still get us what we need. The guide totally wrote off OKW for us because of the difference in years, but that may be another option for you. They never did tell us the price for it though. 
This buying points thing is sure addictive.
