Boardwalk Villas

[antnee]

Okay I just go this bulletin from the DVC Management Corp andI reviewed som of the expenses. I have some questions. Why is the OE for Housekeeping over 2.8 million dollars when we dont get traditional housekeeping. I think that seems a bit high. Also why 1.4 million for Mgmt expenses. There are 367 vacation homes and Maintennence is 2.5 million without Utils. but our Dues are estimated at over 12 million. I am no expert at analyzing these numbers.But maybe someonecould explain it to me. How come maint. expenses arent Itemized? How come most expenses arent itemized? Are there any write-offs on the DVC that we get back to go into the budget next year? If these are estimates for 2002, what happens to the left over money?


Anyone?

 

[DVC~OKW~96]

Wow! Good questions! Where's Rich?

 

[drusba]

Some explanations:

1. Though there is limited housekeeping, they still clean all rooms on a regular basis, take care of cleaning the hallways, elevators and other common areas, buy and clean towels, sheets, blankets, and pillows, supply soap, shampoo, detergent, paper towels and other such items, replace kitchen items, and do other things to keep the place in top shape. They are required to base the budget for such things on actual projected costs (not cost plus profit) and thus if you assume they are complying with the laws applicable they are not overcharging. $2.8 million is actually not a huge amount for housekeeping at a Disney resort the size of BWV.

2. The management fee is actually a percentage cut in stone. If you review your disclosure documents you will see that that the management company, Disney Vacation Club Management Company (one of DVD's related companies), is to get 12% of the total budget per year (not including property taxes) to manage the resort. The percentage is fixed and cannot be changed but of course as the total budget rises so does the total amount.

3. Maintenance costs cover everthing for the day to day maintenance of the resort that Housekeeping does not--painting, repairs, groundskeeping, pools, replacement of appliances, outdoor chairs, boardwalk maintenance, etc. Again I do not perceive the amount to be huge for a Disney resort of this size.

3. Various costs are not itemized because Timeshare laws do not require them to provide an itemized budget. Note you do have a right to review actual accounting records maintained for the association upon giving reasonable written notice and of course you would have to go to their offices to review any such records.

4. If they collect more than they actually spend for the year, the excess goes into the capital reserves for the resort's long term maintenance (see the capital reserve budget of your dues for maintenance covered by capital reserves).