DVC Management Fee

[Sandisw]

Has anyone who talked to DVC management lately asked how the credit given back to owners impacted their fee?

Since it’s set as a straight percentage of the operating costs, and costs were down in 2020 in relation the the projected budget, I am wondering how that worked for them?

I have send an email but didn’t know if anyone here has actually discussed it with them.

 

[BWV Dreamin]

Has anyone who talked to DVC management lately asked how the credit given back to owners impacted their fee?

Since it’s set as a straight percentage of the operating costs, and costs were down in 2020 in relation the the projected budget, I am wondering how that worked for them?

I have send an email but didn’t know if anyone here has actually discussed it with them.

Very interesting. Let us know!!

 

[Sandisw]

Will do! Giving one more week for a response and emailing again.

 

[drusba]

Would be interesting to know if it was reduced in any way for 2020. Though one might surmise that some part of the fee should have been part of the credit for 2021 arising out of the lower costs from 2020, DVC could assert otherwise.

The fee is not actually 12% of the operating costs. It is defined to be 12% of the total annual “operating and reserve budget, exclusive of real estate taxes, transportation costs, and the management fee, itself.“ DVC could assert the amount of the fee thus depends solely on the total 2020 annual budget approved in Dec 2019 and does not vary based on actual costs incurred in 2020.

 

[Sandisw]

Would be interesting to know if it was reduced in any way for 2020. Though one might surmise that some part of the fee should have been part of the credit for 2021 arising out of the lower costs from 2020, DVC could assert otherwise.

The fee is not actually 12% of the operating costs. It is defined to be 12% of the total annual “operating and reserve budget, exclusive of real estate taxes, transportation costs, and the management fee, itself.“ DVC could assert the amount of the fee thus depends solely on the total 2020 annual budget approved in Dec 2019 and does not vary based on actual costs incurred in 2020.

Thanks for being more detailed. I will keep this updated with what information I get.

 

[jbh275]

Thanks

 

[Sandisw]

Slight update. I have gone back and forth a few emails. The first one simply discussed the operating credit owners received.

I responded saying that is not what I was asking and my next email was simply stating our fee is based on terms property management agreement and is 12%.

Since this is still not what I wanted, I asked the question again and said I’d like it sent to Teri.

The good news is they are answering relatively quickly!

 

[BWV Dreamin]

Thanks for your persistence!!!

 

[Sandisw]

Update. Finally got email confirmation that the fee paid to DVCMC in 2020 was not reduced because they continued to provide services via MS and Membership Accounting.

Now, with that, I will be working on sending them my thoughts about a few things as to why certain things continue to happen, even though they are working to correct it.

I know they get more income from things like breakage and selling rooms for cash from points they own. So, I am now curious if that played a roll in anyway. I also want a copy of the property management agreeement and working on requesting that.

 

[zavandor]

Update. Finally got email confirmation that the fee paid to DVCMC in 2020 was not reduced because they continued to provide services via MS and Membership Accounting.

So they should have not fired or furloughed anyone in MS even if the resorts were closed for months, is it correct? The current very long wait to talk with a CM should only be due to people calling more or asking more complex things, not because of reduced staff.

 

[Sandisw]

So they should have not fired or furloughed anyone in MS even if the resorts were closed for months, is it correct? The current very long wait to talk with a CM should only be due to people calling more or asking more complex things, not because of reduced staff.

That is a tough one because the CMs are employees of Disney and it was mentioned in one of the emails that the property management agreement plays some role,

That is why I can not say yes or no without that piece and the other regarding additional income Info.

For example, if their budget uses things like breakage and cash rooms to balance it...which would be lower during 3 months of closure...that impact the decision to furlough workers

Basically, if the only income is what we pay them...that 12%...then it seems there should not have been a reduction. However, if there are other areas of income that help pay salaries, etc. or something that gives Disney authority under the property management agreement which provides the workers, then it’s not that simple.

Which is why now that I have this info, I need the rest to frame my next set of questions,

 

[zavandor]

I thought that breakage is pure profit for Disney, but I may very well be wrong, so I'm interested in knowing what you discover! Thank you for asking Disney.

 

[Sandisw]

I thought that breakage is pure profit for Disney, but I may very well be wrong, so I'm interested in knowing what you discover! Thank you for asking Disney.

Exactly! I know DVCMC and BVTC get income from it but exactly for what is now the question.

 

[CarolynFH]

Exactly! I know DVCMC and BVTC get income from it but exactly for what is now the question.

Just wanted to say thank you for hanging on like a bulldog to get relevant answers!

 

[Sandisw]

Just wanted to say thank you for hanging on like a bulldog to get relevant answers!

LOL. I just think it’s important to get all relevant info before deciding how I feel about what is happening!

I am very pleased with what they are doing...and did...by using their own points to replace expired points for members. That had to impact their bottom line in some way. They didn’t need to do it.

But not so happy that it’s taken them this long to fix the wait times that have become unacceptable since January.

So, it will be an adventure to learn more!

 

[KAT4DISNEY]

The current very long wait to talk with a CM should only be due to people calling more or asking more complex things, not because of reduced staff.

The question I'm starting to have is how much it is supposed to cost us members to police the restrictions that DVD has placed upon certain memberships. Things like ticket offers that require members to call in to get screened if they qualify to purchase or not will be taking away time from other members. DVD doing this for their sales reasons is their choice but I think they are placing too much of that verification upon member services CM's and that ends up ultimately being paid for by all owners and not DVD who created the necessity.

 

[zavandor]

The question I'm starting to have is how much it is supposed to cost us members to police the restrictions that DVD has placed upon certain memberships. Things like ticket offers that require members to call in to get screened if they qualify to purchase or not will be taking away time from other members. DVD doing this for their sales reasons is their choice but I think they are placing too much of that verification upon member services CM's and that ends up ultimately being paid for by all owners and not DVD who created the necessity.

That's a very excellent point. We could even say that we really shouldn't pay for CM dealing with perks at all, since they should be paid in full by DVC. FOr example, time spent by a CM to book a members cruise, should be paid by DVD, not with the DVCMC budget.
But it's one of those things that they can easily get away with. Like when they added the $6 fee to deliver groceries in room. It used to be included in the fees we paid and then it became a paid extra service. When I asked an explanation, they said it used to be provided for free by the resorts, not paid by the members. Which doesn't make any sense, but to prove the contrary is difficult.

 

[Sandisw]

That's a very excellent point. We could even say that we really shouldn't pay for CM dealing with perks at all, since they should be paid in full by DVC. FOr example, time spent by a CM to book a members cruise, should be paid by DVD, not with the DVCMC budget.
But it's one of those things that they can easily get away with. Like when they added the $6 fee to deliver groceries in room. It used to be included in the fees we paid and then it became a paid extra service. When I asked an explanation, they said it used to be provided for free by the resorts, not paid by the members. Which doesn't make any sense, but prove the contrary is difficult.

The bell services fee though was applied to everyone, which includes cash guests. I don’t see that as something we get to do differently

But, the cost of CMs helping with membership perks is an interesting one. Not sure that I agree but it is something I had not though of! Think that is a little too bit of trying to micromanage but it give me another question to ask.

Does DVD provide any financial support to the overall budget of DVCMC.

 

[zavandor]

I have written to DVC asking for the creation of a separate phone line that would deal with all matters regarding perks not available to all members, with staff paid by DVD.

 

[Sandisw]

I did get my copies today of the property management agreements for my three home resorts

I will read them over and see what info they have that might be interesting!