Third party commercial renters

[Sandisw]

Imposing limits on members making rental reservations by using their points to make reservations requested by the renter is almost impossible to enforce. Even if someone makes 25 reservations in a year in the name of others, and Disney flags them, they can say I don’t get to go much these days, and all of those reservations are for friends of mine, because I’m a nice guy. And in these days of people having hundreds of Facebook friends and thousands of Instagram followers, where you can be friends with people you never meet in real life, it is extremely difficult for Disney to prove that someone is not your “friend”. And Disney is not the IRS; lying to Disney is not a crime, and they have no power to examine your bank or Venmo accounts. Disney could try a “sting operation” where they have employees pretend to be vacationers requesting rentals on places like DVC Rental Store, David’s, or DIS, and this would give them the member information of anyone who responded. But the problem there is that renting points is explicitly permitted, and it is highly unlikely that any member would respond to a large enough number of these “sting operation” requests to prove that they were engaged in “commercial” renting. So this would be a huge amount of work and expense resulting in very little (and quite possibly zero) payoff.

The lowest-hanging fruit here is spec rentals advertised publicly on the internet, which are unambiguously rentals as opposed to reservations for “friends”. Disney could monitor these listings and use their database of room reservations and knowledge of guest name change requests to see which accounts are listing these rentals and getting paid for them. And if they find a membership account dominated by this kind of activity, then that’s a clear case of violating the “commercial use” clause and they can take action.

There is something that I read yesterday that seems to me to support they can not stop me from spec renting. Renting a reservation is renting a reservation and we don’t need approval do put one in a renters name.


Having said that, they certainly could say that owners are only allowed to advertise find owners using the newspaper, or thst you can only rent to family and friends and not strangers. I doubt most owners would find that reasonable and one would have to fight it with a complaint…but if they want to be unreasonable they can.

Per the terms of the contract an individual rental, on its own, can not be used as a criteria to say you have violated the commercial use clause and DVC knows that.

Again, it using your membership as a business that is at issue and not allowed.

I just don’t see how one goes about finding a renter or whether they book it and then rent or book it after they have an owner matters for the purpose of a membership as a business. I think that is why the updated language of RIV and beyond added the words “pattern of rental” and “regular use of a rental site””to establish its repeated behavior of having rentals that will get you in potential trouble.

If I rent only one reservation a year and that’s it, and it was a spec rental, then it’s going to be hard for DVC to say my membership is a business if all the other ones are for me.

TBH, I don’t even think DVC wants that to be the criteria because it would be virtually impossible to enforce.

 

[mistysue]

Imposing limits on members making rental reservations by using their points to make reservations requested by the renter is almost impossible to enforce. Even if someone makes 25 reservations in a year in the name of others, and Disney flags them, they can say I don’t get to go much these days, and all of those reservations are for friends of mine, because I’m a nice guy. And in these days of people having hundreds of Facebook friends and thousands of Instagram followers, where you can be friends with people you never meet in real life, it is extremely difficult for Disney to prove that someone is not your “friend”. And Disney is not the IRS; lying to Disney is not a crime, and they have no power to examine your bank or Venmo accounts. Disney could try a “sting operation” where they have employees pretend to be vacationers requesting rentals on places like DVC Rental Store, David’s, or DIS, and this would give them the member information of anyone who responded. But the problem there is that renting points is explicitly permitted, and it is highly unlikely that any member would respond to a large enough number of these “sting operation” requests to prove that they were engaged in “commercial” renting. So this would be a huge amount of work and expense resulting in very little (and quite possibly zero) payoff.

The lowest-hanging fruit here is spec rentals advertised publicly on the internet, which are unambiguously rentals as opposed to reservations for “friends”. Disney could monitor these listings and use their database of room reservations and knowledge of guest name change requests to see which accounts are listing these rentals and getting paid for them. And if they find a membership account dominated by this kind of activity, then that’s a clear case of violating the “commercial use” clause and they can take action.

Yes - and I think this is what most would really want them to clean up. There's no reason why Disney couldn't keep notes year by year to notice the guy who has 25 random friends one year has 25 new friends the next, etc. There's always going to be squabbling over "hey- how come you rented that one great room" from some, but what needs to actually be addressed is people buying points to make an industry out of it. It's clearly a violation of what this entire system is intended to be, whether or not Disney has vaguely written little loopholes. I don't think it's even a stretch to speculate there may be something changing hands to "help someone ignore or not notice" some of these memberships as at this point it's so blatant that there's abuse happening on some level.

 

[GoingSince1990]

There is something that I read yesterday that seems to me to support they can not stop me from spec renting. Renting a reservation is renting a reservation and we don’t need approval do put one in a renters name.


Having said that, they certainly could say that owners are only allowed to advertise find owners using the newspaper, or thst you can only rent to family and friends and not strangers. I doubt most owners would find that reasonable and one would have to fight it with a complaint…but if they want to be unreasonable they can.

Per the terms of the contract an individual rental, on its own, can not be used as a criteria to say you have violated the commercial use clause and DVC knows that.

Again, it using your membership as a business that is at issue and not allowed.

I just don’t see how one goes about finding a renter or whether they book it and then rent or book it after they have an owner matters for the purpose of a membership as a business. I think that is why the updated language of RIV and beyond added the words “pattern of rental” and “regular use of a rental site””to establish its repeated behavior of having rentals that will get you in potential trouble.

If I rent only one reservation a year and that’s it, and it was a spec rental, then it’s going to be hard for DVC to say my membership is a business if all the other ones are for me.

TBH, I don’t even think DVC wants that to be the criteria because it would be virtually impossible to enforce.

No, I agree that they can't stop you from spec renting, provided that you don't violate the "commercial" renting clause. After all, how can anyone prove that it was a "spec rental" as opposed to a trip you planned to take, but then were unable to go on for some reason, so rented the reservation instead? The point I was trying to make was that if Disney decides to clamp down on violations of the commercial renting clause, it is much easier for them to focus on pages and pages of reservations offered for rent on the internet than on owners going the DVC Rental Store/David's route of making reservations in response to requests for rentals. And based on the posts in this thread, it's the pages of reservations offered for rentals of what are seen as highly desirable rooms at highly desirable times that some people get most infuriated by.

 

[BeachClub2014]

@Sandisw, is there then is there a different 12% pool of money that you and @Chuck S are referencing when telling @DonMacGregor that increasing dues wasn't an option for better enforcement of the rules? (my summation of his point)

Except...we really can't. DVC Management is limited to 12% of dues. Special assements are limited in what they can be used for, and "dues" outside the 12% to Disney managment is limited to actual care serviices,(Transporation, lawn care, normal maintenance), utilities, parking/road upkeep, and common area maintenance of your home resort only.

It would be interesting to see how many owners would vote to increase the % paid to DVC to manage the program to offset this.

What would be more interesting, since each condo association would have to vote for their own resort, is whether some resort owners would vote yes and other resort owners said no.

The point is, DVC Management can ONLY get money from the 12% it is entitled to.

Especially since DVC Management doesn't see it as a large problem for the vast majority of members, they will not authorize the expense of sending out ballots to each and every member, then tabulating them which also would need to be taken from their 12%.

 

[Sandisw]

No, I agree that they can't stop you from spec renting, provided that you don't violate the "commercial" renting clause. After all, how can anyone prove that it was a "spec rental" as opposed to a trip you planned to take, but then were unable to go on for some reason, so rented the reservation instead? The point I was trying to make was that if Disney decides to clamp down on violations of the commercial renting clause, it is much easier for them to focus on pages and pages of reservations offered for rent on the internet than on owners going the DVC Rental Store/David's route of making reservations in response to requests for rentals. And based on the posts in this thread, it's the pages of reservations offered for rentals of what are seen as highly desirable rooms at highly desirable times that some people get most infuriated by.

These are the clauses from the RIV contract that define use of the membership. There is no use of the word "commercial rental" because we are allowed to rent...and I don't mean to sound nitpicky...sorry in advance to anyone I am offending...but its turning the membership into a commercial enterprise that is an issue....that is why a spec rental and a rental made on demand can not be seen as two different things when it comes to enforcing the rules of the contract...






ETA: That is not to say there are not owners or businesses out there that have a lot of rentals, spec ones included, booked on their membership that many would see, and DVC should see, as a "commercial enterprise"....

 

[mistysue]

@Sandisw, is there then is there a different 12% pool of money that you and @Chuck S are referencing when telling @DonMacGregor that increasing dues wasn't an option for better enforcement of the rules? (my summation of his point)

I'm still wondering where all the money went from doing phone confirmations for what used to be every single reservation, and why it's unreasonable to think they could look into a random sampling, when that funding seems to have gotten pocketed in the transaction. They used to talk to every single customer. But now looking up 1 out of 20 is a huge waste? Sometimes in business you make a cut to save money and it doesn't work so you have to go back.

 

[Sandisw]

@Sandisw, is there then is there a different 12% pool of money that you and @Chuck S are referencing when telling @DonMacGregor that increasing dues wasn't an option for better enforcement of the rules? (my summation of his point)

Let me first correct one piece from yesterday...the property management agreement, which is with DVCMC and the hotel division to manage and run the resorts, also includes the contract with DVCMC...sorry for that mistake.

Here is the clause that states we, as owners, will pay DVCMC 12% to manage the program. My understanding is owners would be required to vote to increase it and then if approved by owners, it goes to the board for approval.

 

[Sandisw]

I'm still wondering where all the money went from doing phone confirmations for what used to be every single reservation, and why it's unreasonable to think they could look into a random sampling, when that funding seems to have gotten pocketed in the transaction. They used to talk to every single customer. But now looking up 1 out of 20 is a huge waste? Sometimes in business you make a cut to save money and it doesn't work so you have to go back.

Because the fee is a straight 12%, DVCMC doesn't have to account for what it does with the money. We are not entitled to see their books because we simply hire them, as owners. to oversee things. They have a resonsiblity to manage the program efficiently and to the benefit of owners, but beyond that? They can choose how to spend that fee. Of course, owners have the right to complain to DVC that they have concerns on what they are doing, which is why there is a membership satisfaction team....and I think overall, DVC does a good job in running the program. Are there issues? Sure (like a glitchy website).....

So, when online booking was implemented, any savings from that move belonged to DVCMC.

 

[GoingSince1990]

I'm still wondering where all the money went from doing phone confirmations for what used to be every single reservation, and why it's unreasonable to think they could look into a random sampling, when that funding seems to have gotten pocketed in the transaction. They used to talk to every single customer. But now looking up 1 out of 20 is a huge waste? Sometimes in business you make a cut to save money and it doesn't work so you have to go back.

It's not like one day they switched to online reservations and suddenly got an enormous windfall, saving a fortune by firing hundreds of phone agents. Changes like this are a massive and costly investment in IT infrastructure, which takes many years to pay for itself in savings.

 

[mistysue]

Because the fee is a straight 12%, DVCMC doesn't have to account for what it does with the money. We are not entitled to see their books because we simply hire them, as owners. to oversee things. They have a resonsiblity to manage them property efficiently and to the benefit of owners, but beyond that? They can choose how to spend that fee.

So, when they cut down the number of CM's because of online booking, they could take the money and use it for other things, or turn it into profit.

I'm aware of all of that, which is why I wonder what they did - knowing there is no obligation for them to tell me anyway. But it's a good thought as far as I'm concerned because it makes it less unreasonable to say they need to get someone in there looking into the rental issue.

 

[mistysue]

It's not like one day they switched to online reservations and suddenly got an enormous windfall, saving a fortune by firing hundreds of phone agents. Changes like this are a massive and costly investment in IT infrastructure, which takes many years to pay for itself in savings.

But it's not like this was a new hotel chain. They would have had underlying infrastructure from Disney in general running their hotel reservations this way. And even if we pretend it was a completely unique company starting from scratch, within a few years there would be savings there.

 

[GoingSince1990]

But it's not like this was a new hotel chain. They would have had underlying infrastructure from Disney in general running their hotel reservations this way. And even if we pretend it was a completely unique company starting from scratch, within a few years there would be savings there.

The hotel reservations system is so different from the DVC system that it would almost certainly have been easier to start from scratch, which is what I suspect they did for the DVC reservations platform. And there's no going back now; a huge amount of money has been spent on the online platform and they are not going to write that off and hire hundreds of new people for phone support.

 

[mistysue]

The hotel reservations system is so different from the DVC system that it would almost certainly have been easier to start from scratch, which is what I suspect they did for the DVC reservations platform. And there's no going back now; a huge amount of money has been spent on the online platform and they are not going to write that off and hire hundreds of new people for phone support.

Also not what I'm saying. I'm saying if they for example, laid off 200 people, they could probably bring in 2-4 people to audit accounts for signs of it being a commercial account.

 

[BeachClub2014]

Let me first correct one piece from yesterday...the property management agreement, which is with DVCMC and the hotel division to manage and run the resorts, also includes the contract with DVCMC...sorry for that mistake.

Here is the clause that states we, as owners, will pay DVCMC 12% to manage the program. My understanding is owners would be required to vote to increase it and then if approved by owners, it goes to the board for approval.

View attachment 868548

Thanks for the correction. These contracts can be a challenge to untangle.

So, if I am now hearing you correctly, @DonMacGregor's idea of up charging dues to fund enhanced rule enforcement doesn't fall within this 12%. If that is the case, then rule enforcement falls under our regular dues and, therefore, doesn't require any action of the owners to change. It's either one or the other, right?

I just want to make sure that I understand the point that you and @Chuck S have made.

 

[Sandisw]

Also not what I'm saying. I'm saying if they for example, laid off 200 people, they could probably bring in 2-4 people to audit accounts for signs of it being a commercial account.

Ask DVC if they are monitoring people,s membership to make sure they are not being used as a commercial entity snd the answer is “yes, we do that”. If you ask how, it’s “ we take this seriously and flag accounts that might be in violation.

So, according the CMs who have answered emails, they do monitor and enforce…..

If that is the answer this time, then I will push to have them send me the document that defines it and what the consequence is. Like I said ealrier, words like pattern of rental activity are do broad…I want to know what that pattern looks like…is it the same as before, or is it different now,

 

[Chuck S]

So the question really is, where does Member Administration/Member Service fall in the budget...

Under Administration and Front Desk (seems strange to lump those together), under DVC Reservation Component-Buena Vista Trading Company, or Under the Management Agreement, since the reservations also tie in with MDE and Disney as a whole, eventually?

Since it ties in with MDE and Disney's resort reservation system,. even though not directly, and the reservaton number have to be linked, I'm still thinking maybe under the Management agreement. With BVTC handling external RCI trades, but it would be good to find the answer.

Remember, Disney does have a direct interest (sales) and a feduciary responsibility responsibility to member to keep dues as low as the can, which is why the budget seems pretty detailed, except where everything actually fits in the numbers.

 

[Sandisw]

Thanks for the correction. These contracts can be a challenge to untangle.

So, if I am now hearing you correctly, @DonMacGregor's idea of up charging dues to fund enhanced rule enforcement doesn't fall within this 12%. If that is the case, then rule enforcement falls under our regular dues and, therefore, doesn't require any action of the owners to change. It's either one or the other, right?

I just want to make sure that I understand the point that you and @Chuck S have made.

It is DVCs responsibility to run the program which includes making sure owners are not violating the rules of the contract

So, the cost to do that comes out of the 12% fee they get as part of our dues.

Owners can not be charged more for their services unless theyvoted to increased that 12% to a higher number and then if it is approved by owners, the board has to approve it as well. Those votes would be at the individual resort level. Theoretically, AKv owners could opt to pay more and SSR owners say no.

So, there is no way for owners to be charged more to pay for services not happening today. Members who are unsatisfied with what DVC is doing need to complain.

For example, checking every membership for every reservation. If that would take an extra 10 CMs to do and follow through to owners, then DVC has to reduce CMS elsewhere in order to accomplish that or take less profit. Guess which one is likely

 

[Sandisw]

So the question really is, where does Member Administration/Member Service fall in the budget...

Under Administration and Front Desk (seems strange to lump those together), under DVC Reservation Component-Buena Vista Trading Company, or Under the Management Agreement, since the reservations also tie in with MDE and Disney as a whole, eventually?

Since it ties in with MDE and Disney's resort reservation system,. even though not directly, and the reservaton number have to be linked, I'm still thinking maybe under the Management agreement. With BVTC handling external RCI trades, but it would be good to find the answer.

Remember, Disney does have a direct interest (sales) and a feduciary responsibility responsibility to member to keep dues as low as the can, which is why the budget seems pretty detailed, except where everything actually fits in the numbers.

Administration and front desk line items on the budget relate to the actual running of the resort. Thst is paid to the hotel division.

The management fee line item is the DVC fee of 12% and what is used to pay MS, MA, accounting and BVTC, along with DVC managers, etc.

The DVC reservation line item applies to BVTC…and is what they get in addition to what they get that is built into the 12% management fee.

 

[BeachClub2014]

It is DVCs responsibility to run the program which includes making sure owners are not violating the rules of the contract

So, the cost to do that comes out of the 12% fee they get as part of our dues.

Owners can not be charged more for their services unless theyvoted to increased that 12% to a higher number and then if it is approved by owners, the board has to approve it as well. Those votes would be at the individual resort level. Theoretically, AKv owners could opt to pay more and SSR owners say no.

So, there is no way for owners to be charged more to pay for services not happening today. Members who are unsatisfied with what DVC is doing need to complain.

For example, checking every membership for every reservation. If that would take an extra 10 CMs to do and follow through to owners, then DVC has to reduce CMS elsewhere in order to accomplish that or take less profit. Guess which one is likely

Okay, I am tracking. We agree that enforcing rules is part of running the program. My point is that the enforcement of the rules is already in the 12% so there is no need for an increase. Just do the job they are already being paid to do.

 

[Chuck S]

Okay, I am tracking. We agree that enforcing rules is part of running the program. My point is that the enforcement of the rules is already in the 12% so there is no need for an increase. Just do the job they are already being paid to do.

And again, pull CMs away the call in phone lines, membership processing (admin) from other duties to do that? Or would you rather they shut the reservation and phone lines down on Sunday, like when DVC first opened, to give them time to do that?

There actually is NO EVIDENCE that they are NOT enforcing it within the DVC Guideline based on the number of reservations to throw a member into review. And considering that even a website that would have 1,000 reservations listed, that is about 3 per week, not enough to have any major impact on availability considering the number of DVC Rooms system wide.