Why does DVC pass off the cost of transportation to the parks to members?

[Yankee626]

This post is really in response to Disney not offering park discounts to its members ( blue card or not ) . I know they are resuming AP sales and Members are able to buy the Florida Resident passes (sorcerers pass) , but that's really not a discount. I keep hearing that we have bought an interest in a hotel room and that's it. If that's the case why are we paying for transportation to a park that we have to pay the same rates as everyone else to use. It seems like that should be a parks expense . The monorail; Skyliner and buses are all extensions of the parks are they not ? Seems like a slick accounting gimmick to pass off a cost to Members when only ticket holders will use them . Not necessarily owners.

 

[DizneyFamof4]

Would you offer discounts to customers that have already gave you $$$ and are alrady commited to paying yearly fees for the next 20+ years? I wouldn't. They are still selling DVC's at a good rate and are building more units, without offering discounts. In business you offer discounts to draw customers, but when you already have a solid base there is no need.

 

[supersnoop]

This post is really in response to Disney not offering park discounts to its members ( blue card or not ) . I know they are resuming AP sales and Members are able to buy the Florida Resident passes (sorcerers pass) , but that's really not a discount. I keep hearing that we have bought an interest in a hotel room and that's it. If that's the case why are we paying for transportation to a park that we have to pay the same rates as everyone else to use. It seems like that should be a parks expense . The monorail; Skyliner and buses are all extensions of the parks are they not ? Seems like a slick accounting gimmick to pass off a cost to Members when only ticket holders will use them . Not necessarily owners.

The question you have to ask is; is transportation a function of the resort, or a function of the park? There's where any creative accounting comes in. I imagine it's a little bit of both.

As owners of the property, we're responsible for paying for maintenance and operation of the resort (or, where the resort and a hotel operate together, we're responsible for a portion of that expense). For example, at AKV, only a small portion of the animal upkeep is attributed to the resort, with most being borne by the park and the conservation organization. If transportation is a function of the resort, then we are responsible for paying that expense. We don't really get to look into all of the accounting, but I have to imagine the actual cost is split between parks and resorts; between the actual buses, the employees, the gas, and the bus stops on each property.

Lots of people without park tickets use the transportation; either to Disney Springs or to get to other resorts for meals.

 

[CarolynFH]

All WDW resorts contribute to the cost of operating transportation that serves that resort. For instance, BW Resort (Inn and Villas) contributes to operating the buses to MK and AK and the Friendship boats to Epcot and DHS, but it doesn't contribute to operating the Skyliner or the monorail. The Grand Floridian Resort and the Villas of the Grand Floridian pay for buses to AK and DHS and for the monorail to MK and Epcot but not for the Skyliner or the Friendship boats. Riviera pays for Skyliner and for buses.

Some of the money that cash guests pay for their rooms goes to cover that resort's contribution, just like part of our dues goes to cover it. The Parks division probably covers part of the expense as well, but we pay because it's part of the expenses of operating our resort.

 

[Sandisw]

The way that the POS was set up was to include the ability of things like transportation to and from the parks to be part of the expenses of the condo association

We get access to all the onsite perks as well as part of our contracts. My guess is that in setting up the DVC timeshare system, it was done this way as a function of being located within the WDW property.

And the transportation costs are included as part of resorts expenses so cash guesrs pay their share of that via the cash rate they pay for their onsite stay.

Obviously. If they eliminated transportation to the parks for onsite guests, we would no longer be paying or have access to it…but, as it stand as like now, it is part of the expenses our resort has.

 

[Chuck S]

Obviously. If they eliminated transportation to the parks for onsite guests, we would no longer be paying or have access to it…but, as it stand as like now, it is part of the expenses our resort has.

Or if DIsney disconintued bus service to the parks, DVC could contract it privately through another provider like Mears, which also would be billed out to our dues. There are onsite resorts, like Shades of Green that do contract out their transportation privately.

 

[Yankee626]

The way that the POS was set up was to include the ability of things like transportation to and from the parks to be part of the expenses of the condo association

We get access to all the onsite perks as well as part of our contracts. My guess is that in setting up the DVC timeshare system, it was done this way as a function of being located within the WDW property.

And the transportation costs are included as part of resorts expenses so cash guesrs pay their share of that via the cash rate they pay for their onsite stay.

Obviously. If they eliminated transportation to the parks for onsite guests, we would no longer be paying or have access to it…but, as it stand as like now, it is part of the expenses our resort has.

If you are paying for a room you don't need the transportation. But if you buy a Park ticket then you do need the transportation . My point is that the transportation to the parks is for the parks and should be their expense. I'm sure it doesn't amount to much . Who does it benefit in the long run ; Disney or the customer. If Disney chose not to have any transportation to the parks it would cause an extreme stress on the system . They have to provide transportation and they should pay for it.

 

[_auroraborealis_]

Hotel guests are also contributing towards transport.

 

[john7994]

Its not without precedent I guess. We own properties in several counties and pay property taxes on all of them. A large part of those property taxes go to subsidize schools amongst other things. We have never had children, so should we be paying that portion of property tax? However, when we went to purchase those properties, we understood the implication of our obligation in property taxes.

I understand this may not be a perfect analogy to your post, but largely, we understood this obligation in owning DVC. I guess the alternate is that gate prices for the parks would be higher, not entirely sure anyone escapes the cost altogether. Disney found a way to spread the pain, given that the hotels likely wouldn't need to exist without the parks. I don't think many of the resorts really qualify as standalone (Maybe AKL?) without the parks.

 

[Sandisw]

If you are paying for a room you don't need the transportation. But if you buy a Park ticket then you do need the transportation . My point is that the transportation to the parks is for the parks and should be their expense. I'm sure it doesn't amount to much . Who does it benefit in the long run ; Disney or the customer. If Disney chose not to have any transportation to the parks it would cause an extreme stress on the system . They have to provide transportation and they should pay for it.

I get that but when you buy a DVC, you are buying a timeshare that includes transportation to the parks as part of the operating costs of that resort.

It’s part of the product and how it was set up when Disney decided to begin the DVC concept. It is in the POS that your ownership interest includes access to all the onsite benefits given to other onsite guests..who also pay for them via the cost of those with the cash stay.

Its really no different in terms of expenses than building a pool and having owners pay for its upkeep…not everyone will use it but it’s offered as part of the resort…

The point is what you bought requires you to pay for the transportation to/from the parks.

 

[Yankee626]

I get that but when you buy a DVC, you are buying a timeshare that includes transportation to the parks as part of the operating costs of that resort.

It’s part of the product and how it was set up when Disney decided to begin the DVC concept. It is in the POS that your ownership interest includes access to all the onsite benefits given to other onsite guests..who also pay for them via the cost of those with the cash stay.

Its really no different in terms of expenses than building a pool and having owners pay for its upkeep…not everyone will use it but it’s offered as part of the resort…

The point is what you bought requires you to pay for the transportation to/from the parks.

I wonder if Disney had the Transportaion costs as part of the hotel expense before DVC started ?

 

[Sandisw]

I wonder if Disney had the Transportaion costs as part of the hotel expense before DVC started ?

Yes..it’s built into the rate for cash stays. I look at it this way..

Disney owns their hotels and we own the DVC villas. Each provides transportation to the parks as part of its amenities and we each pay for a share of those costs.

The difference is that we, as owners, are contracting with Disney to provide the option to us..so, if they decide to no longer off it to their cash guests..like they did with DME..then we lose it and would have to decide as a condo association if we wanted it back and hire an outside contractor.

Now, before DVC resorts existed, all those costs were paid just by Disney..but DVC resorts do exist and when created, as I said, it was built in as an operating cost for those resorts, and as owners, we are responsible for all operating costs for the resorts we own.

 

[Chuck S]

I wonder if Disney had the Transportaion costs as part of the hotel expense before DVC started ?

Of course they did. Every expense has to be justified and paid for, don't expect any business to just absorb that kind of cost without a line item showing how it is paid.

 

[Yankee626]

Of course they did. Every expense has to be justified and paid for, don't expect any business to just absorb that kind of cost without a line item showing how it is paid.

My question wasn't if there was a line item of expense but if it was a line item for the parks or the hotel side. I'm quite sure the employees that work in transportation are not managed by the hotels.

 

[Yankee626]

Would you offer discounts to customers that have already gave you $$$ and are alrady commited to paying yearly fees for the next 20+ years? I wouldn't. They are still selling DVC's at a good rate and are building more units, without offering discounts. In business you offer discounts to draw customers, but when you already have a solid base there is no need.

This is true unless part of the sales pitch is that you will receive discounts as a DVC owner . To offer discounts for 30 years that were implied in your purchase to DVC owners and then take them away could be viewed as predatory sales tactics . Things such as Discounts on food , merch and tickets may not have been guaranteed but have certainly become common past practice since DVC started.

 

[Sandisw]

This is true unless part of the sales pitch is that you will receive discounts as a DVC owner . To offer discounts for 30 years that were implied in your purchase to DVC owners and then take them away could be viewed as predatory sales tactics . Things such as Discounts on food , merch and tickets may not have been guaranteed but have certainly become common past practice since DVC started.

Well, the document regarding perks does say specifically that they are not guaranteed and can be ended any time..and, as owners we sign off on that specifically when we purchase..

So, I can’t agree that it is predatory when they are make sure it’s clear to you when you actually agree to buy..and why FL timeshare law specially gives buyers that 10 days to back out..so they have time to make sure there isn’t something hidden in that fine print.

 

[Sandisw]

My question wasn't if there was a line item of expense but if it was a line item for the parks or the hotel side. I'm quite sure the employees that work in transportation are not managed by the hotels.

The transportation drivers may be part of a division that is managed differently but the money collected from the hotels from cash guests is used to help pay for thst division.

It’s like housekeeping is one division, food and beverage is another, etc, but we, as DVC higher Disney to be our property manager and they oversee all the smaller elements of operating the resort, which would include the division that handles transportation.

 

[tjkraz]

I can see how it could be argued both ways. But it isn't objectively wrong to call it a hotel expense, so I'd expect Disney to favor the approach that most benefits them. Especially since it's so clearly spelled out in the budget.

If a hotel or timeshare on I-Drive runs a shuttle to the Magic Kingdom, it's not a theme park expense. It's a hotel / timeshare expense. If a random Marriott offers an airport shuttle, that's not an airport expense. Same is true here, in that Disney transportation is a service provided to hotel & DVC guests. It's just a little more self-serving since Disney operates businesses at both ends.

 

[HashberryOTG]

Not all of the transportation is to parks. There's resort to resort, disney springs, etc. The cost is part of resorts whether cash or dvc. It's an amenity, whether you choose to use it or not. Sort if like you also still get charged for the parking lot whether you use it or not.

 

[Pooh12863]

I'm always amazed that people spend substantial amounts of money without understanding the product they've bought.