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MROP (ORE/VRI)Special Assessment!

Discussion in 'US - West Coast Timesharing' started by brg850, Dec 21, 2007.

  1. brg850

    brg850 Guest

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    I received a bill for the MROP special assessment for $250 per week interval a few days ago, just in time for the holidays.
    I called the Utah office and finally talked the office manager. According to her, the project to build the new condos in St. George Utah is about 60 percent done and it will be built out by April 2008. Now they need more money to pay the developer again but MROP were unable to sell the new intervals/memberships to get additional funding until the condos are ready. Utah law does not allow timeshare association to get loan on their real properties. Therefore came the special assessments....
    I have heard of special assessments because of major nature disasters, but not for this type of man made financial crisis. I am going to get a copy of the by-laws and see if this is legal at all to ask members money for this type of use.

    brg
     
  2. brg850

    brg850 Guest

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    Here's what I found out according to the paragraph from the bylaws, that the special assessment we received is not valid!

    In Vacation Handbook page 26, or MROP Bylaws page 18,

    Article VII Assessements And Enforcement.

    Section 7.04. Special Assessments.

    "However, Special Assessments shall not, in the aggregate, exceed 25% of the Maintenance Assessment for the applicable fiscal year, without a vote of the majority of a of a quorum of the members to approve such Special Assessment beyond 25%"

    I do not think this special assessment was approved by the members in the regular membership meeting or any special membership meetings at all.

    So take a look at the bylaws yourself and call the MROP office. The current president Noel S. Hyde (Utah) and past president Chris Fonnesbeck (Utah), their phone numbers are on the internet white pages and zabasearch.

    I have also left a message for the MROP/VRI "manager" Terry Bicco at 800-400-9950 ext 112 regarding the artificial special assessment without the members approval.

    brg
     
  3. brg850

    brg850 Guest

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  4. bogey21

    bogey21 TUG Member

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    All good things come to an end. ORE was great until they sold out. Now the greed takes over.

    George
     
  5. Kurt Brown

    Kurt Brown TUG Member

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    Thank you for the information

    I have sent them a letter explaining why I will not be paying the special assessment, to the effect that:

    "I am writing in protest of the recent special assessment of $250.00 per member week. This is an unacceptable reason for a special assessment.

    I am being asked to fund construction of a new resort, Canyon Villas at Coral Ridge Resort, where I will have no specific individual ownership interest, and where I have no intention of ever traveling.

    Your offices are located in Utah. You have somehow decided to build a new resort rather than continuing to gain access to existing resorts, for the Multi Ownership Resort Plan. I have to question the competence of that decision-making process. Your reasoning is, after construction has already begun, that
     
    Last edited: Dec 23, 2007
  6. Kurt Brown

    Kurt Brown TUG Member

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    Thank you for the information

    I have written a letter to them to the effect:

    "I am writing in protest of the recent special assessment of $250.00 per member week. This is an unacceptable reason for a special assessment.

    I am being asked to fund construction of a new resort, Canyon Villas at Coral Ridge Resort, where I will have no specific individual ownership interest, and where I have no intention of ever traveling.

    Your offices are located in Utah. You have somehow decided to build a new resort rather than continuing to gain access to existing resorts, for the Multi Ownership Resort Plan. I have to question the competence of that decision-making process. Your reasoning is, after construction has already begun, that “we have learned that Utah law prohibits secured loans or encumbrances against timeshare properties”.

    I have no objection to your noting on my account that since I am not participating in the construction of the new resort that I not be allowed to use it.

    Thank you for your understanding as to why I will not be paying the special assessment."

    (NOTE: At the time owners at my resort were being asked to join MROP, I asked the board to put out balancing information so that owners could make an informed choice. They refused to do so. I therefore voted AGAINST the resort joining MROP).

    Kurt
     
  7. jmparker98223

    jmparker98223 Tug Review Crew: Rookie TUG Member

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    WHOA! Think this through! Cool down!

    A special assessment never pleases anyone regardless of the circumstances. However, not paying is not an option unless you want to forfit your timeshare. See the By-Laws, they are very explicit on this.

    As a new owner/Member of MROP, it really fails to satisfy. The Board by way of their legal counsel either knew or should have known that Utah law prohibited encumbering the Association. Incompetence or malfeasence seems to be the order of the day.

    Our choices as mere owner/Members are limited but from my perspective they are:
    (A.) Encourage a simple majority of the members to attend either in person or by proxy to change the By-Laws to reign in the Trustees, empower the Members, establish conflict of interest rules for the Trustees and Board Members, and, for calling on a vote of the members for acquisition of new properties beyond some set dollar value.

    (B.) Enjoin the Board in a class action law suit to accomplish the goals outlined in (A.) above. This will take deep pockets and after all we will be suing ourselves.

    Nobody wins in a lawsuit.

    To acomplish the goals of (A.) a list of members and their addresses are required. Somebody will have to become the focal point for all this and spearhead the effort. Plus, as the old saying goes, it ain't free. A lot of effort and postage will be required as well as answering a lot of questions.

    Are you close to the MROP Office so you can drop-in and get the list of owners? I'm not! But, that is what it's going to take to get going.

    The number of replies to this post is a clear indicator that this isn't on the front burner for most folks.
     
  8. teepeeca

    teepeeca TUG Member

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    jmparker98223

    Most of the time, special assessments are a "necessary evil". HOWEVER, in this case, according to the by-laws, the special assessment CANNOT be imposed because it is more than the percentage allowed, without a vote of the membership.

    No vote of the membership has taken place.

    If it is an "illegal" special assessment, then you will NOT forfeit your
    week(s).

    Tony
     
  9. jmparker98223

    jmparker98223 Tug Review Crew: Rookie TUG Member

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    We out here in Owner/Member land can squawk all we want about what is 'legal' , 'illegal', or anything else, however the simple fact remains that the Board of Trustees sent out a special assessment.

    The Board of Trustees obviously feels that sending out the special assessment is a legitimate exercise of their power.

    So, how do you challenge the exercise of the Board of Trustees power?

    The only two ways that I know of is to Lawyer up or bring it up from the floor at a regular Member meeting. Do you have another approach?

    This is where the fly is in the ointment. Refusing to pay puts you in a delinquent status and thus voids your vote at the meeting. Foreclosure or forfeiture happens later.

    Are you ready to Lawyer up?
     
  10. Jya-Ning

    Jya-Ning TUG Member

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    Not an owner in the chain.

    Actually, from what I read, it is illegal, so they will have trouble to foreclose,

    look at this thread

    http://www.timeshareforums.com/foru...op-ore-vri-special-assessment.html#post189950

    They must find it out and now will plan to have a quick special meeting and use the uniformed owner's vote to pass it.

    You can inform as many owner as possible, and make sure they send no on their vote and not just let the board use their ignorance.

    Jya-Ning
     
    Last edited: Jan 2, 2008
  11. gravityrules

    gravityrules TUG Member

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    deleted, see following post.
     
    Last edited: Jan 2, 2008
  12. gravityrules

    gravityrules TUG Member

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    jmparker98223, I'm also in the process of becoming a MROP member so I'm not thrilled with what's happening here. What some posters seem to be missing in reacting to a special assessment (SA) is the issue of Utah law not allowing timeshare property to be used as collateral for a loan. Apparently MROP has operated for many years with loans secured by various timeshare properties. Part of the proposed SA is to pay off existing loans, part of it is to not have loans on the new St. George project. Perhaps in the process of trying to secure the new project financing this legal issue was discovered? It's hard to accept that things have been operating for years in an 'illegal' fashion (having outstanding loans secured by timeshare properties) without ORE (and now VRI) management and/or the MROP board realizing it.
    But to make matters worse, to try to rush in a last minute SA (notices apparently sent out in December, due in January) beyond the 25% SA allowed in the bylaws without a member meeting, runs completely against the owner friendly image MROP has tried to cultivate. Although I'm not happy about a SA, it's the lack of explanation and communication that worry me the most. Is this really a one time SA? Will the MFs be lower next year as a result?
     
  13. jmparker98223

    jmparker98223 Tug Review Crew: Rookie TUG Member

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    Thank you Jya-Ning. You appear to be correct, an end run will depend on un-informed owners not participating. Regarding what's legal or illegal depends on who is forcing the action. Several shallow pocket owners against the Board of Trustees don't have much of a chance.

    Let's do the math

    $450,000 (estimated) per unit times 12 = $5,400,000
    12 units times 50 weeks = 600 intervals for sale
    600 intervals times $5000 per interval = $3,000,000
    $250 special assessment time 10,000 owners (estimated) = $2,500,000
    $2,500,000 + $3,000,000 = $5,500,000

    So it looks like someone's real estate deal gets financed for free and the MROP Owners get the bill. It does not seem that this is something that any MROP Owner would want to scratch and sniff.

    We need someone in Salt Lake City to get a list of Owners/Members so we can start a campaign to answer the classic Roman question Qui Bono? Who benefits? It doesn't seem to be the membership. All we would get out of this is the bill via the Special Assessment and an increase in Maintenance Fees next year. Unfortunately I'm several thousand miles from Salt Lake and can't get there to get the list myself.

    Hellooooo!!! Is there anybody near the MROP Offices interested in this issue????
     
  14. Bill4728

    Bill4728 Moderator

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    Since this thread has nothing to do with Buying or selling, I've moved this to the western US board.
     
  15. shagnut

    shagnut TUG Member

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    I received my sa and couldn't believe it. I just paid the mf's!!! I am very close to telling them to keep my week, except for the fact I've just paid my fees and want to use a week. I will probably pay this one time but I will sell it or give it away if this happens again.

    I remember many years ago they wanted a one time fee of 5 thousand which would give us one week in a gold crown resort they wanted to build in St George. I voted NO, they called me and wanted to know why. I told them I only paid $500 in the first place and I had more than enough vacations to feel if I lost it I had more than used it. Of course, they didn't get enough support to do anything.

    As my originial deed was in St George they said they wanted to build a new resort in St George so we would have a week to go there.

    Stinks, it almost makes me want to get out of ts altogether.

    shaggy
     
  16. gravityrules

    gravityrules TUG Member

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    I don't want to be in the position of defending this SA, but aren't we all overreacting to a one-time SA of $250? I'm sure there are MANY Tuggers who can comment on their experience with 'special assessments'. I can understand the frustration, but 'suing the MROP board' or 'getting out of timesharing' are rather extreme reactions. Why is the assumption that the MROP board has suddenly switched to the 'dark side'? I would like a thorough explanation and accounting of the SA, the 'no debt' Utah law recently 'discovered' and the story on the new St. George resort (the benefit this has for existing MROP members other than adding 600 more St. George weeks to the pool).
    If I'm interpreting the sketchy information correctly, MFs should GO DOWN next year, at least to the extent that some of the previous MFs serviced debt. And then the sales of the new weeks would go into the reserve fund.
    We can certainly question whether the new resort in St. George was the best use of MROP funds but that decision seems to be past the point of return.

    If the MROP board was trying to get members to go for a new resort 'years ago' (pre VRI) at a 5K pop, then that seems to indicate to me this has nothing to do with VRI.
     
    Last edited: Jan 3, 2008
  17. jmparker98223

    jmparker98223 Tug Review Crew: Rookie TUG Member

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    The ultra vires exercise of power simply has to be challanged and the tort feasors held accountable. There is no dark side, only the legitimate exercise of power or something else. When we are coerced into the something else we start down a slippery slope from which there is no return and rules to fit the circumstances are created and imposed - the By-Laws will have become notes of convienence. Once power is granted it is very difficult to retract. See: http://en.wikipedia.org/wiki/Ultra_vires

    The following letter has been sent to MROP regarding the assessment: It is my hope that readers of this posting may find something useful by reading it.

    Mr. Gerald Thompson, Secretary
    Multiple Resort Ownership Plan
    1521 East 3900 South,
    Salt Lake City, Utah 84124



    Dear Mr. Thompson,

    Recently, I learned of a special assessment required to “…eliminate all outstanding loans…” related to certain properties that the MROP Board of Trustees has decided to acquire for use by the membership.

    In reading through the Corporate Charter and By-Laws I have noted the “Purpose of Assessment” is defined in Section 7.02 and that Section 7.04 defines the requirements for the levying a “Special Assessment”.

    The December 5, 2007 letter from MROP President Noel S. Hyde, announces the levying of a “Special Assessment” that meets none of the definitions of “Purpose” nor does it meet those of a “Special Assessment” nor does anything in the President’s Letter meet the requirements of a “Special Assessment” as defined in the By-Laws.

    The By-Laws are explicit: "However, Special Assessments shall not, in the aggregate, exceed 25% of the Maintenance Assessment for the applicable fiscal year, without a vote of the majority of a of a quorum of the members to approve such Special Assessment beyond 25%"

    Therefore, your presentment of “Special Assessment” has been refused for cause and is attached herewith.

    Not withstanding anything in the foregoing, I have several questions relative to this acquisition and Mr. Hyde’s Letter:
    1. Was there a polling of the membership to determine whether or not sufficient membership interest in that geographic area warranted acquiring properties at the Canyon Villas at Coral Ridge?
    2. On what date did the MROP Officers and or Board of Trustees arrive at the decision to acquire the Canyon Villas at Coral Ridge property?
    3. Is this decision reflected in the minutes of the Corporation?
    4. Were other geographic areas considered at the same time as the Canyon Villas at Coral Ridge for acquisition of additional timeshare units?
    5. Was the legal counsel retained by the Corporation apprised of the facts of the purchase of Canyon Villas at Coral Ridge either before or after consummation of the transaction?
    6. Did the counsel provide advice to the Board of Trustees or the Officers of the Corporation regarding this the purchase of the Canyon Villas at Coral Ridge?
    7. If advice was provided by counsel is that advice a matter of record in the minutes or records of the Corporation?
    8. During the meeting at which the decision was made to acquire 12 units at the Canyon Villas at Coral Ridge were the MROP Officers and or Board of Trustees aware that it would experience a shortfall of funds during the consummation of the purchase?
    9. During the meeting at which the decision was made to acquire 12 units at the Canyon Villas at Coral Ridge did the MROP Officers and or Board of Trustees discuss the fact that the magnitude of the special assessment was in excess of the limits established in Section 7 et. seq. for a special assessment?
    Please do not ignore this request for information.
    Kindly notify me of the time and place of any Special Meetings of the Members.

    Respectfully,
     
  18. gravityrules

    gravityrules TUG Member

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    A poster in that 'other TS forum' says the MROP board is now planning to call the required meeting. If so, that implies acknowledgement that the present SA does not meet the by-law requirements.

    Other than working within the bylaws (both in letter and in 'spirit') and having meaningful, honest 2 way communication with the members, what are you wanting the MROP board to do? Would you agree that MROP should be in compliance with Utah law? Are you asking the board to abandon a half completed 12 unit resort? I don't like an SA either, but please explain any options that are better for this present situation. It seems to me that some posters are not going to be happy with any outcome other that no SA, but is that realistic? I agree that MROP 'should not have got into this mess' but that sentiment does nothing to address the present issues.

    Perhaps the place to start would be for the board to send out SA retraction letters explaining the by-law requirements along with a meeting notice and detailed financial information explaining the basis of the proposed SA. There would also need to be a thorough discussion of the new St. George project.
     
  19. CharlesS

    CharlesS TUG Member

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    Do I understand this correctly?

    I am not prepared to discuss the merits of the SA but I would like to know if I understand the history. Tell me where I am wrong.

    1. The owners elected the Trustees of the HOA (the policy making group).

    2. The HOA borrowed money for whatever.

    3. The HOA hired a new management group (VRI).

    4. VRI told the HOA that they were doing something wrong in the borrowing and that they have to correct it.

    5. HOA decided on an SA and failed to adequately inform the members of their rational of the need for the SA.

    6. The amount of the SA as approved by the HOA violated the by-laws.

    Thank you, Charles
     
  20. gravityrules

    gravityrules TUG Member

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    1. Yes

    2. Yes -
    Reason A from SA letter "As you may know, since its organization over twenty years ago MROP has obtained loans from time to time to pay for such things as catastrophic damage from weather related events at some of our resorts."
    Reason B From the SA letter it appears the board planned to finance the construction of the new 12 unit Canyon Villas at Coral Ridge resort.

    3. Yes - actually the previous non-profit management firm ORE was purchased by VRI in 2006.

    4. Unknown - I haven't seen an explanation of how or when the board became aware of the legal issues. Whether this is due to imcompetence or 'malfeasance' (as the previous poster says) of the present or previous MROP board, management, or legal counsel ... I don't know.

    5. Debatabe, but Yes (IMHO) - the explanation was contained in the SA letter sent out in December with the SA due in January. Here's the gist of it: "In order to eliminate all outstanding secured loans and to provide the funding to complete the new Canyon Villas at Coral Ridge without any debts or encumbrances, your Board of Directors has authorized a special assessment". The explanation is insufficient, the timing is bad, and too little time is allowed for owners to deal with the SA.

    6. Yes


    FYI, here's a link to the 2006 Annual meeting minutes:

    http://www.multi-resorts.com/documents/Annual_Meeting_Minutes.pdf

    Does anyone have minutes of the 2007 annual meeting?
     
  21. lynnray

    lynnray TUG Member

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    Confused and concerned

    In March 2006 we went to a TS presentation at the Snow Canyon Villas and made the mistake of purchasing 108,000 RCI points for $18,000. We were told at the time that this would be our home resort and many other things that have turned out to be untrue. We are owners and part of MROP and have not received any letter regarding a special assessment. Maybe the owners who already paid a large chunk of money flor Snow Canyon are not included in the SA, but it that would also seem to go against the by-laws of the association.

    We actually live in St George. I am going to go to Snow Canyon Villas and see if I can get any additional info. I do not trust the sales people there at all, but I will see what I can find out.
     
  22. lynnray

    lynnray TUG Member

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    found this post re: MROP/ST George

    I found this posting on www.streettalkblog.com - it goes back to my last post that the salespeople from WROMAN are crooks. I am going to the UT State Attorney General about their sales practices and deceipt. They absolute misled us about what we were buying.


    "Word on the street says that Wroman has not learned its lesson about selling inventory without the deeds. Consider this rant:

    They did it at Landmark Holiday Beach Club in Panama City, Tahoe Beach and Ski in Lake Tahoe, Inverness at South Padre, Royale Beach and Tennis in South Padre and The shores of Lake Travis in Texas. After consumer complaints reached the Attorney General’s office or the clients attorney’s started calling, Wroman would try to make the owner take another property in place of the one sold or a refund that would usually take months to deliver. Now they are in St George, Utah selling unsuspecting souls on the beauty of the soon to be developed Snow Canyon timeshare units. Only problem is, they are selling the MROP program. The owners receive a membership, not deeded anywhere, that allows them the ability to trade within the current MROP family of resorts. People who have bought into the false pitch of owning in Snow Canyon are starting to complain. Wroman is telling people that construction is delayed due to the developer, Split Rock Development, having problems getting the project started.
    I can say that Wroman has earned a less than glorious reputation within the industry nearly since they day they opened their doors to sell RCI Points, if our inboxes are any indication. So IF the above is true, I for one would not be surprised."
     
  23. jmparker98223

    jmparker98223 Tug Review Crew: Rookie TUG Member

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    On Jan. 3, 2008 at 3:17 am GRAVITY RULES wrote:
    Other than working within the bylaws (both in letter and in 'spirit') and having meaningful, honest 2 way communication with the members, what are you wanting the MROP board to do? Would you agree that MROP should be in compliance with Utah law? Are you asking the board to abandon a half completed 12 unit resort? I don't like an SA either, but please explain any options that are better for this present situation. It seems to me that some posters are not going to be happy with any outcome other that no SA, but is that realistic? I agree that MROP 'should not have got into this mess' but that sentiment does nothing to address the present issues.

    Is there some problem with “working within the bylaws (both in letter and in 'spirit') and having meaningful, honest 2 way communication with the members?”

    It is very difficult to determine the proper course of action when there is a absence of facts and candor. The term that seems to apply is “Full Disclosure” and that is what we do not have from the current Board of Trustees or the Officers of the Corporation. We the Members and Owners don’t really know the full extent of the present issues. Consequently we Owners and Members cannot ameliorate the situation.

    It isn’t clear from any of the documents provided by the Board of Trustees or the Officers of the Corporation that an actual contract has been consummated. It isn’t a clear established fact that the Association is at the present out of compliance with Utah Law. Until these facts are known, the only clear facts are:

    1. MROP is supposed to be a non-profit corporation established for the benefit of the Members/Owners.
    2. The Corporation has a Charter and By-laws that are supposed to govern the activities of the Corporation.
    3. The Special Assessment, as presented, is in violation of the By-Laws.
    4. The Board of Trustees or the Officers of the Corporation knew or should have known that the Special Assessment as written was beyond their power without a vote of the Members/Owners.
    5. The Board of Trustees or the Officers of the Corporation knew or should have known that Utah law does not allow timeshare association to get loan on their real properties.
    6. Legal counsel retained by the Association for advice knew or should have known that Utah law does not allow timeshare associations to encumber their real properties with loans.
    7. The 2006 Audit Report shows that $26,001.00 was budgeted for Legal and Professional Fees.

    What is missing here is some candor and visibility into the operations and decision making by the Board of Trustees or the Officers of the Corporation. We do not know if any of the Board of Trustees or the Officers of the Corporation has a conflict of interest between the Canyon Villas at Coral Ridge Resort and MROP.
    We the Members and Owners do know that we need some changes to the By-Laws to provide prohibitions against conflicts of interest, greater visibility into operations and decision making, some dollar limits on expenditures that can be made without a vote of the Members and Owners, and a pledge to ethical conduct of operations on behalf of the Members and Owners.
     
  24. ragtop

    ragtop TUG Member

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    So what I don't get is why VRI bought the management contract for MROP if not to make money and why problems like this didn't turn up when they were doing their pre-purchase investigation? And how will VRI benefit from the SA now being imposed? Are they paying too:doh: ?
     
  25. CharlesS

    CharlesS TUG Member

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    Does MROP just own deeds to individual unit/weeks at various resorts or does MROP also own some "resorts" in the sense that MROP also owns the swimming pool, restaurant, registration building, and/or golf course, etc.?

    When VRI (a management company) bought ORE (another management company) they got stuck with ORE's bad contracts as well as the good contracts. (I don't know if, in the long run, MROP will turn out to be good or bad for VRI).

    VRI benefits from its contracts. Of course the contracts have to be renewed by the HOA's that hire VRI. So VRI will benefit if the MROP assets, etc. are properly managed in an ethical and fiscally responsible manner such that the HOA's are happy and the owners(members) (who elect the HOA's) are happy. If MROP was doing something illegal or not responsible, VRI has to help them get out of the mess. If VRI does something illegal and the other VRI managed resorts find out about, VRI will lose many of their contracts, so VRI has to make sure that the resorts it manages are run on the up and up. (By the way, previous messes made by previous HOA's and/or developers and whether legal or not cost money to fix. The only source of money is Special Assesments.)

    VRI will also benefit if they can help do away with black eye practices which give timeshares a bad name.

    Regarding the question about VRI paying too, VRI is paying in having to put extra effort in to get the HOA to fix past mistakes rather than just managing things and looking forward.

    Charles
     

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