# SVO Email regarding WKORV-N/S Tax Lawsuit



## DeniseM (Aug 19, 2013)

Hot off the press: 




> Dear DeniseM;
> 
> As board members of the Ocean Resort Villas Vacation Owners Association and the Ocean Resort Villas North Vacation Owners Association (“Associations”) respectively, we are writing to inform you of a lawsuit filed by the Associations against Maui County and the Maui County Council regarding the real property tax rates applied to timeshare resorts.
> 
> ...


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## Ken555 (Aug 19, 2013)

Nice. It will be interesting to watch this unfold.


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## DavidnRobin (Aug 19, 2013)

I hope the other large Maui Timeshare HOAs have joined in this lawsuit.


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## sjsharkie (Aug 19, 2013)

It will be interesting to see which HOAs participated from the filing once it is published.

I am very interested in the outcome since Oahu recently passed a bill to segregate timeshares as a separate class for property taxes.  One would expect the other islands to follow suit unless something is done (like this lawsuit).

-ryan


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## jarta (Aug 19, 2013)

Given the decision of the SCOTUS in Armour v. Indianapolis in June of 2012, it will be a very hard case to win.

http://jurist.org/paperchase/2012/06/supreme-court-rules-on-equal-protection-in-taxation.php

Any rational basis may justify the different tax treatment.  Essentially, the plaintiff must prove a negative.  No rational basis for the unequal treatment.

From the official case headnotes:



> The City’s classification does not involve a fundamental right or suspect classification. See Heller v. Doe, 509 U. S. 312, 319–320. Its subject matter is local, economic, social, and commercial. See United States v. Carolene Products Co., 304 U. S. 144, 152. It is a tax classification. See Regan v. Taxation With Representation of Wash., 461 U. S. 540, 547. And no one claims that the City has discriminated against out-of-state commerce or new residents. Cf. Hooper v. Bernalillo County Assessor, 472 U. S. 612.  Hence, the City’s distinction does not violate the Equal Protection Clause if any reasonably conceivable state of facts that could provide a rational basis for the classification,” FCC v. Beach Communications, Inc., 508 U. S. 307, 313, and the “ ‘burden is on the one attacking the [classification] to negative every conceivable basis which might support it,’ ” Heller, supra, at 320. Pp. 6–7.


   Salty


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## PamMo (Aug 19, 2013)

Sorry, Jarta, but there is no reasonable rationale for the exhorbitant tax rate applied to the timeshare classification of real property. The Maui County Council has argued that timeshare owners use a disproportionate share of local assets (road, water, sewer) and add nothing to the local economy. The feeling is that timeshare owners and their guests hunker down in their timeshares, don't eat out, go on tours, and generally add nothing to local economy. What a bunch of bunk! We certainly rent cars, buy groceries, go to our favorite restaurants, go on snorkel and sail tours, etc. When the economy was at its worst, hotel occupancy was WAY below timeshare occupancy. Timeshare owners are simply easy pickings since we have no vote.

Rant over.


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## jarta (Aug 19, 2013)

Pam,   ...   Don't shoot the messenger.  I said it will be very hard to win.  I did not say it was impossible to win.



> The feeling is that timeshare owners and their guests hunker down in their timeshares, don't eat out, go on tours, and generally add nothing to local economy.



I hope the Starwood resorts have some evidence to prove that this feeling is irrational.  It is their burden of proof to do so.  It's a very tough burden to meet.  

In the Indianapolis case, Indianapolis said it would cost money to make any refunds to those who prepaid 100% proportionate to those who paid over time and had their unpaid payments fully abated.  6 of the 9 justice of the SCOTUS said that made it all OK.  The 3 dissenters said that the difference in treatment amounted, in some cases, to 30 to 1.

Of course, Indianapolis spent the money paid and couldn't afford to make refunds to equalize the overall tax effect on all taxpayers (pre-pay and over time).

I am a property tax attorney.  jarta = my initials + ta (for tax attorney).   Salty


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## SMHarman (Aug 19, 2013)

jarta said:


> Given the decision of the SCOTUS in Armour v. Indianapolis in June of 2012, it will be a very hard case to win.
> 
> http://jurist.org/paperchase/2012/06/supreme-court-rules-on-equal-protection-in-taxation.php
> 
> ...


true but when the same rooms are rented as hotel rooms and condos are rented weekly you have a good start on pulling apart the rational basis. 

There is also a study that was linked on a post here recently that pulled apart their logic and was paid for by the tax body. 

This is not open and shut. 



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## sjsharkie (Aug 20, 2013)

I think there is argument that there is little difference between timeshare and hotel usage - the transient stay pattern is somewhat similar. Hotels may have a slightly shorter average stay, but even that difference is narrowing with point systems. 

Equating timeshares with condos might be a tougher sell. They can be used for rentals but they can also be used for permanent residency. 

Ryan

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## DavidnRobin (Aug 20, 2013)

First no opinion was given - just a link with description.

I looked at the SCOTUS decision - and do not see the link between the two circumstances other than they both relate to property taxes, but the situation is different. It would appear to be similar if they were 2 different tax rates (eg. grandfathered) within the same category.  But, this is a about an unfair rate between category types.

Also, I would assume that the probability of failure was considered by the HOAs with input from SVO (and likely other TS groups) -  as well as the strategy to cause Maui time and effort (therefore $$$) to get some consideration of reduction and better alignment with other catagories.

Didn't St John successfully fight an unfair property tax being levied by the USVI? Doesn't the USVI follow US law in these matters?  This would be more similar - where one party in same category has different tax rate.

Regardless, interesting...


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## Westin5Star (Aug 20, 2013)

Since I am not to talk about politics or taxes here on this forum, I will just say that I love swim up bars.  I am actually at WKORV and our stay has been great so far.  The maintenance and service have been excellent thus far.


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## LisaRex (Aug 20, 2013)

jarta said:


> I hope the Starwood resorts have some evidence to prove that this feeling is irrational.  It is their burden of proof to do so.  It's a very tough burden to meet.



Maui Council was kind enough to commission such a study that I'm sure the plaintiff's attorney will use: 

http://www.co.maui.hi.us/documents/3/timesharestudy.pdf

Among their findings: 

Overall, timeshare visitors account for a small portion of total Maui visitor expenditures. Timeshare visitors stay slightly longer than hotel visitors and spend more per person per day on non-lodging than condo visitors.

Timeshare visitors account for only 1.8% of Maui visitors, but account for 4.8% of total Maui visitor expenditures and 6.3% of annual non-lodging expenditures.

Excluding lodging, timeshare visitors have a similar spending pattern to condo visitors and, in fact, spend more per person per day. It is also notable that timeshare visitors spend a portion of their budget on additional lodging nights beyond their timeshare stay.

The increase in timeshare units occurred during a period while unemployment declined in Maui County and on the island of Maui. 

Activity participation by timeshare visitors were similar to those staying in condo hotels.

Participation in economic generating activities (e.g. shopping, sightseeing and entertainment) outside of the hotel and in the community appear to be higher with timeshare visitors when compared to hotel guests.

Timeshare visitors compared similarly with recreational activities with hotel guests, but much less in backpacking and hikes, presumably in county, state and federal park areas.

Timeshare visitors appear to participate in more cultural events on the Island of Maui when compared to hotel visitors.

As with condo visitors,timeshare visitors are much more frequent users of rental cars.


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## jarta (Aug 20, 2013)

> First no opinion was given - just a link with description.



The link to the opinion is in the first line of the linked article (on Monday ruled 6-3 [opinion, PDF]).  Link:  http://www.supremecourt.gov/opinions/11pdf/11-161.pdf

See Headnote on p. 2 of the Syllabus.  See text on p. 7, 10-11 of Opinion for the method of analysis.  See text on p. 12-13 of Opinion for a distinguishment of cases where a violation of Equal Protection was found.  Allegheny Pittsburgh Coal Co. is a 1989 case where the Supreme Court found a West Virginia de facto discriminatory valuation system to violate Equal Protection:



> The Court then noted that, in light of the state constitution and related laws requiring equal valuation, there could be no other rational basis for the practice. Id., at 344–345. Therefore, the Court held, the assessor’s discriminatory policy violated the Federal Constitution’s insistence upon “equal protection of the law.” Id., at 346.



Taxes are generally based on 2 factors.  The valuation and the rate.  Allegheny Coal related to assessment.  Maui's tax policy relates to rate.  I can find no specific clause in the HI Constitution which mandates equality of taxation.  The resorts will argue Allegheny Coal should be expanded.  

Tough case.  They are all tough because courts know local government needs money!  Courts rarely interfere with the flow of money to government.

I am assuming the obvious challenge, an Equal Protection challenge.  If the resorts are making some other arguments (like Interstate Commerce or substantive Due Process), the Equal Protection standard of analysis of the facts would not apply to those arguments.  

Finally, cases can always be settled without a definitive decision.  Maui County could re-evaluate and back off.   Salty


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## jarta (Aug 20, 2013)

> Maui Council was kind enough to commission such a study that I'm sure the plaintiff's attorney will use.



Lisa,   ...   The study was presented to Maui County in 2006.  It was prepared by Hospitality Advisors Inc. and the School of Travel Industry Management of the University of Hawaii.  Both have closer ties to the industry than government.

The first conclusions of the report (p. 37) are:



> Problems that Maui faces are real and timeshare conversions likely contribute, to some degree, to these
> issues, but the specific impacts (both positive and negative) is not possible to measure at this time due to:
> Lack of data for such a specific and comparatively small segment.
> Expansion in the overall economy and the addition of newly built timeshare inventory and
> ...



A lot has happened since 2004 data was used for the study.  The resorts should certainly try to use the study.  Maui will likely say the study says the specific effects are not measurable and the study is out-of-date because of the conversions and building of new timeshare buildings after 2004.  Plus even then the study concludes timeshares likely contribute to the problems Maui County faces.  Tough case.   Salty


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## PamMo (Aug 20, 2013)

The high taxation issue is not just financial, it's emotional for many locals. Unfortunately, we owners (approx. 2,500 units X 52 weeks) have little say when it comes to our RE taxes. Only recently have we become more vocal, and that was due largely to the efforts of ARDA, after the mayor proposed raising the rate to $19.60 in 2011. It will be interesting to see where this lawsuit goes. The Maui County Council plays hardball to get what it wants. I own some units at The Whaler, and our HOA is trying to build a parking garage. The council has stipulated that we must add 25 parking spaces for locals and provide beach access through the resort. Negotiations have been ongoing for awhile.


Maui's high timeshare tax is a topic that comes up every time a new budget is proposed in Maui. Some previous TUG threads:
http://www.tugbbs.com/forums/showthread.php?t=168468
http://www.tugbbs.com/forums/showthread.php?t=143327


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## jarta (Aug 20, 2013)

^^^   Pam,   ...   I hope the suit is successful.  Where I differ from you is that I think a suit based on Equal Protection is a hard suit to win.

About a year ago, the SCOTUS refused to hear this 2012 appeal from Hawaii involving discrimination by race (native v. non-native).

http://blog.pacificlegal.org/2012/s...ew-of-hawaiis-race-based-property-tax-scheme/

Salty


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## DavidnRobin (Aug 20, 2013)

So... What is to stop them from increasing a property tax rate to 15%, 30%... 100% on Timeshares as the ability to prove a negative is always inherently challenging (basic statistics).

Plus, against Maui, are local government officials open disdain (documented) for TS Owners showing clear bias versus an analytical analysis of the tax rate that is disproportionate to other tax rates.


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## PamMo (Aug 20, 2013)

Many in Maui believe hotels are more valuable to the local economy vs timeshares. A bill was just proposed to eliminate all timeshare development in hotel zones in Maui (WKORVNN?). The bill was deferred to allow for more study.  http://co.maui.hi.us/Blog.aspx?IID=100


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## jarta (Aug 20, 2013)

DavidnRobin said:


> So... What is to stop them from increasing a property tax rate to 15%, 30%... 100% on Timeshares as the ability to prove a negative is always inherently challenging (basic statistics).
> 
> Plus, against Maui, are local government officials open disdain (documented) for TS Owners showing clear bias versus an analytical analysis of the tax rate that is disproportionate to other tax rates.



David,   ...   Maui local government officials can have disdain for timeshares and their owners.  If, in their disdain, they can find a rational difference for treating timeshares differently for property taxation purposes, they can do so.  This suit will test whether Maui local government officials have any rational basis for treating timeshares differently than other property.

Adopting a dumb policy that will discourage tourism is not the same as adopting a totally irrational policy.  Obviously, from your standpoint, the disparity of treatment is pretty dumb.  

In CA, you and Robin are protected by Prop. 13 from assessment increases until you sell (or die).  Those who move to CA receive no protection.  They get whacked by property taxes as part of CA's "Welcome Stranger Package!"  Is that fair?

Almost every State gives a homestead exemption to in-State home owners.  Is that fair to business owners or those who own a 2nd home in a distant State?  (Note: fairness is *not* the standard.)

100% taxes?  lol!  The Takings Clause of the 5th Amendment would protect timeshares from confiscatory taxes.  I don't think Maui is there yet.  Of course, you are free to disagree.  http://en.wikipedia.org/wiki/Reductio_ad_absurdum   Salty


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## DavidnRobin (Aug 20, 2013)

I was just taking the next step in the argument - if the reason to raise taxes is because Maui needs the money (they can always prove that...), then Maui can focus on one sector such as Timeshares (e.g.) to raise property taxes (according to the ruling...) and thereby forcing the TSs to prove a negative (see Post #5), and with soft data such as this - proof becomes almost impossible from a statistical standpoint. Therefore Maui can justify any increase in taxes even to the absurd amount of 100%, and will likely win in a court of law as they have this ruling supporting them.

What I am saying is that I do not believe the ruling applies here (not buying it...) - as it is not the same... but you are the tax law expert. But (respectfully) you still haven't made a compelling argument other than throwing around legalize versus a simplied version that non-Legal folks can understand.  This is a great skill to have... I have to do this often in my field (as you are aware).  So... how about a simple straight-forward summary as to why the HOAs (aka... us) have a small chance of winning a fight against Maui because of the SCOTUS ruling?

I am sure the TS HOAs must have seen a path forward - and I hope so because they are using our MFs to take the case forward (which is of more importance to me) - if the chance is so slim (according to the SCOTUS ruling) - why would they proceed as there would be great risk without benefit (a large negative expected value).


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## jarta (Aug 20, 2013)

David,   ...   ^^^  Short answer to your request:  With a presumption that local government has acted properly and when you have to disprove every opposing possible justification, it is hard to win.

In law, the facts may change.  But, the settled principles of analysis usually remain the same.  From what you posted in the first 2 paragraphs above, I think you get it.  You just don't like the probable result produced by the principles of analysis.

The suit was filed a few days after the proposal to prohibit all new timeshare construction or conversion in hotel areas was introduced and deferred.  Link in PamMo's post.  I would expect Starwood and the other developers are picking up most of the cost.  Maui wants to trash all new timeshare development; the developers have responded with an attempt to trash the Maui tax classification system.  It should be an interesting battle.

But, I still can't find news of the actual suit being filed on Google.   Salty


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## Bob808 (Aug 20, 2013)

This dark cloud seems to underline risks associated with timeshare ownership.


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## DavidnRobin (Aug 20, 2013)

What I assume is that the legal experts of the large TS groups (assume more than WKORV and WKORVN are going to take up this battle) must have considered the issues and potential outcomes and therefore it is not so black/white as to having little chance of winning, or forcing comprimise.

When it comes to acting properly - this goes to 2 points: 1) the very large disparity of the tax rate for TSs vs the tax rates on others (especially Hotel rates), and 2) the open disdain for TSs and TS owners that have been made public by government officials.  This goes to acting properly since the disparity is so great - as this is not acting properly or reasonably.  Hard for me to imagine these comments would not be used against them because it shows clear bias with untrue and undefendable statements being made.  Officials' logic for the higher reates has been that TS Owners do not contribute to the economy as contributed (relatively) by Hotel users. I think from our collective experience we know this to be untrue - so it should be hard to prove and shed light on the unfairness of the TS tax rate.

Regardless - it will be interesting.  In the meantime - will WKORV/N hold some Ad Valorem tax monies back from Maui (in an 'escrow' account - or equilvalent) while this works it's way thru the court system? If so, I would imagine Maui would be hurting without these monies that they have already likely accounted for.


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## SMHarman (Aug 20, 2013)

DavidnRobin said:


> Regardless - it will be interesting.  In the meantime - will WKORV/N hold some Ad Valorem tax monies back from Maui (in an 'escrow' account - or equilvalent) while this works it's way thru the court system? If so, I would imagine Maui would be hurting without these monies that they have already likely accounted for.


And what share of these extra tax dollars will now be spent on the legal case?
Seems that TS is a fairly small part of the taxable base, hence the high rates needed to be able to make a dent in the budget. 


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## PamMo (Aug 20, 2013)

More bedtime reading...

The mayor's proposed 2014 budget: http://www.co.maui.hi.us/documents/...40-03-Revenue Overview_201303241300281423.pdf

So, just how much do timeshare owners contribute to Maui tax revenues? http://www.co.maui.hi.us/documents/3/38/623/2012AY_FY13MayorProposedValues.PDF

Maui Island Plan 2030: http://www.co.maui.hi.us/documents/17/69/71/3828/Chapter 1_201304191329387793.pdf

And lastly, a long, but interesting record of minutes from the Maui County Council meeting last year, when organized opposition spoke out against the timeshare tax proposal: www.co.maui.hi.us/archive.aspx?amid=&type=&adid=16838


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## jarta (Aug 20, 2013)

> What I assume is that the legal experts of the large TS groups (assume more than WKORV and WKORVN are going to take up this battle) must have considered the issues and potential outcomes and therefore it is not so black/white as to having little chance of winning, or forcing comprimise.



David,   ....   If filed to force a compromise, the suit attacking the classification system wouldn't be the first suit to be filed for that purpose.

If Maui County told the timeshare resorts it wouldn't back off an increase in the rate this time, what alternative is available except to file the suit - even given the case law on how to analyze a claim of denial of Equal Protection?

The chances of winning depend on the expert testimony that can be developed to demonstrate facts showing there is no rational purpose to support the different treatment.

The fact that the county commissioners don't like timeshares is really not all that relevant.  It's a given that they don't like timeshares.

The size of the disparity goes to confiscatory taxation of private property (sort of a destruction of value similar to a partial condemnation).  That's the Takings Clause not the Equal Protection Clause.  Maybe there will be a separate count pleaded under the Takings Clause.

I am not quite sure why you think my pointing out the legal standards (as a point of information to let all know the issues that are relevant) means that I don't think the suit should have been filed.  I think filing the suit was a good thing.  But, it will be a hard suit to win.   Salty


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## DavidnRobin (Aug 21, 2013)

Well... At least we have this thread to look back upon in a few years.  It will be interesting.
Beyond the airfare and MFs - we spend about $350 per day in HI and we are there each and every year.  I hope Mr and Mrs Maui realize this...


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## LisaRex (Aug 21, 2013)

I wonder what Starwood did to piss off Maui council?  Reading between the lines and looking at the timing of the "Timeshare Conversion" study and the decision to give timeshares their own unique classification right after WKORV was built, and as WKORV-N was being built, it appears that WKORV was the primary target.  

In addition to reclassification of timeshare, Maui also passed very restrictive "green" measures, in order (IMO) to stall or quash the development of WKORV-NN altogether.  When that didn't work, they tried to renege on their zoning approval.  I guess Maui lost that battle, because now they are trying to quash all future timeshare development.  And that measure comes conveniently AFTER Hyatt's timeshare was greenlighted.  

Another thing that puzzles me:   After the steep increase in real estate taxes, I expected an outcry from all Maui timeshare owners, especially the ones who own at modestly priced resorts who'd enjoyed relatively low MFs, on how steeply their MFs have risen.  I haven't heard a peep from them, and my guess is that Maui was very kind to them on the valuation end.  (If only I had the time and inclination, I'd do an informal Tug study on this theory....)

Anyway, the relationship must have really deteriorated to cause Starwood to file suit, because they know that further pissing off Maui will only lead to more pain on the WKORV-NN development.  Starwood will ultimately win that battle, I imagine, but politicians can certainly cause delays.  (I wouldn't be the least bit surprised if an ancient Hawaiian artifact is "discovered" on the grounds of WKORV-NN.)

So... I wonder why it is that Starwood is the target?  Did officials not schmooze the right people?  Did a Starwood official sleep with a councilman's wife?  What is it that caused the animosity here? And why can't they take it out into the parking lot and beat the crap out of each other, instead of making WKORV owners pay the price? 

I'll probably never know the back story, but it'd probably be a great read.


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## okwiater (Aug 21, 2013)

What is a timeshare anyway besides a condo project with a Homeowners association and deed that specifies 1/52 ownership? IANAL, but it seems to me that the purpose of a real estate deed is simply to convey ownership of a real estate interest between parties. I am having a hard time seeing how Maui can prove that there is any rational basis for a usurious tax rate solely on the timeshare property tax classification, separate from condos, apartments, and hotels, especially when they also charge TAT (hotel) tax on the stay!


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## PamMo (Aug 21, 2013)

Starwood isn't the sole target. Marriott, Diamond, and all the other timeshare systems and resorts have been whacked with these taxes, and have worked to get lower valuations/rates. Hyatt didn't participate in the last fight, because the feeling was their new project would have been in jeopardy. 

The last rate increase was more or less revenue neutral for WKORV/WKORVN owners. The rate increased, but our valuation decreased. Of course, we'll pay more when our valuation goes up, but the county is looking for more revenue now. The current proposal is to raise the timeshare RE tax from $15.50 to $17.50.

I certainly wouldn't paint all of the locals as anti-timeshare. It is amazing how much power a small group of very determined people can have in a community. Development is a very emotional issue in Maui. Heck, it's an emotional issue everywhere - both pro and con. All hell broke loose in my city when WalMart wanted to build a new store!


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## SueDonJ (Aug 21, 2013)

I hope it's okay with you Starwood folks that I linked this thread to one on the Marriott board?

[2012] Maui Owners FYI


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## Westin5Star (Aug 21, 2013)

While our home is being built in Roatan, we are evaluating our options with our TSs.  We love them all but we will not be using them as often as we do now.  Between II, splitting lock offs, and using SOs in lower seasons, our TSs generally net us 8-10 vacations a year.  We will probably lower that to 2-3 yearly vacations at our Starwood TSs once our Roatan house is completed.  Based on our preferences, those will be trips to WSJ (SOs), HRA, and WLR (with a week to Hawaii every 2-3 years).

So we have 4 weeks of TSs that we pay yearly for (approximately $3k for WKORV and HRA and approximately $1400 for WKV and WLR).  As much as we love our OFD at WKORV and our HRA unit, the MFs along with the ease of trading through II and with SOs make the decision very interesting.  I really do not care that much about the extra that I pay yearly for my WKORV as we love the unit (as we use our OFD every year right now).  As I mentioned though, we will likely only visit Hawaii every 2-3 years moving forward.  I am just not sure that it makes sense to pay the MFs for the WKORV unit if we only use it every few years.

I know that the MFs are made up of many different costs but the taxes are a pretty good chunk of it.  At this point, we can always just sell our WKORV and rent an OF unit every few years if we want to do so.  The taxes are not the only reason for this logic but they will play a role in our decision.


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## SMHarman (Aug 21, 2013)

Interesting

http://tugbbs.com/forums/showpost.php?p=1281238&postcount=65



Syed said:


> I attended the Maui County Council meeting held this morning in Wailuku. In attendance were Jason Gamel who is the ARDA Vice President, State Government Affairs and Ken McKelvey representing ARDA-ROC, along with a Diamond Resorts representative, the General Manager from Sands of Kahana, two representatives from Marriott Maui Ocean Club, Angela Nolan, General Manager of Westin Kaanapali Ocean Resort Villas and another Westin Kaanapali Ocean Resort Villas employee,  a lawyer representing the timeshare industry and a representative from Worldmark/Wyndham.
> 
> While the representatives from the various timeshare resorts and the timeshare attorney focused on the impact of higher taxes for timeshare owners, I addressed the Council as a Maui resident and local businessman who is involved in timeshare resales.  I voiced my concerns in regarding how higher timeshare taxes will affect the local economy, employment and other areas of tourism – restaurants, tours, car rentals, etc.  My concern is if the taxes continue to rise, there will be more foreclosures which could cause associations to lay off employees and timeshare vacationers will spend less money in the local economy.
> 
> ...


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## jarta (Aug 22, 2013)

Looks like the claim is that Maui County violated HI's Sunshine Law (Open Public Meetings Act) in adopting the property tax classification scheme.

http://www.mauinews.com/page/conten...-hit-with-new--Sunshine-Law--suit.html?nav=10

Salty


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## sjsharkie (Aug 22, 2013)

Thanks for posting this.  I don't subscribe, so I can't read the rest of the article without paying.

I did note that in the situation where the Sunshine Law was raised, the court did not invalidate the approval for the land issue in question.  It merely threw the case back down to the circuit level to award damages to the plaintiffs.

This probably supports your argument that this case might not be easy to win.  Of course, without reading the rest of the article, I don't know what else was referenced.

-ryan


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## DavidnRobin (Aug 22, 2013)

You can read it in the Maui News app - unfortunately can't copy/paste it.

{Editorial} Apparently the disdain of Timeshare owners by the Maui mayor and certain council members led them not to follow the Sunshine Act when establishing the tax rate for Timeshares.  The other example was 'water under the bridge' as the project was already done (so what can be done other than a fine or slap on wrist?).  I believe this public disdain will go against them - especially in light of the Sunshine law - our resident property tax expert (jarta) disagrees with me (as noted above)

The other part of the lawsuit is the Equal Protection that jarta referenced and claimed that due to a SCOTUS ruling on this - this would be a difficult/improbable argument to win (in my novice reading of this - I do not think it applies as it is a different circumstance - but he is the expert.  Time will tell...)

I will try and get a copy of the Maui news article and post - if someone else is a Maui News subscriber - please paste article.


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## DavidnRobin (Aug 22, 2013)

Try this...  iPhone screen snapshots.


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## sjsharkie (Aug 22, 2013)

David--

Thanks for posting this.  Good info here on the case.

-ryan


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## jarta (Aug 22, 2013)

^^^   Thanks David!

The HI Sunshine Law says the suit to void the action complained about must be filed within 90 days of the final action.

The statute also says the governmental unit must pay the attorneys fee for the plaintiffs if they win.

There is no clear statement in the Maui News article on what the plaintiffs' claimed relief would be if they are successful.

Unclear from the Maui News article whether the suit requests the county to go back to the prior timeshare level, put timeshares at the hotel level or repass the classification ordinance.  Salty


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## hypnotiq (Aug 22, 2013)

I think most of its covered in the last slide.

The article infers (I think) that they want to go back to the way it was in 2004, where it was part of the hotel tax category.

Also, they are asking for damages be determined at trial.

IANAL so I could be completely wrong though.


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## PamMo (Aug 22, 2013)

I'm unable to snip quotes from David's post, but I don't get the part about "from late 2004 until Aug. 7, _*the county was the only local government in the United States with a separate real property tax classification for timeshare properties, because the county sought to make up for losses of transient accommodations tax revenue" *_

Wait a minute...timeshare owners kept vacationing in Maui when casual tourists bailed, and we're rewarded by being forced to pay much higher RE taxes AND a nightly transient accommodations tax to stay in our own property!? This stuff drives me crazy...


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## sjsharkie (Aug 22, 2013)

Honolulu county just voted to create a separate classification of property for timeshares. No doubt next step is to create a higher rate of property tax as well. 

That is what the article is referring to. 

Ryan

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## DavidnRobin (Aug 22, 2013)

The end of the article... the main part was the WKORV/N lawsuit

My 1st Tapatalk post

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## Westin5Star (Aug 23, 2013)

DavidnRobin said:


> My 1st Tapatalk post
> 
> Sent from my iPad using Tapatalk - now Free


I just posted my first tapatalk post a few minutes ago as well. 


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## GaryDouglas (Aug 23, 2013)

*What do you think would happen if we:*
Created a website to centralize and organize Maui timeshare owners to put forth an effort to advise restaurant owners, businesses and shopping malls that as timeshare owners, we are tired of being unappreciated for all the good we do for their economy by employing staff to run our resorts and all the money we spend at their restaurants and business throughout the island. What would happen if we chose a year where all owners agreed to not spend any money outside of going to a grocery store or eating at our own resort? Do you think they would notice the difference? Here are the enterprises that we honored with our presence and expenditures this last May. Dukes, Leilani’s, Pineapple Grill, Hula Grill, Tommy Bahama’s (stores and restaurant), Hana Hotel, Longhi’s, Fleetwood’s, the Sea House Restaurant, shops at Wailer’s Village, Lahaina shops and some of these multiple times. Now, multiply that by thousands of timeshare owners. Other years we have biked down Haleakala, zip-lined, parasailed, snorkel trips, jet skis, Upcountry Winery, Mama’s Fish House, Famous Dave’s, Cool Cat Café, Roy’s, and more. But rather than choosing not to spend money there, why don’t they just do the right thing and tax us at the same rate as hotels. The County of Maui feels we are a cash cow, and since we can't vote, we have no address through government channels. The only thing left for us is the marketplace and the power of the purse.


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