The budget that’s likely to be adopted (without fully funded reserves) is flattish with only a 0.3% increase, 1¢ per point.
They estimate the underlying Component Expenses, and true up the following year. That said, I’m sure they have a good feel for where they are steering the individual resort MF’s before the proposed Trust budget is released.
I would also like to know as I will be able to attend the meeting. Have only ever attended the annual meeting for MKO owners. Would think that there would be a bunch of Abound points owners at this meeting if open to owners. Is there a meeting room at Lakeshore large enough for 50 people?
It may be the last year for the waiving of reserves due to the Florida law changes. Though I understand they can still waive reserves but just not for certain structural items. The trust is confusing when it comes to waiving reserves as each resort the trust owns in Florida has the same vote. I don't really understand it all but all the Florida Marriott properties have been waiving reserves every year since their inception. I think only one year did Cypress Harbour not vote to waive reserves. None of them have yet had a special assessment. They use different ways to calculate reserve funding than state mandated requirements.
It always seemed to me that waiving reserves was kicking the can forward so that future owners would be forced to pay for today's wear and tear and depreciation. I have always voted against waiving reserves but the waiver always passes. Most people only care about this year's MFs I guess. To me, waiving is irresponsible.
There's a decent sized meeting room if you go to the second floor in the main building and walk towards where the treehouse kids club used to be. Not sure of the capacity.
But what have the consequences been of waiving? I know for some Florida condo HOAs it has been detrimental because they waived to the point where they don't have sufficient reserves to fulfill capital improvements. I don't think that is the case for our branded timeshare resorts. Compare the reserves for a resort like Canyon Villas to Grande Vista. Are they really that different? Compare them if you fully fund the Grande Vista reserves per the state requirements. Does Grande Vista really require such a high reserve amount?
I agree that MVC's waiver doesn't seem to put reserves into dire financial straits. But in the event of a big unexpected expense or several unexpected expenses occurring in quick succession, the likelihood that a special assessment would be necessary is greater if full reserves have been waived.
It's more than $50 or $100. I recall it being something like $350 vs. $1000 for reserves.
I think they have this already in the plan. This could actually be where the state mandated reserves fall short. Marriott HOAs do regular reserve studies and the new requirements around inspections has made them more aware of what is needed structurally. I don't have any issue with waiving fully funded reserves.
The difference between fully funded and not fully funded is nothing like $1000, but $350 might be accurate for some of the highest MF properties like Maui.
I am looking specifically at Florida resorts where fully funded vs. waived applies. It doesn't apply to properties outside of Florida. So using Maui as an example doesn't really apply. You are watering down the reserve difference by taking all BIs in the trust into account when it is only the Florida properties impacting fully funded reserves.
I think California lets properties basically decide for themselves what reserves are appropriate, whereas Florida, in the aftermath of collapsed buildings which were not maintained, has specific standards they have to adhere to. So I'd say Florida is extra conservative about reserves, which is a reaction to a tragedy or two. That could happen in California if a building falls down.
It is. Excel function =Roundup(0.0025,2) = .01
We did this in depth a few years back. If I remember correctly FL law requires a "full" funding based on a depreciation calculation of every building on the property. Marriott analysis looks at the cash flow required to refresh the buildings required in the plan for the next year plus a factor for unexpected repairs and inflation. No need to collect from owners' the roof bill for building 15 20 years in advance since it was just replaced last year. That is how most commercial buildings are run. The only property that I know of that has had issues was Ocean Pointe where the roof system installed failed to have the expected life. Think that has been a mess with contractor liability, insurance, etc. Not sure if there was a special assessment. My Orlando property and been maintained in top shape for 20 years and I have not seen any issues despite not fully funding since 2001.
I don’t believe this is correct. MVC looks out into the future many years. Look at the reserve detail on your annual budget.
Agreed as the owners of the Surfside condo building unfortunately found out.
No amount of Florida fully funded reserve funding would ever cover a complete destruction of a building. The intent isn't for reserves to cover a building if it collapses. It isn't necessarily even to prevent the collapse. That is what the new inspections are for. Funding is to cover capital improvements for the properties. We are also looking at an inland resort with Grande Vista. I am still scratching my head to understand why it somehow requires an additional $650 per unit week in reserve funding over a resort like Newport Coast Villas.
I would also like to know. I would also like to know the identity of the board members. Does anyone have this information?
This is our feeling as well, but our experience is that the majority of owners in all communities (timeshare and whole ownership) prefer to kick the can down the road. Accordingly, for our planning purposes, we are anticipating that the alternate budget that waives full funding at any component site that allows that will be what is passed. We aren't losing any sleep over it because we view our ownership as disposable at this point. If our resort is destroyed by some disaster, that will be that.
