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Energy surcharge

TAG

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We just got back from Kauai last night. We stayed at the Cliffs Club in Princeville for a week, then moved to the Point at Poipu for the second week. Mostly sun, some rain - all-in-all a very relaxing trip.

At the Point, the receipt included the TOT and a cost for an energy surcharge of $10/day (per unit, not by the number of people) - plus tax of 4.166% on the surcharge. The receipt for the Cliffs Club just has the TOT and the energy surcharge. Why would one facility show tax on the surcharge while the other one doesn't? Any why isn't the energy surcharge by number of people rather than by the unit? (More people = more laundry, more cooking, more hot water, etc.) I didn't even think about this until I got off the plane . . . . .
 

rickandcindy23

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Who knows why the resorts do what they do. :p

Did you have ocean views at either resort? Did you end up with a lower-level unit at Poipu Point? Were you there on exchanges for both weeks?
 

TAG

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We exchanged in to both resorts, both had ocean views. The Point was a real 2 bedroom 2 bath, the Cliffs was a 2 bath, one bedroom plus the loft unit.
 

rickandcindy23

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Wow, I am jealous. Our Poipu Point unit was a view of the hot tub from the lowest level of the building. I was not disppointed because it was our first trip ever to Kauai (2000), but now I have different expectations. :D
 

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4.166% is the the Hawaii General Excise Tax. GET differs from a sales tax in that it's a tax on the gross proceeds of a transaction. A sales tax is added to a transaction.

The actual amount of the tax is 4% and in most cases, businesses do not include the GET in the price of the goods or services and they are permitted to charge 4.166%. In that case the total amount is taxed at slightly under 4%, but the business still has to pay 4% on the amount of the total transaction including the 4.166% they added to the price. Screwey, isn't it? In virtually all cases, you are going to pay 4.166% GET on top of the price of goods or services in Hawaii.

So, in one case, the surcharge may have included the GET, and in the second case it may not have not included the GET.

I would be asking if you knew you had to pay that surcharge when you reserved or booked the accommodations? If not, they may not be able to charge you a surcharge.

-David
 
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Mimi39

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I just got an e-mail this AM notifing us that the Imperial of Waikiki has initiated a energy surcharge. Here is their explanation:



Effective January 1, 2009, the Board has elected to implement an $8.00 per day energy surcharge on all room nights booked at the Imperial Hawaii Resort including owner time shares, exchanges, add use and nightly room rentals. This is a result of the high energy costs we have incurred in 2008 through our energy supplier Hawaiian Electric Company (HECO). It's important to understand that 97% of Hawaii's energy requirement is sourced from elsewhere in the world and we are subject to the market as a consumer. HECO's cost of energy is based primarily on the price of low sulfur fuel oil used to burn in their power plants which is sourced from numerous countries delivering crude oil or refined products to the Hawaiian refineries via tankers whose transportation surcharges reached in the mid 40% range throughout this year. In addition, there is generally a two month lag from the prices seen in public postings to the time it is reflected in HECO's charges because of the inventory they carry, so they charge the cost of supply purchased sixty days prior.

As an owner I'm happy to pay this fee and appreciate the board taking action to keep solvent.
 

california-bighorn

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Mimi 39
I also got my email about the energy surcharge from the Imperial yesterday. I understand why the Imperial is imposing this and they gave one of the better explanations for imposing a surcharge. But, I couldn't help wondering if this energy surcharge will be dropped when the cost of oil is now below the cost paid 2 years ago. I think the action the board took was pro-active to head off what appeared to be potiental future problems, but the "problem" turned out to be more of a temporary spike. Maybe these types of surcharges should only apply when the cost of energy exceeds some predetermined percent increase and go away if the price drops back down like it has.
BTW, with fuel prices dropping when will the airlines drop fares and stop charging for your 1st and / or 2nd piece of baggage? :hysterical:
 

TAG

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Yes, we were aware of the energy surcharge when we booked the weeks. I have no problem paying for energy used. My confusion was in the 4.166% on top of the energy surcharge.

I do think it would be more equitable if the energy surcharge was based on occupancy rather than being based on the unit. In our case, we were two people. There were other units being occupied by 6 people. I suppose it's like the maintenance fees - some people are harder on a unit than others and it's easier to just portion the total cost out by unit.
 

Dave*H

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IMHO, energy surcharges should be included in the MF. These type of charges transfer costs to exchangers and owners who use their unit to the benefit of owners who just let their units go unused. None of my home resorts have energy surcharges even though I'm sure it costs a fair amount to heat a mountain unit in the middle of January and, unlike air conditioning, you can't just turn off the heat in the empty units or the pipes could freeze. Perhaps mountain resorts could charge an optional snowplow fee. I you want a parking space that is been plowed, you would have to pay the fee. :) Seriously, am I missing something? Is there a good reason why the fee should not be part of the MF?
 

california-bighorn

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Dave H
You're not missing anything. All the costs of running and managing a TS resort SHOULD be budgeted for in the MF's.
Another subject, but, I also don't like it when we exchange into a resort then have to pay for "extras" like using the gym, room safe, phone and other items that were already paid for by the owner's MF's.
I think it's the same principle as taxes, divided them up into pieces so the overall picture is not as easy to see and it doesn't look so bad.
I consider these extra fees the result of poor management.
 

rickandcindy23

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Yep, the room safe thing really bugs me. You have to pay to protect your valuables from getting stolen or misplaced. It seems that should be included, no matter which resort you are staying. That darned Vacation Village at Parkway charges for use of the safe. I don't remember specifically any of the others that charge, but I will always remember VV at P because we lost Disney tickets in that room somehow. :rolleyes:
 

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Is there a good reason why the fee should not be part of the MF?
The board of directors of these timeshares decided to transfer some of the energy costs to the people that actually occupy the unit rather than the owners. If an owner occupies their unit, they will pay it, and there's no difference. If an owner trades or exchanges their unit, the people occupying it will pay it.

If a unit goes empty, it won't use very much energy anyway.

I don't know if that's a "good reason" or not. That's a very subjective question, Dave. In general, I don't like energy or any other sort of surcharges. Hotels tried that a few years ago and got into trouble over it.

I think it's fair, as long as you know up front prior to requesting an exchange into that unit or renting it, that you will have that cost. If it isn't disclosed up front, then it's not fair. If it is disclosed, you can take that cost into account when you decide if you want to exchange into that unit or rent it.

-David
 
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Werner

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The definition of the "energy charge" at Poipu may have changed lately but at one time it was the charge that traders (but not owners) got hit with for using the A/C. It was an optional charge since you could elect not to use the A/C at check in. (Most units at Poipu have pretty good cross ventilation so you can do fine without it.)

Also, at Poipu the safes belong to a concessionaire and are not part of the MF structure.

I think a lot of TSs are trying to off-load services (like safes and sports or beach equipment rentals) to concessionaires and charge for in-house services that could be optional usage, like A/C.
 

TAG

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More confused

I was checking my credit card charges. I saw the charge I was expecting from the Point, plus an additional charge I was not expecting.

I called the resort. I was told that somebody thought we had stayed the whole week and that the original charge was incorrect; they processed an additional charge to make up the balance. I was told that the additional charge would be reversed.

Shortly thereafter I received a call and was told that only the TOT would be reversed since the energy surcharge and the tax were a 'weekly' charge. If the charges are weekly, why are they posted as a daily charge?

I feel I need to contact Diamond management directly. It appears they don't know what they're doing.

:confused:
 

JanB

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Here is the rest of the email:

"At the time the board set our 2008 maintenance fee budget, crude oil was trading in the $90.00 range and this is what we used in our energy cost forecast for budgeting purposes. At no time did we envision that crude oil prices would rise so dramatically, reaching $147.00 per barrel which occurred in July of this year. When you consider the cost of crude oil, transportation to Hawaii including tanker fuel surcharges and the sixty day lag it became quite obvious that our costs far exceeded our estimates. Rather than increase our 2009 maintenance fee above the 7% set this month, we have chosen to implement this nightly energy charge so that the costs will be borne by all users rather than our owners. Our figures show approximately 20% of the Imperial Hawaii Vacation Club owners come to Hawaii each year with the majority trading their weeks into other holiday destinations. Therefore, only those who visit the Imperial in 2009 will be subject to this charge. Should you choose to exchange, then the exchanger will be subject to the energy charge. Many timeshare entities have had energy surcharges in place since 2007 and while we regretfully are forced to follow suit we believe the user pay scenario should prevail rather than increase maintenance fees to cover our 2008 shortfall."

As an owner, I emailed back to the Board, 'And now that oil is trading below $60 per barrel, this charge is still necessary? I’ve too often seen that once a “fee” or “tax” is implemented due to an unusual circumstance(s), that charge NEVER goes away even though the circumstance(s) that initiated the charge is long gone!"
 

Mimi39

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I got an e-mail from Imperial of Waikiki that the board has suspended the surcharge with the option of reinstating it if oil prices go up signifigantly.

Also really good news, Carnival Corp. has dropped their fuel surcharge effective 12/17, this includes all their cruise lines such as Princess, Carnival, Seabourn, etc. This means our cruise price for next August has gone $180.00!
 
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