December 2020
Dear Fellow Virgin Grand Villas Owner:
We recently participated in two Board meetings and approved the 2021 budget. We are writing to update you on developments.
Maintenance fee increase
As you know from the budget that you received in the mail, maintenance fees are increasing by 2.6 percent in 2021. We regret that there is any increase in the midst of a pandemic and a national economic downturn, but there was no way to avoid it. The largest driver of the increase was an increase in insurance premiums, which we anticipated and wrote to you about last year. This increase alone accounts for an average charge of $62.23 per unit week (a little less for smaller units, a little more for larger ones). More than 80 percent of the $62.23, however, is attributable to the fact that until 2021, the developer was paying the insurance premiums for the common areas, including the resort landscaping, large pool, fitness center, laundry facility, energy plant, staff cafeteria, staff locker rooms, and roadways. Starting in 2021, the developer, in its continued effort to reallocate common area operating costs, will no longer pay these premiums, and they are being allocated to the four condominium associations, with Virgin Grand bearing the largest percentage (36.51%) of those costs because it has the largest number of units. The second largest driver of the increase (an average total of $54.08 per unit week) is, unlike in past years, we are no longer going to charge a $40 daily “resort fee” to renters, because while there is no litigation against the resort or the association, there is a risk that such fees could eventually be determined not to be consistent with law. We do not want to take a chance on being sued and having to pay legal fees as well as reimbursing renters. Increased benefit costs for staff members (an average total of $38.40) is the third largest driver of the maintenance fee increase.
One offset to the increase is due to the fact that our contingency fund for paying the deductible on any insurance claim is now fully funded, so we are no longer building charges for such a fund into the maintenance fee.
Maintenance fee delinquencies
The maintenance fee delinquency rate is currently 7.65%, up from 4.8% for the same period last year. This means that owners who do not pay their fees are locked out of their units and face liens and foreclosure suits, while those who do pay must experience higher maintenance fees to cover the full amount of expenses incurred by the association. Please pay your bill by its January 8 due date and do not risk being unable to enjoy the resort (or, through exchanges, the other resorts that you can use).
The good news about COVID-19
There have been no reports of anyone getting COVID-19 at the resort, and as of the Board Meeting on November 10, management reported that the COVID-19 rate on the island has been stable (even though it has been rising rapidly in the states). The resort has been taking strong measures to keep owners safe, including disinfecting the common areas three times a day, thoroughly cleaning and disinfecting rooms after every use, and encouraging social distancing. The Westin ferry has a new air filtration system that cleans the air more effectively than HEPA filtering. All resorts on St. John and St. Thomas were temporarily closed by the Governor of the Virgin Islands to new arrivals for two periods during the summer. But those closures ended, and the resort contemplates 83% occupancy in December.
Repurchase agreement
Many owners have written to us asking whether the developer would repurchase or take back their units. We ask about this at every Board meeting. The developer’s current response is that such a plan continues to be under consideration but that the idea was suspended during the pandemic and economic downturn. It remains a subject of discussion.
Annual meeting
Your association’s annual meeting and the board meeting that follows will be held on March 1 at 9:00 am. The meetings will be offered via a webcast for owners to be able to view the presentation, hear the proceedings and submit questions for the Q&A session following the annual meeting.
Larry Pelletier
larrypelletierx@gmail.com
Philip Schrag
phil.schrag@gmail.com
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but they weren’t receptive to that lol.